What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-08-04 compared with 2026-04-30 · 240 added, 118 removed, 698 unchanged (34% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

March 31, 2026

June 30, 2026

December 31, 2025

29 unchanged sentences

Operating lease liabilities, net of current portion

Other long-term liabilities

Total liabilities

2 unchanged sentences

Common stock, $ 0.0001 par value, 700,000,000 shares authorized;

169,850,328 and 169,095,572 shares issued and outstanding as of March 31, 2026, and December 31, 2025, respectively

186,504,214 and 169,095,572 shares issued and outstanding as of June 30, 2026, and December 31, 2025, respectively

Additional paid-in capital

10 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

Three Months Ended March 31,

Licensed content and other revenue

Pay it Forward revenue

Total revenue

Three Months Ended June 30,

Six Months Ended June 30,

Operating expenses:

8 unchanged sentences

( 21,324,297 )

( 21,177,555 )

( 54,915,860 )

Other income (expense):

Net loss on digital assets

Net gain (loss) on digital assets

( 2,935,243 )

3 unchanged sentences

( 2,742,902 )

( 9,127,015 )

( 4,307,057 )

Interest income

Total other expense

Other income (expense)

Total other income (expense), net

( 5,282,642 )

3 unchanged sentences

( 15,706,671 )

( 37,550,082 )

( 53,036,803 )

Income tax benefit

1 unchanged sentence

( 15,706,671 )

( 37,550,082 )

( 53,036,803 )

Net income (loss) attributable to noncontrolling interests

2 unchanged sentences

( 15,769,536 )

( 37,597,602 )

( 53,073,460 )

Net loss per common share - basic

7 unchanged sentences

Noncontrolling

Balance as of March 31, 2026

( 255,335,588 )

( 41,459,771 )

Stock options exercised

Vesting of restricted stock units

Issuance of common stock, net of fees

Transfer of common stock

Repurchase of common stock

Stock-based compensation expense

Redemptions from noncontrolling interests

( 23,793,082 )

( 23,794,026 )

Balance as of June 30, 2026

( 279,128,670 )

( 29,329,412 )

Balance as of March 31, 2025

( 108,356,350 )

Stock options exercised

Issuance of common stock, net of fees

Transfer of common stock

Repurchase of common stock

Stock-based compensation expense

Convertible note beneficial conversion feature

Issuance of warrants

Contributions from noncontrolling interests, net of fees

Redemptions from noncontrolling interests

( 5,750,000 )

Net income (loss)

( 15,769,536 )

( 15,706,671 )

Balance as of June 30, 2025

( 124,125,886 )

See accompanying notes to the condensed consolidated financial statements

ANGEL STUDIOS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

Six Months Ended

Noncontrolling

Balance as of December 31, 2025

3 unchanged sentences

Vesting of restricted stock units

Issuance of common stock, net of fees

Transfer of common stock

( 1,367,731 )

Repurchase of common stock

( 1,160,542 )

( 1,160,574 )

Stock-based compensation expense

6 unchanged sentences

( 37,550,082 )

Balance as of March 31, 2026

Balance as of June 30, 2026

( 279,128,670 )

4 unchanged sentences

Issuance of common stock, net of fees

Transfer of common stock

Repurchase of common stock

Stock-based compensation expense

Convertible note beneficial conversion feature

Issuance of warrants

Digital assets market value adjustment

3 unchanged sentences

( 11,750,000 )

Net income (loss)

( 53,073,460 )

( 53,036,803 )

Balance as of March 31, 2025

Balance as of June 30, 2025

( 124,125,886 )

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities:

6 unchanged sentences

Stock-based compensation expense

Net loss on digital assets

Net loss (gain) on digital assets

( 4,153,223 )

Impairment of failed acquisition

Investments in affiliates gain

1 unchanged sentence

Paid-in-kind interest

Bad debt expense (recovery)

Bad debt recovery

Change in operating assets and liabilities:

Accounts receivable

( 4,677,116 )

Physical inventory

4 unchanged sentences

Licensing receivables

( 3,533,362 )

Other long-term assets

11 unchanged sentences

Collections of notes receivable

Advances to acquisition target

( 8,193,364 )

Sale of digital assets

3 unchanged sentences

Purchase of content

( 4,274,150 )

Investments in affiliates

( 2,982,032 )

Return on investments in affiliates

12 unchanged sentences

Issuance of common stock

Investments in minority owned entities

Contribution of equity in noncontrolling interests

Redemption of equity in noncontrolling interests

1 unchanged sentence

( 11,750,000 )

Fees related to issuance of common stock and minority interest

( 2,024,388 )

Repurchase of common stock

( 1,160,574 )

Debt financing fees

1 unchanged sentence

( 1,071,367 )

Net increase (decrease) in cash and cash equivalents

( 5,207,473 )

Net increase in cash and cash equivalents

Cash and cash equivalents at beginning of period

5 unchanged sentences

Change from digital assets to digital assets receivable

Issuance of warrants

Operating lease right-of-use assets and liabilities

See accompanying notes to the condensed consolidated financial statements

28 unchanged sentences

In the opinion of the Company’s management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been reflected in these unaudited condensed consolidated financial statements.

Operating results for the three months ended March 31, 2026 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2026.

Operating results for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2026.

The balance sheet at December 31, 2025 has been derived from the audited financial statements at that date, but does not include all the information and footnotes required by GAAP for complete financial statements.

25 unchanged sentences

However, digital assets may be subject to volatile market prices, which may be unfavorable at the time when the Company wants or needs to liquidate them.

The Company has ownership of and control over their digital assets and may use third-party custodial services to secure them.

The Company has ownership of and control over its digital assets and may use third-party custodial services to secure them.

The digital assets are initially recorded at cost and are subsequently remeasured on the condensed consolidated balance sheet at fair value.

5 unchanged sentences

The condensed consolidated financial statements have been prepared assuming the Company will continue to operate as a going concern within one year from the date of issuance of these condensed consolidated financial statements.

