Good day, and welcome to Lionsgate's second quarter fiscal year 2022 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Nilay Shah. Please go ahead. Good afternoon, everyone. Thank you for joining us for the Lionsgate Fiscal 2022 second quarter conference call. We'll begin with opening remarks from our CEO, Jon Feltheimer, followed by remarks from our CFO, Jimmy Barge. After their remarks, we'll open the call for questions. Also joining us on the call today are Vice Chairman Michael Burns, COO Brian Goldsmith, Chairman of the TV Group Kevin Beggs, and Chairman of the Motion Picture Group Joe Drake. From Starz, we have President and CEO Jeffrey Hirsch, CFO Scott MacDonald, President of Domestic Networks Alison Hoffman, and President of International Networks Superna Kalle. The matters discussed on this call include forward-looking statements, including those regarding the performance of future fiscal years. Such statements are subject to a number of risks and uncertainties. Actual results could differ materially and adversely from those described in the forward-looking statements as a result of various factors. This includes the risk factors set forth in Lionsgate's most recent annual report on Form 10-K, as amended in our most recent quarterly report on Form 10-Q filed with the SEC. The company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect any future events or circumstances. I'll now turn the call over to Jon. Thank you, Nilay, and good afternoon, everyone. Thank you for joining us. Before I talk about another strong quarter, I wanna note the board authorization in regard to Starz. Following my remarks, I'll turn things over to Michael, who will discuss our filing. Now I'll go through a few highlights of the quarter, then drill down in each of our businesses. We return to domestic subscriber growth at Starz, driven by a strong content quarter, and we continue to grow our Starz international subscriber base. Overall, we added 1 million global subscribers in the quarter and remain on track for our long-term subscriber targets. Our Television Group had a very active quarter, launching six new television series, three at Starz and three for other platforms. In addition to rolling out new shows, we're securing valuable renewals of current shows with six Lionsgate Television series recently renewed for new seasons. We started production on nine new films in the quarter as we continue to assemble a strong feature slate for theatrical distribution, ancillary platform monetization, licensing to streamers, and our theatrical output agreement with Starz. Our film and television library continued to perform at record levels with an all-time high of $784 million in trailing twelve-month revenue. We're already seeing contributions from the Spyglass library acquired in the quarter, and we have great early momentum in our partnership with Gary Barber's Spyglass production and distribution company. We continue to advance our all-important diversity, equity, and inclusion initiatives with inclusive hiring policies, a diverse internship program, an inclusive vendor pool, the continued ramp of inclusive new film and TV content, and the expansion of Starz groundbreaking Take the Lead initiative. Beginning at Starz, Power Book III: Raising Kanan and the crime family drama BMF launched in the quarter to the second and third best premiere weeks ever on the Starz platform. We continue to diversify the slate with the successful debut of the critically acclaimed drama Heels, with early renewals for all three series. Looking ahead, we expect returning tentpoles Power Book II: Ghost and Outlander and new series Power Book IV: Force, the Courteney Cox-starring horror comedy Shining Vale, the star-studded Watergate drama Gaslit starring Julia Roberts and Sean Penn, and the period drama The Serpent Queen to continue to drive subscriber growth and retention as we continue to roll out our strongest slate ever. In the quarter, for the first time, domestic revenue from our streaming business exceeded our traditional linear revenue. With the advantage of a strong linear business, we've been able to successfully expand into a premium service complementary to other platforms in both the traditional and streaming worlds, and our value proposition will only continue to grow as this transition continues. Internationally, three years into the rollout of Starzplay, we're in more than 60 countries with 80 distribution partners and 7.5 million subscribers, not counting the nearly 2 million subscribers at Starzplay Arabia. Subscribers grew by over 0.5 million in the quarter, driven by the success of the hit third-party acquisition Dr. Death in Italy, Spain, and Mexico, and the Starz original series Raising Kanan in the U.K., France, and Brazil. After a fast start in India, Lionsgate Play has expanded into four new markets in South and Southeast Asia, where we're poised to roll out our first slate of original programming. We're continuing to strategically