What changed in this filing

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Item 1. Financial Statements

2025-04-23 compared with 2024-10-30 · 280 added, 570 removed, 926 unchanged (48% of the section changed)

1 unchanged sentence

The following unaudited Condensed Consolidated Financial Statements are filed as part of this Report:

Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023

Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2024 and 2023

Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2024 and 2023

Condensed Consolidated Statements of Cash Flows for the nine months ended Septem ber 30, 2024 and 2023

Condensed Consolidated Statements of Shareholders’ Equity for the three and nine months ended September 30, 2024 and 2023

Condensed Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024

Condensed Consolidated Statements of Operations for the three months ended March 31, 2025 and 2024

Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2025 and 2024

Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2025 and 2024

Condensed Consolidated Statements of Shareholders’ Equity for the three months ended March 31, 2025 and 2024

Notes to Condensed Consolidated Financial Statements

3 unchanged sentences

Dollars, except share amounts)

September 30, December 31,

March 31, December 31,

Cash and cash equivalents $ 97,069 $ 100,592

43 unchanged sentences

Dollars, except per share amounts)

Three Months Ended Nine Months Ended

September 30, September 30,

2024 2023 2024 2023

Three Months Ended

Technology sales

6 unchanged sentences

86,667 79,123

91,452 103,896 259,536 288,821

Costs and expenses applicable to revenues

Technology sales

10,605 7,948 24,594 28,951

Image enhancement and maintenance services

3 unchanged sentences

53,176 46,889

51,019 62,715 141,835 170,653

Selling, general and administrative expenses

1 unchanged sentence

Research and development

( 265 ) 2,771 3,953 7,388

Amortization of intangible assets

1,544 1,107 4,208 3,328

Credit loss (reversal) expense, net

( 1,137 ) 523 ( 963 ) 1,589

Restructuring and executive transition costs

Restructuring and other charges

Income from operations

1 unchanged sentence

Realized and unrealized investment gains

32 364 94 436

Retirement benefits non-service expense

1 unchanged sentence

Interest income

625 738 1,720 1,838

Interest expense

4 unchanged sentences

( 7,285 ) ( 5,159 )

15,343 15,019 25,836 29,755

Net income attributable to non-controlling interests

3 unchanged sentences

Net income per share attributable to common shareholders:

$ 0.26 $ 0.22 $ 0.39 $ 0.42

Basic and diluted

$ 0.04 $ 0.06

6 unchanged sentences

(In thousands of U.S.

Three Months Ended Nine Months Ended

September 30, September 30,

2024 2023 2024 2023

Three Months Ended

$ 8,150 $ 5,420

Other comprehensive income (loss) before tax

Unrealized net gain (loss) from cash flow hedging instruments

Unrealized net loss from cash flow hedging instruments

( 715 ) ( 916 )

Realized net loss from cash flow hedging instruments

162 174 240 636

Foreign currency translation adjustments

3,775 1,060 2,779 ( 6,559 )

Defined benefit and postretirement benefit plans ( 205 ) ( 249 )

1 unchanged sentence

836 ( 1,696 )

Income tax (expense) benefit related to other comprehensive income (loss)

( 92 ) 274 328 30

Income tax (expense) benefit related to other comprehensive income

Other comprehensive income (loss), net of tax

1 unchanged sentence

Comprehensive income

19,376 15,303 27,692 23,108

Comprehensive income attributable to non-controlling interests

6 unchanged sentences

(In thousands of U.S.

Nine Months Ended

September 30,

Three Months Ended

Operating Activities

$ 8,150 $ 5,420

Adjustments to reconcile net income to cash provided by operating activities:

Adjustments to reconcile net income to cash provided by (used in) operating activities:

Depreciation and amortization

2 unchanged sentences

Credit loss (reversal) expense, net

( 963 ) 1,589

Write-downs, including asset impairments

Deferred income tax benefit

( 7,339 ) ( 3,724 )

Deferred income tax expense

Share-based and other non-cash compensation

17,261 17,830

Unrealized foreign currency exchange (gain) loss

Unrealized foreign currency exchange loss

Realized and unrealized investment gain

9 unchanged sentences

( 2,215 ) ( 17,384 )

Net cash provided by operating activities

Net cash provided by (used in) operating activities

6,951 ( 10,968 )

14 unchanged sentences

Repayments of other borrowings

Proceeds from other borrowings

Repurchase of common shares

( 18,102 ) ( 4,263 )

Taxes withheld and paid on employee stock awards vested

1 unchanged sentence

Common shares issued - stock options exercised

Principal payment under finance lease obligations

( 480 ) ( 480 )

Dividends paid to non-controlling interests

Net cash used in financing activities

( 951 ) ( 24,349 )

Net cash provided by financing activities

Effects of exchange rate changes on cash

Increase in cash and cash equivalents during period

(Decrease) increase in cash and cash equivalents during period

( 3,523 ) 4,817

7 unchanged sentences

(In thousands of U.S.

Three Months Ended Nine Months Ended

September 30, September 30,

2024 2023 2024 2023

Three Months Ended

Adjustments to capital stock:

1 unchanged sentence

$ 401,420 $ 389,048

Employee stock options exercised

Average carrying value of repurchased and retired common shares

— ( 152 ) ( 8,575 ) ( 249 )

Restricted share units vested, net of shares withheld for employee tax obligations

11,380 13,066

Employee stock options exercised, net of shares withheld for employee tax obligations

Grant date fair value of stock options exercised

Average carrying value of repurchased and retired common shares

Balance, end of period

3 unchanged sentences

185,268 185,087

Amortization of share-based payment expense - stock options

Amortization of share-based payment expense - restricted share units

3,318 2,557 10,864 9,881

Amortization of share-based payment expense - performance stock units

1,985 2,071 5,864 5,196

Restricted share units vested

( 20,942 ) ( 17,943 )

Grant date fair value of stock options exercised

Change in ownership interest related to IMAX China

3 unchanged sentences

Balance, beginning of period

3,932 3,932 3,932 3,932

Change in statutory surplus reserve, IMAX China

Balance, end of period

3,932 3,932 3,932 3,932

Adjustments to accumulated deficit:

2 unchanged sentences

Net income attributable to common shareholders

13,896 11,990 20,753 22,795

Statutory surplus reserve deducted from retained earnings, IMAX China

Common shares repurchased and retired

— ( 100 ) ( 7,901 ) ( 1,989 )

Balance, end of period

11 unchanged sentences

Net income attributable to non-controlling interests

1,431 3,100 5,067 7,021

Other comprehensive income (loss), net of tax

1,073 299 789 ( 1,856 )

Share-based compensation attributable to non-controlling interests

58 140 52 288

Dividends paid to non-controlling shareholders of IMAX China — — — ( 1,438 )

Change in ownership interest related to IMAX China common share repurchases

10 unchanged sentences

Accounting Principles

IMAX Corporation, together with its consolidated subsidiaries (the “Company” or “IMAX”), prepares its financial statements in accordance with United States Generally Accepted Accounting Principles (“U.S.

IMAX Corporation (together with its subsidiaries, unless the context requires otherwise, the “Company” or “IMAX”), prepares financial statements in accordance with United States Generally Accepted Accounting Principles (“U.S.

GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”).

Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S.

GAAP have been condensed or omitted from this report, as is permitted by such rules and regulations.

In the Company’s opinion, the unaudited Condensed Consolidated Financial Statements reflect all adjustments of a normal recurring nature that are necessary for a fair statement of the results for the interim periods presented.

The Condensed Consolidated Balance Sheet at December 31, 2023 was derived from the Company’s audited annual Consolidated Financial Statements, but does not contain all of the footnote disclosures included in the annual financial statements.

The interim results presented in the Company’s Condensed Consolidated Statements of Operations are not necessarily indicative of results for a full year.

These Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements included in the Company’s 2023 Annual Report on Form 10-K (the “2023 Form 10-K”), which should be consulted for a summary of the significant accounting policies adopted by the Company.

These Condensed Consolidated Financial Statements are prepared following the same accounting policies disclosed in the 2023 Form 10-K.

Certain information and footnote disclosures have been condensed or omitted as permitted by such rules and regulations.

In the opinion of the Company’s management, the unaudited Condensed Consolidated Financial Statements reflect all necessary adjustments for a fair statement of interim results.

The Condensed Consolidated Balance Sheet at December 31, 2024 was derived from the Company’s audited annual Consolidated Financial Statements in the Company’s 2024 Annual Report on Form 10-K (the “2024 Form 10-K”), but does not contain all of the footnote disclosures included in the annual financial statements.

The interim results presented in the Company’s Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Cash Flows are not necessarily indicative of results for a full year.

These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements in the 2024 Form 10-K, which includes significant accounting policies adopted by the Company.

Principles of Consolidation

These Condensed Consolidated Financial Statements include the accounts of IMAX Corporation together with its consolidated subsidiaries, except for subsidiaries which have been identified as variable interest entities (“VIEs”) where the Company is not the primary beneficiary.

These unaudited Condensed Consolidated Financial Statements include the accounts of IMAX Corporation together with its consolidated subsidiaries, except for subsidiaries which have been identified as variable interest entities (“VIEs”) where the Company is not the primary beneficiary.

All intercompany accounts and transactions have been eliminated.

2 unchanged sentences

The Company is the primary beneficiary of and consolidates five of these entities as it has the power to direct the activities that most significantly impact the economic performance of the VIE, and it has the obligation to absorb losses or the right to receive benefits from the respective VIE that could potentially be significant.

The majority of the assets relating to these production companies are held by the IMAX Original Film Fund (the “Original Film Fund”) as described in Note 16.

The majority of the assets relating to these production companies are held by the IMAX Original Film Fund (the “Original Film Fund”).

The Company does not consolidate the other five film production companies because it does not have the power to direct their activities and it does not have the obligation to absorb the majority of the expected losses or the right to receive expected residual returns.

The Company uses the equity method of accounting for these entities, which are not material to the Company’s Condensed Consolidated Financial Statements.

The Company uses the equity method of accounting for these entities, which continues to not be material to the Company’s Condensed Consolidated Financial Statements.

A change in the value of an equity method investment that is other than temporary is recognized in the Condensed Consolidated Statements of Operations.

As of September 30, 2024 and December 31, 2023, total assets and liabilities of the Company’s consolidated VIEs are as follows:

September 30, December 31,

As of March 31, 2025 and December 31, 2024, total assets and liabilities of the Company’s consolidated VIEs were as follows:

March 31, December 31,

(In thousands of U.S.

4 unchanged sentences

In preparing the Company’s Condensed Consolidated Financial Statements, management makes judgments in applying various accounting policies.

The areas of policy judgment are consistent with those reported in Note 2(b) of the Company’s audited Consolidated Financial Statements included in its 2023 Form 10-K.

Management also considers that its determination of operating and reporting segments represents an area of judgment, and has made this conclusion on the basis of what comprises the discrete financial information produced, but not provided to or used by its Chief Operating Decision Maker (“CODM”) to carry out this function.

In addition, management makes assumptions about the Company’s future operating results and cash flows in deriving critical accounting estimates used in preparing the Condensed Consolidated Financial Statements.

The areas of policy judgment are consistent with those reported in Note 2 of the Company’s audited Consolidated Financial Statements included in its 2024 Form 10-K.

The significant estimates made by management include, but are not limited to:

(i) the allocation of the transaction price in an IMAX System arrangement to distinct performance obligations;

(ii) the amount of variable consideration to be earned on sales of IMAX Systems based on projections of future box office performance;

(ii) the amount of variable consideration to be earned on sales of IMAX Systems based on projections of future box office performance and inflation;

(iii) expected credit losses on accounts receivable, financing receivables, and variable consideration receivables;

5 unchanged sentences

(ix) the ultimate revenue forecasts used to test the recoverability of film assets;

(x) the discount rates used to determine the present value of financing receivables and lease liabilities, as well as to determine the fair values of the Company’s reporting units for the purpose of assessing the recoverability of goodwill;

(x) the discount

rates used to determine the present value of financing receivables, variable consideration and lease liabilities, as well as to determine the fair values of the Company’s reporting units for the purpose of assessing the recoverability of goodwill;

(xi) pension plan assumptions;

3 unchanged sentences

New Accounting Standards and Accounting Changes

Recently Issued FASB Accounting Standard Codification Updates Not Yet Adopted

In November 2023, the FASB issued Accounting Standards Update No.

2023-07, Segment Reporting (Topic 820):

Improvements to Reportable Segment Disclosures (“ASU 2023-07”).

The purpose of ASU 2023-07 is to enhance the interim disclosure requirements by more closely aligning them with the annual requirements.

ASU 2023-07 requires interim and annual disclosures to include information about the company’s significant segment expenses.

ASU 2023-07 will be effective for the Company’s year ended December 31, 2024 and all interim periods thereafter.

The Company is in the process of evaluating the impact of this ASU on its Consolidated Financial Statements.

In December 2023, the FASB issued Accounting Standard Update No.

Issued FASB Accounting Standard Codification Updates Not Yet Adopted

Improvements to Income Tax Disclosures

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No.

2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures” (“ASU 2023-09”).

The amendments in ASU 2023-09 improve the transparency of income tax disclosures by requiring (i) consistent categories and greater disaggregation of information in the rate reconciliation, and (ii) income taxes paid disaggregated by jurisdiction.

ASU 2023-09 will be effective for the Company’s year ended December 31, 2025.

