Shares of S4 Capital PLC (LSE:SFOR), Sir Martin Sorrell's advertising group, plunged 22% after it sounded the earnings alarm.
It cited the tech sector's growing caution amid tough macroeconomic conditions for cuts to revenue and profit forecasts.
"S4 is making good progress on [its] AI-driven work; however, the tilt towards the tech sector, which historically was a strength has now for the near term become a weakness," said broker Peel Hunt in its analysis of the company's trading update.
Companies are trimming costs due to a combination of rising interest rates, persistent inflation, decelerated economic growth and geopolitical uncertainty.
As a result, S4, established by Sorrell following his departure from WPP, has revised its full-year like-for-like net revenue expectations. The company is now forecasting growth of 2%-4%, a significant decrease from its previous 6%-10% projection.
The shares dropped 30.4p to 107.5p in the first half hour of trading. Peel Hunt remains a bull on the stock with a price target of 250p.
It pointed out the stock is trading on a multiple of just nine times next year's earnings - and that was before Monday's slide.