Starz's Third Quarter 2025 Results: A Tale of Streaming Wins and Widened Losses

Starz just dropped its Q3 2025 financials, and it's a bit of a head-scratcher: strong streaming growth and a Canadian comeback, yet revenue is down and net losses are wider than ever. Let's break down what's really happening.

TL;DR: Key Takeaways from Starz's Q3 Report

• Starz saw a significant boost in US streaming subscribers (up 110,000) and a substantial rebound in Canadian subs (up 250,000), mainly due to a resolved carriage dispute.
• Despite subscriber gains, the company's overall revenue fell to $320.9 million, and its net loss widened to $52.6 million, missing Wall Street expectations.
• The company is making strategic shifts, including transitioning its Canadian business to a content licensing model, co-commissioning original series like Fightland, and eyeing M&A opportunities to expand its core audience.

Unpacking the Mixed Bag of Starz's Financial Performance

Imagine hitting a home run but then tripping on your way to first base. That's a bit how Starz's third quarter of 2025 feels. The premium network, now operating as a standalone public company after splitting from Lionsgate, announced its latest financial results, revealing a complex picture of growth in some areas and significant challenges in others. While the streaming side shows undeniable momentum, the overall financial health presents a more daunting climb.

Overall, Starz's revenue for the quarter fell to $320.9 million, a noticeable dip from the $347 million reported in the same period last year. This revenue decline coincided with a widened operating loss of $34.8 million (compared to $17 million a year ago) and a net loss of $52.6 million, which is significantly higher than the $30.6 million loss from the prior year. Essentially, the company spent more and earned less in total, leading to deeper financial losses than anticipated by analysts. (Source: The Hollywood Reporter, November 13, 2025)

Streaming's Silver Lining: Subscriber Growth Amidst Industry Headwinds

However, dig a little deeper, and you'll find a clear bright spot: streaming subscribers. The company's over-the-top (OTT) service in the U.S. added a solid 110,000 customers in Q3, bringing its total to 12.29 million. This is particularly encouraging given that Starz had actually shed 120,000 customers in the previous quarter, showing a strong turnaround in its digital acquisition strategy. Year-to-date, US OTT subscribers have grown by 520,000, and by 670,000 year-over-year, indicating a sustained positive trend for its direct-to-consumer platform. (Source: PR Newswire, November 13, 2025)

This streaming growth isn't just about numbers; engagement on the STARZ app itself hit a 12-month high during this period. Shows like the Outlander spinoff, Blood of my Blood, and the premiere of Ballerina are credited with driving this increased viewership. This suggests that Starz's investment in its original content slate, especially titles that resonate with its core audience, is paying off in terms of user activity and retention.

The Canadian Comeback and the Continuing Linear Decline

While U.S. streaming was on the upswing, the overall U.S. subscriber count actually saw a slight dip, decreasing by 130,000 to 17.46 million. This decline was largely driven by the ongoing trend of "cord-cutting," as traditional linear TV subscribers continued to shrink. Linear subscribers in the U.S. fell by 240,000 to 5.17 million, highlighting the persistent challenge facing all traditional cable channels. (Source: The Wrap, November 13, 2025)

Curiously, total North American subscribers told a different story, growing by 120,000 to 19.2 million. The hero of this particular subplot was Canada, where Starz added a robust 250,000 subscribers, reaching 1.74 million. This impressive surge wasn't purely organic growth, though. It stemmed from the resolution of a carriage dispute, which reinstated linear subscribers who had previously been removed from Starz's count. While a win, it's important to differentiate this one-off recovery from consistent, organic growth drivers. Canadian OTT subscribers, for instance, remained flat at 68,000. (Source: PR Newswire, November 13, 2025)

The CEO's Optimistic Viewpoint and Strategic Shifts

"STARZ reported a great quarter both operationally and financially, and we expect to continue our momentum to close out 2025. It's been just six months since we became a standalone public company, and we are set to deliver on our post-separation plan of generating new revenue through content licensing and getting more ownership of series on the network at improved economics." — Jeffrey Hirsch, President & CEO, Starz (Source: The Hollywood Reporter, November 13, 2025)

Starz President and CEO Jeffrey Hirsch, in a statement accompanying the results, expressed confidence, emphasizing the company's post-separation plan. He noted that Starz is focused on creating new revenue streams through content licensing and gaining more ownership of its original series, aiming for improved financial returns. He believes this strategy will allow the company to further scale its core audience of women and underrepresented groups, ultimately delivering significant value for shareholders.

Hirsch's optimism extends to the company's future outlook for 2025, expecting continued U.S. OTT subscriber growth in the fourth quarter and projecting approximately $200 million in adjusted operating income by year-end. This forward-looking view suggests that while the current financial numbers are challenging, the underlying strategic moves are designed to set Starz on a more profitable path in the long term.

Redefining International Strategy and Content Ownership

One of the most significant structural changes outlined by Hirsch involves Starz's Canadian operations. The company is transitioning from a complex joint venture model with Bell Canada to a simpler content licensing agreement. This means Bell will take on full operational responsibility for the Starz-branded service in Canada, while Starz will generate international licensing revenue without the direct overhead of operating the service. This move is consistent with Starz's goal of "owning our content and creating incremental licensing revenue without the need to operate international services directly." (Source: The Wrap, November 13, 2025)

Similarly, Starz is actively pursuing co-commissioning deals for its original content. For instance, the company is in the late stages of securing a co-commissioning partner for Fightland, an upcoming series from Curtis "50 Cent" Jackson, which is already in production in London. This partnership is designed to improve the series' economics by lowering the per-episode cost for Starz and generating additional international revenue. This approach could potentially extend to other Starz-owned originals, allowing them to stretch their content investment further.

