ITV plc Beats Expectations in 2025 Results, Driven by Digital Growth and Strategic Moves

Subscription revenue held flat at £48 million and UK premium subscribers ended the year at 0.9 million (down 10%), but ITV says ITVX has already recouped its entire investment – four years ahead of plan. M&E adjusted EBITA fell 6% to £234 million, cushioned by significant cost savings.

Costs, cash and dividend: discipline continues

ITV delivered £63 million of permanent non-content cost savings in 2025, plus £15 million of temporary M&E savings to navigate softer Q4 ads. Cumulatively, £253 million of permanent savings have been achieved since 2019. Exceptional items totalled £107 million, mainly restructuring and corporate transaction-related costs.

Profit to cash conversion came in at 65% (down from 83%) and net debt rose to £566 million, leaving leverage at a comfortable 1.0x. The full-year dividend of 5.0p signals confidence in cash generation, aligning with policy.

2026 outlook: H2-weighted profits, football tailwind and more savings

• Studios: “another year of good growth” in 2026, with full-year adjusted EBITA margin expected at the lower end of 13%-15%. Revenue, margin and profit are H2-weighted due to scripted deliveries and high-margin licensing timing.
• M&E: continued strong, profitable digital ad growth via ITVX; non-ad digital revenues to expand further.
• Advertising set-up: Q1 2026 TAR is forecast down around 2% (better than expected). Advertisers are holding back for Q2/Q3 around the expanded Men’s Football World Cup, where ITV shows 19 more matches than in 2022 and more at peak time.
• Costs and investment: another £20 million of permanent non-content savings planned in 2026; total content spend expected around £1.225 billion; adjusted financing costs around £40 million; adjusted effective tax rate around 27%; capex around £60 million. Exceptional items expected around £55 million.

Strategic wildcard: possible M&E sale to Sky

ITV remains in discussions with Sky regarding a potential sale of the M&E business. There is no certainty a deal will happen. If it did, it would be a major reshaping of ITV – potentially sharpening the focus on Studios and licensing while crystallising value in broadcast/digital distribution. For now, treat it as optionality rather than a base case.

My read: what’s good, what’s not, and why it matters

Positives I like

• Delivered ahead of expectations despite a softer ad market – helped by £63 million of permanent savings.
• Studios growth outpaced the market, with 10% external revenue growth and rising exposure to streamers (28%).
• ITVX is clearly working: viewing +16%, MAUs +12%, digital ad +12%, and the platform has already paid back its investment early.
• Dividend held at 5.0p alongside modest leverage of 1.0x – income intact with balance sheet headroom.

Areas to watch

• Adjusted EPS fell 11% and statutory EPS 43% (the latter distorted by 2024’s BritBox International disposal gain). Sustained EPS growth still needs delivery.
• Margins eased (Studios to 13.9%, Group to 15.2%) and profit-to-cash conversion dipped to 65% – working capital discipline will be key in 2026.
• Linear TAR remains a headwind even in a better Q1 set-up; execution around the World Cup will matter.
• Subscriber decline (0.9 million, -10%) shows premium SVOD remains competitive, though ad-funded viewing is the clear engine.

Big picture: management says two-thirds of revenue now comes from ITV Studios and digital M&E – that’s the transformation story. If Studios continues to grow ahead of the market and ITVX keeps compounding ad-funded digital gains, the mix shift should support resilience and optional growth in a choppy ad cycle.

What to track next

• Q1 TAR (guide: down ~2%) and the World Cup advertising performance in Q2/Q3.
• Studios H2-weighted deliveries and licensing deals – watch margin cadence versus the 13%-15% range.
• Digital monetisation: continued double-digit growth in digital ad revenue and MAUs/streaming hours.
• Cash conversion trends and progress on the extra £20 million cost saves.
• Any update on the possible M&E transaction with Sky.

Further reading and webcast access

• Full preliminary results (FCA storage): View on FCA NSM
• Results PDF: Download the RNS PDF
• ITV results centre: ITV investor hub
• 9:00am webcast and Q&A: Register to join (UK dial-in +44 20 3936 2999, Access Code: 183046)

Overall, I’d call this a disciplined, digitally-led delivery year. Not perfect, but ahead of where many feared – and set up with sport, savings and Studios to push on in 2026.