Third Quarter 2026
Filed Oct 29, 2026STARZ Delivers Sequential and Year-over-Year OTT and Total Revenue Growth; Reaffirms All 2026 and 2027 Targets
Third-quarter OTT revenue and total revenue rose year-over-year, Adjusted OIBDA more than doubled, operating cash flow and free cash flow were positive, and management reiterated its 2026 and second-half 2027 targets. GAAP operating loss and net loss persisted, while net corporate debt increased from June 30, 2026.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| OTT revenue, three months ended September 30, 2026GAAP | $226.6M | – | – |
| Linear and other revenue, three months ended September 30, 2026GAAP | $95.8M | – | – |
| Total revenue, three months ended September 30, 2026GAAP | $322.4M | – | – |
| Programming amortization, three months ended September 30, 2026GAAP | $141.5M | – | – |
| Other operating expense, three months ended September 30, 2026GAAP | $37.5M | – | – |
| Advertising and marketing expense, three months ended September 30, 2026GAAP | $74.2M | – | – |
| General and administrative expense, three months ended September 30, 2026GAAP | $31.3M | – | – |
| Depreciation and amortization, three months ended September 30, 2026GAAP | $67.4M | – | – |
| Restructuring and other, three months ended September 30, 2026GAAP | −$8.3M | – | – |
| Total expenses, three months ended September 30, 2026GAAP | $343.6M | – | – |
| Operating loss, three months ended September 30, 2026GAAP | −$21.2M | – | – |
| Interest expense, three months ended September 30, 2026GAAP | −$14M | – | – |
| Interest and other income, three months ended September 30, 2026GAAP | $100K | – | – |
| Other expense, three months ended September 30, 2026GAAP | −$1.4M | – | – |
| Loss from continuing operations, three months ended September 30, 2026GAAP | −$36.5M | – | – |
| Income tax benefit (expense), three months ended September 30, 2026GAAP | $1.7M | – | – |
| Net loss from continuing operations, three months ended September 30, 2026GAAP | −$34.8M | – | – |
| Net loss, three months ended September 30, 2026GAAP | −$34.8M | – | – |
| Basic and diluted net loss per common share, three months ended September 30, 2026GAAP | $(2.02) | – | – |
| Weighted average common shares outstanding, basic, three months ended September 30, 2026GAAP | 17.2M | – | – |
| Weighted average common shares outstanding, diluted, three months ended September 30, 2026GAAP | 17.2M | – | – |
| Adjusted OIBDA, three months ended September 30, 2026non-GAAP | $44.2M | – | – |
| Net cash flows provided by operating activities, three months ended September 30, 2026GAAP | $18.9M | – | – |
| Capital expenditures, three months ended September 30, 2026GAAP | −$5.8M | – | – |
| Total Equity Free Cash Flow, three months ended September 30, 2026non-GAAP | $13.1M | – | – |
| Total Unlevered Free Cash Flow, three months ended September 30, 2026non-GAAP | $18.8M | – | – |
| Cash paid for programming content, three months ended September 30, 2026other | −$174.4M | – | – |
| OTT revenue, nine months ended September 30, 2026GAAP | $659M | – | – |
| Linear and other revenue, nine months ended September 30, 2026GAAP | $278.2M | – | – |
| Total revenue, nine months ended September 30, 2026GAAP | $937.2M | – | – |
| Operating loss, nine months ended September 30, 2026GAAP | −$349.5M | – | – |
| Net loss, nine months ended September 30, 2026GAAP | −$389.1M | – | – |
| Basic and diluted net loss per common share, nine months ended September 30, 2026GAAP | $(22.98) | – | – |
| Net cash flows provided by operating activities, nine months ended September 30, 2026GAAP | $63.9M | – | – |
| Capital expenditures, nine months ended September 30, 2026GAAP | −$15.5M | – | – |
| Net cash flows used in investing activities, nine months ended September 30, 2026GAAP | −$14.3M | – | – |
| Net cash flows provided by financing activities, nine months ended September 30, 2026GAAP | $1.5M | – | – |
| Net change in cash and cash equivalents, nine months ended September 30, 2026GAAP | $51.1M | – | – |
| Cash and cash equivalents, September 30, 2026GAAP | $86.8M | – | – |
| Total debt, September 30, 2026other | $687.5M | – | – |
| Net corporate debt, September 30, 2026non-GAAP | $600.7M | – | – |
| Adjusted OIBDA, trailing twelve months ended September 30, 2026non-GAAP | $217.6M | – | – |
| Adjusted OIBDA leverage ratio, September 30, 2026non-GAAP | 2.8x | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| OTT revenueThe release cited the continued strength of the business and a portfolio approach to programming driving a more durable revenue base. | $226.6M | – | – |
| Linear and other revenueThe filing cited continued declines in traditional linear services in its discussion of cost-saving initiatives and content rationalization. | $95.8M | – | – |
2026 outlook
- Revenuepositive year-over-year OTT revenue growth
- NoteAdjusted OIBDA outlook of mid-single-digit percentage growth
- NoteUnlevered Free Cash Flow outlook of $100 million to $120 million
- NoteAdjusted OIBDA Leverage Ratio outlook exiting 2026 to be approximately 2.7x
- Note20% Adjusted OIBDA Margin Outlook for the Second Half of 2027
What drove it
- OTT revenue was $226.6 million in the third quarter, compared with $222.8 million in the prior-year quarter.
- Programming amortization, other operating expense, and advertising and marketing expense were lower than in the prior-year quarter.
