Media’s restructure starts with how we consume it

UK media is not in a downturn. It is being restructured, and credit teams should treat it differently.

A downturn is cyclical: demand falls with the economy and comes back when it recovers. A restructure is permanent: customer behaviour has changed, and it only ends when businesses have rebuilt how they make money. Some will not manage it.

For media businesses, which earn their income by selling an audience to advertisers, the change is that they no longer own that audience. People increasingly read and watch through social platforms and search, with AI sitting in between, and the advertising has followed.

When I spoke to Kirsten Tompkins of EY-Parthenon about the Q3 2026 UK profit warnings report, she put the sector’s difficulties down to this shift in how we consume media. I agree, and I think the credit implications are bigger than most risk teams have allowed for. Listed media groups have to tell the market when their model changes. The private companies that depend on them, such as agencies, production companies, printers and ad tech firms, do not, and their filed accounts can lag the damage by more than a year.

Most news now reaches people through someone else’s platform

Ofcom’s 2025 news consumption research found that 70% of UK adults now get news online, ahead of the 63% who use linear TV channels. Six in ten of those online news journeys come through intermediaries such as social media and aggregators rather than directly from the outlet. TikTok alone is used for news by 11% of UK adults, up from 1% in 2020.

The Reuters Institute’s Digital News Report 2026 goes further. For the first time, online video networks have overtaken both TV and news websites as the main source of news in the UK.

The practical consequence is simple. The outlet no longer owns the relationship with its reader. The platform does, and the platform decides how much of that audience the outlet gets to see.

News brands are shrinking in a growing ad market

The advertising money has tracked the audience closely. The Advertising Association and WARC put UK ad investment at £11.7 billion in the first quarter of 2026, up 9.3% on a year earlier. Within that, social media grew 17.7% and search grew 9.8% to £4.6 billion, the largest single channel.

News brands went the other way. National news brand ad revenue fell 3.7% and regional news brands fell 9.7%, with regional online down 12.1%.

That is the clearest sign of a restructure I can point to. The overall market is growing, and the outlets are still shrinking inside it.

AI search is taking the click

AI now sits between the reader and the outlet in a way that social platforms never quite did. When search engines summarise the answer on the results page, the click that used to carry the reader to the publisher, and the advertising impression that came with it, often never happens.

The publishers are saying so directly. DMGT attributed falling traffic to AI overviews in search, with the Daily Mail’s UK digital audience down 14% year on year to 18.1 million in December 2025, according to Ipsos iris. Reach’s chief content officer, David Higgerson, pointed to changes in Google Discover and the arrival of AI Overviews as Reach announced around 220 editorial job cuts, 60 new roles and the closure of Kent Live, Aberdeen Live and Galway Beo. Reach is also replacing page views with active engaged time as its main measure.

What strikes me is how early this still is. The Reuters Institute found that only 4% of Britons use AI chatbots for news each week. Most of the AI effect so far is arriving through search. If chatbot use for news grows the way social media use did, the pressure on outlets has further to run.

What it looks like in a set of results

LBG Media, the owner of LADbible, shows all of this in one business. It issued its second profit warning in under two months in June. Revenue from its own sites and social platforms fell 41% in the first half, pre-tax profit fell 79% to £1.8 million, and direct revenue nearly doubled to £37.6 million. The audience is still there. The money it makes from that audience through platforms has dropped sharply, so the business is moving towards selling to advertisers directly.

The wider economy is not helping. EY-Parthenon’s Q3 2026 report recorded 65 profit warnings, the highest quarterly total since Q4 2024. Jo Robinson, who leads EY-Parthenon’s UK and Ireland restructuring practice, said: “This is not a conventional economic cycle.” She linked AI reshaping competitive positions and routes to market to existential questions about business models.

The risk sits in the supply chain

This is where my concern as a risk professional really lies. The listed groups have to tell the market when their model changes. The private companies built around them do not.

Think about who depends on media outlets for their own revenue: content and creative agencies, independent production companies, printers and distributors, programmatic ad tech firms and regional titles. Add the social first publishers and creator businesses whose income depends on a single platform’s algorithm, where a change in how content is distributed can cut revenue almost overnight.

Private companies in the UK have nine months from their year end to file accounts. By the time a supplier’s filed figures show the damage, the trading that caused it can be well over a year old. In my 35 years in commercial data, I have seen this lag catch out good credit teams time and again.

Four steps for credit teams with media exposure

If I held media exposure in a book today, I would do four things.

1. Segment it by how each business reaches its audience and its advertisers, not by SIC code. A company relying on referral traffic, programmatic advertising or one platform’s algorithm carries a very different risk from one built on subscriptions, events or contracted revenue.
2. Look at the direction of travel, not the level. A balance sheet built in the good years can look healthy while the trading underneath it erodes.
3. Map the suppliers of the listed groups that are restructuring. That is where the second wave of stress will show.
4. Move from annual review to continuous monitoring for anything in the sector.

That last point is the reason we pair the H-Score® with PoD®, our Probability of Distress score, which we launched last week. The H-Score® measures a company’s financial health on a scale of 0 to 100. PoD® puts a probability on distress, and together with ongoing monitoring it lets you see which names in a media portfolio are drifting before a missed payment or an insolvency notice tells you.

The 17.7% growth in social media advertising is a reminder that the money has moved rather than disappeared. Businesses that follow the audience and build a direct relationship with it will come through this. Our job as risk professionals is to tell them apart from the ones that will not, early enough to act.

If you have media exposure and would like to talk through how it looks, I’d welcome a conversation.