Starz Entertainment Corp. (NASDAQ: STRZ) posts Q2 loss but raises 2026 outlook
Rhea-AI Filing Summary
Starz Entertainment Corp. reported second-quarter 2026 revenue of $307.9 million and an operating loss of $175.5 million, driven largely by $151.2 million of restructuring and other costs, including programming contract termination fees. Adjusted OIBDA was $59.9 million. Net loss was $189.4 million, or $11.27 per share.
For the six months ended June 30, 2026, net cash provided by operating activities was $45.0 million. In the quarter, Unlevered Free Cash Flow was $(14.7) million and Equity Free Cash Flow was $(33.4) million. Cash and cash equivalents were $59.6 million, with total debt of $625.1 million and Net Corporate Debt of $565.5 million, resulting in a trailing twelve‑month Adjusted OIBDA Leverage Ratio of 2.9x; the $150.0 million revolver remained undrawn.
The company reported positive year‑over‑year OTT revenue growth and reaffirmed its outlook for positive OTT revenue growth in 2026. Management raised its 2026 outlook for Adjusted OIBDA growth from low‑single‑digits to mid‑single‑digits and now expects Unlevered Free Cash Flow toward the mid‑to‑upper end of the prior $80 million to $120 million range, while reiterating an expected Adjusted OIBDA Leverage Ratio of approximately 2.7x exiting 2026.
Positive
- Raised 2026 non‑GAAP outlook for Adjusted OIBDA (to mid‑single‑digit growth) and Unlevered Free Cash Flow (toward the mid‑to‑upper end of the $80–$120 million range), while maintaining an expected Adjusted OIBDA leverage target of approximately 2.7x exiting 2026.
Negative
- Large GAAP loss and restructuring charges, including a quarterly operating loss of $175.5 million, net loss of $189.4 million, and $151.2 million of restructuring and other costs such as programming contract termination fees.
Filing Explained
As of June 30, Starz reported 16.8 million shares outstanding versus 16.7 million at year-end, potentially reducing existing holders’ ownership percentages.
A Form 8-K reports a specified material event; this one furnishes Starz’s June 30, 2026 quarterly results and August 7 press release under Item 2.02. The release is furnished rather than deemed filed for Section 18 liability purposes.
At June 30, the balance sheet reports
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Revenue Q2 2026: $307.9 million
Operating loss Q2 2026: $(175.5) million
Net loss Q2 2026: $(189.4) million
+5 more
8 metrics
Revenue Q2 2026
$307.9 million
Total revenue for the quarter ended June 30, 2026
Operating loss Q2 2026
$(175.5) million
Operating loss for the quarter ended June 30, 2026
Net loss Q2 2026
$(189.4) million
Net loss from continuing operations for the quarter ended June 30, 2026
Adjusted OIBDA Q2 2026
$59.9 million
Adjusted OIBDA for the quarter ended June 30, 2026
Net cash from operating activities H1 2026
$45.0 million
Net cash flows provided by operating activities for six months ended June 30, 2026
Cash and cash equivalents
$59.6 million
Cash and cash equivalents as of June 30, 2026
Total debt
$625.1 million
Total debt including Term Loan A and senior unsecured notes as of June 30, 2026
Adjusted OIBDA Leverage Ratio
2.9x
Trailing twelve-month Adjusted OIBDA Leverage Ratio as of June 30, 2026
Key Terms
Adjusted OIBDA, Unlevered Free Cash Flow, Equity Free Cash Flow, Adjusted OIBDA Leverage Ratio, +1 more
5 terms
Adjusted OIBDA financial
"Total Adjusted OIBDA Leverage Ratio of 2.9x is calculated based on total Adjusted OIBDA of $195.2 million"
Adjusted OIBDA is a company’s core operating profit before subtracting depreciation and amortization, further cleaned up by removing one-time or unusual items so it shows recurring cash-earning power. Think of it like measuring a car’s steady fuel efficiency after ignoring a flat tire or a rare detour—investors use it to compare underlying operational performance across periods and companies without distortion from non-recurring events or accounting timing.
Unlevered Free Cash Flow financial
"Raising Unlevered Free Cash Flow outlook from between $80 million and $120 million to the mid-to-upper end"
Unlevered free cash flow is the cash a company generates from its core business after paying operating costs and reinvesting in the business, but before any interest or debt repayments. It shows how much cash would be available to all providers of capital—owners and lenders alike—and helps investors compare underlying business performance and value companies without the distortion of different debt levels, like judging a car’s fuel efficiency before adding cargo weight.
