Starz Entertainment (STRZ) Q4 2025 earnings summary

Executive summary

• Completed separation from Lionsgate, now operating as a standalone public company with a focus on digital, subscription-based revenue and no linear advertising exposure.

• Achieved $1,369.6 million in annual revenue and $201.5 million in adjusted EBITDA (OIBDA) for the year ended March 31, 2025, with a 15% profit margin.

• U.S. OTT subscriber base grew by 530,000 in the quarter, with total U.S. subscribers up nearly 2% sequentially, driven by original content premieres such as Raising Kanan Season 4.

• North American revenue declined year-over-year and sequentially due to a strike-impacted year with limited new content.

• Incurred a $177.4 million restructuring charge in Q4 related to content and other impairments as part of a strategic reassessment.

Financial highlights

• Fourth quarter revenue was $330.6 million, with adjusted EBITDA (OIBDA) of $93.3 million, more than doubling year-over-year.

• Fiscal year revenue totaled $1,369.6 million, down from $1,392.4 million year-over-year.

• Adjusted EBITDA for the fiscal year rose to $201.5 million from $170.2 million.

• Ended the quarter with 12.3 million U.S. OTT subscribers (up 530,000 sequentially) and 18 million total U.S. subscribers (up 320,000 sequentially).

• North American subscribers declined by 330,000 sequentially due to a Canadian carriage dispute, with minimal revenue impact due to low ARPU.

Outlook and guidance

• Forecasts approximately $200 million in adjusted EBITDA (OIBDA) for calendar 2025.

• Sequential revenue growth expected in Q3 and Q4 of 2025, with positive year-over-year revenue growth anticipated in calendar 2026.

• Targeting margin expansion to 20% by the end of calendar 2028, driven by increased ownership of IP and cost efficiencies.

• Plans to convert 70% of adjusted EBITDA to unlevered free cash flow by calendar 2026.