Oct 29, 2026 earnings call — Focus on content ownership and cash flow
Starz reaffirmed its 2026 unlevered free cash flow target of $100 million to $120 million after a strong Q3 with $322 million total revenue.
Revenue $0.3B (est $0.3B) · EPS $-2.02 (est $-2.70)
Key quotes
"We are executing against our 4 key priorities of growing OTT revenue, adjusted OIBDA and free cash flow while reducing leverage."
"Owning more of our own content gives us greater control over costs and allows us to retain more of the long-term value of successful IP."
"Bundles continue to perform really well for Starz. And with the consolidation that we're seeing across the industry, we really expect a new wave of distribution and bundling partners to continue into 2027."
Analyst Q&A 8
Fightland results and bundling deals
Q (John Rigatti · Baird): How did Fightland perform versus expectations and what was its impact on acquisition and engagement? Also, what did you learn about owning original shows? And what have you observed so far from recent bundling deals like Peacock and Crunchyroll?
A: Management said Fightland performed well, they feel good about the season and are already developing a season 2. They noted revenue from linear and international sales with Sky and said owning content is valuable and can add a new revenue line. On bundling, they said bundles perform well, early results for Peacock and Crunchyroll are encouraging, the Amazon super bundle is promising, retention improves (north of 20%) and bundling is accretive to revenue.
"We feel very good about the arc of the show and the path of the show." — Jeffrey Hirsch (CEO)
P-Valley outlook and OIBDA guidance
Q (Andrew Crum · B. Riley): What is your outlook for the third season of P-Valley and its expected impact on the service? Also, how should we reconcile adjusted OIBDA guidance for the year versus Q4?
A: They said P-Valley returns December 4, has a large fan base and strong teaser performance, and they expect strong subscriber acquisition and engagement that will help set up 2027. On adjusted OIBDA, Q3 outperformed, so they are investing more marketing into P-Valley; they still expect a very strong Q4 and remain comfortable with mid-single digit adjusted OIBDA growth for the year.
"It is a rare show in the TV landscape that is both critically acclaimed and commercially so successful." — Alison Hoffman (PRESIDENT)
Shift from subs to revenue and AI agents
Q (Brent Penter · Raymond James): Since shifting away from quarterly subscriber reporting to revenue and OIBDA growth, how has the business changed (subs, ARPU, retention)? And how do you view the risk of AI agents managing subscriptions? Also, why acquire S.W.A.T. Exiles and are similar deals available?
A: They said the shift is healthy: they focus on 24-month revenue growth, longer-tenured customers, lifetime value, higher ARPU, historic low churn, and one-year-plus subs at all-time highs. On AI agents, they said the best defense is a strong, year-round programming slate and noted 70% of the business is wholesale, limiting exposure; they believe their programming and distribution mix reduce the risk. On S.W.A.T. Exiles, they said it was attractive as a long-running franchise that brings new customers, strong diversity, and they will look for similar acquisition opportunities.
"Subs that are 1 year or longer are really -- in terms of number and share, are at all-time high." — Jeffrey Hirsch (CEO)
Fightland distribution and consolidation interest
Q (David Joyce · Seaport Research Partners): Was the other distribution revenue from Fightland a one-time item or are more territories to come? And did you consider buying ALLBLK or similar assets as part of consolidation?
A: They said they recognized revenue from the Sky deal and Canadian revenue this quarter and expect distribution revenue to be lumpy as they build a portfolio of owned shows. They added there is more of the world still to be sold for Fightland. On consolidation, they said they continue to see opportunities but are focused on diversifying into AVOD rather than buying ALLBLK, which they said they did not look at.
"So on the distribution revenue associated with Fightland, yes, we recognized the revenue associated with the Sky deal in the quarter and as well as the Canadian revenue." — Scott MacDonald (CFO)
Verizon renewal and growth drivers
Q (Matthew Condon · Citizens Bank): How do the Verizon renewal economics compare to the prior deal and how do you balance rate increases with maintaining distribution? Also, what are the main drivers behind improved engagement and churn despite price increases?
A: They said the Verizon negotiation was unfortunate in timing but the final deal has no material impact on this year's guide or next year. Most current distributor deals are a la carte or rev-share and align economics with partners. On engagement, they said the primary driver is a consistent, strong content slate year-round which reduces churn, raises ARPU, and increases lifetime value; recent and upcoming shows (P-Valley, Origins, potential Legacy, co-commissions, movie rights) help that consistency.
"Look, I think first and foremost, it's the content slate, right?" — Jeffrey Hirsch (CEO)
Super bundles and international programming
Q (David Karnovsky · JPM): How do you view large super bundles like Prime's 5-service offering for Starz in terms of new subs and ARPU? And can you share Fightland performance metrics in the U.K. and whether you will adjust programming for international audiences?
A: They said early results from the super bundle are encouraging and they are seeing customers take it with improved retention even early on. For international, they said they need multiple owned shows to make output deals meaningful; as they add more owned shows in '27 and '28 they can create output deals and will invite international partners into development to make content work for those markets.
"And again, even early on, we're seeing improved retention with that bundle." — Alison Hoffman (PRESIDENT)
Production independence and AVOD plans
Q (Sean Diffley · Morgan Stanley): What have you learned after moving production away from Lionsgate—do you have more freedom and cost efficiencies? And what could diversifying into AVOD look like and what do you need to do it?
A: They said AVOD could be built around their two core demos to add incremental revenue, create a lower-priced ad tier, and give pricing power between tiers, but any move must be industrially logical and avoid overlevering the business. On production, they said returning to in-house production required adding production finance leadership, Fightland looked strong on-air, and their average cost per Fightland episode is significantly lower than under the prior parent, producing meaningful cost savings when repeated.
"If you do that multiple times, that's really meaningful cost savings." — Jeffrey Hirsch (CEO)
AI in production and Seedance sell-off
Q (Matthew Harrigan · Benchmark StoneX): How are you using AI to cut production costs and expand programming efficiently? And did the Seedance panic sell-off in February affect your subscriber or churn trends?
A: They said AI helps schedule the network, acquire and merchandise content, and tune many retail and pricing variables using billions of data points since the app launch; AI also shortens post production and they plan to be a fast follower. On Seedance, they said churn remained at historic lows, they didn't see a meaningful churn impact, and being 70% wholesale gives some insulation, though they continue to monitor data daily.
"The AI tools have really been helping us tune the business to long-term revenue growth." — Jeffrey Hirsch (CEO)