Equity Free Cash Flow financial
"Equity Free Cash Flow1: $(33.4) million"
Equity free cash flow is the amount of cash a company generates that is available to pay shareholders after it pays operating costs, reinvests in the business, and handles debt-related payments and borrowings. Think of it as the household money left over after paying bills, fixing the house, and settling loans—funds that could be used for dividends, share buybacks, or retained for future needs. Investors use it to judge how much real cash a company can return to owners and to value a stock.
Adjusted OIBDA Leverage Ratio financial
"Adjusted OIBDA Leverage Ratio3: 2.9x (trailing twelve months)"
A measure of how much debt a company carries relative to its core cash-generating profit, calculated by dividing net debt by adjusted OIBDA (operating income before depreciation and amortization after company-specific adjustments). It matters to investors because it shows how easily a business can cover its debt with recurring operating earnings—like counting how many years of paycheck-sized profits would be needed to pay off a mortgage—so higher ratios signal greater leverage and risk.
Net Corporate Debt financial
"Net Corporate Debt is defined as total debt, excluding Unamortized Debt Issuance Costs, minus Cash and Cash Equivalents"
Earnings Snapshot
Revenue Q2 2026: $307.9 million · Guidance included
Quarter and six months ended June 30, 2026
Revenue Q2 2026
$307.9 million
vs $319.7 million in Q2 2025
Operating loss Q2 2026
$(175.5) million
vs $(26.9) million in Q2 2025
Adjusted OIBDA Q2 2026
$59.9 million
vs $33.4 million in Q2 2025
Net loss Q2 2026
$(189.4) million
vs $(42.5) million in Q2 2025
Net cash from operating activities H1 2026
$45.0 million
vs $1.9 million in six months 2025
Unlevered Free Cash Flow Q2 2026
$(14.7) million
vs $85.6 million in Q2 2025
Guidance
The company reiterates outlook for positive OTT revenue growth in 2026, raises Adjusted OIBDA growth outlook from low-single-digits to mid-single-digits, and now expects Unlevered Free Cash Flow toward the mid-to-upper end of the prior $80 million to $120 million range, with an expected Adjusted OIBDA Leverage Ratio of approximately 2.7x exiting 2026.
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What were Starz Entertainment Corp. (STRZ) Q2 2026 revenues and earnings?
Starz Entertainment Corp. (STRZ) generated $307.9 million in revenue in Q2 2026, with an operating loss of $175.5 million and a net loss of $189.4 million, equivalent to $11.27 basic and diluted net loss per common share.
How did restructuring and contract termination costs affect STRZ’s Q2 2026 results?
Q2 2026 results included $151.2 million of restructuring and other costs, featuring $147.2 million of programming contract termination fees. These items significantly contributed to the quarterly operating loss of $175.5 million and net loss of $189.4 million for Starz Entertainment Corp. (STRZ).
What are STRZ’s cash, debt, and leverage metrics as of June 30, 2026?
As of June 30, 2026, Starz Entertainment Corp. (STRZ) held $59.6 million in cash and cash equivalents and $625.1 million of total debt, resulting in Net Corporate Debt of $565.5 million and a trailing twelve‑month Adjusted OIBDA Leverage Ratio of 2.9x, with a $150.0 million revolver undrawn.
What 2026 outlook did STRZ provide for Adjusted OIBDA and Unlevered Free Cash Flow?
For 2026, Starz Entertainment Corp. (STRZ) raised its Adjusted OIBDA growth outlook from low‑single‑digits to mid‑single‑digits. It now expects Unlevered Free Cash Flow toward the mid‑to‑upper end of the previously stated $80–$120 million range and projects an Adjusted OIBDA leverage ratio of about 2.7x exiting 2026.
How is STRZ’s OTT revenue performing and what is the outlook?
Starz Entertainment Corp. (STRZ) reported positive year‑over‑year OTT revenue growth, with Q2 2026 OTT revenue of $221.3 million versus $221.1 million a year earlier. The company reiterated its 2026 outlook for positive OTT revenue growth as part of its broader financial guidance.
What were STRZ’s key cash flow metrics in early 2026?
For the six months ended June 30, 2026, Starz Entertainment Corp. (STRZ) reported net cash provided by operating activities of $45.0 million. In Q2 2026, Unlevered Free Cash Flow was $(14.7) million and Equity Free Cash Flow was $(33.4) million, reflecting quarter‑specific cash usage.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 7, 2026
(Exact name of registrant as specified in its charter)
| N/A | ||||||||||||||
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
(Address of principal executive offices) (Zip Code)
(604) 648-6559
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||||||||
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||||||||
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange (17 CFR 240.14d-2(b)) | ||||||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | ||||||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
| (Nasdaq Global Select Market) | ||||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
☐
Item 2.02. Results of Operations and Financial Condition.
