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Item 2. Management’s Discussion and Analysis

2025-07-24 compared with 2025-04-23 · 353 added, 234 removed, 488 unchanged (55% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Presented below is Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) for IMAX Corporation (together with its consolidated subsidiaries, unless the context requires otherwise, “IMAX” or the “Company”) for the three months ended March 31, 2025 and 2024.

MD&A should be read in conjunction with Note 13, “Segment Reporting,” in the accompanying Condensed Consolidated Financial Statements in Item 1.

As of March 31, 2025, the Company indirectly owned 71.40% of IMAX China Holding, Inc.

This MD&A should be read in conjunction with Note 13, “Segment Reporting,” in the accompanying Condensed Consolidated Financial Statements in Item 1 as well as the Company’s audited consolidated financial statements and related notes and the discussion under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for the fiscal year ended December 31, 2024 included in the Company’s 2024 Annual Report on Form 10-K (the “2024 Form 10-K”).

As of June 30, 2025, the Company indirectly owned 71.72% of the outstanding equity interest in IMAX China Holding, Inc.

(“IMAX China”), whose shares trade on the Hong Kong Stock Exchange.

IMAX China is a consolidated subsidiary of the Company.

For the three months ended March 31, 2025, net income attributable to IMAX China is $20.4 million, of which $14.6 million is attributable to the shareholders of the Company (2024 — $7.5 million and $5.4 million, respectively).

For the six months ended June 30, 2025, net income attributable to IMAX China is $23.7 million, of which $17.0 million is attributable to the shareholders of the Company (2024 — $12.8 million and $9.1 million, respectively).

SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION

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Private Securities Litigation Reform Act of 1995 or “forward-looking information” within the meaning of Canadian securities laws.

These forward-looking statements include, but are not limited to, statements regarding business and technology strategies and measures to implement strategies, statements about the Company’s belief and expectations, competitive strengths, goals, market opportunity and penetration, including opportunities in and expected growth from international markets, expansion and growth of business, operations and technology, future capital expenditures (including the amount and nature thereof), the Company’s technological capabilities and the differentiation thereof, brand equity and brand awareness and the benefits thereof, industry prospects and consumer behavior, future industry developments, including expected releases and the timing and effects thereof, plans and references to the future success of the Company and expectations regarding its future operating, financial and technological results.

These forward-looking statements include, but are not limited to, statements regarding business and technology strategies and measures to implement strategies, statements about the Company’s belief and expectations, competitive strengths, goals, market opportunity and penetration, including opportunities in and expected growth from international markets, momentum and runway for, expansion and growth of business, network, operations and technology, future capital expenditures (including the amount and nature thereof), the Company’s technological capabilities and the differentiation thereof, brand equity and brand awareness and the benefits thereof, industry prospects and consumer behavior, future industry developments, including expected releases and the timing and effects thereof, plans and references to the future success of the Company and expectations regarding its future operating, financial and technological results, including its box office guidance for 2025.

These forward-looking statements are based on certain assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate in the circumstances.

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The Company makes available, free of charge, its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, and any amendments to such reports, as soon as reasonably practicable after such filings have been made with the SEC and Canadian securities regulators.

Reports may be obtained free of charge through the SEC’s website at www.sec.gov or the SEDAR+’s website at www.sedarplus.ca and through the Company’s website at www.imax.com or by calling the Company’s Investor Relations Department at 212-821-0154.

Reports may be obtained free of charge through the SEC’s website at www.sec.gov or the SEDAR+ website at www.sedarplus.ca and through the Company’s website at www.imax.com or by calling the Company’s Investor Relations Department at 212-821-0154.

The Company announces material information to the public through a variety of means, including filings with the SEC and Canadian securities regulators, press releases, public conference calls, and its website at www.imax.com.

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IMAX has the largest global premium format network, more than double the size of its nearest competitor.

As of March 31, 2025, there were 1,810 IMAX Systems in 89 countries and territories, including 1,738 commercial multiplexes, 11 commercial destinations, and 61 institutional locations in the Company’s global network.

This compares to 1,772 IMAX Systems in 89 countries and territories as of March 31, 2024, including 1,697 commercial multiplexes, 12 commercial destinations, and 63 institutional locations in the Company’s global network.

As of June 30, 2025, there were 1,821 IMAX Systems in 89 countries and territories, including 1,750 commercial multiplexes, 11 commercial destinations, and 60 institutional locations in the Company’s global network.

This compares to 1,780 IMAX Systems in 89 countries and territories as of June 30, 2024, including 1,705 commercial multiplexes, 12 commercial destinations, and 63 institutional locations in the Company’s global network.

(Refer to the table under “IMAX Network and Backlog” for additional information on the composition of the IMAX network.)

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The incremental box office generated by IMAX films combined with IMAX’s leading global network footprint and scale has helped establish IMAX as a key premium distribution and marketing platform for Hollywood and foreign local language movie studios.

