WPP (LSE:WPP) Q3 2026 Earnings Call

0:00 Good morning everyone and thank you for joining the WPP Q3 2026 trading update call. My name is Melanie and I will be coordinating your call today. During the presentation you can register a question by pressing star followed by one then another one on your telephone keypad. To withdraw your question please press star one and one again on your telephone keypad. For those on the webcast, you can also ask questions via the dedicated Q&A box. I will now hand over to Thomas Singlehurst to begin. Please go ahead.

0:37 Thank you, Melanie. Good morning and thank you for joining us for WPP's third quarter trading update. I'm Tom Singlehurst, WPP's Group Director of Investor Relations, and joining me today are Cindy Rose, our CEO, and Joanne Wilson, our CFO. I hope you've had the opportunity to read this morning's press release together with the accompanying presentation and disclosures. As always, I would ask you to read the cautionary statement which is on page two of the slide deck very carefully. Before Joanne takes you through the numbers in detail, I'll hand over to Cindy for some opening comments.

1:10 Brilliant.

1:11 Thank you, Tom. Good morning, everyone.

1:13 I wanted to offer a brief perspective on our progress before Joanne takes you through the detail. We are less than a year into our three-year Elevate 28 plan to return WPP to consistent and sustainable growth. We continue to make progress and I'm encouraged by the improved momentum in the third quarter. We are reiterating our full year guidance and we remain laser focused on disciplined execution of the Elevate 28 plan. Our Q3 revenue was up 0.5% both reported and on a life-for-life basis while net sales declined by 2.1% light for light, reflecting further quarterly sequential improvement. This was driven by a return to growth of WPP media for the first time since 2024, led by our U.S. media operation, which is strategically significant and really wonderful to see. WPP production also saw 2.5% growth in the quarter.

2:14 WPP Media began its transformation a year before we launched Elevate28 with WPP production following close behind. And we're now realizing the benefits of those changes, which gives me confidence that the rest of the business will follow a similar trajectory. That momentum moves us firmly towards the build phase of Elevate28 and strengthens our foundations for a return to growth sometime during 2027. Our singular focus on execution excellence is resulting in improved new business performance and client retention, contributing to the sequential improvement and growth that we're delivering in the second half. At the same time, we are operating more efficiently and creating greater capacity to invest in our outstanding talent and the capabilities that will drive our future growth.

3:05 The third quarter gave us a lot to be encouraged about. We secured new client assignments and significant client retentions, including successfully winning a competitive pitch to renew our long-standing partnership with the Coca-Cola Company for global media, data, tech, and creator marketing in every market we competed for, as well as continuing to serve as the company's global creative partner. We also expanded our global media partnership with DoorDash, building on an eight-year relationship that now encompasses more than 40 markets worldwide. We were appointed as the media partner across North America and EMEA for Alphabet's Waymo, leading strategy, planning, and buying, including for the driverless car brand's Super Bowl debut. In Greater China, we're bringing together talent, technology, and AI through WPP Open China to deliver Nestle's first fully integrated content model.

4:00 Other notable client wins included a partnership between AKQA and TurboTax, engaging the next generation of taxpayers through digital content, God Reg Consumer Products Limited consolidated its international media operations with WPP Media across Indonesia, Bangladesh, Sri Lanka, South Africa, Nigeria, Argentina, and Chile under a single connected model. And WPP was also named the integrated agency partner for the Electoral Commission in the UK, leading voter communications across Great Britain. These wins reflect the creativity, the deep expertise and determination of our teams and the trust and confidence that our clients have in WPP's ability to drive brand differentiation and business growth at a global scale.

4:48 We're also investing in the future with confidence. Last month, we opened Devon's Point, our new state-of-the-art AI-powered global flagship production facility in East London. Devon's Point was built from the ground up to support the modern demands of global brand marketing and offers our clients large-scale virtual production sets, dedicated creator facilities such as live streaming studios, rapid shoot and edit facilities, collaboration spaces, and multiple AI-enabled post-production technology suites. We also continue to strengthen our partner ecosystem, welcoming almost 50 additional data partners to WPP Open Intelligence including for example IOTA whose audience data and technology bring deeper insights more precise consumer targeting and enhanced omnichannel performance. This takes the total number of data partners to around 400 further strengthening the open differentiated ecosystem that is central to our long-term data strategy and a source of competitive advantage for our clients.