On August 7, 2026, Starz Entertainment Corp., a corporation organized under the laws of the province of British Columbia, Canada (hereinafter the “Company”), issued a press release announcing its financial results for the quarter ended June 30, 2026. A copy of the Company’s press release is being furnished herewith as Exhibit 99.1 and is incorporated herein by reference in its entirety.
The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit Number | Exhibit Description | ||||
99.1 | Press Release dated August 7, 2026 | ||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | ||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Starz Entertainment Corp. | ||||||||||||||
| Date: | August 7, 2026 | By: | /s/ SCOTT MACDONALD | |||||||||||
| Scott Macdonald | ||||||||||||||
| Chief Financial Officer | ||||||||||||||
Exhibit 99.1
Starz Entertainment Corp. Reports Results for the Second Quarter Ended June 30, 2026
STARZ Increases 2026 Outlook for Adjusted OIBDA and Unlevered Free Cash Flow1 and Reaffirms Year-end Leverage Target of 2.7x2
•Positive Year-over-Year OTT Revenue Growth
•Raising 2026 Outlook Targets for Adjusted OIBDA and Unlevered Free Cash Flow2
•Reiterating 2026 Outlook Targets for Positive OTT Revenue Growth and 2.7x Adjusted OIBDA Leverage2
•Reiterating 20% Adjusted OIBDA Margin Outlook for the Second Half of 20272
SANTA MONICA, CA, and VANCOUVER, B.C., August 7, 2026 – STARZ (NASDAQ: STRZ) today reported results for the quarter ended June 30, 2026. This press release includes consolidated financial results for STARZ Entertainment Corp.
"Our second-quarter results reflect the momentum we are building across the business and the strength of our content portfolio," said STARZ President and CEO Jeffrey Hirsch. "We delivered another quarter of strong audience engagement and OTT revenue growth, and the success of the ‘Fightland’ premiere validates our ownership strategy. The progress we are making and our visibility into the back half of the year increase our confidence that 2026 is becoming a more meaningful inflection year for STARZ than we anticipated."
Summary of Second Quarter 2026 Financial Results
For the quarter ended June 30, 2026, STARZ reported:
•Revenue: $307.9 million
•Operating loss: $(175.5) million due largely to a non-recurring restructuring charge
•Adjusted OIBDA1: $59.9 million
•Net cash used in operating activities: $(28.2) million
•Unlevered Free Cash Flow1: $(14.7) million
•Equity Free Cash Flow1: $(33.4) million
As of June 30, 2026, key balance sheet metrics included:
•Cash and cash equivalents: $59.6 million
•Total debt: $625.1 million, including a $300.0 million Term Loan A credit facility and $325.1 million in senior unsecured notes
•Net debt1: $565.5 million
•Adjusted OIBDA Leverage Ratio3: 2.9x (trailing twelve months)
•The Company’s $150.0 million revolving credit facility remained fully undrawn
2026 outlook:
•Reiterating outlook for positive year-over-year OTT revenue growth
•Raising Adjusted OIBDA growth outlook from low-single-digits to mid-single-digits2
•Raising Unlevered Free Cash Flow outlook from between $80 million and $120 million to the mid-to-upper end of the range2
•Reiterating Adjusted OIBDA Leverage Ratio outlook exiting 2026 estimated to be approximately 2.7x2
1 See “Use of Non-GAAP Financial Measures” for a definition of Adjusted OIBDA, Unlevered Free Cash Flow, Equity Free Cash Flow, and Net Debt. See “Reconciliation of Operating Loss to Adjusted OIBDA” and “Key Performance Indicators” for the related reconciliations to the most directly comparable GAAP measures.
2 The forecasted Operating Income (Loss) and net cash flows provided by operating activities are not reasonably estimable due to the nature of certain individual items: restructuring and other, and adjusted share-based compensation expense. The variability of these items could have a significant impact on our future GAAP financial results. The Company is not providing any 2026 outlook for GAAP financial measures other than OTT revenue growth, nor can the Company provide quantitative reconciliation to the most directly comparable GAAP measures for its forward-looking non-GAAP financial measures in its 2026 outlook because the GAAP measures cannot be reliably estimated and the reconciliations cannot be performed without unreasonable effort due to their dependence on future uncertainties and adjusting items that the Company cannot control or reasonably predict at this time but which may be material. Please see “Use of Non-GAAP Financial Measures” for additional information.
3 Total Adjusted OIBDA Leverage Ratio of 2.9x is calculated based on total Adjusted OIBDA of $195.2 million for the trailing twelve-month period ended June 30, 2026. Refer to “Reconciliation of Operating Loss to Adjusted OIBDA” section for further detail.
