Lionsgate Reports Strong Revenue Growth and Narrowing Losses

Lionsgate released its financial results for the second quarter of fiscal 2027 on Thursday, revealing sharply higher overall revenues and a significantly narrowed net loss. The studio, led by CEO Jon Feltheimer, reported a net loss attributable to shareholders of $15.5 million, a substantial improvement from the $113.5 million loss recorded in the same period last year. This positive shift was underpinned by a 41 percent rise in overall studio revenue, which reached $668.8 million compared to $475.1 million in the prior year. These figures exceeded analyst expectations, which had projected overall revenues of $627.6 million for the quarter.

The company’s earnings per share loss also improved to 5 cents, down from a 39 cent loss a year earlier. Adjusted OIBDA for the period came in at $72 million. A primary driver of this financial performance was the studio’s film and television library, which generated $1.04 billion over the trailing 12 months. This figure represents the second-highest quarterly watermark for the library, which consists of a 20,000-title portfolio housing major franchises such as John Wick, The Hunger Games, and Twilight, alongside other high-value brands like La La Land and Dirty Dancing.

Feltheimer highlighted the diverse sources of growth within the library during an after-market call with analysts. He noted that while The Hunger Games franchise contributed significantly, other titles also played a crucial role. These included the long-running Canadian family drama Heartland and Quentin Tarantino’s Kill Bill: The Whole Bloody Affair. The studio is actively monetizing its intellectual property through various channels, including a recent licensing deal with Netflix for the first four series of the Power franchise. Additionally, live experiences are seeing increased activity, with the Dirty Dancing musical touring North America, a La La Land stage musical in development for a 2028 opening, and Now You See Me Live opening at the MGM Grand in Las Vegas.

The studio is also exploring new technological partnerships to expand its reach. Following a recent agreement to bring its latest Hunger Games film to Mark Zuckerberg’s Meta VR glasses after its theatrical run, Feltheimer indicated that further collaborations with the tech giant are in discussion. He expressed confidence that Meta could become a significant player in the content space, noting that the two parties are already discussing original programming ideas.

Feltheimer commented on the broader industry environment, describing it as showing encouraging signs. He pointed to the return of audiences to movie theaters and the stabilization of scripted TV series orders as positive indicators. He also noted that the completion of the Skydance acquisition of Warner Discovery has reduced uncertainty in the industry. Lionsgate, which operates as a standalone company after splitting from Starz, recently faced takeover speculation after reports that Legendary submitted an offer. While declining to address the speculation directly, Feltheimer stated that the company is well-positioned in a rapidly consolidating market.

The Motion Pictures division saw a rebound in performance, with segment revenue jumping 30 percent to $359.3 million from $276.4 million in the year-ago period. This growth was driven by the release of the biopic Michael and strong library revenue. Adam Fogelson, chair of the Motion Picture Group, reported that development on the Michael sequel is progressing well, with the full creative team in place. The studio has also begun preproduction on an animated John Wick prequel, which will feature Keanu Reeves and be directed by Shannon Tindle.

Feltheimer expressed confidence in the studio’s earnings power over the next three years, citing a slate that includes the new Hunger Games film, Resurrection of The Christ Parts 1 and 2, The Housemaid’s Secret, Michael 2, and an adaptation of the Naruto manga. The latter will see Sony Pictures serve as the international partner and co-financier. The TV production segment also performed strongly, with revenue rising 56 percent to $309.5 million due to higher episodic deliveries, including for The Hunting Wives and The Studio.

Profitability in the Motion Picture division improved significantly, with segment profit reaching $88.7 million compared to $30.5 million in the prior year. The TV production segment profit also increased to $21.6 million from $12.5 million. Kevin Beggs, Lionsgate TV Group chair and chief creative officer, noted that the division is doing significant business with the enlarged Paramount Skydance studio. Feltheimer echoed this sentiment, describing Paramount as a strong buyer and partner under CEO David Ellison.

Finally, COO Brian Goldsmith discussed the integration of artificial intelligence tools across the studio. He stated that the primary goal of these implementations is to improve efficiency and productivity throughout the organization. While specific cost savings were not detailed, Goldsmith emphasized the aim to maximize efficiency while creating the most commercial products possible.