LIONS GATE ENTERTAINMENT CORP CN

Previous wording

In October 2024, we filed a joint proxy statement/prospectus on Form S-4 with the SEC relating to the implementation of a plan of arrangement that will result in the separation of the businesses of Lionsgate Studios Corp., of which we own approximately 87.8% and which encompasses our motion picture and television studio operations, from our other businesses, including the STARZ-branded premium subscription platform (the “Proposed Separation”). The Proposed Separation will be subject to the satisfaction of a number of conditions and our Board of Directors, together with the Board of Directors of Lionsgate Studios Corp., may decide not to proceed with the Proposed Separation. Additionally, the Proposed Separation is complex in nature, and unanticipated developments or changes, including disruptions in general market conditions, changes in law or execution challenges may affect our ability to complete the Proposed Separation on the terms and on the timeline we announced, or at all. These or other developments could cause us not to realize some or all of the expected benefits of the Proposed Separation, or to realize them on a different timeline than expected.

Current wording

In October 2024, as amended in January 2025, we filed a joint proxy statement/prospectus on Form S-4 with the SEC relating to the implementation of a plan of arrangement that will result in the separation of the businesses of Lionsgate Studios Corp., of which we own approximately 87.8% and which encompasses our motion picture and television studio operations, from our other businesses, including the STARZ-branded premium subscription platform (the “Proposed Separation”). The Proposed Separation will be subject to the satisfaction of a number of conditions and our Board of Directors, together with the Board of Directors of Lionsgate Studios Corp., may decide not to proceed with the Proposed Separation. Additionally, the Proposed Separation is complex in nature, and unanticipated developments or changes, including disruptions in general market conditions, changes in law or execution challenges may affect our ability to complete the Proposed Separation on the terms and on the timeline we announced, or at all. These or other developments could cause us not to realize some or all of the expected benefits of the Proposed Separation, or to realize them on a different timeline than expected.

Previous wording

During fiscal 2024, the Company continued executing its Media Networks restructuring plan, which included exiting all international territories except for Canada and India, and included an evaluation of the programming on Starz's domestic and international platforms. The Company has incurred impairment charges from the inception of the plan through September 30, 2024 amounting to $741.4 million.

Current wording

During fiscal 2024, the Company continued executing its Media Networks restructuring plan, which included exiting all international territories except for Canada and India, and included an evaluation of the programming on Starz's domestic and international platforms. The Company has incurred impairment charges from the inception of the plan through December 31, 2024 amounting to $735.1 million.

Previous wording

During the three and six months ended September 30, 2024, the Company recorded net recoveries of content impairment charges related to the Media Networks segment of $4.3 million and $2.4 million, respectively (three and six months ended September 30, 2023 - content impairment charges of $211.6 million and $239.5 million, respectively).

Current wording

During the three and nine months ended December 31, 2024, the Company recorded net recoveries of content impairment charges related to the Media Networks segment of $6.4 million and $8.8 million, respectively (three and nine months ended December 31, 2023 - content impairment charges of $77.8 million and $317.4 million, respectively).

Previous wording

As the Company continues to evaluate the Media Networks business and its current restructuring plan in relation to the current micro and macroeconomic environment and the announced plan to separate the Company's Starz business (i.e., Media Networks segment) and Studio Business (i.e., Motion Picture and Television Production segments), including further strategic review of content performance and its strategy on a territory-by-territory basis, the Company may decide to expand its restructuring plan and exit additional territories or remove certain content off its platform in the future. Accordingly, the Company may incur additional content impairment and other restructuring charges.

Current wording

As the Company continues to evaluate the Media Networks business and its current restructuring plan in relation to the current micro and macroeconomic environment and the Proposed Separation to separate the Company's Starz business (i.e., Media Networks segment) and Studio Business (i.e., Motion Picture and Television Production segments), including further strategic review of content performance and its strategy on a territory-by-territory basis, the Company may decide to expand its restructuring plan and exit additional territories or remove certain content off its platform in the future. Subsequent to December 31, 2024, the Company removed programming on Starz's domestic platform which had a carrying value of approximately $77.4 million, which charge, measured as the excess of the carrying value over the fair value of the titles removed, will be recorded during the fourth quarter ending March 31, 2025. Accordingly, the Company may incur additional content impairment and other restructuring charges.

Previous wording

Our revenues are derived from the Motion Picture, Television Production and Media Networks segments, as described below. We refer to our Motion Picture and Television Production segments collectively as our Studio Business. Our revenues are derived from the U.S., Canada, the United Kingdom and other foreign countries. None of the non-U.S. countries individually comprised greater than 10% of total revenues for the three and six months ended September 30, 2024 and 2023.

