Lionsgate Studios Corp. (LION) Stock Analysis and Metrics

Lionsgate Studios

NYSE: LION

$13.34 ▼ -0.06 (-0.45%)

At close: Jul 24, 2026 · 3:59 PM UTC

Financial Ratios

Market Cap3.83 Bn

P/E-231.95

P/S1.45

Div. Yield0.00

ROIC (Qtr)0.00

Total Debt (Qtr)2.10 Bn

Revenue Growth (1y) (Qtr)4.73

Add ratio to table…

About

Lionsgate Studios Corp. is a standalone pure play content company that focuses on motion picture and television production and distribution. The firm owns and manages a library of more than 20,000 film and television titles. It creates acquires and distributes content through its Motion Picture and Television Production segments. Lionsgate Studios Corp. operates worldwide and leverages its entrepreneurial culture to drive value from its brands franchises and talent management capabilities.

Lionsgate Studios Corp. generates revenue primarily by licensing its motion picture and television content to theatrical exhibitors home entertainment retailers digital platforms television networks and international distributors. The company also earns income from home entertainment sales of packaged media and digital downloads from its extensive library. Additionally it receives fees from television licensing deals music publishing and ancillary uses such as in flight entertainment hotels hospitals and correctional facilities. Through its interest in 3 Arts Entertainment the firm also collects talent management commissions and executive producer fees.

The company operates through the following segments: Motion Picture and Television Production.

• Motion Picture: This segment includes revenues from theatrical releases home entertainment television licensing international distribution and other ancillary markets such as games music and location based entertainment.

• Television Production: This segment earns revenue from licensing scripted and unscripted series to domestic and international television markets home entertainment sales and other ancillary activities including music sales and talent management related fees.

Lionsgate Studios Corp. is recognized as one of the world's leading standalone pure play content companies. It competes with major studios such as Warner Bros Discovery Disney Universal Paramount and Sony as well as independent producers and streaming platforms like Netflix Amazon Prime Video and Disney+. Competitive advantages include its deep content library of over 20,000 titles valuable franchises such as John Wick The Hunger Games Twilight and Saw strong talent management ties through 3 Arts Entertainment and a global distribution network that reaches theatrical digital and television audiences worldwide.

The company serves theatrical exhibitors including major chains such as AMC Regal and Cinemark home entertainment retailers like Walmart Target and Best Buy digital platforms including Amazon Prime Video Apple TV Netflix Hulu Max Peacock Paramount+ Pluto Roku Channel Samsung Tubi TV and YouTube television networks such as CBS ABC Showtime Starz HBO and international distributors in Europe Latin America and Asia Pacific as well as ancillary clients like hotels hospitals airlines and correctional facilities.

