Astro Malaysia Holdings Bhd is expected to face weaker advertising revenue and increased subscriber pressure following its decision not to acquire the broadcasting rights for the FIFA World Cup 2026, marking the end of its more than 20-year tenure as Malaysia’s primary World Cup broadcaster, according to Kenanga Research.
In a sector report, the research house said the tournament represents a “decisive structural shift” for Malaysia’s pay-TV industry, with Radio Televisyen Malaysia (RTM) and Telekom Malaysia Bhd’s Unifi TV emerging as the official broadcasters for all 104 World Cup matches.
RTM will broadcast the majority of matches either live or on a delayed basis, while Unifi TV will provide comprehensive live coverage of every fixture through its subscription-based platform.
Astro has attributed its decision to forgo the tournament to escalating broadcasting rights costs, widespread content piracy and declining commercial viability.
Advertising impact expected
Kenanga said the development is likely to reshape Malaysia’s advertising expenditure (adex) landscape in 2026, with Astro expected to lose the advertising revenue boost typically associated with football’s biggest tournament.
The research house also expects industry advertising expenditure, as measured by Nielsen, to appear weaker as Unifi TV’s monetisation strategy relies primarily on subscription fees rather than advertising sales.
Unifi TV has priced its World Cup package at RM60 for a full tournament pass, RM50 for existing subscribers and RM20 for a daily pass.
Subscriber retention concerns
While Astro is expected to save approximately RM163 million in content acquisition costs after excluding the World Cup rights from its forecasts, Kenanga believes the savings will be outweighed by the longer-term impact on subscriber retention.
Sports programming remains one of Astro’s strongest customer retention drivers, with sports package subscribers accounting for roughly 30 per cent of its customer base.
The absence of World Cup coverage is expected to weaken the appeal of Astro’s sports offering and could result in subscriber attrition over the coming quarters.
Astro Shaw seen as long-term growth driver
Despite the challenges facing its traditional pay-TV business, Kenanga views Astro Shaw’s intellectual property (IP) strategy as the group’s most credible long-term earnings diversification initiative.
The research house highlighted the Astro Shaw Cinematic Universe (ASCU), Malaysia’s first shared cinematic universe inspired by Hollywood’s Marvel Cinematic Universe, as a strategic platform to develop interconnected local film franchises.
The ASCU links established titles such as Polis Evo, Projek: High Council and Keluang Man, with multiple films planned before culminating in a larger crossover project targeted for 2028.
Upcoming productions include REZA, a spin-off from the Polis Evo franchise scheduled for 2026, Polis Evo 4, six planned Keluang Man films and a new mythological action film titled Baling.
Strong box office momentum
Kenanga noted that Astro Shaw has produced five of Malaysia’s 10 highest-grossing local films of all time.
In FY2026, six of the country’s top 10 highest-grossing local films were Astro Shaw productions, generating a combined box office collection of RM111 million.
The production house has also recorded encouraging momentum this year.
Malaikat Malam, released in March, collected RM14 million at the box office and outperformed the international blockbuster Project Hail Mary during its opening week.
Meanwhile, Tarung: Unforgiven, released in May, generated RM23 million in gross box office receipts and topped Malaysia’s cinema charts for two consecutive weeks.
Kenanga also expects Astro Shaw to announce more regional collaborations with studios and investors in Indonesia and Thailand during the second half of 2026, potentially expanding the distribution reach of its film portfolio.
IP monetisation still in early stages
However, the research house cautioned that meaningful earnings contributions from Astro’s IP strategy remain some way off.
It noted that films where Astro mainly serves as distributor and marketing partner typically allow the group to retain only around 15 per cent of gross box office revenue.
Returns are substantially higher for productions where Astro owns the intellectual property, such as the Polis Evo franchise, where it can retain up to 90 per cent of box office receipts.
Even so, pay-TV subscription revenue continues to dominate Astro’s financial performance, contributing approximately 90 per cent of FY2026 revenue.
Underweight maintained
Kenanga maintained its Underweight recommendation on the media sector and kept its 2026 advertising expenditure forecast unchanged at RM4.24 billion, representing a 9.5 per cent year-on-year decline.
The research house said traditional media companies continue to face structural challenges from the migration of advertising budgets to digital platforms, the loss of premium sports content, and the high fixed costs associated with legacy broadcasting infrastructure such as satellite transponders, transmission towers and print distribution networks.
While Astro’s IP expansion strategy offers a promising long-term growth avenue, Kenanga believes its contribution to earnings will remain limited in the near term and currently has no preferred stock picks in the sector.