The Company achieved a box office record in the first quarter in 2025 of $298.2 million, including booking fees, from 33 new films and other content released during the quarter, highlighted by the performance of Ne Zha 2, a Chinese local language animation film.

The Company continues to evolve its platform to bring new, innovative events and experiences to audiences worldwide.

During the first quarter, the Company partnered with Sony Pictures for the exclusive release of Becoming Led Zeppelin.

In addition, the Company continued to partner with A24 for a monthly one-night-only IMAX releases of classic A24 titles, including in the first quarter Talk to Me , Moonlight, and Spring Breakers.

The Company partnered with NBC universal for the SNL50 The Homecoming Concert screening in five North American IMAX locations.

The Company also partnered with DAZN for the PSG v Marseille Le Classique Match screening in select IMAX locations across France.

As of March 31, 2025, the Company had a footprint of 265 connected locations in the IMAX network across North America, Europe, Africa, Australia and Asia configured with connectivity to deliver live and interactive events with low latency and superior sight and sound.

Furthermore, the Company can deploy its StreamSmart TM technology to deliver live events to virtually any theater around the world.

The Company achieved a box office record in the first half of 2025 of $579.2 million, including booking fees, a 24% increase over the prior year comparative period, from 54 new films and other content released during the period, highlighted by the performance of Ne Zha 2, a Chinese local language animation film, and strong performance from a number of Filmed for IMAX ® releases including three titles (“ Sinners ,” “ Mission:

Impossible - The Final Reckoning ,” and “ F1 The Movie ”) where IMAX delivered approximately 20% or more of the opening weekend domestic box office contributing to 19% second quarter year over year growth in global box office market share to 3.6%, with a footprint of less than 1% of screens.

Prior to these three titles there were only five Hollywood movies in the Company’s history where IMAX accounted for over 20% of the opening weekend’s domestic box office.

As a premier global technology platform for entertainment and events, the Company strives to remain at the forefront of advancements in technology.

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Furthermore, the Company is actively exploring other global use cases for AI to save costs and to improve its products, operations, and efficiency.

government has implemented substantial and rapidly evolving changes to U.S.

trade policies, including increased tariffs on imports.

These actions have resulted in retaliatory measures and uncertainty in global trade relationships.

For a description of these risks, see “Risk Factors —The Company’s business may be materially adversely affected by the imposition of tariffs and other trade barriers and retaliatory countermeasures implemented by the United States and other governments.” in Part II, Item 1A of this Form 10-Q.

SOURCES OF REVENUE

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(i) Content Solutions, which principally includes content enhancement and distribution services, and (ii) Technology Products and Services, which principally includes the sale, lease, and maintenance of IMAX Systems.

The Company’s activities that do not meet the criteria to be considered a reportable segment are disclosed within All Other (See Note 13 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1).

The Company’s activities that do not meet the criteria to be considered a

reportable segment are disclosed within All Other (See Note 13 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1).

Content Solutions

The Content Solutions segment earns revenue principally from studios and other content creators for IMAX Film Remastering.

The Content Solutions segment earns revenue from Film Remastering, including the distribution of this content across the IMAX global network.

To a lesser extent, the Content Solutions segment also earns revenue from the distribution of large-format documentary films and IMAX events and experiences, including music, gaming, and sports, as well as the provision of film post-production services.

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In a typical IMAX Film Remastering and distribution arrangement, the Company receives a percentage of the box office from a movie studio in exchange for converting a commercial film into the 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 (i.e., gross box office (“GBO”) less applicable sales taxes), except for within Greater China, where the Company receives a lower percentage of net box office receipts for certain Hollywood films due to an import tax.

The fee earned by the Company in a typical IMAX Film Remastering and distribution arrangement averages approximately 12.5% of box office (i.e., gross box office (“GBO”) less applicable sales taxes), except for within Greater China, where the Company often receives a lower percentage of net box office due to tax.

IMAX Film Remastering digitally enhances the image quality and/or resolution for projection on IMAX screens while maintaining or enhancing the visual clarity and sound quality to levels for which The IMAX Experience is known.

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IMAX films also benefit from enhancements made by individual filmmakers exclusively for the IMAX release of the film.

Collectively, the Company refers to these enhancements as “IMAX DNA”.

Filmmakers and movie studios increasingly seek to infuse more IMAX DNA in theatrical releases to realize a filmmaker’s creative vision more fully, while generating interest and excitement among moviegoers.

Collectively, the Company refers to these enhancements as “IMAX DNA.” Filmmakers and movie studios increasingly seek to infuse more IMAX DNA in theatrical releases to realize a filmmaker’s creative vision more fully, while generating interest and excitement among moviegoers.

Such enhancements include shooting films with IMAX cameras to increase the audience’s immersion in the film and to take advantage of the unique dimensions of the IMAX screen by projecting the film in a larger aspect ratio that delivers up to 26% more image onto a standard IMAX movie screen.

In select IMAX locations worldwide, movies filmed with IMAX cameras have an IMAX-exclusive 1.43 film aspect ratio, delivering up to 67% more image.

