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A dark anecdote is circulating in the advertising world that a Kent-based basketmaker acquired four decades ago as a vehicle to construct a worldwide marketing powerhouse might survive longer than the empire it produced.

For many years, the financial success of WPP – with its one hundred thousand employees servicing global clients from automotive giants to Coca-Cola – stood as the business manifestation of Britain's renowned reputation for creative advertising.

WPP has been home to some of the most renowned agency networks, producing globally resonant campaigns such as Dove's Real Beauty, which challenged conventional depictions of women.

Among WPP's iconic campaigns are the unlikely pairing of a punk rock icon with a dairy brand, and decades of work for Coca-Cola, including the innovative idea to replace its logo on bottles with individual first names – a global phenomenon still on shelves twelve years later.

But now, as WPP fights to stop a increasing departure of clients worth massive sums and confront an critical competition to match the artificial intelligence and analytics power of rivals, there is previously unimaginable talk of a split.

"WPP ruled the world at one point, it was like the global powerhouse," noted one industry executive. "It was symbolic of UK success and the country's status as the global home for advertising."

Chapter Closes on Leadership Tenure

In August, a earnings alert and dire forecast of revenue decline for this year sent WPP's shares crashing to their weakest point since the 2008 financial crisis, marking the end of a brutal seven-year tenure as chief executive.

A stock market value of just £4 billion – compared with its £25 billion valuation eight years ago, when WPP was the world's largest marketing services company – has left the business at risk of being removed from the FTSE 100 index it joined almost three decades ago.

"One more earnings alert could push it out and WPP is up against it," said one media analyst. "The situation WPP finds itself in now is hard to imagine. WPP is extremely vulnerable, it is potentially facing a takeover or breakup."

For WPP's board, the last trigger came when a significant customer informed the company that it was parting with its $1.7 billion global business. The chief executive stepped down that Monday morning.

Strategic Shifts and Brand Consolidation

The departed CEO's strategy was to streamline a sprawling operation to create – or give the appearance of creating – a group fit for an AI future. The move saw the phasing out of some of the most famous brands in advertising.

"It was a drastic overhaul of names that were linked to 'traditional' advertising, it was a chaos," said a former senior from a WPP agency. "He killed off the brands. Clients certainly didn't understand why treasured trophies had to go."

Others contend that the departed leader has laid the groundwork for a turnaround and that WPP's decline was already apparent under the founder. Its market value fell significantly over the founder's last year in charge.

WPP has been investing £300 million annually in AI tools to enable it to make ads more cost-effective and more quickly and has 70,000 employees using its technology system.

However, concerns are mounting among the rank and file over job cuts with AI poised to take over large portions of the company's creative, media and data processes.

"The place where the fear is most pronounced is at junior levels, in starting roles where you come in and learn the business," said one staffer. "Grunt work, data, consumer insight: AI can write you a competitive review with creative included in it and market segmentation in 2.5 minutes. That would have been two weeks work for two or three graduate-level people."

Tough Competition

In the ad market, WPP is being heavily outgunned – principally by France's competitor, which took its crown as the biggest ad group in the world by revenue last year.

The competitor has seen its share price increase almost 200% in five years, giving a market value of €21 billion. It is led by a apparently tireless leader who is described by more than one industry executive as reminding them of "the founder in his prime."

US-based rivals have each seen their shares appreciate just more than 50% over the same period, with substantial market capitalisations.

New Leadership and Recovery Plans

WPP has asked a ex-Silicon Valley leader to engineer a turnaround.

Earlier this month, she unveiled a five-year $400 million partnership with a major technology company to embed AI products into WPP's technology platform.

The new CEO, who has also worked at major media companies, is said by insiders to have been "client-obsessive" in constant meetings in New York and London.

"She is not here to glaze anything," said a source who has spent time with the new CEO since she took over. "She is very realistic about the challenges and is determined to move fast to turn it around."

Given the state of WPP's business, analysts believe she may have only a year to save it. The previous CEO sold off assets including a market research group and used the proceeds to help pay down debt.

However, lower operating profits – down 35% year-on-year in the first half of 2025 – raise doubts about WPP's "interest cover" – a measure of a company's ability to pay down debt. Of more fundamental concern is an operating margin that fell from 11.5% in the first half of last year to 8.2% in the first six months of 2025. By comparison, the figure for its main competitor is just more than 18%.

"I cannot ever remember margins being anywhere near as low as that," said one analyst. "It is alarming really. With the new CEO they have gone for the tech industry approach. She will be given a year to work out whether there is a tech turnaround story here, if not the board will instruct her to break WPP up."

Investment Interest and Future Prospects

Despite the significant challenges on WPP, there are signs that investors believe the business may have reached bottom and be set to bounce back.

WPP Media, which manages more than $60 billion in global media investment in campaigns for clients, has always been the revenue and profit driver for the company. WPP Media on its own is worth more than the approximate £7.5 billion enterprise value of WPP, which includes its debt.

A number of investment funds have boosted their stake in WPP, sensing a opportunity as change looms under new leadership, but the question is whether the ad giant can convince clients and investors quickly enough.

"Investors are scared of being on the wrong side of AI," said one financial source. "It is the biggest theme in markets globally. It feels as though WPP is on the wrong side of that trade at the moment.

"Advertising clients are unpredictable, there is a domino effect to winning and losing. The worry is that the decline is baked in. But change comes when you are on the brink of disaster. I would never count WPP out."