invest in more local language originals, striking new partner alliances, and leaning into a wholesale model that we believe offers the best long-term return on our investment and the greatest advantages to current and future partners while strengthening our unique position in the ecosystem as a premium service that can sit on top of any platform. Turning to our Motion Picture Group, the breakout performances of recent theatrical releases and the appetite from streaming platforms makes one thing certain, that overall demand for movie content across multiple platforms is greater than ever. Following an active production year, we're putting the finishing touches on a slate with strength and balance in a number of critical areas, built not only to meet the needs of a rebounding theatrical exhibition business and ever-growing demand for home viewing, as well as driving value in our library and Starz. It's a slate loaded with big, valuable brands led by John Wick: Chapter 4, starring Keanu Reeves, Borderlands, with a world-class cast of Cate Blanchett, Kevin Hart, Jamie Lee Curtis, and Jack Black, The Hunger Games prequel, The Ballad of Songbirds & Snakes, adapted from Suzanne Collins' runaway bestseller, and Expend4bles, with a who's who cast of action stars. Behind those tentpoles, iconic brands Dirty Dancing, Now You See Me, Monopoly, Naruto, The Highlander, and The Night Circus are all in active development, intellectual property which will drive value across our business. It's also a broad and varied slate with inspiring stories like American Underdog, opening on Christmas Day, White Bird: A Wonder Story, starring Helen Mirren and Gillian Anderson in the follow-up to the breakout hit Wonder, and Are You There, God? It's Me, Margaret, adapted from Judy Blume's classic novel, directed by Kelly Fremon Craig, and produced by Academy Award winner James L. Brooks. Big event movies like Roland Emmerich's sci-fi epic Moonfall, starring Halle Berry and Donald Sutherland. Star-driven films including Shotgun Wedding with Jennifer Lopez and The Unbearable Weight of Massive Talent with Nicolas Cage. Finally, as we launch a slate with true global appeal, we're currently out to the international market with our biggest offering in years, over $400 million of movies generating a voracious response from buyers across all distribution platforms. Turning to television, it was a very impressive quarter for our TV group as they leaned into a number of emerging opportunities and strengths. Ramping up content for new AVOD buyers with Zoey's Extraordinary Christmas for Roku and shows in the works for IMDb TV and Tubi. Creating shows for broadcast, where we just secured an order for the back half of the first season of Ghosts, the highest-rated new comedy on CBS, and a second season renewal of Home Economics, the highest-rated new comedy on ABC. Deepening our streaming relationships with the debut of Acapulco and the renewal of seasons 3 and 4 of Mythic Quest on Apple, with 5 series either streaming on or in production for HBO Max. Rolling out a slate of inclusive content with BMF, Blindspotting, Run the World, Ghost, Raising Kanan, Force, and the first offering from the 1619 Project. Of course, continuing to supply Starz with 15 premium scripted series currently airing or in the pipeline. Just this morning, we started production in Hungary on The Continental series for Starz, our exciting expansion of the John Wick universe into television. The origin story of the young Winston features a world-class cast and will roll out in three big 90-minute events on the platform, serving as a reminder of the value of great intellectual property. The Continental becomes part of a slate of nearly 70 Lionsgate television series and 600 hours of programming spanning dozens of platforms. We'll be able to further support this production activity with our new Lionsgate studio in Yonkers, New York. With demand for content greater than ever and prime studio space at a premium, the new state-of-the-art facilities will become an East Coast production hub, increasing our ability to control costs and manage scheduling. Our half-hour scripted series, Run the World for Starz, is slated to be our first production to use the studio early next year. In closing, we've been consistent in creating value across our businesses quarter after quarter. In the past year alone, we've added over 500 titles organically and through acquisitions to one of the largest and freshest film and television libraries in the world. Renewed our greatest number of television series ever in a single year as our Television Group continues to excel in making new shows for the network, streamers, and Starz. Expanded and extended one of the largest portfolios of valuable brands and franchises in the industry with sequels, prequels, spin-offs, branded attractions, interactive games, and digital collectibles. Created tremendous value at Starz by growing subs, adding valuable new shows, building our