ITV to Cut Show Budgets as UK TV and Film Production Spending Falls by More Than £2bn

ITV plans to reduce its programming expenditure as the UK Television and film production industry faces a sharp decline in investment. The broadcaster has announced £30 million in temporary cost savings, including £25 million from content spending, as weaker advertising demand and industry-wide financial pressures affect traditional media companies.

The announcement comes as new provisional figures from the British Film Institute (BFI) show that spending on film and high-end television production in the UK fell by £2.08 billion year on year. The decline highlights the challenges facing production companies, broadcasters and streaming platforms amid changing audience habits and increasing international competition.

Key Highlights

• ITV plans £30 million in temporary savings, including £25 million in programming and content costs.
• UK spending on film and high-end television production fell to £5.2 billion in the year to September 2026.
• The latest production spending figure represents a 40% decline compared with the same period in 2025.
• ITV expects advertising revenue to fall by 5% to 10% in the final quarter of 2026.
• ITV’s proposed £1.6 billion sale of its television and streaming business to Sky remains subject to regulatory scrutiny.

ITV Announces £30 Million in Temporary Cost Savings

ITV is planning to make £30 million in temporary savings as it responds to weaker advertising conditions and pressure on its operating costs. Of this amount, £25 million will come from content spending, while the remaining £5 million will be saved elsewhere in the business.

The programming reductions are expected to affect mainly smaller external commissions. Some projects are likely to be postponed until 2027 rather than cancelled permanently. This approach would allow ITV to manage its immediate costs while retaining the possibility of commissioning additional programmes when market conditions improve.

ITV has indicated that the proposed savings will not involve staff reductions. The decision comes at a difficult time for the wider British television industry, where broadcasters are facing weaker commercial revenues, fewer commissions and job cuts.

UK Film and High-End TV Production Spending Drops 40%

The BFI’s latest provisional figures reveal a significant reduction in investment in UK film and high-end television production. Total spending by domestic and international broadcasters, Hollywood studios and streaming platforms reached £5.2 billion in the 12 months to the end of September 2026.

This represents a fall of approximately 40% from the £7.26 billion recorded during the corresponding period in 2025. In monetary terms, production spending declined by £2.08 billion, indicating a substantial slowdown compared with the previous year’s record activity.

The comparison is particularly notable because 2025 included major productions such as Avengers: Doomsday, Spider-Man: Brand New Day and the first instalment of the Harry Potter television series. These large-scale projects contributed to the unusually high production spending recorded during that period.

The BFI’s figures cover films and high-end television programmes, defined as productions costing at least £1 million per episode. They therefore provide an important indication of the level of investment coming into Britain’s film and premium television production sector.

BFI Warns of a Complex Global Production Environment

The BFI has cautioned against viewing the decline as the result of a single factor. A spokesperson said the figures reflected changes in the global entertainment industry, stronger competition from other international production locations and the unusually strong performance recorded in 2025.

Production companies increasingly compete internationally for investment, filming locations and major projects. Countries offering attractive production environments and incentives can influence where studios and streaming platforms choose to make their programmes and films.

There is also an important qualification regarding the latest figures. The BFI classifies the current numbers as “first reported” because production spending data is updated as more information becomes available. The organisation said the final spending figure for 2025 was revised upwards by £900 million compared with its initial reported level.

Consequently, the £5.2 billion figure for 2026 could also increase as further information is collected. However, the current provisional data still points to a substantial reduction in production investment compared with the previous year.

ITV Faces Weak Advertising Demand

ITV’s cost-saving announcement also reflects pressure on its advertising business. The broadcaster expects advertising revenue to decline by between 5% and 10% in the final quarter of 2026, even though the Christmas period is traditionally an important time for television advertising.

For the full year, ITV expects advertising sales to fall by between 2% and 3%. Chief Executive Carolyn McCall attributed the weaker demand to continuing macroeconomic uncertainty and increased digital advertising activity on global streaming platforms.

McCall also highlighted the impact of new advertising restrictions introduced during the year. These rules imposed a 9pm watershed on television advertising for less healthy food, limiting the opportunities for certain products to appear in advertising slots before that time.

The shift towards digital platforms has created additional competition for traditional broadcasters. Companies such as Netflix and YouTube attract audiences and advertising spending that previously supported conventional television networks.