Conference Call
•As previously announced, STARZ senior management will hold its analyst and investor conference call to discuss results for the quarter ended June 30, 2026, today, Friday, August 7, 2026, at 8:00 a.m. ET / 5:00 a.m. PT. Interested parties may listen to the live webcast by visiting the events page on the STARZ Investor Relations website. A full replay will become available this evening at the same link.
About STARZ
STARZ is the leading premium entertainment destination for women and underrepresented audiences, and home to some of the most popular franchises and series on television. STARZ offers a robust programming mix for discerning adult audiences, including boundary-breaking originals and an expansive lineup of blockbuster movies, and is embodied by its brand positioning “We’re All Adults Here.” Complementary to any platform or service, STARZ is available across a wide range of digital OTT platforms and multichannel video distributors and is a bundling partner of choice. STARZ is powered by an industry-leading advanced technology, data analytics and digital infrastructure and the highly rated and first-of-its-kind STARZ app.
Investor Inquiries – Contact:
Nilay Shah
nilay.shah@starz.com
Press Inquiries – Contact:
Jennifer Minezaki
jennifer.minezaki@starz.com
The matters discussed in this press release include forward-looking statements, including those regarding expected future performance. Such statements are subject to a number of risks and uncertainties. Actual results in the future could differ materially and adversely from those described in the forward-looking statements as a result of various important factors, including, but not limited to: the benefits of the separation of Lionsgate's Studios Business and Lionsgate's STARZ Business (the “Separation”); unexpected costs related to the Separation; the substantial investment of capital required to produce and market films and television series; budget overruns; limitations imposed by our credit facilities and notes; unpredictability of the commercial success of our programming; risks related to acquisition and integration of acquired businesses; the effects of dispositions of businesses or assets, including individual films or libraries; the cost of defending our intellectual property; technological changes and other trends affecting the entertainment industry; potential adverse reactions or changes to business or employee relationships; the impact of global pandemics on our business; weakness in the global economy and financial markets, including a recession and past and future bank failures; wars, terrorism and multiple international conflicts that could cause significant economic disruption and political and social instability; labor disruptions and strikes; and the other risk factors set forth in STARZ’s Annual Report on Form 10-KT filed with the Securities and Exchange Commission. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect any future events or circumstances.
STARZ ENTERTAINMENT CORP.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
| June 30, | December 31, | ||||||||||
| 2026 | 2025 | ||||||||||
| (Amounts in millions) | |||||||||||
| ASSETS | |||||||||||
| Cash and cash equivalents | $ | 59.6 | $ | 35.7 | |||||||
Accounts receivable, net, including other receivables of $17.5 million and $9.9 million as of June 30, 2026 and December 31, 2025, respectively. | 80.4 | 84.4 | |||||||||
| Prepaid expenses and other | 10.6 | 12.1 | |||||||||
| Total current assets | 150.6 | 132.2 | |||||||||
| Programming content, net | 866.0 | 993.8 | |||||||||
| Property and equipment, net | 47.8 | 49.1 | |||||||||
| Intangible assets, net | 566.1 | 690.9 | |||||||||
| Other assets | 41.3 | 47.2 | |||||||||
| Total assets | $ | 1,671.8 | $ | 1,913.2 | |||||||
| LIABILITIES | |||||||||||
| Current portion of debt | $ | 15.0 | $ | 7.5 | |||||||
| Accounts payable | 60.8 | 60.0 | |||||||||
| Programming related payables | 212.9 | 255.2 | |||||||||
| Other accrued liabilities | 120.9 | 49.1 | |||||||||
| Residuals | 22.2 | 27.1 | |||||||||
| Programming related obligations | 110.8 | 87.7 | |||||||||
| Deferred revenue | 53.4 | 52.8 | |||||||||
| Total current liabilities | 596.0 | 539.4 | |||||||||
| Debt | 600.1 | 605.8 | |||||||||
| Programming related obligations | 6.8 | 41.4 | |||||||||