brand, and scaling our platform around the world. We've accomplished all this ramping our content and marketing spend to over $3 billion this year and scaling our film, television, and Starz businesses into one of the largest independent content platforms in the world, while still generating positive adjusted free cash flow and strong Adjusted OIBDA. Now I'd like to turn the call over to Michael. Thank you, Jon. As you may have seen in an 8-K filing we made this afternoon, Lionsgate's Board of Directors has authorized management to explore potential capital market alternatives for Starz. While we continue to realize substantial synergies from bringing Lionsgate and Starz together, we also see the opportunity to potentially unlock significant shareholder value under a scenario where investors have the ability to value our studio assets and Starz separately. Recent transaction multiples in the media space give us confidence that exploring alternate paths is prudent. Additionally, we believe that a number of the structures we're considering would also allow Lionsgate and Starz to preserve many of the operational benefits we're currently achieving within a single corporate structure. Now, I'll turn things over to Jimmy. Thanks, Michael, and good afternoon, everyone. I'll briefly discuss our second quarter financial results and update you on our balance sheet. Second quarter adjusted OIBDA was $108 million, with total revenue coming in at $888 million, driven by new and returning TV series deliveries and continued demand for library content. Reported fully diluted earnings per share was $0.3 a share, and fully diluted adjusted earnings per share came in at $0.15 a share. Adjusted free cash flow for the quarter was $195 million. Now let me briefly discuss the fiscal second quarter performance of the underlying segments compared to the previous year quarter. Media Networks quarterly revenue was $385 million, and segment profit was $5.5 million. Excluding Pantaya in the last year's second quarter, revenue was up 3%. Segment profit was down year-over-year on higher content and marketing spend associated with the successful premieres of Starz originals. We ended the quarter with 30 million total global subscribers. Total global Media Networks OTT subscribers grew sequentially by 1.3 million - 18 million, which represents a year-over-year subscriber growth rate of 40%. Turning to Motion Pictures, revenue was up 28% to $331 million, while segment profit of $102 million was up 23% and reflects strength from strong home entertainment and library sales. Finally, Television. Revenue was up 70% to $336 million, driven by new series deliveries, including Raising Kanan, Heels, BMF, Hightown, and Acapulco. Segment profit came in at $29 million, up nearly 190%, reflecting the delivery of several series and the licensing of Weeds. Our total library revenue across our Motion Picture and TV businesses hit a new all-time high of $784 million on a trailing twelve-month basis, which reflects a 6% increase over the $737 million of trailing twelve-month library revenue reported in the second quarter last year. On the balance sheet, we ended the quarter with leverage at 4.7 times or 3.4 times, excluding our investment in Starzplay International, reflecting the impact of library strength, tempered by a return to P&A spend and higher content marketing costs. We continue to retain significant liquidity with $443 million of cash on hand and $1.25 billion of an undrawn revolver after reducing our unused commitments by $250 million after quarter end. We remain committed to strengthening our balance sheet and paying down debt while continuing to fund our investment in content and marketing with positive free cash flow as we refresh our library and drive subscriber growth. Now I'd like to turn the call over to Nilay for Q&A. Thanks, Jimmy. Operator, can you open up the call for Q&A? We will now begin the question-and-answer session. To ask a question, press star, then one on a touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then two. At this time, we will pause momentarily to assemble our roster. The first question comes from Alexia Quadrani with J.P. Morgan. Please go ahead. Hi, this is Anna on for Alexia. Thank you so much for the question. First, I was wondering if you can just elaborate a little more on the timing of the spin or split of Starz and when you may move forward with that. Also, why did you come to the decision now? Then my second question is, you know, you talked in the past about your exiting calendar 2023 break even for Starz International. And I was just wondering if that target is still achievable about three years into that. Thank you. I'll take the first question. The timing, it really would depend on exactly what path we choose. So really that's an open question. As we say in the filing, we're starting a process. The answer really as to why is pretty simple that even though we don't normally talk about equity value, it's pretty