Despite the immense popularity of generative AI for making tasks easier, it poses challenges for some traditional sectors. A fresh example of this now comes from the image licensing company Getty Images, which is reportedly considering a merger with its biggest rival – Shutterstock. According to a Bloomberg report citing people familiar with the matter, discussions regarding this potential deal are still ongoing. For now, no final decision has been made by either side. However, for now, the speculation has boosted the stock prices of both companies.
The reason behind this surprise move is said to be the rise of AI tools like MidJourney and DALL-E 2. These tools are emerging as cost-saving and quick alternatives for generating unique images. Talking about financials, Getty Images – founded in 1995 – reported annual revenues of $919 million in 2021, $926 million in 2022, and $917 million in 2023. For Q3 2024, the company generated $240.5 million, reflecting a 4.9% year-over-year increase. Despite this growth, Getty Images reported a net loss of $2.5 million in Q3 2024.
Getty is widely recognized as a global supplier of stock images, editorial photography, video, and music for both businesses and consumers. The company works with a network of over 576,000 content creators and more than 340 content partners. With more than 70 exclusive content partners, including Walt Disney and BBC, Getty Images serves clients across the news, entertainment, advertising, and content creation sectors. FIFA, the NCAA, and the PGA Tour are among the exclusive partners of the company.
The company owns brands like Getty Images, iStock, and Unsplash. Getty Images made its public debut in 2021, with a valuation of $4.8 billion at the time. Coming back to the latest development, if it becomes a reality, it will be interesting to see how the two U.S.-based rivals combine their structures.
Talking about Shutterstock, the New York-based company was founded in 2003. It offers a variety of services for businesses, media companies, and brands. The list includes content creation and licensing of 3D models, videos, photographs, illustrations, and along with an AI generator. In 2012, the company completed its IPO (initial public offering). Notably, Shutterstock also acquired Giphy in 2023. In Q3 2024, the firm recorded revenues of $250.6 million – up 7% compared to the same period in the prior year. The company’s total revenue for 2023 stood at $874.6 million.
According to the report, the stock price of Getty Images fell by 56% in the past year, while Shutterstock’s stock price dropped by 37%. However, following merger reports, Getty Images saw a 13% increase, closing at $2.39 in New York trading on Friday. This brings the company’s market value to $983 million. Meanwhile, Shutterstock’s stock price rose by 7.9% to $31.47, bringing its market value to around $1.1 billion.
