Released: February 27, 2025
10:10 AM Eastern Time
Essential Highlights
- WPP’s revenue in North America and China has decreased, resulting in a reduction in fourth-quarter earnings.
- CEO Mark Read mentioned that diminished discretionary expenditure by clients has affected sales.
- The London-headquartered advertising company also provided annual guidance that did not meet market forecasts.
On Thursday, WPP Plc (WPP) witnessed its stock drop by 15% in the U.S. market due to falling revenues and a bleak outlook arising from sales declines in North America and China.
The firm, which encompasses agencies such as GroupM and VML, reported a 2.3% year-over-year decrease in fourth-quarter like-for-like revenue (excluding pass-through expenses). North America experienced a 1.4% decline, while the UK saw a 5.1% drop. Revenue from other international regions (excluding pass-through expenses) fell by 4.8%, with China down by 21.2%. Conversely, Western Europe recorded a growth of 1.4%.
CEO Mark Read indicated that sales were influenced by reduced discretionary spending from clients. He further noted that while we remain wary of the overall macroeconomic landscape, we are optimistic about our mid-term objectives and believe that concentrating on innovation, enhancing client services, and achieving operational excellence will propel our growth and generate more value for shareholders.
WPP expects that full-year like-for-like revenue (excluding pass-through expenses) will remain flat or decrease by 2%, falling short of Visible Alpha’s prediction of a 0.35% rise.
This development has pushed WPP’s U.S.-listed stock into negative territory over the last year.
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