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ProSiebenSat.1 sees revenues down again in third quarter but positive about future

German media group ProSiebenSat.1 suffered another decline in revenues through the third quarter of 2023 but says there is light at the end of the tunnel after a tough year in the economy and ad market.

Bert Habets

Third quarter revenues of ProSiebenSat.1 were down 3% year on year from €911m (US$975m) to €888m. This decline was put down to the continuing weak economy and the associated cautious approach to advertising budgets which have beset ProSiebenSat1’s results all year.

By contrast, advertising revenues from digital entertainment offerings in the German-speaking region (Germany, Austria, Switzerland), such as streaming platform Joyn, have increased. This, and growth in the commerce & ventures sector, have helped offset the decline in traditional TV ad revenues.

However, the executive board warned of the ongoing consumer slump and the lack of recovery in the markets, which is why revenue in 2023 is likely to be lower than expected.

Revenue for the current year is now expected to be “slightly below” €3.95bn. Previously, the group had forecast between €3.95bn and €4.25bn.

External revenues in the entertainment division amounted to €598m in the third quarter of 2023, 4% below the previous year’s figure of €621m. Against the backdrop of the macroeconomic environment, advertising revenues in the German-speaking region decreased again compared to the previous year, although the decline of 5% was significantly lower than in the first half of the year.

At the same time, digital and smart advertising revenues in the German-speaking region grew by 16%, partially offsetting the decline in TV advertising revenues. Joyn in particular saw significant growth.

Group CEO Bert Habets said that after the advertising market was challenging for ProSiebenSat.1’s business in the first half of the year, the group’s financial performance stabilised in the third quarter of 2023. At the same time, the group successfully completed its announced cost and efficiency programme at the end of October.

Habets said: “We have taken the challenges in the market as an opportunity to realign our group in terms of both personnel and organisational. In doing so, we are setting the course to expand our digital business areas more strongly.

“At the same time, we have now successfully implemented the cost efficiency programme that we initiated at the beginning of the year. This applies above all to the entertainment segment, but we have also responded to the declining revenues in the dating & video segment.

“We are confident and see a positive trend in the third quarter: Joyn recorded a very good quarter once again with an increase of 58% in AVoD advertising revenues, while the audio segment and programmatic trade of advertising time also increased their revenues dynamically. We will fully realise the savings from our efficiency programme in the fourth quarter respectively in 2024.”

Looking forward, although the company believes the economic weakness in the German-speaking region is likely to continue, it thinks private consumption in Germany should gradually recover and ProSiebenSat.1 again expects a slightly improved revenue and earnings performance in the fourth quarter of 2023.

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