Rolls-Royce can energy Britain’s AI revolution – authorities and traders should help it, says ALEX BRUMMER

Not much, one might think, connects three very different British companies – Rolls-Royce, the London Stock Exchange Group (LSEG) and WPP – all of which have just reported annual results.

Rolls, under the transformative leadership of Tufan Erginbilgic, has demonstrated anything is possible. 

It has gone from being at existential risk in the pandemic to an engineer firing on all cylinders.

The prospects are remarkable and there has been a dazzling share price performance which has taken it from also-ran to the top five in the FTSE 100, with a market value of £116billion.

The remarkable rise shows that with the right management anything is possible. The recovery in the aerospace market and flying hours is at the core of what the company does.

But Rolls is also a world leader in the turbines and engines which drive a whole range of technologies such as AI data centres, nuclear subs, the Typhoon fighter jet and small modular reactors.

Powering ahead: Under the transformative leadership of chief exec Tufan Erginbilgic Rolls-Royce has gone from being at existential risk to an engineer firing on all cylinders

Erginbilgic embraced transformation and focused on strengthening margins. Consequently, the Rolls turnaround is not only about aero engines and the prospective move into narrow-bodied jets.

The global drive into artificial intelligence and the cloud is propelling Rolls forward. 

Moreover, the group is so confident about the future that, along with the latest uplift in sales, earnings, and cash-flow forecasts, there is an epoch-making £9billion share buyback pledge over the next three years.

It is the embrace of AI which links Rolls to the LSEG and WPP. Activist investor Elliott is smart at spotting under-valuations and has wrapped its tentacles around LSEG.

The shares have had a torrid time and been damaged by bulletins from Anthropic claiming an AI game-changer. This has unsettled big data companies.

LSEG chief executive David Schwimmer insists that it was ‘unlikely, verging on impossible’ that his group’s data could be replaced or replicated by AI.

Schwimmer has signed partnership deals with both Anthropic and OpenAI on data access, but the proprietary information remains with the UK markets group.

It, too, is seeking to get investors – including Elliott – back on-side, with a £3billion share buyback, which is a vote of confidence in the future.

The arrival of Cindy Rose at sinking WPP is all about jumping ahead of rivals by embracing tech. There are two key aspects to the group’s strategic review.

It is ending the internal competitive structure inside the ad agency by bringing its creative teams together under one roof.

More fascinating is the effort to leap ahead of rivals like Publicis through WPP Open, which embraces AI with the aim of bringing an integrated data, creative and production approach to commercials.

Investors are being asked to be very patient, with 2026 likely to be a troubling year. Nevertheless, the sight of chairman Philip Jansen and Rose backing a better future by buying equity must be a plus.

Top executives at LSEG and WPP may find it tough to drive the kind of internal revolution seen at Rolls-Royce.

But it is paramount that exemplars of Britain’s strength in engineering, finance and creativity are supported by investors and government in the greater national interest.

Davos descent

The elitism of the organisers of the World Economic Forum in Davos is legion.

The inflated prices which business executives and financiers pay to be at the top table are legendary.

A hierarchical and mercurial badging system bars some delegates and media figures from key events.

Moreover, the inability of delegates to spot a crisis, even when in the middle of one, is part of its history.

How shameful it is to discover that the key figures are less than scrupulous in their behaviour.

The president and chief executive, Borge Brende, yesterday resigned after disclosure of emails showing a warm connection to convicted paedophile Jeffrey Epstein.

Founder Klaus Schwab stepped back last year after whistleblower allegations of financial and ethical misconduct.

Back to earth for the leaders who scaled the summit!