For the three months ended March 31, 2026, the Company incurred a net loss of approximately $ 13.8 million and had cash provided by operating activities of approximately $ 1.9 million.

The Company had an accumulated deficit of approximately $ 255.3 million as of March 31, 2026.

Management is working to increase revenues through the growth of Angel Guild memberships, the Company’s pipeline of theatrical releases through 2026 and additional streaming agreements.

For the six months ended June 30, 2026, the Company incurred a net loss of approximately $ 37.6 million and had cash provided by operating activities of approximately $ 18.8 million.

The Company had an accumulated deficit of approximately $ 279.1 million as of June 30, 2026.

Management is working to increase revenues through the growth of Angel Guild memberships, the Company’s pipeline of theatrical releases during the second half of 2026 and additional streaming agreements.

During the six months ended June 30, 2026, the Company generated approximately $ 190.5 million in cash from Angel Guild paid memberships.

The Company has historically financed marketing activities for theatrical releases through two primary methods:

1) Regulation A offerings that are tailored to raise money for the print and advertising costs (“P&A”) for specific theatrical releases and 2) P&A loan agreements with individual and institutional investors.

During the three months ended March 31, 2026, the Company did not raise any money from Regulation A offerings or P&A loans.

During the six months ended June 30, 2026, the Company raised $ 0.0 million from Regulation A offerings and received $ 10.0 million from P&A loans.

During the year ended December 31, 2025, the Company raised $ 13.2 million from Regulation A offerings and received $ 84.0 million from P&A loans.

During the three months ended March 31, 2026, the Company paid $ 18.7 million for the repayments of P&A loans, including interest and paid $ 5.9 million as a redemption of shares for Regulation A investors, from the proceeds collected from the theatrical releases and other revenues earned.

During the six months ended June 30, 2026, the Company paid $ 57.6 million for the repayments of P&A loans, including interest and paid $ 5.9 million as a redemption of shares for Regulation A investors, from the proceeds collected from the theatrical releases and other revenues earned.

During the year ended December 31, 2025, the Company paid $ 43.5 million for the repayments of P&A loans, including interest and paid $ 15.8 million as a redemption of shares for Regulation A investors, from the proceeds collected from the theatrical releases and other revenues earned.

Additionally, the Company has raised capital through the sale of its Common Stock, generating $ 104.1 million of cash during the year ended December 31, 2025.

The Company did no t generate any cash through the sale of its Common Stock during the three months ended March 31, 2026.

During the three months ended March 31, 2026, the Company generated approximately $ 92.2 million in cash from Angel Guild paid memberships.

In addition, in April 2026, the Company issued Common Stock through a public offering for aggregate proceeds of $ 34.5 million.

The Company issued Common Stock through a public offering for aggregate proceeds of $ 34.5 million during the six months ended June 30, 2026.

As the Company continues to grow, management expects that the existing capital resources, including cash, accounts receivables, licensing receivables, recurring revenues from its membership base, the ability to draw on its existing debt facility, and the ability to sell its digital assets if necessary, will be sufficient to meet the Company’s operating requirements for at least the next twelve months.

5 unchanged sentences

Recoveries of receivables previously written off are recorded when payment is received.

As of March 31, 2026, the allowance for doubtful accounts receivable was $ 0.5 million.

As of June 30, 2026, the allowance for doubtful accounts receivable was $ 0.4 million.

As of December 31, 2025, the Company’s allowance for doubtful accounts receivable was $ 0.6 million.

12 unchanged sentences

The Company periodically reviews the physical inventory for excess supply, obsolescence, and valuations above estimated realization amounts, and provides a reserve to cover these items.

Management determined that no reserve for physical inventory was necessary as of March 31, 2026, and December 31, 2025.

Management determined that no reserve for physical inventory was necessary as of June 30, 2026, and December 31, 2025.

Prepaid Expenses and Other

32 unchanged sentences

Impairment of Long-Lived Assets

No significant write-downs of long-lived assets occurred during the three months ended March 31, 2026 and 2025.

No significant write-downs of long-lived assets occurred during the three and six months ended June 30, 2026 and 2025.

Investments in Affiliates

5 unchanged sentences

Under the measurement alternative, the Company’s investment is stated at cost and will be reduced by any distributions received.

The Company also holds variable interests in one or more entities through guarantee arrangements, whereby the Company guarantees repayment of third-party loans made to one or more independent film production company.

The Company evaluated the film production companies under ASC 810, Consolidation, and determined that they are variable interest entities in which the Company holds a variable interest.

The Company concluded that it is not the primary beneficiary because it does not have the power to direct the activities that most significantly impact the Borrower's economic performance, which are driven by the filmmaker's creative and production decisions in making the film.

Accordingly, the film production companies are not consolidated in the Company's condensed consolidated financial statements.

Notes Receivable

7 unchanged sentences

Recoveries of notes receivable previously charged off are recorded when payment is received.

The allowance for doubtful notes receivable was $ 0.0 million as of March 31, 2026 and December 31, 2025.

The allowance for doubtful notes receivable was $ 0.0 million as of June 30, 2026 and December 31, 2025.

Other Long-Term Assets

Other long-term assets mainly consist of security deposits that will be held for longer than one year and are recorded at fair value when paid and deferred tax assets.

Any impairment in the other long-term assets will be recognized on the condensed consolidated statements of operations.

Other long-term assets consist primarily of payments made to certain partners that the Company has determined are probable of being acquired, which payments are being used to fund content development that eventually will be on Angel's streaming platform.

Once the acquisition closes, the asset will be converted to Content and begin amortizing once the content is released on the platform.

Any impairment in other long-term assets is recognized in the condensed consolidated statements of operations.

Accrued Expenses

10 unchanged sentences

Deferred Revenue

Deferred revenue represents payments received in advance of the Company fulfilling its performance obligations under various arrangements, including Angel Guild memberships, content licensing, Pay it Forward payments for theatrical releases, theatrical ticket

presales and other deferred revenue.

