ITV’s Ad Revenues Fall by Ten Percent

Tim Cross 11 May, 2023 

UK broadcaster ITV posted its Q1 trading update, showing that it – like pretty much all other European TV broadcasters – has been hit hard by a tough TV advertising market. Following a one percent drop in total advertising revenues for the company last year, ad revenues were down ten percent year-on-year for the first quarter.

The fall wasn’t unexpected. ITV had warned in its full year results for 2022 that macroeconomic conditions would lead to a tough start to the year. The company has actually forecasted an 11 percent drop in ad revenues, meaning the drop was slightly lower than had been expected.

This looks to be due in large part to better than expected growth in digital ad revenues. Digital has been a major focus for ITV over the past few quarters, with the launch of its revamped streaming service ITVX, and a new commissioning and scheduling strategy which has seen the broadcaster release more content specifically via its streaming app. Digital ad revenues were up 30 percent year-on-year, surpassing the 25 percent growth which ITV had predicted.

And ITV believes this digital growth will continue, as viewing via ITVX continues to grow (total streaming hours were up 49 percent year-on-year in Q1), and as advertisers funnel more spend through Planet V, ITV’s programmatic buying platform.

But while this growth is fast, it’s not fast enough to offset the declines of traditional linear TV ad revenues. In Q2, ITV forecasts another drop in ad revenues, with total advertising revenues expected to be down by 12 percent year-on-year.

Looking further ahead, ITV says it’s on track for total digital revenues (which includes subscription revenues and digital partnership revenues, alongside digital ad revenues) to reach £750 million by 2026. This would be substantial growth; total digital revenues hit £411 million last year. But total media and entertainment revenues were £2.25 billion last year, £1.93 billion of which came from advertising. Currently digital ad revenues make up around 80 percent of ITV’s total digital revenues – if this stay consistent, ITV would be looking at around £620 million in digital ad revenues by 2026. This is a significant sum, but it will still be just a fraction of total ad revenues – and perhaps not enough to counteract continued downswings in traditional TV ad spend.

Better things ahead?

While drops in ad revenue are not new, revenues from ITV’s production division ITV Studios have been a consistent growth point in recent years.

However even studio revenues were flat at £457 million, despite a positive foreign exchange effect. Thus overall, ITV’s total group external revenue was down seven percent over the quarter.

ITV said that studio revenues should pick up later in the year, with the phasing of deliveries for 2023 expected to be weighted towards the second half of the year.

And indeed overall, ITV is hoping that while Q2 is likely to also be tough, there will be something of a turnaround in the second half of the year. On the advertising front, the broadcaster mentioned the Rugby World Cup and the return of its popular reality show Love Island as two tent poles which should attract large audiences, and therefore ad revenues.

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About the Author:

Tim Cross is Assistant Editor at VideoWeek. slot gacor 4d slot gacor togel pulsa slot88 akun pro thailand slot gacor 4d slot gacor slot gacor 4d toto slot situs toto slot5000 situs togel slot88 slot dana slot demo slot gacor situs togel situs togel slot gacor slot777 situs togel situs togel toto slot slot demo judi bola slot77 slot bonus slot deposit pulsa slot88 bandar togel slot gacor 4d slot gacor 88 toto togel situs togel bandar togel bandar togel slot gacor slot88 slot server thailand slot88 slot88 slot gacor slot gacor slot gacor slot88 bandar togel togel macau slot4d
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