Fremantle owner RTL warns “continued weakness” in TV advertising market hit third quarter revenue

European broadcasting giant RTL warned of “continued weakness” in the TV advertising market as revenue fell more than 10% year-on-year in the third quarter.

Group sales in the quarter totaled €1.6 billion, with timing effects in the Fremantle production division and the TV advertising market cited as organic reasons. For the year as a whole, sales are now expected to fall by around 100 million euros to 6.9 billion euros, while adjusted EBITA will reach 50 million euros against 900 million euros.

In the third quarter statistics, TV advertising revenue fell by 3.7% and expectations changed from small growth to a mid-single digit decline in the second half of 2023. However, RTL’s family of channels has market share in its main market, Germany, won compared to its biggest commercial competitor ProSiebenSat.1. RTL boss Thomas Rabe added in September: “The decline in TV advertising revenue has slowed significantly.”

Like its British counterpart ITV, RTL’s problems in linear broadcasting this year were partially offset by better numbers in digital. While initial full-year losses are expected to be around €200m, RTL+ and Dutch VOD service Videoland now have a combined 6.2m paying subscribers, up 30.3% year-on-year, and streaming revenue has 21% up to €236 million in the nine months to the end of September. RTL aims to stream sales of 1 billion euros and profitability in 2026.

Got talent Manufacturer Fremantle reported a 21% drop in third-quarter revenue to €527 million, with lower buyer activity, TV ad placements and “an exceptionally strong performance in the third quarter of 2022” all as year-over-year declines named. However, it is a matter of delivery Priscilla, Domino Day, Mamma Mia! i have a dream, Heligoland And World War II: From the Front in the fourth quarter and recently raised a €150 million fund to finance high-end scripted TV and film projects starring Angelina Jolie Maria the first to benefit.

RTL continues to challenge Fremantle bosses to increase annual revenue to €3 billion by 2025, with the producer and distributor aiming to achieve this through organic growth and acquisitions. We revealed earlier this year that the company had spent more than a quarter of a billion dollars on production investment in recent years, although RTL ruled out a deal with Fremantle rival All3Media.

“Despite challenging market conditions, we are striving to transform our businesses with significant investments in streaming and technology,” says Rabe, CEO of RTL.

“Our streaming business has grown significantly, with approximately 1.5 million net subscribers in the last twelve months. In October, we launched a major marketing campaign for Germany’s first all-inclusive entertainment program RTL+ – with video, audio and text in one app.

“As expected, the decline in TV advertising revenue slowed significantly in the third quarter and we recorded strong development across the group in September. However, at the start of the fourth quarter, European advertising markets appeared to be weaker than expected and, despite countermeasures, we had to adjust our outlook.”