WPP has announced that Cindy Rose OBE has been appointed as CEO. Rose will take over the reins on 1 September 2025, with current CEO Mark Read stepping down on the same date. The two are working together in the meantime to ensure a smooth transition.
Rose has been on WPP’s board since 2019 and has previous CEO experience at Microsoft UK. In her previous roles, she also worked for Vodafone, Virgin Media, and The Walt Disney Company.
The shares rose 3.5% in early trading.
Our view
Hot on the heels of a profit warning, WPP has selected Cindy Rose OBE as its new CEO. While Rose lacks equity market-facing leadership experience, as an existing board member, she's already very familiar with the business.
Back to business, and WPP’s first-half numbers were a painful read as clients pulled back on advertising spending. With that trend expected to continue into the second half, full-year guidance has been downgraded.
At its core, WPP’s media agencies deliver products and services spanning the advertising and communication spectrum. It boasts some of the world’s largest companies as its customers, and provides them with analytics, paid advertising campaigns and PR.
In a bid to improve performance, WPP plans to focus on faster-growing end markets (like how to help clients succeed online) and technology. Hundreds of millions will be spent over the next few years, most of which will go on new staff, technology, including AI, and incentives.
But keep in mind that WPP's agency business is being nibbled away at. The group's doing what it can to combat these challenges, including consolidating and streamlining its offering.
These ongoing restructuring and severance actions at WPP Media are set to bring long-term annual cost savings of over £150 million. But in the short term, the restructuring is proving a distraction for management and weighing on profitability.
The balance sheet was in decent shape the last time we heard. However, weak performance of late has put pressure on the valuation, pushing the dividend yield well above the long-run average. These payments are well covered by cash flows for now, but we can’t rule out dividends being wound back if performance doesn’t pick up in the near to medium term.
Tariffs aren’t likely to have a direct impact on WPP. But if they lead to an economic slowdown and WPP’s customers need to rein in costs, advertising budgets will likely be one of the first things on the chopping block. There hasn’t been much change in client behaviours yet, but the picture can change quickly.
We’re also mindful of AI. This offers enormous opportunity for WPP, but also risk. There’s a chance the advertising and analytics landscape changes so fast that WPP is left behind if it doesn’t peddle fast enough.
WPP’s performance hasn’t been as good as some other names in the advertising world, which has seen the valuation fall well below the long-run average. The new CEO will need to hit the ground running if she’s to stem client losses and turn the group’s fortunes around. But it’s a tough job, and there are no guarantees.
Environmental, social and governance (ESG) risk
The media industry’s ESG risk is relatively low. Product governance is the key risk driver, alongside business ethics, labour relations and data privacy & security.
According to Sustainalytics, WPP’s management of ESG risk is strong.
The group has a board-level sustainability committee assisting in its oversight of corporate responsibility and sustainability matters. Advertising companies collect, analyse and process large volumes of sensitive client data, and there are often large fines in place for failing to comply with privacy or security regulations. WPP’s due diligence process includes a review of ethical risks, such as bribery, corruption, and human rights issues.
WPP key facts
All ratios are sourced from LSEG Datastream, based on previous day’s closing values. Please remember yields are variable and not a reliable indicator of future income. Keep in mind key figures shouldn’t be looked at on their own – it’s important to understand the big picture.
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