WPP PLC (LSE:WPP) shares dropped 14% in early trading following an updated outlook that lowered revenue and profit expectations for 2025.
The advertising and marketing giant sounded the alarm as it pointed to a tougher economic environment and weaker new business as reasons for the revision.
The company now expects first-half like-for-like revenue to fall between 4.2% and 4.5%, with the second quarter’s decline steepening to 5.5% to 6.0%.
This compares unfavourably with earlier forecasts and reflects one-off impacts alongside broader macroeconomic challenges.
Headline operating profit for the first half is projected between £400 million and £425 million, implying a margin contraction of 280 to 330 basis points year on year, excluding currency effects, investors were told.
For the full year, WPP has downgraded its revenue guidance to a decline of 3% to 5%, from a previous forecast of flat to a 2% fall.
The group now anticipates headline operating profit margins to decrease by 50 to 175 basis points, compared with an earlier expectation of stable margins.
Chief Executive Mark Read said the company is balancing investment in long-term growth with cost reductions to manage the more difficult trading conditions and softer client demand.
The stock dropped 75.6p to 452p.