| Other liabilities | 170.0 | 72.7 | |||||||||
| Deferred tax liabilities | 3.0 | 7.9 | |||||||||
| Total liabilities | 1,375.9 | 1,267.2 | |||||||||
| Contingencies | |||||||||||
| EQUITY | |||||||||||
Common shares, no par value, unlimited authorized, 16.8 million and 16.7 million shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively. | 737.3 | 735.1 | |||||||||
| Accumulated other comprehensive income | 21.4 | 19.4 | |||||||||
| Parent net investment | — | — | |||||||||
| Accumulated deficit | (462.8) | (108.5) | |||||||||
| Total equity | 295.9 | 646.0 | |||||||||
| Total liabilities and equity | $ | 1,671.8 | $ | 1,913.2 | |||||||
STARZ ENTERTAINMENT CORP.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| (Amounts in millions, except per share amounts) | |||||||||||||||||||||||
| Revenue | |||||||||||||||||||||||
| OTT revenue | $ | 221.3 | $ | 221.1 | $ | 432.4 | $ | 446.6 | |||||||||||||||
| Linear and other revenue | 86.6 | 98.6 | 182.4 | 203.7 | |||||||||||||||||||
| Total revenue | 307.9 | 319.7 | 614.8 | 650.3 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Programming amortization | 114.1 | 162.5 | 252.4 | 280.9 | |||||||||||||||||||
| Other operating | 40.5 | 36.5 | 74.8 | 75.2 | |||||||||||||||||||
| Advertising and marketing | 70.3 | 63.4 | 120.7 | 122.3 | |||||||||||||||||||
| General and administrative | 40.0 | 29.1 | 69.1 | 54.5 | |||||||||||||||||||
| Depreciation and amortization | 67.3 | 48.7 | 135.8 | 96.8 | |||||||||||||||||||
| Restructuring and other | 151.2 | 6.4 | 290.3 | 189.8 | |||||||||||||||||||
| Total expenses | 483.4 | 346.6 | 943.1 | 819.5 | |||||||||||||||||||
| Operating loss | (175.5) | (26.9) | (328.3) | (169.2) | |||||||||||||||||||
| Interest expense | (13.6) | (13.2) | (27.5) | (24.1) | |||||||||||||||||||
| Interest and other income | 0.5 | — | 0.9 | 1.7 | |||||||||||||||||||
| Other expense | (2.0) | (2.5) | (3.8) | (4.3) | |||||||||||||||||||
| Loss on extinguishment of debt | — | — | — | (0.7) | |||||||||||||||||||
| Loss from continuing operations | (190.6) | (42.6) | (358.7) | (196.6) | |||||||||||||||||||
| Income tax benefit | 1.2 | 0.1 | 4.4 | 0.1 | |||||||||||||||||||
| Net loss from continuing operations | (189.4) | (42.5) | (354.3) | (196.5) | |||||||||||||||||||
| Net income from discontinued operations, net of income taxes | — | — | — | 1.0 | |||||||||||||||||||
| Net loss | $ | (189.4) | $ | (42.5) | $ | (354.3) | $ | (195.5) | |||||||||||||||
| Per share information attributable to Starz Entertainment Corp. shareholders: | |||||||||||||||||||||||
| Basic and diluted net loss per common share - continuing operations | $ | (11.27) | $ | (2.54) | $ | (21.12) | $ | (11.75) | |||||||||||||||
| Basic and diluted net income per common share - discontinued operations | — | — | — | 0.06 | |||||||||||||||||||
| Basic and diluted net loss per common share | $ | (11.27) | $ | (2.54) | $ | (21.12) | $ | (11.69) | |||||||||||||||
| Weighted average number of common shares outstanding: | |||||||||||||||||||||||
| Basic | 16.8 | 16.7 | 16.8 | 16.7 | |||||||||||||||||||
| Diluted | 16.8 | 16.7 | 16.8 | 16.7 | |||||||||||||||||||
STARZ ENTERTAINMENT CORP.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
| Six Months Ended | |||||||||||
| June 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| (Amounts in millions) | |||||||||||
| Operating activities: | |||||||||||
| Net loss | $ | (354.3) | $ | (195.5) | |||||||
| Less: net income from discontinued operations, net of tax | — | 1.0 | |||||||||
| Net loss from continuing operations, net of tax | (354.3) | (196.5) | |||||||||
| Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 135.8 | 96.8 | |||||||||
| Programming amortization | 252.4 | 280.9 | |||||||||
| Amortization of debt financing costs and other non-cash interest | 2.3 | 2.0 | |||||||||
| Share-based compensation | 20.2 | 11.7 | |||||||||
| Other amortization | 4.2 | 3.5 | |||||||||
| Net content impairment | 129.2 | 167.3 | |||||||||
| Loss on extinguishment of debt | — | 0.7 | |||||||||
| Deferred income taxes | — | 0.2 | |||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable, net | 2.6 | 60.1 | |||||||||
Cash paid for programming content(1) | (294.9) | (394.3) | |||||||||
| Other assets | 2.8 | (5.5) | |||||||||
| Accounts payable and accrued liabilities | 145.4 | 4.2 | |||||||||
| Residuals | (1.3) | (0.1) | |||||||||
