Lionsgate Reports Narrowed Losses and Flat Revenue in Third Quarter

Lionsgate, the entertainment giant behind "Saw" and "The Hunger Games," has announced a reduction in losses and a slight dip in revenue for its third quarter.

Improved Financial Performance

For the three-month period ending in December, Lionsgate reported revenue of $970.5 million, marginally lower than the $975.1 million recorded in the same period last year. However, operating income surged to $35.8 million from a loss of $43.5 million in the previous quarter. Net losses attributable to Lionsgate shareholders amounted to $21.9 million, a significant improvement from the $107.4 million loss reported a year ago.

Positive Impact of Content

Lionsgate attributed its improved financial performance to the box office success of "The Best Christmas Pageant Ever" and record earnings from licensing its library of movies and shows. The company also noted that it had begun to recover from the Hollywood labor strikes of 2023.

Surpassing Analyst Expectations

Lionsgate exceeded Wall Street estimates, with analysts predicting revenues of $922 million and earnings per share of 28 cents. The company's stronger-than-expected results led to a jump of over 11% in its stock price during after-hours trading.

Business Highlights

Lionsgate's studio business, encompassing both film and television, reported revenue of $713.8 million, a 3% increase year-over-year. This growth was driven by improved earnings in the TV segment, where revenue increased by 63% to $404.6 million and segment profit rose significantly to $60.9 million. Lionsgate's Media Networks operations, including Starz, experienced a decline in revenue and segment profit due to higher content amortization.

Separation of Lionsgate Studios and Starz

Lionsgate is finalizing the separation of Lionsgate Studios and Starz. As part of the plan, Starz will be led by current CEO Jeff Hirsch and will trade under the stock symbol STRZ, while Lionsgate will trade under the symbol LION.

CEO's Statement

Lionsgate CEO Jon Feltheimer expressed satisfaction with the company's performance in a challenging environment. He cited the record performance of the company's library, the profitability of mid-budget films, and the extensive portfolio of premium properties in the Television Group as key factors in their success.