Good afternoon, and welcome to the Lionsgate Studios 4th Quarter 2026 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key, followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then 1 on your telephone keypad. To withdraw your question, please press star, then 2. Please note, this event is being recorded. I would now like to turn the conference over to Neelay Shah, Head of Investor Relations. Please go ahead.

Good afternoon. Thank you for joining us for the Lionsgate Studios Corporation's Fiscal 2026 Fourth Quarter Conference Call. We'll begin with opening remarks from our CEO, John Feldheimer, followed by remarks from our CFO, Jimmy Barge. After their remarks, we'll open the call for questions. Also joining us on the call today are Vice Chairman Michael Burns, COO Brian Goldsmith, Chairman of the TV Group Kevin Beggs, Chairman of the Motion Picture Group Adam Fogelson, Chief Revenue Officer Jim Packer, and Senior Advisor to the Office of the CEO at Lionsgate and Co-CEO of Three Arts, Brian Weinstein. The matters discussed on the call also include forward-looking statements, including those regarding the performance of future fiscal years. Such statements are subject to a number of risks and uncertainties. Actual results could differ materially and adversely from those described in the forward-looking statements as a result of various factors. This includes the risk factors set forth in our public filings for Lionsgate Studios Corp. The company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect any future events or circumstances. I'll now turn the call over to John.

Thank you, Neelay, and good afternoon, everyone. We just reported a quarter that is indicative of our earnings power, paving the way for outsized growth in fiscal 27 and 28. Since this is our fiscal year-end call, I'm going to take you through some of the highlights during the year. Last May, we completed the separation of Lionsgate and STARS into two standalone public companies, collapsing our dual-share structure into a single class of stock. The market's response confirms that a focused, content-driven Lionsgate is the right structure for unlocking value. We've put together one of the strongest content pipelines we've ever had. Over the next two to three years, over half of our film, television, and live entertainment slates will be comprised of branded, repeatable intellectual properties that we own or control. We secured renewals for 12 of our 13 scripted series, setting the stage for our television slate to nearly double the number of episodic deliveries from Fiscal 26 to Fiscal 27. We reported our third consecutive quarter of $1 billion trailing 12-month library revenue, creating valuable consistency in a constantly changing operating environment. We leaned into AI with a strategy designed to make technology a valuable part of the creative process and a driver of quality and efficiency across every part of our business. And we ended fiscal 26 and started fiscal 27 with two massively successful movies, The Housemaid and Michael, reasserting our brand and demonstrating our ability to compete effectively at every level of box office. The Housemaid reinforces our unique model and entrepreneurial approach, a provocative movie, an unconventional release strategy, a risk-mitigated financial structure with significant upside, and one of the highest box office to ancillary market conversion rates in the industry. We're excited to begin production later this year on The Housemaid's Secret, based on the best-selling second book in the trilogy for a December 17th, 2027 release. During the quarter, we took a number of other steps to keep this momentum growing, kicking off the marketing campaign for the next installment of our Hunger Games franchise, wrapping production on a new interpretation of Rambo with rising star Noah Centineo, wrapping production on Mel Gibson's Resurrection of the Christ Parts 1 and 2, greenlighting the reimagining of Blair Witch in partnership with Blumhouse and James Wan's Atomic Monster, and signing acclaimed Spider-Man director Sam Raimi to direct a remake of the classic horror-thriller Magic. After the quarter, we open Michael. The scenes of moviegoers dressing up, bringing their families over and over, and dancing in the aisles are a testament to what entertainment at its very best can do. With Japan still to open, Michael is on track to become our first movie grossing over a billion dollars at the worldwide box office. And we believe there is a lot more story to tell, and a lot more music to share. Turning to television, the mantra remains the same, lean into the creative strengths that enabled us to secure renewals of scripted TV series with 12 different buyers, keep costs down and maintain our flexibility to make shows at every price point for every buyer and across a balanced mix of retained rights and cost-plus models. The Rookie, our long-running procedural at ABC and Hulu, showed no signs of slowing down in the quarter, coming off a Season 8 finale that set a new streaming viewership record for the series and benefiting from an influx of younger audiences, the show was renewed for its ninth season. And we're excited to extend the brand with the ABC pickup of the Rookie North with potential breakout star Jay Ellis. No discussion of our television business would be complete without a few words about the hit comedy, The Studio, on Apple TV. The series just took the international category at the BAFTA Awards to complete one of the most dominant award runs in modern television history by winning the top prizes at the Emmys, Golden Globes, the Actor Awards, and the PGA, DGA, and WGA Awards. We're so proud of Seth Rogen, Evan Goldberg, the amazing cast and writers, together with our partners at Apple TV, for everything they have and are continuing to accomplish. In closing, our success in the quarter is about more than one hit movie. We're beginning to see signs that our operating environment is improving, people are returning to theaters, IMAX, Dolby, XD, and other premium large format screens are transforming the movie-going experience. Great storytelling is emerging in new and unexpected places across traditional and digital media alike. And Gen Z audiences are enabling shows like The Rookie to break out with renewed vitality as we're again seeing the resilience of our business in the largest entertainment market in the world. In this improving environment, the fact that our content pipelines are strong, our library is robust, our brand stands out and our franchises are adding value from new markets and new audiences should give everyone confidence in a strong year ahead. In the coming weeks, we'll post several slides on our investor site that illustrate the core tenets of our business that I've touched on throughout my remarks. The proportion of repeatable branded properties on our film and television slates, the strength and consistent performance of our library, and the uniqueness of our business models. I encourage you to take a look because we'll be returning to these themes often on future calls. Now I'll turn things over to Jimmy.

