2Q and beyond: revenue diversification, costs maintenance, and rating improvements. In an effort to offset Indonesia’s declining aggregate AdEx, NETV is planning to diversify its business customer partners from conventional consumer companies to SOEs and regional governments which are currently in possession of greater purchasing power to place ads. That said, the management is looking for monthly FTA revenue level to rise to IDR 10-11bn/month in 2Q26, up 13.6% from average monthly revenue of IDR 8.8bn in 1Q26, supported by ‘Istri Paruh Waktu’ series. Additionally, we are quite optimistic on 4Q26 performance due to strong line ups in drama series from the likes of ‘Ipar Adalah Maut’, which delivered strong audience share and high ratings back in 4Q25. The above-mentioned operating developments from potential new partnerships to lucrative series, coupled with effort of minimizing opex at c.IDR 18bn per quarter will result in narrower loss of -IDR 61bn in 2026F, before reaching BEP level in 2027F.

 

1Q26 results: adversely impacted by longer-than-expected rebranding & adaptation. In 1Q26, NETV recorded net revenues of IDR 26.4bn (+46% QoQ, -19% YoY), translating to 13% of our estimate — a miss we attribute to lower-than-expected monetization despite NETV's meaningful improvement in ratings and audience shares. Stemming from improved TV ratings and audience shares, NETV experienced QoQ rebound and stronger ad-spend, driven predominantly by FTA at IDR 24.0bn (+45% QoQ, -23% YoY). However, on YoY basis, performance declined due to seasonality impact of an earlier Ramadan in 2026. On the margin front, NETV booked its first positive gross profit after four consecutive negative quarters at IDR 1.3bn (GPM: +5.0% vs. -238.4% in 4Q25), a meaningful inflection point, though EBIT and EBITDA margins remained negative at -93.8% and -80.5% respectively. Net loss narrowed significantly to IDR 25.5bn (1Q25: -IDR 53.7bn, 4Q25: -IDR 149.0bn), but not yet reaching the break-even point, which we attribute to longer-than-expected transition and adaptation phase into the drama-centric channel business.

 

Continued longer-term operating improvements on the cards: BUY with IDR 100 TP. As  NETV underwent a bold move by shifting its brand focus to drama-centric, 2025 was a year to learn and adapt for the company. Therefore, we lower earnings and take more conservative approach in our valuation (Figure 2), decreasing DCF-based TP to IDR 100/share (from IDR 170).  Nevertheless, we maintain our BUY rating on optimism of NETV’s turnaround, backed by MD Entertainment’s strong IP monetization potential. Risks to our outlook include slower-than-expected ad monetization and unforeseen costs.