Current wording

Our revenues are derived from the Motion Picture, Television Production and Media Networks segments, as described below. We refer to our Motion Picture and Television Production segments collectively as our Studio Business. Our revenues are derived from the U.S., Canada, the United Kingdom and other foreign countries. None of the non-U.S. countries individually comprised greater than 10% of total revenues for the three and nine months ended December 31, 2024 and 2023.

Previous wording

As a result of the Media Networks restructuring initiatives discussed in "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations - Overview", we have incurred impairment charges from the inception of the plan through September 30, 2024 amounting to $741.4 million. During the three and six months ended September 30, 2024, we recorded net recoveries of content impairment charges related to the Media Networks segment of $4.3 million and $2.4 million, respectively, which are included in restructuring and other in the unaudited condensed consolidated statement of operations (three and six months ended September 30, 2023 - content impairment charges of $211.6 million and $239.5 million, respectively) (see Note 3 and Note 14 to our unaudited condensed consolidated financial statements).

Current wording

31, 2024, we recorded net recoveries of content impairment charges related to the Media Networks segment of $6.4 million and $8.8 million, respectively, which are included in restructuring and other in the unaudited condensed consolidated statement of operations (three and nine months ended December 31, 2023 - content impairment charges of $77.8 million and $317.4 million, respectively). Subsequent to December 31, 2024, the Company removed programming on Starz's domestic platform which had a carrying value of approximately $77.4 million, which charge, measured as the excess of the carrying value over the fair value of the titles removed, will be recorded during the fourth quarter ending March 31, 2025. See Note 3 and Note 14 to our unaudited condensed consolidated financial statements.

Previous wording

Goodwill. At September 30, 2024, the carrying value of goodwill was $806.5 million. Goodwill is allocated to our reporting units, which are our operating segments or one level below our operating segments (component level). Reporting units are determined by the discrete financial information available for the component and whether that information is regularly reviewed by segment management. Components are aggregated into a single reporting unit if they share similar economic characteristics. Our reporting units for purposes of goodwill impairment testing, along with their respective goodwill balances at September 30, 2024, were Motion Picture (goodwill of $396 million), Media Networks (no remaining goodwill balance), and our Television (goodwill of $317 million) and Talent Management (goodwill of $93 million) businesses, both of which are part of our Television Production segment.

Current wording

Goodwill. At December 31, 2024, the carrying value of goodwill was $808.5 million. Goodwill is allocated to our reporting units, which are our operating segments or one level below our operating segments (component level). Reporting units are determined by the discrete financial information available for the component and whether that information is regularly reviewed by segment management. Components are aggregated into a single reporting unit if they share similar economic characteristics. Our reporting units for purposes of goodwill impairment testing, along with their respective goodwill balances at December 31, 2024, were Motion Picture (goodwill of $397 million), Media Networks (no remaining goodwill balance), and our Television (goodwill of $319 million) and Talent Management (goodwill of $93 million) businesses, both of which are part of our Television Production segment.

Previous wording

Our qualitative assessments considered the market price of the Company’s common shares, the recent performance of these reporting units, and updated forecasts of performance and cash flows, as well as the current micro and macroeconomic environments in relation to the current and expected performance of these reporting units, and industry considerations, and determined that since the date of the most recent quantitative assessment performed over these reporting units, there were no events or circumstances that rise to a level that would more-likely-than-not reduce the fair value of those reporting units below their carrying values; therefore, a quantitative goodwill impairment analysis was not required for these reporting units.

Current wording

Our qualitative assessments considered the market price of the Company’s common shares, the recent performance of these reporting units, and updated forecasts of performance and cash flows, as well as the current micro and macroeconomic environments in relation to the current and expected performance of these reporting units, and industry considerations, and determined that since the date of the most recent quantitative assessment performed over these reporting units (and for the December 31, 2024 assessment, since our qualitative assessment performed for fiscal 2024), there were no events or circumstances that rise to a level that would more-likely-than-not reduce the fair value of those reporting units below their carrying values; therefore, a quantitative goodwill impairment analysis was not required for these reporting units.