Ambitions for M&A: Targeting "Marooned" Linear Brands

Beyond content strategy, Starz is also looking to capitalize on potential merger and acquisition (M&A) opportunities within the evolving media landscape. CEO Hirsch expressed interest in acquiring or partnering with "marooned" linear brands – essentially, traditional cable networks struggling to adapt to the digital age. Starz believes its "industry-leading tech stack" can help these brands transition to digital, leveraging its existing platform to boost subscriber and revenue growth. (Source: The Wrap, November 13, 2025)

For example, imagine a niche linear cable channel with a loyal but aging audience. Starz could acquire it, use its digital infrastructure to create a new streaming hub for that content, and cross-promote it to its existing subscribers. This could introduce new audiences to the acquired brand and potentially reduce churn for Starz by offering a broader, complementary content library within its ecosystem.

However, this ambition comes with a clear limitation: Starz won't pursue deals that would place "an incredible amount of leverage" on the business. The company ended the quarter with $588.1 million in net debt and a leverage ratio of 3.4 times its adjusted operating income before depreciation and amortization (OIBDA). While they aim to reduce this to 2.6x as quickly as possible, any M&A move would need to align with strict financial prudence. (Source: The Wrap, November 13, 2025)

The Road Ahead: Content Slate and Financial Focus

Looking to the immediate future, Starz has an exciting slate of originals planned, which will be crucial for retaining and attracting subscribers. These include the highly anticipated Season 3 of Power: Force and Spartacus: House of Ashur in Q4 2025, followed by the final season of Outlander, Power Book III: Raising Kanan, the premiere of Fightland, Blood of My Blood Season 2, and P-Valley Season 3. (Source: The Wrap, November 13, 2025)

Financially, the company expects to decrease its investment in content year-over-year, with cash content spend projected to be just under $700 million in 2026, further dropping to $600-$650 million in the subsequent years. This controlled spending, combined with strategic content licensing and M&A, aims to drive improved free cash flow and achieve a goal of 20% margins by the end of 2028. It's a careful balancing act: investing enough in quality content to grow subscribers while simultaneously reining in costs to improve profitability.

Counterpoints to Consider in Starz's Journey

While Jeffrey Hirsch paints an optimistic picture, it’s fair to acknowledge the inherent challenges. The widened net loss and declining linear revenue are tangible setbacks, even if OTT growth offers a glimmer of hope. It highlights a common struggle in the media industry: converting digital subscriber growth into immediate, robust profitability, especially when traditional revenue streams are shrinking fast.

Another point to consider is the nature of the Canadian subscriber growth. While 250,000 new subscribers is a fantastic headline number, much of it stemmed from reinstating existing linear customers after a carriage dispute was resolved, rather than attracting entirely new, organic sign-ups. While valuable, this kind of gain isn't repeatable in the same way that consistent, app-driven streaming growth might be. Starz's ability to truly leverage these reinstated Canadian users into long-term, digitally-engaged subscribers will be the real test.

Frequently Asked Questions About Starz What were Starz's key financial results for Q3 2025? Starz reported a consolidated revenue of $320.9 million, an operating loss of $34.8 million, and a net loss of $52.6 million. These figures indicate a decline in revenue and widened losses compared to the previous year. How did Starz's subscriber numbers change in Q3 2025? U.S. Over-The-Top (OTT) subscribers increased by 110,000 to 12.29 million. Total U.S. subscribers, however, decreased by 130,000 due to linear cord-cutting. Total North American subscribers (including Canada) saw an increase of 120,000 to 19.2 million, largely driven by a 250,000 subscriber gain in Canada due to a resolved carriage dispute. What is Starz's strategy for content and international markets? Starz plans to generate new revenue through content licensing, reduce content investment over time (e.g., aiming for under $700 million in cash content spend in 2026), and pursue co-commissioning deals for original series. In Canada, they are shifting from a joint venture to a content licensing agreement, with Bell Canada assuming operational responsibility. Is Starz looking into mergers and acquisitions (M&A)? Yes, CEO Jeffrey Hirsch indicated Starz is open to M&A opportunities, particularly targeting "marooned" linear brands to help them transition to digital using Starz's tech platform. However, any deal would be contingent on not adding excessive leverage to the company's existing debt load.

Practical Takeaways for Viewers and the Industry

• Expect More Strategic Content Partnerships: Starz is keen on co-commissioning and licensing, meaning more varied international content might find its way to the platform, potentially enhancing content diversity.
• The App Experience is Key: With engagement hitting a 12-month high, Starz is clearly investing in its digital platform. If you're a subscriber, expect continued focus on user experience and app performance.
• A Focus on Core Audiences: Starz continues to target women and underrepresented audiences. This focus means their content slate will likely remain tailored to these demographics, offering specialized programming.
• Watch for Industry Consolidation: Starz's interest in "marooned" linear brands points to potential shake-ups in the wider streaming and TV landscape. This could mean new channel offerings or content libraries might eventually merge into platforms like Starz.
• Linear TV Continues Its Decline: The significant drop in U.S. linear subscribers for Starz underscores the ongoing shift in how people consume media, pushing platforms further into digital-first strategies.

Sources:

• Etan Vlessing, "Starz Releases Q3 Financials Amid Lionsgate Split, Widened Losses," The Hollywood Reporter, November 13, 2025.
• "Starz Entertainment Corp. Reports Strong Subscriber Growth Amid Q3 Financial Results," TipRanks Canadian Auto-Generated Newsdesk, November 13, 2025.
• "Starz Entertainment Corp. Reports Results for the Third Quarter Ended September 30, 2025," PR Newswire, November 13, 2025.
• Lucas Manfredi, "Starz Q3 Loss Widens to $53 Million," The Wrap, November 13, 2025.