Political Spending Lifts 2026 Local Ad Market To $186.1 Billion.

BIA Advisory Services has raised its forecast for the 2026 U.S. local advertising market to $186.1 billion, up $1.6 billion, or 0.9%, from its April estimate. The new projection represents approximately 9% growth from 2025, with stronger-than-expected political spending ahead of the midterm elections and continued mobile growth driving the increase.

Excluding political advertising, BIA now expects the local advertising market to reach $176.4 billion this year, up 0.2% from its previous forecast and 3.9% from 2025.

“Political spending came in higher than we anticipated in April, with most of the incremental spending flowing into TV OTA and TV OTT,” said BIA VP of Forecasting and Data Analysis Senan Mele.

BIA now projects $9.7 billion in local political advertising for 2026, up from its April forecast of $8.4 billion. TV OTA and TV OTT are expected to capture $1.2 billion of the $1.3 billion increase, underscoring the continued role of broadcast and streaming video in political campaigns.

Legal Services was another notable growth category in the latest forecast. BIA expects the sector to generate $9.3 billion in local advertising this year, 4.6% above its April projection.

“Despite higher media costs and a more fragmented media environment, law firms continue to invest heavily in television, both linear and streaming, where the ability to reach large audiences and generate qualified leads continues to drive demand,” Mele said.

Mobile remains the largest local media category tracked by BIA. Excluding political advertising, the firm projects mobile revenue will reach $45.3 billion in 2026, an 8.9% increase from 2025.

At the same time, artificial intelligence is creating a new competitive dynamic around search advertising, an area that has traditionally been important to local advertisers seeking consumers on mobile devices.

“Google, OpenAI, Amazon, and Apple are all positioning themselves to capture a larger share of advertising tied to AI-powered search,” said Mike Boland, Executive in Residence at BIA Advisory Services. He said Google’s Gemini is increasingly becoming an extension of its advertising business, while OpenAI, Amazon and Apple are developing their own approaches to search and discovery monetization.

“For local advertisers, the bigger question is where consumer intent will emerge and which platforms will capture it,” Boland said. “Mobile will be a critical battleground as that shift unfolds.”

BIA’s first look at 2027 projects total local advertising revenue of $186.5 billion, essentially flat vs. 2026. The forecast anticipates roughly $9 billion in underlying nonpolitical growth offsetting an $8.6 billion decline in political advertising as the election cycle ends. Political spending is projected to fall to approximately $1.1 billion in the 2027 off-cycle year.

“Political spending will decline sharply after the midterms, but the underlying nonpolitical market has continued to grow and should offset much of that decline,” Mele said. “We expect the overall local advertising market to remain essentially flat in 2027, with continued growth across core categories helping to support the market in an off-cycle year.”

Several categories are projected to outperform the overall market in 2027. Real estate leads with 9.8% projected growth, followed by leisure and recreation at 5.9%, automotive at 5.1%, restaurants and food at 4.4%, and financial services at 3.7%.

“2027 makes clear that the underlying growth in local advertising is broader and more durable than the political cycle alone would suggest,” said BIA Managing Director Rick Ducey. “Political spending has accelerated the market and delivered a strong two-year period for broadcast and streaming video, but the more important story is what happens beneath that surge.”

Ducey said core advertising categories continue to expand their investments across an increasingly diverse media ecosystem, with sustained, multi-platform demand expected to shape the next phase of local media.