Philippines’ largest broadcasting company GMA Network Inc. reported a significant drop in its profits for the first nine months of 2024, citing declining advertising revenues as viewers shift to digital platforms.
The network recorded a 43% decrease in net income, falling to P1.41 billion from P2.47 billion during the same period last year. Revenues also declined by 10%, reaching P12.46 billion, driven primarily by a downturn in airtime advertising revenues.
Advertising earnings, which make up 90% of GMA Network’s revenues, dropped by 9%, from P12.68 billion to P11.52 billion year-on-year. This reflects a broader trend of declining ad placements on free TV as audience behavior continues to evolve.
GMA Network attributed the revenue slump to the changing landscape of media consumption, with advertisers redirecting budgets towards digital platforms to reach their target audiences.
“Airtime revenues remained challenged with the changing landscape in our viewer and advertiser behavior as major factors to the drag. With this, the company has ensured that it is keeping pace with these developments and it has continuously made progress in positioning itself in the digital and online arena,” GMA said in its financial report.
To offset the decline in traditional advertising, GMA Network has accelerated its digital transformation. The network reported a 6% growth in online revenues, bolstered by increasing viewership on its digital channels, including Kapuso Stream.
GMA Pictures also launched a dedicated YouTube channel, allowing the network to showcase its films to a wider online audience.
Despite lower revenues, GMA Network’s total expenses rose slightly by 1% to P10.68 billion. General and administrative expenses climbed by 5% to P4.78 billion, attributed to higher spending on production facilities, services, and licenses as the network ramped up its content production.
Production and sales costs were trimmed to mitigate financial challenges, but the network acknowledged the need for ongoing cost management as it adapts to market shifts.
GMA Network said it remains committed to adapting to the evolving media landscape by investing in digital platforms and exploring new revenue streams. The network plans to strengthen its online presence to capture the growing digital audience while sustaining its traditional TV business.
This pivot comes as GMA Network grapples with the broader challenges faced by traditional broadcasters globally, including shifting consumer habits and competition from streaming services.