clear to us that we're not getting the value for the sum of our parts. We in the board feel now is the right time to really shine value on those assets. I think this disclosure emphasizes, you know, we're gonna start that process. Frankly, that we take our obligation to create shareholder value very seriously. The international, Jeff- Yeah, I'll take the second question. Hi, Anna. Great question. You know, as you saw in the quarter, subs continue to be strong, and we still feel really great about our long-term sub guidance. As you saw some of the, you know, industry headwinds, some of our costs are higher, and so the break even is gonna slide out of calendar 2023 into early calendar 2024. Okay. Thank you so much. Operator, could we get the next question, please? The next question comes from Thomas Yeh with Morgan Stanley. Please go ahead. Hi. Thanks for taking my questions. Jon or Michael, a little bit more on the capital markets alternatives you're exploring and where you see the most opportunity there to unlock value. How are you weighing the benefits of maybe greater scale with an outside partner versus retaining the synergies you mentioned as one structure? One for Jeff on the Starz segment profit. Expenses ramped a bit in the quarter with your originals. Can you talk about the balance of brand and performance marketing that you're focused on for subscriber acquisition? And as a marketer on the direct retail OTT side, how do you think about the trajectory and, you know, the leverage on that spending as you grow on the original programming slate? Thanks so much. Yeah, Thomas. I don't think we're gonna put too much meat on the bone in terms of all of the possibilities. I would say we said, and Michael mentioned, that we have been creating some pretty robust synergies between the two sides. Frankly, all of those synergies still are commercial agreements that benefit both sides. We would hope that in many of the structures we're looking at that we can maintain those synergies and benefits. Of course, as well, as you're noting, scale is important as well, and I think that will certainly play a role in our various explorations. On the margins in the quarter, this is the low point of the margins. You know, as we've talked, we're moving from seven to 12 originals, so this is an investment year in originals. We're trying to really line up an original every week, 52 weeks a year for our two core demos that ultimately will bring churn down, extend lifetime value, and accelerate revenue. This is the low margin point of the year. We expect for a full year to be in the mid-20s%. In terms of marketing costs, we did see the, you know, headwinds that the rest of the industry has seen. We saw increased costs due to some of the privacy issues that we got ahead of. We've done some work, technical work with our partners around that, and the worst is behind us now. We think that will normalize as we get through the next couple quarters. We feel really good about the content strategy and how that reflects into subscriber growth, but more importantly, in retention. Thank you. Very helpful. Thanks, Thomas. Operator, could we get the next question, please? The next question comes from Matt Thornton with Truist Securities. Please go ahead. Hey, good afternoon, guys. Maybe two questions if I could. First one maybe either for Jon or maybe Jeffrey. You guys have previously talked about subscriber growth being incremental sub adds being better this year versus last year. Just you know kind of curious if you're still comfortable with that target. Just secondly, coming back to again the exploration of strategic alternatives for Starz. I'm just curious if there's maybe something you guys have been seeing in the market, whether it's you know library transactions or studio transactions or network trading multiples. I'm just kinda curious what has caught your attention and kinda steered you to kinda look in this direction. Any color there would be helpful. Thanks again, guys. Sure. I'll let Jeffrey take the first question on sub growth. Sure. You know, as we've talked repeatedly, we see a real strong year based on moving from our seven to 12 originals this year. As you saw in the first quarter, there were some headwinds. We did have a slower subscriber base in the first quarter. On a domestic basis, we are catching up. On an overall global basis, we will be stronger this year than we were last year. Yeah. Overall, you know, what we're seeing, what's informing how we're looking at our value, frankly, is indeed what you just suggested, which is, if you look on the studio side, on the content side, you're seeing multiples out there that frankly make us believe that the value of the incredible amount of money we've invested, the brands we've invested $16 billion and the incredible pipeline of film and television, when you look at the multiples of some businesses, I won't talk about the specifics, I think you all would know what I'm talking about. I