WPP PLC, the world’s largest advertising group, has lowered its full-year outlook after not doing as well as expected from the Olympics, the U.S. presidential campaign and the European soccer championships.
Shares opened 5 percent lower at 768.3 pence in London as the company said Thursday that it expected revenue growth between 2.5 percent and 3 percent for the year, down from the 3.5 percent target it set in August.
Third quarter revenue was up 1.6 percent to 2.5 billion pounds ($4 billion). The company did not disclose profit figures in the trading update.
“In some ways, the company is a proxy for the global economy and, even into 2013 WPP is managing down expectations,” said Richard Hunter, head of securities at Hargreaves Lansdown Stockbrokers.
“The reaction of the share price in early trade is testament to a market which is searching for corporate good news stories, but is finding them hard to locate,” Hunter said.
WPP said the three big events did support growth but not as much as expected, with money often switched from existing budgets, “particularly in the cases of the UEFA Championships and Olympics.”
Revenue fell by 0.4 percent in North America and 2.1 percent in western continental Europe, WPP said. Latin America was the best-performing region with growth of nearly 15 percent.
WPP said that in the U.S. it was worried about the government’s handling of debt and the looming “fiscal cliff” of expiring tax and spending legislation, which could result in automatic tax increases at the end of the year if politicians do not agree on new budget terms.
“Fears remain that whoever wins the presidential election, will be unable to deal with these issues given a dead-locked Congress,” the company said.
Apple and Google Face UK Investigation Into Mobile Browser Dominance
Apple and Google aren't giving consumers a genuine choice of mobile web browsers, a British watchdog said Friday in a report that recommends they face an investigation under new U.K. digital rules taking effect next year.
The Competition and Markets Authority took aim at Apple, saying the iPhone maker's tactics hold back innovation by stopping rivals from giving users new features like faster webpage loading. Apple does this by restricting progressive web apps, which don't need to be downloaded from an app store and aren't subject to app store commissions, the report said.
"This technology is not able to fully take off on iOS devices," the watchdog said in a provisional report on its investigation into mobile browsers that it opened after an initial study concluded that Apple and Google effectively have a chokehold on "mobile ecosystems."
The CMA's report also found that Apple and Google manipulate the choices given to mobile phone users to make their own browsers "the clearest or easiest option."
And it said that the a revenue-sharing deal between the two U.S. Big Tech companies "significantly reduces their financial incentives" to compete in mobile browsers on Apple's iOS operating system for iPhones.
Both companies said they will "engage constructively" with the CMA.
Apple said it disagreed with the findings and said it was concerned that the recommendations would undermine user privacy and security.
Google said the openness of its Android mobile operating system "has helped to expand choice, reduce prices and democratize access to smartphones and apps" and that it's "committed to open platforms that empower consumers."
It's the latest move by regulators on both sides of the Atlantic to crack down on the... Read More