ASU 2023-09 is effective annual periods beginning on or after December 31, 2024.

The Company is in the process of evaluating the impact of this ASU on its annual disclosures in its Consolidated Financial Statements.

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued Accounting Standard Update No.

2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures” (“ASU 2024-03”).

The amendments in ASU 2024-03 expand disclosures about specific expense categories presented on the face of the income statement and addresses requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation and amortization) in commonly presented expense captions (such as cost of sales, selling, general and administrative expenses).

ASU 2024-03 is effective for fiscal years beginning after December 15, 2026 and interim periods thereafter with early adoption permitted.

The Company is in the process of evaluating the impact of this ASU on its Consolidated Financial Statements.

The Company considers the applicability and impact of all recently issued FASB accounting standard codification updates.

Accounting standard updates that are not noted above were assessed and determined to be not applicable or not significant to the Company’s Condensed Consolidated Financial Statements for the period ended September 30, 2024.

ASUs that are not noted above were assessed and determined to be not applicable or not significant to the Company’s Condensed Consolidated Financial Statements for the period ended March 31, 2025.

The ability of the Company to collect its receivables is principally dependent on the viability and solvency of individual theater operators which is significantly influenced by consumer behavior and general economic conditions.

4 unchanged sentences

Changes in credit quality classification are dependent upon management approval.

The Company’s internal credit quality classifications are as follows:

• Good Standing — The theater operator continues to be in good standing as payments and reporting are received on a regular basis.

• Credit Watch — The theater operator has demonstrated a delay in payments, but continues to be in active communication with the Company.

Theater operators placed on Credit Watch are subject to enhanced monitoring.

In addition, depending on the size of the outstanding balance, length of time in arrears, and other factors, future transactions may need to be approved by management.

These receivables are in better condition than those in the Pre-Approved Transactions Only category, but are not in as good condition as the receivables in the Good Standing category.

• Pre-Approved Transactions Only — The theater operator has demonstrated a delay in payments with little or no communication with the Company.

All services and shipments to the theater operator must be reviewed and approved by management.

These receivables are in better condition than those in the All Transactions Suspended category, but are not in as good condition as the receivables in the Credit Watch category.

In certain situations, a theater operator may be placed on nonaccrual status and all revenue recognition related to the theater may be suspended, including the accretion of Finance Income for Financing Receivables.

• All Transactions Suspended — The theater operator is severely delinquent, non-responsive or not negotiating in good faith with the Company.

Once a theater operator is classified within the All Transactions Suspended category, the theater is placed on nonaccrual status and all revenue recognitions related to the theater are suspended, including the accretion of Finance Income for Financing Receivables.

The Company’s internal credit quality classifications are reported in Note 4 of the Company’s audited Consolidated Financial Statements included in its 2024 Form 10-K.

During the period when the accretion of Finance Income is suspended for Financing Receivables, any payments received from a customer are applied against the outstanding balance owed.

4 unchanged sentences

The Company develops an estimate of expected credit losses by class of receivable and customer type through a calculation that utilizes historical loss rates, which are then adjusted for specific receivables that are judged to have a higher-than-normal risk profile after considering management’s internal credit quality classifications.

Additional credit loss provisions are also recorded taking into account macro-economic and industry risk factors.

Additional credit loss provisions are also recorded taking into

account macro-economic and industry risk factors.

The write-off of any billed receivable balance requires the approval of management.

6 unchanged sentences

Accounts receivable also includes amounts due to the Company from movie studios and other content creators principally for digitally remastering films into IMAX formats, as well as for film distribution and post-production services.

The following tables summarize the activity in the allowance for credit losses related to Accounts Receivable for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended Nine Months Ended

September 30, 2024 September 30, 2024

The following tables summarize the activity in the allowance for credit losses related to Accounts Receivable for the three months ended March 31, 2025 and 2024:

Three Months Ended

March 31, 2025

(In thousands of U.S.

Dollars) Theater

Operators Studios Other Total Theater

Operators Studios Other Total

9 unchanged sentences

$ 11,483 $ 1,236 $ 455 $ 13,174

Three Months Ended Nine Months Ended

September 30, 2023 September 30, 2023

Three Months Ended

March 31, 2024

(In thousands of U.S.

Dollars) Theater

Operators Studios Other Total Theater

Operators Studios Other Total

1 unchanged sentence

$ 14,355 $ 616 $ 1,006 $ 15,977

Current period provision (reversal), net

1,953 100 ( 463 ) 1,590 3,392 ( 699 ) ( 253 ) 2,440

Write-offs, net of recoveries

Current period (reversal) provision, net

( 94 ) 14 73 ( 7 )

3 unchanged sentences

$ 14,247 $ 630 $ 1,079 $ 15,956

For the three and nine months ended September 30, 2024, the Company’s allowance for current expected credit losses related to Accounts Receivable decreased by $ 1.4 million and $ 1.5 million, respectively.

For the three and nine months ended September 30, 2023, the Company’s allowance for current expected credit losses related to Accounts Receivable increased by $ 1.1 million and $ 1.0 million, respectively.

For the three months ended March 31, 2025, the Company’s allowance for current expected credit losses related to Accounts Receivable decreased by $ 0.1 million.

The Company recorded $ 0.2 million in write-offs in the allowance for credit losses for the three months ended March 31, 2025.

For the three months ended March 31, 2024, the Company’s allowance for current expected credit losses related to Accounts Receivable decreased by less than $ 0.1 million.

Financing Receivables

Financing receivables are due from theater operators and consist of the Company’s net investment in sales-type leases and receivables associated with financed sales of IMAX Systems.

As of September 30, 2024 and December 31, 2023, financing receivables consist of the following:

September 30, December 31,

As of March 31, 2025 and December 31, 2024, financing receivables consisted of the following:

March 31, December 31,

(In thousands of U.S.

29 unchanged sentences

$ 90,515 $ 90,546

As of September 30, 2024 and December 31, 2023, the weighted-average remaining lease term and weighted-average interest rate associated with the Company’s sales-type lease arrangements and financed sales receivables, as applicable, are as follows:

September 30, December 31,

As of March 31, 2025 and December 31, 2024, the weighted-average remaining lease term and weighted-average interest rate associated with the Company’s sales-type lease arrangements and financed sales receivables, as applicable, were as follows:

March 31, December 31,

(In thousands of U.S.

6 unchanged sentences

9.08 % 8.95 %

The tables below provide information on the Company’s net investment in leases by credit quality indicator as of September 30, 2024 and December 31, 2023.

The amounts disclosed for each credit quality classification are determined on a customer-by-customer basis as per the origination year of the relationship, and include both billed and unbilled amounts.

The tables below provide information on the Company’s net investment in leases by credit quality indicator as of March 31, 2025 and December 31, 2024.

The amounts disclosed for each credit quality classification are determined on a theater-by-theater basis as per the origination year of the relationship, and include both billed and unbilled amounts.

(In thousands of U.S.

By Origination Year

As of September 30, 2024

As of March 31, 2025

2025 2024 2023 2022 2021 Prior Total

25 unchanged sentences

$ 3,469 $ 3,190 $ 3,483 $ 9,425 $ 3,440 $ 6,996 $ 30,003

The tables below provide information on the Company’s financed sales receivables by credit quality indicator as of September 30, 2024 and December 31, 2023.

The tables below provide information on the Company’s financed sales receivables by credit quality indicator as of March 31, 2025 and December 31, 2024.

(In thousands of U.S.

By Origination Year

As of September 30, 2024

As of March 31, 2025

2025 2024 2023 2022 2021 Prior Total

25 unchanged sentences

$ 6,628 $ 8,028 $ 6,278 $ 9,734 $ 7,016 $ 63,023 $ 100,707

The following tables provide an aging analysis for the Company’s net investment in leases and financed sales receivables as of September 30, 2024 and December 31, 2023:

As of September 30, 2024

The following tables provide an aging analysis for the Company’s net investment in leases and financed sales receivables as of March 31, 2025 and December 31, 2024:

As of March 31, 2025

(In thousands of U.S.

15 unchanged sentences

Total $ 1,117 $ 1,237 $ 15,647 $ 18,001 $ 112,709 $ 130,710 $ ( 10,825 ) $ 119,885

The following tables provide information about the Company’s net investment in leases and financed sale receivables with billed amounts past due for which it continues to accrue finance income as of September 30, 2024 and December 31, 2023.

The amounts disclosed for each credit quality classification are determined on a customer-by-customer basis and include both billed and unbilled amounts.

As of September 30, 2024

The following tables provide information about the Company’s net investment in leases and financed sales receivables with billed amounts past due for which it continues to accrue finance income as of March 31, 2025 and December 31, 2024.

The amounts disclosed for each credit quality classification are determined on a theater-by-theater basis and include both billed and unbilled amounts.

As of March 31, 2025

(In thousands of U.S.

15 unchanged sentences

Total $ 949 $ 828 $ 13,328 $ 15,105 $ 62,384 $ ( 1,092 ) $ 76,397

The following table provides information about the Company’s net investment in leases and financed sale receivables that are on nonaccrual status as of September 30, 2024 and December 31, 2023:

As of September 30, 2024

The following table provides information about the Company’s net investment in leases and financed sale receivables that were on nonaccrual status as of March 31, 2025 and December 31, 2024:

As of March 31, 2025

As of December 31, 2024

7 unchanged sentences

Total $ 29,777 $ ( 9,583 ) $ 20,194 $ 29,392 $ ( 8,931 ) $ 20,461

For the three and nine months ended September 30, 2024 and 2023, the Company did not recognize Finance Income related to the net investment in leases on non-accrual status.

For the three and nine months ended September 30, 2024, the Company recognized $ 0.4 million and $ 1.0 million, respectively (2023 — less than $ 0.1 million and $ 0.2 million, respectively) in Finance Income related to the financed sales receivables in nonaccrual status.

The following tables summarize the activity in the allowance for credit losses related to the Company’s net investment in leases and financed sale receivables for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended Nine Months Ended

September 30, 2024 September 30, 2024

For the three months ended March 31, 2025 and 2024, the Company did not recognize Finance Income related to the net investment in leases on nonaccrual status.

For the three months ended March 31, 2025, the Company recognized less than $ 0.1 million (2024 — $ 0.4 million) in Finance Income related to the financed sales receivables in nonaccrual status.

The following tables summarize the activity in the allowance for credit losses related to the Company’s net investment in leases and financed sale receivables for the three months ended March 31, 2025 and 2024:

Three Months Ended

March 31, 2025

(In thousands of U.S.

1 unchanged sentence

in Leases Net Financed

Sales Receivables Net Investment

in Leases Net Financed

Sales Receivables

2 unchanged sentences

Current period provision (reversal), net

67 ( 148 ) 70 ( 135 )

Foreign exchange

— 27 ( 6 ) 22

Ending balance

$ 667 $ 9,957

Three Months Ended Nine Months Ended

September 30, 2023 September 30, 2023

Three Months Ended

March 31, 2024

(In thousands of U.S.

1 unchanged sentence

in Leases Net Financed

Sales Receivables Net Investment

in Leases Net Financed

Sales Receivables

1 unchanged sentence

$ 453 $ 9,617

Current period reversal, net

11 ( 1,075 ) ( 70 ) ( 862 )

Current period provision (reversal), net

Foreign exchange

( 20 ) 119 ( 26 ) ( 12 )

Ending balance

$ 451 $ 9,616

For the three and nine months ended September 30, 2024, the Company’s allowance for current expected credit losses related to its net investment in leases increased by $ 0.1 million, respectively, and financed sale receivables decreased by $ 0.1 million, respectively.

For the three and nine months ended September 30, 2023, the Company’s allowance for current expected credit losses related to its net investment in leases decreased by less than $ 0.1 million and $ 0.1 million, respectively, and financed sale receivables decreased by $ 1.0 million and $ 0.9 million, respectively.

For the three months ended March 31, 2025, the Company’s allowance for current expected credit losses related to its net investment in leases increased by less than $ 0.1 million (2024 — decreased by less than $ 0.1 million), and financed sale receivables decreased by $ 0.2 million (2024 — decreased by less than $ 0.1 million)

Variable Consideration Receivables

2 unchanged sentences

Variable consideration is only recognized to the extent the Company believes there is not a risk of significant revenue reversal.

The following table summarizes the activity in the Allowance for Credit Losses related to Variable Consideration Receivables for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended Nine Months Ended

September 30, September 30,

2024 2023 2024 2023

The following table summarizes the activity in the Allowance for Credit Losses related to Variable Consideration Receivables for the three months ended March 31, 2025 and 2024:

Three Months Ended

(In thousands of U.S.

Beginning balance

$ 677 $ 705 $ 633 $ 610

Current period provision, net

116 37 160 134

Current period provision (reversal), net

Foreign exchange

3 ( 15 ) 3 ( 17 )

Ending balance

$ 796 $ 727 $ 796 $ 727

For the three and nine months ended September 30, 2024, the Company’s allowance for current expected credit losses related to Variable Consideration Receivables increased by $ 0.1 million and $ 0.2 million, respectively (2023 — increased by less than $ 0.1 million and $ 0.1 million, respectively).

For the three months ended March 31, 2025, the Company’s allowance for current expected credit losses related to Variable Consideration Receivables decreased by less than $ 0.1 million (2024 — increased by less than $ 0.1 million).