already would say that the value of our studio, in our opinion, is worth more than the entire enterprise value. I'll start with that. I would say the second piece is if you look at all of the streamers, you know, the valuations most are sort of, obviously I'm taking Netflix out of the equation, but most are investing or if you would, losing money, and yet they're, you know, certainly getting huge multiples in their stock. It looks to us like they're getting multiples of somewhat like 4x revenue, something like that. When we look at what we believe is happening with our equity value, honestly, we feel like the international, where we're building revenues, building subs, and in 58-60 countries right now, we believe we're getting a negative value on our investment in that business. If you just would zero that out and just say it's even with, you know, Starzplay Arabia, which we think is quite valuable, but if you said that's worth zero, you know, that in our opinion adds $1 billion of value right away. Yeah, we are looking at the multiples and the way other businesses are being valued. We just think we're way off, way undervalued. Thanks, Matt. Operator, could we get the next question, please? The next question comes from Rich Greenfield with LightShed Partners. Please go ahead. Hi. Thanks for taking the question. You know, when you think about sort of Disney, Fox, and Warner Bros. Discovery, ViacomCBS, and I guess even Amazon MGM, it sort of feels obvious that, you know, I guess quote-unquote winning in the future of media is gonna take sort of major sort of massive streaming subscriber scale and sort of a depth and breadth of content like we've never seen before. You know, I know that you're sort of exploring strategic alternatives. I read the filing for Starz, but, you know, obviously that creates many different, you know, things that could happen in terms of M&A. I guess, how do you think about what Starz brings to potential merger partners in terms of its unique demographic appeal of its content, its global reach and strategic partnerships that you've been doing over the last few years? Hey, Rich, it's Jeff. That's a great question. Thanks for asking it. Look, as you said, you know, we have really built a very unique content pipeline. We really focus on two core demos, and we're the, you know, the global leader, I think, in female audience demographic and African American audience demographic, which makes us really unique for any of our partners. We've built this business into 62 countries around the world with over 80 partners all over the world. As we've always said, we're a very complementary service to all these broad-based streaming services. As that kind of broad-based streaming competition heats up with all of these mergers, you know, you can compete on price, you can compete on dollars, but you can compete on value. By adding Starz into your portfolio with our unique content strategy, it really will help differentiate somebody that they can't replicate with our services. Michael, maybe just to follow up. Once you sort of set in motion sort of these, you know, capital market alternatives, I assume it's fair to say that anything is on the table transaction-wise once you begin this process with the board. Well, the board authorized us to explore these, so, obviously, we're gonna explore them. We mentioned some specific potential structures in there, and we're not gonna go, Rich, right now into more detail than that we had in our filing. I think, Rich, the answer is that we're doing this because we believe we're seriously undervalued. We are looking for, with this filing, with our Canadian domiciles an optionality, and we're gonna do all the work on it. Again, very focused on that shareholder value. Yeah. If Moonbug is worth $3 billion, it seems to create a lot of opportunities. Appreciate you saying that. Thank you. Thanks, Rich. Operator, could we get the next question, please? The next question comes from Jim Goss with Barrington Research. Please go ahead. Thanks. I guess this is Michael also. Are you thinking that the market has changed more than Starz has over this several-year period where you've been together? Because it seemed at the time of that merger that Starz had a very nice but very steady stream of OIBDAs that was not varying a lot and therefore was not gonna be valued as highly as some of the more growth-oriented ones. Do you think you've done anything to change that mix that would make it more attractive? Or is it just that having that sort of property would be more appealing to one of the potential buyers at this stage? I think that Jeff and his team have done a fantastic job in their demo, as Jeff talked about earlier. The world has certainly changed because you've got an enormous competition and a lot of streamers, you know, around the globe. But we, as Jeff mentioned before, we think we're very well-positioned in that world. Again, 60+ countries internationally. Domestic subs are in a really