Previous wording

Finite-Lived Intangible Assets. At September 30, 2024, the carrying value of our finite-lived intangible assets was $916.5 million. Our finite-lived intangible assets primarily relate to customer relationships associated with U.S. MVPDs, including cable operators, satellite television providers and telecommunications companies ("Traditional Affiliate"), which amounted to $839.2 million. The amount of our customer relationship asset related to these Traditional Affiliate relationships reflects the estimated fair value of these customer relationships determined in connection with the acquisition of Starz on December 8, 2016, net of amortization recorded since the date of the Starz acquisition. Beginning October 1, 2023, our finite-lived intangible assets also include the trade names previously accounted for as indefinite-lived intangible assets.

Current wording

Finite-Lived Intangible Assets. At December 31, 2024, the carrying value of our finite-lived intangible assets was $880.9 million. Our finite-lived intangible assets primarily relate to customer relationships associated with U.S. MVPDs, including cable operators, satellite television providers and telecommunications companies ("Traditional Affiliate"), which amounted to $806.3 million. The amount of our customer relationship asset related to these Traditional Affiliate relationships reflects the estimated fair value of these customer relationships determined in connection with the acquisition of Starz on December 8, 2016, net of amortization recorded since the date of the Starz acquisition. Beginning October 1, 2023, our finite-lived intangible assets also include the trade names previously accounted for as indefinite-lived intangible assets.

Previous wording

The Company monitors its finite-lived intangible assets and changes in the underlying circumstances each reporting period for indicators of possible impairments or a change in the useful life or method of amortization of our finite-lived intangible assets. For fiscal 2024, due to changes in the industry related to the migration from linear to OTT and direct-to-consumer consumption, and continuing difficult macro and microeconomic conditions, we performed an impairment analysis of our amortizable intangible assets. The impairment analysis requires a comparison of undiscounted future cash flows expected to be generated over the useful life of an asset to the carrying value of the asset. Based on our impairment analysis, the estimated undiscounted cash flows exceeded the carrying amount of the assets and therefore no impairment charge was required.

Current wording

The Company monitors its finite-lived intangible assets and changes in the underlying circumstances each reporting period for indicators of possible impairments or a change in the useful life or method of amortization of our finite-lived intangible assets. For fiscal 2024, due to changes in the industry related to the migration from linear to OTT and direct-to-consumer consumption, and continuing difficult macro and microeconomic conditions, we performed an impairment analysis of our amortizable intangible assets. The impairment analysis requires a comparison of undiscounted future cash flows expected to be generated over the useful life of an asset or asset group to the carrying value of the asset or asset group. Based on our impairment analysis, the estimated undiscounted cash flows exceeded the carrying amount of the asset group that includes the Starz customer relationship and tradename intangible assets by over 50% and therefore no impairment charge was required. The estimated undiscounted cash flow assumed a weighted average growth in revenue over the useful life of approximately 2.5%.

Previous wording

During the three and six months ended September 30, 2024, there were no events or circumstances that would indicate that the carrying amount of our finite-lived intangible assets may not be recoverable.

Current wording

During the three and nine months ended December 31, 2024, there were no events or circumstances that would indicate that the carrying amount of our finite-lived intangible assets may not be recoverable.

Previous wording

Determining whether an intangible asset is recoverable or impaired requires various estimates and assumptions, including whether events or circumstances indicate that the carrying amount of the asset may not be recoverable, determining estimates of future cash flows for the assets involved and, when applicable, the assumptions applied in determining fair value, including discount rates, growth rates, market risk premiums and other assumptions about the economic environment. Should the revenues from our Traditional Affiliate relationships decline more than the assumed attrition rates used in our current estimates, either as a result of decreases in subscriber rates or changes of the terms of our renewals of our Traditional Affiliate contracts, we may have indicators of impairment which could result in an impairment of our customer relationships intangible assets, or we may need to further shorten the useful life or adopt a more accelerated method of amortization, both of which would increase the amount of amortization expense we record.

Current wording

Determining whether an intangible asset is recoverable or impaired requires various estimates and assumptions, including whether events or circumstances indicate that the carrying amount of the asset or asset group may not be recoverable, determining estimates of future cash flows for the assets involved and, when applicable, the assumptions applied in determining fair value, including discount rates, growth rates, market risk premiums and other assumptions about the economic environment. If actual revenues significantly underperform as compared to the forecasted amounts and cost cannot be sufficiently reduced, the undiscounted cash flows may not exceed the carrying value of the asset group and an impairment charge could result for the difference between the fair value and the carrying value of the asset group.