5:53 We also expanded our strategic partnership with Kindrel to accelerate enterprise AI transformation and bring new innovations to our shared clients. As part of this partnership, WPP was named Kindrel's global media and marketing partner, delivering a broad portfolio of integrated services powered by WPP Open, our agentic marketing platform. On the people front, we announced a few leadership changes last month. Joanne will step down as CFO in 2027 and I want to take this opportunity to recognize her contribution to WPP over the years. Joanne's leadership has helped position us for success as we deliver on the first phase of Elevate 28. The process to identify and lease CFO is well underway, and I know that Joanne is committed to a smooth and orderly transition once her successor is identified and on board.

6:43 We also celebrate John Cook's, oops, excuse me, we also celebrate John Cook's remarkable 30 years at VML before he leaves us next year. Looking ahead, I'm excited to welcome Tyler Turnbull from McCann as global CEO of WPP Creative, while Eric Campbell, currently CEO of VML North America, will become global CEO of VML. And to help us further deepen our trusted client partnerships across our largest WPP clients, Adam Gearhart has been promoted to Chief Client Officer. I'm excited about the leadership team we're building. This caliber of talent brings the energy, experience, and leadership needed to help us accelerate the next phase of our strategy.

7:28 Alongside these investments, we continue to strengthen our financial foundations. We're on track to deliver the targeted 100 million pounds in-year cost savings, and we continue to make progress on asset disposals and expect to generate more than 200 million pounds of proceeds this year. Together, these actions are creating a stronger platform for sustainable growth. Look, transformation at this scale isn't easy, and the benefits do not materialize overnight. It takes time. and progress may not always be linear, but I am incredibly proud of what our teams are delivering. They are performing and transforming with energy, enthusiasm and commitment. And that fills me with confidence that we will continue to see progress reflected in the lead indicators that we set out back in February.

8:18 So as I said earlier, we're less than a year into our three-year Elevate 28 plan to return WPP to sustainable, consistent growth We still have a lot of work ahead of us, but we continue to make progress and I'm encouraged by the commercial momentum we're delivering. We are reiterating full year guidance and we remain laser focused on disciplined execution of the Elevate 28 plan. We'll share a fuller update on our strategic progress when we report our preliminary results in February. And with that, let me now hand over to Joanne to take you through the details of our third quarter performance.

8:53 Joanne? Thank you, Cindy, and good morning, everyone. So let me share some detail on our third quarter financial performance and then of course we will open the call up for your questions. I'm starting with our operating performance in the third quarter and slide it. Life-to-life revenue, less pasture costs, excuse me, fell 2.1% in the third quarter, while organic revenue growth, a metric which may ease comparability across a peer set, was up 0.5%. Both figures represent further sequential improvements in the second quarter and were in line with our expectations. The impact from both M&A and FX was negligible, with reported net revenues moving more in line with organic trends and down 2%. You will see further detail on performance by business unit, region and client sector on slide 9 of the presentation, but I would call out the following features of performance in the third quarter. By business unit, WPP Media saw a return to growth of 0.3% in the third quarter. This compares to a decline of 8.3% in the first quarter and a decline of 2.8% in the second quarter.

9:58 While we note the impact of easing comparables and some timing benefits, we are encouraged by this performance, especially as it continues to include a significant impact from growth account losses. We are seeing an improving contribution from new business wins. However, the net impact of new business for WPP Media remains a drag on our life-for-life performance. Looking at the non-media businesses, WPP Creative was down 5.1% at its area in rate of decline versus the second quarter, which was down at 3.5%. This was primarily driven by lower client spending, partially offset by the ramp-up of new business. Within this, brand and design continues to post good growth, while PR also returned to growth in the quarter, despite pressures in the Middle East.

10:43 WPP Production delivered another quarter of positive growth, with like-for-like of 2.5%, A sequential quarter-and-quarter acceleration on the 1.3% growth in the second quarter. By geography, the shape of performance is still distorted by the impact of gross account losses, which weighed most heavily in North America and in the UK. Encouragingly, both of these markets were still in negative territory, down 1.8%, and with 2% respectively, are tracking much better quarter-and-quarter. At the same time, we are encouraged to see both Germany and India return to growth. By contrast, China was down by single digits in the Q3. However, the year-to-date trend represents a stabilization relative to the last couple of years. Given ongoing geopolitical uncertainty, I want to mention performance in the Middle East, which represents just under 2% of our business.