ITV Shares Decline Amid Business Uncertainty

ITV shares fell almost 4% during Wednesday’s trading on the London Stock Exchange. The broadcaster’s market value has also declined by approximately one-fifth since the beginning of the year, reflecting investor concerns about its advertising outlook and the broader media environment.

Weak advertising demand, reduced content spending and uncertainty surrounding the company’s proposed business sale have contributed to the challenges facing ITV. Investors are also assessing how the remaining business could perform after the planned transaction is completed.

The broadcaster’s financial position is closely connected to developments across the television industry. Traditional media companies are having to adapt to changing viewing habits, competition from international streaming services and the rising importance of digital advertising.

ITV-Sky Deal Faces Regulatory Investigation

ITV has agreed to sell its television and streaming business to Sky in a deal valued at £1.6 billion. Chief Executive Carolyn McCall has described the transaction as an important route for ITV’s future as the company seeks to respond to structural changes in the media industry.

However, the proposed acquisition is facing regulatory scrutiny. Culture Secretary Lisa Nandy recently issued a public interest intervention notice, triggering investigations by media regulator Ofcom and the Competition and Markets Authority.

One of the concerns raised by Nandy relates to the combined company’s influence over television news and current affairs. The two businesses together could account for approximately 86% of linear news and current affairs viewing in Britain, according to the concerns outlined by the culture secretary.

There are also questions about potential US political influence on editorial independence because Sky is owned by Comcast, the US-based media company. The regulatory review will examine the relevant public interest issues before the proposed transaction can proceed.

ITV said on Wednesday that the deal was progressing as planned and remained expected to complete in the second half of 2027. However, completion remains subject to the necessary regulatory processes.

ITV Studios Remains a Key Part of the Business

After the proposed sale, ITV will retain its studios business, which produces television programmes for ITV as well as other broadcasters and streaming platforms. This division will become central to the company’s operations following the separation of its television and streaming business.

ITV told investors that studios revenue declined by 1% during the first nine months of the year. Despite the modest reduction, the division continued to demonstrate its ability to produce popular programmes for different platforms.

During the third quarter of 2026, ITV Studios produced five of the UK’s 10 most-watched dramas. These included The Gentlemen for Netflix and The Blame for ITV, highlighting the importance of its relationships with both traditional broadcasters and streaming services.

The studios division’s performance will be important as ITV prepares for its next phase. Producing content for multiple platforms gives the business access to a wider range of potential customers, although it remains exposed to changes in commissioning budgets and production investment.

Pressure Spreads Across the UK Broadcasting Industry

ITV’s financial measures reflect wider difficulties across Britain’s television sector. The BBC is planning to reduce its workforce by as many as 2,000 jobs, while Channel 4 is also planning layoffs as broadcasters attempt to manage financial pressures.

Traditional television companies face competition from streaming platforms, online video services and digital advertising businesses. These changes have affected audience viewing patterns and increased the pressure on broadcasters to control spending while continuing to produce programmes that attract viewers.

The latest BFI figures add another concern for the production industry. A significant decline in spending by broadcasters, studios and streaming companies can affect production schedules, commissioning opportunities and demand for skilled workers across the sector.

What the Latest Developments Mean for UK Television

The combination of lower production spending and weaker advertising revenue presents a difficult environment for Britain’s television industry. ITV’s decision to postpone some commissions and introduce temporary savings demonstrates how broadcasters are adjusting their budgets to changing market conditions.

However, the BFI’s provisional figures may be revised as additional production data becomes available. The final scale of the decline will therefore become clearer over the coming months.

For ITV, the next major developments will include the performance of its advertising business, the management of its content costs and progress on the proposed sale to Sky. Its studios division will also play an important role in determining the company’s position after the transaction.

Conclusion

ITV’s planned £30 million in temporary savings comes as UK film and high-end television production spending faces a reported £2.08 billion annual decline. Weak advertising demand, international competition and changes in viewing habits are creating pressure across the broadcasting industry.

Although ITV expects its proposed sale to Sky to move forward towards completion in the second half of 2027, regulatory scrutiny remains an important factor. Meanwhile, the performance of ITV Studios and the eventual recovery of production investment will be key developments to watch as the UK television sector adapts to a changing media landscape.