Previous wording

Revenues. Consolidated revenues decreased $66.9 million in the three months ended September 30, 2024 reflecting a decrease of $69.6 million from our Media Networks business and increased intersegment eliminations of $31.2 million, partially offset by an increase of $33.9 million from our Studio Business. Studio Business revenues for the three months ended September 30, 2024 included approximately $126.7 million of revenues from eOne (acquired December 27, 2023, therefore the three months ended September 30, 2023 included no comparable revenues). Intersegment eliminations relate to the licensing of product from our Studio Business to the Media Networks segment.

Current wording

Revenues. Consolidated revenues decreased $4.6 million in the three months ended December 31, 2024 reflecting an increase of $22.2 million from our Studio Business and decreased intersegment eliminations of $45.9 million, partially offset by a decrease of $72.7 million from our Media Networks business. Studio Business revenues for the three months ended December 31, 2024 included approximately $126.9 million of revenues from eOne (acquired December 27, 2023, therefore the three months ended December 31, 2023 included no material comparable revenues). Intersegment eliminations relate to the licensing of product from our Studio Business to the Media Networks segment.

Previous wording

Motion Picture revenue increased $11.2 million due to increased international revenue driven by Borderlands and the multi-platform release, The Killer's Game, partially offset by lower theatrical, and home entertainment revenue. Motion Picture revenues for the three months ended September 30, 2024 included approximately $15.6 million of revenues from eOne. Motion Picture revenue included $72.1 million of revenue from licensing Motion Picture segment product to the Media Networks segment, representing an increase of $11.6 million from the three months ended September 30, 2023.

Current wording

Motion Picture revenue decreased $134.0 million due to lower theatrical and international revenue as compared to the prior year's quarter, which included the release of The Hunger Games: The Ballad of Songbirds & Snakes, and lower television, home entertainment revenue and other revenue. Motion Picture revenues for the three months ended December 31, 2024 included approximately $12.6 million of revenues from eOne. Motion Picture revenue included $9.9 million of revenue from licensing Motion Picture segment product to the Media Networks segment, representing a decrease of $26.7 million from the three months ended December 31, 2023.

Previous wording

Television Production revenue increased $45.6 million due to the inclusion of revenue from eOne of $187.9 million, offset by lower home entertainment digital and international revenue. Television Production revenue included $189.4 million of revenue from licensing Television Production segment product to our Media Networks segment, representing a decrease of $21.9 million from the six months ended September 30, 2023.

Current wording

Television Production revenue increased $156.2 million due to the inclusion of revenue from eOne of approximately $114.3 million, and increases in home entertainment, international and other revenue. Television Production revenue included $77.9 million of revenue from licensing Television Production segment product to our Media Networks segment, representing a decrease of $19.2 million from the three months ended December 31, 2023.

Previous wording

Media Networks revenue decreased $69.6 million and reflected decreases in international revenue of $68.6 million due to the exiting of the majority of international territories, and a decrease at Starz Networks of $1.0 million.

Current wording

Media Networks revenue decreased $72.7 million and reflected decreases in international revenue of $67.7 million due to the exiting of the majority of international territories, and a decrease at Starz Networks of $5.0 million.

Previous wording

Direct operating expenses increased in the three months ended September 30, 2024 due to higher direct operating expenses for our Studio Business, partially offset by lower direct operating expenses for the Media Networks segment, and higher intersegment eliminations. The increase at the Studio Business reflects higher direct operating expenses of the Television Production segment associated with higher Television Production revenues, and higher direct operating expenses as a percentage of revenue of the Motion Picture segment driven by the performance and costs of the titles released in the quarter, in particular, Borderlands, which resulted in higher direct operating cost in relation to revenue. The decrease in Media Networks direct operating expense was driven by decreases of $36.7 million due to the territories exited, partially offset by an increase at Starz Networks of $21.2 million due to higher programming cost amortization. The increase in intersegment eliminations is due to increased Television Production revenue from licenses of original series to the Starz Platforms, and increased Motion Picture revenue from licenses of recent theatrical releases to the Starz Platforms, as discussed above. See further discussion in the Segment Results of Operations section below.

Current wording

Direct operating expenses increased in the three months ended December 31, 2024 due to higher direct operating expenses for our Studio Business and Media Networks segment, and lower intersegment eliminations. The increase at the Studio Business reflects higher direct operating expenses of the Television Production segment associated with increased Television Production revenues, partially offset by lower direct operating expenses of the Motion Picture segment associated with decreased Motion Picture revenue. The increase in Media Networks direct operating expense was driven by an increase at Starz Networks of $42.8 million due to higher programming cost amortization, partially offset by a decrease of $36.6 million due to the territories exited. The decrease in intersegment eliminations is due to lower Motion Picture and Television Production revenue from licenses of motion pictures and original series to the Media Networks segment, as discussed above. See further discussion in the Segment Results of Operations section below.