Deferred revenue represents payments received in advance of the Company fulfilling its performance obligations under various arrangements, including Angel Guild memberships, content licensing, theatrical ticket presales and other deferred revenue.

The Company recognizes deferred revenue when cash is received before the related revenue recognition criteria are met, and such amounts are recognized as revenue when the related performance obligations are satisfied.

1 unchanged sentence

Angel Guild membership fees, which include multiple membership options, are recorded as deferred revenue when received.

As of March 31, 2026 and December 31, 2025, the Company had $ 73.6 million and $ 64.8 million, respectively, of deferred revenue related to Angel Guild memberships.

As of June 30, 2026 and December 31, 2025, the Company had $ 81.3 million and $ 64.8 million, respectively, of deferred revenue related to Angel Guild memberships.

These amounts are expected to be recognized as revenue over the membership period and within the next twelve months.

Theatrical Ticket Presales

The Company records deferred revenue related to theatrical ticket presales, which represent payments received in advance of scheduled theatrical releases.

Revenue is recognized when the related theatrical releases occur.

As of March 31, 2026 and December 31, 2025, the Company had $ 0.5 million and $ 0.6 million, respectively, of deferred revenue related to these presales.

Other Deferred Revenue

As of March 31, 2026 and December 31, 2025, the Company had $ 0.6 million and $ 1.1 million, respectively, in deferred revenue from various other types of contractual arrangements.

As of June 30, 2026 and December 31, 2025, the Company had $ 1.2 million and $ 1.7 million, respectively, in deferred revenue from various other types of contractual arrangements.

These amounts will be recognized as revenue when the performance obligations are satisfied, primarily within the next twelve months.

As of December 31, 2025, the Company had $ 66.5 million of total deferred revenue.

Of this amount, $ 17.5 million and $ 47.7 million were recognized as revenue during the three and six months ended June 30, 2026.

Revenue Recognition

8 unchanged sentences

The following components represent the most significant portions of revenue being recognized:

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

Content licensing

Pay it Forward

Theatrical Pay it Forward

Total Revenue

8 unchanged sentences

Revenue from these events is recognized at a point in time – when the theatrical showing takes place.

The Company will negotiate the terms of the theatrical distribution window (ranging from a few weeks to a few months), profit sharing percentage, and collection terms with the theater owners prior to the release.

The Company will negotiate the terms of the theatrical distribution window (ranging from a few weeks to a few months), profit

sharing percentage, and collection terms with the theater owners prior to the release.

Theatrical release revenue fluctuates depending on the timing and scale of theatrical showings.

11 unchanged sentences

While the Company believes these estimates are reasonable estimates of the amounts due under these arrangements, such estimated amounts could differ from the actual amounts to be subsequently reported by the customer, which could be higher or lower than the Company’s estimates, and could result in an adjustment to revenues in future periods.

Any adjustments booked during the three months ended March 31, 2026 and 2025 have been immaterial.

Any adjustments booked during the three and six months ended June 30, 2026 and 2025 have been immaterial.

For certain multi-year licensing arrangements, payments may be due over a longer period.

2 unchanged sentences

The Company does not assess contracts with deferred payments for significant financing components if, at contract inception, the Company expects the period between fulfillment of the performance obligation and subsequent payment to be one year or less.

Content licensing arrangements can last between several months to up to ten years .

Content licensing arrangements can last between several months and up to ten years .

The typical period ranges around three years .

3 unchanged sentences

Revenue is recognized upon shipment of the merchandise and is recognized at a point in time, when physically shipped.

Pay it Forward Revenue

Pay it Forward revenue consists of payments made from customers who want to keep the Company’s content free to general users and help create future episodes and seasons of their favorite shows.

Pay it Forward revenues are reported as Pay it Forward revenue in the condensed consolidated statements of operations in accordance with ASC Topic 958, Not-for-Profit Entities.

Theatrical Pay it Forward Revenue

The Company also collects Pay it Forward payments for the Company’s upcoming or current theatrical releases.

These collections are used to offset the cost the Company incurs to purchase free or discounted tickets (“Ticket Redemption Expenses”) for people who may not have otherwise been able to watch the film.

If total theatrical Pay it Forward payments are in excess of total Ticket Redemption Expenses, the excess amount will initially be included on the Company’s condensed consolidated financial statements as deferred revenue.

Deferred revenue will be recognized as Pay it Forward revenue during a reporting period if future Ticket Redemption Expenses are expected to be less than the deferred revenue balance.

Other Revenue

1 unchanged sentence

Other revenue is recognized when the services are performed or when the event takes place.

The Company's remaining performance obligations consist primarily of Angel Guild memberships, for which unrecognized amounts are reflected in deferred revenue above.

The Company does not disclose revenue by geography as it is impracticable to do so.

12 unchanged sentences

It also includes costs incurred by the Company to purchase movie tickets for giving away, which costs are offset by the Pay it Forward receipts the Company receives from customers who Pay it Forward for others to see the show.

The total amount of Pay it Forward receipts that were offset against selling and marketing costs for the three months ended March 31, 2026, and 2025, were $ 1.5 million and $ 0.3 million, respectively.

The total amount of Pay it Forward receipts that were offset against selling and marketing costs for the three months ended June 30, 2026, and 2025, were $ 0.5 million and $ 2.2 million, respectively, and for the six months ended June 30, 2026 and 2025, were $ 2.1 million and $ 2.5 million, respectively.

General and Administrative Expenses

20 unchanged sentences

federal jurisdiction and certain state jurisdictions.

As of March 31, 2026 and December 31, 2025, the Company had $ 0.0 million of deferred tax assets.

As of June 30, 2026 and December 31, 2025, the Company had $ 0.0 million of deferred tax assets.

Basic and Diluted Earnings (Loss) Per Share

15 unchanged sentences

The CODM reviews consolidated operating results, primarily focusing on revenue, operating income (loss), and key expense categories to assess performance and make strategic decisions.

