ITV Quarterly Revenues Down, Streaming Business Soars

U.K. broadcasting giant ITVs revenues dipped in the first quarter of 2023, but streamer ITVX has seen a growth uptick, according to figures released on Thursday.

The financial and operating performance for the three months to March 31 was as expected, ITV said, with total external revenue down 7% at 776 million ($979.4 million), compared to 834 million ($1.05 billion) over the same period in 2022.

Total ITV Studios revenue was flat at 457 million (2022: 458 million). Deliveries in the U.K. and internationally included Nolly for ITVX, Django for Sky, Big Beasts for AppleTV+ and Queer Eye for Netflix.

ITVs media and entertainment revenue was down 9% at 495 million (2022: 545 million), with total advertising revenue down 10%, which the broadcaster says is better than the wider TV advertising market. Within this digital advertising revenue was up 30% at 87 million compared to the same period in 2022.

Free ad-funded streamer ITVX was the strong performer with total digital revenues up 29% and total streaming hours up 49% in Q1.

The broadcaster said that it had maintained its strength in delivering mass reach with 93% of the top 1,000 commercially broadcast TV programmes and 34.4% share of commercial viewing on channels.

Looking forward, the company said that it expects ITV Studios to deliver at least 5% average organic revenue growth per annum to 2026, and that it is committed to delivering adjusted EBITA (Earnings before interest, taxes, and amortization) margin for ITV Studios of 13% to 15% over the period to 2026.

ITV projects a similar positive outlook in media and entertainment with revenues expected to be up over 20% but says that total advertising revenue will be down 12% in the second quarter.

The broadcaster talked up strengthening ITVX content with Malpractice and Crime and Love and Death. This, together with our deep relationships with advertisers and strong demand for digital advertising through [advertising platform] Planet V, continues to give us confidence that we will deliver at least 750 million of digital revenues by 2026, ITV said.

Carolyn McCall, ITV chief executive, said: ITV continued to make significant strategic progress in the quarter and all parts of the business performed in line with expectations. ITVX has sustained its strong launch, with a 49% increase in streaming hours and a 29% growth in digital revenue in the quarter. Exclusives, such as Nolly and The Twelve attracted new viewers, 80% of whom went on to explore other content on ITVX. In addition, live simulcast viewing of our biggest shows and sports events, including Love Island and the FA Cup attracted large streaming audiences.

ITV Studios continues to demonstrate significant strategic momentum. With a strong pipeline of content and committed revenues, it is on track to deliver mid-single digit revenue growth over the full year, ahead of the market. This follows record revenues in Q4 2022 and with the phasing of deliveries expected to be weighted to the second half of 2023.

Total advertising revenue in Q1 was down 10% as expected and better than the wider TV advertising market. We are looking forward to Q3 with Love Island and the Rugby World Cup set to draw large broadcast and streaming audiences.