Lease Arrangements

13 unchanged sentences

The incremental borrowing rate used in the calculation of the lease liabilities is based on the rate of interest the Company would have to pay to borrow on a collateralized basis over a similar term.

For the three and nine months ended September 30, 2024 and 2023, the components of lease expense recorded within Selling, General and Administrative Expenses are as follows:

Three Months Ended Nine Months Ended

September 30, September 30,

For the three months ended March 31, 2025 and 2024, the components of lease expense recorded within Selling, General and Administrative Expenses was as follows:

Three Months Ended

(In thousands of U.S.

2024 2023 2024 2023

Operating lease cost:

6 unchanged sentences

Total lease cost $ 917 $ 882

For the nine months ended September 30, 2024 and 2023, supplemental cash and non-cash information related to leases is as follows:

Nine Months Ended

September 30,

For the three months ended March 31, 2025 and 2024, supplemental cash and non-cash information related to leases was as follows:

Three Months Ended

(In thousands of U.S.

4 unchanged sentences

Right-of-use assets obtained in exchange for operating lease obligations $ 1,765 $ 260

As of September 30, 2024 and December 31, 2023, supplemental balance sheet information related to leases is as follows:

September 30, December 31,

As of March 31, 2025 and December 31, 2024, supplemental balance sheet information related to leases were as follows:

March 31, December 31,

(In thousands of U.S.

9 unchanged sentences

$ 13,035 $ 11,861

Finance lease liabilities

Accrued and other liabilities

As of September 30, 2024 and December 31, 2023, the weighted-average remaining lease term and weighted-average interest rate associated with the Company’s leases are as follows:

September 30, December 31,

As of March 31, 2025 and December 31, 2024, the weighted-average remaining lease term and weighted-average interest rate associated with the Company’s leases were as follows:

March 31, December 31,

Operating leases:

6 unchanged sentences

6.00 % 6.00 %

As of September 30, 2024, the maturities of the Company’s operating and finance lease liabilities are as follows:

As of March 31, 2025, the maturities of the Company’s operating lease liabilities are as follows:

(In thousands of U.S.

Operating Leases

Finance Leases

2024 (three months remaining) $ 690 $ 35

2025 (nine months remaining) $ 2,470

Thereafter 325

Total lease payments

$ 13,002 $ 35

interest expense

( 1,698 ) ( 8 )

Present value of lease liabilities

$ 11,304 $ 27

IMAX Corporation as a Lessor

2 unchanged sentences

Certain arrangements that are legal sales are also classified as sales-type leases as certain clauses within the arrangements limit transfer of title or provide the Company with conditional rights to the system.

The customer’s rights under the Company’s sales-type lease arrangements are described in Note 2(o) of the Company’s audited Consolidated Financial Statements included in its 2023 Form 10-K.

The customer’s rights under the Company’s sales-type lease arrangements are described in Note 2 of the Company’s audited Consolidated Financial Statements included in its 2024 Form 10-K.

Under the Company’s sales-type lease arrangements, the customer has the ability and the right to operate the hardware components or direct others to operate them in a manner determined by the customer.

3 unchanged sentences

The customer is responsible for obtaining insurance coverage for the IMAX System commencing on the date specified in the arrangement’s shipping terms and ending on the date the IMAX System is returned to the Company.

The Company also provides IMAX Systems to customers through joint revenue sharing arrangements.

Under the traditional form of these arrangements, in exchange for providing the IMAX System under a long-term lease, the Company earns rent based on a percentage of contingent box office receipts and, in some cases, concession revenues, rather than a fixed upfront fee or annual

minimum payments.

Under certain other joint revenue sharing arrangements, known as hybrid arrangements, the customer is responsible for making fixed upfront payments prior to the delivery and installation of the IMAX System.

Under joint revenue sharing arrangements, the customer has the ability and the right to operate the hardware components or direct others to operate them in a manner determined by the customer.

The Company’s joint revenue sharing arrangements are typically non-cancellable for ten years or longer with renewal provisions.

The Company also provides IMAX Systems to customers through joint revenue sharing arrangements (“JRSAs”).

Under certain other JRSAs, known as hybrid arrangements, the customer is responsible for making fixed upfront payments prior to the delivery and installation of the IMAX System.

Under JRSAs, the customer has the ability and the right to operate the hardware components or direct others to operate them in a manner determined by the customer.

The Company’s JRSAs are typically non-cancellable for ten years or longer with renewal provisions.

Title to the IMAX System under a joint revenue sharing arrangement generally does not transfer to the customer.

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The following lease payments are expected to be received by the Company for its sales-type leases and joint revenue sharing arrangements in each of the next four years and thereafter following the September 30, 2024 balance sheet date:

The following lease payments are expected to be received by the Company for its sales-type leases and joint revenue sharing arrangements in each of the remainder of 2025, next four years and thereafter following the March 31, 2025 balance sheet date:

(In thousands of U.S.

Joint Revenue Sharing Arrangements

2024 (three months remaining) $ 788 $ 16

2025 3,089 27

2025 (nine months remaining) $ 2,352 $ 10

Thereafter 16,650 —

$ 31,183 $ 10

As of September 30, 2024 and December 31, 2023, Inventories consist of the following:

September 30, December 31,

As of March 31, 2025 and December 31, 2024, Inventories consisted of the following:

March 31, December 31,

(In thousands of U.S.

4 unchanged sentences

Total $ 31,725 $ 32,840

As of September 30, 2024, Inventories include finished goods of $ 4.7 million (December 31, 2023 — $ 0.6 million) for which title had passed to the customers, but the criteria for revenue recognition were not met as of the balance sheet date.

During the three and nine months ended September 30, 2024, the Company recorded write-downs of $ 0.1 million and $ 0.3 million, respectively, (2023 — a recovery of $ 0.1 million and less than $ 0.1 million, respectively) in Costs and Expenses Applicable to Revenues ― Technology Sales.

As of March 31, 2025, Inventories included finished goods of $ 1.1 million (December 31, 2024 — $ 1.8 million) for which title had passed to the customers, but the criteria for revenue recognition were not met as of the balance sheet date.

During the three months ended March 31, 2025, and 2024, the Company recorded write-downs of $ 0.1 million, and less than $ 0.1 million, in Costs and Expenses Applicable to Revenues ― Technology Sales.

Revolving Credit Facility Borrowings, Net

As of September 30, 2024 and December 31, 2023, Revolving Credit Facility Borrowings, Net includes the following:

September 30, December 31,

As of March 31, 2025 and December 31, 2024, Revolving Credit Facility Borrowings, Net includes the following:

March 31, December 31,

(In thousands of U.S.

5 unchanged sentences

$ 49,472 $ 36,356

Wells Fargo Credit Agreement

On March 25, 2022, the Company entered into a Sixth Amended and Restated Credit Agreement with Wells Fargo Bank, National Association, as agent (the “Agent”), and a syndicate of lenders party thereto (the “Credit Agreement”), which extended the maturity date of the credit facility under the Credit Agreement (the “Credit Facility”) from June 28, 2023 to March 25, 2027.

Credit Agreement

The Company is a party to a Sixth Amended and Restated Credit Agreement, dated as of March 25, 2022 (the “Credit Agreement”), that provides for a credit facility (the “Credit Facility”) maturing March 25, 2027.

The Company’s obligations under the Credit Agreement are guaranteed by certain of the Company’s subsidiaries (the “Guarantors”), and are secured by first-priority security interests in substantially all of the assets of the Company and the Guarantors.

The Credit Agreement has a revolving borrowing capacity of $ 300.0 million, and contains an uncommitted accordion feature allowing the Company to further increase its borrowing capacity by the greater of $ 140.0 million, for a total of $ 440.0 million, or by the Company’s EBITDA for the sum of the four most recently ended fiscal quarters, subject to certain conditions, depending on the mix of revolving loans and/or term loans under the incremental facility and subject to conditions set forth in the Credit Agreement.

The Credit Facility requires that the Company maintain a maximum Senior Secured Net Leverage Ratio (as defined in the Credit Agreement) of no greater than 3.25 :1.00, on the last day of each Fiscal Quarter.

The Senior Secured Net Leverage Ratio is the ratio of Total Debt (as defined in the Credit Agreement), secured by liens, net of unrestricted cash and cash equivalents held outside of the People’s Republic of China (the “PRC”) up to a maximum of $ 75.0 million, relative to Adjusted EBITDA per Credit Facility for the four prior quarters.

The Senior Secured Net Leverage Ratio is calculated using Adjusted EBITDA per Credit Facility determined on a trailing twelve-month basis.

The Company was in compliance with this requirement as of September 30, 2024 as the Senior Secured Net Leverage Ratio was 0.00 :1.00.

Loans under the Credit Facility bear interest, at the Company’s option, at (i) Term Secure Overnight Financing Rate (“Term SOFR”), Eurocurrency Rate or Canadian Dollar Offered Rate (“CDOR”) plus a margin ranging from 1.00 % to 1.75 % per annum;

or (ii) the U.S.

base rate or the Canadian prime rate plus a margin ranging from 0.25 % to 1.00 % per annum, in each case depending on the Company’s total leverage ratio.

In no event will Term SOFR, Eurocurrency Rate, or CDOR be less than 0.00 % per annum.

As of September 30, 2024, borrowings under the Credit Facility were $ 47.0 million (December 31, 2023 — $ 24.0 million) and bear interest at Term SOFR, plus a margin of 1.75 % per annum based on the Company’s total leverage ratio.

The effective interest rate for the three and nine months ended September 30, 2024 was 7.13 % and 7.06 %, respectively.

The Credit Agreement contains customary affirmative and negative covenants, including covenants that limit indebtedness, liens, asset sales, investments and restricted payments, in each case subject to negotiated exceptions and baskets.

The Credit Agreement also contains customary representations, warranties and event of default provisions.

As of September 30, 2024, and December 31, 2023, the Company had no letters of credit or advance payment guarantees outstanding under the Credit Facility.

As of September 30, 2024, the amount available for future borrowings under the Credit Facility was $ 253.0 million (December 31, 2023 — $ 276.0 million).

The Credit Agreement provides for a revolving borrowing capacity of $ 300.0 million, and contains an uncommitted accordion feature allowing the Company to further increase its borrowing capacity by the greater of $ 140.0 million, for a total of $ 440.0 million, or by the Company’s EBITDA (as defined in the Credit Agreement) (“Adjusted EBITDA per Credit Facility”) for the sum of the four most recently ended fiscal quarters, subject to certain conditions, depending on the mix of revolving loans and/or term loans under the incremental facility and subject to conditions set forth in the Credit Agreement.

The Credit Agreement requires that the Company maintain a maximum Senior Secured Net Leverage Ratio (as defined in the Credit Agreement) of no greater than 3.25 :1.00, on the last day of each fiscal quarter.

The Company was in compliance with this requirement as of March 31, 2025 as the Senior Secured Net Leverage Ratio was 0.05 :1.00.

As of March 31, 2025, borrowings under the Credit Facility were $ 50.0 million (December 31, 2024 — $ 37.0 million) and bore interest at Term SOFR (as defined in the Credit Agreement), plus a margin of 1.75 % per annum based on the Company’s total leverage ratio.

The effective interest rate for the three months ended March 31, 2025 was 6.18 % (2024 — 6.93 %).

As of March 31, 2025 and December 31, 2024, the Company had no letters of credit or advance payment guarantees outstanding under the Credit Facility.

As of March 31, 2025, the amount available for future borrowings under the Credit Facility was $ 250.0 million (December 31, 2024 — $ 263.0 million).

Foreign Exchange Facility

Within the Credit Facility, the Company is able to purchase foreign currency forward contracts and/or other swap arrangements.

As of September 30, 2024, the net unrealized gain on the Company’s outstanding foreign currency forward contracts was $ 0.1 million, representing the amount by which the notional value of these forward contracts exceeded their fair value (December 31, 2023 — net unrealized gain of $ 0.8 million).

As of September 30, 2024, the notional value of the Company’s outstanding foreign currency forward contracts was $ 31.8 million (December 31, 2023 — $ 40.6 million).

As of March 31, 2025, the net unrealized loss on the Company’s outstanding foreign currency forward contracts was $ 1.4 million, representing the amount by which the notional value of these forward contracts exceeded their fair value (December 31, 2024 — net unrealized loss of $ 2.0 million).

As of March 31, 2025, the notional value of the Company’s outstanding foreign currency forward contracts was $ 53.8 million (December 31, 2024 — $ 48.4 million).

Bank of China Facility

In June 2022, IMAX (Shanghai) Multimedia Technology Co., Ltd.

(“IMAX Shanghai”), one of the Company’s majority-owned subsidiaries in China, renewed its unsecured revolving facility with Bank of China for up to 200.0 million Chinese Renminbi (“RMB”) ($ 28.5 million), including RMB 10.0 million ($ 1.4 million) for letters of guarantee, to fund ongoing working capital requirements (the “Bank of China Facility”).

The Bank of China Facility expired in September 2023, and has been renewed to February 21, 2025.

As of September 30, 2024, and December 31, 2023, there were no borrowings outstanding under the Bank of China Facility and outstanding letters of guarantee were RMB 0.2 million (less than $ 0.1 million).

As of September 30, 2024, the amount available for future borrowings under the Bank of China Facility was RMB 190.0 million ($ 27.1 million) and the amount available for letters of guarantee was RMB 9.8 million ($ 1.4 million).

