Starz Entertainment Corp.

Good day, and thank you for standing by. Welcome to the STARS second quarter 2026 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Nilay Shah, Head of Investor Relations. Please go ahead.

Thank you for joining us for Starz Entertainment's second quarter 2026 earnings call. We'll begin with opening remarks from our President and CEO, Jeffrey Hirsch, followed by remarks from our CFO, Scott MacDonald. Also joining us on the call today is Alison Hoffman, President of Starz Networks. After our opening remarks, we'll open the call for questions. The matters discussed on this call include forward-looking statements, including those regarding expected future performance. 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 most recently filed 10-KT for Stars Entertainment Corp. Starz undertakes no obligation to update these forward-looking statements due to new information or any future events unless required by law. The matters discussed today will also include non-GAAP financial measures and key performance indicators. These non-GAAP measures include adjusted EBITDA, unlevered free cash flow, equity free cash flow, and net debt. The reconciliation for these to the most directly comparable U.S. GAAP measures and additional required information is available in the 8K we filed this morning, which is available on the STARS Investor Relations website at investors.stars.com. This non-GAAP financial information is not intended to be considered in isolation or as a substitute for financial information presented in accordance with U.S. GAAP. I'll now turn the call over to Jeff.

Thank you, Nilay, and thank you all for joining us this morning. We delivered another strong quarter and entered the back half of 2026 with significant momentum across the business. We just completed a strong weekend with the penultimate episode of Raising Canaan Season 5 and the premiere of our first owned original, Fightland. Raising Canaan delivered the strongest episode of the season. Most notably, Season 5 has grown its audience from the first season five years ago, a rare achievement in today's television landscape. and I'm happy to report that Fightland premiered as Star's second best rated new IP launch of all time. Its opening weekend demonstrates significant audience overlap with the Power Universe, which will expand audience engagement and reduce subscriber churn. Now turning to the quarter. Our excellent second quarter results were driven by the finale of Outlander, the premiere of Raising Canaan Season 5 and The Housemaid. The content portfolio in the quarter generated the second highest audience engagement quarter of all time. This marks the fourth consecutive quarter of engagement growth since we separated. Consumer demand for our content, coupled with the results of our rate increase, delivered significant sequential OTT revenue growth. And perhaps more importantly, we returned to year-over-year OTT revenue growth in the quarter. Total revenue also increased sequentially in the quarter despite a difficult comparison to the first quarter. We expect this revenue trend to continue, putting us on a solid path toward achieving our outlook of positive annual OTT revenue growth in 2026. The strength of the quarter, our improved visibility into the second half of the year, and the early performance of Fightland increase our confidence that 2026 is shaping up to be a more significant inflection year for STARS than we initially anticipated. As a result, we are now raising our adjusted EBITDA growth forecast and our unleveraged free cash flow guidance, which Scott will get into in more detail. We also continue to see a clear and accelerating path toward our leveraged target and our 20% margin target, supported by improved OTT economics, greater scale and owned content, and continued operating discipline. Looking ahead, our content slate supports the momentum we are seeing across the business and positions us well for updated outlook. We have the highly anticipated return of P-Valley, the continued expansion of the Outlander universe through Blood of My Blood Season 2, and the upcoming Michael biopic following its impressive theatrical run. Further out, we continue to build our own content pipeline beyond Fightland with the Untitled Black Rodeo Show starting production this month and several other Starz-owned projects in development. During the quarter, we also made significant strides in the distribution side of the business. We have secured a long-term renewal with one of our largest distribution partners while expanding our fully distributed portfolio with two new partners. First, we launched a new partnership with Peacock during the quarter, making Stars available as an add-on subscription to the platform for the first time. This partnership allows us to market Stars to an additional 48 million subscribers, creating a new opportunity for customer acquisition and revenue growth. Second, we recently announced a new bundle with Crunchyroll on Prime Video, further demonstrating our ability to reach highly engaged audiences through targeted partnerships. Together, these relationships expand our distribution footprint, increase awareness of the Starz brand, and support our growth strategy while allowing us to reach large audiences without incremental platform investments. As our core business continues to strengthen and progress toward our goals of 20% adjusted OEBIDA margin, delevering, and increasing unlevered free cash flow conversion, we have the flexibility to be selective as we evaluate strategic initiatives. Our priority remains executing against our operating plan. We will only pursue M&A where it accelerates our strategy and creates value beyond what we could achieve organically. The progress we are reporting today is not being driven by a single title, a single partnership or a single quarter. It is the direct result of disciplined execution against the priorities we use to manage the business. Growing OTT revenue, expanding profitability, improving free cash conversion and reducing leverage. We have built a stronger business with a deeper and more balanced content slate, and we continue to create value through ownership, partnerships, and disciplined capital allocation. With that, I will turn it over to Scott to take you through the financial details and our updated outlook.

