A wry anecdote is making the rounds in the advertising world that a Kent-based manufacturer acquired four decades ago as a foundation to construct a global advertising giant might outlast the conglomerate it created.
For decades, the economic dominance of WPP – with its 100,000 employees servicing global clients from automotive giants to Coca-Cola – stood as the corporate embodiment of Britain's shining reputation for innovative marketing.
WPP has housed some of the most prestigious agency networks, producing internationally recognized campaigns such as Dove's Real Beauty, which disrupted stereotypical portrayals of women.
Among WPP's most celebrated works are the surprising combination of a punk rock icon with a butter product, and years of campaigns for Coca-Cola, including the brilliant idea to swap its logo on bottles with personal names – a worldwide success still on shelves twelve years later.
But now, as WPP battles to stop a increasing departure of clients worth billions of pounds and deal with an existential race to keep pace with the artificial intelligence and analytics power of rivals, there is previously unimaginable talk of a split.
"WPP dominated the world at one point, it was like the British empire," noted one industry executive. "It was symbolic of UK success and the country's status as the world center for advertising."
Chapter Closes on Leadership Tenure
In August, a profit warning and bleak prediction of revenue decline for this year sent WPP's shares plummeting to their lowest level since the 2008 financial crisis, marking the conclusion of a brutal seven-year tenure as chief executive.
A market capitalisation 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 being removed from the FTSE 100 index it joined almost three decades ago.
"Another profit warning could force its exit and WPP is up against it," said one media analyst. "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 significant customer informed the company that it was losing its $1.7 billion global business. The chief executive resigned that Monday morning.
Strategic Shifts and Agency Restructuring
The former leader's strategy was to simplify a sprawling operation to create – or give the appearance of creating – a group fit for an AI future. The move saw the disappearance 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 former senior from a WPP agency. "He eliminated the brands. Clients certainly didn't understand why treasured trophies had to go."
Others contend that the former CEO has laid the groundwork for a turnaround and that WPP's decline 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 cheaper and faster and has 70,000 employees using its technology system.
However, concerns are growing among the general staff over job cuts with AI positioned to take over large portions of the company's creative, media and data processes.
"The place where the anxiety is most pronounced is lower down, in starting roles where you come in and learn the business," said one staffer. "Routine tasks, data, consumer insight: AI can write you a competitive review with creative embedded in it and market segmentation in 2.5 minutes. That would have been two weeks work for two or three graduate-level people."
Tough Competition
In the ad market, WPP is being heavily outgunned – principally by a French 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 apparently tireless leader who is described by more than one industry executive as reminding them of "previous leadership in his prime."
US-based rivals have each seen their shares appreciate just more than 50% over the same period, with significant market capitalisations.
Fresh Management and Turnaround Efforts
WPP has asked a former tech executive to engineer a turnaround.
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 leading telecommunications firms, is said by insiders to have been "customer-focused" in constant meetings in New York and London.
"She is not here to sugarcoat the situation," said a source who has spent time with the new CEO since she took over. "She is very realistic about the challenges and is determined to move fast to turn it around."
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 technology recovery narrative here, if not the board will instruct her to break WPP up."
Investment Interest 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 bargain 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 contagion to winning and losing. The worry is that the decline is inevitable. But change comes when you are on the precipice of disaster. I would never write WPP off."
