Lionsgate Ups Q3 Motion Picture Segment Profit; Streaming Video Costs
February 6, 2020
Liongate’s motion picture group, which includes home entertainment, Feb. 6 reported third-quarter (ended Dec. 31, 2019) operating income of $49 million, which was up 12.5% from operating income of $43.5 million in the previous-year period.
Revenue increased 30% to $474 million from $362.6 million during the previous-year period. The studio attributed much of the gain to the box office success Knives Out, which is expected to top $300 million at the worldwide box office, as well as the continued outsized ancillary home entertainment performance of John Wick: Chapter 3 — Parabellum.
Knives Out, which features an ensemble cast, has generated more than $294 million at the global box office since launching Nov. 27, 2019.
Separately, Keanu Reeves actioner, John Wick: Chapter 3 — Parabellum, finished 2019 as the ninth best-selling DVD/Blu-ray Disc release according to VideoScan tracking data.
“Our Motion Picture Group turned in a strong performance in the quarter,” CEO Jon Feltheimer said in a statement.
At the same time, Lionsgate continues to push over-the-top video distribution — specifically Starz and StarzPlay internationally. The streaming services ended the period with more than 8.6 million subscribers. The company has projected StarzPlay international subscriber growth from 15 million to 25 million over the next five years.
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The legacy pay-TV businesses Starz, StarzPlay Arabia and Pantaya reached 28.5 million subs in the quarter. The overall global total reflected an increase of 2.1 million subscribers, up 8% year-over-year. Total domestic Starz subs declined 1.2 million year-over-year to 24.1 million.
Rollout of StarzPlay International and Starz OTT continue to balloon costs and negatively impact the bottom line. StarzPlay posted a segment operating loss of nearly $40 million, while streaming services lost $9.8 million. Both units lost a combined $5.8 million in the previous-year period.