- The third quarter included a reduction of previously accrued contract termination fees and content recoveries, resulting in restructuring and other of $(8.3) million.
- Adjusted OIBDA was $44.2 million, compared with $21.8 million in the prior-year quarter.
- Management said increased ownership is beginning to unlock financial upside.
Concerns
- Linear and other revenue was $95.8 million, compared with $98.1 million in the prior-year quarter.
- The company reported an operating loss of $(21.2) million and net loss of $(34.8) million for the third quarter.
- General and administrative expense was $31.3 million, compared with $28.8 million in the prior-year quarter, while depreciation and amortization was $67.4 million, compared with $47.9 million.
- Net corporate debt increased to $600.7 million from $565.5 million at June 30, 2026.
- Total revenue for the nine months ended September 30, 2026 was $937.2 million, compared with $971.2 million in the prior-year period, while net loss was $(389.1) million compared with $(248.1) million.
What to watch
- Delivery of positive year-over-year OTT revenue growth in 2026.
- Delivery of mid-single-digit percentage Adjusted OIBDA growth in 2026.
- Delivery of $100 million to $120 million of Unlevered Free Cash Flow in 2026.
- Progress toward an approximately 2.7x Adjusted OIBDA Leverage Ratio exiting 2026.
- Progress toward the 20% Adjusted OIBDA Margin Outlook for the Second Half of 2027.
- The effect of programming contract termination fees, content recoveries, content impairments, and traditional linear-service declines on results.
Balance sheet and cash flow
- Cash and cash equivalents were $86.8 million as of September 30, 2026, compared with $35.7 million as of December 31, 2025.
- Total debt was $687.5 million, including a $362.4 million Term Loan A credit facility and $325.1 million in senior unsecured notes.
- The $183.0 million revolving credit facility remained fully undrawn.
- Net corporate debt was $600.7 million and the Adjusted OIBDA Leverage Ratio was 2.8x as of September 30, 2026.
- Net cash flows provided by operating activities were $18.9 million in the third quarter and $63.9 million for the nine months ended September 30, 2026.
- Capital expenditures were $(5.8) million in the third quarter and $(15.5) million for the nine months ended September 30, 2026.
Analysis
Starz reported third-quarter revenue of $322.4 million, compared with $320.9 million in the prior-year quarter. OTT revenue was $226.6 million versus $222.8 million, while linear and other revenue was $95.8 million versus $98.1 million. The company characterized both OTT revenue and total revenue as having grown sequentially and year-over-year. For the nine-month period, however, OTT revenue was $659.0 million compared with $669.4 million and total revenue was $937.2 million compared with $971.2 million.
Cost trends supported a marked improvement in third-quarter profitability. Programming amortization, other operating expense, and advertising and marketing expense each declined from the prior-year quarter. Restructuring and other was a $(8.3) million credit, versus $5.0 million of expense, reflecting a reduction of previously accrued contract termination fees and content recoveries. Operating loss narrowed to $(21.2) million from $(34.8) million, and Adjusted OIBDA rose to $44.2 million from $21.8 million. Net loss was $(34.8) million, compared with $(52.6) million.
Cash generation turned positive in the third quarter. Net cash flows provided by operating activities were $18.9 million, Total Equity Free Cash Flow was $13.1 million, and Total Unlevered Free Cash Flow was $18.8 million. For the nine months, operating cash flow was $63.9 million, compared with cash used in operating activities of $(24.2) million in the prior-year period. Cash paid for programming content was $(174.4) million in the third quarter, compared with $(159.7) million in the prior-year quarter.
The balance sheet held $86.8 million of cash and cash equivalents and $687.5 million of total debt at September 30, 2026. Net corporate debt was $600.7 million, compared with $565.5 million at June 30, 2026, while the Adjusted OIBDA leverage ratio improved to 2.8x from 2.9x. The $183.0 million revolving credit facility was fully undrawn. The company reiterated its 2026 targets for positive year-over-year OTT revenue growth, mid-single-digit percentage Adjusted OIBDA growth, $100 million to $120 million of Unlevered Free Cash Flow, and an approximately 2.7x exit leverage ratio.
Management also reiterated a 20% Adjusted OIBDA Margin Outlook for the Second Half of 2027. Execution against that plan will depend on OTT revenue performance, continued programming-cost discipline, the effects of contract termination and content-related items, and management of leverage amid continued declines in traditional linear services.
Management, verbatim
Our third-quarter results reflect the continued strength of the business and our focused execution against our four key financial priorities.
Jeffrey Hirsch, STARZ President and CEO
Our portfolio approach to programming is driving a more durable revenue base, and we are just beginning to unlock the financial upside of increased ownership.
Jeffrey Hirsch, STARZ President and CEO
We remain confident in our outlook and in our ability to continue delivering against our plan and create long-term value for our shareholders.
Jeffrey Hirsch, STARZ President and CEO
Not in the filing
stated, not guessed- Gross margin was not reported.
- Gross profit was not reported.
- No GAAP or non-GAAP operating margin was reported.
- No GAAP or non-GAAP tax rate was reported.
- No share repurchases, dividends, or other capital-return activity was reported.
- No prior outlook section was provided, so comparisons of actual results with prior guidance are unavailable.
- Sequential revenue figures were not printed on the revenue rows, despite the release stating that OTT revenue and total revenue grew sequentially.
- Percentage changes for revenue, expenses, income or loss, EPS, cash flow, and segment results were not printed on their respective rows.
- Quarterly cash-flow statement line items other than the KPI amounts were not reported.
- No subscriber, churn, ARPU, or other operating subscriber metrics were reported.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.