11:34 This region was down around 13% in the quarter, an deterioration on the second quarter and continues to be a source of uncertainty into the fourth quarter. By client sector, as discussed at both the first half and in the first quarter, trends in areas like CDG and tech continue to be impacted by client assignment losses, albeit Q3 has seen an improving quarter-on-quarter performance in both of these client sectors. Excluding this, we continue to see a high degree of polarisation between and within sectors. We note, however, that in the third quarter we have seen continuing growth within both healthcare and auto. And turning to growth through the lens of our largest clients, the Q3 like-for-like decline to the top 25 clients was 2.7%, which I've mentioned includes the impact of specific client losses.

12:23 Excluding this, Q3 performance for that group was positive. Turning to our balance sheet, and you can see the detail of where net debt stands at the 30th of September on slide 10. Average adjusted net debt at £3.2 billion continues to come down, both year to date and year and year albeit somewhat assisted by the beneficial impact from IFRS 9 amendments which were effective from 2026. Since our interim results we've repaid the 750 million euro bond which matured in September and this takes our weighted average maturity back about six years. Also note that given successful issuances in December last year and March this year all of our debt charities are covered through to 2028. I would like to re-emphasize that creating firm financial foundations is a core tenet of the Elevate28 plan and at the root of this is a commitment to maintaining an investment grade balance sheet. To this end, as we indicated in February, we have initiated processes to assess the potential sale of certain portfolio assets and continue to expect proceeds from disposal related activity of at least £200 million in 2026.

13:32 Those processes continue to advance as planned and while we do not have any additional comments to make on them today we will update in due course as appropriate. And finally turning to guidance on slide 11. Taking a balanced view of the outlook we reiterate our guidance for like-for-like revenue less pass-through costs down low to mid single digits in the second half with Q4 like-for-like expected to be towards the better end of this range. Looking to 2027 we will not set formal guidance until the prelims in February That said, consistent with the guidance we gave at the launch of the Elevate28 strategy earlier this year, we do continue to expect a return to growth during the course of the year. Turning to headline operating profit margin, again we are reiterating our guidance for a full year margin of 12 to 13%, which is consistent with second half margins decreasing by up to 200 basis points year-on-year. We are on track to deliver £100 million of in-year structural cost savings as part of our Elevate28 strategy, and as intended we are reinvesting these savings into growth drivers including the rebuilding of incentive pools looking beyond the net sales and margin guidance we continue to expect to deliver adjusted operating cash flow free working capital in the 800 to 900 million pounds range as a reminder this excludes the anticipated restructuring costs associated with the elevate 28 program and historical restructuring programs Excluding these, we would anticipate adjusted operating cash flow before working capital of between 1 and 1.1 billion pounds.

15:04 As mentioned, we expect the overall impact of disposal related activity, some of which will come by direct disposal proceeds and some by associate dividends to contribute at least 200 million pounds to our cash flow in the full year. We continue to expect the improvement in average adjusted net debt to be sustained across the balance of the year. So that wraps up the formal part of our presentation and both Cindy and I will now be delighted to take your questions.

15:31 Thank you, Joanne. We'll now begin the Q&A session. In terms of housekeeping, if you could please state your name and your organisation before you ask your questions, that would be very much appreciated. Please note for those joining via the webcast, there is an opportunity to type in questions. We will aggregate these and I will run through them at the end of the Q&A session. But with that, Melanie, can you open the line for questions, please? Thank you. To ask a question during the session, please press star 1 and 1 and wait for your name to be announced. To withdraw your question, please press star 1 and 1 again. For those on the webcast, you can also ask questions via the dedicated Q&A box. And our first question comes from the line of Ciaran Donnelly from Citi.

16:22 Please go ahead, your line is open.

16:27 Yeah, thanks a million guys. It's Ciaran from Citi. A few questions for myself. One, maybe for Cindy, just in terms of client conversations you've been having. uh recently what's the kind of outlook into 2027 what's the tone of those um conversations um i guess just in terms of maybe quantification in terms of net new business for 2027 i know you guys don't give a number for the contribution but just directionally where are we now versus perhaps where we were at h1 um and then to just in terms of the reiteration of the margin guidance Can you just talk us through the dynamics within that range?

17:12 What are the puts and takes and how should we think about that? And then finally, just in terms of a couple of quantifications, you called out the top 25 performance excluding losses was positive. Could you give us a number for that? And also just in terms of timing benefits, you called out in WPP media, if you could just give us a sense of the size of that benefit. Thanks.