The single reportable segment derives its revenue as described above, primarily from Angel Guild revenue, theatrical release revenue, content licensing, merchandise revenue, Pay it Forward revenue and other revenue.

The single reportable segment derives its revenue as described above, primarily from Angel Guild revenue, theatrical release revenue, content licensing, merchandise revenue and other revenue.

Segment profit or loss is measured consistently with the consolidated operating income (loss) presented in the condensed consolidated statements of operations.

11 unchanged sentences

The fair value of the warrants and the convertible features of the debt are estimated using the Black-Scholes option pricing model at the time of issuance.

Guarantees of Third-Party Indebtedness

The Company guarantees repayment of certain third-party loans made to independent film production companies.

At the inception of each guarantee, the Company recognizes a guarantee liability measured at fair value in accordance with ASC 460, Guarantees, using a probability-weighted present value of expected cash outflows (Level 3 under ASC 820, Fair Value Measurement).

The offsetting debit is recorded in other long-term assets, representing the expected economic recovery through revenue generated from the distribution of the film (“Producer Royalty Rights”).

The guarantee liability and other long-term assets are reduced pro-rata as Producer Royalty Rights are applied to the outstanding loan balance over the guarantee term, with no income statement impact as long as full recovery is projected.

If a shortfall becomes probable and estimable, the Company recognizes guarantee expense for the net unrecoverable amount, writes off the other long-term assets, and recognizes a royalty recoverable asset for the estimated post-term royalty recovery under ASC 926-20.

See Note 5, Commitments and Contingencies , for further information.

Minimum Royalty Guarantees

The Company enters into agreements with certain filmmakers that guarantee minimum royalty payments over a specified term, regardless of the box office, streaming, or other performance of the underlying content (“Minimum Royalty Guarantees”).

Unlike Guarantees of Third-Party Indebtedness discussed above, Minimum Royalty Guarantees do not involve a guarantee of a third party's indebtedness and are not accounted for under ASC 460.

The Company recognizes royalty expense and a corresponding liability as royalties are earned under the applicable royalty formula, with cash payments reducing the liability.

If the Company determines that royalties expected to be earned over the guarantee term will not be sufficient to satisfy the guaranteed minimum, the Company recognizes the estimated shortfall as expense, with a corresponding liability, in the period the shortfall becomes probable and estimable.

See Note 5, Commitments and Contingencies , for further information regarding amounts outstanding under these arrangements.

Recent Accounting Pronouncements

8 unchanged sentences

The Company is currently evaluating the impact of adopting ASU 2025-11.

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses , which improves the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, SG&A, and research and development).

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses , which improves the disclosures about a public business entity’s expenses and addresses requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, SG&A, and research and development).

Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03.

1 unchanged sentence

Early adoption is permitted.

The amendments should be applied either (1) prospectively to financial statements issued for reporting periods after the effective date or (2) retrospectively to any or all prior periods presented in the financial statements.

The amendments should be applied either (1) prospectively to financial statements issued for reporting periods after the effective date or (2) retrospectively to any or all

prior periods presented in the financial statements.

The Company will review the guidance in ASU 2024-03 and will adopt disclosures as applicable in the fiscal year ended December 31, 2027.

1 unchanged sentence

In September 2025, the FASB issued ASU 2025-06, which amends certain aspects of the accounting for and disclosure of software costs under ASC 350-40.

The ASU makes targeted improvements to ASC 350-40 but does not fully align the framework for accounting for internally developed software costs that are subject to ASC 350-40 with the framework applied to software to be sold or marketed

externally that is subject to ASC 985-20.

The ASU also does not amend the guidance on costs of software licenses that are within the scope of ASC 985-20.

3 unchanged sentences

The adoption of this standard required the capitalization of software costs not previously capitalized under the old standard;

therefore, it required an adjustment to the Company’s

opening Accumulated Deficit balance as of January 1, 2025 to recognize the cumulative effect of initially applying the change in accounting principle to previous periods.

therefore, it required an adjustment to the Company’s opening accumulated deficit balance as of January 1, 2025 to recognize the cumulative effect of initially applying the change in accounting principle to previous periods.

The adjustment subsequently made was a decrease in the accumulated deficit for the year ended December 31, 2024 of $ 12.9 million.

An adjustment to decrease the Company’s Net Loss was required for the three months ended March 31, 2025 of $ 0.1 million.

The per-share impact for the three months ended March 31, 2025 was $ 0.00 for both basic and diluted Net Loss per common share.

An adjustment to decrease the Company’s net loss was required for the three and six months ended June 30, 2025 of $ 0.1 million and $ 0.2 million, respectively.

The per-share impact for the three and six months ended June 30, 2025 was $ 0.00 for both basic and diluted Net Loss per common share.

Recapitalization

1 unchanged sentence

Transaction Proceeds

Upon the closing, the Company received no gross proceeds.

Upon the closing of the Business Combination, the Company received no gross proceeds.

The following table reconciles the elements of the Business Combination to the condensed consolidated statements of cash flows and the condensed consolidated statement of changes in stockholders’ equity for the period ended September 30, 2025, the interim period in which the Business Combination occurred:

12 unchanged sentences

The table below summarizes the digital assets shown on the Company’s condensed consolidated balance sheets as of:

March 31, 2026

June 30, 2026

December 31, 2025

5 unchanged sentences

The following table summarizes the Company’s digital asset purchases, dispositions, and gains (losses) on digital assets as calculated for the periods indicated:

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

Approximate number of bitcoin acquired

2 unchanged sentences

Digital asset dispositions

Unrealized loss, net

Unrealized gains (losses), net

( 2,935,243 )

1 unchanged sentence

Notes Payable

The following table summarizes the Company’s debt facilities as of March 31, 2026 and December 31, 2025 (in millions):

March 31, 2026

The following table summarizes the Company’s debt facilities as of June 30, 2026 and December 31, 2025 (in millions):

June 30, 2026

December 31, 2025

1 unchanged sentence

or Arrangement

Carrying Value

Principal Value

Original Principal Amount

18 unchanged sentences

(2) See the Notes with convertible features and/or warrants section below.