As of March 31, 2025, and December 31, 2024, there were no borrowings outstanding under the Bank of China Facility (as defined and described in Note 13 to the Company’s audited Consolidated Financial Statements in its 2024 Form 10-K) and outstanding letters of guarantee were RMB 0.2 million (less than $ 0.1 million).

As of March 31, 2025, the amount available for future borrowings under the Bank of China Facility was RMB 190.0 million ($ 26.5 million) and the amount available for letters of guarantee was RMB 9.8 million ($ 1.4 million).

The amount available for future borrowings under the Bank of China Facility is not subject to a standby fee.

The effective interest rate for the three and nine months ended September 30, 2024 was 0 %, respectively (2023 — 3.85 %, respectively).

The effective interest rate for the three months ended March 31, 2025 was 0 % (2024 — 0 %).

There were no amounts drawn under the Bank of China Facility during the three months ended March 31, 2025.

The Bank of China Facility has been renewed to March 20, 2026.

HSBC China Facility

In June 2022, IMAX Shanghai entered into an unsecured revolving facility for up to RMB 200.0 million ($ 28.5 million) with HSBC Bank (China) Company Limited, Shanghai Branch to fund ongoing working capital requirements (the “HSBC China Facility”).

As of September 30, 2024 and December 31, 2023, no borrowings were outstanding under the HSBC China Facility.

As of September 30, 2024, the amount available for future borrowings under the HSBC China Facility was RMB 200.0 million ($ 28.5 million).

The effective interest rate for the three and nine months ended September 30, 2024 was 0 % (2023 — 3.88 %).

In October 2019, the Company entered into a $ 5.0 million facility with National Bank of Canada (the “NBC Facility”) fully insured by Export Development Canada for use solely in conjunction with the issuance of performance guarantees and letters of credit.

On August 21, 2024, the Company renewed the NBC Facility to August 21, 2025.

The NBC Facility is renewable on the same terms and conditions on an annual basis.

The Company did not have any letters of credit or advance payment guarantees outstanding as of September 30, 2024 and December 31, 2023 under the NBC Facility.

As of March 31, 2025, and December 31, 2024, no borrowings were outstanding under the HSBC China Facility (as defined and described in Note 13 to the Company’s audited Consolidated Financial Statements in its 2024 Form 10-K).

As of March 31, 2025, and December 31, 2024 the amount available for future borrowings under the HSBC China Facility was RMB 200.0 million ($ 27.9 million).

The effective interest rate for the three months ended March 31, 2025 was 0 % (December 2024 — 0 %).

The NBC Facility has been renewed to September 20, 2025.

The Company did not have any letters of credit or advance payment guarantees outstanding as of March 31, 2025 and December 31, 2024 under the NBC Facility (as defined and described in Note 13 to the Company’s audited Consolidated Financial Statements in its 2024 Form 10-K).

Convertible Notes and Other Borrowings, Net

As of September 30, 2024 and December 31, 2023, Convertible Notes and Other Borrowings, Net includes the following:

September 30, December 31,

As of March 31, 2025 and December 31, 2024, Convertible Notes and Other Borrowings, Net included the following:

March 31, December 31,

(In thousands of U.S.

12 unchanged sentences

Convertible Notes

On March 19, 2021, the Company issued $ 230.0 million of 0.500 % Convertible Senior Notes due 2026 (the “Convertible Notes”) in a private placement conducted pursuant to Rule 144A under the Securities Act of 1933, as amended.

The net proceeds from the issuance of the Convertible Notes were $ 223.7 million, after deducting the initial purchasers’ discounts and commissions.

On March 19, 2021, the Company issued $ 230.0 million of 0.500 % Convertible Senior Notes due 2026 (the “Convertible Notes”).

The Convertible Notes are senior unsecured obligations of the Company and bear interest at a rate of 0.500 % per annum on the principal of $ 230.0 million, payable semi-annually in arrears on April 1 and October 1 of each year, beginning on October 1, 2021.

The Convertible Notes will mature on April 1, 2026, unless they are redeemed or repurchased by the Company or converted on an earlier date.

Holders of the Convertible Notes have the right to convert their Convertible Notes in certain circumstances and during specified periods.

Before January 1, 2026, holders of the Convertible Notes have the right to convert their Convertible Notes only upon the occurrence of certain events.

From and after January 1, 2026, holders of the Convertible Notes may convert their Convertible Notes at any time at their election until the close of business on the second scheduled trading day immediately before the maturity date.

Upon conversion, the Company will pay or deliver, as applicable, cash or a combination of cash (in an amount no less than the principal amount of the Convertible Notes being converted) and common shares, at its election, based on the applicable conversion rates.

The initial conversion rate is 34.7766 common shares per $1,000 principal amount of Convertible Notes, which represents an initial conversion price of approximately $ 28.75 per common share, and is subject to adjustment upon the occurrence of certain events.

The Convertible Notes are redeemable, in whole or in part, at the Company’s option at any time, and from time to time, on or after April 6, 2024 and on or before the 40th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the Convertible Notes to be redeemed, plus accrued and unpaid interest, if any, but only if the last reported sale price per share of the Company’s common stock exceeds 130 % of the conversion price for a specified period of time.

In addition, calling any Convertible Notes for redemption will constitute a “make-whole fundamental change” with respect to such notes, in which case the conversion rate applicable to the conversion of such notes will be increased in certain circumstances if such notes are converted after they are called for redemption.

In connection with the pricing of the Convertible Notes, the Company entered into privately negotiated capped call transactions (the “Capped Call Transactions”) with certain financial institutions.

The Capped Call Transactions are expected to reduce potential dilution resulting from the common shares the Company is required to issue and/or to offset any potential cash payments the Company is required to make in excess of the principal amount of the Convertible Notes in the event that the market price per share of the Company’s common shares is greater than the strike price of the Capped Call Transactions with such reduction and/or offset subject to a cap.

The Capped Call Transactions have an initial cap price of $ 37.2750 per share of the Company’s common shares, which represents a premium of 75 % over the last reported sale price of the common shares when they were priced on March 16, 2021, and are subject to certain adjustments under the terms of the Capped Call Transactions.

Collectively, the Capped Call Transactions cover, subject to anti-dilution adjustments substantially similar to those applicable to the Convertible Notes, the number of the Company’s common shares underlying the Convertible Notes.

The cost of the Capped Call Transactions was approximately $ 19.1 million.

The Capped Call Transactions are separate transactions, are not part of the terms of the Convertible Notes and will not affect any holder’s rights under the Convertible Notes.

Holders of the Convertible Notes will not have any rights with respect to the Capped Call Transactions.

The Capped Call Transactions meet all of the applicable criteria for equity classification in accordance with ASC 815-10-15-74(a), “Derivatives and Hedging — Embedded Derivatives — Certain Contracts Involving an Entity’s Own Equity,” and, as a result, the related $ 19.1 million cost was recorded as a reduction to Other Equity within Shareholders’ Equity on the Company’s Condensed Consolidated Statements of Shareholders’ Equity and Consolidated Balance Sheets.

In addition, upon the occurrence of a “fundamental change” (as defined below), holders may require the Company to repurchase their Convertible Notes at a cash repurchase price equal to the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest, if any.

Subject to the terms and conditions of the indenture governing the Convertible Notes, a “fundamental change” means, among other things, an event resulting in (i) a change of control, (ii) a transfer of all or substantially all of the assets of the Company, (iii) a merger, (iv) liquidation or dissolution of the Company, or (v) delisting of the Company’s common shares from a national securities exchange.

The Company continues to record the Convertible Notes entirely as a liability in the Condensed Consolidated Balance Sheets, net of initial purchasers’ discounts and commissions and other debt issuance costs, with interest expense reflecting the cash coupon plus the amortization of the discounts and capitalized costs.

Additionally, under the “if-converted” method, because the principal amount of the Convertible Notes is settled in cash and the conversion spread is settleable in the Company’s common shares, diluted earnings per share is calculated by including the net number of incremental shares that would be issued upon conversion of the Convertible Notes, using the average market price during the period.

Accordingly, the application of the “if-converted” method may reduce the Company’s reported diluted earnings per share.

The Company continues to record the Convertible Notes entirely as a liability on the Condensed Consolidated Balance Sheets, net of initial purchasers’ discounts and commissions and other debt issuance costs, with interest expense reflecting the cash coupon plus the amortization of the discounts and capitalized costs.

Federal Economic Development Loan

The Company’s wholly-owned subsidiary, SSIMWAVE Inc., entered into a contribution agreement with the Federal Economic Development Agency for Southern Ontario (the “Federal Economic Development Loan”) on May 29, 2019, under which SSIMWAVE Inc.

received $ 4.2 million Canadian Dollars ($ 3.2 million) by way of repayable contributions toward certain eligible projects costs.

The contributions under the agreement covered 35 % of the eligible and supported costs of SSIMWAVE between January 10, 2019 and December 31, 2022.

The contributions were repayable over 60 months, with repayments beginning in January 2024 and an annual interest rate of 0 %.

On January 1, 2024, SSIMWAVE Inc.

was amalgamated into the Company.

On January 4, 2024, the Federal Economic Development Loan was assigned to the Company with amendment to the repayment term.

The contributions under the assigned agreement are repayable over 36 months beginning January 2024, with an annual interest rate of 0 %.

The benefit of the interest-free loan has been determined by calculating the present value of the payments using a market-based interest rate and comparing this to the proceeds received.

The benefit is recorded as the interest-free benefit of government funding within Interest Income on the Company’s Condensed Consolidated Statements of Operations.

The obligation is being accreted to its maturity amount, resulting in an interest expense of $ 0.1 million and $ 0.2 million during the three and nine months ended September 30, 2024, respectively, which is being recorded within Interest Expense on the Company’s Condensed Consolidated Statements of Operations.

As of September 30, 2024, the Federal Economic Development Loan has a carrying value of $ 2.3 million, net of unaccreted interest benefit and is recorded within Convertible Notes and Other Borrowings, Net on the Company’s Condensed Consolidated Balance Sheets.

As of March 31, 2025, the Federal Economic Development Loan (as defined and described in Note 13 to the Company’s audited Consolidated Financial Statements in its 2024 Form 10-K) had a carrying value of $ 1.6 million, net of unaccreted interest benefit and is recorded within Convertible Notes and Other Borrowings, Net on the Company’s Condensed Consolidated Balance Sheets.

Commitments, Contingencies and Guarantees

16 unchanged sentences

On March 29, 2017, the Company filed an Execution Application in the Bombay High Court seeking to enforce the ICC award against E-City and several related parties.

On October 24, 2024, the Bombay High Court announced dismissal of the Company’s application, indicating that a written order will follow.

To date, the Company has not received such order, and it fully intends to continue pursuing its rights and seeking to enforce the arbitration award.

On October 24, 2024, the Bombay High Court announced the dismissal of the Company’s application, and the Court issued a written order of dismissal on November 14, 2024.

On December 13, 2024, the Company filed an appeal of this order, and the Company fully intends to continue pursuing its rights and seeking to enforce the arbitration award.

The Company has also taken steps to enforce the ICC final award outside of India.

In December 2011, the Ontario Superior Court of Justice issued an order recognizing the final award and requiring E-City to pay the Company $ 30,000 to cover the costs of the application, and in May 2012, the New York Supreme Court recognized the Canadian judgment and entered it as a New York judgment.

(ii) In addition to the matters described above, the Company is currently involved in other legal proceedings or governmental inquiries which, in the opinion of the Company’s management, will not materially affect the Company’s financial position or future operating results, although no assurance can be given with respect to the ultimate outcome of any such proceedings.

(iii) In the normal course of business, the Company enters into agreements that may contain features that meet the definition of a guarantee.

A guarantee is a contract (including an indemnity) that contingently requires the Company to make payments (either in cash, financial instruments, other assets, shares of its stock, or provision of services) to a third party based on (a) changes in an underlying interest rate, foreign exchange rate, equity or commodity instrument, index or other variable, that is related to an asset, a liability or an equity security of the counterparty, (b) failure of another party to perform under an obligating agreement or (c) failure of another third party to pay its indebtedness when due.

No amounts have been recognized in connection with this matter.

Financial Guarantees

1 unchanged sentence

Product Warranties

The Company’s accrual for product warranties, which is recorded within Accrued and Other Liabilities in the Condensed Consolidated Balance Sheets, was less than $ 0.1 million as of September 30, 2024 and December 31, 2023, respectively.

The Company’s accrual for product warranties, which is recorded within Accrued and Other Liabilities on the Condensed Consolidated Balance Sheets, was $ 0.1 million as of March 31, 2025 and December 31, 2024, respectively.

Director and Officer Indemnifications

3 unchanged sentences

The Company has purchased directors’ and officers’ liability insurance.

No amount has been accrued in the Company’s Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023, with respect to this indemnity.

No amount has been accrued on the Company’s Condensed Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024, with respect to this indemnity.

Other Indemnification Agreements

12 unchanged sentences

Selling Expenses

The following table summarizes the Company’s selling expenses, including sales commissions and marketing and other, which are recognized within Costs and Expenses Applicable to Revenues in the Condensed Consolidated Statements of Operations, for three and nine months ended September 30, 2024 and 2023:

Three Months Ended September 30,

(In thousands of U.S.

