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Dentsu CEO pledges overhaul of struggling overseas business; reports 3,400 job cuts
Dentsu will cut 3,400 overseas jobs and pursue sweeping restructuring after steep losses and a weaker outlook for its international business.
Dentsu Group’s chief executive said Thursday the company will cut about 3,400 jobs in its international business and accelerate restructuring efforts after a sharp deterioration in overseas performance and a steep downward revision of its full-year outlook.
“In the first half of the fiscal year, our Japan business achieved record-high net revenue and underlying operating profit,” said Hiroshi Igarashi, president and global chief executive of Dentsu. “It also grew for the ninth consecutive quarter and achieved an organic growth of over 5% for the third consecutive quarter. In contrast, the international business continued to experience negative growth in all three regions, resulting in an extremely challenging performance.”
The job cuts, equivalent to about 8 percent of Dentsu’s overseas workforce, are part of a plan to achieve annual operating cost reductions of approximately ¥52 billion ($355 million) by fiscal 2027. “We have already identified all necessary measures, including the headcount reduction of approximately 8% (approximately 3,400 people) in the international business,” Igarashi said.
Dentsu also booked ¥86 billion in goodwill impairment losses in the Americas and EMEA, reflecting a weaker forecast for its international operations and changes to long-term growth assumptions. The company now expects an operating loss of ¥3.5 billion and a net loss of ¥75.4 billion for fiscal 2025, and has suspended its interim dividend.
“I am acutely aware that reforming the international business is an urgent issue,” Igarashi said. “In our international business, we will focus on fundamental improvement measures to restore its profitability and competitive advantage while striving to enhance the corporate value of the entire group, growing as One dentsu.”
While overseas markets remain under pressure, Igarashi said the Japan business is expected to maintain growth in the second half, supported by new client wins and industry recognition, including 26 awards at the Cannes Lions International Festival of Creativity. “We will overcome this challenging situation, solve issues together with our clients and partners, and grow alongside them,” he said.
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