ITV plc (IJ7) Q2 2026 Earnings Report

The call presents a broadly positive operational and strategic picture driven by a transformational M&E transaction, strong digital growth (ITVX viewing +27%, digital revenue +13%), advertiser gains, and a healthy balance sheet (net debt GBP 652m, leverage 1x). However, near-term profitability and timing risks remain: Studios EBITA and margin were down, Group EBITA is flat with H2 weighting, Q3 advertising is expected to decline ~5%, working capital has reduced cash conversion, and the Sky transaction faces regulatory review that could delay completion. On balance the highlights (transformative deal, clear capital returns, digital and advertiser momentum, cost discipline) outweigh the lowlights (margin pressure, near-term ad softness, regulatory timing risk).

Management left full‑year guidance unchanged: ITV Studios is expected to deliver good total revenue growth with EBITA margins landing at the lower end of its 13–15% target range, while M&E should continue strong, profitable digital revenue growth but with Q3 TAR expected to be down around 5% (implying TAR for the first nine months broadly flat YoY). In H1 Studios revenue grew 2% to GBP 912m (3% organic) with EBITA down 9% to GBP 97m (11% margin); M&E delivered GBP 850m of advertising revenue (up 3%), digital revenue up 13% to GBP 307m, ITVX viewing +27% with June >20m MAUs, and segment EBITA up 37% to GBP 48m; group content costs were reduced 2% while non‑content costs (ex‑marketing) were up 3% with GBP 4m of permanent savings YTD. The balance sheet remains strong with net debt of GBP 652m, leverage ~1x, profit‑to‑cash conversion 63% (rolling 12 months), a target of GBP 20m of cost savings for the full year (cumulative GBP 273m since 2019), an interim dividend of GBP 0.017/share, a GBP 100m buyback (expected to run c.9–12 months) and an anticipated GBP 950m net cash return on completion of the M&E sale to Sky.