Thank you, Jeff, and good morning, everyone. I'm pleased to report that the second quarter was another strong quarter during which we delivered on or ahead of our expectations. Our financial story is simple, growing OTT revenue, expanding adjusted to IBDA, generating meaningful free cash flow, and reducing leverage. Based on our second quarter performance, we are updating our full year guidance across several of these metrics, which I will walk through during my remarks. Total revenue in the second quarter was $308 million. OTT revenue was $221 million, growing year over year for the first time since the fourth quarter of 2024 and giving a strong momentum entering the back half of the year. On a comparative basis, the year-over-year growth in OTT revenue was negatively impacted by 3 million of OTT revenue related to our Canadian operations reflected in Q2 2025. On a pro forma basis, excluding this 3 million, OTT revenue would have increased by 1.4% this quarter. As a reminder, we transitioned our Canadian operations from a distribution partnership with Bell to a content licensing model at the end of 2025. ARPU continued to improve in Q2 as the April price increase flowed through the base. We expect further ARPU expansion in the second half of 2026 as additional promotional cohorts convert to retail rates. Importantly, the revenue improvement we are seeing this quarter is coming through both better pricing and increased subscribers, not one at the expense of the other, which is exactly the balance we set out to strike. and other revenue was $87 million, reflecting the continued secular pressure on traditional video households we've discussed on prior calls. Adjusted to IBDA was $60 million for the quarter, ahead of our expectations. From a quarterly cadence perspective, we expect Q3 Adjusted to IBDA to be in the mid-30s. This will be our lowest quarter of the year due to higher programming amortization from the airing of Raising Canaan Season 5, Fightland Season 1, and Blood of My Blood Season 2 all during Q3. We expect Q4 to finish the year strongly in the mid-60s. Accordingly, we are raising our 2026 adjusted OIBDA growth guidance from low single digits to mid single digits, and we remain confident in achieving our 20% adjusted OIBDA margin target in the back half of 2027. Unlevered free cash flow was negative $15 million in the second quarter and positive $66 million year-to-date. Equity-free cash flow was negative $33 million in the quarter and positive $35 million year-to-date. As noted last quarter, we expected free cash flow to be negative in Q2, given the timing of content payments. And while that timing dynamic did play out, our free cash flow still came in ahead of our expectations. The free cash flow inflection we've guided to all year is materializing, and we are raising our unlevered free cash flow outlook to the mid to upper end of our previously provided $80 million to $120 million range. Conversion of Adjusto IBDA to unlevered free cash flow remains on track against our 70% target. Cash content spend was $182 million for the quarter. Now that we have exited the universal pay-to agreement, we expect to report full-year cash content spend below $600 million on our cash flow statement and see continued improvement in the convergence of cash content spend and programming amortization this year. Net debt was $566 million as of June 30, 2026, and our adjusted OIBDA leverage ratio was 2.9 times. Our revolver remains undrawn and we continue to maintain significant liquidity and financial flexibility. Today, I am pleased to announce that we have obtained firm commitments to increase our credit facilities by $100 million, comprised of a $67 million increase to our Term Loan A and a $33 million increase to our revolver, which we expect to close in the third quarter. Importantly, this transaction is not being undertaken to fund operations or support liquidity needs. Rather, it allows us to replace the remaining balance of our programming notes, which are working capital facilities that carry significantly higher interest costs than our credit facilities. By refinancing these obligations into lower cost corporate debt, we expect to improve annual free cash flow by approximately $4 million through lower cash interest expense while simplifying our capital structure. More importantly, even after incorporating this additional $67 million of term debt, we still expect to end 2026 with leverage of approximately 2.7 times. Put differently, the underlying deleveraging occurring in the business is even stronger than our expected year-end leverage ratio would suggest. Absent this refinancing transaction, year-end leverage would be meaningfully lower by approximately 0.3 times, underscoring the strength of our adjusted derivative growth and free cash flow generation. As a result, we remain highly confident in the path toward 2.5x leverage and below and believe the combination of growing adjusted OIBDA, increasing free cash flow, and lower financing costs will continue to strengthen our balance sheet over time. As a reminder, the agreement to exit the Universal Pay 2 was signed in April 2026. Thus, we recorded the associated restructuring charge of $147 million this quarter rather than in the March quarter. We continue to expect this to be the final content restructuring charge of this magnitude going forward, which sets the company up for meaningfully lower restructuring activity from here. Given the timing of our final cash payments to Universal in 2028, we believe 2029 is shaping up to be a significant year for free cash flow growth relative to the trajectory we see across 2026 through 2028. The financial story for Starz is getting stronger and simpler every quarter, growing OTT revenue, expanding margins. growing free cash flow and reducing leverage. We're confident in our trajectory and we look forward to continuing to demonstrate our progress. Now we'll turn the call back over to Nilay for Q&A.

