WPP Unveils Radical Restructure to Counter AI Threat, Plans £500M in Savings

When Cindy Rose took the helm at WPP last summer, she inherited an advertising empire at a crossroads. The world’s former largest advertising group had just been dethroned by French rival Publicis, fallen out of the FTSE 100 after nearly three decades, and watched its market value plummet by more than two-thirds. Today, Rose unveiled her answer: a sweeping restructure that puts artificial intelligence at the center of the company’s survival strategy.

“We are unveiling a bold plan for a simpler, more integrated WPP that’s fit for the future and built to win.” — Cindy Rose, WPP CEO

The Scale of the Overhaul

The London-based advertising giant announced plans to become “a simpler, lower-cost, AI-enabled business” with £500 million in annual savings targeted by 2028. The restructuring will cost £400 million over two years and involves significant job cuts across WPP’s 100,000-strong workforce, though the company did not specify exact numbers.

The reorganization consolidates WPP’s sprawling empire—hundreds of units accumulated over decades—into four main divisions: media, creative, production, and a new enterprise solutions unit. The latter, already employing over 1,000 people, will focus specifically on partnering with clients through AI transformation.

Agency consolidation represents a major pillar of the strategy. Ogilvy, VML, and AKQA will be brought together under the WPP Creative umbrella while maintaining separate brand identities. The move aims to eliminate duplication in finance and support functions while stripping out organizational layers.

“Our recent underperformance has been driven by excessive organisational complexity, a lack of an integrated operating model and inconsistent strategic execution.” — Cindy Rose

The AI Imperative

The restructuring comes as AI threatens to fundamentally reshape the advertising industry. Recent data showed UK advertising agencies experienced their biggest annual exodus of staff last year, led by younger workers, as AI tools increasingly threaten to replace traditional roles and force cost reductions across the sector.

Client behavior is shifting rapidly. WPP has struggled with a growing exodus of clients who fear AI will allow them to bring more marketing functions in-house. The company is racing to match the AI and data capabilities of rivals—particularly Publicis, which overtook WPP as the world’s largest advertising group by revenue in 2024.

Competitive pressure intensified last week when US rival Omnicom—fresh from completing its $13 billion takeover of Interpublic—doubled its cost savings target to $1.5 billion annually. That announcement, which included $1 billion in “labour cost” reductions by 2028, sent Omnicom’s shares soaring 15%.

Financial Reality Check

The numbers paint a stark picture of WPP’s challenges. The company reported a 3.6% drop in comparable revenue to £13.6 billion for 2025, with profit before tax falling 26% to £1.1 billion. Performance at its ad agencies worsened in the fourth quarter following client losses in the US and UK, further weakness in Europe, and declines in China.

WPP slashed its dividend for 2025 by 62% to 15p per share. The company’s market valuation has collapsed from £25 billion just nine years ago to under £3 billion today. Shares fell more than 6% following the announcement.

Forward guidance offered little immediate relief. WPP forecast like-for-like revenue this year below analyst expectations, estimating a “mid- to high single-digit” drop in the first half with “an improving trajectory” in the second half. The company pointed to recent contract wins from Jaguar Land Rover and Estée Lauder as signs of momentum.

What Comes Next

The restructuring represents the most significant transformation in WPP’s history since its formation in the mid-1980s. The steepest previous cuts came during the 2009 advertising recession (7,200 jobs) and the 2020 pandemic (7,000 jobs). The current plan suggests cuts of potentially similar magnitude.

Rose has identified several assets for divestment, though she declined to name them. The savings will be reinvested into “high-growth” areas, with the enterprise solutions division positioned as the vehicle for AI-driven transformation services.

For the advertising industry, WPP’s move signals a broader reckoning. As AI capabilities advance, traditional agency models face existential questions about value proposition, pricing structures, and workforce composition. Whether WPP’s bet on becoming “AI-enabled” can reverse its decline—or merely slow it—will be watched closely by competitors, clients, and investors alike.

This article was reported by the ArtificialDaily editorial team. For more information, visit The Guardian.