XML 61 R20.htm IDEA: XBRL DOCUMENT
v3.25.2

Income Taxes | 12 Months Ended
--- | ---
Mar. 31, 2025
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The components of pretax (loss) from continuing operations, net of intercompany eliminations, are as follows:
| Year Ended March 31,
| 2025 |  | 2024 |  | 2023
| (Amounts in millions)
United States | $ | (210.4) |  |  | $ | (925.9) |  |  | $ | (1,344.8) |
International | (13.5) |  |  | (7.6) |  |  | (9.4) |
| $ | (223.9) |  |  | $ | (933.5) |  |  | $ | (1,354.2) |
The Company’s current and deferred income tax provision (benefits) are as follows:
| Year Ended March 31,
| 2025 |  | 2024 |  | 2023
Current provision (benefit): | (Amounts in millions)
Federal | $ | 0.8 |  |  | $ | (69.6) |  |  | $ | 5.8 |
States | (7.0) |  |  | 0.1 |  |  | 0.4 |
International | 0.1 |  |  | 1.1 |  |  | 0.6 |
Total current provision (benefit) | $ | (6.1) |  |  | $ | (68.4) |  |  | $ | 6.8 |
Deferred provision (benefit): |  |  |  |  |
Federal | $ | (4.0) |  |  | $ | (45.4) |  |  | $ | (22.5) |
States | 1.5 |  |  | (15.1) |  |  | (2.6) |
International | — |  |  | — |  |  | — |
Total deferred provision (benefit) | (2.5) |  |  | (60.5) |  |  | (25.1) |
Total (benefit) provision for income taxes | $ | (8.6) |  |  | $ | (128.9) |  |  | $ | (18.3) |
In addition, included in net earnings (loss) from discontinued operations was an income tax provision of $0.1 million in fiscal year ended March 31, 2025 (2024 — income tax benefit of $24.2 million, 2023 — income tax benefit of $100.3 million). The Company's income tax provision differs from the U.S. federal statutory rate multiplied by pre-tax income (loss) due to the tax effects of goodwill and intangible asset impairments, state income taxes, and changes in the valuation allowance against its deferred tax assets. The Company's income tax provision for the fiscal years ended March 31, 2025, 2024 and 2023 was also impacted by charges for interest, and the change in uncertain tax benefits due to the expiration of statutes of limitations and additional settlements with tax authorities. The differences between income taxes expected at U.S. statutory income tax rates and the income tax provision (benefit) are as set forth below:
| Year Ended March 31,
| 2025 |  | 2023 |  | 2022
| (Amounts in millions)
Income taxes computed at U.S. federal statutory rate | $ | (47.0) |  |  | $ | (196.0) |  |  | $ | (284.4) |
Foreign operations subject to different income tax rates | (0.6) |  |  | 1.1 |  |  | 0.3 |
State income tax | 1.7 |  |  | (15.0) |  |  | (2.2) |
Remeasurements of originating deferred tax assets and liabilities | 7.0 |  |  | 47.6 |  |  | (0.4) |
Permanent differences | 8.1 |  |  | 0.1 |  |  | (0.3) |
Excess tax benefit on share-based compensation | — |  |  | — |  |  | — |
Income tax effects of goodwill and intangible asset impairments | — |  |  | 64.5 |  |  | 196.5 |
Uncertain tax benefits | (7.3) |  |  | (70.3) |  |  | 5.0 |
Other | — |  |  | — |  |  | 0.8 |
Changes in valuation allowance | 29.5 |  |  | 39.1 |  |  | 66.4 |
Total provision (benefit) for income taxes | $ | (8.6) |  |  | $ | (128.9) |  |  | $ | (18.3) |
The income tax effects of temporary differences between the book value and tax basis of assets and liabilities are as follows:
| March 31, 2025 |  | March 31, 2024
| (Amounts in millions)
Deferred tax assets |  |  |
Net operating losses | $ | 222.9 |  |  | $ | 207.6 |
Foreign tax credits | 9.1 |  |  | 8.3 |
Programming content | 65.5 |  |  | 92.8 |
Accrued compensation | 11.3 |  |  | 11.7 |
Operating leases - liabilities | 13.5 |  |  | 15.5 |
Other assets | 12.3 |  |  | 7.7 |
Fixed assets | 4.1 |  |  | 4.5 |
Reserves | 1.6 |  |  | 1.8 |
Interest | 35.4 |  |  | 23.4 |
Total deferred tax assets | 375.7 |  |  | 373.3 |
Valuation allowance | (177.5) |  |  | (141.3) |
Deferred tax assets, net of valuation allowance | 198.2 |  |  | 232.0 |
Deferred tax liabilities |  |  |
Intangible assets | (195.0) |  |  | (229.2) |
Operating leases - assets | (9.1) |  |  | (10.7) |
Other | (2.6) |  |  | (3.1) |
Total deferred tax liabilities | $ | (206.7) |  |  | $ | (243.0) |
Net deferred tax liabilities | $ | (8.5) |  |  | $ | (11.0) |
The Company has recorded valuation allowances for certain deferred tax assets, which are primarily related to U.S. and foreign net operating loss carryforwards (“NOLs”) and U.S. federal foreign tax credit carryforwards as sufficient uncertainty exists regarding the future realization of these assets. The table below present the changes in the deferred tax valuation allowances:
| Year Ended
| March 31,
| 2025 |  | 2024 |  | 2023
| (Amounts in millions)
Beginning balance | $ | 141.3 |  |  | $ | 92.2 |  |  | $ | 25.4 |
Changes in valuation allowance | 37.2 |  |  | 41.3 |  |  | 66.8 |
Other(1) | (1.0) |  |  | 7.8 |  |  | — |
Ending balance | $ | 177.5 |  |  | $ | 141.3 |  |  | $ | 92.2 |