Commissions Marketing

and Other Sales

Technology sales (1)

$ 258 $ 139 $ 301 $ 347

Image enhancement and maintenance services (2)

— 5,172 — 2,744

Technology rentals (3)

128 811 38 469

Total $ 386 $ 6,122 $ 339 $ 3,560

(1) Sales commissions paid prior to the recognition of the related revenue are deferred and recognized upon the client acceptance of the IMAX System.

Direct advertising and marketing costs for each IMAX System are expensed as incurred.

(2) Film exploitation costs, including advertising and marketing costs, are expensed as incurred.

(3) Sales commissions related to joint revenue sharing arrangements accounted for as operating leases are recognized in the month they are earned by the salesperson, which is typically the month in which the IMAX System is installed, and are subject to subsequent performance-based adjustments.

Direct advertising and marketing costs for each IMAX System are expensed as incurred.

Nine Months Ended September 30,

Three Months Ended March 31,

(In thousands of U.S.

14 unchanged sentences

Foreign Exchange

Included in Selling, General and Administrative Expenses for the three and nine months ended September 30, 2024 are foreign currency net losses of $ 0.3 million and $ 0.8 million, respectively (2023 — net losses of $ 0.2 million and $ 0.8 million, respectively) resulting from changes in exchange rates related to foreign currency denominated monetary assets and liabilities.

See Note 15 for additional information.

Included in Selling, General and Administrative Expenses for the three months ended March 31, 2025 are foreign currency net loss of $ 0.4 million (2024 — net loss of $ 0.3 million), resulting from changes in exchange rates related to foreign currency denominated monetary assets and liabilities.

(Refer to “Financial Instruments — Foreign Exchange Risk Management ” in Note 15 for additional information.)

Collaborative Arrangements

Joint Revenue Sharing Arrangements

The accounting policy for the Company’s joint revenue sharing arrangements is disclosed in Note 2(o) of the Company’s audited Consolidated Financial Statements in its 2023 Form 10-K.

Revenue attributable to transactions arising between the Company and its customers under joint revenue sharing arrangements are recorded within Revenues — Technology Sales (for hybrid joint revenue sharing arrangements) and Revenues — Technology Rentals (for traditional joint revenue sharing arrangements).

For the three and nine months ended September 30, 2024, such revenues totaled $ 15.9 million and $ 48.4 million, respectively (2023 — $ 23.1 million and $ 63.8 million, respectively).

The accounting policy for the Company’s JRSAs is disclosed in Note 2 of the Company’s audited Consolidated Financial Statements in its 2024 Form 10-K.

Revenue attributable to transactions arising between the Company and its customers under JRSAs are recorded within Revenues — Technology Sales (for hybrid JRSAs) and Revenues — Technology Rentals (for traditional JRSAs).

For the three months ended March 31, 2025, such revenues totaled $ 19.2 million (2024 — $ 19.3 million).

IMAX Film Remastering and Distribution

In an IMAX Film Remastering and distribution arrangement, the Company receives a percentage of the box office receipts from a third party who owns the copyright to a film in exchange for converting the film into IMAX format and distributing it through the IMAX network.

The fee earned by the Company in a typical IMAX Film Remastering and distribution arrangement averages approximately 12.5 % of box office receipts (i.e.

gross box office receipts less applicable sales taxes), except for within mainland China, where the Company receives a lower percentage of net box office receipts for certain Hollywood films.

The accounting policy for the Company’s Film Remastering and distribution arrangements is disclosed in Note 2(o) of the Company’s audited Consolidated Financial Statements in its 2023 Form 10-K.

The Company earns revenue through the digital remastering of films and other content into IMAX formats for distribution to the IMAX network (“IMAX Film Remastering”).

The accounting policy for IMAX Film Remastering and distribution arrangements is disclosed in Note 2 of the Company’s audited Consolidated Financial Statements in its 2024 Form 10-K.

Revenue attributable to transactions arising between the Company and its customers under IMAX Film Remastering and distribution arrangements are included in Revenues – Image Enhancement and Maintenance Services.

For the three and nine months ended September 30, 2024, such revenues totaled $ 26.7 million and $ 77.7 million, respectively (2023 — $ 42.5 million and $ 101.8 million, respectively).

See Note 12 for a disaggregated presentation of the Company’s revenues.

For the three months ended March 31, 2025, such revenues totaled $ 31.8 million (2024 — $ 29.7 million).

(Refer to “Revenue from Contracts with Customers — Disaggregated Information About Revenue ” in Note 12 for a disaggregated presentation of the Company’s revenues.)

Co-Produced Film Arrangements

In certain film arrangements, the Company co-produces a film with a third party whereby the third party retains the copyright and certain other rights to the film.

In some cases, the Company obtains exclusive theatrical distribution rights to the film.

Under these arrangements, both parties contribute to the funding of the production, distribution and exploitation costs associated with the film.

As of September 30, 2024, the Company is party to one co-produced film arrangement, which represents the VIE total assets balance of $ 1.4 million and liabilities balance of $ 0.2 million, and five other co-produced film arrangements, the terms of which are similar.

The accounting policies relating to co-produced film arrangements are disclosed in Notes 2(a) and 3(o) of the Company’s audited Consolidated Financial Statements in its 2023 Form 10-K.

For the three and nine months ended September 30, 2024, an expense of $ 0.2 million and $ 3.2 million, respectively (2023 — $ 0.2 million and $ 0.5 million, respectively) attributable to transactions between the Company and other parties involved in the production of the films have been included in Costs and Expenses Applicable to Revenues ― Image Enhancement and Maintenance Services.

The accounting policies relating to co-produced film arrangements are disclosed in Notes 2 and 3 of the Company’s audited Consolidated Financial Statements in its 2024 Form 10-K.

As of March 31, 2025, the Company is party to one co-produced film arrangement, which represented the VIE total assets balance of $ 1.6 million and liabilities balance of $ 0.2 million, and four other co-produced film arrangements, the terms of which are similar.

For the three months ended March 31, 2025, an expense of $ 0.1 million (2024 — $ 0.1 million) attributable to transactions between the Company and other parties involved in the production of the films has been included in Costs and Expenses Applicable to Revenues ― Image Enhancement and Maintenance Services.

Condensed Consolidated Statements of Cash Flows – Supplemental Information

Changes in other operating assets and liabilities

Nine Months Ended

September 30,

Three Months Ended

(In thousands of U.S.

6 unchanged sentences

( 413 ) ( 168 )

( 2,026 ) ( 4,615 )

(Decrease) increase in:

Increase (decrease) in:

Accounts payable

4 unchanged sentences

Depreciation and amortization

Nine Months Ended

September 30,

Three Months Ended

(In thousands of U.S.

1 unchanged sentence

Property, plant and equipment:

Equipment supporting joint revenue sharing arrangements

17,011 17,228

Equipment supporting JRSAs

Other property, plant and equipment

Other intangible assets

Other assets (3)

Total $ 14,913 $ 15,164

(1) Includes the amortization of laser projection systems, camera, and lens upgrades recorded in Research and Development on the Condensed Consolidated Statements of Operations of $ 0.4 million in the nine months ended September 30, 2024 (2023 — $ 0.4 million).

(2) Includes the amortization of licenses and intellectual property recorded in Research and Development on the Condensed Consolidated Statements of Operations of $ 1.0 million in the nine months ended September 30, 2024 (2023 — $ 1.0 million).

(3) Includes the amortization of lessee incentives provided by the Company to its customers under joint revenue sharing arrangements.

Nine Months Ended

September 30,

Three Months Ended

(In thousands of U.S.

1 unchanged sentence

Property, plant and equipment:

Equipment supporting joint revenue sharing arrangements (1)

Equipment supporting JRSAs

Other property, plant and equipment

Other intangible assets

$ 3,034 $ 872

(1) For the nine months ended September 30, 2024, the Company recorded charges of $ 2.7 million (2023 ― $ 0.5 million) in Costs and Expenses Applicable to Revenues ― Technology Rentals mostly related to the write-down of systems under joint revenue sharing arrangements resulting from contract amendments, as well as the permanent closure of one IMAX System.

Significant non-cash investing activities

Nine Months Ended

September 30,

Three Months Ended

(In thousands of U.S.

Net increase (decrease) in accruals related to:

Investment in equipment supporting joint revenue sharing arrangements

Investment in equipment supporting JRSAs

$ 1,134 $ ( 469 )

4 unchanged sentences

Income Tax Expense

For the three months ended September 30, 2024, the Company recorded an income tax expense of $ 2.4 million (2023 — tax expense of $ 6.6 million).

The Company’s effective tax rate of 13.4 % for the three months ended September 30, 2024 differs from the Canadian statutory rate of 26.5% primarily due to tax rate differences in foreign jurisdictions and a decrease in the valuation allowance, which was partially offset by an increase in tax reserves, tax return adjustments and withholding taxes.

The Company’s effective tax rate of 30.4 % for the three months ended September 30, 2023 differs from the Canadian statutory rate of 26.5% primarily due to tax rate differences in foreign jurisdictions, which was offset by an increase in the valuation allowance, tax return adjustments and withholding taxes.

For the nine months ended September 30, 2024, the Company recorded an income tax expense of $ 3.5 million (2023 — tax expense of $ 14.9 million).

The Company’s effective tax rate of 12.0 % for the nine months ended September 30, 2024 differs from the Canadian statutory rate of 26.5% primarily due to tax rate differences in foreign jurisdictions and a tax benefit related to an internal asset sale during the second quarter which was partially offset by an increase in the valuation allowance, tax reserves, tax return adjustments, withholding taxes and a shortfall in tax benefits related to share-based compensation.

The Company’s effective tax rate of 33.4 % for the nine months ended September 30, 2023 differs from the Canadian statutory rate of 26.5% primarily due to tax rate differences in foreign jurisdictions which was offset by an increase in the valuation allowance, tax return adjustments and withholding taxes.

In the nine months ended September 30, 2024, the Company completed an internal asset sale to more closely align its intellectual property ownership with its operations.

In order to effect this internal asset sale, transactions between entities within the group resulted in capital gains for tax purposes.

The tax expense related to the capital gain was partially offset by the reversal of the valuation allowance.

Net deferred tax assets were also recorded on the transaction, resulting in a net tax benefit of $ 7.7 million.

As of September 30, 2024, the Company’s Condensed Consolidated Balance Sheets includes net deferred income tax assets of $ 15.7 million (December 31, 2023 — $ 8.0 million).

For the three months ended March 31, 2025, the Company recorded an income tax expense of $ 7.3 million (2024 — income tax expense of $ 5.2 million).

The Company’s effective tax rate of 47.2 % for the three months ended March 31, 2025 reflects the geographic allocation of income earned in taxing jurisdictions and also reflects an increase in the valuation allowance, withholding taxes and a tax benefit related to share-based compensation.

The Company’s effective tax rate of 48.8 % for the three months ended March 31, 2024 reflects the geographic allocation of income earned in taxing jurisdictions and also reflects an increase in the valuation allowance, withholding taxes and a tax expense related to share-based compensation.

As of March 31, 2025, the Company’s Condensed Consolidated Balance Sheets included net deferred income tax assets of $ 14.4 million (December 31, 2024 — $ 14.5 million).

Realization of net deferred tax assets is dependent upon generation of sufficient taxable income in future years to obtain benefit from the reversal of temporary differences, net operating loss carryforwards and tax credit carryforwards.

The amount of net deferred tax assets considered realizable is subject to adjustment in future periods if estimates of future taxable income change.

As of September 30, 2024, the Company’s Condensed Consolidated Balance Sheets also include deferred tax liabilities of $ 12.5 million (December 31, 2023 — $ 12.5 million) primarily related to foreign withholding taxes associated with the remaining balance of non-repatriated historical earnings that will not be indefinitely reinvested outside of Canada.

Share Buyback Tax

Legislation to introduce a 2% tax on the value of certain share buybacks net of share issuances by publicly traded Canadian-resident corporations was enacted during the second quarter of 2024.

The tax applies to net share repurchases on or after January 1, 2024, with certain exceptions.

The tax is imposed on the repurchasing corporation itself and will be included in the cost basis of the repurchased treasury stock.

The Company has recorded a tax liability in the amount of $ 0.1 million at September 30, 2024.

As of March 31, 2025, the Company’s Condensed Consolidated Balance Sheets also included deferred tax liabilities of $ 12.5 million (December 31, 2024 — $ 12.5 million) primarily related to foreign withholding taxes associated with the remaining balance of non-repatriated historical earnings that will not be indefinitely reinvested outside of Canada.

Capital Stock and Reserves

Share-Based Compensation

For the three and nine months ended September 30, 2024, share-based compensation expense totaled $ 5.4 million and $ 16.9 million, respectively (2023 — $ 5.2 million and $ 17.1 million, respectively) and is reflected in the following accounts in the Condensed Consolidated Statements of Operations:

Three Months Ended Nine Months Ended

September 30, September 30,

For the three months ended March 31, 2025, share-based compensation expense totaled $ 5.2 million (2024 — $ 4.7 million) and is reflected in the following accounts in the Condensed Consolidated Statements of Operations:

Three Months Ended

(In thousands of U.S.

Dollars, except rates)

2024 2023 2024 2023

Costs and expenses applicable to revenues

$ 251 $ 247 $ 726 $ 752

Selling, general and administrative expenses

5,036 4,865 15,879 16,537

Research and development

112 106 333 310

Executive transition costs

— — — ( 499 )

Total $ 5,205 $ 4,676

The following table summarizes the Company’s share-based compensation expense (recovery) by each award type:

Three Months Ended Nine Months Ended

September 30, September 30,

The following table summarizes the Company’s share-based compensation expense by each award type:

Three Months Ended

(In thousands of U.S.

