Activist investor Anson Funds is pressing Lionsgate to redefine itself for the AI era or put itself up for sale, according to a July letter to the board reviewed by Semafor. The argument turns on how the market reads a film library.

“The rise of generative AI has led the market to sort companies bluntly into ‘AI winners’ and ‘AI losers’,” wrote Anson’s Sagar Gupta. Lionsgate stock, he argued, has reacted sharply and negatively to new AI video model releases.

The specific tell

Gupta named Sora and Seedance as the releases that moved the stock. That is a precise claim about how equity markets now price content ownership.

Both models have advanced quickly. ByteDance’s Seedance 2.5 generates 30-second native 4K video and accepts up to 50 reference inputs, a capability that did not exist in usable form eighteen months ago.

The market’s default assumption, in Gupta’s reading, is that a studio is more likely to be an AI casualty than an AI beneficiary.

The counter-argument

Anson does not accept that reading. It believes Lionsgate could command a premium precisely because it owns roughly 20,000 titles, with licensing revenue available from that library.

The company has simply failed to explain this to investors. That is a marketing problem rather than a business-model problem, at least in Anson’s telling.

The thesis has a live proof point. Disney licensed more than 200 characters to OpenAI’s Sora alongside a $1 billion investment, establishing that studio IP has a price in generative video rather than merely a vulnerability.

Why buyers might come

Gupta pointed the board at recent precedent. Amazon bought MGM, Microsoft bought Activision Blizzard, and Netflix fought Ellison-backed Paramount Skydance for Warner Bros Discovery.

His conclusion is that technology and streaming players have already shown they will acquire premium IP outright rather than license it. If that holds, a 20,000-title catalogue is an acquisition target rather than a depreciating asset.

Lionsgate owns Rambo, The Hunger Games, and John Wick, which is the kind of franchise inventory streaming services are short of.

What the company says

Lionsgate declined to comment to Semafor and told investors on its earnings call last week that it has not engaged in any substantive conversations with potential acquirers.

It has taken informal advice from at least two investment banks without hiring either to run a formal strategic review. Netflix, one obvious suitor, has publicly denied pursuing the studio.

Shares are up 36% this year but down 7% over the past month, which is roughly the shape of a market that has not made up its mind.

The bigger uncertainty

Whether AI video displaces studio output or feeds off it remains genuinely unsettled. Text-to-video systems have already produced award-winning short work, and the trajectory towards longer forms is not in doubt.

The tools are also being absorbed into existing production rather than replacing it. Startups like Flawless are editing Hollywood films line by line, which is augmentation rather than substitution.

Consumer appetite is not settled either. OpenAI shut down Sora as a consumer product after objections including from the families of Martin Luther King Jr and Robin Williams, a reminder that generated content carries reputational costs licensed content does not.

What is actually being tested

The market is sorting companies into AI winners and losers on assumptions that have not been validated by revenue, and studios have landed on the wrong side of that sort by default.

Anson’s bet is that the sorting is wrong and a buyer will notice before the market does. The alternative reading is that the market is early rather than mistaken, which is a considerably worse position for anyone holding the stock.

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