ITV shares rose on Thursday after the broadcast and studios group beat expectations, with strong performance in its studio business helping offset weakness in advertising.
ITV Studios enoyed 10% growth in external revenue driven by strong demand from global streaming platforms. Its content library business, Zoo 55, achieved double-digit revenue growth through digital distribution. Studios’ adjusted EBITA came in at £297m, marginally below the prior year’s £299m.
The Media & Entertainment division continues to be a drag and will fuel the argument that the group should be split up. M&E saw total revenue fall 5%, with total advertising revenue declining 5% against a tough 2024 comparative that benefited from the Men’s Euros.
However, ITVX continued its strong momentum with viewing up 16% and digital advertising revenues rising 12%. M&E adjusted EBITA fell 6%, cushioned by significant cost savings.
“ITV’s full-year 2025 results are a tale of grit amid gloom with flat revenues but profits resilient ahead of forecasts,” said Adam Vettese, market analyst for eToro
The group confirmed it remains in discussions with Sky over a possible sale of the M&E business, following its November announcement, though cautioned that there is no certainty a deal will be reached.
A potential deal, coupled with a slight beat of expectations, helped shares 4% higher on Thursday.
“ITV remains locked in takeover talks with Sky to sell its broadcasting and streaming arm,” said Dan Coatsworth, head of markets at AJ Bell.
“This keeps hopes alive for what could be the most significant deal in the UK media space for a long time. Getting a deal over the line would be transformational for ITV, leaving it free to focus its entire energy on content creation.”
ITV Studios is expected to deliver another year of revenue growth in 2026, with adjusted EBITA margin at the lower end of the 13-15% range.
First-quarter advertising revenue is forecast to be down around 2%, better than feared, with budgets being held back ahead of the expanded Men’s Football World Cup in the summer. ITV is showing 19 more matches than in 2022 and expects a strong advertising performance around the tournament.