The gloomier outlook from WPP echoes that of rival agencies in recent weeks as companies prune their marketing budgets because of economic uncertainty. Last month, US-based Interpublic halved its growth forecast, Omnicom fell short of second-quarter analyst expectations and S4 Capital, owned by former WPP executive Martin Sorrell, issued a profit warning as clients tightened marketing budgets.
WPP posted revenues of £7.2 billion for the six months to the end of June, up 3.5 per cent on a like-for-like basis compared with the same period a year earlier. Pretax profits for the first six months of the year fell to £204 million from £419 million in the same period in 2022. Conor O’Shea, analyst at Kepler Cheuvreux, said any agency with “high exposure” to the tech sector was “vulnerable”. “Big and small tech have been huge advertising clients in recent years but the end of the free money era means a big reset of marketing spend,” said O’Shea.