Thanks, John, and good afternoon, everyone. I'll briefly discuss our fiscal fourth quarter 2026 studio financial results and provide an update on the balance sheet. Beginning with the quarter, Lionsgate Studios' revenue was expectedly down year-over-year to $907 million, while adjusted OEBIDA reached a 12-year high of $165 million and was up 17% year-over-year. Operating income of $118 million was up over 50% compared to last year. Reported diluted earnings per share was $0.23 per share, and diluted adjusted earnings per share with 37 cents per share. Free cash flow for the quarter was a strong positive $190 million reflecting improved operating performance in the period as cash returns on our content investments in library were on full display. Trailing 12 months library revenue remained above $1 billion for yet another quarter, growing 5% year over year and continuing to demonstrate the durability and growing value of our content portfolio. Now breaking down the performance in the quarter, I'll start with the discussion of our studio segment profit. Studio segment profit, which reflects our motion picture and television segment profits before corporate overhead expense, increased 24% year-over-year to $218 million. We began highlighting our studio segment profit last quarter because this metric is generally more comparable to the studio-adjusted OEBIDO figures reported by many of our peers. The increase in studio segment profit was driven primarily by strong motion picture performance. Moving to motion picture, revenue increased 23% year-over-year to $652 million while segment profit grew 39% to $187 million. The quarter was driven primarily by the outstanding performance of the housemaid and continued carryover from Now You See Me, Now You Don't. Particularly noteworthy was the housemaid's strong carryover into the home entertainment window where it became the industry's highest gross in P-Vod title among films with up to $150 million of domestic box office. Additionally, motion picture's results were particularly impressive given we leaned in heavily near the end of the quarter with incremental pre-release P&A spend for Michael as well as early P&A spend for Hunger Games, Sunrise on the Reaping, and John Rambo. Turning to television, revenue was $255 million and segment profit was $31 million. television's year-over-year comparisons continue to reflect the timing of episodic deliveries and lower volume of scripted deliveries versus the prior year television segment profit remained resilient benefiting from continued strength in library performance including the rookie and mad man importantly we remain confident in tv's growth in fiscal 2027 as we expect to double the number of episodic scripted deliveries versus fiscal 2026. Now turning to the balance sheet. This quarter marks a post-spend inflection point for strengthening our balance sheet as trailing 12-month adjusted oebitah and free cash flow benefit from fully replenished pipelines in motion picture and television. We ended the fiscal year with net debt of approximately $1.6 billion and improvement of nearly $150 million relative to the prior quarter, driven by strong free cash flow. Year-end leverage improved well over a full turn to 6.1 times, reflecting both higher trailing 12-month adjusted hoibata and strength in free cash flow. At quarter in, we had approximately $800 million of unused capacity on our revolver available and $341 million of unrestricted cash on the balance sheet. Now let's discuss how the business is positioned going forward. Our first year as a standalone company was a transition year and we have all the pieces in place to enter Fiscal 2027 with a lot of momentum. In particular, we enter the year with strong carryover contribution from our Fiscal 2026 theatrical slate. In addition to starting the year with the exceptional performance of Michael, we have a highly anticipated motion picture release schedule and a large increase in scripted episodic deliveries within television. We now have enhanced visibility and continue to expect significant adjusted OEBDI growth in fiscal 2027. Additionally, this adjusted OEBDI improvement is expected to result in substantial growth in free cash flow and a continuation of significant deleveraging over the course of the year. Now I'd like to turn

