The industry’s largest holding company reported positive growth for Q3, in its most positive earnings report in some time.
WPP reported revenue growth of 0.5% for Q3 of 2019, which it attributed in part to improvements in North America and China, as well as among globally integrated agencies.
“WPP’s performance in the third quarter is another important step in the strategy we outlined in December 2018 to return the company to sustainable growth in line with our peers in 2021,” WPP CEO Mark Read said in a statement. “Our growth in Q3 is encouraging but we are focused on delivering these longer-term goals and know there will be twists and turns along the way.”
The holding company reported $3.9 billion in net new business for the first nine months of the year, with Read citing major wins such as eBay and Mondelez while adding, “just as importantly, we are growing and retaining longstanding clients, such as the U.S. Marine Corps and Centrica, who value the depth of our understanding and the longevity of the relationship.”
The earnings report does follow a setback for WPP, as Johnson & Johnson elected to send its U.S. consumer health business to MDC Partners’ Doner this week. WPP’s media agencies have performed fairly strongly in the U.S. this year. GroupM brought in $372 million in net new business revenue in the U.S. over the first half of the year, according to data consultancy COMvergence, second only to Dentsu Aegis Network’s Carat.
It also comes as WPP prepares to complete its sale of a majority stake in research firm Kantar to Bain Capital.
“Yesterday, WPP shareholders voted to approve the Kantar transaction, which will further simplify our business and significantly strengthen our balance sheet, while creating a new partnership for Kantar’s future growth and development,” Read said in a statement.
WPP’s stock price opened at $62.75 today, up about 5% from yesterday’s close at $59.25.
“Despite static organic growth around .5% WPP’s quarter over quarter revenue growth of 3.5% is evidence the company’s strategy is starting to take effect,” Forrester principal analyst Jay Pattisall told Adweek in a statement. “Mark Read indicates they are focused on showing more evidence of the turnaround in 2021. I would anticipate some bold moves in 2020, such as consolidations to strengthen their growing digital experience, commerce and media business.”