(3) The March 31, 2026 balance was paid in full by April 2026.

(3) The current notes mature in September 2026.

Notes with convertible features and/or warrants

9 unchanged sentences

September 2025 note with warrants

In September 2025, The Company entered into a loan and security agreement with certain lenders, which provides up to $ 100.0 million term loan with a delayed draw feature, which is composed of four committed tranches:

In September 2025, the Company entered into a loan and security agreement with certain lenders, which provides for up to a $ 100.0 million term loan with a delayed draw feature, which is composed of four committed tranches:

(i) the first tranche in an aggregate principal amount of $ 40.0 million, which was funded on the closing date;

9 unchanged sentences

The credit facility also requires the Company to maintain a minimum liquidity level and contains events of default applicable to the Company that are customary for agreements of this type.

In connection with the credit facility, the Company issued each lender thereunder a warrant to purchase stock to purchase an aggregate amount of 1,462,682 shares of the Company’s Class A Common Stock with an exercise price per share of $ 7.29 .

In connection with the credit facility, the Company issued each lender thereunder a warrant to purchase an aggregate amount of 1,462,682 shares of the Company’s Class A Common Stock with an exercise price per share of $ 7.29 .

The warrants vest and become exercisable in proportion to and in conjunction with the advancement of each tranche under the credit facility.

15 unchanged sentences

Due to the total fair value of the note, including the warrant, being greater than the principal amount of the note, the effective interest rate is greater than the coupon rate and is approximately 14.5 %.

The following table summarizes further details of the outstanding notes with convertible features and/or warrants as of March 31, 2026:

The following table summarizes further details of the outstanding notes with convertible features and/or warrants as of June 30, 2026:

Issuance Date

10 unchanged sentences

Components and Fair Value of the Convertible Notes

The convertible note consisted of the following components as of March 31, 2026 and December 31, 2025.

The convertible note consisted of the following components as of June 30, 2026 and December 31, 2025.

The principal shown in the table below consists of the principal amount of the note as well as the interest (which is paid-in-kind each month):

March 31, 2026

June 30, 2026

Outstanding Principal Amount

11 unchanged sentences

Interest Expense of the Convertible Notes

The following table summarizes interest expenses related to the convertible notes:

Three Months Ended March 31, 2026

The following table summarizes interest expenses related to the convertible notes for the three and six months ended June 30, 2026 and 2025:

Three Months Ended June 30, 2026

Six Months Ended June 30, 2026

Contractual Interest Expense

Amortization of Debt Discount

Contractual Interest Expense

Amortization of Debt Discount

May 2025 convertible note

Three Months Ended June 30, 2025

Six Months Ended June 30, 2025

Contractual Interest Expense

Amortization of Debt Discount

Contractual Interest Expense

Amortization of Debt Discount

May 2025 convertible note

Commitments and Contingencies

7 unchanged sentences

The Company assesses whether there is a reasonable possibility that a loss, or additional losses beyond those already accrued, may be incurred (“Material Loss”).

If there is a reasonable possibility that a Material Loss may be incurred, the Company discloses an estimate or range of the amount of loss, either individually or in the aggregate, or discloses that an estimate of loss cannot be made.

If there is a reasonable possibility that a Material Loss may be incurred, the Company discloses an estimate

or range of the amount of loss, either individually or in the aggregate, or discloses that an estimate of loss cannot be made.

If a Material Loss occurs due to an unfavorable outcome in any legal matter, this may have an adverse effect on the consolidated financial position, results of operations, and liquidity of the Company.

The Company records a provision for each liability when determined to be probable, and the amount of the loss may be reasonably estimated.

These provisions are reviewed annually and adjusted as additional information becomes available.

These provisions are reviewed quarterly and adjusted as additional information becomes available.

Management, after consultation with legal counsel, believes that the outcome of these proceedings will not have a material impact on the Company’s consolidated financial position, results from operations or liquidity.

5 unchanged sentences

The plaintiffs alleged that the Company unlawfully decrypted and infringed 819 titles.

In 2019, the court granted the Plaintiff’s motion for partial summary judgment on liability, and a jury trial resulted in a $ 62.4 million award, including $ 61.4 million for willful copyright infringement ( $ 75,000 per title) and $ 1.0 million for DMCA violations ( $ 1.3 thousand per title).

In 2019, the court granted the Plaintiffs’ motion for partial summary judgment on liability, and a jury trial resulted in a $ 62.4 million award, including $ 61.4 million for willful copyright infringement ( $ 75,000 per title) and $ 1.0 million for DMCA violations ( $ 1.3 thousand per title).

A judgment was entered in September 2019, with plaintiffs also seeking costs and attorneys' fees.

5 unchanged sentences

The Company elected the five-year option and fully repaid the $ 7.8 million by September 30, 2025.

The foregoing summary of certain provisions of the Reorganization Plan and related settlement agreement are not complete and are subject to and qualified in their entirety by reference to the Reorganization Plan and Disney Settlement Agreement, copies of which can be found in the Angel Legacy Report on Form 1-U filed on September 15, 2020, under “Item 2.1, Exhibits,” and the terms of which are incorporated by reference herein.

The foregoing summary of certain provisions of the Reorganization Plan and related settlement agreement is not complete and are subject to and qualified in their entirety by reference to the Reorganization Plan and Disney Settlement Agreement, copies of which can be found in the Angel Legacy Report on Form 1-U filed on September 15, 2020, under “Item 2.1, Exhibits,” and the terms of which are incorporated by reference herein.

Mergers and Acquisitions

2 unchanged sentences

$ 2.0 million each is to be paid on or before May 31, 2025, June 30, 2025, and July 31, 2025.

The purchase is now complete and the final payment has been completed.

