(Reuters) – Martin Sorrell’s S4 Capital cut its annual revenue growth and core profit margin forecasts on Monday, as the ad group’s technology sector clients grew more cautious amid challenging macroeconomic conditions.
Higher interest rates, sticky inflation, slower economic growth and geopolitical uncertainty have forced companies to cut costs.
S4, founded by ad boss Sorrell after he left WPP, said it now expects full-year like-for-like net revenue growth of 2%-4%, compared with an earlier forecast of 6%-10%.
It expects an operational core profit margin of 14.5%-15.5%, down from 15%-16% forecast previously.
“Reflecting the market backdrop, the company continues to maintain a disciplined approach to cost management, including headcount and discretionary costs,” S4 said in a statement.
“We expect these actions to support the outturn in the second half.”
(Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Savio D’Souza and Dhanya Ann Thoppil)
