As rivals cut thousands, Stagwell hires top talent and doubles down on AI, says CEO Mark Penn
“This is an incredible time of opportunity for Stagwell,” Chairman Mark Penn said. “In an industry of behemoths having trouble with their scale, we are just the right size to adapt to the coming revolution of AI.”
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At a time when legacy advertising giants are scaling back, Stagwell Inc. is hiring top-tier talent, accelerating AI integration and projecting revenue growth in the second half of the year. In its Q2 2025 earnings call, Stagwell executives painted a picture of a nimble and ambitious company leveraging the turbulence in the broader marketing services industry to gain ground.
“While most of the others are struggling with new business, our pipeline is robust and growing,” said Chairman and CEO Mark Penn, during an earnings call. “While others are cutting thousands of workers, we are picking up key talent from holdcos including 10 major new executives for our media businesses with vast big client experience.”
Among those hires is Slavi Samardzija, who will join Stagwell this fall from Omnicom’s Annalect to lead the firm’s data strategy. He joins a growing cadre of high-profile recruits from the likes of IBM, Microsoft, and Accenture.
The company also emphasized a striking turnaround in cash flow, with a $122 million improvement in operating cash for the first half of the year. “This is the new normal for Stagwell,” said Ryan Greene, the newly appointed Chief Financial Officer, who described the gains as sustainable and the result of a “holistic approach” to working capital and back-office efficiency.
Betting big on AI, with real deployment
While many agencies are still experimenting with artificial intelligence, Stagwell has already deployed AI tools across several functions. “We're investing about $20 million a quarter of OpEx and adapting to new technologies,” said Penn. “Discipline by discipline, we're adopting AI, applying it to tasks that can be streamlined or reimagined.”
In media, that includes automated agents for ad targeting; in communications, bots that write and pitch press releases; and in research, dashboards that respond to simple prompts with robust data analysis. Creative agencies under the Stagwell umbrella are also using generative AI to produce ads enhanced by complex visual effects.
The company’s proprietary platform, “the machine,” is set to be rolled out across the network by early 2026. Connected with Adobe systems, the platform aims to unify tools, teams, and data, promising up to 15% cost savings.
Client growth and sector strength
Much of Stagwell’s optimism is rooted in its expanding relationships with large clients. Its top 25 clients accounted for $175 million in Q2 net revenue, a 26% year-over-year increase. With new assignments from GM, Visa, Adobe and Target, organic growth is expected to accelerate in the second half, especially as client churn historically declines.
Stagwell’s Code and Theory Network, now positioned as a digital innovation partner of choice, saw 12% ex-advocacy growth, with tech-sector clients growing 11% year-over-year. “We are a tech company’s tech company,” Penn said.
Marketing Cloud, now rebranded simply as “Marketing Cloud,” posted 38% ex-advocacy growth. Notably, its Harris Quest research platform grew 100% organically.
Government work and global reach
The company is also venturing into new territory: government contracts. Stagwell recently won its first assignment in this space and is a finalist in several others.
“We're the number two listed U.S. marketing company,” Penn said. “My experience when I was at WPP was that 10% or 15% of our business should be really government contracts.”
These contracts offer multiyear stability and scale, Penn added, even if they require more compliance and paperwork.
Internationally, Stagwell completed the acquisition of ADK Global, expanding its footprint into 10 new Asia-Pacific markets. While cost synergies are limited, Penn said the real value lies in unlocking regional and global assignments. “We’re getting bids now on contracts that simply we would never have been considered for,” he said.
As many legacy holding companies face structural and operational pressures, Stagwell continues to position itself as a disruptive, tech-forward player, lean enough to adapt, but large enough to compete globally.
“This is an incredible time of opportunity for Stagwell,” Penn said. “In an industry of behemoths having trouble with their scale, we are just the right size to adapt to the coming revolution of AI.”