the call over to Nilay for Q&A. Open the line up for Q&A. We will now begin the question and answer

session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. The first question today comes from Vikram Kasavabotla with Baird.

please go ahead yeah hey thank you for taking the questions um my first one is a higher level question on the industry and you reference this a little bit in your prepared remarks but it seems like the box office has been in a really good place over the past few months and i'm curious to hear your perspective on the drivers behind those trends and in particular i'm curious if you think we're seeing a sustainable improvement in consumer demand at the box office or if you think it's too early to make that characterization and i realize that's a tough question to unpack with a lot of precision but it'd be great to hear your perspective on the trends that you're observing out there um and then separate from that jimmy i'm curious if you could just talk more about what the cadence of fiscal 27 is going to look like from a profit perspective it seems like there's some moving pieces to consider you know relative to fiscal 26 uh you called out a few of those remarks would be great if you could just talk more about some of the the puts and

takes we should be taking into consideration thanks yeah thanks uh i'll i'll start and i I think I'll turn it over to one thing that I think is sort of an interesting is that YouTube growth is actually being driven by a 55-plus going businesses share of that market. And so that's obviously, that's the group that we want to engage with right now. We're finding different ways to reach them. But overall, that's very exciting. that coupled with formats that are actually making the movie going experience really like the lie what's going on of an event, especially if you've got an event.

A couple of years of by studios across the board. And I think there is much more content on the release schedule over the course of the next year and beyond that I think is going to continue to drive that type of attendance. It's really exciting to see and I'm without movies and going to the movie theaters as an incredibly fun way to spend time with their friend. The question, the exit polls reflect what John said, which is that group is driving real outsized opportunity alongside groups. Yeah, and thanks, Vikram. For sure, we've got,

you know, great visibility and confidence as we look at significant growth rolling into 27. From a cadence standpoint, I would say that it's not as back-end loaded as it was in the prior year, so not as back-end loaded as fiscal 26. TV is a little bit more back-end loaded this year than motion picture. And to give you some color, part of that visibility, right, is we're doubling episodic deliveries going into fiscal 27. You saw we had 12 of 13 returning series renewed. So of that, about 90% of four, that's just normal YITB would be a little bit more back-end loaded

in that context. Okay, great. Thank you. The next question is from David Joyce with

Seaport Research Partners. Please go ahead. Thank you. A couple questions. First, it was a great exit to 2026, great start to 27, but could you put a little finer point on the possible range of outcomes for the next year? Really, what does strong growth and significant growth mean, given that you are also laying the groundwork on sequels and some other films coming out? And I'll have a follow-up, please.

Thanks, David. Appreciate it. Yeah, I mean, ability in fiscal 27, as you would expect, as we're a bit closer. But it's still early in the year. I mean, we've got to remind you, right, there's timing and release schedules, both on our film slate, ultimately episodic deliveries, even the cadence of P&A spend, right? So we're not going to put a range on that for you. But, you know, we've got great carryover coming out of the 26th slate. You know that. I mean, Housemaid's written all over that. Obviously, a great start to the year in terms of theatrical slate with Michael, but also great things to come, as well as Hunger Grains and beyond. So, and the TV episodic deliveries, I've already kind of provided some color there. I'd also point you, I mean, I think it helps with the confidence and maybe doesn't help you with the range, but, you know, the backlog, which is contractual future revenues and cash flows, is, you know, a billion three. So, you know, that likewise gives us a lot of confidence, and probably 90% of that backlog will come within the next 24 months. So it's not only strong carryover into 27, but also fiscal 28 is also nicely set up as well. So thank you.