Previous wording

Other. Other direct operating expense in the three months ended September 30, 2024 includes rent cost for production facilities that were unutilized as a result of the industry strikes amounting to $5.2 million, which was not allocated to the segments, and is included in direct operating expense. In addition, other direct operating expense in the three months ended September 30, 2024 and 2023 includes share-based compensation.

Current wording

Other. Other direct operating expense in the three months ended December 31, 2024 includes rent cost for production facilities that were unutilized as a result of the industry strikes amounting to $4.1 million, which was not allocated to the segments, and is included in direct operating expense. In addition, other direct operating expense in the three months ended December 31, 2024 and 2023 includes share-based compensation.

Previous wording

Distribution and marketing expenses decreased in the six months ended September 30, 2024, due to lower Studio Business and Media Networks distribution and marketing expense. The decrease at the Studio Business primarily reflects lower Motion Picture theatrical P&A and Premium VOD expense associated with the theatrical slate releases in the current period. The decrease in Media Networks distribution and marketing expense was due to a decrease of $22.2 million primarily from the international territories exited, and a decrease at Starz Networks of $4.1 million. See further discussion in the Segment Results of Operations section below.

Current wording

Distribution and marketing expenses decreased in the three months ended December 31, 2024, due to lower Studio Business and Media Networks distribution and marketing expense. The decrease at the Studio Business primarily reflects lower Motion Picture theatrical P&A and Premium VOD expense associated with the theatrical slate releases in the current quarter, and lower Motion Picture home entertainment expense. The decrease in Media Networks distribution and marketing expense was due to a decrease at Starz Networks of $10.2 million, and a decrease of $5.6 million primarily from the international territories exited. See further discussion in the Segment Results of Operations section below.

Previous wording

General and administrative expenses decreased in the three months ended September 30, 2024, resulting from decreased share-based compensation expense, corporate and Studio Business general and administrative expense, and purchase accounting and related adjustments, partially offset by increased Media Networks general and administrative expenses. Studio Business general and administrative expenses for the three months ended September 30, 2024 included approximately $6.0 million from eOne. See further discussion in the Segment Results of Operations section below.

Current wording

General and administrative expenses decreased in the three months ended December 31, 2024, resulting from decreased share-based compensation expense, Studio Business, corporate, and Media Networks general and administrative expense. Studio Business general and administrative expenses for the three months ended December 31, 2024 included approximately $5.1 million from eOne. See further discussion in the Segment Results of Operations section below.

Previous wording

Corporate general and administrative expenses decreased $4.7 million, or 14.3%, primarily due to a decrease in incentive based compensation, partially offset by an increase in professional fees and approximately $3.0 million of corporate general and administrative expenses from eOne.

Current wording

Corporate general and administrative expenses decreased $2.7 million, or 8.7%, primarily due to a decrease in incentive based compensation, partially offset by approximately $3.0 million of corporate general and administrative expenses from eOne.

Previous wording

Purchase accounting and related adjustments include the expense associated with the noncontrolling equity interests in the distributable earnings related to 3 Arts Entertainment, and the non-cash charge for the amortization of the recoupable portion of the purchase price related to 3 Arts Entertainment, all of which are accounted for as compensation and are included in general and administrative expense. The noncontrolling equity interests in the distributable earnings of 3 Arts Entertainment are reflected as an expense rather than noncontrolling interest in the unaudited condensed consolidated statement of operations due to the relationship to continued employment. Purchase accounting and related adjustments decreased $0.5 million, or 22.7%, primarily due to lower noncontrolling equity interests in the distributable earnings related to 3 Arts Entertainment of $0.5 million associated with a lower noncontrolling interest ownership percentage as a result of our acquisition of an additional interest in 3 Arts Entertainment (see Note 9 to our unaudited condensed consolidated financial statements).

Current wording

Purchase accounting and related adjustments include the expense associated with the noncontrolling equity interests in the distributable earnings related to 3 Arts Entertainment, and the non-cash charge for the amortization of the recoupable portion of the purchase price related to 3 Arts Entertainment, all of which are accounted for as compensation and are included in general and administrative expense. The noncontrolling equity interests in the distributable earnings of 3 Arts Entertainment are reflected as an expense rather than noncontrolling interest in the unaudited condensed consolidated statement of operations due to the relationship to continued employment. Purchase accounting and related adjustments were comparable to the prior year's quarter (see Note 9 to our unaudited condensed consolidated financial statements).

