The beleaguered advertising group WPP has announced a radical restructure to counter the threat posed by the AI revolution, including merging its ad agencies and cutting jobs.
Aiming to be “a simpler, lower-cost, AI-enabled business”, the London-based company laid out plans to achieve £500m of annual savings by 2028, at a cost of £400m over two years.
A significant proportion of the cost cuts are expected to come through cutting jobs. The company did not specify how many roles would be cut.
Since its inception in the mid-1980s, the steepest cuts WPP has made were 7,200 jobs as a result of the global advertising recession in 2009, and 7,000 in 2020 because of the impact of the Covid pandemic.
A large chunk of the savings will be reinvested into “high-growth” areas, it said on Thursday.
The troubled company will set up a stand-alone division to partner with clients on AI transformation, as it reorganises the group into four regional businesses: North America; Latin America; Europe, the Middle East and Africa; and Asia Pacific.
Its ad agencies – Ogilvy, VML and AKQA – will be merged under the WPP Creative umbrella as part of the plan.
Cindy Rose, the chief executive, said the company was “unveiling a bold plan for a simpler, more integrated WPP that’s fit for the future”.
London-listed WPP, which has struggled to stem a growing exodus of clients and is racing to match the AI and data capabilities of rivals, employs about 100,000 staff globally.
Rose, who signalled job cuts on arriving last year, added: “Our recent underperformance has been driven by excessive organisational complexity, a lack of an integrated operating model and inconsistent strategic execution. While disappointing, I see huge potential as these issues are all within our power to fix and we’re already making great progress.”
Her comments came as WPP reported a 3.6% drop in comparable revenue to £13.6bn for 2025, and a 26% fall in profit before tax to £1.1bn.
Last week the US rival Omnicom, which completed a $13bn (£9.6bn) takeover of the rival Interpublic in November, doubled its target for annual cost savings to $1.5bn. The announcement, which included savings of $1bn by reducing “labour costs” by 2028, cheered investors, which sent its share price soaring 15%.
WPP, which spends almost £8bn annually on staff costs, is fighting for survival with a market value languishing at £3bn.
The company was valued at £25bn only nine years ago but its share price has slumped almost two-thirds over the past year.
After a series of profit warnings the company fell out of the FTSE 100 after nearly 30 years at the end of last year, having lost its crown as the world’s biggest advertising group by revenue to the French rival Publicis Groupe in 2024.
Earlier this month, new data showed UK advertising agencies had their biggest annual exodus of staff last year, led by younger workers, as artificial intelligence tools threaten to replace workers and force the industry to cut jobs and costs.
