A new analysis from S&P Global Ratings says U.S. advertising remains robust, despite what it says are growing concerns about the financial health of U.S. consumers.
“We attribute this strength to consumers continuing to spend despite their perceived fears about the U.S. economy, the emergence of cross-border advertisers, in particular those based in China who have spent robustly in the U.S. and Europe, and the entrance of new e-commerce advertisers,” the report says.
The ratings agency offered its commentary in the newly released “U.S. Media And Entertainment: Looking For The Winds Of Change In 2025,” which previews key trends affecting the U.S. media and entertainment industry.
S&P Global Ratings sees overall advertising in the U.S. expanding 4.3% in 2025. The gains are expected to be led by sports programming and next-generation streaming.
And despite recently expressed enthusiasm for the prospect of more M&A in 2025, S&P isn’t so optimistic, saying differences in perceived value and a lack of capital — as well the need for Congressional action that may not happen — threaten that sense of optimism held by those who are hoping for relaxed FCC rules on ownership and national coverage that might act as a catalyst for industry consolidation.
“In addition,” S&P said, “we expect the incoming Trump Administration to be more supportive of M&A activity. In particular, this could increase the potential for spinoffs of media assets that are in secular decline (such as cable networks) and for mergers among legacy media and entertainment companies.”
Meanwhile, S&P says the divide between legacy media platforms and their digital counterparts is growing wider. Legacy media (excluding Outdoor) is expected to see more mid-single-digit-percentage declines, while search, social, retail media, connected TVs, and streaming will grow at double-digit percentage rates. They’ll also expand their share of ad spending. National TV, local TV and radio, meanwhile, will see declines — with local outperforming national.
“National TV’s headline numbers will reflect mid-single-digit organic declines as well as the impact of a non-Olympics year,” S&P says. “And local TV will face the loss of what has been record political advertising spending this year.”