Investment Thesis

▲ Bull case

Lionsgate Studios (LION) possesses a substantial backlog of $1.5 billion, representing off-balance sheet contractual commitments that are not yet reflected on the balance sheet, with 80% of this amount expected to convert to revenue or cash flow within the next 15 months, providing a highly visible and de-risked revenue stream that is underappreciated by the market given current leverage concerns; this backlog, up 26% year-over-year, signals robust future demand for Lionsgate's content across multiple platforms and directly supports management's guidance for meaningful leverage reduction by mid-fiscal 2027, as the natural inflow from this contracted work will drive adjusted OIBDA growth and free cash flow generation without requiring new sales efforts, effectively derisking the path to deleveraging and validating the company's trajectory toward a 3.0x to 3.5x leverage range in fiscal 2028.
The company's library revenue reached a record $1.05 billion on a trailing-12-month basis, growing 10% year-over-year for the fifth consecutive quarter, with television series now contributing 33% of this total—more than double the proportion from a decade ago—highlighting a successful strategic shift toward monetizing its deep and young library (85% of 20,000-plus titles produced since 2000) across diversified platforms including FAST, AVOD, EST, and VOD, while the underpromoted growth in FAST and AVOD revenue, currently at 6% of library revenue but targeted to reach 10-15% of trailing-12-month revenue within the next year, represents a scalable, high-margin advertising-driven stream that benefits from Lionsgate's flexibility as a non-owner of a proprietary streaming platform, allowing it to license content globally to multiple pay-one window partners and ad-supported services without conflict, thereby creating a structural advantage in an increasingly fragmented streaming landscape.
Lionsgate's active franchise portfolio exceeds 40 properties spanning film, television, video games, and live experiences, with recent successes like The Housemaid and Now You See Me: Now You Don't driving exceptional international box office performance in self-distributed markets (U.K. and Latin America), and the upcoming fiscal '27 slate—anchored by Michael, Hunger Games: Sunrise on the Reaping, and Resurrection of the Christ—supported by a deep pipeline of sequels and new installments (John Rambo, Dirty Dancing, Caine, John Wick sequel, Naruto, American Psycho, Saw, Blair Witch) ensures sustained content output that leverages existing IP to reduce creative risk and marketing costs, while early-stage live experiences such as Hunger Games Live in London and Now You See Live in Australia demonstrate strong engagement and are expected to become material revenue contributors over the next two years, adding a new, high-growth dimension to IP monetization beyond traditional windows.
The appointment of a Chief AI Officer, Kathleen Grace, and the ongoing partnership with Runway signal a deliberate and underdiscussed integration of artificial intelligence into creative and technical operations, including previsualization, script revisions, visual effects, and FAST channel scheduling, which management indicated is being used effectively on shows like Spartacus: House of Ashur and planned for broader application; this initiative is not merely experimental but is being embedded into core workflows to enhance efficiency, reduce production timelines, and lower costs—particularly valuable in mid-budget filmmaking where Lionsgate has demonstrated strength—and positions the company to benefit from AI-driven scalability in content creation without significant capital expenditure, a factor that could meaningfully improve margins and output volume as the technology matures.
Management's decision to dissolve the shareholder rights plan and unify share classes, coupled with the addition of Steven Mnuchin to the Board, reflects a proactive alignment with shareholder interests and a readiness for potential M&A activity, not as a sign of weakness but as a strategic positioning to capitalize on industry consolidation trends where Lionsgate's valuable, non-streamer-tethered IP portfolio makes it an attractive partner or target; the company's emphasis on not owning a proprietary streaming platform is a deliberate advantage that increases flexibility in licensing and avoids the financial burden of streaming losses, allowing it to remain agile in a market where scaled streamers are seeking third-party content to bolster their libraries, a dynamic that could unlock premium valuation multiples in any future transaction.

Lionsgate Studios (LION) possesses a substantial backlog of $1.5 billion, representing off-balance sheet contractual commitments that are not yet reflected on the balance sheet, with 80% of this amount expected to convert to revenue or cash flow within the next 15 months, providing a highly visible and de-risked revenue stream that is underappreciated by the market given current leverage concerns; this backlog, up 26% year-over-year, signals robust future demand for Lionsgate's content across multiple platforms and directly supports management's guidance for meaningful leverage reduction by mid-fiscal 2027, as the natural inflow from this contracted work will drive adjusted OIBDA growth and free cash flow generation without requiring new sales efforts, effectively derisking the path to deleveraging and validating the company's trajectory toward a 3.0x to 3.5x leverage range in fiscal 2028.
The company's library revenue reached a record $1.05 billion on a trailing-12-month basis, growing 10% year-over-year for the fifth consecutive quarter, with television series now contributing 33% of this total—more than double the proportion from a decade ago—highlighting a successful strategic shift toward monetizing its deep and young library (85% of 20,000-plus titles produced since 2000) across diversified platforms including FAST, AVOD, EST, and VOD, while the underpromoted growth in FAST and AVOD revenue, currently at 6% of library revenue but targeted to reach 10-15% of trailing-12-month revenue within the next year, represents a scalable, high-margin advertising-driven stream that benefits from Lionsgate's flexibility as a non-owner of a proprietary streaming platform, allowing it to license content globally to multiple pay-one window partners and ad-supported services without conflict, thereby creating a structural advantage in an increasingly fragmented streaming landscape.
Lionsgate's active franchise portfolio exceeds 40 properties spanning film, television, video games, and live experiences, with recent successes like The Housemaid and Now You See Me: Now You Don't driving exceptional international box office performance in self-distributed markets (U.K. and Latin America), and the upcoming fiscal '27 slate—anchored by Michael, Hunger Games: Sunrise on the Reaping, and Resurrection of the Christ—supported by a deep pipeline of sequels and new installments (John Rambo, Dirty Dancing, Caine, John Wick sequel, Naruto, American Psycho, Saw, Blair Witch) ensures sustained content output that leverages existing IP to reduce creative risk and marketing costs, while early-stage live experiences such as Hunger Games Live in London and Now You See Live in Australia demonstrate strong engagement and are expected to become material revenue contributors over the next two years, adding a new, high-growth dimension to IP monetization beyond traditional windows.
The appointment of a Chief AI Officer, Kathleen Grace, and the ongoing partnership with Runway signal a deliberate and underdiscussed integration of artificial intelligence into creative and technical operations, including previsualization, script revisions, visual effects, and FAST channel scheduling, which management indicated is being used effectively on shows like Spartacus: House of Ashur and planned for broader application; this initiative is not merely experimental but is being embedded into core workflows to enhance efficiency, reduce production timelines, and lower costs—particularly valuable in mid-budget filmmaking where Lionsgate has demonstrated strength—and positions the company to benefit from AI-driven scalability in content creation without significant capital expenditure, a factor that could meaningfully improve margins and output volume as the technology matures.
Management's decision to dissolve the shareholder rights plan and unify share classes, coupled with the addition of Steven Mnuchin to the Board, reflects a proactive alignment with shareholder interests and a readiness for potential M&A activity, not as a sign of weakness but as a strategic positioning to capitalize on industry consolidation trends where Lionsgate's valuable, non-streamer-tethered IP portfolio makes it an attractive partner or target; the company's emphasis on not owning a proprietary streaming platform is a deliberate advantage that increases flexibility in licensing and avoids the financial burden of streaming losses, allowing it to remain agile in a market where scaled streamers are seeking third-party content to bolster their libraries, a dynamic that could unlock premium valuation multiples in any future transaction.

