Malaysia adex growth continues to favour digital as traditional media face ongoing pressure

Kuala Lumpur, Malaysia – Advertisers in Malaysia are continuing to shift budgets toward digital channels, supported by higher social media engagement and increased adoption of programmatic, data-driven advertising across search platforms, according to a research note by Kenanga Research. The firm noted that this trend has resulted in legacy media steadily losing market share, with no near-term reversal expected.

Citing MAGNA data, Kenanga Research said Malaysia’s total advertising expenditure (adex) is forecast to grow 6.4% year-on-year in 2025 to RM9.54b. However, this growth is expected to be driven entirely by digital formats, particularly social media and search advertising, while traditional channels continue to decline.

MAGNA estimates that digital media accounted for 77% of total Malaysian adex in 2024, led by social media at 41%, search at 24%, and other digital channels at 12%. Looking ahead, digital adex is projected to expand further, with social media expected to grow 11% and search advertising 8% in 2025. These gains are anticipated to offset declines in television (–3%), print (–7%), and radio (–6%). By 2029, MAGNA forecasts digital media will command 85% of total adex, while television’s share is expected to narrow to 5%.

Kenanga Research attributed digital media’s continued momentum to its reach, engagement, and targeting capabilities. Social platforms allow brands to deliver personalised and interactive content, while search advertising captures high-intent demand at the point of purchase. The firm also highlighted the role of AI-driven programmatic tools and real-time analytics in improving campaign optimisation and return on investment.

The research note added that traditional media operators in Malaysia have made limited progress in digital advertising. Monetisation efforts have largely been confined to lower-value display and embedded video placements on owned websites, leaving a gap versus digital-native players such as FOODIE.

Kenanga Research pointed to Media Prima Group’s digital arm, REV Media Group, as having made relatively more progress, supported by a digital audience of 140m social media followers and 3.5b video views. However, digital adex contributed only 11% of Media Prima Group’s 1QFY26 revenue. Astro’s recently launched digital marketing venture, KULT, was also cited as a strategic move to re-engage digital-first advertisers, though digital adex currently accounts for just 2% of Astro’s total adex in 9MFY26.

The firm reiterated its FY25 adex forecast of RM4.86b, representing a 20% year-on-year decline. This outlook reflects contraction across free-to-air TV (–17%), web-based digital media (–35%), newspapers (–13%), magazines (–13%), and cinema (–40%). Kenanga Research clarified that its digital media definition is limited to website-based inventory, excluding in-app placements.

Kenanga Research maintained its ‘UNDERWEIGHT’ rating on the media sector, citing persistent earnings pressure from competition with digital-native players and high legacy cost structures. While measures such as workforce optimisation, AI-led efficiency initiatives, and selective asset impairments have helped moderate losses, the firm said these have not delivered a sustained turnaround.

According to the research note, a sector re-rating would require more transformative strategies, including mergers and acquisitions, asset divestments, regional expansion, or a decisive pivot toward scalable digital intellectual property ownership. Kenanga Research said it currently has no stock picks within the sector.