I appreciate that there's a lot of moving pieces and timing is still to come. Could you talk about some of the other TV titles besides, you know, Rookies and the spinoff and, you know, the studio? What are some others that you're excited about? And then finally, could you provide a perspective on what the impact might be from the Paramount Skydance and Warner Brothers Discovery combination on your library business?

Kevin, why don't you start?

Sure. Kevin Begg speaking. In addition to The Rookie going into season nine, which is really quite an accomplishment, and as John alluded to in his remarks, getting younger every year in demographics, which is just simply unheard of in broadcast television, The Rookie North spinoff is a great complement and expansion of that franchise. The studio, obviously, we're in season two. Hunting Wives has been a breakout success for us on Netflix. We just shooting season two. We're in the middle of shooting The Rainmaker season two for USA Network, a huge international driver for our business, about to start shooting Robin Hood season two. And we continue to be deeply immersed in the Powerverse, the power franchise that we share with stars. Sports wrapped up in early January, that particular show, season five of Canaan is coming in June, and we're in the first season of production on Origins, which is essentially a take on a young power, and hopefully more powder in that pipeline. Speaking about the Skydance, Paramount, Warner potential combination, we're really excited about what Skydance and Paramount have done before that relative to opening up their platform to outside studio suppliers like ourselves, both in originals in my area and Jim Packer's distribution side. I think our thesis is that, you know, a strong unified streaming player, whether they differentiate that to two brands or just one, is better than maybe two weaker ones in terms of firepower and ability to buy from the outside market. And, you know, we know we need to compete with the best creative product that we can and come up with better financial models but knowing there's a receptive buyer of course makes that virtuous circle really work for us but but Jim may want to talk about

distribution yeah I David I would say to be strong and compete internationally HBO has just opened up a couple of new territories in the last 24 months the one thing I've seen when all these types of mergers or consolidations go on is nobody stops competing they just compete and we have the kind of content that really fits competition well i'm going back i know kevin if you just look at our library i'll give you one quick stat that gives you a sense of the strength of our tv library um in um fiscal 22 we only had four series that were sold to the big six stream 26 we had 17 series but the most important part to that 10 of those 17 ranked in the top 10 of those various top six streaming platforms things like nurse jackie high town madman as you saw went to number one or two on hbo and spartacus so the library itself from a tv perspective continues to perform in a way that i think many many clients

are going to want all right appreciate the color all thank you the next question is from omar

Magias with Wells Fargo. Please go ahead. Hey, guys. Thanks for the question. Jimmy,

can you remind us what's the path to the leveraging here? Is 3R still a part of that leveraging story, or are you now focused on organic leveraging? And then my second question, Adam, following the stale performance of Michael, could you give us an update on Michael, too, and if you believe part two carries a similar strong commercial appeal as part one given the

arc of the story thank you guys over to jimmy uh he's continued to go exceptional michael jackson still pond in the first film happened even in the time frame of the original movie that weren't touched upon to a global audience and omar the we're just naturally delivering i mean with the

visibility that we have in the context of EBITDA growth, significant growth into 27, likewise strong positive free cash flow momentum just coming through our operations. So three hours really isn't either here or there with regards to the de-levering. I'm looking at four, four and a half times leverage off of 6.1 this period, which was, as you saw it down, you know just a little over a full turn from the prior quarter okay all of that is is natural when we get into the fourth quarter of our fiscal 27 as you know there's a three arts put there we could easily absorb that that would be about a half a turn otherwise if it's the right thing to do for three arts and you know we'll do whatever we need to do it's great for shareholder value in the business but as far as deleveraging we're deleveraging naturally yeah just it's

Brian Weinstein just jumping in. Look, we're the team's broad space for us. To diversify has proven to be the right one. Just to give you some specifics on the production side, we've got renewal, Will Trent, and Nobody Wants This, and Hunting Wives, and the falling term deals at SAG and the WGA. We've signed clients into a major motion picture. It's just a sign of the sort of things to come as we move forward.

