Advertising revenue should stabilize for media companies in 2025

The advertising market has positive momentum heading into 2025, especially for media companies with sports rights and blockbuster live programming.

Sports and live events, such as award ceremonies, reigned supreme in conversations with media executives who weighed in on their expectations for the advertising market in the coming year. The end of uncertainty around the election has also helped improve the outlook, they said.

And even as consumers flee traditional TV packages, with more advertising dollars going to streaming, executives emphasized that traditional TV remains important in conversations with advertisers, especially when it comes to sports.

Overall, executives said they expect stability in the market and hope to overcome the slowdown in advertising spending in recent years.

“Standardization is the right way to say it in the advertising market,” said Mark Marshall, president of global advertising and partnerships at NBCUniversal. “Once the election is resolved, many companies feel that the uncertainty about it has disappeared.”

He added that the company has seen more dispersed market budgets arrive during the fourth quarter, which is what the industry calls the buying and selling of ads closer to their air date compared to ads that are bought further away.

“Our first quarter looks really strong. I think any election year is a challenge for anyone in the fourth quarter because a lot of marketers end up sitting on their hands as the airwaves and digital are crowded,” said Dan Porter, CEO of sports. media company Overtime. “I think that's true for us and it's true for everyone.”

However, despite the increase in advertising revenue after the election and the stability of the forecasts, Natalie Bastian, global marketing director at Teads, said she expects many of the same trends.

Bastian noted that 2024 included important moments such as the Summer Olympics and the presidential election, which strengthened television advertising revenue. However, he expects the same budgets to carry over into the new year.

“What we've heard in general from some of our closest partners… media budgets are not growing, so there are simply more options about where [advertisers are] spend their money,” Bastian said. This makes sports and live programming that much more important to media companies.

Overall, the global advertising industry is expected to surpass $1 trillion in total revenue for the first time this year, excluding US political advertising, and will grow 7.7% in 2025 to reach $1.1 trillion. dollars, according to a recent report by GroupM, WPP's media investment. cluster. Advertising on digital platforms, which includes retail media as a segment, is what is driving that increase.

Television, considered “the most effective form of advertising”, is expected to grow almost 2% in 2025 to reach $169.1 billion in total global advertising revenue. By comparison, advertising revenue for the “pure digital game,” which excludes “digital extensions of traditional media” like streaming but includes platforms like YouTube and TikTok, is expected to grow 10% to $813.3 billion globally. worldwide in 2025, according to GroupM. .

Sports continue to attract large audiences and advertisers, leading media companies to pay considerable sums for the rights to games.

Commercials during live sports generated 24% more engagement than other programming, according to EDO, an advertising data company.

“Live event coverage will continue to be a cornerstone of media engagement, and streaming services must up their game,” said Tim Hurd, vice president of media at Goodway Group. “As more streaming platforms dive into sports, the challenge will be to keep viewers engaged, not just by offering content, but by improving the overall experience with personalized, non-disruptive ad units.”

ComcastNBCUniversal said the Summer Olympics in Paris generated a record $1.2 billion in advertising revenue. It seemed to have paid off, as the company reported a total audience of more than 30 million people across NBC's streaming and television platforms.

Fox Corp. Executives have said the company has already sold out of Super Bowl ads for next February, which reportedly cost about $7 million each. The 2024 Super Bowl is estimated to have had 123.7 million viewers.

AND disney said it had sold out of ads for its Christmas Day NBA games two weeks before they aired. The company added that it is “substantially accelerating” throughout the NBA season in terms of advertising revenue compared to last year, and that “early movement has already been seen” for the postseason in the dispersed market.

Viewership for women's sports, driven in particular by the WNBA, has also increased in the past year, meaning more opportunities for advertisers.

“This goes beyond Caitlin Clark, even though she is a huge catalyst,” said Josh Mattison, executive vice president of digital revenue pricing, planning and operations at Disney Advertising. “This was a transformative year in terms of audiences.”

WNBA viewership hit a record high in 2024 and consumers were 16% more likely to engage with ads during these games compared to last year, according to EDO. But while advertisers spent $8.5 billion on TV sports ads in 2024, women's sports only accounted for 3% of that figure, according to EDO, leaving plenty of room for growth next year.

The growing popularity of women's sports and its importance to media companies was evident this month when netflix secured the US rights to the FIFA Women's World Cup in 2027 and 2031. The streaming giant has been expanding its sports portfolio, much like its peers in the digital and traditional media space.

While consumers are cutting the cord and streaming services are hoarding sports rights, linear TV viewership still significantly outpaces streaming.

“There are still declines in linear TV in many markets, but not all,” said Kate Scott-Dawkins, global president of business intelligence at GroupM, noting that there are international markets that are seeing growth. “When we talk about total television, there is still a lot of opportunity and hopefully a renewed appreciation of how effective it can be as a medium. [for advertisers]”.

Amy Leifer, director of advertising sales at DirecTV Advertising, said the company predicts continued growth in spending on programmatic advertising, or automated digital ad buying, in streaming.

“Despite the shift to streaming, linear TV still has a significant advantage in terms of advertising impressions, generating six times more than streaming,” Leifer said.

Executives said they have been talking to advertisers about how to consider online and streaming together when spending advertising dollars.

Leifer said DirecTV Advertising's mantra is that “TV is TV,” regardless of the distribution method. “Our goal for 2025 is to unify digital and linear television advertising by taking a comprehensive approach and developing convergent television solutions,” he added.

Both NBCUniversal's Marshall and Disney's Mattison said advertisers tended to focus on “linear versus” streaming. That is no longer the case.

“The tone [we made to advertisers] last year is that you can't really compare one to the other. When implemented on a platform, this is what digital and linear look like together. That's made a big difference,” Marshall said, noting that older audiences are more present on linear television, while younger generations have gravitated toward streaming.

Marshall said NBCUniversal's Peacock “has not been cannibalizing linearly,” because there is little overlap between the content of both distribution outlets. “They're really two different audiences,” Marshall said.

Mattison noted that Disney's extensive sports portfolio and its various linear and streaming platforms, with television networks such as ABC and ESPN, and the ESPN+ streaming service, which adds content to Disney+, have been an advantage.

“The convergence [of the streaming apps] “It's really good for consumers, which creates growth for advertisers,” he said. “We are fortunate to have spent years developing our streaming advertising technology and are able to maximize audience reach, targeting and performance.”

“Maybe a few years ago it was linear versus streaming. I think now it's linear AND streaming,” Mattison continued. “They kind of plan together. It's true on both the media side and the advertiser side.”

Disclosure: Comcast owns NBCUniversal, parent of CNBC. NBCUniversal owns NBC Sports and NBC Olympics. NBC Olympics holds the U.S. broadcast rights to all Summer and Winter Games through 2032.