TV advertising revenues in Q3 far exceeded pre-pandemic levels, according to European broadcasting giants RTL Group and ProSiebenSat.1, which both reported their Q3 financial results today.
ProSieben said that advertising revenues in its ‘Entertainment’ segment, which is made up of its TV and digital ad sales, were up 18 percent year-on-year. This brought ad revenues in German-speaking markets now above pre-pandemic levels.
Prosieben’s TV ad revenues in Germany specifically reached €1.65 billion. This represents 24.5 percent growth over last-year’s pandemic hit quarter. But it also marks 17 percent growth on Q3 2019.
RTL has similarly seen remarkable growth in TV ad revenues, even compared with pre-pandemic years. RTL’s total TV ad revenues were up 16 percent compared with Q3 last year, and 15 percent compared with Q3 2019.
What’s not yet clear is whether this growth is sustainable long-term. Prior to the pandemic, TV ad revenues were under threat, and TV ad revenue growth was no guarantee for European broadcasters in the quarterly earnings. So the fact that two European powerhouses have not only recovered from the pandemic, but shown significant growth on pre-pandemic levels, could be seen as a positive sign for TV advertising.
ProSieben cited Nielsen Media Research, which found that 45.9 percent of German ad spending went to TV, compared to 42.4 percent last year, a promising uptick for the TV ad market. Rainer Beaujean, ProSieben’s chairman suggested this is the case, saying strong TV ad revenues “underlines the strength and sustainability of our medium”.
But the growth may equally be something of an anomaly, as brands invest in trusted ad media to fuel their own recoveries from the pandemic.
Hedging bets
Both broadcasters said that TV revenues are also benefitting from investments made in advanced and addressable TV advertising, which are drawing in more ad spend.
But while the TV ad market looks strong at the moment, executives from both companies were also keen to highlight the strength of their non-advertising revenues as well.
RTL Group’s Thomas Rabe focused on streaming revenues, which were up 30.6 percent for the first nine months of this year. Total subscriber count meanwhile was up by over 90 percent year-on-year.
RTL has now significantly increased its targets for its streaming business. Previously the company had targeted streaming revenues of €500 million by the end of 2025. Now it’s hoping to reach €1 billion by the end of 2026.
ProSieben’s Beaujean meanwhile highlighted growth in programme production and sales revenues, which were up 20 percent year-on-year, and in its dating segment, which saw revenue growth of over 50 percent.
Both broadcaster will be happy to ride the wave of TV ad revenue growth while it lasts, but neither will bet their entire future on this growth being sustainable.