Thanks, Scott. Operator, can we open the call up for Q&A, please?

Thank you. As a reminder to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. One moment, please, for the Q&A roster to compile. Our first question comes from the line of Vikram Kesavar-Padla with Baird. Your line is now open.

Okay, great. Hey, thanks for taking the question, and good morning, everybody. Hey, my first one is on Fightland. Could you talk more about what you observed from the launch, particularly around customer acquisition and engagement, and what else is standing out to you so far as you reflect on the feedback and observe some of the early patterns of your members?

Good morning, Vic. It's Jeff. I'll start and I think Allie will jump in. We're really excited. As I said in my prepared remarks, it's the second best premiere of new IP in the history of Starz. The social sentiment has been great and improving. I think the fan base is absolutely loving it. And it's doing exactly what we designed it to do, which is to serve the audience that we have. Thank you for joining us.

That should play out in great post-season churn from a Power Universe perspective, and we'll see that through the business. I would also say from an acquisition perspective, really seeing an influx of win-backs or lapsed users coming back to the platform. That was really great to see. We just had a massive weekend last weekend with Fightland getting off to a great start, really buoyed by the Kanan penultimate episode.

Okay, great. Thanks for the color there. And then separate from that, I also want to ask about this recently announced licensing deal for the Power Universe to join Netflix later this year. Obviously, it sounds like the Power Library will continue to be on Starz going forward as well. So with that in mind, could you just talk about what the potential implications of that deal could be for Starz and some of the opportunities that could ultimately present for you?

Yeah, I think, you know, we feel that, you know, when a mature show like Power, the original Power, which has been essentially in syndication for many years, it was on Hulu, now it's on Netflix, you know, goes to a bigger platform like that, it creates an opportunity for us. You know, it's a way for us to introduce the franchise to new audiences and new viewers and really reinvigorate. As a reminder, though, you know, we are the exclusive home of the Power universe. We have exclusive rights to all of the sequels, prequels, spinoffs. And it is the recent installments that are really driving the business, right, in terms of engagement, in terms of first title streams, subscriber acquisition. So, yeah, we think it's a good thing. It is part of our strategy as programming gets mature. We think that syndication model actually works for us.

Okay, great. Thanks, everyone. I appreciate it.

Thank you. Our next question comes from the line of Brent Pinter with Raymond James & Associates. Your line is now open.

Hey, good morning, everyone. First question, sort of a follow-up on that. As you move to owning your own series, you've talked about the cost savings and the international licensing piece. I don't want to get ahead of ourselves, but top of mind with the Netflix power deal, As we look down the road, do you see opportunity to take advantage of those same kinds of deals for the library of own titles that you're building?

Hey, Branch, Jeff. Yeah, look, I think that's part of a big piece of our strategy of rebuilding our content library and getting ownership back on the network is building volume and scale with the franchises that we will then launch and sell internationally. As you know, Sky is the co-commission partner in the UK. I think we'll have some more announcements from the rest of the world around Fightland. which will bring that per episode cost down even further. And I think as we build our slate back and get volume, it gives us opportunities to do output deals around the world that is much more of an MG type basis than a one-off. And then ultimately in the second window, the ability to sell those as they get older and we see less value for them on the core business to monetize them in that second window.

Yep, makes sense. And then on the universal pay-to-window exit, Any way you can quantify what portion of viewership or engagement on Starz came from those titles?

