Financial Data and Key Metrics Changes - Revenue for Q4 2025 increased to $25.5 million from $25.1 million in Q4 2024, driven by member base growth and increasing ARPU [11] - Gross profit in Q4 increased to $22.3 million from $21.3 million in the same quarter last year, with a gross margin of 87.6% [11] - Full-year revenue for 2025 was $99.0 million, up from $89.3 million in 2024, representing an 11% year-over-year growth [12] - Free cash flow improved by $2.2 million to $4.9 million from $2.7 million in the prior year [13] - Cash position at the end of 2025 improved to $13.5 million from $5.9 million a year ago [13] Business Line Data and Key Metrics Changes - Subscriber growth for Q4 remained solid, adding 20,000 members, with total member count exceeding 900,000 for the first time [5] - Gross profit per employee increased to $825,000 from $730,000 year-over-year, reflecting improved operating efficiency [5][9] Market Data and Key Metrics Changes - The company is focusing on its direct channel, which accounts for approximately two-thirds of its direct members having been with Gaia for more than one year, indicating strong customer loyalty [6] - The direct platform is expected to deliver double the retention and revenue per member compared to third-party distribution [7] Company Strategy and Development Direction - Gaia is transitioning towards a more integrated AI platform while continuing to build on its strong SVOD foundation [5] - The company will no longer report total subscriber count as a primary metric, focusing instead on revenue growth, free cash flow, lifetime value, and earnings [8] - A price increase is being implemented, with expectations of lower churn compared to previous increases, reflecting the value delivered through AI Guides and content [19][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving profitability in Q4 2026, supported by disciplined management of operating expenses and strong performance [5][10] - The company anticipates similar annual revenue growth rates in 2026, with continued growth in ARPU and a focus on direct members [15] Other Important Information - The company has zero debt outside of a mortgage on its campus, which has a new five-year extension [13] - AI is now embedded across major functions, enhancing operational efficiency and member engagement [9] Q&A Session Summary Question: Will customers continue to pay higher prices with the price increases? - Management noted that member growth in Q4 was driven by strong execution and seasonal strength, and they are seeing lower churn compared to previous price increases [18][19] Question: What is the expected growth from new initiatives like Igniton? - Management indicated that growth will primarily come from the core business, with Igniton expected to grow faster than the core business but still not material at this stage [22][26] Question: Can you confirm the guidance for double-digit revenue growth in 2026? - Management confirmed the guidance for double-digit revenue growth in 2026 remains unchanged [32] Question: What percentage of subscribers are third-party subscribers and plans to convert them? - Management stated that they aim to limit third-party subscribers to around 20% and will focus on marketing direct channels [47] Question: What are the plans for free cash flow and potential acquisitions? - Management confirmed plans to remain free cash flow positive but did not comment on specific acquisition targets at this time [50]

Core Viewpoint - Starz aims to position itself strategically in the M&A landscape by acquiring linear networks that are undervalued by larger owners, leveraging its technology and expertise to transition these brands into the digital space [1][4]. Financial Performance - Starz reported a revenue of $320.9 million for the quarter ending September, down from $346.9 million year-over-year, aligning with Wall Street forecasts [5]. - Net losses increased to $52.6 million from $30.6 million, while adjusted EBITDA was $21 million, lower than expected, but the company reaffirmed its annual guidance of $200 million [6]. Subscriber Metrics - The company ended the quarter with 12.3 million U.S. OTT subscribers, a sequential increase of 110,000, while total U.S. subscribers decreased by 130,000 to 17.5 million [7]. - Total North American subscribers reached 19.2 million, with a sequential increase of 120,000, driven by a 250,000 increase in Canadian subscribers following the resolution of a carriage dispute [8]. Content Strategy - Starz is focusing on developing a steady pipeline of shows with longer seasons of 18-22 episodes to enhance viewer engagement and reduce churn [7]. - The company is working towards owning half of its content slate and has initiated several writers' rooms post-separation from Lionsgate, with its first original series "Fightland" currently in production [8]. Structural Changes - A new content licensing agreement has been established with Bell Canada, transitioning from a joint venture model to a more stable structure, allowing Starz to generate international licensing revenue while Bell manages operations [10][11].