good place as we migrate more to the digital over-the-top space. Yeah. Let me add to that. When we did the deal, we had somewhere less than 400,000 or 500,000 over-the-top streamers. We were primarily a linear, domestic linear cable network. Today, we have over 53% of our domestic revenue comes from over the top. We have more global over-the-top streaming services than we have linear services. We're in 62 countries around the world. We were just domestic. We've really changed and pivoted this business from being a single revenue stream linear business to a global streaming service that's really driven off of data. I think the company is way more valuable than it was back in when the acquisition was done in 2017. Okay. Maybe one other on the content creation side. Jon, you outlined a lot of compelling factors about your film business. I'm wondering if you could talk about you or anyone could talk about the theatrical release versus the streaming series versus TV options in terms of where you think the sweet spot is in terms of economics and appeal in your content creation. I'll have Joe answer that question. Yeah. Thanks, Jim. Look, we're in a really interesting market right now. There's certainly some complexities to it. It has some challenges. We're finding, frankly, more opportunity than we're finding challenges. When you look at, you know, Jon talked a lot about the lineup. We early on in the pandemic leaned heavily into production because we saw an opportunity, and we now have, you know, one of our most robust slates that's targeted to all the various opportunities. So when you think about and you look at the data on who's coming back to the theater, you know, it's heavily male. It's a diverse audience, Gen Z and millennials, and we've got a number of big brands like John Wick. You can think of American Underdog at Christmas, Borderlands that are right in that sweet spot. We also release over 60 films a year across our whole business, and that platform-agnostic business, because of all the appetite in-home, is starting to really grow. We've also been working very closely with Starz, which has a real impact on what we're green-lighting so that we can really serve that customer with precision. It's a really interesting time for us, and I think we're set up really nicely. Okay. One last thing. Were you also basically implying that if Starz is able to be sold or partnered with someone else, these sort of options would also apply to the remaining film business? Well, I mean, I think. Yeah, look, the simple answer is that there's a lot of ways this could go, but the pay one deal that we have exists. We just made it so the slate of Lionsgate films would be securely in the Starz purview for a number of years. Again, it would be our intention, of course, to continue to grow synergies that are both, you know, that are beneficial for both sides. All right. Thank you very much. You're welcome. Thank you, Jim. Operator, could we get the next question, please? The next question comes from Alan Gould with Loop Capital. Please go ahead. Hi, guys. Thanks for taking my question. I've got two questions. First, I'm not gonna ask the various ways of going this option, but Jimmy, you've been highlighting the trailing twelve-month library number for a number of quarters now, maybe a couple of years now. It's up to $784 million. Can you refresh our memory as to what kind of either EBITDA margin or free cash flow margin you typically have on the library? The second question is for Jeff. Jeff, you seem to be in your sweet spot of your one franchise show rolling into the next franchise show. Can you tell us what the trend in churn has been? Not what the churn is, but is churn coming down a little bit, given this, you know, going to the 12 shows and having one coming to the next one? Thanks, Alan. I appreciate it. No, great question, particularly in the context of some of the parts and significantly undervalued assets. You know, we're approaching $800 billion in revenues in trailing twelve months and, you know, organic growth, and we expect to see continuing value build there. The cash margins are 50% plus. So you know, you pretty well do the math pretty quick and put whatever multiple you want on that and come up with a $4 billion-$6 billion+ value. You know, again, tremendous asset. Yeah. In terms of churn, you know, like you said, we continue to line up our programming, you know, with the, with finales and premieres on the same weekend to roll audiences from one show to the next. In the quarter, we continued to see, you know, historic low levels of churn on the business. We're really encouraged on the thesis, and we really think long term, we can achieve that low single-digit churn number. Thank you. Thanks, Alan. Operator, could we get the next question, please? The next question comes from Matthew Harrigan with Benchmark. Please go ahead. Thank you. My flow of Starz questions has pretty much been exhausted. I had a couple other things. One, you've