Starz Entertainment Corp.

Second-quarter 2026 total revenue was $308 million. OTT revenue was $221 million, with year-over-year growth for the first time since Q4 2024; on a pro forma basis excluding $3 million of Canada-related OTT revenue in Q2 2025, OTT revenue would have increased 1.4%. Linear and other revenue was $87 million. Adjusted OIBDA was $60 million. Unlevered free cash flow was negative $15 million in the quarter and positive $66 million year-to-date; equity free cash flow was negative $33 million in the quarter and positive $35 million year-to-date. Cash content spend was $182 million, net debt was $566 million as of June 30, 2026, and adjusted OIBDA leverage was 2.9x. Guidance was raised: 2026 adjusted OIBDA growth now expected to be mid-single digits, and unlevered free cash flow is now expected in the mid- to upper-end of the prior $80 million to $120 million range. Management said Q3 adjusted OIBDA should be in the mid-30s, Q4 should be in the mid-60s, full-year cash content spend should come in below $600 million, and year-end leverage is expected to be about 2.7x after a planned $100 million increase to credit facilities. The company also reiterated a 20% adjusted OIBDA margin target in the back half of 2027 and said it remains confident in a path to 2.5x leverage and below.

Jeffrey Hirsch framed the quarter as evidence that STARZ is entering the back half of 2026 with momentum, citing stronger engagement, improving OTT revenue, and early success from Fightland. He emphasized that the company is building a larger owned-content pipeline, using franchises like Power and Outlander to drive recurring audience behavior, and expanding distribution through bundled partnerships rather than heavy platform investment. His tone was confident and strategic, with repeated references to a clearer path toward higher margins, deleveraging, and a more significant 2026 inflection than previously expected.

Scott MacDonald focused on the financial improvement: $308 million of total revenue, $221 million of OTT revenue, $60 million of adjusted OIBDA, and positive year-to-date free cash flow despite a negative Q2. He raised full-year 2026 adjusted OIBDA growth guidance to mid-single digits and unlevered free cash flow guidance to the mid- to upper-end of $80 million to $120 million, while saying cash content spend should be below $600 million for the year. He also highlighted $566 million of net debt, 2.9x leverage, a planned $100 million increase in credit facilities to refinance higher-cost programming notes, and an expected roughly $4 million annual free cash flow benefit from lower interest expense.

Analysts pressed on Fightland’s launch, asking about customer acquisition, overlap with the Power universe, and whether it is drawing lapsed users back; management said it is the second-best premiere of new IP in STARZ history, with strong social sentiment and win-backs. They also asked about the Netflix licensing deal for the original Power series, and STARZ said the move should introduce the franchise to new audiences while the company remains the exclusive home of the Power Universe sequels, prequels, and spinoffs. Other questions focused on pricing power, bundling, and capital allocation; management said the latest rate increase has been absorbed well with record-low churn, more partnerships are likely, and buybacks/M&A are not a focus until leverage moves closer to the target range.