Political spending for the 2025 May midterm elections and fueled by their investments in digital assets would lead to an expected rebound for media companies.
Globalinks Securities and Stocks Inc. sales Toby Allan Arce told Business World that “the continued growth in online platforms and content consumption allows media companies to reach younger, tech-savvy audiences and so with investments in digital assets that could drive long-term growth.”
Political advertising would also surge in time for the May elections, he noted.
“Political coverage and election-related programming often leads to higher viewership and engagement,” he added.
Economists such as RCBC chief economist Michael Ricafort also foresee that the midterm elections “would lead to election-related spending on advertisements for various candidates, in all forms of media.”
The prevalence of social media has proved to be a challenge faced by the country’s two largest media conglomerates in the past years.
For the first nine months of 2024, ABS-CBN Corp. trimmed its attributable net loss to P2.41 billion from a loss of P3.15 billion in the same period a year earlier.
ABS-CBN recorded a 10.4 percent drop in consolidated revenue for the period to P12.12 billion due to lower cable TV and broadband revenues.
GMA Network, Inc.’s attributable net income for the January-to-September period in 2024 declined to P1.41 billion, marking a decrease of 42.9 percent from the P2.47 billion previously.
The company saw its gross revenue fall by 9.5 percent to P12.46 billion for the first nine months of 2024 from P13.77 billion in the comparable period a year ago.
Only last week, shares of ABS-CBN surged after a bill seeking to grant the media company a franchise was filed in the House of Representatives.
On Friday, shares in the company closed 2.23 percent higher at P5.97 each. The company’s shares traded as high as P6.15 apiece intraday.
BDO Capital and Investment Corp. President Eduardo Francisco said the filing of the bill to grant ABS-CBN a franchise would be good for the company’s stock price.
“But I defer to regulators on requirements for renewal and if ABS-CBN still meets it as they are now much smaller in viewership and offerings,” Francisco added.
However, Arce noted that the shifting consumer preference toward digital and streaming platforms could pose a significant challenge to media companies’ growth.
“Companies that adapt to digital ad platforms may thrive, while those relying on traditional TV ads could face challenges. The need for high-quality, localized, and engaging content will grow, requiring significant investments,” he said.
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