ITV reports a £20 million hit from UK junk food advertising regulations in H1 2026 as the regulatory process for Sky's acquisition of ITV's Media and Entertainment arm gets underway
ITV has reported its first-half 2026 results, revealing that government regulations on junk food advertising introduced in October 2025 caused a £20 million ($26 million) reduction in advertising revenue during the period. Total group revenue held steady at £1.9 billion, and adjusted EBITA (Earnings Before Interest, Taxes, and Amortisation, a measure of operating profitability) was marginally up at £145 million compared with £142 million in H1 2025, though well below the £212 million recorded in H1 2024. The results are the first published since ITV confirmed it is selling its Media and Entertainment arm to Sky, which is owned by Comcast. The production business, ITV Studios, is to be spun off as a separately listed independent company. ITV CEO Carolyn McCall confirmed the regulatory process for the Sky acquisition is underway and that the UK culture minister is expected to scrutinise it closely. ITV's streaming platform ITVX, identified as the primary driver of Sky's interest in the acquisition, recorded 27% growth in viewing during the half-year, with advertising revenue on the platform rising 13% year-on-year. Despite these figures, ITV warned that total advertising revenue is likely to fall by 5% in the following quarter, citing macroeconomic headwinds. Total advertising revenue grew by 8% year-on-year in H1, with the 2026 FIFA World Cup cited as a driver of strong advertising and sponsorship demand. ITV Studios EBITA dropped 9% to £97 million, attributed to the phasing of content deliveries to streaming platforms.
Why this matters
The ITV results create two distinct regulatory storylines for commercial lawyers. First, the £20 million advertising revenue impact from junk food advertising rules illustrates how UK content regulations translate directly into commercial losses for broadcasters, a dynamic that generates contract renegotiation mandates, advertising law advice, and potential regulatory challenge work. Second, the Sky acquisition of ITV's Media and Entertainment arm is now in formal regulatory review, with the culture minister signalled as an active participant: media merger reviews in the UK engage both competition law assessment and public interest considerations under the broadcasting regulatory framework, requiring coordinated advice from competition, media, and corporate teams. The planned spin-off of ITV Studios as a separately listed company adds a capital markets and corporate governance dimension to the transaction, activating a third practice area.
On the Ground
A trainee supporting the regulatory review of the Sky and ITV transaction would assist with drafting the regulatory notification submission to the relevant authority, prepare a compliance gap analysis memo identifying the public interest criteria applicable to media mergers, and update the remediation tracker as the culture minister's review progresses.
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“What regulatory approvals would Sky's acquisition of ITV's Media and Entertainment arm require, and why might the culture minister's involvement complicate or extend the review process?”
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