| Deferred revenue | 0.6 | 6.4 | |||||||||
| Due to LG Studios Business | — | (35.5) | |||||||||
| Net cash flows provided by operating activities | 45.0 | 1.9 | |||||||||
| Investing activities: | |||||||||||
| Capital expenditures | (9.7) | (10.8) | |||||||||
| Deferred purchase price of receivables sold | 1.2 | 0.5 | |||||||||
| New Lionsgate revolving credit facility – increases | — | 455.5 | |||||||||
| New Lionsgate revolving credit facility – decreases | — | (321.5) | |||||||||
| Net cash flows (used in) provided by investing activities | (8.5) | 123.7 | |||||||||
| Financing activities: | |||||||||||
| Programming related obligations – borrowings | 238.2 | 290.6 | |||||||||
| Programming related obligations – repayments | (251.0) | (278.7) | |||||||||
| Exercise of stock options | 0.2 | — | |||||||||
| Distribution of Exchange Notes to New Lionsgate upon Separation | — | (389.9) | |||||||||
| Debt – borrowings, net of debt issuance and redemption costs | — | 388.3 | |||||||||
| Debt repayments | — | (96.5) | |||||||||
| Parent net investment | — | (2.0) | |||||||||
| Net cash flows used in financing activities | (12.6) | (88.2) | |||||||||
| Net change in cash and cash equivalents | 23.9 | 37.4 | |||||||||
| Cash and cash equivalents – beginning of period | 35.7 | 14.2 | |||||||||
| Cash and cash equivalents – end of period | $ | 59.6 | $ | 51.6 | |||||||
__________________________________
(1)Cash paid for programming content for the six months ended June 30, 2026 includes $157.1 million from the licensing of program rights from the LG Studios Business.
STARZ ENTERTAINMENT CORP.
RECONCILIATION OF OPERATING LOSS TO ADJUSTED OIBDA
| Three Months Ended | Trailing Twelve Months | ||||||||||||||||||||||||||||||||||
| June 30, | September 30, | December 31, | March 31, | June 30, | June 30, | ||||||||||||||||||||||||||||||
| 2025 | 2025 | 2025 | 2026 | 2026 | 2026 | ||||||||||||||||||||||||||||||
| (Amounts in millions) | |||||||||||||||||||||||||||||||||||
| Operating loss | $ | (26.9) | $ | (34.8) | $ | (4.7) | $ | (152.8) | $ | (175.5) | $ | (367.8) | |||||||||||||||||||||||
| Depreciation and amortization | 48.7 | 47.9 | 47.3 | 68.5 | 67.3 | 231.0 | |||||||||||||||||||||||||||||
Restructuring and other(1) | 6.4 | 5.0 | 9.4 | 139.1 | 151.2 | 304.7 | |||||||||||||||||||||||||||||
Adjusted share-based compensation expense(2) | 5.2 | 3.7 | 3.5 | 3.2 | 16.9 | 27.3 | |||||||||||||||||||||||||||||
Adjusted OIBDA(3) | $ | 33.4 | $ | 21.8 | $ | 55.5 | $ | 58.0 | $ | 59.9 | $ | 195.2 | |||||||||||||||||||||||
_______________
(1)Restructuring and other includes restructuring costs, certain transaction-related and other expenses, and unusual items, when applicable, as shown in the table below:
| Three Months Ended | Trailing Twelve Months | ||||||||||||||||||||||||||||||||||
| June 30, | September 30, | December 31, | March 31, | June 30, | June 30, | ||||||||||||||||||||||||||||||
| 2025 | 2025 | 2025 | 2026 | 2026 | 2026 | ||||||||||||||||||||||||||||||
| (Amounts in millions) | |||||||||||||||||||||||||||||||||||
Content impairments(a) | $ | (0.3) | $ | — | $ | 7.1 | $ | 128.1 | $ | 1.7 | $ | 136.9 | |||||||||||||||||||||||
Contract termination fees(b) | — | — | — | — | 147.2 | 147.2 | |||||||||||||||||||||||||||||
Transaction and other costs(c) | 4.5 | 4.8 | 2.1 | 5.1 | 1.7 | 13.7 | |||||||||||||||||||||||||||||
Severance(d) | — | — | 0.2 | 5.9 | 0.5 | 6.6 | |||||||||||||||||||||||||||||
Share-based compensation(e) | 2.2 | 0.2 | — | — | 0.1 | 0.3 | |||||||||||||||||||||||||||||
| Total restructuring and other | $ | 6.4 | $ | 5.0 | $ | 9.4 | $ | 139.1 | $ | 151.2 | $ | 304.7 | |||||||||||||||||||||||
_______________
(a)During 2025 and 2026, Starz undertook actions to rationalize its content portfolio as part of its ongoing efforts to right‑size its content cost structure in response to the evolving macroeconomic and industry environment, including continued declines in traditional linear services, impairments associated with changes in the Canadian operating model and in connection with becoming and operating as a standalone company following the Separation. These actions included evaluating programming on the Starz Platform, cancelling certain previously ordered programming, and removing and abandoning content determined to have limited strategic value.
