WPP’s share price fell again today, shedding a further 3% as markets reacted to the group’s halved dividend, falling profits and a strategic review announced under incoming CEO Cindy Rose.
Shares in the advertising giant, which has a major Northern hub at the former Granada Studios site in Manchester, dropped as much as 4.7% in early trading, before settling around 3% lower. The stock is now down 53% since the start of the year, and more than 67% below its post-pandemic peak.
The fresh fall follows today’s half-year results, which revealed a 5.8% drop in Q2 revenues and a 48% plunge in headline operating profit to $552m (£412m). WPP confirmed it would slash staff bonuses by 60%, cut headcount by 4,000 and reduce freelance usage by 14% year-on-year.
The FTSE 100 group also halved its interim dividend to 7.5p per share, which it said would give Rose – a former Microsoft executive and WPP non-executive director – “room to review the group’s strategy and capital allocation policy while maintaining financial flexibility.”
But the move did little to soothe investor concerns, with analysts warning that WPP faces “huge structural storms in the ad industry”, according to Saxo Markets’ Neil Wilson.
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The group’s underperformance has been exacerbated by the loss of major global accounts to French rival Publicis, including Coca-Cola’s North America media business and Mars’ $1.7bn (£1.3bn) integrated marketing work.
WPP’s flagship creative division, which includes agencies such as Ogilvy and VML, was down 7.2% overall – although UK performance at Ogilvy bucked the trend.
The firm has also been hit by a broader slowdown in client spending and a sluggish new business pipeline. Mark Read, who will step down as CEO on September 1, said the first half had been “challenging”, but pointed to continued investment in AI and technology as cause for long-term optimism.
WPP’s share price now sits at its lowest level since the global financial crisis, nearly 80% below its 2017 all-time high of 1,900p.
