Advertising Age republished Bloomberg News content reporting WPP is dropping out of the FTSE 100—the UK’s premier stock index—as the beleaguered White holding company continues its financial and professional death spiral.
At this point, WPP is seemingly being held together by flimsy wire and plastic products. As well as professional hucksterism and political lies.
WPP to exit FTSE 100 as client exodus, AI threat pummel shares
WPP Plc’s residency in the UK’s premier stock index is ending after a client exodus and fears over competition from artificial intelligence pushed the group’s shares to their lowest level in more than two decades.
The advertising firm’s place in the FTSE 100 will be taken by British Land Co. after the close of trading on Dec. 19, index provider FTSE Russell said in a statement Wednesday.
Founded by Martin Sorrell, WPP has been a constant member of the FTSE 100 since the summer of 1998. It has twice cut its sales growth target this year and has undergone a management transition, with former Microsoft Corp. executive Cindy Rose taking over the top job in September. Rose succeeded Mark Read, who retired after a seven-year tenure.
The stock has fallen by nearly two-thirds this year, hitting a 1998 low in November and leaving the company with a market value of around £3.1 billion ($4.1 billion).
Competition from artificial intelligence tools is pressuring WPP’s business, causing concern among investors that large corporates may prefer to build their own in-house teams for creative designs. Big tech firms are also entering the fray, with Meta Platforms Inc. and Alphabet Inc.’s Google rolling out products helping smaller businesses create automated ad campaigns.
A string of high-profile client losses has added to the company’s troubles. WPP lost packaged food giant Mars Inc.’s $1.7 billion ad portfolio to rival Publicis Groupe in June. Other setbacks include Pfizer Inc. pulling assignments since 2023 and failure to win a U.S. contract with Coca-Cola Co. in North America this year.
A recent speculative rally failed to save WPP from relegation. The stock jumped on Nov. 17 after a report that Havas had expressed interest in buying part or all of its rival, but has since surrendered those gains following the French firm’s denial.
As of Tuesday’s close, WPP’s market value had plunged to 117th among the UK’s biggest listed companies, according to data compiled by Bloomberg. FTSE Russell’s rules state that a FTSE 100 member is automatically demoted in a quarterly review if its ranking falls to 111 or below. Being dropped from the index can trigger selling by funds that track the gauge.
British Land returns to the blue-chip index, having yo-yoed in and out of the gauge as rising interest rates hit the value of its real estate investments. WPP would ordinarily have been replaced in the benchmark by Spectris Plc, but the precision testing company is in the process of being acquired by KKR & Co.
—Bloomberg News
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