17:37 Thanks, Karen. Why don't I kick off with client conversations and tone, and then I'll hand to Joanne on numbers. What I will say, Karen, is I'm genuinely more excited about the opportunity I see today than I was even a year ago. And I think transformation at the scale that we're undertaking here clearly takes time to flow through to the numbers and No one is more impatient than I am to see that happen. But I spend time with clients every single day and what I can tell you is that they're responding very positively to the changes that we're making. Why? Because we're showing up as one unified company and we're able to present the best of WPP, not hundreds of different agencies.

18:24 So we can offer our clients the right talent to the right client at the right time without historical agency constraints. and now that the vast majority of our pitches are integrated, the old WPP just wasn't set up to keep pace with the evolving needs of clients in that way and now we are. I think our new business wins and client retentions continue to be an important lead indicator of the progress that we're making and we're seeing improving trends on both that demonstrate that we're on the right track and the tone and conversations I have with clients really validate that. So Joanne, do you want to pick up on net new business numbers margin? Yes, of course.

19:09 Good morning, Karen. Thanks for the question. Yeah, let me start with the margin guidance. They're very similar to the messaging in August. We do have a declining top line this year, and obviously that has some impact on opportunity leverage. But if you look at some of the drivers within the margin, we talked about structural cost savings this year of £100 million, very much on track to deliver those. We also talked about the importance of getting back to sustained growth as part of Elevate 28 and that we would invest in areas like media, data, commerce, enterprise solutions where we saw opportunities to do so. And we indicated that all of those structural cost savings would be reinvested back into the business this year. And alongside those areas of growth, we are also investing in rebuilding our incentives. And that's really all reflected within the margin guidance of 12 to 13%. I would also just point out that This year, we've seen renewed momentum in new business, which is very encouraging.

20:08 We also have the impact of historic client losses. And in our industry, as you're ramping up new business wins, of course, you have all of the costs sometimes even before day one, and it takes time, often three, six, nine months in some cases, to ramp up to the full revenue from those wins. So there is a little bit of that dynamic in the year, and that's reflected in the margin as well. In terms of the top 25, it was encouraging to see, excluding the losses, that we're back in growth and that growth was around low to mid-single digit. As Cindy said, an area of continued focus for us. In terms of the media performance, we're very encouraged with the growth in Q3. I think it reflects the work that Brian and the team have been doing over the last number of years. I wouldn't get too focused on Okay great, thanks.

20:58 Thank you. Our next question comes from the line of Nicholas Langlett from BNP Paribas. Your line is now open. Please go ahead.

21:37 Yes, good morning everyone. So I've got three questions, please. First, to come back on the net new business, by how much the net new business improves in Q3 relative to Q2, and what do you expect for Q4? And also based only on the wins and losses already known, do you expect a positive or negative net new business entering 2017? Second question on media, so can you quantify the timing benefits in Q3 and whatever you expect that to fully reverse in Q4? And lastly on creative, so what is driving the lower client spending from existing clients in Q3? Are you seeing clients buying fewer services or the same for fewer build hours? And which fix are you pursuing to improve the trend?

22:24 And basically, when do you expect the creative to return to positive like format? Thank you.

22:30 Thanks, Iglesias. Why don't I take all of those? Just on the net new business, we talked in August and indeed at the start of the year that we expect our growth client losses to have an impact of 500 to 600 basis points and that we were towards the top end or at the top end of that range, which remains the case. We are very encouraged by the momentum that we've seen in new business lanes this year and of course we're ramping those up as we go through the year. and I talked about um easing drive from that new business you know from h2 from h1 sorry into h2 and we expect that to continue in terms of q3 we did see an easing of the the net new business drive versus q2 and of course that helps with that performance and in fact um very pleasingly we saw an acceleration of some of the ramp up of the of the new business in q3 as a result of that I expect the net new business uh impact to be similar across Q3 and Q4.

23:29 I think I mean it's too early to talk about the impact of net new business on 2027 but I think you know the focus is on new business, it's on client retention and it's to continue to see an improving trend on the net new business. I would just like you know the worst I'm lost is Q2 Q3 then of course we will carry into 2027 but that is not unusual at all. and I wouldn't expect to see anywhere near the level of losses that we were carrying into 2026. In terms of the media timing, I'll just repeat what I said before. Don't focus too much on the border. You'll get on an H2 versus H1. I do expect all of that timing benefit to unwind in Q4. It was important enough to call out, but not material in terms of media's overall performance in Q3.

