A wry anecdote is circulating in the marketing sector that a Kent-based basketmaker acquired four decades ago as a vehicle to build a global advertising giant might survive longer than the empire it created.
For decades, the economic dominance of WPP – with its one hundred thousand employees catering to international brands from Ford to beverage leaders – stood as the business manifestation of Britain's renowned reputation for innovative marketing.
WPP has hosted some of the most esteemed agency networks, producing globally resonant campaigns such as Dove's Real Beauty, which challenged stereotypical portrayals of women.
Among WPP's iconic campaigns 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 struggles to stop a increasing departure of clients worth billions of pounds and address an existential race to keep pace with the artificial intelligence and analytics power of rivals, there is hitherto unthinkable talk of a split.
"WPP ruled the world at one point, it was like the British empire," said 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 dire forecast 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 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.
"One more earnings alert could push it out and WPP is up against it," said one media analyst. "The situation WPP finds itself in now is hard to imagine. WPP is extremely vulnerable, it is possibly facing a takeover or breakup."
For WPP's board, the last trigger came when a significant customer informed the company that it was parting with 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 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 chaos," said a former senior from a WPP agency. "He killed off 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 fall was already evident under the founder. 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 more quickly and has 70,000 employees using its technology system.
However, concerns are increasing among the rank and file 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. "Grunt work, 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 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 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 "previous leadership in his prime."
US-based rivals have each seen their shares appreciate just more than 50% over the same period, with substantial market capitalisations.
Fresh Management and Turnaround Efforts
WPP has asked a ex-Silicon Valley leader to lead a recovery.
Earlier this month, she unveiled a five-year $400 million partnership with a tech giant 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 sugarcoat the situation," 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 determined 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 mandate her to break WPP up."
Investment Interest and Future Prospects
Despite the significant challenges on WPP, there are signs that investors believe the business may have hit its nadir and be set to recover.
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 increased their position 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 contagion 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 count WPP out."