Yeah, so we haven't aired those titles in almost a year and a half because we were working with Universal to sell them, so we wanted to keep them fresh. So there is absolutely almost zero viewership or engagement tied to those titles. When we had it on the air, what we saw, like I said, on previous quarters, we were paying pay-to prices for library performance. and so we've been able to reinvest some of the savings into buying library to actually drive more engagement and as I said in my prepared remarks, this quarter was our second highest engagement quarter of all time and so we had a great first quarter. We're accelerating to the second quarter here on engagement and so we feel like we're in a really good place and it was the right decision based on the performance of the titles than we had it in 24 and 25. Okay, great and then Jeff,

You talked about the ability to be selective with strategic initiatives, and in the past you've talked about the value of the AVOD and SVOD platform you've built on STARS. Can you update us on any conversations you all are having on that front, on any of those strategic initiatives?

Yeah, look, I'm not going to get into any detail on any of those strategic conversations. I think what I will say, as I said in my prepared remarks, Scott MacDonald, Jennifer Minezaki-Washington, Karen Bailey, Great. Thank you very much.

Thank you. Our next question comes from the line of David Joyce with Seaport Research Partners. Your line is now open.

Thank you. Could you please help us understand what the subscriber trends have been like? I know it's not something that you've been publishing regularly, but how is it looking year over year and into this new quarter? Also, if you could drill down some more on the cash content spend versus amortization as it pertains to the free cash flow cadence, especially as we get into that 2029 inflection point you mentioned. Thank you.

Hey, David. Thanks for the question. As we said, we're not really reporting subscribers, but what I would say is the business continues to grow. I think Scott said it pretty well in his prepared remarks that you can't just grow the business on rates. We're really excited about the Peacock deal because that gives us access to 48 million subscribers that we haven't had access to in a very simple and easy and consumer frictionless way to grow our business. If you look at our other mature distribution partners, we're anywhere between 14 to 22 percent penetrated. So think about what that could mean on a base of 48 million as we grow that over time. So I think we could grow the business just on Peacock alone over the next couple of years from a subscriber basis. But what I would say is total subscribers in the quarter were up even in the face of a rate increase, which is very rare. So there's real strength of the business on both sides of the revenue equation.

David, this is Scott.

We are really comfortable in coming in below $600 million on overall content spend for this year. And we kind of see below $600 million as the trend going forward. It's kind of a combination of the universal deal you know the pay to exit as well as as Jeff mentioned the getting the ownership economics on our originals you know where you see two to two and a half million you know lower cost per episode which is meaningful when you look at the number of episodes we do a year so we're very comfortable with that and what will happen as we move forward you know we're comfortable hitting the mid to upper end of our adjusted OIBDA target of 80 to 120 million and As I mentioned earlier, content payments were really like Q1. We caught that up in Q2, and we see positive for the rest of the year there, growing into 27, 28. But when you get to 2029, there'll really be a huge inflection point as the universal payments will be done then. So you should think of equity-free cash flow of over 70%. and Unlevered exceeding 90%. As a reminder, we have very small CapEx, about less than $20 million a year, and we, with our NOL position, don't expect to be a taxpayer. So we feel really good about how our free cash flow is going to go here over the next few years. Great. Thank you very much.

Thank you. Our next question comes from the line of Drew Crum with B Raleigh Securities, Inc. Your line is now open. Okay, thanks.

Good morning, everyone. So, you know, with you reaffirming the positive revenue growth for OTT, it being down, I think, 3% year-to-date, how are you thinking about the shape or quarterly phasing in the second half? I know you gave some commentary around OIBDA in 3Q and 4Q, but asking specifically about OTT revenue. Thanks.

I think we're going to continue to see OTT revenue grow sequentially through the back half of the year and into next year. And we feel very confident and very positive about that. The trends we're seeing, Fightland off to a great start. We've got Michael coming on, as we said. We've got P-Valley, which is one of our biggest shows, coming back. And I think one of the really great things about Fightland this past weekend is that we were acquiring subs at $6.00. and historically when we were reporting subs and in that quarterly cadence of subs you know we would have been probably acquiring at two to three dollars and so we're seeing strong ARPU growth we're seeing great sub growth and the content is working which is you put those three things together with the slate going forward we feel very confident in the revenue trajectory for the rest of the year.

Thanks for that Jeff and just can you remind us the timing of Michael on the platform that's 3Q and is that revenue flow in the third quarter or is it

It will premiere on the platform August 10th.

Okay. All right. Thanks, guys.

Thank you. Our next question comes from the line of David Karnofsky with JP Morgan. Your line is now open.

Hey, thanks, Jeff. Maybe just one on distribution. You know, we saw Peacock recently do a deal with YouTube Premium for their platform to get ingested into the bundle. I'm just curious what you make of that arrangement, whether you've ever thought of something similar for Starz. Thank you.