_______________________ (1) Amounts in "Other" primarily reflect adjustments related to discontinued operations for the fiscal years ended March 31, 2025 and 2024. No discontinued operations activity impacting items with a valuation allowance was recorded for the fiscal year ended March 31, 2023. As computed on a separate return basis, with the combined historical results of the Company presented on a managed basis as discussed in Note 1, at March 31, 2025, the Company had U.S. federal NOLs of approximately $389.5 million, of which approximately $157.8 million would be subject to expiration in 2038, and the remainder would carry forward indefinitely. Additionally, at March 31, 2025, the Company had state NOLs of approximately $331.5 million, which would expire in varying amounts beginning in 2027, and foreign NOLs in various jurisdictions, including Canada, India, and Luxembourg of $55.2 million, $33.7 million, and $404.1 million, respectively, which would expire in varying amounts beginning in 2030. The Company also had U.S. federal credit carryforwards related to foreign taxes paid of $9.1 million that would expire beginning in 2027. However, under the managed basis of presentation of the Company, the combined historical results exclude certain income, deductions and other items and therefore, for purposes of these combined fina ncial statements, these items are not reflected in the calculations of net operating loss and tax credit carryforwards of the Company. As a result, the actual net operating loss and tax credit carryforwards of the Company after the Separation may differ (i.e., be lower in U.S. and Canada, and higher in Luxembourg) than those otherwise stated above. The following table summarizes the changes to the gross unrecognized tax benefits, exclusive of interest and penalties, for the years ended March 31, 2025, 2024 and 2023:
| Amounts in millions
Gross unrecognized tax benefits at March 31, 2022 | $ | 69.1 |
Increases in tax positions for current year | — |
Increases in tax positions for prior years | 0.2 |
Decreases in tax positions for prior years | — |
Settlements | (4.3) |
Lapse in statute of limitations | (0.4) |
Gross unrecognized tax benefits at March 31, 2023 | $ | 64.6 |
Increases in tax positions for current year | — |
Increases in tax positions for prior years | — |
Decreases in tax positions for prior years | — |
Settlements | (60.7) |
Lapse in statute of limitations | (0.8) |
Gross unrecognized tax benefits at March 31, 2024 | $ | 3.1 |
Increases in tax positions for current year | — |
Increases in tax positions for prior years | — |
Decreases in tax positions for prior years | — |
Settlements | (3.1) |
Lapse in statute of limitations | — |
Gross unrecognized tax benefits at March 31, 2025 | $ | — |
The Company records interest and penalties on unrecognized tax benefits as part of its income tax provision (benefit). For the fiscal years ended March 31, 2025, 2024 and 2023, the Company recognized as a charge or (benefit) to the tax provision (benefit) net interest and penalties related to uncertain tax positions of $(7.3) million, $(9.1) million and $5.3 million, respectively. The liability for accrued interest amounted to nil and $4.2 million as of March 31, 2025 and 2024, respectively. The total amount of unrecognized tax benefits as of March 31, 2025 that, if recognized, would benefit the Company's tax provision are nil. The Company is subject to taxation in the U.S. and various state, local, and foreign jurisdictions. To the extent allowed by law, the taxing authorities may have the right to examine prior periods where NOLs were generated and carried forward and make adjustments up to the amount of the NOLs. Currently, audits are occurring in various state and local tax jurisdictions for tax years ended in 2015 through 2020. Additionally, positions taken by Old Lionsgate in certain amended filings are subject to current review. Old Lionsgate is currently under examination by the Canadian tax authority for the years ended March 31, 2018 through March 31, 2021.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income tax. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 231 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482663/740-10-55-231 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12C -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12C Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12B -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477891/740-270-50-1 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB Topic 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-13 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/740/tableOfContent Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-14 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-21 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-17 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration