WPP expects to pay considerably more to staff in bonuses in the half year to December as the global advertising group re-sets its business for growth.
Incentives were cut under previous CEO Mark Read as account losses mounted and growth went backwards.
WPP’s new CEO Cindy Rose has been recasting incentives, with common goals across all of the four new divisions she has created.
“We’re moving from a holding company model to a single company model – with four operating units, Creative, Media, Production and Enterprise Solutions, that operate across four regions, with common incentives aligned to WPP's overall performance, all underpinned by WPP Open which enables and connects everything we do,” she told analysts in a briefing on first half results.
In the half year to June, staff incentives increased to 2.7% of net sales from1.2% in the same six months last year.
This translated to a 120% jump to £130 million.
WPP expects this “rebuild of incentives” to ramp up in the half year to December.
“We did start to rebuild our incentives in the first half but ... they're very much skewed to the second half,” said CFO Joanne Wilson.
“Last year, because of our performance, our incentives were at an unusually low level.
“In 2026, as part of our planning assumptions, we are assuming that we will rebuild our incentive pot and we've done some of that in H1 and we'll carry on with that rebuild in the second half.
“Certainly, they will be higher than they were in 2025 is our current expectation, and probably closer to levels that you saw in 2024.”
WPP’s June quarter results revealed more red ink, driven by past account losses, but the company sees progress on its turnaround.
Revenue less pass-through costs in the June quarter was down 2.3% to £2.485 billion on a reported basis and 2.8% like-for-like, better than the -6.6% of the March quarter and beating analyst expectations.
The half year numbers also beat the company's own expectations of a fall of "mid to high-single digits".
For the half year, revenue was down 4.4% to £6.373 billion on a reported basis and down 3.2% like-for-like. Revenue less pass-through costs fell 4.7% to £4.745 billion like-for-like.
“I am encouraged by our first-half performance which is in line with our expectations,” said Rose, announcing the results.
“While legacy account losses continue to weigh, Q2 (June quarter) saw a further sequential improvement in LFL (like-for-like) growth, highlighting the momentum we are building across the company and demonstrating that our strategy to become the trusted growth partner for the world’s leading brands is beginning to deliver.
“We are firmly on track with Phase 1 of our Elevate28 plan to stabilise the business. Our objective for the first half was to put in place the building blocks of the new organisational structure and this is now complete.”
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