Dollars, except rates)

2024 2023 2024 2023

Stock Options

$ — $ — $ — $ 84

Restricted Share Units

3,111 2,686 9,986 9,880

Performance Stock Units

2,048 1,985 5,866 4,909

IMAX China Stock Options

IMAX China Long Term Incentive Plan Restricted Share Units

297 427 1,019 1,816

IMAX China Long Term Incentive Plan Performance Stock Units

$ 5,205 $ 4,676

$ 5,399 $ 5,218 $ 16,938 $ 17,100

For the three and nine months ended September 30, 2024, the Company’s share-based compensation expense includes $ 0.1 million and $ 1.8 million related to restricted share units granted to non-employees (2023 — $ nil and $ 1.7 million, respectively).

For the three months ended March 31, 2025, the Company’s share-based compensation expense included restricted share units to non-employees of less than $ 0.1 million that were granted and have not yet vested (2024 — less than $ 0.1 million, which vested immediately upon granting).

Stock Option Summary

The following table summarizes the activity under the Company’s Stock Option Plan (“SOP”) and the IMAX Corporation Second Amended and Restated Long-Term Incentive Plan (as may be amended, “IMAX LTIP”) for the nine months ended September 30, 2024 and 2023:

The following table summarizes the activity under the Company’s Stock Option Plan (“SOP”) for the three months ended March 31, 2025 and 2024:

Number of Shares Weighted Average Exercise

5 unchanged sentences

Expired ( 470,582 ) ( 607,114 ) 29.53 28.15

Cancelled ( 1,768 ) — 24.38 —

Stock options outstanding, end of period

2 unchanged sentences

1,954,625 2,722,308 25.59 25.80

Stock options are no longer granted under the Company’s previously approved SOP.

IMAX LTIP Restricted Share Units (“RSU”) Summary

The following table summarizes the activity in respect of RSUs issued under the IMAX LTIP for the nine months ended September 30, 2024 and 2023:

The following table summarizes the activity in respect of RSUs issued under the IMAX Corporation Second Amended and Restated Long-Term Incentive Plan (as may be amended, “IMAX LTIP”) for the three months ended March 31, 2025 and 2024:

Number of Shares Weighted Average Grant Date

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The Company grants two types of PSU awards, one which vests based on a combination of employee service and the achievement of certain Adjusted EBITDA targets and one which vests based on a combination of employee service and the achievement of total shareholder return (“TSR”) targets.

The achievement of the Adjusted EBITDA and TSR targets in these PSUs is determined over a three-year performance period.

At the conclusion of the three-year performance period, the number of PSUs that ultimately vest can range from 0 % to a maximum vesting opportunity of 175 % of the initial Adjusted EBITDA PSU award or 175 % of the initial TSR PSU award for awards issued in 2022 and 150 % of the initial TSR PSU award for awards issued in 2023 and thereafter, depending upon actual performance versus the established Adjusted EBITDA and TSR targets, respectively.

The achievement of these targets are assessed over a three-year performance period.

At the conclusion of the three-year performance period, the number of PSUs that ultimately vest can range from 0 % to a maximum vesting opportunity of 175 % of the initial Adjusted EBITDA PSU award or 150 % of the initial TSR PSU award, depending upon actual performance versus the established Adjusted EBITDA and TSR targets, respectively.

The grant date fair value of PSUs with Adjusted EBITDA targets is equal to the closing price of the Company’s common shares on the date of grant or the average closing price of the Company’s common shares for five days prior to the date of grant.

7 unchanged sentences

Conversely, if, as a result of management’s assessment, it is projected that a lower number of PSUs will vest than previously anticipated, a life-to-date adjustment to decrease compensation expense is recorded in the period that such determination is made.

The expense recognized in the nine months ended September 30, 2024 and 2023 includes adjustments reflecting management’s estimate of the number of Adjusted EBITDA PSUs expected to vest.

The following table summarizes the activity in respect of PSUs issued under the IMAX LTIP for the nine months ended September 30, 2024 and 2023:

The expense recognized in the three months ended March 31, 2025 and 2024 includes adjustments reflecting management’s estimate of the number of Adjusted EBITDA PSUs expected to vest.

The following table summarizes the activity in respect of PSUs issued under the IMAX LTIP for the three months ended March 31, 2025 and 2024:

Number of Awards Weighted Average Grant Date

6 unchanged sentences

( 463,212 ) ( 316,226 ) 19.88 19.71

Forfeited (2)

( 3,043 ) ( 78,489 ) 18.48 21.28

1 unchanged sentence

1,182,463 1,106,761 20.13 18.32

(1) For the nine months ended September 30, 2024, the balance of shares granted includes 135,511 additional shares, at a weighted average grant date fair value per share of $ 19.71 , as PSUs granted in 2021 with Adjusted EBITDA targets vested at 175 % on account of full achievement of the targets.

(2) Forfeited PSUs include the TSR target awards issued in 2021 which did not vest as the market condition was not satisfied.

Since the grant date, the Company recorded an expense of $ 1.5 million associated with these 68,850 shares which, despite the awards not vesting, will not be reversed into income.

As of September 30, 2024, the maximum number of common shares that may be issued with respect to PSUs outstanding is 1,876,792 , assuming full achievement of the Adjusted EBITDA and TSR targets.

(1) For the three months ended March 31, 2025, the balance of shares granted includes 176,751 additional shares, at a weighted average grant date fair value per share of $ 19.53 , as PSUs granted in 2022 with Adjusted EBITDA targets vested at 175 % and TSR targets vested at 123.5 %, which reflects actual performance versus established targets.

As of March 31, 2025, the maximum number of common shares that may be issued with respect to PSUs outstanding was 1,983,624 , assuming full achievement of the Adjusted EBITDA and TSR targets.

Issuer Purchases of Equity Securities

On June 12, 2017, the Company announced that its Board of Directors approved a $ 200.0 million share repurchase program for its common shares that would have expired on June 30, 2020, which was subsequently extended for a 12-month period in 2020, 2021, and 2023 and increased the total share repurchase authority to $ 400.0 million.

In 2023, the Company’s Board of Directors approved a 36-month extension to its share repurchase program through June 30, 2026.

As of September 30, 2024, the Company has $ 150.7 million available under the program.

On June 12, 2017, the Company announced that its Board of Directors approved a $ 200.0 million share repurchase program for its common shares that would have expired on June 30, 2020, which was subsequently extended through June 30, 2026 and increased to a total share repurchase authority of $ 400.0 million.

As of March 31, 2025, the Company had $ 150.7 million available under the program.

The repurchases may be made either in the open market or through private transactions, including repurchases made pursuant to a plan intended to comply with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, subject to market conditions, applicable legal requirements, and other relevant factors.

The Company has no obligation to repurchase shares and the share repurchase program may be suspended or discontinued by the Company at any time.

During the three months ended September 30, 2024, the Company did no t have any repurchases of common shares.

During the nine months ended September 30, 2024, the Company repurchased 1,166,370 common shares at an average price of $ 13.99 per share, for a total of $ 16.3 million, excluding commissions.

During the three and nine months ended September 30, 2023, the Company repurchased 13,981 and 144,482 common shares, respectively, at an average price of $ 18.00 and $ 15.47 per share, for a total of $ 0.3 million and $ 2.2 million, respectively, excluding commissions.

The repurchases for the nine months ended September 30, 2024 excludes repurchases of 108,393 shares, at an average price of $ 14.98 for a total of $ 1.6 million with trade dates in December 2023 (2023 — 140,000 shares at an average price of $ 14.45 , for a total of $ 2.0 million, with trade dates in December 2022).

During the nine months ended September 30, 2024 and 2023, there were no shares purchases in the administration of employee share-based plans.

As of September 30, 2024 and December 31, 2023, the IMAX LTIP trustee did not hold any shares.

During the three months ended March 31, 2025, the Company did not repurchase any common shares.

During the three months ended March 31, 2024, the Company repurchased 1,158,724 common shares at an average price of $ 13.99 per share, for a total of $ 16.2 million, excluding commissions.

The repurchases for the three months ended March 31, 2024 excludes repurchases of 108,393 shares for a total of $ 1.6 million with trade dates in December 2023.

During the three months ended March 31, 2025 and 2024, there were no shares purchased in the administration of employee share based plans.

As of March 31, 2025 and December 31, 2024, the IMAX LTIP trustee did not hold any shares.

Any shares held with the trustee are recorded at cost and are reported as a reduction against Capital Stock on the Company’s Condensed Consolidated Balance Sheets.

In 2023, IMAX China’s shareholders granted its Board of Directors a general mandate authorizing the Board, subject to applicable laws, to repurchase shares of IMAX China not to exceed 10 % of the total number of issued shares as of June 7, 2023 ( 33,959,314 shares).

In 2023, IMAX China’s shareholders granted its Board of Directors a general mandate authorizing IMAX China’s Board of Directors, subject to applicable laws, to repurchase shares of IMAX China not to exceed 10 % of the total number of issued shares as of June 7, 2023 ( 33,959,314 shares).

This program expired on the date of the 2024 Annual General Meeting of IMAX China on June 7, 2024.

3 unchanged sentences

IMAX China has no obligation to repurchase its shares and the share repurchase program may be suspended or discontinued by IMAX China at any time.

During the three months ended September 30, 2024, IMAX China did no t have any repurchases of common shares.

During the nine months ended September 30, 2024, IMAX China repurchased 119,900 common shares, at an average price of HKD 7.43 per share ($ 0.95 per share) for a total of HKD 0.9 million ($ 0.1 million).

IMAX China did no t have any repurchases during the three and nine months ended September 30, 2023.

The change in the non-controlling interest attributable to IMAX China as a result of common shares repurchased is recorded as a reduction to Non-Controlling Interests in the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Shareholders’ Equity.

The difference between the consideration paid and the ownership interest obtained as a result of IMAX China share repurchases is recorded within Other Equity in the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Shareholders’ Equity.

During the three months ended March 31, 2025 and 2024, IMAX China did not repurchase any of its common shares.

Basic and Diluted Weighted Average Shares Outstanding

The following table reconciles the denominator of the basic and diluted weighted average share computations:

Three Months Ended Nine Months Ended

September 30, September 30,

Three Months Ended

(In thousands) 2025 2024

2 unchanged sentences

Weighted average number of shares issued (repurchased), net

5 ( 2 ) ( 655 ) 275

Weighted average number of shares outstanding - basic

1 unchanged sentence

Weighted average effect of potential common shares, if dilutive

1,407 917 1,023 837

Weighted average number of shares outstanding - diluted

54,969 53,406

For the three and nine months ended September 30, 2024, the calculation of diluted weighted average shares outstanding excludes 2,192,874 and 2,769,499 shares, respectively (2023 — 3,395,488 and 3,398,228 shares, respectively) that are issuable upon the vesting or exercise of share-based compensation including:

(i) nil and 10,798 RSUs, respectively (2023 — 29,702 and 32,442 RSUs, respectively), (ii) nil and 42,848 PSUs, respectively (2023 — 36,364 PSUs, respectively) and (iii) 2,192,874 and 2,715,853 stock options, respectively (2023 — 3,329,422 stock options, respectively), as the effect would be anti-dilutive.

The calculation of diluted weighted average shares outstanding for the three and nine months ended September 30, 2024 and 2023 also excludes any shares potentially issuable upon the conversion of the Convertible Notes as the average market price of the Company’s common shares during the period of time they were outstanding was less than the conversion price of the Convertible Notes.

For the three months ended March 31, 2025, the calculation of diluted weighted average shares outstanding excludes 971,374 shares (2024 — 3,824,411 shares) that are issuable upon the vesting or exercise of share-based compensation including:

(i) nil RSUs (2024 — 729,150 RSUs), (ii) 128,333 PSUs (2024 — 372,953 PSUs) and (iii) 843,041 stock options (2024 — 2,722,308 stock options), as the effect would be anti-dilutive.

The calculation of diluted weighted average shares outstanding for the three months ended March 31, 2025 and 2024 also excludes any shares potentially issuable upon the conversion of the Convertible Notes as the average market price of the Company’s common shares during the period of time they were outstanding was less than the conversion price of the Convertible Notes.

Statutory Surplus Reserve

Pursuant to the corporate law of the PRC, entities registered in the PRC are required to maintain certain statutory reserves, which are appropriated from after-tax profits (after offsetting accumulated losses from prior years), as reported in their respective statutory financial statements, before the declaration or payment of dividends to equity holders.

financial statements, before the declaration or payment of dividends to equity holders.

All statutory reserves are created for specific purposes.

The Company’s PRC subsidiaries are required to appropriate 10 % of statutory net profits to statutory surplus reserves, upon distribution of their after-tax profits.

The Company’s PRC subsidiaries may discontinue the contribution when the when the aggregate sum of the statutory surplus reserve is more than 50 % of their registered capital.

The statutory surplus reserve is non-distributable other than during liquidation and may only be used to fund losses from prior years, to expand production operations, or to increase the capital of the subsidiaries.

In addition, the subsidiaries may make further contribution to the discretional surplus reserve using post-tax profits in accordance with resolutions of the Board of Directors.

The statutory surplus reserve of RMB 36.4 million ($ 5.6 million) has reached 50 % of the Company’s PRC subsidiaries’ registered capital, as such no further contributions to the reserve are required.

