Premium channel Starz added about 200,000 new subscribers to its premium service in the second quarter, fueled in part by its new Starz app released in the spring.
Starz unveiled it new app in April, allowing consumers to purchase the premium service as a standalone offering while allowing existing MVPD subscribers to access new features such as the ability to download shows to watch later, through the authenticated service.
Starz ended the second quarter with 24.2 million subscribers, a new record. On a conference call late Thursday with analysts CEO Chris Albrecht said that Starz recently revamped app has been a factor in the increases, but that it is still early in the game.
“This is the first inning of this,” Albrecht said on the call. “It's not even the first, it's half of the first inning on this stuff and we're learning a lot. We're going to be leaning into it more. We've been pragmatic and we've been disciplined, but the results that we've seen so far show us that we're certainly making the right decisions around these opportunities.”
Starz also got a boost from Comcast’s spring Watchathon – the premium channel said it had three of the top 10 most-watched original series during that event – Outlander, Black Sails and The Girlfriend Experience.
Consolidated revenue declined 4% in the period to $402.6 million, while operating income dipped 5% to $105.4 million and adjusted OIBDA increased 3% to $127.4 million. At Starz Networks, which includes its Starz and Encore channels, the quarter was a little better, with revenue up 3% to $343.1 million, operating income up 9% to $121.1 million and adjusted OIBDA rising 8% to $132.1 million.
Starz agreed in June to be acquired by Lionsgate in a deal valued at about $4.4 billion. That transaction is expected to close by the end of the year.
On the conference call, Albrecht said outside of the obvious advantages of the Lionsgate deal – a bigger content library and an attractive take-out price –there are other benefits to the deal.
“First of all, we're going to be a magnet for talent,” Albrecht said, adding that with a stronger financial partner Starz will be able to more effectively attract and monetize content and build better digital businesses.
“It's going to allow us to better manage things in a more effective way and I think that's important,” Albrecht said.