What happened

Shares of Lions Gate Entertainment (NYSE:LGF-A) (NYSE:LGF-B) soared in Friday's trading session following the TV and cinema content-studio's release of results for the fourth quarter of fiscal year 2017. Non-voting Class B shares of Lions Gate rose as much as 9.8% at 3:00 p.m. EDT. The vote-endowed Class A shares reached a 9.1% gain at the same time.

So what

Wall Street analysts had expected Lions Gate's fourth-quarter sales to land near $1.19 billion, yielding earnings of roughly $0.21 per share. Instead, the company reported GAAP earnings of $0.28 per diluted share and adjusted earnings of $0.54 per diluted share. Revenues surged 59% higher year over year thanks to the acquisition of premium cable network Starz, which closed near the end of the third quarter. Comparing apples to non-GAAP apples, Lions Gate's sales rose 2% over the combined revenues of Starz and Lions Gate in the year-ago period.

Excited crowd in a dark movie theater.

Image source: Getty Images.

Now what

Judging by the first full quarter of Lions Gate's post-merger operations, the marriage is off to a good start. Starz continues to grow its premium channel subscriber counts, despite the merger activity and the general trend toward cord-cutting in American households. Lions Gate delivered several solid hit movies near the end of 2017, including award-winning La La Land, starring Ryan Gosling, and Keanu Reeves' thriller John Wick: Chapter Two.

Looking ahead, Lions Gate's movie slate in the second half of this calendar year pulls in star power from Julia Roberts, Ryan Reynolds, Samuel L. Jackson, and Owen Wilson. There's another title coming up in the Saw horror series, a big-screen My Little Pony adventure, and another crowd-pleaser from Tyler Perry's hit-making workshop.

In other words, it's steady as she goes, with the bonus of having Starz's media distribution savvy in-house alongside Lions Gate's proven production skills.

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