WPP Cuts 7,000 Jobs and Faces Profit Struggles in the Last Year
In the last year, WPP cut around 7,000 jobs. That’s a big number for one of the world’s top advertising companies. It’s not just about layoffs; WPP is also facing lower profits and a tough business environment.
As marketing shifts online, companies like WPP must change fast. But it seems they’re struggling. Big clients are spending less. New digital players are taking the lead. And now, WPP is trying to keep up.
Let’s explore what went wrong for WPP. We’ll talk about its job cuts, weak earnings, and what it means for the whole ad industry.
WPP’s Financial Performance in the Past Year
We have seen WPP report a sharp 48% drop in operating profit in the first half of 2025. Revenues, after removing supplier costs, fell by 10% to £5 billion. That decline forced WPP to cut its interim dividend in half from 15p to 7.5p. Their annual net sales forecast now points to a 3-5% fall, compared to an earlier expected drop of just 0-2%. Margins are set to shrink by 0.5 to 1.75 percentage points, slipping from 15% in 2024.
The Layoffs: Scope and Reasoning
WPP has trimmed around 7,000 jobs and cut its headcount from 111,000 to 104,000 in June 2025. That is an impressive 3.7% reduction. These cuts are meant to save more than £150 million and are part of cost controls amid a shaky business climate.
Challenges Facing the Advertising Industry
Client budgets are tight in today’s market. Many marketers worry about the economy. So, they pause or pull spending. New business pitches have dropped significantly by about 68% in count and 37% in value, compared to last year.
At the same time, AI is changing the game. Clients can now create ads themselves. This undercuts traditional agencies. WPP is not alone; others in the industry are wrestling with these same shifts.
WPP’s Strategic Response
We see WPP doubling down on technology to fight back. The company now invests over £300 million a year in AI. This fund supports tools like the WPP Open platform and a partnership with Stability AI. They’ve also relaunched GroupM as WPP Media, aiming for faster, smarter service.
But the changes have yet to show real results. Incoming CEO Cindy Rose, formerly with Microsoft, will lead a full strategic review when she starts in September 2025.
Investor and Market Reaction
WPP’s share price has fallen around 40% over the last year, hitting a 16-year low. The stock dropped another 15-18% after WPP issued its updated profit warning. Analysts noted that the tough macroeconomic environment, AI threats, and client losses are weighing on confidence.
Implications for the Broader Industry
WPP’s struggles are a warning for all agencies. Others like Publicis, Omnicom, and IPG face similar threats. Publicis has taken the lead in new business wins. Agencies must adapt or shrink. AI is forcing a rethink of who does creative work and how it’s done. We may see more industry consolidation and leaner models. Creative roles may shift toward tech skills, remote work, and project-based work.
Wrap Up
WPP is under real pressure. Profits are sliding, and jobs are being cut. We see that technology and AI are not waiting. WPP is trying to respond through restructuring, cost cuts, and AI investments. But the road ahead is tough. The firm’s fate will depend on whether its new plan and new CEO can help it adapt fast enough in a changing world.
Frequently Asked Questions (FAQs)
WPP is struggling because many big clients are spending less on ads. Also, competition from AI tools and digital platforms is hurting its traditional business model.
In early 2025, WPP’s profit dropped by nearly 48%. It made about £204 million, down from £393 million in the same period last year.
Disclaimer:
This is for information only, not financial advice. Always do your research.