WPP cut its outlook for the second time in as many quarters as tech clients continued to cut back on marketing spend.
The firm, whose agencies include Ogilvy, said it now expects like-for-like growth for 2023 of just 0.5 to 1 per cent for the year after revenues less pass-through costs fell 0.6 per cent in the last quarter.
The market had expected WPP to post 1 per cent growth over 2023.
WPP’s like-for-like revenue less pass-through costs fell 0.6 per cent in the quarter while the market had expected 1.0 per cent growth
Mark Read, chief executive officer of WPP, said: ‘Our top-line performance in Q3 was below our expectations and continued to be impacted by the cautious spending trends we saw in Q2, particularly across technology clients with more impact from this felt in GroupM over the summer than the first half.’
Read noted that Meta, which published its results this week, had reduced marketing spend by 24 per cent.
He told the Reuters news agency: ‘Technology companies… are looking very carefully at their marketing expenses.
‘But I do think in the long run that will correct itself.’
Previously, the firm lowered its revenue guidance after US tech clients cut spending on advertising and growth in China was slower than expected.
In an August trading update, the group told shareholders it expected like-for-like revenue of 1.5 to 3 per cent in 2023, down from previous guidance of 3 to 5 per cent growth.
It also reported that comparable revenues rose by 3.5 per cent to £7.2billion in its first half, but second quarter growth slowed to 2.3 per cent.
WPP shares were down 3.24 per cent to 668.60p in morning trading on Thursday.
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