Previous wording

Depreciation and Amortization Expense. Depreciation and amortization of $45.5 million in the three months ended September 30, 2024 increased $0.9 million from $44.6 million in the three months ended September 30, 2023 due to increased amortization of intangible assets.

Current wording

Depreciation and Amortization Expense. Depreciation and amortization of $43.8 million in the three months ended December 31, 2024 decreased $6.1 million from $49.9 million in the three months ended December 31, 2023 due to lower depreciation expense.

Previous wording

Restructuring and Other. Restructuring and other decreased $216.0 million in the three months ended September 30, 2024 as compared to the three months ended September 30, 2023, and includes restructuring and severance costs and certain transaction and other costs, when applicable. Restructuring and other costs were as follows for the three months ended September 30, 2024 and 2023 (see Note 14 to our unaudited condensed consolidated financial statements):

Current wording

Restructuring and Other. Restructuring and other decreased $73.6 million in the three months ended December 31, 2024 as compared to the three months ended December 31, 2023, and includes restructuring and severance costs and certain transaction and other costs, when applicable. Restructuring and other costs were as follows for the three months ended December 31, 2024 and 2023 (see Note 14 to our unaudited condensed consolidated financial statements):

Previous wording

(1)Media Networks Restructuring: As discussed in "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations - Overview", the Company recorded net recoveries of content impairment charges related to the Media Networks segment in the three months ended September 30, 2024 of $4.3 million (three months ended September 30, 2023 - content impairment charges of $211.6 million). See Note 14 to our unaudited condensed consolidated financial statements.

Current wording

(1)Media Networks Restructuring: As discussed in "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations - Overview", the Company recorded net recoveries of content impairment charges related to the Media Networks segment in the three months ended December 31, 2024 of $6.4 million (three months ended December 31, 2023 - the Company recorded content impairment charges related to the Media Networks segment of $77.8 million). Subsequent to December 31, 2024, the Company removed programming on Starz's domestic platform which had a carrying value of approximately $77.4 million, which charge, measured as the excess of the carrying value over the fair value of the titles removed, will be recorded during the fourth quarter ending March 31, 2025. See Note 14 to our unaudited condensed consolidated financial statements.

Previous wording

Interest Expense. Interest expense of $74.3 million for the three months ended September 30, 2024 increased $10.5 million from the three months ended September 30, 2023 due to higher average interest rates and balances on variable rate corporate debt and film related obligations, partially offset by a slightly larger benefit from the interest rate swaps. The following table sets forth the components of interest expense for the three months ended September 30, 2024 and 2023:

Current wording

Interest Expense. Interest expense of $69.1 million for the three months ended December 31, 2024 increased $2.0 million from the three months ended December 31, 2023 due to higher average balances on variable rate corporate debt and film related obligations and a smaller benefit from the interest rate swaps, partially offset by lower average interest rates. The following table sets forth the components of interest expense for the three months ended December 31, 2024 and 2023:

Previous wording

Interest and Other Income. Interest and other income of $3.3 million for the three months ended September 30, 2024 increased as compared to interest and other income of $2.7 million for the three months ended September 30, 2023 due to higher interest income.

Current wording

Interest and Other Income. Interest and other income of $3.1 million for the three months ended December 31, 2024 increased as compared to interest and other income of $1.8 million for the three months ended December 31, 2023 due to higher interest income.

Previous wording

Other Expense. Other expense of $15.7 million for the three months ended September 30, 2024 increased as compared to other expense of $11.5 million for the three months ended September 30, 2023. The increase is primarily due to realized and unrealized foreign currency losses in the three months ended September 30, 2024, offset by a decrease in the loss recorded related to our monetization of accounts receivable programs in the three months ended September 30, 2024 as compared to the three months ended September 30, 2023 (see Note 18 to our unaudited condensed consolidated financial statements).

Current wording

Other Gains (Losses), net. Other gains (losses), net represented a gain of $8.4 million for the three months ended December 31, 2024 as compared to a loss of $2.5 million for the three months ended December 31, 2023. The change is primarily due to foreign currency gains in the three months ended December 31, 2024, partially offset by an increase in losses recorded related to our monetization of accounts receivable programs in the three months ended December 31, 2024 as compared to the three months ended December 31, 2023 (see Note 18 to our unaudited condensed consolidated financial statements).