got tremendous momentum on the TV production side, not just for Starz, but for third parties. One thing that's interesting, and I think this is a telling number, there's one data company in the U.K. that had access to, I think, you know, the actual consumption data for 1,500 Netflix customers in September, again, in the U.K. Four of the top shows were actually off network U.S. shows. I think they were all comedies, but clearly, you know, dramas have a lot of interest over there as well. You know, some of the value is just the sheer amount of volume and repetitivity in terms of people watching the shows. How difficult is it gonna be in this world to really get to a credible number of episodes for something like Ghosts, assuming that it continues to get traction and really get this breakout long-term value? Secondly, I know Jon's been on the board of Televisa since, I think, 2015 or 2016. You know, what are the possibilities of the TelevisaUnivision joint venture and all the production they're going to need, you know, there, given your relationships with Televisa over the years and Univision? Thank you. I'll start with the question about getting to enough episodes to syndicate, if you will, for a continuing back end. We you know, the broadcast model is one that we've been out of for a lot of years. With some new templates and models and just fantastic content, we've really broken back into it. Ghosts is a great example. It's a huge success. It's the number one comedy of the fall across all broadcast networks. They ordered it back episodes to give it a full season order. We hope like you would with any comedy, that you successively get new season renewals, and that moves very quickly to get to scale. Ditto with Home Economics. It was a mid-season show for ABC. It premiered again this fall, renewed for the full 2022. Those move fast. The Netflix or premium shows often are in the eight to 10 episode order range for the first season. Like many shows when they're working, I find that the platforms want as many as they can get as quickly as they can get because they're driving audience. Every time we turn around, there's an emerging player that's jumping into the fray. We're excited to have Zoey's Extraordinary Christmas on Roku. That's an AVOD player moving into the original space. One of the great things about our partnership with Starz is really Jeff's mindset and thinking about series is longevity. That's quite different than a lot of the other streaming players who are interested in two or three seasons and out. In the Power verse, obviously Ghost was a long-running hit, or Power, and then Ghost is right behind it. Kanan is off to a great start, and we're excited about Force, and we think if they continue to hit their numbers, they'll be on for years to come. It's all about making great shows at a price and delivering value to the customer and the platform. Yeah. I think it's sort of interesting the way you posed that question, Matt, because the fact of the matter is that given that the streamers are all making real value out of these longer running series, as you say, and essentially they're serving the purpose of retrans the way the old syndication business was. I think everyone in the marketplace is really encouraged to have you know a real portfolio of each of those brands in the future. We don't really see that you know going the other way. In terms of what you're alluding to, I mean, again, I'm on the board. I can't say much, but I think it's clear Televisa's got real ambition to be a big broad streamer. They are, you know, the biggest player in the Spanish language market. What's fascinating about the world right now, I just finished watching a whole bunch of episodes of a series called Velvet, which is a Spanish series. I think what's happening right now is people are enjoying watching in language, if you will, series that are actually subtitled. I think there's gonna be some really interesting opportunities. We're doing about four or five Spanish language co-productions right now out of Spain. We're doing four originals right now in India. We think that given that we're doing all high value programming, we think there is gonna be a lot of opportunity to use programming and create programming library value, you know, all over the world right now, and that's why we're reaching our tentacles and our production expertise into a lot of different places. We are one of the only independents that I think is gonna be able to supply every single vertically integrated streamer and all of the new players, the AVOD players, everyone in the market. We think the buying and the amount of buyers that we're gonna have to serve and who will rely on us because they know we deliver, I think is bigger and bigger, and our ability to create content is greater than ever. Thanks. Congratulations on your initiative today. Thanks, Matt. Operator, could we get the next question, please? The next question comes from Doug Creutz with