Starz shares popped 3% on Thursday as the corporate continued to make progress after its separation from Lionsgate, posting a narrowed internet lack of $20.7 million regardless of complete income falling 5.6% 12 months over 12 months to $322.8 million throughout its fourth quarter.
The corporate added 170,000 U.S. subscribers in its fiscal fourth quarter for a complete of 17.6 million, pushed by curiosity in scripted originals together with “Energy Guide IV: Power” Season 3 and “Spartacus: Home of Ashur.”
Streaming was a vibrant spot, with the corporate including 370,000 over-the-top subscribers within the U.S. for a complete of 12.7 million. However income for the section fell to $210.3 million, in comparison with $236.4 million in the identical year-ago interval. In the meantime, the linear TV enterprise shed 200,000 subscribers for a complete of 5 million, although linear/different income grew to $112.5 million from $105.5 million within the year-ago interval.
Common income per consumer fell to $5.74 from $6.32 a 12 months in the past. Starz Networks posted an adjusted working revenue of $55.5 million, rising from a revenue of $25.6 million a 12 months in the past. Through the quarter, Starz reported $7.1 million in content material write-offers and $2.3 million in “different” prices.
Listed here are the quarter’s outcomes:
Internet loss: $20.7 million, in comparison with a lack of $31.8 million a 12 months in the past.
Earnings Per Share: A lack of $1.24 per share, in comparison with a lack of 85 cents per share anticipated by analyst estimates compiled by Yahoo Finance.
Income: $322.8 million, down 5.6% 12 months over 12 months, in comparison with $322.16 million anticipated by analyst estimates compiled by Yahoo Finance.
Working loss: $4.7 million, in comparison with $21.2 million a 12 months in the past.
Starz ended 2025 with $204 million of adjusted EBITDA, exceeding its $200 million outlook. It additionally ended the fourth quarter with $589 million in internet debt and $625 million in gross debt.
The most recent quarterly outcomes come after Starz restructured its Canada enterprise right into a licensing income stream. It additionally accomplished manufacturing on its first wholly-owned sequence “Fightland.” Sky has joined the sequence as a co-commissioning associate. Along with “Fightland,” Starz’s upcoming slate consists of the conclusions of “Outlander” and “Energy Guide III: Elevating Kanan” and the returns of “Blood of My Blood” and “P-Valley.”
“The success of our originals proves that our bedrock technique is working. We ship edgy, premium content material for girls and underrepresented audiences that broad-based streamers don’t deal with,” Starz CEO Jeff Hirsch advised analysts on Thursday. “Content material stays core to every thing we do, and as we take a look at the remainder of 2026, it’s clear now we have certainly one of our most compelling lineups of originals.”
Starz has additionally greenlit “Energy: Origins” for 18 episodes, which is at present in manufacturing and can give attention to the fan-favorite characters Ghost and Tommy as bold younger entrepreneurs. Hirsch additionally touted Pay 1 motion pictures from Lionsgate, together with “The Housemaid” and “Michael” biopic.
Trying forward at full 12 months 2026, Starz expects OTT income development in 2026, single-digit adjusted working revenue development and $80 million to $120 million in constructive free money movement. It additionally will cease disclosing subscribers beginning with its subsequent quarter and anticipates content material spend will are available in at round $650 million.
Longer-term, Starz continues to intention for 20% margins popping out of calendar 12 months 2028, changing 70% of adjusted OIBDA into unlevered free money movement and delevering to 2.5 occasions as shortly as potential.
“We stay laser-focused on OTT income development, profitability, changing Adjusted OIBDA to free money movement, and delevering,” Hirsch added. “We consider this choice is in the very best curiosity of our shareholders, because it places us on a path to reaching the targets we outlined.”
Hirsch added that the corporate continues to see a chance to scale its enterprise from elevated consolidation throughout the media panorama, reiterating the corporate’s curiosity in linear networks “marooned” on the linear TV facet with out “any type of tech functionality or need from their bigger company father or mother to attempt to transition them and reconnect them with their shoppers which have moved to the digital facet.” However he famous a deal must permit the corporate to stay on monitor to realize its objective of lowering debt.
“We don’t actually need to function a enterprise that’s 4 or 5 six occasions leverage,” Hirsch stated. “So we’ll be very cautious about what sort of deal we do relating to leverage.”
Executives additionally touted increasing its bundling and distribution relationships as a key focus within the coming years.
“We’ve arrange the enterprise to be a complimentary or an add-on associate to a broad primarily based streamer, to focused streamers, and in order that’s an actual focus for us,” Starz Networks president Alison Hoffman advised analysts. “We expect, even with the disruption within the trade, that these will come. Our information is displaying that it is rather good for enterprise. The bundles that now we have in place are increasing our [total addressable market]. They’re driving internet new additions to the enterprise. The income is accretive and in the end they’re driving higher retention for the enterprise.”
As for value will increase, Starz executives stated they’d make choices primarily based on developments throughout the remainder of the trade, however that the objective is to stay a complimentary service to the most important streamers.
“We’ve at all times needed to be underpriced, method underpriced of the broad primarily based streamers on the market. In order they proceed to boost charges, it offers us room to boost charges,” Hirsch stated. “You’ve seen the broad primarily based streamers increase wherever from $1 to $3 over the past couple years, so it’s created quite a lot of room for us to have some pricing energy towards the broad-based streamers, and we’ll proceed to have a look at that proper time, proper place, proper slate, to find out whether or not that’s proper for our shoppers. So we’ll watch the trade, watch the broad primarily based streamers, and we’ll make choices primarily based on the place we predict that’s proper to drop that in.”
Hirsch additionally stated that synthetic intelligence could be a “very highly effective software” to boost its enterprise. To cut back prices, Starz used AI for some scenes on “Spartacus: Home of Ashur.” The corporate’s executives additionally see a chance to make use of AI for inner coaching and to assist drive profitability and efficiencies by serving to consider the corporate’s acquisition, retention, pricing information and scheduling content material to “greatest align round lifetime worth and buyer churn.”
“I do consider it is going to be an extra software for the trade. That is nonetheless extra artwork than it’s science, and I feel the inventive course of will proceed to be that method, and and we’re excited to make use of it as a software,” Hirsch added. “However I feel the enterprise has actually grown on the success of the distinctiveness of our originals. I feel that’s exhausting to copy, and so we’re enthusiastic about that.”