Previous wording

Loss on Extinguishment of Debt. Loss on extinguishment of debt of $0.5 million in the three months ended September 30, 2024 related to the write-off of debt issuance costs associated with the voluntary prepayment of $355.1 million principal amount of the Term Loan B. There was no comparable loss on extinguishment of debt in the three months ended September 30, 2023. See Note 6 to our unaudited condensed consolidated financial statements.

Current wording

Loss on Extinguishment of Debt. Loss on extinguishment of debt of $0.3 million in the three months ended December 31, 2024 related to the write-off of debt issuance costs associated with the voluntary prepayment of $250.0 million principal amount of the Term Loan B. There was no comparable loss on extinguishment of debt in the three months ended December 31, 2023. See Note 6 to our unaudited condensed consolidated financial statements.

Previous wording

Loss on Investments, net. Loss on investments, net was nil for the three months ended September 30, 2024, as compared to $1.6 million for the three months ended September 30, 2023 related to other investments.

Current wording

Gain on Investments, net. Gain on investments, net was nil for the three months ended December 31, 2024, as compared to $4.4 million for the three months ended December 31, 2023 related to other investments.

Previous wording

Equity Interests Income (Loss). Equity interests loss of $0.1 million in the three months ended September 30, 2024 compared to equity interests income of $1.8 million in the three months ended September 30, 2023 due to lower income generated by our equity method investees.

Current wording

Equity Interests Income. Equity interests income of $7.6 million in the three months ended December 31, 2024 compared to equity interests income of $4.2 million in the three months ended December 31, 2023 due to higher equity interest income in the current quarter.

Previous wording

Income Tax Benefit (Provision). We had an income tax provision of $1.9 million in the three months ended September 30, 2024, compared to an income tax benefit of $2.0 million in the three months ended September 30, 2023. Our income tax provision differs from the U.S. federal statutory income tax rate of 21% multiplied by income (loss) before taxes due to the mix of our earnings across the various jurisdictions in which our operations are conducted, changes in valuation allowances against our deferred tax assets, and certain minimum income and foreign withholding taxes. Our income tax provision for the three months ended September 30, 2024 and 2023 was also impacted by charges for interest on uncertain tax benefits.

Current wording

Income Tax Provision. We had an income tax provision of $4.0 million in the three months ended December 31, 2024, compared to an income tax provision of $4.7 million in the three months ended December 31, 2023. Our income tax provision differs from the U.S. federal statutory income tax rate of 21% multiplied by income (loss) before taxes due to the mix of our earnings across the various jurisdictions in which our operations are conducted, changes in valuation allowances against our deferred tax assets, and certain minimum income and foreign withholding taxes. Our income tax provision for the three months ended December 31, 2023 was also impacted by charges for interest on uncertain tax benefits.

Previous wording

Net Income (Loss) Attributable to Lions Gate Entertainment Corp. Shareholders. Net loss attributable to our shareholders for the three months ended September 30, 2024 was $163.3 million, or basic and diluted net loss per common share of $0.68 on 239.3 million weighted average common shares outstanding. This compares to net loss attributable to our shareholders for the three months ended September 30, 2023 of $886.2 million, or basic and diluted net loss per common share of $3.79 on 234.0 million weighted average common shares outstanding.

Current wording

Net Loss Attributable to Lions Gate Entertainment Corp. Shareholders. Net loss attributable to our shareholders for the three months ended December 31, 2024 was $21.9 million, or basic and diluted net loss per common share of $0.09 on 240.2 million weighted average common shares outstanding. This compares to net loss attributable to our shareholders for the three months ended December 31, 2023 of $106.6 million, or basic and diluted net loss per common share of $0.45 on 235.1 million weighted average common shares outstanding.

Previous wording

Revenue. The table below sets forth Motion Picture revenue by media and product category for the three months ended September 30, 2024 and 2023. Motion Picture revenues for the three months ended September 30, 2024 included approximately $15.6 million of revenues from eOne.

Current wording

Revenue. The table below sets forth Motion Picture revenue by media and product category for the three months ended December 31, 2024 and 2023. Motion Picture revenues for the three months ended December 31, 2024 included approximately $12.6 million of revenues from eOne.

Previous wording

Theatrical revenue decreased $8.1 million in the three months ended September 30, 2024 as compared to the three months ended September 30, 2023 due to a decrease of $9.0 million from Lionsgate Original Releases due to greater revenue generated from the fiscal 2024 theatrical slate titles in the prior year as compared to the fiscal 2025 theatrical slate titles in the current year.

