Sky has announced an operating loss of £224 million ($290.3 million) for the 2023 calendar year, more than double its £111 million loss in 2022.
This increase in losses occurred despite a slight revenue boost to £10.45 billion, driven largely by direct-to-consumer price hikes that raised revenue to £8.5 billion.
Sky attributes the losses to "cord-cutting" as more consumers move from traditional cable packages to OTT streaming services amid rising living costs. Increased production costs—mainly due to expanded Premier League coverage to accommodate the mid-season 2022 FIFA World Cup—also impacted finances.
The UK’s growing streaming market, with sports platforms like DAZN and upcoming Warner Bros. Discovery’s Max, has arguably further diluted Sky’s market share.
Yet Michael Broughton, Co-Founder of Sports Investment Partners, suggests that it may be misplaced to blame the broadcaster’s challenges solely on sports:
What he says:
“I see plenty pointing their fingers at Sky's losses to sports. I have a different view on this.
Spend in sports is up(but that was more due to timing of World Cup than underlying cost increases - which as we know is likely going down in real terms due to nature of next EPL deal.
Losses are up from what we can tell by increased churn... yet one of the main tools to slow the rate of churn is? Sports content.
Sports have sometimes even been loss leaders in order to ensure the rest of the business survives - think BT coming in back when their main problem was churn of a different type, with all those people disconnecting landlines and a need to keep those customers as content/broadband subscribers.
I noted some analysts fear Sky has a problem in 2026 when WBD launch Max in the UK, but the loss of the NBA (yes a prime sports content item) may well hasten the demise of WBD and make their archive available for consolidation.
Sports has to adapt the model, Sky has to adopt the model. That I don't think is really up for debate, but I certainly wouldn't be blaming sports for increased losses.”
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