WPP, sharing its first trading update since unveiling a wide-ranging strategic overhaul in February, underscored why a turnaround is so critical while emphasizing that the process will take time.
Like-for-like revenue less pass-through costs, an important measure of agency health, declined 6.7% to 2.3 billion pounds in Q1. Organic revenue, a metric that is closely watched at rivals, was down about 4% for the period, executives said on a call discussing the results. LFL declines in the mid- to high single digits are on deck for the first half of 2026, with performance improvements expected later in the year.
WPP Media had another bruising quarter, recording LFL declines of 8.5% due a prolonged drag from prior account losses and the slower ramp up of realizing revenue from new business wins. The media-investment arm last year was rocked by a string of client departures, including Mars’ global media business and Coca-Cola’s media and data business in North America, both of which moved to Publicis.
The Iran war also affected WPP’s Middle East segment in Q1, which represents under 2% of total net sales. Broader uncertainty stoked by the conflict could have ripple effects, and industry forecasts have warned of a serious dent to overall ad spending this year if the war is not resolved quickly.
Among WPP’s 25 largest clients, Q1 LFL revenue was down 9.4%, a slide attributed to account losses and what executives described as greater polarization in ad spending.
“As I look at spend within our sectors, that polarization remains, with some clients investing with us and increasing their spend and others being a little bit more cautious,” said WPP CFO Joanne Wilson during a Q&A with analysts. “And that trend is continuing, particularly in the tech sector and in healthcare.”
Not present on the earnings call was WPP CEO Cindy Rose, who is spearheading the Elevate28 turnaround plan. The multiyear initiative, which aims to shift WPP from a holding company to a “single company” model, realigns the Ogilvy and VML owner around four core service areas — creative, production, media and enterprise solutions — and four global regions, all anchored around the WPP Open operating system.
In addition, WPP is exploring shedding aspects of its portfolio, a process that Wilson said is advancing as planned, without sharing further details. Elevate28 looks to deliver about 500 million pounds in annual cost-savings for the group.
“While it is still early days, we are very much on track against our strategic plan and encouraged by the client and employee response to the actions we are taking and the changes we are making,” Wilson said of Elevate28’s early progress.
Beyond structural adjustments, Elevate28 has led to leadership changes, including WPP hiring former Estée Lauder executive Anne-Isabelle Choueiri as its first chief transformation officer earlier this month. Recent wins for WPP include business for Estée Lauder, SC Johnson, Jaguar Land Rover, Norwegian Cruise Lines and Wendy’s U.S. media. WPP ranked No.1 regarding net-new business wins in Q1, according to JPMorgan analysis, the second consecutive quarter it has done so.
