WPP and IPG glum as Q1 numbers come in
Mark Read
The ad market was cast in a dismal light on both sides of the Atlantic with WPP and Interpublic Group (IPG) releasing uninspiring Q1 updates at the end of last week. UK-based holdco WPP reported like-for-like revenue less pass-through costs down 2.7%, while US headquartered IPG reported organic revenue down 3.6% (both YOY comparisons for the period).
Neither group offered “green shoots” language for the rest of the year, instead focusing on global economic uncertainty and internal initiatives to rebuild momentum.
WPP’s presentation noted that “tariff-related uncertainty amplifies an already uncertain environment” and CEO Mark Read said “While WPP is not itself directly affected by tariffs, they will impact a number of our clients as well as the broader economy. At this point we have not seen any significant change in client spending and we reiterate our full-year guidance which already reflected a challenging environment.”
Mark Read
Rather than dwell on the numbers, WPP chose to focus on its “marketing operating system” WPP Open. The platform has now rolled out to 48,000 staff within WPP agencies, up from 33,000 last quarter. The holdco claims using WPP Open increases pitch conversion rates by “around 10%”.
Both WPP and IPG had particularly challenging quarters in the Asia-Pacific, with WPP reporting -5.7% and IPG reporting -9% revenue in the region (less-pass through/organic).
For WPP – which breaks out country reporting – Australia was down 0.7% revenue while China was the globally worst market at -17.4%. WPP’s report noted Warner Bros Discovery and L’Oreal as new business wins in ANZ among global bright spots.
WPP and IPG’s numbers stand in contrast to the Q1 results from Publicis Groupe and Omnicom, which were both net positive. Omnicom, which is preparing to merge with IPG globally, reported organic growth of 3.5% and is still expecting 2.5% revenue growth in its full-year worst case.
Publicis is the class overachiever with organic growth of 4.9% and predictions the business will withstand global economic turmoil to post full year growth of 4-5%.
