WPP’s Mark Read expects tough second half after “Worse than expected” June

New Delhi: WPP has downgraded its full-year 2025 outlook, citing a deteriorating macroeconomic environment and underwhelming net new business performance. 

In its latest trading update released Tuesday, the advertising holding company revealed that Q2 performance weakened further, pushing H1 revenue less pass-through costs down by an estimated 4.2% to 4.5%, with a sharper Q2 decline of 5.5% to 6.0%.

The company also flagged a steep drop in headline operating profit for H1, expected in the range of £400 million to £425 million, translating to a margin decline of 280 to 330 basis points year-on-year, excluding forex impact.

As market conditions remain uncertain and client spending continues to be under pressure, WPP has revised its like-for-like revenue growth guidance for FY2025 to a decline of 3% to 5%, down from its earlier forecast of flat to -2%. It also expects a year-on-year fall in headline operating profit margin by 50 to 175 basis points, despite ongoing cost-saving measures.

“Since the start of the year, we have faced a challenging trading environment with macro pressures intensifying and lower net new business. While we expected the second quarter to be similar to the first quarter, performance in June was worse than anticipated, and we expect this pattern of trading in the first half to continue into the second half,” said Mark Read, CEO of WPP. 

Read acknowledged the drag from both macro pressures and disappointing new business wins, adding that WPP’s near-term focus will be on balancing long-term investments with further structural cost reduction.

He said, “Our focus remains on ensuring the right balance between investing in the business for the long-term and continuing to reduce structural costs, while taking appropriate actions to respond to the current trading environment.”

The profit warning follows the recent announcement of Mark Read’s departure, ending his seven-year tenure as CEO and a 30-year journey with WPP.

The update highlights the growing pressure on global agency networks as economic uncertainty, reduced client outlays, and rising competition from digital platforms and AI-powered models challenge traditional business strategies.

With a reshuffle in leadership expected soon, all eyes are now on how WPP will stabilise operations and restore growth momentum in the second half of the year.