24:19 On creative and the lower client spending, Again, if you look at the performance in the first half, the performance in Q3 was broadly in line with that down mid-single digits. If I'm being creative, I think it's important to call out that we did see Burson get back to growth in the quarter and we saw continued strong growth across our brand design agencies, including Landor, which is very much encouraging. The lower time spent is, you talked about polarisation spend across and within client sectors. and that's reflected really on that creative number. Now we are seeing a wrap up to new business. I would call out that the creative teams have done a very good job this year on improving their win rate year in year and they're ramping those wins up and will continue to as we go through the balance of the year. I mean I think it's important to call out on Q3 that you know WTP Creative and the team there have gone through a significant redesign of their operating model this year and yet again they've done that brilliantly as they always do but nonetheless you know the big lift in terms of the changes across the business are really in Q3 and while the team are very much focused on making sure there's minimal client impact from that which there was undoubtedly that is a distraction for the leadership team you know away from the top line and I would say that that has probably had some small impact on that in Q3 as well.

25:48 Okay thank you Joanne. Our next question comes from the line of Julian Rock from Barclays. Your line is open please go ahead.

26:03 Yes, good morning. First of all, good luck Joanne in your next adventure. I'll come back, sorry, once again on Net New Business, probably last attempt. So gross towards the top end of 500 to 600 in terms of losses. uh gross wins were supposed to be better than last year 250 so now that we you know close to the end of the year uh can we have some more color on on how much better than than 250 uh that's my first question uh my second question is on burson back to growth uh can we have a a more precise number and also how much was it of net sales in uh in q3 or nine months And then finally for Joanne, what is the number one item to address, the number one problem to solve that you are living in your success as Intrae?

26:59 Just one, just one, because I'm sure there's a long list, but just one.

27:02 Okay, I might answer that last question positively, Julia. So on the net new business, The gross losses, let's say 600 basis points, as you said last year, gross wins were 250 basis points. And I think the team has done a super job this year on the win rates. And as a result of that, the gross wins will be significantly better than they were last year, but not enough to offset that gross loss. So I am still expecting in Q4 that the net new business is a drag, albeit an easing drag, versus H1. in the final quarter of the year, but still negative. In terms of Burson's growth, I would say that what was the driver of it, that we saw particularly strong performance in the US. I'm very much encouraged by the turnaround in that business versus where it was last year.

28:03 The growth was low to mid-single digits. and PR overall is around seven percent of our of our net sales and and then in terms of um in in terms of you know what my the scale of um persons what are the questions yes and you know I think it's also important just in the context of that Burson performance to call out the Middle East because the Middle East we've said is 2% of WPP's overall net sales but from Burson it's a higher percentage so in the context of that and we saw a step down in the Q3 in the Middle East I think it's important to call out the job that the Burson team are doing you know it's very strong so look Julian I'm not trying to avoid your question but I think in terms of where the businesses are at today I think the entire team at WPP have worked incredibly hard over the last you know three three and a half years and to simplify the business and you know to turn around the performance that we saw over the last few years and as part of that simplifying you know our corporate functions as well and the team is I have a brilliant team here and so whoever comes in will be inheriting that so they're very fortunate and I think it's a much easier job to inherit than perhaps the one I did three and a half years ago. So, you know, I think there's all to play for.

29:29 It's a fantastic time to join the business and, you know, we're all on track to deliver Elevate 28. So, you know, continued, driving continued momentum I think will be the focus in supporting Cindy and the rest of the executive team do that.

29:45 Okay, thank you. And our next question comes from the line of Adam Berlin from Goldman Sachs. Your line is now open. Please go ahead.

30:02 Yeah, good morning, everyone. Just one question left, really, on costs. So I'm just, you know, you talked about a £500 million cost savings from Elevate 28. £100 million of that has come in 2026. Can you give us any sense of how much of the remaining 400 million will come through in 2027? Just as we're starting to think about 2027 margins and what areas could that be reinvested or how much of that could actually drop through to the bottom line next year? Thanks.

