STV Shares Slump as Advertising Revenue Drops and Projects Stalled

Shares in STV Group plummeted to a twelve year low after the Scottish media company warned that revenue and adjusted operating profit for the year would be significantly below market forecasts. The company, which operates the Channel 3 television licence in Scotland and runs the digital STV Player and STV Studios production arm, released an unscheduled trading update revealing the disappointing outlook.

STV Group shares fell as much as 25 per cent to 138p, eventually closing down 49p at 142p. The sharp decline came after the company said it now expects full year revenues between £165 million and £180 million, well below analyst expectations of more than £190 million. Adjusted operating profit projections have also been slashed, with Progressive Equity Research reducing its forecast from £18.5 million to £11.2 million, while Panmure Liberum revised its number from £18.1 million to £11.5 million. The company posted revenue of £188 million and profit of £13.1 million in 2024.

During the first half of 2025, advertising revenue dropped by 10 per cent, in line with internal guidance. The picture has worsened in recent months, with STV forecasting an 8 per cent year on year decline in third quarter revenue. The audience division expects to take in between £90 million and £95 million in this period. Disruption to the commissioning of new shows has been a particular challenge for the company, with a number of projects in late stage development yet to receive final approval, and others postponed until 2026. The company’s unscripted division, spanning reality television, quiz and entertainment formats, has felt the biggest impact.

Scripted drama however has remained relatively resilient. Recent successes include the third series of BBC crime drama Blue Lights and Amadeus, a period drama for Sky depicting Mozart’s life. Studio revenues for 2025 are projected between £75 million and £85 million, though the forward order book has dropped to £54 million from £66 million this April.

Chief executive Rufus Radcliffe, who joined STV in November last year, reiterated plans to launch a new radio station and emphasised the company’s long term growth potential. He cited the challenging macroeconomic environment as a key factor impacting confidence within the markets STV serves. The company has identified a further £750,000 in cost savings for the year, bringing total annual savings to £2.5 million, with expectations of more efficiencies next year. To manage costs, STV has made a small number of redundancies and cut back on discretionary spending.