(b)In April 2026, Starz entered into an agreement to terminate certain live-action films under a post pay-one output licensing agreement. As a result, Starz recognized programming contract termination fees, which were recorded within Restructuring and other costs during the three and six months ended June 30, 2026.
(c)Transaction and other costs reflect costs associated with certain potential strategic transactions, costs associated with certain legal matters, and transaction, integration and legal costs associated with the separation from Lionsgate.
(d)Severance costs represent a reduction in our work force due to cost-saving initiatives and the continued decline in traditional linear services.
(e)This balance includes a modification of equity awards in connection with the separation from Lionsgate. In June 2025, the compensation committee of the Company approved a cash payment in lieu of share issuance for the restricted share units that vested in July and August 2025.
STARZ ENTERTAINMENT CORP.
(2)The following table reconciles total share-based compensation expense to adjusted share-based compensation expense:
| Three Months Ended | Trailing Twelve Months | ||||||||||||||||||||||||||||||||||
| June 30, | September 30, | December 31, | March 31, | June 30, | June 30, | ||||||||||||||||||||||||||||||
| 2025 | 2025 | 2025 | 2026 | 2026 | 2026 | ||||||||||||||||||||||||||||||
| (Amounts in millions) | |||||||||||||||||||||||||||||||||||
| Total share-based compensation expense | $ | 7.4 | $ | 3.9 | $ | 3.5 | $ | 3.2 | $ | 17.0 | $ | 27.6 | |||||||||||||||||||||||
Less: Amount included in restructuring and other(a) | (2.2) | (0.2) | — | — | (0.1) | (0.3) | |||||||||||||||||||||||||||||
| Adjusted share-based compensation expense | $ | 5.2 | $ | 3.7 | $ | 3.5 | $ | 3.2 | $ | 16.9 | $ | 27.3 | |||||||||||||||||||||||
_______________
(a)Includes a modification of equity awards in connection with the Separation included in restructuring and other expenses. Refer to note (1)(e).
(3)See "Use of Non-GAAP Financial Measures" for the definition of Adjusted OIBDA which is reconciled to operating loss in the table above, the most directly comparable GAAP financial measure.
STARZ ENTERTAINMENT CORP.
KEY PERFORMANCE INDICATORS (KPIs)
| Three Months Ended | |||||||||||||||||||||||||||||
| June 30, | September 30, | December 31, | March 31, | June 30, | |||||||||||||||||||||||||
| 2025 | 2025 | 2025 | 2026 | 2026 | |||||||||||||||||||||||||
| (Amounts in millions) | |||||||||||||||||||||||||||||
| Equity and Unlevered Free Cash Flow | |||||||||||||||||||||||||||||
| Net cash provided by (used in) operating activities | $ | 65.4 | $ | (26.0) | $ | (21.4) | $ | 73.2 | $ | (28.2) | |||||||||||||||||||
| Less: capital expenditures | (6.9) | (5.2) | (4.5) | (4.5) | (5.2) | ||||||||||||||||||||||||
| Total Equity Free Cash Flow | 58.5 | (31.2) | (25.9) | 68.7 | (33.4) | ||||||||||||||||||||||||
| Plus: cash paid for interest | 26.9 | 9.2 | 19.1 | 11.6 | 18.4 | ||||||||||||||||||||||||
| Plus: cash paid for income taxes | 0.2 | 0.4 | 0.2 | 0.4 | 0.3 | ||||||||||||||||||||||||
| Total Unlevered Free Cash Flow | $ | 85.6 | $ | (21.6) | $ | (6.6) | $ | 80.7 | $ | (14.7) | |||||||||||||||||||
| Cash paid for programming content | |||||||||||||||||||||||||||||
| Starz Networks | $ | (143.5) | $ | (157.0) | $ | (158.6) | $ | (85.5) | $ | (147.6) | |||||||||||||||||||
Programming content restructuring(1) | (4.8) | (2.7) | (4.0) | (27.9) | (34.0) | ||||||||||||||||||||||||
| Total cash paid for programming content | $ | (148.3) | $ | (159.7) | $ | (162.6) | $ | (113.4) | $ | (181.6) | |||||||||||||||||||
| Net corporate debt | |||||||||||||||||||||||||||||
Debt(2) | $ | 625.1 | $ | 625.1 | $ | 625.1 | $ | 625.1 | $ | 625.1 | |||||||||||||||||||
| Less: cash and cash equivalents | 51.6 | 37.0 | 35.7 | 102.1 | 59.6 | ||||||||||||||||||||||||
| Net corporate debt | $ | 573.5 | $ | 588.1 | $ | 589.4 | $ | 523.0 | $ | 565.5 | |||||||||||||||||||
| Adjusted OIBDA - trailing twelve months | $ | 178.6 | $ | 173.2 | $ | 204.0 | $ | 168.7 | $ | 195.2 | |||||||||||||||||||
Adjusted OIBDA leverage ratio(3) | 3.2x | 3.4x | 2.9x | 3.1x | 2.9x | ||||||||||||||||||||||||
_______________
(1)Represents cash used in operating activities for programming content paid subsequent to the final shutdown of the LIONSGATE+ business in May 2024 and the Starz Networks Strategic Content Review and International Restructuring. Such cash flows are included in continuing operations in the consolidated statements of cash flow.