Cowen. Please go ahead. Yeah, thanks. You kind of alluded to the IDFA changes as being a headwind, and obviously it's impacted user acquisition for a lot of people. Can you kinda talk about how your effective user acquisition costs are trending, whether you're spending more or less, and how you've changed your allocation of budget across different channels? Thanks. Yeah, thanks for the question. You know, the nice thing about what we've been able to build, because we got out so early building our own direct-to-consumer app, is that we really had great robust data on the back end. We're able to bring digital buying in-house, and so we really control the bottom of the funnel. We knew from our partners that this change was coming. We were working ahead of it to try to, you know, work around it and work with our partners to come up with some technical workarounds. We did see an impact in the quarter in terms of our costs. We have seen costs come down in the tail end of the quarter. We do think working with our partners, we'll be able to normalize that and the worst is behind us. I think we get back to our normal cost in the next couple quarters. Great. Thanks. Yeah. Thanks, Doug. Operator, could we get the next question, please? The next question comes from Steven Cahall with Wells Fargo. Please go ahead. Thanks. Interesting on the potential transaction you announced, and I certainly agree on your sum of the parts argument, especially in this gold rush for content with what you've got at the studios and the library. I think one question folks are gonna debate is, you know, in a transaction if you can get a similar value for Starz versus, I think, the $4.4 billion that you paid in 2016. I was wondering if you could comment. You know, I'm sure you've talked to advisors and potential approaches here, if you think you'll be able to realize a similar or higher value for Starz than what you paid for it. Then Jon, a question just on how you're thinking about theatrical. It seems like a lot of the success that's coming back in theatrical is with a lot of really big budget films, big experiential, you know, sort of periods. How do you think about how Lionsgate fits into maybe a more premium format theatrical experience? We've seen some smaller studios like A24 sorta go to a smaller budget but straight to streaming strategy, and I think that's a much more profitable sort of approach for you as well. I'm just curious how you're thinking about theatrical versus in-home. Thanks. Thanks for the question. Look, I think Jeff laid out pretty clearly all the value that he and his team have created with transforming Starz into a really modern global streamer. I think I'd be a very foolish CEO if I were to tell you what I think the value is. I'm also you know, we're you're anticipating a transaction, a potential transaction that may or may not be the form that this takes. All I can say is we believe we've created great value at Starz. We believe we're not having that recognized in our equity value, and we are embarking on a path to make sure that we get that value. Yeah. Steve, on the On the theatrical question, we're spending a lot of time looking at that, theatrical audience. I think that there's some trends you can see. Certainly big event branded titles, action titles, big event spectacle works. You know, we've leaned heavily into our development slate in that area and have a couple films in post and a number of films going into production that we think will fit that demand really, really well. We're a company that releases all kinds of films, and so we have this other business doing, you know, 50-60 films a year in various distribution scenarios that don't require theatrical. Yet there's a mid space in the business that I call, like, mid-budget original content that we've really occupied and done well in historically. We still think that there's a space there for us. They're really target audience films. Because that theatrical release still drives so much downstream value, and because the values downstream, whether that's our international sales business, the value in television, the value in home entertainment is increasing, we still feel very confident and have proven on a number of releases recently that we can be profitable and hit really nice margins without having necessarily to achieve the same level of box office. Thanks, Steve. Operator, could we get the next question, please? We currently have nobody in our question queue, so I will remind our listeners, if you would like to ask a question, press star then one to join the queue. Again, that is star then one to join the queue. Thanks, operator. Thanks, everyone. Please refer to the press releases and events tab under the investor relations section of the company's website for a discussion of certain non-GAAP forward-looking measures discussed on this call. Thank you and have a good evening. The conference is now concluded. 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