ITV (LON:ITV) executives said the broadcaster and producer delivered a “good performance” in 2025, outperforming market expectations despite a challenging backdrop for linear advertising, while highlighting progress in shifting the group toward studios and digital revenues and maintaining a steady dividend.
CEO Carolyn McCall told investors the company has become “much leaner and more agile” with a stronger digital platform, adding that two-thirds of total revenue now comes from ITV Studios and Media & Entertainment (M&E) Digital. McCall also addressed a November leak around a potential transaction, confirming ITV is in preliminary discussions with Sky regarding a possible sale of the M&E business and said the company would provide an update when it can.
ITV Studios revenue rises; mix weighs on margin
CFO and COO Chris Kennedy said ITV Studios continued to show “strong momentum,” with total revenue up 5% to £2.13 billion. External revenue increased 10%, which Kennedy attributed to a shift toward global streaming partners and scaling digital distribution through Zoo 55.
Kennedy said the U.S. unscripted business delivered a good year with a strong slate, highlighting Love Island USA as the most-watched streaming TV original season of 2025 in America, which he said increased the value of the format. However, he noted overall U.S. performance was down year over year due to the phasing of deliveries and “some short-term market softness,” adding that ITV is seeing momentum in 2026 and expects the year to be “much stronger.”
Studios’ U.K. and international arms recorded 14% revenue growth driven by demand from streamers and broadcasters. Adjusted EBITDA for Studios was £297 million and the EBITDA margin was 13.9%. Kennedy said the year-over-year margin movement reflected a lower proportion of high-margin catalog sales in the revenue mix, consistent with prior guidance.
Management also emphasized ongoing efficiencies, with Kennedy citing £31 million in cost savings at Studios during the year.
Digital ad growth offsets weaker linear trends in M&E
In Media & Entertainment, Kennedy pointed to continued growth in ITV’s digital business. Digital advertising revenue rose 12% to £540 million, while total digital revenues increased 10% to £614 million. Kennedy credited ITVX, Planet V, and data-driven advertising products for the performance.
Total advertising revenue declined 5% for the year, which Kennedy said was better than guidance. He described digital growth as a “profitable hedge” against double-digit declines in linear advertising.
ITV also highlighted cost discipline in M&E. Content costs fell 5% and non-content costs declined 6%, with Kennedy outlining £32 million in permanent savings and £15 million in temporary savings. Despite lower advertising revenue, M&E’s adjusted EBITDA margin held steady at 11.8%, according to the CFO.
Cash generation, leverage, and efficiency program
Kennedy said ITV ended 2025 with net debt of £566 million and a leverage ratio of 1x, describing the balance sheet as robust. Profit-to-cash conversion was 65% “as expected,” and Kennedy said three-year cash conversion from 2023 to 2025 averaged around 80%, in line with the company’s target.
On capital allocation, Kennedy reiterated management’s stated priorities: reinvest for profitable growth, maintain an investment-grade balance sheet, and return surplus cash to shareholders. He added the company has maintained an ordinary dividend of £0.05 and continues to keep its capital structure under review.
ITV also discussed ongoing cost reduction efforts. Kennedy said the group delivered £63 million in permanent non-content savings across the business in 2025, bringing cumulative permanent savings since 2019 to £253 million.
Strategy updates: acquisitions, Zoo 55, ITVX and Planet V
McCall restated ITV’s strategic vision to lead in U.K. advertiser-funded streaming while building a diversified global content business, summarizing the plan as three pillars: expanding studios, supercharging streaming, and optimizing broadcast.
In Studios, McCall pointed to recent acquisitions in 2025 including Moonage Pictures in the U.K. and Plano a Plano in Spain, and said the company continues to enhance its talent position through acquisitions, deals, and partnerships. She also cited format and franchise expansion, including Love Island in 28 markets and Netflix’s Squid Game: The Challenge, which she said has been recommissioned for a third series.
McCall said ITV’s IP library now exceeds 100,000 hours and is licensed to more than 350 customers globally, generating £400 million of “high-margin revenue” through global partnerships. She described Zoo 55 as a key growth area spanning social video, FAST/AVOD platforms, and games and gaming. ITV said Zoo 55 generated more than 47 billion global views in 2025, up over 30% year on year, and remains on track to achieve £120 million of high-margin digital revenue by the end of 2027.
In M&E, McCall said ITVX has delivered a 25% compound annual growth rate in total streaming hours and a 16% CAGR in digital advertising revenues since its 2022 launch. She said Planet V leverages first-party data from more than 40 million registered users and has brought in more than 1,500 new advertisers since launch, with digital advertising now representing 31% of total advertising revenues.
McCall also said ITV has pivoted its digital strategy by “doubling down on AVOD” and deprioritizing subscription video on demand, which she said will extend the timeline to reach the £750 million digital revenue target but has reduced incremental content and marketing spending. She added that ITVX reached break-even “two years earlier than planned,” recouping investment four years earlier than projected.
2026 outlook: studios growth, sports-driven ad tailwinds, and market commentary
Looking ahead, Kennedy said ITV Studios is expected to deliver good revenue growth in 2026, with margins at the lower end of the target range. As is typical, he said revenue, profit, and margin will be weighted to the second half, with momentum continuing into 2027.
For M&E, management said digital revenue should continue its strong trajectory in 2026. Kennedy said ITV expects first-quarter total advertising revenue to be down around 2%, which he said was better than expected.
The company also emphasized a stronger sports schedule, including being the only commercial broadcaster of the expanded FIFA Men’s Football World Cup and the new Men’s Rugby Nations Championship, which management said will support advertising revenue from the second quarter onward.
In the Q&A, executives discussed advertising conditions, saying Q4 weakness reflected a pause by advertisers as budgets were set and that Q1 had improved month-by-month. Management said conversations tied to the World Cup were active, noting it was speaking with around 100 advertisers across 20 categories, while declining to quantify a tournament-specific uplift.
ITV also addressed the use of AI, describing efforts to embed tools across the Studios workflow and to incorporate AI-enabled efficiencies into its broader continuous cost improvement program, while emphasizing that the company views AI as both an efficiency driver and a way to redeploy resources toward higher-value creative work.
On addressable capability, management said that by the end of 2025, 30% of linear inventory was capable of carrying a targeted ad, with a goal of reaching 50% by the end of 2026, while noting the company would choose between targeted and mass-reach use depending on advertiser objectives and programming.
About ITV (LON:ITV)
ITV is a vertically integrated producer broadcaster and streamer, consisting of ITV Studios and Media & Entertainment.
ITV Studios is a scaled and global creator, owner and distributor of high-quality TV content. It operates in 12 countries, across 60+ labels and has a global distribution network. It is diversified by genre, geography and customer in the key creative markets around the world.
Media & Entertainment is the largest commercial broadcaster and streamer in the UK, delivering unrivalled audience scale and reach.
