AVOD revenue soars as ITV predicts ad spending to hit record level

Carolyn McCall

UK commercial broadcaster ITV has posted strong results for its first nine months in a trading update, with growth in both its media & entertainment and studios businesses.

Total revenue was up 28% at £2.38bn and up 8% compared to the pre-pandemic year of 2019. ITV said that ad revenue for the full year was now expected to be the highest in its history, up by 24%.

Restructuring results

The results follow a major restructuring last year that saw the creation of a ‘media & entertainment’ arm, made up of a broadcast-focused unit and a streaming division.

Media & entertainment revenue was up 26% at £1.59bn with total advertising revenue up 30%. AVOD revenue was up 54%, with the division’s overall revenue up 9% compared to 2019.

ITV Studios revenue, meanwhile, was up 32% at £1.19bn, an increase of 6% on 2019.

The broadcaster did particularly well in online viewing, which was up 39%, even though ITV total viewing time was down 5% compared with last year, which saw a boost in numbers from the COVID lockdown.

Monthly average users of ITV’s AVOD offering were up 22% to 9.6 million, and ITV said it was on track to double the number of hours of content available on ITV Hub over 2021.

Carriage & comment

ITV has also agreed a new multi-year carriage relationship with Virgin Media, which includes the full integration of the ITV Hub platform, both on Virgin Media’s existing set top boxes and new IP product.

The company said that this deal, along with its new Sky agreement, will enable it to increase its digital addressable advertising inventory and deliver linear addressable advertising.

“By any standards ITV has had an outstanding nine months,” said CEO Carolyn McCall.

She said that ITV was “becoming an increasingly scaled digital business” and pointed to the expected record ad revenues, which she said was driven by the combination of broadcast and ITV Hub’s “mass simultaneous reach”.

McCall said that the studios unit had continued to “attract and support brilliant creative talent delivering significant growth in the UK and internationally” and that “revenue from streamers globally is growing very strongly” alongside the supply of content to the BBC and ITV.

“Today’s results further illustrate that ITV has successfully completed the first phase of its More Than TV strategy and is accelerating the second phase of digital transformation as we evolve our products, user experiences and ways of working,” she said.