Current wording

Theatrical revenue decreased $65.1 million in the three months ended December 31, 2024 as compared to the three months ended December 31, 2023 due to a decrease of $64.8 million from Lionsgate Original Releases due to significant revenue in the prior year's quarter from the release of The Hunger Games: The Ballad of Songbirds & Snakes.

Previous wording

Home entertainment revenue decreased $54.8 million, or 30.1%, in the three months ended September 30, 2024, as compared to the three months ended September 30, 2023, due to lower digital media revenue of $51.2 million primarily due to decreases from Lionsgate Original Releases. Digital media revenue from Lionsgate Original Releases declined $43.0 million due to digital media revenue in the prior year's quarter from our fiscal 2023 and prior theatrical slate titles, and in particular, John Wick: Chapter 4 and Jesus Revolution, which compared to lower revenue in the current quarter from our fiscal 2024 and prior theatrical slate titles. The decrease in digital media revenue was also due to a decrease from Other Film of $8.2 million from our acquired library titles.

Current wording

Home entertainment revenue decreased $14.8 million, or 8.4%, in the three months ended December 31, 2024, as compared to the three months ended December 31, 2023, due to lower digital media revenue and packaged media revenue of $9.8 million and $5.0 million, respectively, primarily due to decreases from Lionsgate Original Releases. Digital media revenue from Lionsgate Original Releases declined $19.3 million due to significant revenue in the prior year's period from titles in the The Hunger Games franchise, partially offset by an increase in Other Film of $9.5 million from our acquired library titles.

Previous wording

Television revenue increased $7.9 million, or 7.8%, in the three months ended September 30, 2024, as compared to the three months ended September 30, 2023, due to an increase from Lionsgate Original Releases of $6.4 million due to a greater number of television windows opening in the current quarter for our theatrical slate titles.

Current wording

Television revenue decreased $27.0 million, or 41.3%, in the three months ended December 31, 2024, as compared to the three months ended December 31, 2023, due to a decrease from Lionsgate Original Releases of $29.2 million due to a greater number of television windows opening in the prior year's quarter for our theatrical slate titles.

Previous wording

Direct Operating Expense. The increase in direct operating expenses is due to greater direct operating expenses as a percentage of motion picture revenue as compared to the prior year's quarter, driven by the change in the mix of titles and product categories generating revenue. In particular, the increase was driven by the performance and cost of the titles released in the quarter, including Borderlands, which had a higher amortization rate as compared to the titles released in the prior year's quarter. Investment in film write-downs included in Motion Picture segment direct operating expense were $18.3 million in the three months ended September 30, 2024, compared to approximately $26.8 million in the three months ended September 30, 2023.

Current wording

Direct Operating Expense. The decrease in direct operating expenses is due to lower Motion Picture revenue. The decrease in direct operating expenses as a percentage of motion picture revenue as compared to the prior year's quarter was driven by the change in the mix of titles and product categories generating revenue, and in particular, the current quarter reflected a lower amortization rate and greater portion of revenue from library titles relative to the prior year's quarter. Investment in film write-downs included in Motion Picture segment direct operating expense were approximately $0.2 million in the three months ended December 31, 2024, compared to approximately $0.5 million in the three months ended December 31, 2023.

Previous wording

Distribution and Marketing Expense. The increase in distribution and marketing expense in the three months ended September 30, 2024 is due to higher theatrical P&A and Premium VOD expense due to higher expense associated with the theatrical slate releases in the current quarter. In the three months ended September 30, 2024, approximately $15.4 million of theatrical P&A and Premium VOD expense was incurred in advance for films to be released in subsequent quarters, compared to approximately $15.2 million in the prior year's quarter in the Motion Picture segment.

Current wording

Distribution and Marketing Expense. The decrease in distribution and marketing expense in the three months ended December 31, 2024 is due to lower theatrical P&A and Premium VOD expense associated with the theatrical slate releases in the current quarter, and lower Motion Picture home entertainment expense. In the three months ended December 31, 2024, approximately $22.1 million of theatrical P&A and Premium VOD expense was incurred in advance for films to be released in subsequent quarters, compared to approximately $10.5 million in the prior year's quarter in the Motion Picture segment.

Previous wording

Revenue. The table below sets forth Television Production revenue and changes in revenue by media for the three months ended September 30, 2024 and 2023. Television Production revenues for the three months ended September 30, 2024 included approximately $111.1 million of revenues from eOne.

Current wording

Revenue. The table below sets forth Television Production revenue and changes in revenue by media for the three months ended December 31, 2024 and 2023. Television Production revenues for the three months ended December 31, 2024 included approximately $114.3 million of revenues from eOne.