Ad Agencies Might Be More Resilient to AI Threat Than Market Fears -- Market Talk

Dow Jones06-03

0935 GMT - Advertising stocks have been gripped by AI-related concerns since 2023, but the investor debate is shifting and the industry might be better equipped to deal with the risk than some fear, Goldman Sachs's Adam Berlin and James Tate say in a research note. "The key question is whether the barriers to entry--including scale, operational complexity, and data advantages--that have supported the sector's oligopolistic structure are weakening. We see limited evidence thus far," the analysts say. A flattish performance for the sector overall last year intensified investor scrutiny, but it could return to top-line growth of 2%-3% in the fourth quarter, they add. Goldman Sachs starts coverage of Publicis and Omnicom with buy recommendations, and of WPP with sell. Publicis rises 0.2% and WPP falls 2.2%. Omnicom is up 1.4% in U.S. premarket trading. (adria.calatayud@wsj.com)

(END) Dow Jones Newswires

June 03, 2026 05:38 ET (09:38 GMT)

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