What's Happening?
Starz has released its first financial results as a standalone company after separating from Lionsgate. For the quarter ending March 31, 2025, Starz reported a total revenue of $330.6 million, a decrease from $352.4 million the previous year. The company also experienced a widened operating loss of $136.3 million compared to $30.8 million in the same period of 2024. Despite these losses, Starz saw an increase in adjusted OIBDA to $93.3 million, up from $45.5 million. The company celebrated its return to being a standalone public entity by ringing the NASDAQ opening bell. Starz ended the quarter with 12.3 million U.S. streaming subscribers, an increase of 530,000 from the prior quarter, driven by the premiere of Power: Raising Kanan season 4.
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Why It's Important?
The separation from Lionsgate marks a significant shift for Starz, allowing it to focus on its own content production and subscriber growth strategies. The increase in U.S. streaming subscribers indicates strong demand for Starz's original content, which could bolster its position in the competitive streaming market. The financial results, while showing losses, also highlight potential for growth through strategic content reassessment and cost reduction. Analysts are cautiously optimistic about Starz's ability to leverage its IP and production capabilities to enhance its market presence and financial performance.
What's Next?
Starz plans to reduce content costs and rebuild its IP production and program library to maintain subscriber growth. The company aims to lower its debt-to-EBITDA ratio, focusing on debt reduction as a priority. Analysts suggest that Starz's improved content slate in 2025, featuring new seasons of flagship franchises and promising new originals, could stabilize the subscriber base. However, the company must demonstrate steady quarterly performance to fully convince stakeholders of its growth potential.
