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Lionsgate on Thursday reported a fiscal third-quarter profit on falling revenue, as the Hollywood studio endured weak film titles that could not compare with last year’s Wonder.
Lionsgate reported earnings of 10 cents per share for the three months ending on Dec. 31 compared with a profit of 87 cents per share in 2018.
Third-quarter revenues came to $933 million against a year-earlier $1.14 billion.
The company beat the expectations of Wall Street on the bottom line and matched them on the top line.
The studio’s motion picture revenues were $363 million, down from $539 million, while television production came in at $217 million, down from $266 million. The only gain came in the media networks segment, which reported revenue of $377 million, up from $354 million.
The company said its Starz cable asset finished the quarter with 25.1 million domestic subscribers, “up 1.1 million year over year and driven by strong OTT subscriber growth.”
Media networks, driven by Starz, posted a $134 million profit, up from $122 million, while the motion picture and television production segments each posted declines in profit.
“As we refill our feature film and television pipelines at a robust pace and take our integration of Lionsgate and Starz to the next level, all signs are pointing to strong growth in the year ahead,” said CEO Jon Feltheimer.
Unmentioned in the report was Robin Hood, which was released in November and earned just $84 million worldwide at the box office on an estimated budget of $100 million.
Shares of Lionsgate closed slightly lower on Thursday and were off a bit more in the after-hours session as well. The stock is down 50 percent in the last 13 months.
“With the stock down so hard, we can still argue that Lionsgate can be bought, and we find encouragement in very healthy OTT subscriber trend at Starz, a nascent international ramp at Starz, and a movie history that argues for cyclicality and a return to excitement about the slate at some point from this low ebb,” B. Riley FBR analyst Barton Crockett said in a note before the latest earnings release from Lionsgate.
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