Financial Performance - Fourth quarter revenue increased sequentially to $322.8 million, with an operating loss improved to $(4.7) million[1]. - Adjusted OIBDA for the fourth quarter reached $55.5 million, while annual trailing-twelve month Adjusted OIBDA was $204.0 million[1][3]. - The net loss for the quarter was $(20.7) million, translating to a net loss per share of $(1.24)[3][11]. - Net loss from continuing operations for the three months ended December 31, 2025, was $20.7 million, a decrease from a loss of $31.8 million in the same period of 2024[13]. - Adjusted OIBDA for the three months ended December 31, 2025, was $55.5 million, compared to $21.8 million in the previous quarter[15]. - 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]. - Total restructuring and other costs for the three months ended December 31, 2025, amounted to $2.4 million, significantly lower than $183.4 million in the previous quarter[17]. 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]. - Total service subscribers in the United States as of December 31, 2025, were 17.63 million, a slight increase from 17.46 million as of September 30, 2025[24]. - OTT subscribers in the United States increased to 12.66 million as of December 31, 2025, up from 12.29 million as of September 30, 2025[24]. Revenue and Expenses - STARZ's OTT revenue for the quarter was $210.3 million, while total revenue was $322.8 million, reflecting a decrease from $344.5 million in the prior year[11]. - Operating expenses for the quarter totaled $327.5 million, with programming amortization accounting for $132.0 million[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 net cash used in investing activities of $3.9 million for the three months ended December 31, 2025, compared to $57.7 million in the same period of 2024[13]. - The company had 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]. Financial Strategy and Outlook - 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 is focused on a disciplined investment strategy and efficient operating model to drive sustainable OTT revenue growth and profitability[2]. - The company ended the quarter with total net debt of $589.4 million and a total Adjusted OIBDA leverage ratio of 2.9x[3][5]. - STARZ's cash and cash equivalents at the end of the quarter were $35.7 million, an increase from $17.8 million in the previous quarter[9]. 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 performance 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 and are not alternatives to GAAP-defined metrics[32]. - Limitations of non-GAAP measures include potential lack of comparability and the fact that they are not prepared in accordance with GAAP[32]. - The company includes adjustments for depreciation, amortization, and restructuring costs in its financial reporting[33].
Lions Gate Entertainment(LGF_B) - 2026 Q3 - Quarterly Results