Lionsgate Studios (LION) Q3 2026 earnings summary

Executive summary

• Fiscal Q3 2026 revenue reached $724.3 million, with operating income of $36.0 million and a net loss attributable to shareholders of $46.2 million, or $0.16 per share; adjusted net income was $3.9 million, or $0.01 per share.

• Adjusted OIBDA was $85.3 million, and trailing 12-month library revenue hit a record $1.05 billion, marking the fifth consecutive record quarter.

• The company completed the Starz Separation, now operating through Motion Picture and Television Production segments, and reported Starz as discontinued operations.

• Renewals secured for 12 of 13 scripted TV series, and a new franchise launched with The Housemaid, with its sequel in production.

• Strategic cost reductions, business restructuring, and governance changes, including board additions and share structure simplification, position the company for agility amid industry disruption.

Financial highlights

• Quarterly revenue rose to $724.3 million from $628.2 million year-over-year, a 15% increase.

• Operating income was $36.0 million, up from $27.7 million in the prior year.

• Net loss attributable to shareholders was $46.2 million, compared to $23.1 million in the prior-year quarter.

• Adjusted OIBDA was $85.3 million, down from $115.2 million in the prior-year quarter.

• Adjusted free cash flow for the quarter was $(57.5) million, compared to $63.2 million in the prior-year quarter.

Outlook and guidance

• Management expects Q4 adjusted OIBDA to improve materially from Q3, driven by strong theatrical carryover and increased Pay-1 window titles.

• Fiscal 2027 projected to see strong adjusted OIBDA growth, supported by a tentpole-heavy film slate and doubled scripted episodic TV deliveries.

• Leverage expected to decline meaningfully as adjusted OIBDA and free cash flow improve, with mid-4x leverage targeted by mid-Fiscal 2027 and 3–3.5x by Fiscal 2028.

• Management reiterated confidence in meeting fiscal 2026 targets and expects significant growth in fiscal 2027 and beyond, citing strong IP investments and expanding franchise properties.

• Cash flow from operations, available credit, and receivables monetization expected to cover operational and debt service needs for the next 12 months and beyond.