As of July 31, 2025, the final payment has been made and the purchase is complete.

With this purchase, Angel Studios now controls the rights, title, and interest in the film, including any subsequent productions.

11 unchanged sentences

Under the terms of the Homestead Merger Agreement, if the merger is completed, at the effective time of the merger, the following consideration will be payable:

at the effective time, each holder of issued and outstanding shares of Black Autumn Stock will be entitled to receive (a) that number of shares of the Company’s Class A Common Stock equal to (i)(A) the Homestead Per Share Merger Consideration multiplied by (B) the number of shares of Black Autumn Common Stock, par value $ 0.00001 per share, Black Autumn Series A-1 Preferred Stock, par value $ 0.00001 per share, Black Autumn Series A-CF Preferred Stock, par value $ 0.00001 per share and Black Autumn Series Seed Preferred Stock, par value $ 0.00001 per share, held

by such holder as of immediately prior to the effective time, divided by (ii) $ 6.13 , plus (b) such holder’s Homestead Pro Rata Share of the Homestead Royalty Shares.

On November 14, 2025, the Company entered into an agreement and plan of merger (“TCP Merger Agreement”) pursuant to which the Company will acquire directly or indirectly all of the equity interests of Toothy Cow Productions, LLC.

(“TCP”), which owns the rights to the Wingfeather Saga series.

On November 14, 2025, the Company entered into an agreement and plan of merger (as amended and restated on June 29, 2026, the “TCP Merger Agreement”) pursuant to which the Company will acquire directly or indirectly all of the equity interests of Toothy Cow Productions, LLC (“TCP”), which owns the rights to the Wingfeather Saga series.

Under the terms of the TCP Merger Agreement, if the merger is completed, at the effective time of the merger, the following consideration will be payable:

at the effective time, all of the issued and outstanding common units of membership interests of TCP (the “TCP Common Units”), preferred unit of membership interests of TCP designated as Class A Preferred Units (the “TCP Class A Preferred Units”), and preferred unit of membership interests of TCP designated as Class B Preferred Units (the “TCP Class B Preferred Units,” and, collectively with the TCP Common Units and the TCP Class B Preferred Units, the “TCP Units”) will be cancelled and extinguished and converted automatically into the right to receive a portion of the TCP Aggregate Stock Consideration.

With respect to holders of TCP Units, the TCP Aggregate Stock Consideration is equal to (a) the TCP Stock Consideration Per Common Unit, multiplied by (b) the number of shares of TCP Units held by such holder as of immediately prior to the TCP Closing;

with respect to holders of TCP Class A Preferred Units, the TCP Aggregate Stock Consideration is equal to (a) the TCP Stock Consideration Per Class A Preferred Unit, multiplied by (b) the number of shares of TCP Class A Preferred Units held by such holder as of immediately prior to the TCP Closing;

and with respect to holders of TCP Class B Preferred Units, the TCP Aggregate Stock Consideration is equal to (a) the TCP Stock Consideration Per Class B Preferred Unit, multiplied by (b) the number of shares of TCP Class B Preferred Units held by such holder as of immediately prior to the TCP Closing.

at the effective time of the merger, all of the issued and outstanding TCP Units will be cancelled and extinguished and converted automatically into the right to receive a portion of the TCP Aggregate Stock Consideration equal to the TCP Aggregate Stock Consideration multiplied by such TCP Unitholder’s TCP Adjusted Percentage Interest at the effective time of the merger.

All capitalized terms used in this paragraph are used as defined in the TCP Merger Agreement, which is referenced as an exhibit to this Form 10-Q.

2 unchanged sentences

Accordingly, production costs funded by the Company are capitalized as content costs.

As of March 31, 2026, the Company has capitalized approximately $ 1.9 million of production costs related to The Wingfeather Saga, which are presented as Long-Term Assets on the condensed consolidated balance sheets.

On November 14, 2025, the Company entered into an agreement and plan of merger (“TTS Merger Agreement”) pursuant to which the Company will acquire directly or indirectly all of the equity interests of Tuttle Twins Show, LLC.

(“TTS”), which owns the rights to the Tuttle Twins series.

As of June 30, 2026, the Company has capitalized approximately $ 3.3 million of production costs related to The Wingfeather Saga, which are presented as Long-Term Assets on the condensed consolidated balance sheets.

The Company is contractually obligated to complete the TCP Merger before October 31, 2026, subject to the receipt of regulatory approvals and the satisfaction of customary closing conditions.

As of the date of this Form 10-Q, the TCP Merger has not closed.

On November 14, 2025, the Company entered into an agreement and plan of merger (as amended and restated on June 29, 2026, the “TTS Merger Agreement”) pursuant to which the Company will acquire directly or indirectly all of the equity interests of Tuttle Twins Show, LLC (“TTS”), which owns the rights to the Tuttle Twins series.

Under the terms of the TTS Merger Agreement, if the merger is completed, at the effective time of the merger, the following consideration will be payable:

at the Effective Time, all of the issued and outstanding common units of membership interests of TTS (the “TTS Common Units”) and preferred units of membership interests of TTS (the “TTS Preferred Units,” and, together with the TTS Common Units, the “TTS Units”) will be cancelled and extinguished and converted automatically into the right to receive the TTS Merger Consideration, consisting of, as applicable, (a) for TTS Investors, an amount in cash equal to the TTS Investor Per Unit Cash Consideration and a number of shares of the Company’s Class A Common Stock equal to the TTS Investor Per Unit Stock Consideration, (b) for TTS Key Operators, a number of shares of Company Class A Common Stock equal to the TTS Key Operator Per Unit Stock Consideration.

at the effective time of the merger, all of the issued and outstanding TTS Units will be cancelled and extinguished and converted automatically into the right to receive the TTS Merger Consideration, consisting of, as applicable, (a) for TTS Investors, an amount per TTS Investor Unit in cash equal to the TTS Investor Per Unit Cash Consideration and a number of shares of the Company’s Class A Common Stock per TTS Investor Unit equal to the TTS Investor Per Unit Stock Consideration and (b) for TTS Key Operators, a number of shares of Company Class A Common Stock per TTS Key Operator Unit equal to the TTS Key Operator Per Unit Stock Consideration.

