WPP now expects revenues to decline in 2024 after cutting forecast and 3,000 roles

WPP has cut its 2024 growth forecast as it reported a drop in like-for-like revenue less pass-through costs in Q2 of 0.5%.

In results for H1, WPP said it expected growth of between -1% to 0% for 2024, down on previous guidance of 0% to 1%.

In Q2, revenue less pass-through costs declined by 0.5% to $3.6 billion (£2.9 billion), which was described as a “sequential improvement” on Q1, which saw a 1.6% decline in revenue.

Revenues at global integrated agencies fell 0.6% in Q2, while Group M grew by 1.4% and creative agencies declined by 2.4%.

By region, China saw the most dramatic Q2 decline, down 24.2%, followed by the UK (down 5.3%), while North America grew 2%, western continental Europe grew 0.3% and rest of world fell 2.2%.

In the Asia-Pacific region, WPP's performance was mixed. India emerged as a standout market, with revenue growing by 9.1% in Q2. However, the decline in China overshadowed the positive performance in India. The drop was attributed to significant client assignment losses including Yum! Brands, Dyson and Swatch and ongoing macroeconomic pressures, which continue to pose challenges to WPP's operations in the market.

Mark Read, chief executive at WPP, said the “second quarter performance delivered sequential improvement” in revenue less pass-through costs. He added that GroupM, Ogilvy, and Hogarth continued to grow, and that there was “sequential improvement” at Burson, VML, and the network’s specialist agencies.

WPP disclosed headcount has dropped by more than 3,000 to about 111,000 at the end of H1 2024 from 114,173 at the end of December, following a series of internal restructures including the VML and Burson mergers and simplification at GroupM.

Read told Campaign that WPP had tried to minimise job cuts through “attrition” by not filling some vacancies when people departed, although agency mergers had led to some role reductions, notably at a senior level.

On the reduced forecast, Read said, “Importantly, we also saw North America return to growth in the second quarter. That said, we have seen pressure in China and in our project-related businesses which, together with an uncertain macro environment, has led us to moderate our expectations for the full year.”

WPP also announced an agreement on the sale of its majority stake in communications consultancy FGS Global to KKR, which would generate proceeds of around £604 million after tax.

X and Elon Musk

Read declined to give any comment when Campaign asked him a series of questions about Elon Musk, the owner of X, who has clashed with the UK government and global advertisers this week.

Musk claimed on Monday that "civil war is inevitable" in the UK because of recent social unrest and, in an unrelated move, announced on Tuesday he was declaring "war" on some advertisers and suing the Global Alliance for Responsible Media and brands, including Unilever and Mars, over claims they have boycotted X.

WPP previously faced some criticism when Read interviewed Musk on stage at Cannes Lions in June. Read insisted to Campaign at the time that "I think we should be able to hear from him directly", but "not to endorse every view he has on every topic, some of which I disagree with.”

*This article has been updated by the Campaign Asia-Pacific team to reflect the region's earnings data. It was originally published on Campaign UK.