Share your thoughts on our News & Insights section. Complete our survey to help us improve.

Share research

ITV: weak advertising outlook puts investors on edge

ITV Studios looks set for a strong recovery, but advertisers have been reluctant to splash the cash.
ITV - higher investment eats into profits, ITVX launch goes well

No recommendation - No news or research item is a personal recommendation to deal. All investments can fall as well as rise in value so you could get back less than you invest.

Prices delayed by at least 15 minutes

ITV’s revenue fell 8% in the first nine months of the year to £2.7bn, driven by a 20% decline at ITV Studios. Here the lingering impact of last year’s US writers’ and actors’ strike weighed on revenues in the third quarter.

A busy content slate in the fourth quarter is expected to limit the full-year revenue decline in Studios to a mid-single digit range. This uplift in content as well as cost cuts, means Studios is “on track” to deliver record underlying cash profit (EBITA) over the full year.

Media and Entertainment revenue was up 4%, with Total Advertising Revenue (TAR) growth of 6% being helped by strong progress in digital as streaming hours were up 14%. As expected however, things slowed over the third quarter, where TAR was flat.

ITV said the absence of the Rugby World Cup and weak bookings ahead of the UK budget held back fourth quarter activity. As such full-year TAR is expected to grow by just 2.5%.

The shares fell 7.9% early trading.

Our view

HL view to follow.

ITV key facts

All ratios are sourced from Refinitiv, based on previous day’s closing values. Please remember yields are variable and not a reliable indicator of future income. Keep in mind key figures shouldn’t be looked at on their own – it’s important to understand the big picture.

This article is original Hargreaves Lansdown content, published by Hargreaves Lansdown. It was correct as at the date of publication, and our views may have changed since then. Unless otherwise stated estimates, including prospective yields, are a consensus of analyst forecasts provided by Refinitiv. These estimates are not a reliable indicator of future performance. Yields are variable and not guaranteed. Investments rise and fall in value so investors could make a loss.

This article is not advice or a recommendation to buy, sell or hold any investment.No view is given on the present or future value or price of any investment, and investors should form their own view on any proposed investment.This article has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is considered a marketing communication.Non - independent research is not subject to FCA rules prohibiting dealing ahead of research, however HL has put controls in place(including dealing restrictions, physical and information barriers) to manage potential conflicts of interest presented by such dealing.Please see our full non - independent research disclosure for more information.
Latest from Share research
Weekly Newsletter
Sign up for Share Insight. Get our Share research team’s key takeaways from the week’s news and articles direct to your inbox every Friday.
Written by
Aarin Chiekrie
Aarin Chiekrie
Equity Analyst

Aarin is a member of the Equity Research team. Alongside our other analysts, he provides regular research and analysis on individual companies and wider sectors. Having a keen interest in global economics, he knows how macro-events can impact individual companies.

Our content review process
The aim of Hargreaves Lansdown's financial content review process is to ensure accuracy, clarity, and comprehensiveness of all published materials
Article history
Published: 7th November 2024