All capitalized terms used in this paragraph are used as defined in the TTS Merger Agreement, which is referenced as an exhibit to this Form 10-Q.

2 unchanged sentences

Accordingly, production costs funded by the Company are capitalized as content costs.

As of March 31, 2026, the Company has capitalized approximately $ 1.2 million of production costs related to The Tuttle Twins show, which are present ed as Long-Term Assets on the condensed consolidated balance sheet.

The Company has authorized Common Stock consisting of 700,000,000 shares, of which 500,000,000 shares have been designated as Class A Common Stock and 200,000,000 have been designated as Class B Common Stock.

As of June 30, 2026, the Company has capitalized approximately $ 3.1 million of production costs related to The Tuttle Twins show, which are present ed as Long-Term Assets on the condensed consolidated balance sheet.

The Company is contractually obligated to complete the TTS Merger before October 31, 2026, subject to the receipt of regulatory approvals and the satisfaction of customary closing conditions.

As of the date of this Form 10-Q, the TTS Merger has not closed.

Guarantees of Third-Party Indebtedness

The Company guarantees repayment of certain third-party loans made to independent film production companies.

The Company acts as the film distributor and collection account manager, remitting the royalties from the distribution of the film, the Producer Royalty Rights, directly to lender as the primary source of loan repayment during the loan term.

If the Producer Royalty Rights remitted over the guaranteed term are insufficient to repay the loan in full and the film production company is unable to cover the balance of the loan, the Company is obligated to fund the remaining balance to the lender under a contractual payment undertaking (the "Angel Backstop").

The Angel Backstop is an unconditional and irrevocable guarantee of the Borrower's loan repayment obligation.

The Angel Backstop is recognized as a guarantee liability at a Day 1 fair value in accordance with ASC 460, Guarantees, using the probability-weighted present value methodology described in Note 1.

The offsetting debit was recorded as a deferred guarantee cost, presented within other long-term assets on the condensed consolidated balance sheet, representing the expected economic recovery of the guarantee obligation through Producer Royalty Rights.

After initial recognition, the guarantee liability and deferred guarantee cost are reduced pro-rata as Producer Royalty Rights are applied to the outstanding loan balance.

The following table presents information about the Angel Backstop as of June 30, 2026:

June 30, 2026

Outstanding loan balance guaranteed (undiscounted)

Maximum potential undiscounted future payments (1)

Angel Backstop liability (carrying value) (2)

Deferred Guarantee Cost (carrying value) (2)

(1) Represents the full outstanding loan balance as of the balance sheet date, which is the maximum amount the Company could be required to fund to the lender assuming no Producer Royalty Rights are received over the remainder of the guarantee term.

Presented gross and undiscounted and has not been reduced by projected royalty recoveries.

No collateral is held by the Company in connection with the Angel Backstop.

(2) The Angel Backstop liability represents the unamortized Day 1 fair value of the Company's stand-ready guarantee obligation, measured at inception under ASC 460 and subsequently reduced pro-rata as Producer Royalty Rights are applied to the outstanding loan balance.

The Deferred Guarantee Cost is the corresponding asset, carried within other long-term assets on the condensed consolidated balance sheet, and is reduced in tandem with the liability.

The Company assesses the probability of being required to make payments under the Angel Backstop based on current projections of film revenue performance relative to the outstanding loan balance.

As of June 30, 2026, the Company has assessed the payment risk as low.

In the event the Company is required to make a payment under the Angel Backstop, it retains the contractual right to receive post-term Producer Royalty Rights from the Borrower to the extent earned in subsequent periods, representing a potential recovery of amounts funded.

No collateral is held by the Company in connection with this guarantee.

Minimum Royalty Guarantees

The Company has entered into agreements with filmmakers that guarantee minimum royalty payments over specified periods, generally not expected to result in a shortfall given anticipated royalties.

The Company recognizes royalty expense and a corresponding liability as royalties are earned, with cash payments reducing the liability.

As of June 30, 2026, the remaining unrecognized commitments under these agreements are as follows:

Year Ending December 31,

Remainder of 2026

During the three and six months ended June 30, 2026, royalties earned and credited against these guarantees reduced the aggregate remaining commitment by $ 17.0 million and $ 23.6 million.

With respect to the Company's minimum royalty guarantee arrangements, the Company has determined that a shortfall between royalties expected to be earned and the guaranteed minimums is reasonably possible, based on box office, licensing deals, and streaming performance of certain films relative to the original projections.

The Company continues to project that royalties earned over the remaining terms of these arrangements will be sufficient to satisfy the guaranteed minimum, and no shortfall has been deemed probable as of June 30, 2026.

Given the various stages of the distribution windows and in some cases limited performance data to date, the Company is unable to reasonably estimate the amount of any potential shortfall at this time.

The Company will continue to monitor the

performance of the underlying content and will record a liability for each estimated shortfall in the period in which it becomes probable and reasonably estimable.

The Company has authorized Common Stock consisting of 700,000,000 shares, par value $ 0.0001 per share, of which 500,000,000 shares have been designated as Class A Common Stock and 200,000,000 have been designated as Class B Common Stock.

The Company has also authorized preferred stock consisting of 1,000,000 shares, par value $ 0.0001 per share.

2 unchanged sentences

In May 2025, the Company entered into a note and warrant purchase agreement with an unaffiliated third party, providing for the private placement of a subordinated convertible promissory note with a principal balance of $ 5.0 million and warrant to purchase 163,322 shares of the Company’s Class A Common Stock with an exercise price of $ 6.13 per share.

In September 2025, Steve Sarowitz, who is the

controlling person of this unaffiliated third party, became a member of the Company’s board of directors.