▼ Bear case

Lionsgate Studios (LION) faces significant financial headwinds due to a leverage ratio of 7.4x at quarter-end, driven by lower trailing-12-month adjusted EBITDA, which management acknowledged is a direct result of depressed earnings rather than strategic investments, and while the company anticipates natural deleveraging through backlog conversion, this assumes consistent execution and market demand without accounting for potential delays in content delivery, episodic slippage, or underperformance of key fiscal '27 tentpoles like Michael or Hunger Games: Sunrise on the Reaping, which could prolong high leverage and constrain financial flexibility, especially given the $109 million net cash flow used in operating activities and $58 million adjusted free cash flow use during the quarter, indicating ongoing cash consumption rather than generation despite the strong library revenue figure.
The Motion Picture segment profit declined year-over-year to $59 million, primarily due to approximately $100 million of P&A spend tied to three wide theatrical titles, including The Housemaid, and while management framed this as timing-related and beneficial for future library replenishment, the upfront marketing burden remains a structural drag on profitability that is not fully offset by carryover benefits, particularly if the pay-one window monetization—though expected to be strong with Starz and HBO for Housemaid—does not materialize as anticipated or faces compression from intensifying competition for streaming rights, which could reduce the long-term value extraction from theatrical successes and pressure the segment's ability to convert box office into sustained profit.
Television segment profit was $56 million, down year-over-year due to episodic delivery timing, and although 12 of 13 scripted series were renewed across 12 different buyers, this achievement masks underlying volatility in the television business, where reliance on deficit financing and cost-plus models creates revenue recognition lumpiness and dependency on buyer willingness to commission new seasons, a risk amplified by the fact that even with strong renewals, the group must double episodic deliveries in fiscal '27 to meet guidance, a scaling challenge that may prove difficult if buyer budgets tighten post-strike or if international distribution deals fail to materialize at scale, potentially leaving the company exposed to uneven cash flow and unmet growth targets despite the optimistic renewal narrative.
Although Lionsgate highlighted AI initiatives and the appointment of a Chief AI Officer, the discussion remained vague on specific, measurable outcomes, with no clear timeline for when AI integration will meaningfully reduce production costs or increase output volume, and the partnership with Runway, while described as strong, lacks disclosed financial terms or pilot results that would validate efficiency gains, leaving the initiative susceptible to being perceived as a strategic gesture rather than a near-term operational lever, especially given that AI-driven cost savings in mid-budget filmmaking—where Lionsgate seeks to compete—require significant workflow changes and talent adaptation that may not yield benefits within the current fiscal year outlook.
The company's net debt of $1.75 billion and reliance on backlog conversion for deleveraging expose it to refinancing risk if market conditions deteriorate or if adjusted OIBDA fails to grow as projected, particularly since the revolver has $770 million of undrawn capacity but the cash balance is only $213 million, leaving limited liquidity buffer against unexpected downturns, and while management targets leverage in the 3.0x to 3.5x range by fiscal 2028, this assumes sustained free cash flow improvement and OIBDA growth that is not yet evident in the current quarterly results, where adjusted earnings were just $0.01 per share, raising doubts about the speed and certainty of the deleveraging path amid an industry environment marked by intense competition for content and pricing pressure across distribution windows.

