(Bloomberg) -- Advertising giant WPP Plc said sales in the US continued to slow last quarter, as the British group is restructuring its agencies to cut costs in the face of sluggish ad spending.

Revenue declined 4.5% in the US in the fourth quarter, primarily due to lower spending by technology, healthcare and retail clients, WPP said in a statement on Thursday. The group saw strong growth in the UK and India, partially offset by declines in Germany and China. 

Revenue less pass-through costs was £11.9 billion ($15 billion) in 2023, in line with estimates. 

WPP expects luxury brands to spend more cautiously on ads this year, Chief Executive Officer Mark Read said in a phone interview with Bloomberg. The forecast is “mixed” in the automotive sector and positive in the consumer goods sector as clients pursue a value strategy, Read added. 

This year, revenue, less pass-through costs, will be flat or grow as much as 1% from a year earlier, the London-based company said at its capital markets day last month. In comparison, rival Publicis Groupe SA is expecting its organic sales to grow 4% to 5% this year.

Facing sluggish sales growth due to the global slowdown and a decrease in spendings in the tech space, WPP has seen its share price falter over the last year. The London-based group has been restructuring its stable of advertising brands to save costs, and is betting on AI to boost its performance.

WPP shared plans last month to spend about £250 million a year to invest in new technologies to support its artificial intelligence strategy, after Publicis made a similar announcement.

(Add comments from CEO)

©2024 Bloomberg L.P.