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Income Taxes
 6 Months Ended
Sep. 30, 2025
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The income tax provision for the six months ended September 30, 2025 was calculated by estimating the Company’s annual effective tax rate (estimated annual tax provision divided by estimated annual income before income taxes), and then applying the effective tax rate to income (loss) before income taxes for the period, plus or minus the tax effects of items that relate discretely to the period, if any. The Starz Business’s U.S. operations and certain of its non-U.S. operations historically have been included in the income tax returns of Lionsgate or its subsidiaries that may not be part of the Starz Business. For the six months ended September 30, 2024, income taxes were calculated as if the Starz Business files income tax returns on a standalone basis, including assumptions regarding the allocation of consolidated tax attributes.
The Company’s income tax provision differs from the federal statutory income tax rate applied to income (loss) before taxes due to the mix of earnings generated across the various jurisdictions in which operations are conducted. The Company’s income tax provision for the six months ended September 30, 2025 and 2024 were impacted by changes in the valuation allowances against certain U.S. and foreign deferred tax assets, net of applicable deferred tax liabilities.
The Company’s income tax provision can be affected by many factors, including the overall level of pre-tax income, the mix of pre-tax income generated across the various jurisdictions in which the Company operates, changes in tax laws and regulations in those jurisdictions, changes in uncertain tax positions, changes in valuation allowances on its deferred tax assets, tax planning strategies available to the Company, and other discrete items.
On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act (“OBBBA”). The OBBBA makes permanent key elements of the 2017 Tax Cuts and Jobs Act, including 100% bonus depreciation, current expensing of domestic research and development (“R&D”) costs, and the use of EBITDA as the measure in computing the limitation on business interest expense deductions. In accordance with Accounting Standards Codification Topic 740, Income Taxes, the effects of new tax legislation are reflected in the period of enactment. Accordingly, during the quarter ended September 30, 2025, the Company recognized the impact of these provisions, including electing to expense all current and previously capitalized R&D costs and applying 100% bonus depreciation on eligible fixed asset additions. The Company also adopted the new EBITDA-based limitation in calculating the deductibility of business interest expense, which represents the most material impact of the OBBBA to the Company. The enactment did not change the statutory U.S. federal corporate tax rate. The Company continues to evaluate the implications of the OBBBA and other tax law changes on its current and deferred tax positions.
There were no other material discrete income tax items or significant changes in uncertain tax positions during the six months ended September 30, 2025.