So we're excited to be leveraging.

This is super helpful. Thank you, guys. Appreciate it.

The next question is from Brent Penter with Raymond James. Please go ahead.

Hi. Good afternoon, everyone. Thank you for taking the question. First one from me on Michael. Is there any color you all can give in terms of EBITDA contribution from that movie? Or at least as we try and do our own math, how to think about the puts and takes versus another movie of a similar scale in terms of maybe a very strong international presale? but also factoring in the estate's portion.

Well, yeah, we know I'm going to break out the absolute contribution on that, but obviously it's strong. Keep in mind we have Universal as a partner on the international side. And then, of course, we handle the pre-sales in Japan, which, as John noted, is yet to open. But great demand and great things happening there, we think. And so we're just excited about this, and that's part of the momentum. Again, you know, coming into the year extremely strong gives us enhanced visibility, we were always looking and striving for significant growth into fiscal 27, and I think this lays it out, and I think, you know, we're in a good position to not only drive 27, but also great carryover into 28.

Okay, great. And then just in broad terms, without getting into numbers, how should we think about the sequel and inputs and takes in terms of economics there? I think maybe there was some footage from the first one that's already been shot that you might be able to use. So how might that benefit you for the sequel?

Yeah, as we've said previously, looking at the story for the second movie is unfolding, we think we've got 25% to 30% of a second movie already shot. From the previously that will have our global audience once again, so I wouldn't want to quantify exactly what that will be material.

Okay, okay, great. And then final question for me, the poison pill expired on May 7th. Can you all talk at all about what that enables for you or what conversations that has enabled now that the poison pill is no longer in place?

The shareholders are going to re-up a poison pill, but we're going to leave it in their hands. As you mentioned, it will be expiring.

All right. Thanks, everyone.

The next question is from Sean Diffley with Morgan Stanley. Please go ahead.

Thanks very much, team. Two, if I may. The first is curious how you see AI changing studio margins over time and different things that it could unlock for your business. And then the second follow-up to the poison pill question, just as you think about the strategic landscape and obviously the value of IP, which has been underscored by Warner Brothers and other instances, how do you think about the standalone opportunity versus the potential benefits of being part of a bigger strategic organization? Thank you.

Well, the landscape continues to be moving towards more scale. It's creating significant opportunities for a pure play studio like ours. We love the core assets that we've put together over the last 25 years, both built and acquired, and we're laser-focused on maximizing the shareholder value. We separated the business to create a standalone studio and collapsed into a single share class, which has given us a great deal of maximum optionality, but also certainly increased our liquidity dramatically. And we feel like we have a world where scale and have never been more relevant.

Does perspective feel good about that? I mean, obviously we had really strong margins in the fourth quarter, so you can't always look to something like the housemaids, for example, which was very modestly priced and even less expensive when you look at it relative to our New Jersey tax credits that were something special here. And, you know, I did $400 million of global box office. So, you know, you can't look at that margin. But generally speaking, good margins going into next year, if you look at our fiscal 26 margins in total, growing those in motion pictures, we go into 27. TV right around the same level, I would think. You know, you've got a lot of renewals, but there are some sophomore series that are building in terms of profitability and margin. I mean, certainly profitable, but margins building. So I think I feel really strong about 27 margins continuing to increase or hold certain levels in TV.

It has expired.

Thanks very much.

The next question is from Matthew Harrigan with Benchmark. Please go ahead.

Thank you, and congratulations. Firstly, I guess it came out a few hours ago that you're actually going to separate the resurrection, Ascension Day 26 and 27, versus having them so tightly clustered, which I always thought was kind of maybe not economically optimal. You'd get more cannibalization. You'd get more anticipation for the second film. Is there anything to comment on there other than the economics probably look better? with better separation, just out of curiosity.

Hey, Matthew. Thanks for the question.

