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European media giant RTL Group, the parent company of production powerhouse Fremantle, saw revenue and profits slump in the first half of this year as ad sales remained soft, particularly in the company’s core German market.

First-half revenue slipped 5.1 percent to €3.1 billion ($3.4 billion), adjusted EBITA profits slumped to €250 million ($275 million), half what they were in H1 2022, and group profit fell more than 56 percent to €132 million ($145 million).

Streaming growth provided the only slim silver lining in RTL’s first-half figures. RTL Group’s streaming services, RTL+ and Videoland, showed robust growth, with subscriber figures surging 34 percent to 6 million and streaming revenue up 16.9 percent to €152 million ($167 million).

Still very much a traditional broadcasting group and heavily reliant on the free-TV advertising market, RTL has struggled to diversify by expanding its SVOD offerings, which included streaming services RTL+ and Videoland.

“The market environment in the first half of 2023 was particularly challenging, with geopolitical and macroeconomic uncertainties in addition to the long-term structural shifts in video viewing,” said RTL CEO Thomas Rabe, who said the company would be “investing into business transformation through the cycle” by putting money into “premium content, leading national streaming services and in advertising technology.”

AI is also a priority.

“Technology plays a key role in our transformation, and we see great opportunities from Artificial Intelligence, in particular to increase efficiency and generate content,” Rabe said. “Today, we already apply AI at scale in advertising planning and have started to support content creation with generative AI.”

For the full year, RTL Group is projected an adjusted EBITA of approximately €950 million ($1.04 billion) after start-up losses on its streaming services of around €200 million ($220 million).

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