TV Ad Revenue Declines Across the Board

TV Ad Revenue Declines Across the Board

News by Roberto Orosa
Published: November 15, 2023

In the latest quarterly earnings reports from major TV network owners, a common trend emerged — ad revenues for traditional TV witnessed a significant annual decline.

Streaming ad revenues, while on the rise across the board, failed to compensate for the losses in the traditional TV sector.

Leading the downturn were TV giants like AMC Networks (down 18%) and NBCUniversal (down 8.4%). At the same time, Paramount and Warner Bros. Discovery reported drops of 8.7% and 9.9%, respectively.

Despite the plunge, networks such as Fubo and Roku were the outliers — the only two streaming-only companies on the list. The two reported a substantial increase in streaming ad revenues — 34% and 18%, respectively.

Streaming Ads Take the Spotlight

Reports from Paramount and Warner Bros. Discovery highlight the growing disparity by breaking out streaming ad revenues separately from traditional TV ad revenues.

Paramount saw a noteworthy 18% increase in streaming ad revenue, while traditional TV ad revenue plummeted by 14%. Similarly, Warner Bros. Discovery reported a 30% surge in streaming ad revenue but faced a 12% decline in traditional TV ad revenue.

The financial gap between streaming and traditional TV ad revenues is stark. Paramount faced a $1.27 billion difference, and Warner Bros. Discovery confronted a $1.57 billion gap.

Even Hulu, a major ad-supported streaming platform, experienced challenges.

The platform's average revenue per user (ARPU) for primary subscribers and pay-TV subscribers decreased due to lower ad revenue. Hulu's ties to traditional TV programming likely contributed to this decline, accentuated by external factors such as the impact of strikes on viewership.

The outlook for traditional TV ad business appears challenging, with continued slow advertising trends anticipated. Industry leaders express caution, with Roku remaining cautious amid an uncertain macro environment and an uneven ad market recovery. 

In an evolving media landscape, the struggle between traditional TV and streaming platforms for ad revenue supremacy continues, with uncertainties clouding the industry's future.

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