• by Wayne Friedman , May 25, 2018

While TV production revenues witnessed gains in the latest quarterly reporting period, Lionsgate sank by double-digit percentages, due to a smaller theatrical slate.

The company also had some subscriber losses for cable network group Starz.

Overall revenues for its fiscal fourth-quarter period sank 17% to $1.04 billion, with net income up $89.5 million from $61.5 million in the year-ago period.

Analysts say overall results were better than expected. Mid-morning Friday trading of its stock was up 3.5% to $24.15.

Motion picture revenue was down 35% to $425 million, while TV revenue gained 4% to $253 million and with media networks slipped 1% to $371 million. Lionsgate says already contracted future revenue on the licensing of film and television content -- not yet recorded -- was $1.2 billion as of March 31, 2018.

Lionsgate looks to continue new growth from media networks -- especially its Starz OTT business. The company reports a 101% increase in OTT subscribers in its just-completed fiscal year.

But overall, questions remain, says Todd Juenger, senior media analysts at Bernstein Research, especially when it comes to the Starz traditional cable TV network business.

“Despite that good news [on OTT], total Starz subscribers declined sequentially (500,000 ) and year-to-year (700,000). ... If the OTT business had strong ‘adds’ and low churn, clearly the traditional MVPD business isn't doing so well, at least on subscribers. So is the takeaway on subs good or bad?” asks Juenger.

John Janedis, media analyst at Jefferies, estimates Starz dropped around 700,000 traditional cable network subscribers for the year, ending with a total of 23.5 million.

Some of this was due to the impact from cable operator Altice USA; Starz was blacked out on the pay TV provider for six weeks. The companies inked a new multiyear deal in February.

Janedis says there are also fewer subscribers, due to AT&T's shift from its telco service U-Verse and toward DirecTV.

Still, he says: “With Starz OTT launching on YouTube next month and Hulu in October, as well as more moderate trad subcribers losses, we expect total sub growth in fiscal 2019 to 24 million."