The statutory surplus reserve of RMB 37.0 million ($ 5.8 million) has reached 50 % of the Company’s PRC subsidiaries’ registered capital, and as such, no further contributions to the reserve are required.

Revenue from Contracts with Customers

Disaggregated Information About Revenue

The following tables summarize the Company’s Revenues by reportable segment and revenue stream type for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended September 30, 2024

(In thousands of U.S.

Dollars) Technology Sales

Image Enhancement and Maintenance Services

Technology Rentals

Finance Income

Content Solutions Segment:

Film Remastering and Distribution

$ — $ 26,687 $ — $ — $ 26,687

Other Content Solutions

— 3,356 86 — 3,442

— 30,043 86 — 30,129

Technology Products and Services Segment:

24,365 — — — 24,365

System Rentals

— — 16,029 — 16,029

Maintenance — 15,443 — — 15,443

Finance Income

— — — 2,134 2,134

24,365 15,443 16,029 2,134 57,971

Sub-total for reportable segments

24,365 45,486 16,115 2,134 88,100

1,940 1,405 7 — 3,352

Total $ 26,305 $ 46,891 $ 16,122 $ 2,134 $ 91,452

Nine Months Ended September 30, 2024

The following tables summarize the Company’s Revenues by reportable segment and revenue stream type for the three months ended March 31, 2025 and 2024:

Three Months Ended March 31, 2025

(In thousands of U.S.

21 unchanged sentences

Total $ 13,524 $ 50,753 $ 19,311 $ 3,079 $ 86,667

Three Months Ended September 30, 2023

Three Months Ended March 31, 2024

(In thousands of U.S.

21 unchanged sentences

Total $ 7,904 $ 50,348 $ 18,601 $ 2,270 $ 79,123

Nine Months Ended September 30, 2023

(In thousands of U.S.

Dollars) Technology Sales

Image Enhancement and Maintenance Services

Technology Rentals

Finance Income

Content Solutions Segment

Film Remastering and Distribution $ — $ 101,772 $ — $ — $ 101,772

Other Content Solutions — 5,833 — — 5,833

— 107,605 — — 107,605

Technology Products and Services Segment

System Sales 60,296 — — — 60,296

System Rentals — — 62,612 — 62,612

Maintenance — 42,395 — — 42,395

Finance Income — — — 6,510 6,510

60,296 42,395 62,612 6,510 171,813

Sub-total for reportable segments 60,296 150,000 62,612 6,510 279,418

All Other 5,159 4,244 — — 9,403

Total $ 65,455 $ 154,244 $ 62,612 $ 6,510 $ 288,821

For the three and nine months ended September 30, 2024, revenues earned from Technology Sales include variable consideration of $ 8.2 million and $ 17.6 million, respectively (2023 — $ 4.0 million and $ 21.3 million, respectively).

Variable consideration revenues represent an estimate of the contingent fees that may become due if certain annual minimum box office receipt thresholds are exceeded and are recorded as revenue in the period when the sale is recognized and may be adjusted in future periods based on actual results and changes in estimates over the term of the system agreement.

For the three and nine months ended September 30, 2024, revenues earned from leasing arrangements total $ 15.9 million and $ 48.4 million, respectively (2023 — $ 22.8 million and $ 65.6 million, respectively), including $ 16.0 million and $ 48.5 million, respectively, in Revenues ― Technology Rentals (2023 — $ 23.0 million and $ 62.6 million, respectively), and a reversal of $ 0.1 million in the three and nine months ended September 30, 2024, respectively, in Revenues ― Technology Sales (2023 — revenues of $ 0.2 million and $ 3.4 million, respectively).

For the three months ended March 31, 2025, revenues earned from Technology Sales included variable consideration of $ 3.2 million (2024 — $ 1.7 million).

For the three months ended March 31, 2025, revenues earned from leasing arrangements totaled $ 19.4 million (2024 — $ 19.3 million), including $ 19.3 million in Revenues ― Technology Rentals (2024 — $ 18.6 million), and less than $ 0.1 million in Revenues ― Technology Sales (2024 — $ 0.7 million).

Deferred Revenue

IMAX System sale and lease arrangements include a requirement for the Company to provide maintenance services over the life of the arrangement, some of which are subject to a consumer price index adjustment each year.

IMAX System sale and lease arrangements include a requirement for the Company to provide maintenance services over the life of the arrangement, some of which maintenance services are subject to a consumer price index adjustment each year.

In circumstances where customers prepay the entire term’s maintenance fee based on the original arrangement, additional payments are due to the Company for the years after its extended warranty and maintenance obligations expire.

Payments, upon renewal each year, are either prepaid or made in arrears and can vary in frequency from monthly to annually.

As of September 30, 2024, $ 17.9 million of consideration has been deferred in relation to outstanding maintenance services to be provided on existing maintenance contracts (December 31, 2023 — $ 22.8 million).

Maintenance revenue is recognized evenly over the contract term which coincides with the period over which maintenance services are provided.

In the event of customer default, any payments made by the customer may be retained by the Company.

In instances where the Company receives consideration prior to satisfying its performance obligations, the recognition of revenue is deferred.

The majority of the deferred revenue balance relates to payments received by the Company for IMAX Systems where control of the system has not yet transferred to the customer.

The deferred revenue balance related to an individual IMAX System increases as progress payments are made and is then derecognized when control of the system is transferred to the customer.

Recognition dates are variable and depend on numerous factors, including some outside of the Company’s control.

During the three and nine months ended September 30, 2024, $ 11.5 million and $ 35.7 million of revenue, respectively, was recognized from the $ 67.1 million balance of deferred revenue as of December 31, 2023.

During the three and nine months ended September 30, 2023, $ 18.3 million and $ 59.3 million of revenue, respectively, was recognized from the $ 70.9 million balance of deferred revenue as of December 31, 2022.

As of March 31, 2025, $ 24.3 million of consideration has been deferred in relation to outstanding maintenance services to be provided on existing maintenance contracts (December 31, 2024 — $ 26.5 million).

During the three months ended March 31, 2025, $ 9.0 million of revenue was recognized from the $ 52.7 million balance of deferred revenue as of December 31, 2024.

During the three months ended March 31, 2024, $ 12.1 million of revenue was recognized from the $ 67.1 million balance of deferred revenue as of December 31, 2023.

Segment Reporting

2 unchanged sentences

Selling, general and administrative expenses, research and development costs, the amortization of intangible assets, provision for (reversal of) current expected credit losses, certain write-downs, interest income, interest expense, and income tax (expense) benefit are not allocated to the Company’s segments.

The Company has the following reportable segments:

(i) Content Solutions, which principally includes the digital remastering of films and other content into IMAX formats for distribution to the IMAX network.

To a lesser extent, the Content Solutions segment also earns revenue from the distribution of large-format documentary films and exclusive experiences ranging from live performances to interactive events with leading artists and creators, as well as film post-production services.

(ii) Technology Products and Services, which includes results from the sale or lease of IMAX Systems, as well as from the maintenance of IMAX Systems.

To a lesser extent, the Technology Product and Services segment also earns revenue from certain ancillary theater business activities, including after-market sales of IMAX System parts and 3D glasses.

Transactions between segments are valued at exchange value.

Inter-segment profits are eliminated upon consolidation, as well as for the disclosures below.

The following table presents the Company’s revenue and gross margin by reportable segment for the three months ended September 30, 2024 and 2023:

The accounting policies of the reportable segments are the same as those described in Note 2 - Summary of Significant Accounting Policies of the 2024 Form 10-K.

Intercompany profit or loss is not included in the evaluation of performance and allocation of resources.

Segment Financial Information

The following table presents the Company’s revenue and gross margin by reportable segment for the three months ended March 31, 2025 and 2024:

(In thousands of U.S.

6 unchanged sentences

84,842 77,163 52,640 45,683

All Other (2)

1,825 1,960 536 1,206

Total $ 86,667 $ 79,123 $ 53,176 $ 46,889

(1) The Company’s largest customer represents 13 % of total Revenues for the three months ended September 30, 2024 (2023 — 11 %).

No single customer comprises more than 10% of the Company’s total Accounts Receivable as of September 30, 2024 and December 31, 2023.

(2) All Other includes the results from the Company's streaming and consumer technology business, as well as other ancillary activities.

The following table presents the Company’s revenue and gross margin by reportable segment for the nine months ended September 30, 2024 and 2023:

(1) The Company’s largest customer represented 15 % of total Revenues for the three months ended March 31, 2025 (2024 — 10 %).

No single customer comprised more than 10% of the Company’s total Accounts Receivable as of March 31, 2025 or December 31, 2024.

The following table presents the Costs and Expenses Applicable to Revenues for the Content Solutions segment that is made available to the CODM as part of the Company’s annual and quarterly financial reporting requirements in accordance with U.S.

Content Solutions Segment:

Three Months Ended March 31,

(In thousands of U.S.

Content Solutions

$ 34,249 $ 34,013

Technology Products and Services

Film asset amortization

Marketing and other selling expenses

Co-produced film participation expenses

Other segment expenses (1)

Total Costs and Expenses Applicable to Revenues

10,695 11,914

Sub-total for reportable segments

$ 23,554 $ 22,099

All Other (2)

(1) Included within the Other segment expenses are costs related to film distribution, post production costs, production costs, and network connectivity fees.

The following table presents the Costs and Expenses Applicable to Revenues for the Technology Products and Services reportable segment that is made available to the CODM as part of the Company’s annual and quarterly financial reporting requirements in accordance with U.S.

Technology Products and Services Segment:

Three Months Ended March 31,

(In thousands of U.S.

$ 50,593 $ 43,150

Total $ 259,536 $ 288,821 $ 141,835 $ 170,653

(1) The Company’s largest customer represents 11 % of total Revenues for the nine months ended September 30, 2024 (2023 — 8 %).

No single customer comprises more than 10% of the Company’s total Accounts Receivable as of September 30, 2024 and December 31, 2023.

(2) All Other includes the results from the Company's streaming and consumer technology business, as well as other ancillary activities.

Depreciation of equipment supporting JRSAs

Marketing and other selling expenses

Write-down of equipment supporting JRSAs

Write-down of inventory

Other segment expenses (1)

15,408 13,612

Total Costs and Expenses Applicable to Revenues

21,507 19,566

$ 29,086 $ 23,584

(1) Included within the Other segment expenses are costs related to the manufacturing and build of IMAX Systems recognized in the period, maintenance and warranty costs, and other product related costs.

Geographic Information

2 unchanged sentences

IMAX Film Remastering and distribution revenue is generated through contractual relationships with studios and other third parties that may not be in the same geographical location as the IMAX Systems that exhibit the remastered films.

The following table summarizes the Company’s revenues by geographic area for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended Nine Months Ended

September 30, September 30,

The following table summarizes the Company’s revenues by geographic area for the three months ended March 31, 2025 and 2024:

Three Months Ended

(In thousands of U.S.

3 unchanged sentences

Asia (excluding Greater China)

16,930 18,042 35,643 44,649

Western Europe

Canada 1,687 4,387 7,254 15,685

Latin America 1,957 1,460

Canada 1,402 2,408

Rest of the World 3,768 3,881

Total $ 86,667 $ 79,123

The United States, Greater China (which includes the mainland of the People’s Republic of China, Hong Kong, Macau, and Taiwan), Western Europe and Asia (excluding Greater China) each comprise greater than 10 % of the Company’s total revenues for the three and nine months ended September 30, 2024 and 2023.

respectively.

The United States, Greater China (which includes the mainland of the People’s Republic of China, Hong Kong, Macau, and Taiwan), and Asia (excluding Greater China) each comprise greater than 10 % of the Company’s total revenues for the three months

ended March 31, 2025.

The United States, Greater China, Western Europe and Asia each comprise greater than 10 % of the Company’s total revenues for the three months ended March 31, 2024.

Employee’s Pension and Postretirement Benefits

1 unchanged sentence

The Company has an unfunded defined benefit pension plan, the Supplemental Executive Retirement Plan (the “SERP”), covering its CEO, Richard L.

Under the terms of the SERP, if Mr.

Gelfond’s employment is terminated other than for cause (as defined in his employment agreement), he is entitled to receive SERP benefits in the form of a lump sum payment.

SERP benefit payments to Mr.

Gelfond are subject to a deferral for six months after the termination of his employment, at which time Mr.

Gelfond will be entitled to receive interest on the deferred amount credited at the applicable federal rate for short-term obligations.

Pursuant to an amendment to his employment agreement dated September 19, 2022, the term of Mr.

Gelfond’s employment was extended through December 31, 2025, although Mr.

Gelfond has not informed the Company that he intends to retire at that time.

Under the terms of his employment agreement, as amended, the total benefit payable to Mr.

Gelfond under the SERP is fixed at $ 20.3 million.

As of September 30, 2024, the Company’s projected benefit obligation under the SERP is $ 18.8 million (December 31, 2023 — $ 18.2 million).

For the three and nine months ended September 30, 2024, the Company recorded interest costs of $ 0.2 million and $ 0.6 million, respectively, (2023 — $ 0.2 million and $ 0.6 million, respectively) related to the SERP.

As of March 31, 2025, the Company’s projected benefit obligation under the SERP was $ 19.2 million (December 31, 2024 — $ 19.0 million).

