ITV’s latest results were not the kind that make traditional broadcasters look glamorous. The British broadcaster’s ad revenue is still under pressure, linear TV is still fading, and profits are still being squeezed by a market that has moved on from the old schedule-led model.

But the company’s real story is no longer just about whether people are watching fewer commercials between soap operas. It is about whether ITV can finally persuade investors that it is becoming something else entirely.

ITV reported broadly flat revenue for 2025, with growth in ITV Studios offsetting weakness in its Media and Entertainment division, which includes its traditional TV channels and streaming platform ITVX. Adjusted pre-tax profit fell 5% to £448 million (about $600 million), while statutory pre-tax profit dropped much more sharply, though that was distorted by a tougher comparison against the previous year, which included a one-off gain from the sale of BritBox International.

The weak spot remained advertising. Total advertising revenue fell by £97 million over the year, and management warned that first-quarter ad revenue in 2026 is likely to fall another 2 % as clients hold spending back ahead of the men’s World Cup later in the year. In plain English, the TV ad market remains soft, timing is awkward, and ITV is still operating in a business where visibility can vanish the moment marketers get nervous.

That weakness in broadcasting was partly offset by ITV Studios, whose revenue rose 5 %. The production arm remains the crown jewel of the group, churning out content like Love Island and selling programming into a market that increasingly values intellectual property more than channels. Management also pointed to continued momentum at ITVX, where digital advertising has grown faster than expected and streaming performance has outpaced some rivals.

Hovering over all of this is Sky.

ITV confirmed that talks are still ongoing over a possible sale of its Media and Entertainment business in a deal that could be worth around £1.6 billion. The company stressed there is no certainty a transaction will happen, but the market has clearly decided this is the bit that matters. ITV shares have rallied in recent months largely on the idea that a sale could unlock value and leave investors holding a much cleaner studios-led story.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here.

This is where ITV gets interesting, because the company is stuck between two realities. In one, it is still the old broadcaster everyone knows, reliant on a shrinking TV ad market and forever being compared with slicker global streamers. In the other, it is trying to become a more digital, more flexible content business with a production arm that looks far more attractive than the mothership it sits inside.

That tension has defined ITV for years. The market has tended to value it like a tired UK broadcaster, which is not exactly a compliment in an era when investors hear “linear TV” and immediately reach for the nearest discount rate. But ITV has been trying to argue that it deserves something better because more of its revenue now comes from studios and digital. Those businesses are not immune from pressure, but they are clearly more durable than the old model of selling big chunks of ad space around Saturday night entertainment.

The possible Sky deal matters because it could force the market to stop squinting and finally see the company in pieces rather than as one lumpy, unloved whole. A sale of the Media and Entertainment arm would effectively separate the fading cash-generative broadcast business from the higher-growth production business. That could be strategically neat for ITV and potentially useful for Sky, which wants scale in UK streaming and would love a bigger answer to Netflix, Disney, and Amazon. It would also remove the strange contradiction at the heart of ITV’s equity story, where one decent business is constantly being marked down because it shares a house with a more challenged one.

The risk, of course, is that the deal never happens. And if it does not, ITV is still left proving that ITVX can keep growing, that Studios can keep delivering, and that management can squeeze enough efficiency out of the old business to fund the pivot. That is doable, but it is slower, messier, and far less cinematic than a neat corporate carve-up.

For now, the next chapter is all about whether the Sky talks become something real. If they do, ITV could emerge as a far simpler, more focused studios-and-digital story, and that is the version of the company bulls have been trying to describe for years. If they do not, investors will go back to judging ITV the hard way, by whether it can keep growing digital revenues fast enough to outrun the slow grind of declining broadcast ads.

Either way, the direction of travel is clear. ITV is not really fighting to save old television anymore. It is fighting to make sure it is valued for whatever comes after it.

One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here.