STARZ more than doubled its adjusted operating income before depreciation and amortisation (OIBDA) to $44.2m in the third quarter of 2026, from $21.8m a year earlier, the premium network and streaming company reported on Thursday 29 October. Revenue rose to $322.4m from $320.9m. On a GAAP basis STARZ still lost money: its operating loss was $21.2m, against $34.8m in the same quarter of 2025.
Key facts
- Revenue for the three months to 30 September 2026: $322.4m (2025: $320.9m)
- Streaming (OTT) revenue: $226.6m, up from $222.8m; linear and other revenue: $95.8m, down from $98.1m
- Adjusted OIBDA: $44.2m (2025: $21.8m); operating loss: $21.2m (2025: $34.8m); net loss: $34.8m (2025: $52.6m)
- Cash $86.8m and total debt $687.5m at 30 September; net corporate debt $600.7m
- All 2026 targets kept, including unlevered free cash flow of $100m to $120m
Where the gap between the two profit lines comes from
The difference between the adjusted and GAAP figures is mostly depreciation and amortisation, which rose to $67.4m from $47.9m. Adjusted OIBDA also excludes restructuring charges and share-based pay. In this quarter the restructuring line was a credit of $8.3m, mainly because STARZ cut its estimate of what it owes for ending an output arrangement, by $11.1m, and booked $3.6m of content recoveries.
That arrangement dates from April 2026, when STARZ agreed to terminate its rights to certain live-action films under a post-pay-one licensing deal. The fee is tied in part to those films’ theatrical box office. STARZ said it revised its assumptions about how some of the films will perform in cinemas, which reduced the accrued fee by $11.1m in the quarter.
Programming amortisation, the cost of content written off as it airs, fell to $141.5m from $156.8m. Advertising and marketing spending fell to $74.2m from $78.4m.
Cash and debt
Operating activities generated $18.9m of cash in the quarter. STARZ’s own measure of unlevered free cash flow was $18.8m, and equity free cash flow $13.1m. Adding up the quarterly figures in the release, we calculate unlevered free cash flow for the first nine months at $84.8m. Debt comprised a $362.4m Term Loan A and $325.1m of senior unsecured notes. The company puts its net corporate debt at 2.8 times trailing 12-month adjusted OIBDA of $217.6m, and its $183m revolving credit facility was undrawn.
Over nine months, revenue was $937.2m, down from $971.2m, and streaming revenue was $659.0m, down from $669.4m. The operating loss was $349.5m, against $204.0m. Restructuring and other costs reached $282.0m, against $194.8m, all of it booked in the first half, and depreciation and amortisation rose to $203.2m from $144.7m.
Chief executive Jeffrey Hirsch said a “portfolio approach to programming is driving a more durable revenue base”, adding that the company is “just beginning to unlock the financial upside of increased ownership”.
What STARZ did not report
The release gives no subscriber numbers for the quarter, and it does not break out spending on originals against licensed films. STARZ became a standalone company after its separation from Lionsgate, whose film business has since been forming new partnerships of its own. For other moves in US and European streaming this month, see our reports on Disney+ and Channel 4 and on SAG-AFTRA’s streaming bonus fund.
Our reading
For producers and sales agents, the line to watch is not adjusted OIBDA but programming spend. STARZ is improving its margin mainly by paying less for content and marketing, and by owning more of what it shows, not by growing revenue: streaming income rose by less than 2% year on year. That points to a buyer that will license selectively and prefers rights it can hold for longer.
The termination fee is a reminder that pay-TV output deals still carry box-office risk for the platform. A fee that moves with theatrical performance means STARZ’s costs depend in part on films it no longer intends to carry.
The next evidence is the fourth quarter. STARZ reiterated its outlook of a 20% adjusted OIBDA margin for the second half of 2027 and $100m to $120m of unlevered free cash flow in 2026. On our arithmetic, it needs roughly $15m to $35m more in the fourth quarter to land inside that range.