For the three months ended March 31, 2025, the Company recorded interest costs of $ 0.2 million (2024 — $ 0.2 million) related to the SERP.

The Company expects to recognize additional interest costs of $ 0.7 million related to the SERP during the remainder of 2025.

3 unchanged sentences

The Company makes contributions to these plans on behalf of employees in an amount up to 5 % of their base salary subject to certain prescribed maximums.

During the three and nine months ended September 30, 2024, the Company contributed and recorded expense of $ 0.2 million and $ 1.1 million, respectively, (2023 — $ 0.3 million and $ 0.9 million, respectively) to its Canadian defined contribution plan and $ 0.2 million and $ 0.7 million, respectively, (2023 — $ 0.2 million and $ 0.7 million, respectively) to its defined contribution employee plan under Section 401(k) of the U.S.

During the three months ended March 31, 2025, the Company contributed and recorded expense of $ 0.3 million (2024 — $ 0.4 million) to its Canadian defined contribution plan and $ 0.3 million (2024 — $ 0.3 million) to its defined contribution employee plan under Section 401(k) of the U.S.

Internal Revenue Code.

3 unchanged sentences

Wechsler, former Chairman of the Company’s Board of Directors (the “Executive Postretirement Benefit Plan”).

The Executive Postretirement Benefit Plan provides that the Company will maintain health benefits for Messrs.

Gelfond and Wechsler until they become eligible for Medicare and, thereafter, the Company will provide Medicare supplemental coverage as selected by Messrs.

Gelfond and Wechsler.

Wechsler retired from the Company’s Board of Directors on June 9, 2021, and the Company is providing him with Medicare supplemental coverage or its cash equivalent.

As of September 30, 2024, the Company’s postretirement benefits obligation under this plan is $ 0.5 million (December 31, 2023 — $ 0.5 million).

For the three and nine months ended September 30, 2024, the Company has recorded an expense of less than $ 0.1 million, respectively (2023 — less than $ 0.1 million, respectively) related to this plan.

As of March 31, 2025, the Company’s postretirement benefits obligation under this plan is $ 0.5 million (December 31, 2024 — $ 0.5 million).

For the three months ended March 31, 2025, the Company has recorded an expense of less than $ 0.1 million (2024 — less than $ 0.1 million) related to this plan.

Postretirement Benefits – Canadian Employees

1 unchanged sentence

The Company will provide eligible participants, upon retirement, with health and welfare benefits.

As of September 30, 2024, the Company’s postretirement benefits obligation under this plan is $ 0.8 million (December 31, 2023 — $ 1.0 million).

For the three and nine months ended September 30, 2024, the Company has recorded expense of less than $ 0.1 million, respectively, (2023 — less than $ 0.1 million and $ 0.1 million, respectively) related to this plan.

As of March 31, 2025, the Company’s postretirement benefits obligation under this plan is $ 0.8 million (December 31, 2024 — $ 0.8 million).

For the three months ended March 31, 2025, the Company has recorded expense of less than $ 0.1 million (2024 — less than $ 0.1 million) related to this plan.

Deferred Compensation Benefit Plan

1 unchanged sentence

Under the terms of the Retirement Plan, the benefits were due to vest in full if the executive incurred a separation from service from the Company (as defined therein).

In 2018, the executive incurred a separation from service from the Company, and as such, the Retirement Plan benefits became fully vested as of December 31, 2018.

As of September 30, 2024, the benefit obligation related to the Retirement Plan was $ 4.2 million (December 31, 2023 — $ 4.1 million) and is recorded on the Company’s Condensed Consolidated Balance Sheets within Accrued and Other Liabilities.

As of March 31, 2025, the benefit obligation related to the Retirement Plan was $ 4.3 million (December 31, 2024 — $ 4.2 million) and is recorded on the Company’s Condensed Consolidated Balance Sheets within Accrued and Other Liabilities.

As the Retirement Plan is fully vested, the benefit obligation is measured at the present value of the benefits expected to be paid in the future with the accretion of interest recognized in the Condensed Consolidated Statements of Operations within Retirement Benefits Non-Service Expense.

The Retirement Plan is funded by an investment in company-owned life insurance (“COLI”), which is recorded at its fair value on the Company’s Condensed Consolidated Balance Sheets within Prepaid Expenses.

As of September 30, 2024, fair value of the COLI asset was $ 3.6 million (December 31, 2023 — $ 3.5 million).

As of March 31, 2025, fair value of the COLI asset was $ 3.7 million (December 31, 2024 — $ 3.6 million).

Gains and losses resulting from changes in the cash surrender value of the COLI asset are recognized in the Condensed Consolidated Statements of Operations within Realized and Unrealized Investment Gains.

2 unchanged sentences

The Company’s cash is invested with various major financial institutions.

The Company’s $ 104.5 million balance of cash and cash equivalents as of September 30, 2024 (December 31, 2023 — $ 76.2 million) includes $ 90.8 million in cash held outside of Canada (December 31, 2023 — $ 68.5 million), of which $ 49.9 million was held in the PRC (December 31, 2023 — $ 30.0 million).

The Company’s $ 97.1 million balance of cash and cash equivalents as of March 31, 2025 (December 31, 2024 — $ 100.6 million) includes $ 91.3 million in cash held outside of Canada (December 31, 2024 — $ 85.4 million), of which $ 53.9 million was held in the PRC (December 31, 2024 — $ 47.5 million).

Fair Value Measurements

The carrying values of the Company’s Cash and Cash Equivalents, Accounts Receivable, Accounts Payable and Accrued Liabilities due within one year approximate their fair values due to the short-term maturity of these instruments.

Including these instruments, the Company’s financial instruments consist of the following:

As of September 30, 2024

The carrying values of the Company’s Cash and Cash Equivalents, Accounts Receivable, Variable Consideration, Accounts Payable and Accrued Liabilities due within one year approximate their fair values due to the short-term maturity of these instruments.

Including these instruments, the Company’s financial instruments consisted of the following:

As of March 31, 2025

As of December 31, 2024

4 unchanged sentences

Estimated Fair Value

Cash and cash equivalents (1)

$ 104,504 $ 104,504 $ 76,200 $ 76,200

Net financed sales receivables (1)

2 unchanged sentences

29,500 26,802 29,339 25,322

Equity securities (1)

1,000 1,000 1,000 1,000

3,616 3,616 3,522 3,522

Foreign exchange contracts — designated forwards (3)

115 115 819 819

Wells Fargo Credit Facility borrowings (1)

( 47,000 ) ( 47,000 ) ( 24,000 ) ( 24,000 )

Federal Economic Development Loan (3)

( 2,278 ) ( 2,278 ) ( 2,498 ) ( 2,498 )

Convertible Notes (2)

( 230,000 ) ( 254,566 ) ( 230,000 ) ( 234,009 )

(1) Recorded at cost, which approximates fair value.

(2) Fair value is estimated based on discounting future cash flows at currently available interest rates with comparable terms.

(1) Fair value is determined using quoted prices in active markets.

(4) Measured at cash surrender value, which approximates fair value.

(2) Fair value is determined using quoted market prices that are observable in the market or that could be derived from observable market data.

14 unchanged sentences

The Company has entered into a series of foreign currency forward contracts to manage the risks associated with the volatility of foreign currencies.

Certain of these foreign currency forward contracts met the criteria required for hedge accounting under the Derivatives and Hedging Topic of the FASB ASC at inception, and continue to meet hedge effectiveness tests as of September 30, 2024 (the “Foreign Currency Hedges”), with settlement dates throughout 2024 and 2025.

Foreign currency derivatives are recognized and measured in the Condensed Consolidated Balance Sheets at fair value.

Certain of these foreign currency forward contracts met the criteria required for hedge accounting under the Derivatives and Hedging Topic of the FASB ASC at inception, and continued to meet hedge effectiveness tests as of March 31, 2025 (the “Foreign Currency Hedges”), with settlement dates throughout 2025 and 2026.

Foreign currency derivatives are recognized and measured on the Condensed Consolidated Balance Sheets at fair value.

Changes in the fair value (i.e., gains or losses) are recognized in the Condensed Consolidated Statements of Operations except for derivatives designated and qualifying as foreign currency cash flow hedging instruments.

The Company currently has cash flow hedging instruments associated with Selling, General and Administrative Expenses.

For foreign currency cash flow hedging instruments related to Selling, General and Administrative Expenses, the effective portion of the gain or loss in a hedge of a forecasted transaction is reported in Accumulated Other Comprehensive Loss and reclassified to the Condensed Consolidated Statements of Operations when the forecasted transaction occurs.

For foreign currency cash flow hedging instruments related to Selling, General and Administrative Expenses, the effective portion of the gain or loss in a hedge of a forecasted transaction is reported in Accumulated Other Comprehensive Loss (“AOCI”) and reclassified to the Condensed Consolidated Statements of Operations when the forecasted transaction occurs.

Any ineffective portion is recognized immediately in the Condensed Consolidated Statements of Operations.

The notional value of foreign currency cash flow hedging instruments that qualify for hedge accounting as of September 30, 2024 was $ 31.8 million (December 31, 2023 — $ 40.6 million).

The following tabular disclosures reflect the impact that derivative instruments and hedging activities have on the Company’s Condensed Consolidated Financial Statements:

Notional value of derivatives in foreign exchange contracts:

September 30, December 31,

March 31, December 31,

(In thousands of U.S.

3 unchanged sentences

Fair value of derivatives in foreign exchange contracts:

September 30, December 31,

March 31, December 31,

(In thousands of U.S.

4 unchanged sentences

( 1,458 ) ( 2,029 )

$ ( 1,409 ) $ ( 2,029 )

Derivatives in foreign currency hedging relationships are as follows:

Three Months Ended Nine Months Ended

September 30, September 30,

Three Months Ended

(In thousands of U.S.

2024 2023 2024 2023

Foreign exchange contracts — Forwards

Derivative Gain (Loss)

Derivative Loss

Recognized in OCI

1 unchanged sentence

$ ( 715 ) $ ( 916 )

Three Months Ended Nine Months Ended

September 30, September 30,

Three Months Ended

(In thousands of U.S.

2 unchanged sentences

(Effective Portion)

2024 2023 2024 2023

Foreign exchange contracts — Forwards

2 unchanged sentences

$ ( 1,335 ) $ ( 11 )

The Company’s estimated net amount of the existing gain as of September 30, 2024 is $ 0.1 million, which is expected to be reclassified to the Condensed Consolidated Statements of Operations within the next twelve months.

Investments in Equity Securities

The Company held an investment in the preferred shares of enterprises which meets the criteria for classification as an equity security carried at historical cost, net of impairment charges.

The carrying value of the equity security investment was $ 1.0 million as of September 30, 2024 (December 31, 2023 — $ 1.0 million) and is recorded within Other Assets in the Condensed Consolidated Balance Sheets.

The Company’s estimated net amount of the existing loss as of March 31, 2025 is $ 1.4 million, which was expected to be reclassified to the Condensed Consolidated Statements of Operations within the next twelve months.

Non-Controlling Interests

IMAX China Non-Controlling Interest

The Company indirectly owns 71.55 % of IMAX China, whose shares trade on the Hong Kong Stock Exchange (December 31, 2023 — 71.55 %).

As of March 31, 2025, t he Company indirectly owned 71.40 % of the outstanding equity interests in IMAX China, whose shares trade on the Hong Kong Stock Exchange (December 31, 2024 — 71.40 %).

IMAX China remains a consolidated subsidiary of the Company.

As of September 30, 2024, the balance of the Company’s non-controlling interest in IMAX China is $ 77.7 million (December 31, 2023 — $ 71.8 million).

For the three and nine months ended September 30, 2024, the net income attributable to the non-controlling interest in IMAX China is $ 1.4 million and $ 5.1 million, respectively (2023 — $ 3.1 million and $ 7.0 million, respectively).

Other Non-Controlling Interest

The Company’s Original Film Fund was established in 2014 to co-finance a portfolio of 10 original large-format films.

The initial investment in the Original Film Fund was committed by a third party in the amount of $ 25.0 million, with the possibility of contributing additional funds.

The Company has contributed $ 9.0 million to the Original Film Fund since 2014, and has reached its maximum contribution.

As of September 30, 2024, the Original Film Fund has invested $ 22.3 million toward the development of original films.

The related production, financing and distribution agreement includes put and call rights relating to change of control of the rights, title and interest in the co-financed pictures.

Non-Controlling Interest in Temporary Equity

The following table summarizes the movement of the non-controlling interest in temporary equity related to the Original Film Fund for the nine months ended September 30, 2024 and 2023:

September 30,

(In thousands of U.S.

Beginning balance

Net income (loss)

Ending balance

As of March 31, 2025, the balance of the Company’s non-controlling interest in IMAX China was $ 84.1 million (December 31, 2024 — $ 78.1 million).

For the three months ended March 31, 2025, the net income attributable to the non-controlling interest in IMAX China was $ 5.8 million (2024 — $ 2.2 million).

Restructuring and Other Charges

In the first quarter 2025, the Company incurred $ 0.1 million (2024 — $ nil ) of non-recurring fees related to the assessment of its corporate structure and the resulting internal asset sale.

These charges have been recognized in Restructuring and other charges in the Consolidated Statements of Operations.

As of March 31, 2025, the Company’s liability is $ 1.0 million (December 31, 2024 — $ 1.4 million) on the Consolidated Balance Sheets within Accrued and other liabilities related to Restructuring and other charges.

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