It's a great question. I think as we've talked a lot over the last 10 years, Starz has always been this premium add-on to broad-based distribution platforms. We were always sold on top of Comcast. We were sold on top of DirecTV. and many more. Broad Bay Streamers out there. We're sold on top of Amazon. We're sold on top of Hulu. We're now sold on top of Peacock. I think you'll see that continue. We think that's why the Warner Brothers and Paramount deal is such a good deal for not only the consumer but for independents like us because it gives us, again, another platform to be sold on top of. We're supportive of that deal as well. I think the deal you saw with Peacock and YouTube is just the next step in As Ali likes to say, it's going from bundling to packaging and recreating what we used to have in the old linear business, and that is really good for the stars business.

Thank you.

Thank you. Our next question comes from the line of Sean Diffley with Morgan Stanley. Your line is now open.

Great. Thanks very much, team. I was hoping you could unpack some of the details on how this price hike compares to prior cycles. It sounds like it's going better given the content slate success, but how you're thinking about your pricing power relative to other streaming services. And then second question on capital allocation, as you've outlined, there's a clear path to more free cash flow generation. It seems like de-levering is still a focus, but is there a path to doing buybacks or are you saving cash to reinvest or potential M&A? How should we think about capital allocation from here? Thanks.

Yeah, thanks, Sean. I'll start with the rate increase. We're really proud of how the team has managed and defended the rate increase. As you noted, we're seeing disconnects are significantly lower than the last time we executed a rate increase. You should know also it is pretty much flowed through At this point on the streaming side, we have a little bit more to go on the linear affiliates who are participating, but we've really sort of managed and digested that rate increase at this point. And despite the increase, we're seeing record low churn in the business. And I think, you know, that does speak to the power of the slate, the engagement trends that we're seeing in the business. So, you know, we do feel that we have that. We're at the right price in the ecosystem and we feel really good about it.

In terms of capital allocation, it's a great question. I think you saw in Scott's prepared remarks, we were able to upsize the revolver and the term loan, and we're still confident of getting to that 2.7, which means the underlying business is actually delevering faster than what we have, and so we feel really good about that. and you know we think we get that path to two and a half percent is going to come much sooner than we thought it would originally and when we get there I think we'll have a conversation and we you know the board I think we'll have a pretty robust conversation about what we'll do there and you know that's a good problem for us to have and so we'll have that conversation when we get there.

Thank you. Our next question comes from the line of Matthew Harrigan with Benchmark Stonex. Your line is now open.

Thank you. I guess I'll try to turn this call into a little bit of a PN to Lionsgate Fightland. You were actually running an advertising on Bloomberg and CNBC, and I thought it was really appealing. And I know surprisingly, you know, Bloomberg has actually had programming with the cast on some of their cultural segments. And, you know, it seems like something that could really have a lot of crossover appeal, and clearly the law of small numbers or large numbers, depending how you work on, look at it, it really would afford a lot of operating leverage. When you look at your subscribers, and I know you probably won't give out the exact percentages, but when you look at the urban and the diff staff side, is that really the great majority of the viewers? And if you really do have a crossover hit where everybody... Working in Manhattan suddenly wants to watch Fightland. Isn't that something that could be pretty transformative in terms of increasing the bundling appeal and even just getting, as you commented, more standalone OTT acquisitions? Thanks.

Yeah, I mean, look, I think we've always had a large portion of our customer base set in New York. I mean, the power shows have been set in New York. We shoot them in New York. you know we are you know if you look at even DC there's a large huge following of the power shows you know whether it's to the CBC or you know Speaker Jeffries and so there's a large portion of this country that really is obsessed with our franchises and so we thought it would be really good to you know to try to expand a little bit Fightland's a little different than we've had because it brings the UK involved it brings boxing involved and so it's I think we can expand the footprint and the subscriber base through that show and what we're seeing early on is just that right and you know as Ali said we're seeing it with Winback where we engage in customers that have you know have lapsed over a period of time because of you know either they left their power franchise or you know they just you know couldn't stomach the original OG ghost dying as you've seen a lot socially and so we just thought that as you start to bring new content in that is Designed for the audience but feels a little different that we'll start to actually market and put the shows in different places. I think you'll see that with the Black Rodeo show. It's similar to P-Valley in the sense that it's shot in the South, but it brings in a whole element of the Black Rodeo, which is a real important thing in the South right now that you see throughout Texas. And so I think there's more opportunity to expand the footprint and expand the subscriber base around shows that are designed for the core audience but are different stories and different accesses to different aspects of the world that are real live today that people haven't seen. And we saw that with P-Valley on scale. Great, thank you.

