House 337-owner Next 15 has reported a slight dip (-1%) in organic revenue in the Customer Engage part of the business which contains its principal advertising, PR and media agencies.
Half-year results for the six months to 31 July shows that businesses overall net revenue saw a subtle rise of 0.1%, from £286.4m to £286.8m. According to the business, this was driven by a “weakness in spend from technology customers” and from UK government departments owing to the snap election.
Meanwhile, the Customer Engage section, which includes MHP Group, Brandwidth, Elvis, House 337 and more, saw its net revenue increase by 2.5% to £134.4m.
It said that this was down to the segment’s “growing relationships” with clients including P&G, Google, Astra-Zeneca and Dow Chemicals.
Looking ahead, Next 15 said that it expected government spend to recover early in its 2026 financial year, “with the recent change in government alleviating political uncertainty in the UK”.
It blamed a fall in operating profit margin (which was down to 16.8% from 19.9% in the same period last year) on the “underperformance” of its higher margin businesses.
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It is also set to invest more into AI: “The primary focus of capital allocation is to continue to prioritise investment in internal capabilities. This includes Generative AI, which remains a key investment area for the Group and an area where we have made significant progress,” the group said.
“Our newly formed Next 15 AI Labs unit has already started to generate new ideas and opened client conversations which in turn are driving AI led product development within the portfolio companies.”
“We are now tracking more than 130 separate AI product and innovation projects across the Group”.
It described its overall performance as “mixed”. It cited the loss of a large contract with venture capital firm Mach 49, which had been expected to contribute £80m of revenue in FY26 and FY27.
“These results mask some strong performances by a number of the Group’s businesses which need to be recognised. Most notably, performances by Agent3, Brandwidth, M Booth, M Booth Health, MHP and SMG,” said Next 15 CEO Tim Dyson.
“They also mask strong progress on embedding AI into our systems and in the development of new customer-facing AI-based products and services. While trading conditions in tech continue to create headwinds for many businesses, especially in our Delivery and Engage segments, conditions in other sectors remain favourable,” he added.
