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Annual losses doubled at Sky last year after the British media and telecoms group increased investment in its sports programming as well as film and TV production.
The group, which was acquired in 2018 by US media conglomerate Comcast, reported an operating loss of £224mn, widening from a loss of £111mn in 2022, according to accounts filed at Companies House.
Sky is betting on sports coverage to give it a competitive edge in the UK over rival broadcasters and US streaming giants. Last year it secured the rights to show the majority of Premier League football matches for more than £5bn.
Overall, the UK-based group reported flat revenues of £10.2bn in 2023. Its direct-to-consumer business, which includes mobile, broadband and streaming, reported £8.5bn in revenues, 1.5 per cent higher than the year before.
The company said the increase was driven by the continued growth and higher prices of its mobile, broadband and streaming businesses, including Sky Glass, its smart television that comes with a subscription to its channels. This growth was offset by declining sales of its satellite-enabled Sky Q boxes, as the company pivots from satellite to internet streaming. More than three-quarters of Sky customers use its internet services rather than a traditional satellite dish.
Since its acquisition by Comcast, Sky has been accelerating a strategic shift away from satellite to digital services. The resulting restructuring has led to job cuts in the UK, where Sky employs about 27,000 people.
The group also reported a £1.2bn writedown related to its international business after providing significant loans to its subsidiaries in Germany and Italy to keep them operating.
It also logged £3.4bn in programming costs, marginally higher than the year before due to the World Cup disrupting the football season schedule, which led to more matches being played in 2023.
In an interview with the Financial Times late last year, Sky chief executive Dana Strong said the group was cornering the market for exclusive sports coverage in the UK with plans to show as many as 1,200 football matches a year.
Sky faces a renegotiation with Warner Bros Discovery of its 2019 deal to show HBO programming, which is due to expire next year.
Last month Sky accused the studio of violating an agreement that gives it the right to co-produce shows with its Max streaming service, including a new Harry Potter series. WBD said it would defend itself against the suit, adding it “makes it clear that Sky is deeply concerned about the viability of its business were it to lose our award-winning content”.
Sky is investing more than £500mn a year into it original content, which include shows such as Mary & George and Sweetpea.
