WPP (WPP) Gross Margin % : 19.08% (As of Dec. 2023)

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WPP Gross Margin % Definition

Gross Margin % is calculated as gross profit divided by its revenue. WPP's Gross Profit for the six months ended in Dec. 2023 was $1,842 Mil. WPP's Revenue for the six months ended in Dec. 2023 was $9,650 Mil. Therefore, WPP's Gross Margin % for the quarter that ended in Dec. 2023 was 19.08%.

Warning Sign:

WPP PLC gross margin has been in long-term decline. The average rate of decline per year is -1.9%.

The historical rank and industry rank for WPP's Gross Margin % or its related term are showing as below:

WPP' s Gross Margin % Range Over the Past 10 Years
Min: 16.79 Med: 18.64 Max: 87.3
Current: 16.97

During the past 13 years, the highest Gross Margin % of WPP was 87.30%. The lowest was 16.79%. And the median was 18.64%.

WPP's Gross Margin % is ranked worse than
83.51% of 964 companies
in the Media - Diversified industry
Industry Median: 38.675 vs WPP: 16.97

WPP had a gross margin of 19.08% for the quarter that ended in Dec. 2023 => No sustainable competitive advantage

The 5-Year average Growth Rate of Gross Margin for WPP was -1.90% per year.

WPP Gross Margin % Historical Data

The historical data trend for WPP's Gross Margin % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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WPP Gross Margin % Chart

WPP Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Gross Margin %

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18.20

16.79

17.21

17.59

16.97

WPP Semi-Annual Data
	Jun14	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
Gross Margin %	Get a 7-Day Free Trial															19.00	15.50	19.44	14.74	19.08

Competitive Comparison of WPP's Gross Margin %

For the Advertising Agencies subindustry, WPP's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

WPP Gross Margin % Distribution

For the Media - Diversified industry and Communication Services sector, WPP's Gross Margin % distribution charts can be found below:

* The bar in red indicates where WPP's Gross Margin % falls into.

WPP Gross Margin % Calculation

Gross Margin is the percentage of Gross Profit out of sales or Revenue.

WPP's Gross Margin for the fiscal year that ended in Dec. 2023 is calculated as

Gross Margin % (A: Dec. 2023 )	=	Gross Profit (A: Dec. 2023 )	/	Revenue (A: Dec. 2023 )
	=	3188.6	/	18790.886
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(18790.886 - 15602.278)	/	18790.886
	=	16.97 %

WPP's Gross Margin for the quarter that ended in Dec. 2023 is calculated as

Gross Margin % (Q: Dec. 2023 )	=	Gross Profit (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	1841.5	/	9650.127
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(9650.127 - 7808.608)	/	9650.127
	=	19.08 %

A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.

WPP (NYSE:WPP) Gross Margin % Explanation

Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.

Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %

1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key

WPP had a gross margin of 19.08% for the quarter that ended in Dec. 2023 => No sustainable competitive advantage

Be Aware

If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.

WPP Gross Margin % Related Terms

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WPP (WPP) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Communication Services » Media - Diversified » WPP PLC (NYSE:WPP) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

WPPGF:USA WPPl:UK WPP:UK 0WP:Germany 0WP:Germany

Address

18 Upper Ground, Sea Containers, London, GBR, SE1 9GL

Website

https://www.wpp.com

Headquartered in the United Kingdom, WPP is the world's largest ad holding company, based on annual revenues. WPP's services, which include traditional and digital advertising, public relations, and consulting, are provided worldwide, with over 70% of its revenue coming from more developed regions such as North America, the U.K., and Western Europe.