30:37 Okay, thanks Adam. So yes, you know, very much on track to deliver the 500 million of structural cost savings 328 and we'll deliver 100 million in year and the annualized impact will be 250 million and 27 so another 150 million coming through from the actions taken this year and of course there will be further actions on the corporate functions next year which will which will add to that 150 million you know I think it's important to you know to take you back to February and Cindy and I talked about our priorities to get the business back to sustained growth and we will invest in a disciplined way to do that across growth drivers so that is media It's in our data proposition, it's across enterprise solutions, it's across commerce and some sectors where we see big opportunities for us to take share in some cases. It's too early to say how much of that will be reinvested in 2027, but we'll give more detail in February.

31:38 Okay, thank you very much. And our next question comes from the line of Adrian de Saint-Hilaire from Bank of America. Your line is now open. Please go ahead.

31:55 Yes, good morning, everyone. Just extending my gratitude to Joanne for all your help over the years. My question is actually probably more for Cindy, in fact, but I know it's super difficult to talk about individual clients, but I'd be interested to hear about why WPP did not participate in the US pitch for Coke. Secondly, some of your peers are talking about winning assignments without pitching.

32:19 Is that also something that you're observing?

32:22 Then I'm very sorry, Joanne, I've got a bit of a boring question. Is there an impact on the interest costs from higher rates? And can you talk about where you see net debt and average net debt ending for the year?

32:35 Thanks, Adrian. Appreciate your question. So let me jump in on Coke, first of all. We are delighted, needless to say, we're delighted with the outcome of that process. It was rigorous and fiercely competitive and, you know, we were appointed in every market we competed for and I could not be prouder of my team for the fantastic result that they delivered during SIPA World Cup for the Coca-Cola Company and also how they performed during the pitch process. We didn't participate in the North America pitch, that is correct. mostly because we won the rest of the world and we have a huge amount of work to do in a very short period of time. I had people, many, many, many people pitching for many, many, many weeks over the summer. I was with them myself in London and Shanghai and Mexico City and we made a tough call between spending yet another six weeks pitching for North America versus delivering against what we had already won. It was a fine judgment call which I made and it's as simple as that really. So that is your question on Coke North America. I hope that answers it. The other question you had was this pitchless CEO handshake thing that I keep getting asked about.

33:50 What can I say here? Look, nobody loves pitching, right? You're not going to find anybody that says, I love pitching. The cost and burden of the process seems to be increasing. But I think what's really important to me is that my clients fully understand the implications of the decisions they're making. These are really high stakes decisions with material business consequences and they deserve careful consideration. I don't think we do ourselves any favor as an industry of professionals by encouraging clients to bypass proper due diligence. And I think I'll leave it at that. Joanne, do you want to comment on that?

34:28 Yeah, thank you for your comments, Adrienne. Just on interest, We are 90% fixed in terms of interest and we've done, you know, from a bond refinancing perspective, we have refinanced all our bonds by 2028. So I'm not expecting, you know, a significant impact from potential increase in interest rates going forward. And I would expect interest to trend on over the course of the 28th. In terms of our average adjusted net debt, it was down about 160 million at the end of September year on year and that was helped by IFRS 9. The adjusted net debt was actually down 600 million and I would expect to end the year with the average and actual adjusted net debt down as well.

35:15 Thank you. And our next question comes from Anna Patrice from Berenberg. Your line is open. Please go ahead. Yes, good morning.

35:30 Thank you very much for all the answers already provided. Just a follow-up on my side. First, once again, on creative enterprise solutions. I understand that creative has worsened. I understand some reasons behind, etc., But what about the enterprise solutions? Because it is within the creative. Does it mean that it also has slowed down further into three? Is it growing? Or what should we expect for the 2027? That's our first question. Second question on the quality of the WPP media return to growth. How much of this 0.3% came from timing and easier comparison? And how much from the wind jumping up? And then do you think that we will see kind of accelerating or at least positive growth of the media in Q4 and 2027?

36:24 And then the last couple of questions on the new business in the pipeline. Is there any significant accounts under review besides IKEA? And what could be the drag from the last three major contracts lost? in Q3. So what will be the track from new contracts for

36:49 2027? Okay.

36:52 That's it. Thank you.

36:54 Okay. Why don't I take this on? I think your first question, sorry, the line felt like it was enterprise solutions and you know its performance relative to creative look at as we said in February this year was really about establishing enterprise solutions as a standard on operating unit and and we intend to report enterprise solutions like for life from the 1st of January 2027 and so Jeff and the team have been very focused on standing up enterprise solutions as well as building out our go-to-market and so you know expanding our our channels to market from just through creative to having direct go-to-market capability in the business and also through partners. And we've made really good progress with that this year. We're not sharing the performance of Enterprise Solutions. As I said, we'll do that from the 1st of January.