(2)Debt represents total debt, excluding unamortized debt issuance costs.
(3)Adjusted OIBDA leverage ratio is defined as Net Corporate Debt (represents total debt, excluding unamortized debt issuance costs, minus cash and cash equivalents), divided by Adjusted OIBDA for the trailing twelve-months.
STARZ ENTERTAINMENT CORP.
USE OF NON-GAAP FINANCIAL MEASURES
This earnings release presents the following important financial measures utilized by Starz Entertainment Corp. (the "Company," “Starz,” "we," "us" or "our") that are not financial measures defined by U.S. generally accepted accounting principles ("GAAP"). These non-GAAP financial measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with United States GAAP.
Adjusted OIBDA: Adjusted OIBDA is defined as operating income (loss) before depreciation and amortization ("OIBDA"), adjusted for share-based compensation ("adjusted SBC"), restructuring and other costs, and unusual gains or losses, (such as goodwill and intangible asset impairment), when applicable.
•Depreciation and amortization as presented on our consolidated statement of operations.
•Adjusted share-based compensation represents share-based compensation excluding the impact of the acceleration of certain vesting schedules for equity awards pursuant to certain severance arrangements, which are included in restructuring and other expenses, when applicable.
•Restructuring and other includes restructuring costs, certain transaction-related and other expenses, and unusual items, when applicable.
•Goodwill impairment and intangible asset impairment, when applicable.
Adjusted OIBDA Leverage Ratio: Adjusted OIBDA Leverage Ratio is defined as Net Corporate Debt (represents total debt, excluding Unamortized Debt Issuance Costs, minus Cash and Cash Equivalents), divided by Adjusted OIBDA for the trailing twelve-months.
Unlevered Free Cash Flow: Unlevered Free Cash Flow is defined as net cash provided by (used in) operating activities, less capital expenditures, plus cash paid for interest and taxes.
Equity Free Cash Flow: Equity Free Cash Flow is defined as net cash provided by (used in) operating activities, less capital expenditures.
Net Corporate Debt: Net Corporate Debt is defined as total debt, excluding Unamortized Debt Issuance Costs, minus Cash and Cash Equivalents.
Overall: These measures are non-GAAP financial measures as defined in Regulation G promulgated by the SEC and are in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.
We use these non-GAAP measures, among other measures, to evaluate the operating performance of our business. We believe these measures provide useful information to investors regarding our results of operations before non-operating items and cash flows. Adjusted OIBDA is considered an important measure of the Company’s performance because this measure eliminates amounts that, in management’s opinion, do not necessarily reflect the fundamental performance of the Company’s businesses, are infrequent in occurrence, and in some cases are non-cash expenses. In addition, the Adjusted OIBDA Leverage Ratio is an important metric as it provides insight into the Company’s capital structure and financial risk, helping assess the Company’s ability to meet its debt obligations and maintain financial flexibility. Unlevered Free Cash Flow and Equity Free Cash Flow are considered important measures of the Company’s liquidity because they provide information about the ability of the Company to reduce Net Corporate Debt and make strategic investments. Net Corporate Debt is used by management to evaluate the Company’s overall indebtedness and capital structure by reflecting debt levels net of available liquidity, and is an important measure in assessing leverage, financial risk, and the Company’s capacity to service and reduce debt over time. The Company utilizes these measures, among others, to evaluate the performance of its business relative to its peers and the broader market.
These non-GAAP measures are commonly used in the entertainment industry and by financial analysts and others who follow the industry to measure operating performance. However, not all companies calculate these measures in the same manner and the measures as presented may not be comparable to similarly titled measures presented by other companies due to differences in the methods of calculation and excluded items.
A general limitation of these non-GAAP financial measures is that they are not prepared in accordance with GAAP. These measures should be reviewed in conjunction with the relevant GAAP financial measures and are not presented as an alternative measure of operating income, cash flow, net income (loss), or earnings (loss) per share as determined in accordance with GAAP.