Lionsgate's disappointing quarterly earnings should further fan the ire of its resident disgruntled shareholder Carl Icahn.
Despite a series of recent box office and home video hits, Lionsgate reported second quarter losses of $29.7 million, or 22 cents a share, which the studio attributed to rising movie marketing costs.
Shares of the Vancouver-based studio rose slightly on the news.
The loss compares with a profit of $31.7 million, or 26 cents, from the same period a year earlier.
The studio reported revenue of $456.3 million for the period ending September 30, 2010. That represented a 25 percent increase in revenue compared to the same quarter last year, thanks to the strong theatrical performance of "The Last Exorcism" and "The Expendables."
That beat Wall Street's expectations. Analysts had predicted revenue of $418.85 million for the quarter.
Yet the decision to release four films over the period, as opposed to the two it rolled out over the same time span in 2009, contributed to escalating distribution and promotional costs for the studio.
Not that an unusualy full slate was the only ball Lionsgate had to juggle. It also was fielding off Icahn's ongoing takeover attempt and ceaseless stream of proxy offers. The studio is currently engaged in legal disputes with the billionaire investor in New York and Canada.
The cratering DVD market impacted the studio's bottom line. Despite the strong performance of "Kick Ass" and "Why Did I Get Married Too?," Lionsgate’s home entertainment revenue from both motion pictures and television was $132.1 million in the second quarter. That represents a 5 percent decline from the second quarter of 2009.