Dentsu Japan props up group, job cuts to come after big APAC revenue declines
Dentsu’s Japanese business achieved record-high net revenue in Q2 2025, however other markets have faced considerable declines, including APAC which suffered a 12.7% drop in organic revenue.
The group’s leadership took responsibility for the dire international result and is preparing a wave of cost-cutting, with plans to slash 3400 jobs, or 8% of the non-Japan workforce.
Australia — where CEO Patricio de Matteis has been pushed out in favour of NZ boss Rob Harvey — was named and shamed as one of the worst performers with “less than -10%” organic growth.
Overall, the holdco experienced a 0.7% decline in organic growth for Q2. Net revenue was at AU$2.86 billion (¥274.7 billion) for the quarter, down 4.4% year-on-year.
Japan was the clear top performer, delivering 5.1% organic revenue growth in Q2 with net revenue of AU$1.12 billion (¥107.0 billion). The Americas dropped 1.6% to AU$815 million (¥77.6 billion) while EMEA had a decline of 3.8% to $AU674 million (¥64.3 billion).
APAC, excluding Japan, performed the worst with negative 12.7% in organic revenue. Net revenue for the region was at AU$251 million (¥24.1 billion). APAC’s poor performance largely stemmed from issues in customer experience management and creative services, according to the group.
Hiroshi Igarashi
President and global CEO, Hiroshi Igarashi, said: “CXM business is recovering more slowly than previously anticipated with continued challenging business environment, and the creative business continues to face a tough performance due to losses in some ongoing projects, mainly caused by shifts in the client’s marketing approach.”
Australia and China were among the countries in the region hit the hardest (both over 10% in decline), while Taiwan and Thailand delivered slightly more, with organic growth sitting between “0%-5%”.
Dentsu said it would accelerate its efforts to rebuild its business foundation and review underperforming segments to “achieve a faster recovery” in profitability, particularly in the APAC region.
“As part of the reevaluation of underperforming businesses, we have completed the identification of underperforming markets and entities and have begun taking the appropriate countermeasures,” Igarashi said.
“I am acutely aware that reforming the international business is an urgent issue … I deeply regret this situation and offer my sincere apologies on behalf of the company.”
Elsewhere, Publicis Groupe continues to be the star performer, with 5.9% organic growth credited to an “unprecedented new business run” in the first six months of the year, including Coca-Cola, Nespresso, Lego, Paramount, and Spotify. In total, the group secured AU$8 billion (€4.46 billion) in new business in H1.
Omnicom reported a 3% organic revenue growth in Q2. Broken down by discipline, year-on-year growth was 8.2% for media and advertising; 5% for precision marketing; 2.9% for experiential; and 1.5% for execution and support. This growth was partially offset by declines of 9.3% for public relations, 4.9% for healthcare, and 16.9% for branding and retail commerce.
Havas had “another quarter of growth acceleration”, with 2.6% organic growth and net revenue reaching AU$1.24 billion (€697 million) in Q2. Broken down, 36% of that came from Havas Media, 41% from Havas Creative, and 23% from Havas Health. The French holdco also struggled significantly in APAC.
Meanwhile, IPG reported a 3.5% drop, which CEO Philippe Krakowsky said was “in line with expectations”. The decline was atrributed to “prior-year client account activity”. IPG reported AU$3.87 billion (US$2.54 billion) in total revenue for Q2, down from AU$4.14 billion (US$2.71 billion) in the same period last year.
WPP had the worst Q2 performance, with a 5.8% decline in revenue less pass-through costs (RLPTC) to AU$5.24 billion (£2.54 billion). RLPTC is the WPP metric that comes closest to other holdcos’ organic revenue. Outgoing CEO Mark Read said Q2’s slump was due to “pressures on client spending and a slower new business environment”. WPP has therefore had to slash staff bonuses, shed thousands of staff, halve dividends, and has said incoming CEO Cindy Rose will review its strategy.
Related Content
SUBSCRIBE
Sign up to our free daily update to get the latest in media and marketing.
Why are we hearing nothing from local leadership on any of this? Surely they have something to say publicly to reassure clients, staff and other stakeholders?