Lionsgate Studios (LION) faces significant financial headwinds due to a leverage ratio of 7.4x at quarter-end, driven by lower trailing-12-month adjusted EBITDA, which management acknowledged is a direct result of depressed earnings rather than strategic investments, and while the company anticipates natural deleveraging through backlog conversion, this assumes consistent execution and market demand without accounting for potential delays in content delivery, episodic slippage, or underperformance of key fiscal '27 tentpoles like Michael or Hunger Games: Sunrise on the Reaping, which could prolong high leverage and constrain financial flexibility, especially given the $109 million net cash flow used in operating activities and $58 million adjusted free cash flow use during the quarter, indicating ongoing cash consumption rather than generation despite the strong library revenue figure.
The Motion Picture segment profit declined year-over-year to $59 million, primarily due to approximately $100 million of P&A spend tied to three wide theatrical titles, including The Housemaid, and while management framed this as timing-related and beneficial for future library replenishment, the upfront marketing burden remains a structural drag on profitability that is not fully offset by carryover benefits, particularly if the pay-one window monetization—though expected to be strong with Starz and HBO for Housemaid—does not materialize as anticipated or faces compression from intensifying competition for streaming rights, which could reduce the long-term value extraction from theatrical successes and pressure the segment's ability to convert box office into sustained profit.
Television segment profit was $56 million, down year-over-year due to episodic delivery timing, and although 12 of 13 scripted series were renewed across 12 different buyers, this achievement masks underlying volatility in the television business, where reliance on deficit financing and cost-plus models creates revenue recognition lumpiness and dependency on buyer willingness to commission new seasons, a risk amplified by the fact that even with strong renewals, the group must double episodic deliveries in fiscal '27 to meet guidance, a scaling challenge that may prove difficult if buyer budgets tighten post-strike or if international distribution deals fail to materialize at scale, potentially leaving the company exposed to uneven cash flow and unmet growth targets despite the optimistic renewal narrative.
Although Lionsgate highlighted AI initiatives and the appointment of a Chief AI Officer, the discussion remained vague on specific, measurable outcomes, with no clear timeline for when AI integration will meaningfully reduce production costs or increase output volume, and the partnership with Runway, while described as strong, lacks disclosed financial terms or pilot results that would validate efficiency gains, leaving the initiative susceptible to being perceived as a strategic gesture rather than a near-term operational lever, especially given that AI-driven cost savings in mid-budget filmmaking—where Lionsgate seeks to compete—require significant workflow changes and talent adaptation that may not yield benefits within the current fiscal year outlook.
The company's net debt of $1.75 billion and reliance on backlog conversion for deleveraging expose it to refinancing risk if market conditions deteriorate or if adjusted OIBDA fails to grow as projected, particularly since the revolver has $770 million of undrawn capacity but the cash balance is only $213 million, leaving limited liquidity buffer against unexpected downturns, and while management targets leverage in the 3.0x to 3.5x range by fiscal 2028, this assumes sustained free cash flow improvement and OIBDA growth that is not yet evident in the current quarterly results, where adjusted earnings were just $0.01 per share, raising doubts about the speed and certainty of the deleveraging path amid an industry environment marked by intense competition for content and pricing pressure across distribution windows.

Geographical Breakdown of Revenue (2026)

Peer Comparison

Companies in the

S.No.	Ticker	Company	Market Cap	P/E	P/S	Total Debt (Qtr)
1	ATMP	Barclays Bank Plc	38,347,746.23 Bn	7.51 Mn	-	-
2	CMCSA	Comcast Corp	78.85 Bn	0.00 Mn	0.63	90.38 Bn
3	AMUB	Ubs Ag	70.83 Bn	0.00 Mn	1.49	-
4	FISV	Fiserv Inc	26.70 Bn	0.00 Mn	1.27	29.18 Bn
5	RLNDF	RoyaLand Co Ltd.	23.50 Bn	-7.89 Mn	-	0.00 Bn
6	PHYS	Sprott Physical Gold Trust	14.74 Bn	-	5,797.10	-
7	CRBD	Corebridge Financial, Inc.	12.00 Bn	0.00 Mn	0.89	1.37 Bn
8	PSLV	Sprott Physical Silver Trust	11.74 Bn	-	4,190.34	-

Research Tools

Developers

About

Investment Thesis

Segments Breakdown of Revenue (2026)

Geographical Breakdown of Revenue (2026)

Peer Comparison

Research Tools

Developers

About

Investment Thesis

Segments Breakdown of Revenue (2026)

Geographical Breakdown of Revenue (2026)

Peer Comparison

Create an account

Sign In

Reset Password