A cynical anecdote is circulating in the marketing sector that a UK-based manufacturer acquired four decades ago as a foundation to build a global advertising giant might survive longer than the empire it spawned.
For a long time, the market leadership of WPP – with its 100,000 employees catering to international brands from automotive giants to Coca-Cola – stood as the corporate embodiment of Britain's stellar reputation for creative advertising.
WPP has hosted some of the most prestigious agency networks, producing world-famous campaigns such as Dove's Real Beauty, which disrupted conventional depictions of women.
Among WPP's iconic campaigns are the surprising combination of a music legend with a dairy brand, and years of campaigns for Coca-Cola, including the innovative idea to replace its logo on bottles with individual first names – a worldwide success still on shelves twelve years later.
But now, as WPP struggles to stem a growing exodus of clients worth billions of pounds and deal with an existential race to keep pace with the AI and data capabilities of rivals, there is previously unimaginable talk of a split.
"WPP ruled the world at one point, it was like the British empire," noted one marketing leader. "It was representative of UK success and the country's status as the world center for advertising."
Chapter Closes on Leadership Tenure
In August, a earnings alert 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 conclusion of a challenging 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 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 highly exposed, 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 stepped down that Monday morning.
Strategic Shifts and Brand Consolidation
The former leader's strategy was to simplify a complex organization to create – or give the impression 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 'traditional' advertising, it was a chaos," 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 argue that the departed leader has set the foundation for a turnaround and that WPP's fall was already apparent under the founder. Its market value fell significantly 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 more quickly and has 70,000 employees using its technology system.
However, concerns are increasing among the general staff over job cuts with AI poised to take over large portions of the company's creative, media and data processes.
"The place where the fear is most pronounced is at junior levels, 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 a fortnight's labor for several graduate-level people."
Tough Competition
In the ad market, WPP is being significantly outperformed – principally by France's competitor, which took its crown as the biggest ad group in the world by revenue last year.
The competitor 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 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 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 mandate her to break WPP up."
Market Sentiment and Future Prospects
Despite the immense pressure 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 primary earnings source 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 increased their position 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 domino effect 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 count WPP out."
