STV Group (LON:STVG) shares sank more than 20% on Monday morning after the broadcaster slashed its full-year guidance, blaming worsening macroeconomic conditions and a sharp slowdown in both the advertising and commissioning markets.
The company now expects 2025 revenue to land between £165 million and £180 million, significantly down from the £188 million it reported last year.
Adjusted operating margins are forecast to shrink to 7%, compared to 11% in 2024. The downgrade sent investors fleeing, with STV’s stock marking one of its steepest single-day declines in recent memory.
The latest blow follows a deeper-than-expected contraction in the commissioning pipeline and a softening in advertising revenue, particularly in July, which the company now expects to be down 20%. Third-quarter advertising is forecast to fall 8% overall, with only a modest pickup expected in August and September.
STV Studios, a core growth engine in recent years, is now guiding for revenue of just £75 million to £85 million and a wafer-thin 4% margin, as fixed overheads bite harder amid falling activity volumes. Its order book has slipped to £54 million from £66 million in April.
The newly formed Audience division, which includes STV’s digital and linear platforms, is expected to generate between £90 million and £95 million in 2025, with margins narrowing to 13–15%.
Cost-cutting has been ramped up in response. STV has now identified £2.5 million in annual savings for 2025, with more expected in 2026. Despite the grim outlook, management insists the long-term growth story remains intact. Investors clearly aren’t buying it today.