AIBRIEF
The Japanese ad group said Friday it will trim its sprawling foreign business by FY2028, a move the Nikkei links to competition from AI armed consultancies and tech firms.
Dentsu Group will cut up to 30% of its overseas subsidiaries by fiscal 2028, the Japanese advertising group said Friday, a move that comes as consulting and tech firms armed with artificial intelligence have moved into territory once dominated by traditional agencies.
The cuts target up to 160 overseas entities and run alongside a separate 30% reduction in global headquarters costs, also by FY2028, according to exchange4media. The Nikkei, which first reported the plan, said the move responds to "consulting and tech firms armed with artificial intelligence." That category now includes the platforms and systems integrators that have been eating into agency pitches for planning, media buying, and creative production.
Dentsu returned to profit in the first half of 2026 after a loss a year earlier. The swing is not a clean signal that the restructuring is working. The interim profit was propped by the sale of Dentsu's Ginza headquarters and a weak yen, per Biggo finance, while MediaPost put organic growth at just 0.3% for the period. The cuts are a bet that consolidation buys time against AI-native rivals. Whether the bet works is the open question.