GET DAILY SIGNALSStarz Entertainment (STRZ) Shows Revenue Rebound and Sharply Higher Adjusted OIBDA
Key Takeaways
- Total revenue rose to $322.4 million, up from $320.9 million a year earlier, marking a return to sequential and year-over-year growth.
- OTT revenue (over-the-top streaming revenue) increased to $226.6 million, while the legacy linear segment continued a gradual decline to $95.8 million.
- Adjusted OIBDA (Operating Income Before Depreciation and Amortization) more than doubled year-over-year to $44.2 million, reflecting a tighter cost structure.
- The company reaffirmed all 2026 targets, including mid-single-digit Adjusted OIBDA growth and $100 million to $120 million of unlevered free cash flow.
- Net loss narrowed to $34.8 million, or $2.02 per share, from $52.6 million, or $3.15 per share, in the prior-year quarter.
- For additional detail on STRZ, visit the Major News, Today's Price Move, Price Targets, and Forecasts pages.
Earnings Context and Why It Matters
Starz Entertainment (STRZ) entered its third quarter of fiscal 2026 still working through a multi-year transformation following its separation from Lionsgate. The company has spent recent quarters rightsizing content costs, prioritizing higher-value streaming subscribers, and restructuring its programming slate to favor owned content. This report mattered because investors have been watching for evidence that the strategy is translating into durable revenue growth and improved cash generation, rather than simply narrower losses. With the stock having rallied sharply over the past year, the quarter served as a key test of whether management's operating improvements and deleveraging plan remain on track heading into the remainder of 2026. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Reported Results
For the third quarter ended September 30, 2026, Starz Entertainment reported total revenue of $322.4 million, up from $320.9 million in the prior-year period. OTT revenue rose to $226.6 million from $222.8 million, while linear and other revenue declined to $95.8 million from $98.1 million. Total revenue came in modestly ahead of the roughly $319 million consensus estimate.
The company reported a net loss of $34.8 million, or $2.02 per share, compared with a loss of $52.6 million, or $3.15 per share, a year earlier. The per-share result was wider than the consensus loss estimate of approximately $1.63, partly reflecting restructuring and content-related charges. Adjusted OIBDA more than doubled to $44.2 million from $21.8 million, while operating loss narrowed to $21.2 million from $34.8 million.
On the cash flow and balance sheet side, operating activities generated $18.9 million in cash, with unlevered free cash flow of $18.8 million and equity free cash flow of $13.1 million. Cash and equivalents stood at $86.8 million, total debt at $687.5 million, and the Adjusted OIBDA leverage ratio improved to 2.8x on a trailing-twelve-month basis. Management also reiterated its 2026 outlook and its 20% Adjusted OIBDA margin target for the second half of 2027.
Market Reaction and Investor Sentiment
Heading into the report, sentiment around Starz Entertainment had been improving as the company's cost discipline and subscriber economics strengthened. Analysts maintained a broadly constructive stance, with a consensus price target well above recent trading levels. The stock has been notably volatile around earnings in prior quarters, reflecting both the company's restructuring charges and its evolving streaming strategy. Following the release, investors focused on the combination of revenue growth, the significant jump in Adjusted OIBDA, and the reaffirmed full-year guidance, even as the wider-than-expected GAAP loss per share reflected ongoing one-time charges.
Forward Outlook and Key Factors to Monitor
Looking ahead, investors should monitor whether Starz can sustain the return to revenue growth while continuing to improve profitability. Management reiterated its expectation for positive year-over-year OTT revenue growth and mid-single-digit Adjusted OIBDA growth for 2026, along with $100 million to $120 million of unlevered free cash flow. From what I see, progress on owned content and revised licensing deals will be central to lowering costs over time.
A central theme will be the company's shift toward owned content and its revised licensing arrangements, which are intended to lower programming costs and improve long-term unit economics. Progress toward the 20% Adjusted OIBDA margin target in the second half of 2027 remains a key benchmark, as does further deleveraging toward the approximately 2.7x leverage target exiting 2026.
Other factors worth watching include subscriber churn and average revenue per user trends, the pace of content spending, and any additional restructuring or impairment charges tied to the declining linear business. The rollout of owned original programming will also be important, as it may influence both subscriber retention and content amortization going forward.
Using AI Tools in My Research
In my research process, I often turn to Tickeron’s AI Screener to compare STRZ against peers in the media sector. It helps quickly identify similar companies showing strong technical patterns or fundamental improvements. This tool has become a staple in my workflow for earnings reviews and helps surface ideas I might otherwise miss during busy reporting seasons.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
Momentum Indicator for STRZ turns negative, indicating new downward trend
STRZ saw its Momentum Indicator move below the 0 level on October 22, 2026. This is an indication that the stock could be shifting in to a new downward move. Traders may want to consider selling the stock or exploring put options. Tickeron's A.I.dvisor looked at 26 similar instances where the indicator turned negative. In 24 of the 26 cases, the stock moved further down in the following days. The odds of a decline are at 90%.
Technical Analysis (Indicators)
Bearish Trend Analysis
The Moving Average Convergence Divergence Histogram (MACD) for STRZ turned negative on October 23, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 14 similar instances when the indicator turned negative. In 11 of the 14 cases the stock turned lower in the days that followed. This puts the odds of success at 79%.
STRZ moved below its 50-day moving average on October 15, 2026 date and that indicates a change from an upward trend to a downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where STRZ declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 85%.
The Aroon Indicator for STRZ entered a downward trend on October 02, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Bullish Trend Analysis
The RSI Oscillator points to a transition from a downward trend to an upward trend -- in cases where STRZ's RSI Indicator exited the oversold zone, 4 of 6 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 67%.
The Stochastic Oscillator demonstrated that the ticker has stayed in the oversold zone for 2 days, which means it's wise to expect a price bounce in the near future.
Following a +7.60% 3-day Advance, the price is estimated to grow further. Considering data from situations where STRZ advanced for three days, in 72 of 87 cases, the price rose further within the following month. The odds of a continued upward trend are 83%.
STRZ may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Fundamental Analysis (Ratings)
The Tickeron PE Growth Rating for this company is 24 (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is 25 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 76, placing this stock better than average.
The Tickeron Valuation Rating of 28 (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.258) is normal, around the industry mean (12.534). P/E Ratio (-1.299) is within average values for comparable stocks, (38.830). Projected Growth (PEG Ratio) (0.050) is also within normal values, averaging (2.376). Dividend Yield (0.000) settles around the average of (0.045) among similar stocks. P/S Ratio (0.333) is also within normal values, averaging (2.932).
The Tickeron Price Growth Rating for this company is 42 (best 1 - 100 worst), indicating steady price growth. STRZ’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is 98 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
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