Network18 posts 49% hike in operating revenue amid programming cuts

In the financial year 2023-24, Network18 faced a slowdown in its entertainment sector, with advertising revenue remaining flat due to reduced programming hours in response to a soft advertising market.

However, the media giant has posted a robust 49.4% growth in operating revenue for the financial year 2023-24, reaching Rs 9,297 crore, driven by strong performance in its news and digital segments.

Network18's annual report highlighted these contrasting trends, as it navigated challenges in key advertising segments while capitalizing on opportunities in news and digital platforms.

“In the TV segment, news businesses delivered strong growth in advertising revenue, powered by the strong position of the channels across markets and increased advertising spending in the run-up to the general elections.

“Advertising revenue in the Entertainment segment was flat as the business reduced original programming hours due to the soft advertising environment. In the Digital segment, both entertainment and news business delivered growth, led by JioCinema. First season of Indian Premier League (IPL) on JioCinema was a blockbuster, both in terms of delivering record operating KPIs as well as revenue,” the company said in its annual report.

The media house does not disclose advertising revenue separately, but its consolidated advertising, subscription, and program syndication revenue reached Rs 8,076.6 crore in FY24, marking an increase from Rs 5,537 crore in FY23, representing a growth of 45.8%.

Network18 also faced a significant rise in operating expenses, which rose by 63.7%, from Rs 6,085 crore in FY23 to Rs 9,961 crore in FY24, driven primarily by the high costs of premium sports rights and increased investments in the digital segment.

This surge in expenses led to a significant decline in profitability, with the profit after tax (PAT) for FY24 reporting a loss of Rs 324 crore, compared to a loss of Rs 15.8 crore in the previous year.

Ongoing investments in key growth areas, such as sports and digital, have significantly impacted the company’s bottom line.

According to the media house, the FMCG sector, the largest advertising segment, saw subdued demand growth throughout most of the year.

“While commodity prices moderated from their peak levels, leading to some recovery in the second half of the year, demand from FMCG brands remained tepid. Some brands increased their advertising spend to boost consumer demand, but new-age clients like e-commerce and D2C brands continued to hold back, affected by the ongoing slowdown in funding and soft consumer demand, especially in television advertising,” it explained.

Apart from the combined ad and subscription revenue, the operating revenue of the company includes the Sale of Content, Content Production, Film Distribution and Syndication which also went up from Rs 607.8 crore in FY23 to Rs 1,101.5 crore in FY24. The revenue from the sale of products went down from Rs 1.28 crore to Rs 67 lakhs. Other categories under operating revenue saw a jump from Rs 76.5 crore in FY23 to Rs 118.6 crore in FY24.

In October, TV18 and E18 merged with Network18 after getting a nod from the National Company Law Tribunal (NCLT).