Broadcasting giant ITV has revealed plans to cut spending on content this year as it warned that advertising revenues are set to fall by 8% in 2023.
The group behind hit TV shows such as I’m A Celebrity … Get Me Out Of Here! and Love Island said total advertising revenues fell 7% to £1.45 billion in the first nine months of 2023, despite edging up by 1% in the third quarter.
Total revenues lifted 1% to £2.98 billion in the period, however, as its studio and digital performance offset the drop in traditional TV ad demand.
ITV said a “challenging” economic backdrop will leave total ad revenues lower over the full year, with falls of 15% in November and between 10% and 15% in December compared with a year earlier, when demand was boosted by the Fifa World Cup.
As a result of the ad pressures, it said, content spend will be cut by £10 million to £1.29 billion in 2023, with plans to push this into next year instead.
Shares in the FTSE 250 listed group fell more than 6% in morning trading on Wednesday.
Chief executive Dame Carolyn McCall said: “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.
“We are on track to deliver £15 million of cost savings in 2023, as part of our previously announced £50 million cost saving target between 2023 and 2026.
“In addition, we will rephase £10 million of content spend from 2023 into 2024.”
Its studios arm, which also produces popular series such as The Voice, Queer Eye and Line Of Duty, delivered a 9% rise in revenues to £1.5 billion over the first nine months of 2023.
Its digital ad revenues in the wider business jumped 25%, while its content streaming hub, ITVX, helped wider digital turnover lift 23%.
But it said the content market is being held back in the short term by the US writers’ and actors’ strikes, which is set to hit 2024 revenues, deferring some of this into 2025.
It is expecting full-year studios revenue growth to pull back sharply to 3% in 2023, down from 19% in 2022.