Financial Performance - Fourth quarter revenue increased sequentially to $322.8 million, with an operating loss improved to $(4.7) million[1]. - Total revenue for the quarter was $322.8 million, compared to $344.5 million in the prior year[3][11]. - The net loss for the quarter was $(20.7) million, translating to a net loss per share of $(1.24)[3][11]. - The company reported a net loss from continuing operations of $(20.7) million, compared to $(31.8) million in the prior year[3][11]. - For the three months ended December 31, 2025, the net loss from continuing operations was $20.7 million, a decrease from a net loss of $31.8 million in the same period of 2024[13]. - Total cash used in operating activities for continuing operations was $21.4 million for the three months ended December 31, 2025, compared to cash provided of $41.9 million in the same period of 2024[13]. - The company experienced a net change in cash and cash equivalents of $(1.3) million for the three months ended December 31, 2025, compared to $(4.6) million in the same period of 2024[13]. Subscriber Growth - Domestic OTT subscribers grew to an all-time high of 12.7 million, up 890,000 or 7.6% year-over-year, with total U.S. subscribers increasing by 170,000[1][3]. - The total number of U.S. OTT subscribers increased to 12.66 million as of December 31, 2025, up from 11.77 million as of December 31, 2024, representing a growth of 7.6%[24]. - Total U.S. subscribers (OTT and Linear) reached 17.63 million as of December 31, 2025, compared to 17.68 million as of December 31, 2024, indicating a slight decrease of 0.3%[24]. - The total number of Starz Networks subscribers (OTT and Linear) decreased to 17.63 million as of December 31, 2025, from 19.93 million as of December 31, 2024, a decline of 11.5%[24]. Adjusted OIBDA and Financial Metrics - Adjusted OIBDA for the fourth quarter reached $55.5 million, while the annual trailing-twelve month Adjusted OIBDA was $204.0 million[1][3]. - Adjusted OIBDA for the trailing twelve months ended December 31, 2025, was $55.5 million, compared to $204 million for the same period in 2024, reflecting a significant decline[15]. - Management expects to grow Adjusted OIBDA and OTT revenue in 2026, aiming to delever to approximately 2.7x and significantly improve free cash flow[1][2]. - The company ended the quarter with total net debt of $589.4 million and an Adjusted OIBDA Leverage Ratio of 2.9x[3][5]. Operating Expenses - Programming amortization expenses for the quarter were $132.0 million, while total operating expenses were $327.5 million[3][11]. - Programming amortization for the nine months ended December 31, 2025, was $451.3 million, down from $520.4 million in the same period of 2024[13]. - The company reported a total share-based compensation expense of $3.5 million for the three months ended December 31, 2025, compared to $4.1 million in the same period of 2024[21]. Non-GAAP Financial Measures - Starz Entertainment Corp. utilizes non-GAAP financial measures to evaluate its operating performance, including Adjusted OIBDA, Adjusted OIBDA Leverage Ratio, and Free Cash Flow[26]. - Adjusted OIBDA is defined as operating income before depreciation and amortization, adjusted for share-based compensation, restructuring costs, and unusual gains or losses[27]. - The Adjusted OIBDA Leverage Ratio provides insight into the company's capital structure, calculated as Net Corporate Debt divided by Adjusted OIBDA for the trailing twelve months[28]. - Free Cash Flow is defined as net cash provided by operating activities minus capital expenditures, indicating the company's liquidity and ability to reduce net corporate debt[28]. - These non-GAAP measures are commonly used in the entertainment industry to assess operating performance, but may not be comparable across different companies due to varying calculation methods[31]. - The company believes these measures provide useful information regarding results of operations before non-operating items and cash flows[30]. - Adjusted OIBDA is considered an important measure as it eliminates amounts that do not reflect the fundamental performance of the company's businesses[30]. - The company emphasizes that these non-GAAP measures should be reviewed alongside relevant GAAP financial measures[32]. - Limitations of non-GAAP measures include that they are not prepared in accordance with GAAP and should not be seen as alternatives to GAAP measures[32]. - The company includes adjustments for depreciation, amortization, and restructuring costs in its financial reporting[33].
Lions Gate Entertainment(LGF_A) - 2026 Q3 - Quarterly Results