In September 2025, Steve Sarowitz, who is the controlling person of this unaffiliated third party, became a member of the Company’s board of directors.

See Note 4, Debt for additional details.

1 unchanged sentence

As part of the initial draw, the lenders received warrants to purchase 585,072 shares of the Company’s Class A Common Stock.

The 2 nd draw was taken by the Company in February 2026, from which the lenders received warrants to purchase 292,537 shares of the Company’s Class A Common Stock.

The second draw was taken by the Company in February 2026, from which the lenders received warrants to purchase 292,537 shares of the Company’s Class A Common Stock.

See Note 4, Debt for additional details.

3 unchanged sentences

For more information regarding the note and warrant purchase agreements, refer to Note 4, Debt.

Common Stock Offering

I n April 2026, the Company entered into an underwriting agreement with an unaffiliated third party for the issuance and sale of 16,445,000 shares of its Class A Common Stock at a price to the public of $ 2.10 per share.

The Company received net proceeds of approximately $ 32.5 million, after underwriting discounts, commissions, and estimated offering expenses.

Loss per Share

The following table represents the Company’s loss per share for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

The following table represents the Company’s loss per share for the three and six months ended June 30, 2026 and 2025:

For the three months ended June 30,

For the six months ended June 30,

Net loss attributable to controlling interests

1 unchanged sentence

( 15,769,536 )

( 37,597,602 )

( 53,073,460 )

Weighted average basic shares outstanding

4 unchanged sentences

Basic loss per share includes no dilution and is computed by dividing net income available to common stockholders by the weighted average common shares outstanding for the period.

Diluted loss per share is calculated similarly to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the common shares were dilutive.

All potential common shares were anti-dilutive as a result of the Company’s net losses during the three months ended March 31, 2026 and 2025.

The following table sets forth the outstanding potentially dilutive securities that have been excluded in the calculation of diluted loss per share as their inclusion would be anti-dilutive, for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

common shares had been issued and if the common shares were dilutive.

All potential common shares were anti-dilutive as a result of the Company’s net losses during the three and six months ended June 30, 2026 and 2025.

Three and Six Months Ended June 30,

Stock options to purchase common stock

5 unchanged sentences

The Company has a marketing services contract with an entity owned by one or more of the Company’s directors, officers, and stockholders.

During the three months ended March 31, 2026 and 2025, the Company incurred expenses of $ 0.1 million and $ 0.1 million, respectively, to the related party for marketing services.

During the three months ended June 30, 2026 and 2025, the Company incurred expenses of $ 0.1 million and $ 0.2 million, respectively, to the related party for marketing services.

During the six months ended June 30, 2026 and 2025, the Company incurred expenses of $ 0.3 million and $ 0.3 million, respectively, to the related party for marketing services.

In February 2024, the Company entered into a revolving P&A loan agreement with Angel P&A, LLC, a Delaware limited liability company (“Angel P&A”) that is 100.0 % owned by one or more of the Company’s directors, officers, and stockholders.

1 unchanged sentence

The revenue participation rights allow Angel P&A the right to receive an amount not to exceed 115.0 % (initial investment plus a 10.0 % to 15.0 % return) of their invested amount.

Angel P&A has priority on the cash receipts to the Company of the particular film they invested in and shall be paid in full before any other claims, with the exception of money raised under Regulation A of Section 3(6) of the Securities Act, for P&A (if any) which would take first priority, from the film are paid.

Angel P&A has priority on the cash receipts to the Company of the particular film they invested in and shall be paid in full before any other claims, with the exception of money raised under Regulation A of Section 3(b) of the Securities Act, for P&A (if any) which would take first priority, from the film are paid.

When Angel P&A receives the repayment on these notes, the interest portion is distributed to the institutional investors and the original investment can either remain at Angel P&A for additional P&A loans needed by the Company or be returned to the institutional investors until the Company has further need of the funds.

2 unchanged sentences

The maturity on the loans is typically due between 80 – 120 days from the individual draw.

As of March 31, 2026 and December 31, 2025, the total outstanding balance of revolving P&A loans was $ 38.5 million and $ 53.5 million, respectively.

As of June 30, 2026 and December 31, 2025, the total outstanding balance of revolving P&A loans was $ 10.0 million and $ 53.5 million, respectively.

In May 2025, the Company entered into a note and warrant purchase agreement with an unaffiliated third party, providing for the private placement of a subordinated convertible promissory note .

3 unchanged sentences

Crane is an executive producer and board member at Black Autumn Show, Inc., the creator of the Homestead film and television series, and Tuttle Twins Show LLC.

The Company has a distribution agreement with the Homestead film and series resulting in payments of $ 6.5 million during the year ended December 31, 2025, and payments of $ 4.0 million during the three months ended March 31, 2026.

Total payments, including royalties paid, to the Tuttle Twins Show LLC, during the year ended December 31, 2025 and the three months ended March 31, 2026, were $ 3.9 million and $ 1.2 million, respectively.

The Company has a distribution agreement with the Homestead film and series resulting in payments of $ 6.5 million during the year ended December 31, 2025, and payments of $ 6.0 million during the six months ended June 30, 2026.

Total payments, including royalties paid, to The Tuttle Twins Show LLC, during the year ended December 31, 2025 and the six months ended June 30, 2026, were $ 3.9 million and $ 2.5 million, respectively.

See Note 5, Commitments and Contingencies , for more information.

Subsequent Events

Subsequent events have been evaluated through April 30, 2026, which is the date the condensed consolidated financial statements were available to be issued.

In April 2026, the Company entered into an underwriting agreement with an unaffiliated third party for the issuance and sale of 16,445,000 shares of its Class A Common Stock at a price to the public of $ 2.10 , for aggregate proceeds of $ 34.5 million.

In April 2026, the Company repaid in full the outstanding balance of $ 38.5 million under its revolving P&A loan facility.

Subsequent events have been evaluated through August 4, 2026, which is the date the condensed consolidated financial statements were issued.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements