November 3, 2022
Lionsgate Nov. 3 revealed it is exiting the Lionsgate+ (formerly Starzplay International) branded international streaming business in select markets, which include operations in France, Germany, Italy, Spain, Benelux, the Nordics and Japan. The move resulted in a $218.9 million restructuring charge in the second quarter (ended Sept. 30), primarily driven by content impairment write-downs in the affected territories.
The company also recorded $1.48 billion non-cash impairment charge related to goodwill from the Starz acquisition in 2016. The digital platform, which Lionsgate paid $4.4 billion for, continues to be part of the media company’s digital strategy, including possible spin-offs of the Starz and studio business to third parties.
Lionsgate+ reported an operating loss of $44 million on revenue of $38.6 million. Starz Networks reported operating income of $65 million on revenue of $396.1 million. That’s up from operating income of $52 million on revenue of $384.7 million during the previous-year period.
The company’s global subscriber base increased to 37.8 million in Q2, including StarzPlay Arabia, a non-consolidated equity method investee, driven by growth in both international and domestic streaming subscribers. Global streaming subscribers increased 52% year-over-year to 27.3 million. Lionsgate+ subscribers grew 97% year-over-year to 14.8 million (including Lionsgate Play in India & South Asia).
“Economic and industry headwinds are having the greatest impact at Starz, where we are exiting seven international territories,” CEO Jon Feltheimer said in a statement. “This will allow us to streamline Starz international business and return it to profitability more quickly, while continuing to build on the opportunities created by a strong original series slate and focused content strategy domestically.”