Thank you. Our next question is a follow-up from Vikram Kasavapadla with Baird. Your line is now open.

Yeah, hey, thanks for letting me ask a couple more questions here. I wanted to follow up on the partnership agreement with Crunchyroll. What did you find appealing about that deal and how should we expect your broader approach to bundling to evolve going forward? and then separate from that, it sounds like you're optimistic about the opportunities from this recent Peacock Agreement as well. I'm curious if you see other opportunities to further expand your distribution with deals like that one and if there's anything else on the horizon that we should be looking for.

Yeah, I think, you know, Crunchyroll is really interesting to us because we have, we both have powerful engaged fan bases and they're differentiated. So it's an opportunity to really mine a new audience, I think, for both partners. We have been really aggressive in the bundling space, and we will continue to be, so you will see more partnerships coming online. Like others, we're seeing that bundling is really good for the reduction of churn, but also it provides opportunities to basically increase your slate, have marketing optionality across the year. because you have that many more tent poles or programming opportunities to introduce customers to your programming. So we're really excited about that. And then with Peacock, that is a big deal for us. That is pairing a premium with a broad-based streamer, as Jeff mentioned, with 48 million customers. and that I think you'll see that our integration is going to continue to get deeper on the Peacock platform. It is a multi-phase rollout. So you'll see discoverability improve, the buy flow improve. And we do think that's a great model for others. We are built to be bundled. We are built to be a channel. We are highly complimentary to a broad-based streamer. And there are others out there that I think we have that opportunity to do this with.

Okay, thanks for the color. And then separately, I also wanted to follow up on the Michael biofit joining the platform in the next few days. Can you talk about how meaningful that could be for the business and perhaps what you've observed historically on the platform when you add a film of that magnitude in terms of the impact to customer acquisition or engagement or anything else?

Yeah, we manage the business in terms of, you know, we think in terms of tentpoles and we think in terms of supporting content, we fully expect Michael to be a tentpole. for the service. So if you think about what we have going on right now, you know, you've got Kanan having a massive finale this weekend, Fightland off to a great start. We have Michael coming, which we expect to be a tentpole, and generate both subscriber acquisition and high engagement. And if it does anything like what The Housemaid did, that propagated for a very long time and continues to drive for the network. So there's a tail on these movies that are big four quadrant blockbusters that really resonate through the business. So we're excited. We do have expectations against that that we think are reasonable, but we could also see that outperform our expectations.

Okay, great. And then just the last question for me. You mentioned that Raising Kanan grew its audience in Season 5 relative to Season 1. What do you think worked well about that show that enabled that dynamic, and what do you think that suggests about the potential outlook for the upcoming Power spin-offs, given that you have a few others coming up here soon?

I think we've demonstrated over the last 10 years the ability to do spin-off sequels, prequels, I think our average spinoff, sequel, prequel brings anywhere from 75% to 100% of the prior IP audience to the new spinoff. I think it's part of the reason why we launched Fightland on the back of Kanan. And when we look at IP, we're looking to franchise shows. We know that based on the data that seasons two, three, four, and five is where we see massive subscriber growth. And so whenever we're looking at a piece of content It's really to be a recurring series that comes back and everything that we do in terms of how we schedule it, how we launch it, what we launch it behind, how we market, when we drop a trailer. If you look at what we did this past weekend, Fightland had an overlap of two episodes with Kanan. We dropped the teaser trailer for Origins, which is the next spinoff, right around that. You see a lot of social conversation of people going back to the OG power. Thank you for having me. You know, premiering, teasing, dropping, and moving audience across. And you saw that with BMF with the original, the first season of Kanan. You just saw what we did with Fightland. You're going to see with Origins and 18 episodes, it gives us an even more opportunity to layer in other things around that. And so, you know, we are purposely built to get to seasons two, three, four, and five, because that's where you see the streaming business really grow.

Okay, great. Thanks, everyone. Appreciate all the callers.

Thank you. I would now like to turn the call back over to Nilay Shah for closing remarks.

Thank you, Operator, and thank you, everyone. Please refer to the News and Events tab under the Investor Relations section of our website for a discussion of certain non-GAAP forward-looking measures discussed on this call. Thanks.

This concludes today's conference. Thank you for your participation. You may now disconnect.