JioStar cuts sports rights loss provision 31% in FY26 amid monetisation push

JioStar India has reduced its provision for onerous sports contracts by 31.12% to ₹17,742 crore in FY26, signalling improved commercial performance from its sports business and easing pressure from one of the largest sports rights commitments in the Indian media industry.

According to the company's latest annual report released on Thursday, the reduction follows a sharp increase in provisions during FY25, when JioStar more than doubled the expected loss buffer on sports rights contracts to ₹25,760 crore from ₹12,319 crore in FY24. The latest decline reflects both utilisation of previously created provisions and improving economics around sports broadcasting and streaming operations.

The company utilised ₹8,018 crore from the provision pool during FY26 and, notably, did not create any significant fresh provision for sports-related contracts during the year, indicating that the anticipated losses from its sports rights portfolio have moderated compared with previous assessments.

The development comes at a time when JioStar is seeking to maximise returns from its massive investments in premium sports properties, including cricket rights that have historically weighed heavily on profitability despite delivering record viewership.

Sports rights burden begins to ease

The onerous contract provision primarily relates to sports broadcasting agreements where the expected revenue generation is projected to be lower than the total contractual cost. Accounting standards require companies to recognise such anticipated future losses through provisions on their balance sheets.

JioStar said certain sports event contracts continue to be classified as onerous because projected customer revenues remain below the costs associated with those events. However, the absence of additional provisioning during FY26 suggests the company has become more confident about its ability to monetise sports properties through advertising, subscriptions and emerging commerce-led revenue streams.

Industry executives view the reduction as an early indication that the merged entity is beginning to extract operational synergies from its combined television and digital ecosystem, particularly following the integration of Disney Star and Viacom18.

The provisions are understood to be linked largely to the International Cricket Council (ICC) media rights package acquired for approximately $3 billion for the 2023–27 cycle. The acquisition has been among the most expensive sports rights deals in global cricket broadcasting and has drawn scrutiny over its financial viability.

The economics of the ICC rights package have reportedly been a point of contention between JioStar and the global cricket body. Last year, the broadcaster is understood to have approached the ICC seeking relief from certain obligations under the agreement, although it remains contractually bound to honour the deal through the current rights cycle.

Full-year operations show commercial momentum

FY26 marked the first full financial year of operations for JioStar following the merger of Disney Star and Viacom18. While direct year-on-year comparisons remain difficult because FY25 represented a shortened reporting period from November 14, 2024, to March 31, 2025, industry analysts said the latest financial performance points to significant commercial momentum.

JioStar reported operating revenue of ₹31,048 crore during FY26, while gross revenue stood at ₹36,248 crore. The company posted a net profit of ₹3,210 crore and earnings before interest, tax, depreciation and amortisation (EBITDA) of ₹4,855 crore.

The financial performance assumes significance given the challenging advertising environment for traditional television broadcasters. While linear TV advertising remained under pressure, growth in digital advertising and strong sports consumption helped offset weakness in the conventional broadcasting business.

Analysts note that the company's profitability demonstrates the scale advantages emerging from the consolidation of India's largest television network with one of the country's fastest-growing digital streaming platforms.

JioStar scales user engagement

JioStar's digital platform, JioHotstar, emerged as a key growth driver during FY26. The streaming service averaged approximately 550 million monthly active users by March 2026, underlining its position as one of the world's largest streaming platforms by audience reach.

The company said its strategic focus during the year centred on improving monetisation and platform excellence. To achieve this, JioHotstar revamped its content discovery and personalisation systems to enhance recommendation accuracy, audience segmentation and advertising effectiveness.

Management indicated that investments in artificial intelligence have become central to the platform's growth strategy, helping improve user engagement while creating new opportunities for advertisers and commerce partners.

AI and commerce become central to growth strategy

The annual report highlights JioStar's increasing emphasis on integrating commerce with entertainment content. During IPL 2026, the company expanded its commerce-led entertainment strategy through AI-powered content discovery, interactive engagement features and integrated in-app ordering experiences.

Reliance said these initiatives are part of broader investments in artificial intelligence across the media value chain. The company also disclosed the launch of conversational content discovery capabilities through a strategic partnership with OpenAI, aimed at transforming how users search for and discover content across the platform.

The move reflects a wider industry trend in which streaming companies are deploying AI to improve content recommendations, reduce customer acquisition costs and deepen engagement across increasingly fragmented audiences.

Focus shifts from scale to profitability

The reduction in sports-related provisions may also indicate a strategic shift in India's media sector, where broadcasters are increasingly focused on profitability and monetisation rather than pure audience scale.

For JioStar, which controls an unmatched portfolio of television channels, streaming assets and premium sports rights, the challenge has been converting record-breaking viewership into sustainable financial returns.

The FY26 numbers suggest that the company is making progress on that front. Improved monetisation of sports properties, growing digital advertising revenue, enhanced platform capabilities and tighter cost management appear to have helped reduce the financial burden associated with expensive sports rights commitments.

Even so, the remaining provision of ₹17,742 crore underscores the scale of the obligations still embedded within JioStar's sports rights portfolio. How effectively the company monetises marquee properties such as ICC tournaments over the remaining rights cycle will remain a key indicator of the long-term success of India's largest media and entertainment merger.