And, Matthew, with regards to just the economics on fiscal 27, right, as you move that out of the back end of 27, you know, that's a slight improvement. But realize we're also dropping day drinker in on that day, and you're going to have P&A there. So it's actually relatively neutral, probably slightly down a bit, just those changes on their own relative to fiscal 27 and then secondly I know

this is really conjectural but you had the C dance 2-0 sell off among the studio stocks in February and then we had you know some talk today on hell grind that that shown it can which is supposedly produced for $500,000 which certainly doesn't look like a you know top studio film it looks a lot better than you'd expect for, you know, $500,000 from what I've seen. How do you feel about just on the – obviously you've got benefits on the timeline for getting movies out faster and costs, but how do you feel about emergent, you know, competition from maybe people outside even the traditional studio rather than particular on the streaming side?

Through the history of our business, all the technological advances have unlocked value for media companies. This is going to be people who engage with content. We're launching, I'm very excited, but we're launching a new fan and creator. We're engaging with the fans wherever they are, and these are digital toolkits that we're going to give them that will build new versions. BTC Enterprise, Snowflake, across the board for productivity, for advanced analytics. And so across the board, whether it's just the operations of our business in terms of sales or whether it's enhanced and post-production, AI, we want to engage with our fans. We want to give them digital toolkits to create different versions, obviously, in a protected environment, obviously.

Great. Thanks, John. Thanks, Adam.

The next question is a follow-up from Vikram Kassava-Botla with Baird. Please go ahead.

Yeah, hey, thanks for letting me ask a couple more questions here. I just wanted to follow up on Michael, given that it was such a standout result for you. Now that you've had time to reflect on the feedback and the reactions, why do you think that this film performed as well as it did? And it seems like you took some unique approaches to marketing around that film that may have benefited the performance as well. I'd be curious if you could elaborate on some of the strategies that you used there that helped drive the success.

Sure. I'm happy to try to offer some thoughts. Look, I think we said on multiple earnings calls prior to the release of the film that the fact that Michael did an extraordinary job, it wasn't just that. And, you know, you're seeing the ancillary benefits because his music is at the top of the charts now as well. In terms of marketing, he was running marketing 20 years ago. How you reach people has significantly changed. And I give an immense amount of credit to both our marketing and our distribution. were not only exciting to the people who were seeing them in the moment, but became viral and passed along on every platform and social media. And you just can't buy your way into awareness and enthusiasm anymore. You have to create the tools for fans to share with one another. And I think the teams here and around the world did that.

Okay, that's helpful. And just last one for me, you know, curious if you could talk about or refresh us on your philosophy around balancing the mix of tentpole films versus mid-budget films over the next few years, and particularly given the success you've had recently with The Housemaid and Michael, if any of that has affected your perspective on how you plan to manage the portfolio going forward? Yeah, no,

it has not changed it. It's reinforced what I've been talking about, what John has been talking about, and the conversations that we've been having. I mean, it's nice that when you mention a movie like The Housemaid and a movie like Michael, you are talking about two very different movies. One, lower end of this and what actors and actresses are coming on board, what producers. We've definitely been working hard to make sure that our existing IP, when we see an audience demanding more, that we're giving them an exciting version of what they're demanding. But when John mentioned in his opening remarks, things like Blair Witch or another Hunger Games movie, those are very modestly priced films. When we're talking to Michael, those are larger films. And I think we'll have two to four tentpoles. Yeah, I think I'd just add that, you know, that word tentpole

implies just a huge, you know, you could interchange tentpole and franchise and then just branded properties. And as I said in my remarks, we're going to be posting, I'm going to keep doing that in the future, we're going to be posting at least one slide that just shows what our pipeline looks like going forward in terms of television, film, and live entertainment. I think everyone's going to be really surprised to see how many branded properties we have. I think, you know, you'll be able to look at that, and you will see that we have as many well-known branded properties as any filling the pipeline with those properties in the future. And obviously, whether it's a housemaid that was made for about a fifth, a tenfold, you can call it a franchise. But I think the key thing is take a look at that slide. I think you'll be excited to know how much.

Okay. Thanks, everyone. I appreciate the color.

This concludes our question and answer session. I would like to turn the conference back over to and Nileh Shah for any closing remarks.

Hi, everyone. Please refer to the Press Releases and Events tab under the Investor Relations section of our website for discussion of certain non-GAAP measures discussed on this call.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.