37:40 But to just give you an indication, it was slightly better than overall creative. In terms of media and the quality of the performance, I would say that it is good quality performance. I think they did benefit a little bit from easing comps. I think it was about 1%. I've talked about the timing factors not being material but significant enough to call out and that they will unwind through the year. As I said as well, in terms of your question on positive growth in Q4, I don't want to get too fixated on quarter on quarter. I'm very encouraged by the progress that the media team are making despite the losses that they're still lapping and we're seeing that through a combination of new business wins but also growth from existing clients, particularly in the U.S.

38:26 and the team are very focused you know on the balance of year Q4 so obviously are always our biggest quarter so an important one and in 2027 we'll come back in February and update you on expectations then in terms of the new business and the pipeline look you're very encouraged by the pipeline it's been a busier year than last year which we were expecting just given last year there were fewer opportunities and I'm encouraged by our performance through that the pipeline is slightly higher than it was this time last year and if you recall Q4 last year it had been starting to build. You mentioned IKEA, look IKEA we are defending some revenues but there's also an opportunity for us to expand revenues and we've talked about this before we're seeing more and more opportunities within the pipeline being a little bit defensive but also big opportunities to expand and so really IKEA is the big one but there are a couple of others which include both opportunity and defending some revenues.

39:26 and again in terms of the losses and the drag into 2027 I'm not concerned about the drag of losses into 2027 it's not unusual to have those and you know I think the more important point is you know Cindy talked about it in August really focusing on client retention is a bit more that we need to do in that area and encouraged by the retentions in Q3, DoorDash and Coke but continued area of focus for us. Thank you. And our next question comes from the line of Steve Liechti from Deutsche Bank News. Please go ahead, your line is now open.

40:09 Yeah, morning. I've just got a couple left, please. Just on the fourth quarter, given the comp is easier by about one percentage point against the second and third quarter, and you're alluding to the improving trend in kind of new business relative to losses, is there any way that that fourth quarter could be positive? and then kind of aligned to that question other agencies talk about the fourth quarter being quite heavy on project-based business and give a sort of feel in terms of what the sensitivity there is but you don't tend to talk about it just remind me whether you're exposed to that and if you are kind of what the sensitivities are there and any kind of forward-looking statements you can make on what you're seeing on project-based stuff thanks

40:59 Yeah, maybe I'll start with the second question, Stephen, thanks for the questions. All of our peers, including us, have got a degree of project-based business within our plan. We don't call it out because it's just part and parcel of our business and we manage through it. and you know you see some volatility with that but you know we're probably seeing a stabilization in that this year versus what we saw perhaps you know in the last couple of years. In terms of Q4 that we we certainly expect Q4 to be at the better end of that low to mid single digit range and our performance here today I think it's important to say is very much in line with our expectations and you know we are building confidence and delivery what we said we would do we're also you know Cindy said very encouraged by the conversations that we are having with clients and all of that um it gives us the confidence that elevate 28 is the right strategy and we are executing well against it we do expect to exit 2026 where we were hoping to um and you know and that and that gives us confidence that we will return to growth during 2027 as we shared um in February you're right that the comp is one percent easier you know I talked about the acceleration of the new business ramp up in Q3 and I'd expect the net new business impact to be kind of more similar across Q3 and Q4 I think it's also important you said it Q4 is our biggest quarter and

42:30 so it's an important quarter most important quarter and if the macro environment remains very uncertain the geopolitical environment I think is increasingly uncertain and therefore you know our outlook is balanced and reflecting those dynamics But the team are very focused on closing the year. But as I said, just reiterate that expectation of low to mid single-digit decline in Q4 is where we're expecting it to be right now.

43:01 Great, thanks. And our next question is from Annick Maas from Bernstein. Your line is now open. Please go ahead.

43:14 Good morning. My question is on the economics of retained accounts. You mentioned Coke and Dash. Can you just tell us a bit more about how do retained revenues scope and expected profitability compared to previous contracts? Did you have to do pricing concessions or were there any additional investment commitments you had to do in order to retain those accounts? The second one is just... On the back of the creative leadership change, is there any accounts you feel you might actually have to work on harder just to retain them in light of the change of the leadership there? And then maybe just trying to ask Steve's question in another way, but how much of Q4 is committed in order to understand what are the remaining uncertainties besides of macro?

44:13 Thank you.

