Starz Q1 Loss Widens as Streaming, Linear Revenues Fall

• Starz reported revenue of $306.9 million on a net loss of $164.9 million, or 9.83 per share.

• Wall Street expected revenue of $305.7 million on a loss of 81 cents per share, per Yahoo Finance.

• The quarterly results come as the premium cable network and streamer celebrates its one-year anniversary since the Lionsgate separation

Starz posted a net loss of $164.9 million in the first quarter, widening 7% from a loss of $153 million a year ago.

Meanwhile, total revenue declined 7% to $306.9 million, driven by a 5.5% year over year drop in streaming revenue to $211.1 million and a 6.8% drop in linear and other revenue to $95.8 million. The Starz Networks segment saw operating income fall 37.8% to $58 million, while the company’s total operating loss widened 7% to $152.8 million.

The quarter’s results reflected Starz’s restructuring of its Canada business into a licensing revenue stream. Starz is also no longer disclosing its subscriber figures on a quarterly basis, following in the footsteps of major players Netflix, Disney and Warner Bros. Discovery. The company last disclosed a total of 12.7 million over-the-top subscribers and 5 million linear TV subscribers.

“As we mark the one-year anniversary of our separation today, I’m proud to report that Starz is a structurally stronger company than when we separated. Over the past year, we have executed with discipline against our strategic and financial priorities to position the company for long-term value creation,” Starz CEO Jeff Hirsch said. “Given our progress and one of our strongest content lineups we’ve had in years, we are increasingly confident in our ability to drive OTT revenue growth, reduce leverage, expand margins, and generate sustainable free cash flow in the years ahead.”

Looking ahead, Starz maintained its guidance of positive year over year streaming revenue growth and low single-digit adjusted operating income growth. It also expects unlevered free cash flow between $80 million and $120 million and a leverage ratio exiting 2026 of approximately 2.7 times.

More to come…