ITV Studios and ITVX revenues helped to offset falls in linear at UK network ITV in the first nine months of 2023.A Q3 trading update revealed ITV Studios turnover has grown 9% to $1.87B, while digital revenues — much of which are now derived from streamer ITVX — are up 23% to reach £340M.Key productions in the period have included Prime Video tennis drama Fifteen Love; Love Island USA season 5 for Peacock; and World on Fire season 2 for the BBC, while total streaming hours were up 27% year-on-year to the end of September — you can read more analysis about ITV’s pivot to streaming here.Those two figures meant ITV’s overall revenues remained almost exactly flat, up 1% at £2.98B. Total external revenue was a similar result, coming in at £2.53B. Revenue from the Media & Entertainment division that houses its networks was down 7%, as expected, at £1.46B.Advertising revenue was down 7%. Most major commercial broadcasters have been slammed by an ongoing advertising downturn, making growth elsewhere more important than ever.“It is evident that our strategy of growing the Studios and M&E digital business is helping ITV to offset the current headwinds and we remain confident in delivering our 2026 targets, when we expect two-thirds of revenue to come from these growth drivers,” said CEO Carolyn McCall. She added ITV Studios “grew faster than the market.”She added, “ITV continues to make good strategic progress despite the challenging macro environment which is impacting the advertising market and also the demand for content from free-to-air broadcasters in the UK and internationally.“ITVX had a successful nine months delivering 27% growth in total streaming hours which, in turn, helped deliver 23% growth in digital revenue. Growth in digital advertising revenues continues to outperform other broadcasters reflecting ITVX’s compelling viewer and advertising proposition.”McCall added ITV was “on track” to deliver £15M of cost savings this year, as part of a plan to save £50M between between this year and 2026. ITV will also “rephase” an additional £10M of content spend from 2023 into 2024, meaning it will spend around £1.29B this year, while the network noted impacts from the writers and actors strikes in the U.S. is expected to defer revenues from 2024 to 2025.No earnings figures were provided in the trading update but ITV said it was “committed to maintaining an adjusted EBITA margin for ITV Studios of 13% to 15% over the period to 2026.” Group adjusted EBITA for the first six months of 2023 was down 52% at £152M, as we reported in July.ITV added it welcomed the Media Bill’s inclusion in the King’s Speech yesterday. This confirmed streaming services will soon be regulated in the UK by watchdog Ofcom, and ensures public service broadcasters such as ITV will receive prominent positions on streaming platforms.There was no word on whether ITV has bid for All3Media. Last month, we revealed Banijay, The North Road Company and Goldman Sachs were the remaining bidders in the auction for the Traitors maker, with ITV watching closely from the sidelines.
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