This week’s headlines track the accelerating convergence of AI innovation and media growth. In today’s MadTech Daily, we cover Bending Spoons acquiring AOL for $1.5bn, WPP’s new CEO issuing a profit warning, and Meta’s ad revenue jumping 26% in Q3.

Festive forecasts are looking bright for the UK ad market. According to the latest Advertising Association/WARC Expenditure Report, ad spend is set to surge 7.3% year-on-year to £12bn in Q4 2025, a robust £814m increase on last year’s total. Video-on-demand is driving much of this growth, helping lift full-year ad spend to £46bn, with a further 6.6% boost expected in 2026.

In the AI landscape, OpenAI has hit a USD$500bn (£370bn) valuation following its restructuring into a public benefit corporation, with Microsoft retaining a 27% stake worth roughly USD$135bn (£99.9bn). At the same time, OpenAI is embedding PayPal’s services into ChatGPT, announcing plans to integrate wallet payments directly into the platform by 2026 via the Agentic Commerce Protocol and new Instant Checkout feature.

Elon Musk unveiled Grokipedia, an AI-powered encyclopedia designed as a rival to Wikipedia. Musk claims the project will counter “ideological bias” and “purge propaganda,” a familiar refrain that underscores his push to reshape online information ecosystems through his xAI venture.

Meanwhile, turmoil continues at X as John Nitti, global head of revenue operations and ad innovation, exited after just ten months. It’s another high-profile departure that deepens uncertainty around the platform’s ad business.

Elsewhere, The Observer struck a deal with Particle, an AI-driven news aggregation platform that will summarise and feature its reporting. The partnership aims to extend The Observer’s digital reach while tapping into the growing trend of AI-powered news discovery.