44:18 You can have a go at the first one and I'll take the second one.

44:21 Okay. I mean, thanks for the question, but we're not really going to get into the economics of, you know, retained clients and individual client accounts. You know, we are very disciplined around our commercials and, you know, we're very focused as well on making sure that those are aligned with our client outcomes and, you know, we take that into account and every client is different. Maybe I'll answer the last one, Cindy, and then you can take the point and create a relationship. In terms of the Q4 commitments, many of our client arrangements are multi-year arrangements that we have in place. As I said, Q4 is always the biggest, and you do tend to find that there are some volatility up and down in the final quarter of the year as many of our clients are closing out their year. as well it's not really the way we think or look at our business um and so you know i wouldn't want to give you an indication of how much that q4 is committed but just reiterated that you know we're confident in the guidance that we've given that we'll be at the better end of that loan smith single digit decline and in in the q4 yeah thanks and i mean i would just briefly comment by saying um that i don't i think what you're asking is

45:36 Are any of our clients at risk as a result of leadership change in WPT Creative? And the answer is no. There's no client relationships that I see that are at risk because our client relationships aren't tied to any one individual. We build long-term growth partnerships with a broad base of stakeholders within these client organizations. So I don't foresee any destabilization or risk as a result of leadership change. But thanks for your question.

46:07 Thanks. There are no further audio questions at this time, so I'll hand the call back to Thomas for any web questions.

46:19 Thank you, Melanie. Yes, so we've had a number of questions on the web. Some of them have been sort of already addressed by some of the answers you've given. One thematic question from Richard Kramer asking about iOS 17, he asks, you mentioned data partners, but with Apple taking steps to prevent ID resolution, how does this impact WPP media and evolve their proposition within the ecosystem?

46:49 Yeah, thanks for the question. It's a technical one, which I won't attempt to answer in huge amounts of detail, but the Apple browser now blocks third-party identity resolution and identity matching providers, and What I will say is it doesn't really impact our data solution at all because we don't rely solely on identity matching, right? As you know, we bought InfoSum roughly two years ago. We've now fully integrated it into our WPP open platform. It's a data collaboration platform that relies on a mix of data sources from consumer identity to our own WPP proprietary data to live signals from our ecosystem of data partners, nearly 400 of them.

47:35 And we use all of this data to identify untapped growth audiences and predict consumer behavior and ultimately deliver growth outcomes for our clients. So I would say in the scheme of things, the impact on WPP to these FIOS changes are minimal.

47:53 Okay, final question, probably for Joanne, and it partly touches on the answer you gave to Nico's question, but it's around WPP creative, it's around what are the specific factors, and in particular, whether there's any change in behavior from a client perspective that is driving the sort of delta of performance of WPP creative in the third quarter.

48:20 I mean in short no I think we have a very strong creative proposition at WPP and I would say some of the best talent in the industry um very encouraged by their win rate this year and we're continuing to ramp those up and increasingly we're seeing opportunities to sell creative as part of a much broader integrated proposition with media production commerce etc and I think that will be an opportunity for us way forward as I said you know this has been a big lift here for the WTP creative team as I've put them to their, you know, their new operating model. Most of that hard work is done now and then we'll be back to being 150% focused on that top line.

49:01 Perfect. And so with that, we've reached the end of the Q&A session. I'll now pass back to Cindy for some concluding remarks.

49:08 Thank you, Tom. Thank you, operator. And thank you all so much for your questions. Before we end the call, I wanted to just give you a quick sense of what's next. Because as we talked about, At our interim results, we continue to host events that spotlight what's kind of going on behind the scenes with our key operating units. We hosted sessions with WPP Media and WPP Creative in June and with production in September. I hope you got a chance to see those, and if you didn't, replays are available on the investor section of our website. To round off these webinars, we'll be hosting another one on WPP Enterprise Solutions in early December, and my team will be in touch in due course with the details. Thereafter, we anticipate reporting full-year results in late February, and at that point, we'll give a further detailed update on our strategic progress.

49:57 But for now, I just wanted to reinforce the message that we remain relentlessly focused on execution. While like-for-like revenue recovery does take time, we're encouraged by the progress, and we very much look forward to sharing more details with you in due course. In the meantime, I just want to say thank you again for your interest, for your engagement. and the IR team here are available if there's anything further we can do for you. But for now, thank you so much. Have a great day and bye for now. Thank you. That now concludes this call. You may now disconnect.