Broadcaster ITV has revealed a 10% drop in advertising revenues at the start of 2023 and warned trading will get tougher in the second quarter as firms rein in marketing spend against a difficult economic backdrop.
The group behind hit shows Love Island and I’m A Celebrity… Get Me Out Of Here! cautioned over a “challenging” outlook for ad spending and predicted a 12% fall over the three months to the end of June, with declines accelerating to around 14% next month.
But chief executive Carolyn McCall insisted its first quarter fall was better than the wider market and said the group pulled in large streaming audiences for exclusive series such as Nolly and The Twelve on its ITVX online content platform.
ITV added that live “simulcast” viewing of its biggest shows and sports events – including Love Island and the FA Cup – also proved popular with streaming audiences.
“We are looking forward to the third quarter with Love Island and the Rugby World Cup set to draw large broadcast and streaming audiences.”
The group said it is seeing strong growth in digital advertising revenues in its media and entertainment business – up 30% at £87 million in the first three months of 2023 and expected to rise by more than 20% in the second quarter.
But this is not yet enough to offset the the wider slump in ad spend.
It said ITVX had “sustained its strong launch” with a 49% increase in streaming hours and a 29% rise in digital revenues over the quarter.
The update showed overall total external revenues fell 7% to £776 million in the first three months of 2023.
“ITV is successfully executing phase two of its More Than TV strategy, despite the current challenging macro and geopolitical environment, as we continue to satisfy the growing demand for content globally and the desire for advertisers to secure both mass reach and targeted digital audiences,” said Ms McCall.