A dark quip is making the rounds in the advertising world that a UK-based basketmaker acquired four decades ago as a foundation to build a global advertising giant might survive longer than the empire it produced.
For many years, the financial success of WPP – with its one hundred thousand employees servicing international brands from automotive giants to Coca-Cola – stood as the corporate embodiment of Britain's shining reputation for creative advertising.
WPP has housed some of the most prestigious agency networks, producing globally resonant campaigns such as Dove's Real Beauty, which disrupted stereotypical portrayals of women.
Among WPP's most celebrated works are the unlikely pairing of a music legend with a butter product, and years of campaigns for Coca-Cola, including the innovative idea to swap its logo on bottles with individual first names – a global phenomenon still on shelves twelve years later.
But now, as WPP fights to stop a growing exodus of clients worth massive sums and confront an existential race to match the AI and data capabilities of rivals, there is hitherto unthinkable talk of a split.
"WPP dominated the world at one point, it was like the global powerhouse," commented one industry executive. "It was representative of UK success and the country's status as the global home for advertising."
Era Ends on CEO Tenure
In August, a profit warning and bleak prediction of revenue decline for this year sent WPP's shares crashing to their lowest level since the 2008 financial crisis, marking the end of a difficult seven-year period as chief executive.
A stock market value of just £4 billion – compared with its £25 billion valuation eight years ago, when WPP was the world's largest marketing services company – has left the business at risk of falling out from the FTSE 100 index it joined almost three decades ago.
"Another profit warning could push it out and WPP is up against it," said one industry expert. "The situation WPP finds itself in now is almost unthinkable. WPP is extremely vulnerable, it is possibly facing a acquisition or breakup."
For WPP's board, the last trigger came when a major client informed the company that it was losing its $1.7 billion global business. The chief executive resigned that Monday morning.
Strategic Shifts and Brand Consolidation
The departed CEO's strategy was to streamline a sprawling operation to create – or give the impression of creating – a group suited for an AI future. The move saw the elimination of some of the most famous brands in advertising.
"It was a bashing and crashing of names that were linked to 'old' advertising, it was a mess," said a ex-executive from a WPP agency. "He killed off the brands. Clients certainly didn't understand why prestigious names had to go."
Others maintain that the departed leader has laid the groundwork for a turnaround and that WPP's fall was already evident under previous leadership. Its market value fell substantially over the founder's last year in charge.
WPP has been investing £300 million annually in AI tools to enable it to make ads more cost-effective and faster and has 70,000 employees using its technology system.
However, concerns are mounting among the general staff over job cuts with AI positioned to take over swathes of the company's creative, media and data processes.
"The place where the fear is most present is lower down, in starting roles where you come in and learn the business," said one staffer. "Grunt work, data, consumer insight: AI can generate you a market analysis with creative embedded in it and market segmentation in 2.5 minutes. That would have been two weeks work for several graduate-level people."
Intense Rivalry
In the ad market, WPP is being heavily outgunned – principally by France's competitor, which took its crown as the biggest ad group in the world by revenue last year.
The French rival has seen its share price increase almost 200% in five years, giving a market value of €21 billion. It is led by a seemingly indefatigable leader who is described by more than one industry executive as reminding them of "the founder in his prime."
US-based rivals have each seen their shares appreciate just more than 50% over the same period, with significant market capitalisations.
New Leadership and Turnaround Efforts
WPP has asked a former tech executive to lead a recovery.
Earlier this month, she unveiled a five-year $400 million partnership with a major technology company to embed AI products into WPP's technology platform.
The new CEO, who has also worked at major media companies, is said by insiders to have been "client-obsessive" in constant meetings in New York and London.
"She is not here to glaze anything," said a source who has spent time with the new CEO since she took over. "She is very clear-eyed about the challenges and is committed to move fast to reverse the decline."
Given the state of WPP's business, analysts believe she may have only a year to save it. The previous CEO sold off assets including a market research group and used the proceeds to help pay down debt.
However, lower operating profits – down 35% year-on-year in the first half of 2025 – raise doubts about WPP's "interest cover" – a measure of a company's ability to pay down debt. Of more fundamental concern is an operating margin that fell from 11.5% in the first half of last year to 8.2% in the first six months of 2025. By comparison, the figure for its main competitor is just more than 18%.
"I cannot ever remember margins being anywhere near as low as that," said one analyst. "It is shocking really. With the new CEO they have gone for the Silicon Valley touch. She will be given a year to work out whether there is a tech turnaround story here, if not the board will instruct her to break WPP up."
Market Sentiment and Outlook
Despite the significant challenges on WPP, there are signs that investors believe the business may have hit its nadir and be set to bounce back.
WPP Media, which manages more than $60 billion in global media investment in campaigns for clients, has always been the revenue and profit driver for the company. WPP Media on its own is worth more than the approximate £7.5 billion enterprise value of WPP, which includes its debt.
A number of investment funds have boosted their stake in WPP, sensing a opportunity as change looms under new leadership, but the question is whether the ad giant can convince clients and investors quickly enough.
"Investors are scared of being on the wrong side of AI," said one financial source. "It is the biggest theme in markets globally. It feels as though WPP is on the wrong side of that trade at the moment.
"Advertising clients are unpredictable, there is a domino effect to winning and losing. The worry is that the decline is baked in. But change comes when you are on the brink of disaster. I would never write WPP off."
