Restructuring its media-network business -- which includes premium linear TV and streaming business -- midsize Hollywood studio Lionsgate took a $85.5 million impairment charge for its most recent reporting quarter.
This came as part of an “assessment” of its media networks' cost structure and content strategy.
This contributed to the studio's net loss of $96.8 million, and an operating loss of $49.6 million. The net loss was only slightly better than the year-ago period, when it was $104.6 million.
Company-wide revenue -- boosted from major theatrical hit “John Wick: Chapter 4” -- helped overall Lionsgate revenue rise 17% to $1.1 billion year-over-year -- above analysts' expectations.
Lionsgate stock closed down 2.4% on Thursday to $10.17. In after-market trading, the stock rose 2.3%.
Revenue for its media networks group -- headed up by U.S. premium cable TV network and streamer Starz Networks, and its international streaming business Lionsgate+ -- grew just 2.3% to $389 million in its latest quarter.
The company’s global streaming business grew 1.3 million subscribers in the period to 20.4 million.
In the U.S., Starz streaming subscribers grew 700,000 to 12.3 million. Its linear cable TV subscribers are now at 8 million in the U.S. -- down from 9.5 million a year ago.
Total global TV and streaming subscribers (Starz and Lionsgate+) now total 30.3 million -- down from the previous quarter (37.2 million) and from its year-ago period (35.8 million).
Lionsgate is moving forward with plans to spin off its streaming business, keeping its studio business intact.
The big plus for the company was with its TV/movie studio, with revenue rising 25% to $823.4 million -- driven largely by the success of “John Wick: Chapter 4” at the box office, coming in at $431 million worldwide.
During an earnings phone call, Kevin Beggs, chairman of Lionsgate Television Group, said all major streamers are now looking to make content and cost cutbacks -- in contrast to recent periods when the focus was creating as much programming as possible to fill out new streaming services.
Beggs said this means quickly ending mediocre-performing shows while boosting big high-profile series. “It’s a hit-driven business,” he said.
With regard to the writers' strike, the studio said early on that it had been producing extra TV and other content in preparation for the walkout.