Lionsgate’s revenues fell during the most recent fiscal quarter, as the media company behind the “Hunger Games” and “John Wick” franchises recorded a loss of $13.9 million.
The company did manage to beat Wall Street’s expectations, however, with its earnings bolstered by the growing popularity of its Starz service and through lucrative licensing deals for its older films and television shows. Revenues for the period ending in December topped out at $836.4 million, a 16.2% decline. Lionsgate also recorded net losses of 6 cents per share and adjusted earnings of 21 cents per share.
Analysts had expected Lionsgate to report $776.5 million in revenue, a loss of 11 cents per share, and adjusted earnings per share 21 cents.
Lionsgate also improved its cash position, an important metric during a time when COVID-19 has upended the entertainment business, making film production more expensive and shuttering many movie theaters. Lionsgate said it had $551.5 million in cash and cash equivalents, up from $318.2 million in the year-ago period.
“One full year into the pandemic, our businesses are doing well, adapting to the changes, overcoming the headwinds, and delivering a strong financial performance while creating evergreen value for the future,” Lionsgate CEO Jon Feltheimer said during an earnings calls with analysts. “We owe much of this success to the amazing resilience of our employees and our creative talent family, who have doubled down on their collaborative team spirit, innovated new ways of working and communicating, and demonstrated strength and resourcefulness in the face of adversity.”
Lionsgate’s media segment revenue, which includes the money it earns from its Starz streaming service, rose 6% to $406.2 million, which the company attributed to subscriber growth. Profits for the segment did fall 20% to $81.7 million due to more investment in content and increased marketing spending.
Lionsgate’s motion picture segment revenue fell by more than half to $250.3 million, a reflection of the dearth of theatrical releases in the quarter. Profits stayed roughly flat at $50 million. Feltheimer said that five feature films have returned to production. The company is ready to shoot “White Bird,” a sequel to “Wonder,” as well as “Borderlands” with Kevin Hart and Cate Blanchett and a fourth “John Wick.”
The company’s television production segment revenue increased 20.5% from the prior year quarter at $228.2 million, with profits swinging from a loss of $5.7 million to $29.5 million. Lionsgate said the growth was due to higher profits from library content. In fact, Lionsgate’s library was a particular source of strength with revenue of $765 million for its second best quarter ever.
Investors seemed to respond positively to the report with Lionsgate’s shares rising in value in after hours trading.