ITV plc (ITV) Ordinary 10p

- Add to watchlist
- Create an alert
- This stock can be held in a




HL comment (24 July 2025)
No recommendation - No news or research item is a personal recommendation to deal. All investments can fall as well as rise in value so you could get back less than you invest.
ITV’s first-half revenue fell by 1% to £1.6bn. Growth in ITV Studios was more than offset by a decline in total advertising revenue, which was largely due to last year’s numbers benefitting from the 2024 men’s Euros.
Underlying cash profit (EBITA) dropped 33% to £142mn. This reflects the lower advertising revenue, and weighting of higher-margin content sales to the second half this year.
On a 12 month view, free cash flow improved from an outflow of £19mn to an inflow of £43mn, due to favourable timing of cash payments and receipts. Net debt rose from £0.5bn to £0.6bn.
In the third quarter, total advertising revenue is expected to decline “marginally”. ITV Studios expects “good growth” in total revenue, ahead of the global content market, with margins in the 13-15% range.
An interim dividend of 1.7p per share was announced, in line with the prior year.
The shares rose 4.4% in early trading.
Our view
ITV was always going to have a tough start to the year, partly due to higher-margin content sales being weighted to the second half. But despite a sharp drop in first-half profits, numbers weren’t as bad as markets were forecasting, and the shares reacted positively on the day.
ITV relies on companies paying to advertise on its traditional television channels. Given the structural decline of broadcast advertising, moving ITV's top line in the right direction is very difficult. And due to the Men’s Euros 2024 boosting performance last year, the group came up against some tough comparable numbers over the first half.
One bright spot is digital advertising. ITVX continued its stellar run, with streaming hours continuing to grow at double-digit rates. With more eyeballs on ITV’s shows, digital advertising revenues are flowing in, giving management confidence that by 2026, digital advertising revenues will exceed £750mn (2024: £482mn).
We’re pleased with the continued momentum, but it’s still relatively early days. The digital offerings don't yet have enough scale to carry the weight of weakness in the free-to-air side of things.
We must point out the sheer scale of competition in this sector – think Netflix or Amazon Prime Video. The competition has substantially deeper pockets to throw at growing market share. It’s an expensive arena to play in, and any future ramp-ups in production will likely weigh on cash flows.
The Studios business is arguably ITV’s crown jewel. It makes and distributes shows in the UK and abroad. Some of these are sold back to ITV's Media & Entertainment business, but other blockbusters like Line of Duty are made for others. The sale of these programmes isn’t currently directly impacted by US tariffs.
Helped by the sale of its stake in BritBox International last year, the balance sheet remains in good shape, adding a layer of flexibility to operations. There’s also a generous 6.3% dividend yield on offer. But please remember, no shareholder return is ever guaranteed, especially when the outlook remains rocky for the group.
Given ITV's low valuation relative to many of its peers and the quality of the Studios business, there’s been plenty of speculation about takeover bids in recent times. That’s likely to remain the case in the near term and be the main driver of the share price until other parts of the business improve performance. But given the structural decline in broadcasting advertising, it’s not likely to be a swift turnaround.
Environmental, social and governance (ESG) risk
The media industry’s ESG risk is relatively low. Product governance is the key risk driver, alongside business ethics, labour relations and data privacy & security.
According to Sustainalytics, ITV’s management of ESG risk is strong. Its environmental policy is adequate and executive remuneration is explicitly linked to sustainability performance targets. However, its overall ESG reporting falls short of best practice.
ITV key facts
Forward price/earnings ratio (next 12 months): 9.2
Ten year average forward price/earnings ratio: 9.4
Prospective dividend yield (next 12 months): 6.3%
Ten year average prospective dividend yield: 5.8%
All ratios are sourced from LSEG Datastream, based on previous day’s closing values. Please remember yields are variable and not a reliable indicator of future income. Keep in mind key figures shouldn’t be looked at on their own – it’s important to understand the big picture.
This article is original Hargreaves Lansdown content, published by Hargreaves Lansdown. It was correct as at the date of publication, and our views may have changed since then. Unless otherwise stated estimates, including prospective yields, are a consensus of analyst forecasts provided by Refinitiv. These estimates are not a reliable indicator of future performance. Yields are variable and not guaranteed. Investments rise and fall in value so investors could make a loss.
This article is not advice or a recommendation to buy, sell or hold any investment. No view is given on the present or future value or price of any investment, and investors should form their own view on any proposed investment. This article has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is considered a marketing communication. Non-independent research is not subject to FCA rules prohibiting dealing ahead of research, however HL has put controls in place (including dealing restrictions, physical and information barriers) to manage potential conflicts of interest presented by such dealing. Please see our full non-independent research disclosure for more information.
Previous ITV plc updates
The London Stock Exchange does not disclose whether a trade is a buy or a sell so this data is estimated based on the trade price received and the LSE-quoted mid-price at the point the trade is placed. It should only be considered an indication and not a recommendation.
Trades priced above the mid-price at the time the trade is placed are labelled as a buy; those priced below the mid-price are sells; and those priced close to the mid-price or declared late are labelled 'N/A'.