WPP to invest $318 million in AI technology, expects flat revenue growth in 2024 : Report

According to AdAge, WPP plans to invest $318 million annually in AI technology, but expects minimal revenue growth in 2024 and may eliminate some jobs to cut costs. The company expects 2024 revenue less pass-through costs to remain flat to up 1% from 2023, and 2023 revenue to rise 0.9%.

CEO Mark Read predicts an acceleration of revenue into 2025 due to a strong new business pipeline and a similar macro environment in 2023. WPP plans does not specify the duration of the $318 million annual investments.

“We’re going to paint not just a vision of the future, but how it’s operational today, how we’re using it to augment our creativity, how we’re using it to produce finished work for clients,” said Read.

WPP has completed its restructuring process, affecting its six networks, which now account for 90% of its revenue. The changes will cost the holding company over $158 million this year but will save the same amount in 2025.

WPP plans to save over $221 million through efficiency opportunities in its back office and other business areas, including restructuring. The company will face some redundancies, but details are not available at this time. Grey, part of the AKQA network, experienced layoffs earlier this month, but WPP declined to comment on the layoffs.

WPP has announced a $326 million AI investment, following Publicis Groupe's announcement of a $326 million investment. The move comes after Publicis introduced CoreAI, a tool to improve employee workflows across creative, media, software, operations, and insights.

WPP Open, an AI platform used by 28,000 employees, is being used by clients like L'Oréal, Nestlé, and Mondelēz. Read believes AI will enhance human creativity and create new jobs. While the impact on jobs is yet to be determined, increased productivity will make the business more efficient and deliver higher ROI to clients.