The Company’s Filmed For IMAX ® program enables filmmakers craft films from their inception to optimize The IMAX Experience and provides incremental and bespoke marketing support.

The Company’s Filmed For IMAX ® program enables filmmakers to craft films from their inception to optimize The IMAX Experience and provides incremental and bespoke marketing support.

The box office metrics demonstrate audiences respond extremely favorable to Filmed For IMAX ® titles, resulting in a higher market share for IMAX.

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As the popularity of local language films has continued to increase, the Company has extended its content strategy to distribute local language content beyond native markets.

During the three months ended March 31, 2025, local language films exhibited across the Company’s global network generated over $202 million in box office, representing 68% of the Company’s global box office, including the Chinese local language film, Ne Zha 2 , which became the highest grossing IMAX release of all time in China.

The following table provides the number of new films and other content that were released to the Company’s global network during the three months ended March 31, 2025 and 2024, respectively:

Three Months Ended

For the first six months in 2025, local language films exhibited across the Company’s global network generated over $222 million in box office, representing 38% of the Company’s global box office, including the Chinese local language film, Ne Zha 2 , which became the highest grossing IMAX release of all time in China.

The following table provides the number of new films and other content that were released to the Company’s global network during the three and six months ended June 30, 2025 and 2024:

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

Hollywood film releases (1)

Local language film releases:

China 4 4 10 8

South Korea 2 2 4 3

Japan 1 5 4 8

India 1 2 6 4

Saudi Arabia 1 — 1 —

Egypt 1 — 1 —

France — — 2 —

Vietnam — — 1 —

Indonesia — 1 1 1

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Other Content Solutions

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Traditionally, the Company receives as its distribution fee either a fixed amount or a fixed percentage of the theater box office and, following the recoupment of its costs, is typically entitled to receive an additional percentage of gross revenues as participation revenues.

In the first quarter of 2025, the Company released the institutional 3D version of Blue Angels across select IMAX locations in North America, Europe, and Australia.

Upcoming documentaries, which are currently in production, include Stormbound , a feature documentary produced by Academy Award ® -winning producer, Adam McKay, The Lost Wolves of Yellowstone , and Patrouille de France, all of which are expected to be released in 2025, and The Elephant Odyssey , a documentary in collaboration with Beach House Pictures Pte Ltd and China International Communications Group, which is expected to be released in 2026.

In 2025, the Company released the institutional 3D version of Blue Angels across select IMAX locations in North America, Europe, and Australia.

Upcoming documentaries, which are currently in production, include The Lost Wolves of Yellowstone , which is expected to be released in 2025.

Stormbound , a feature documentary produced by Academy Award-winning producer, Adam McKay, Patrouille de France and The Elephant Odyssey , a documentary in collaboration with Beach House Pictures Pte Ltd and China International Communications Group, are expected to be released in 2026.

The Company continues to believe that the IMAX network is a valuable global platform to launch and distribute original content, including documentaries.

The ownership rights to such films may be held by the film sponsors, the film investors and/or the Company.

As of March 31, 2025, the Company had distribution rights with respect to approximately 65 films, which cover subjects such as space, wildlife, music, sports, history and natural wonders.

As of June 30, 2025, the Company had distribution rights with respect to approximately 65 films, which cover subjects such as space, wildlife, music, sports, history and natural wonders.

In addition, the Company continues to evolve its platform to bring new, innovative IMAX events and experiences to audiences worldwide.

As of March 31, 2025, the Company had a footprint of 265 connected locations in the IMAX network across North America, Europe, Africa, Australia, and Asia configured with connectivity to deliver live and interactive events with low latency and superior sight and sound.

In the three months ended March 31, 2025, the Company partnered with Sony Pictures for the exclusive release of Becoming Led Zeppelin.

The Company also partnered with NBC Universal for the SNL50:

The Homecoming Concert screening in five theaters in North America, and DAZN for the PSG v Marseille Le Classique Match screening.

In addition, the Company continues to partner with A24 for a monthly one-night-only IMAX release of classic A24 titles, including Talk to Me , Moonlight, and Spring Breakers in the first quarter of 2025.

As of June 30, 2025, the Company had a footprint of 266 connected locations in the IMAX network across North America, Europe, Africa, Australia, and Asia configured with connectivity to deliver live and interactive events with low latency and superior sight and sound.

In the six months ended June 30, 2025, the Company partnered with Sony Pictures for the exclusive release of Becoming Led Zeppelin, Magnolia Pictures for the exclusive release of One to One:

John & Yoko and Trafalgar Releasing for the exclusive release of Pink Floyd at Pompeii - MCMLXXII, NBC Universal for the SNL50 The Homecoming Concert in select IMAX North American locations and DAZN for the PSG v Marseille Le Classique Match in select IMAX locations across France.

In addition, the Company continued its partnership with A24 for one-night-only IMAX releases of classic A24 titles, including Talk to Me , Moonlight, and Spring Breakers.

The Company collaborated with Fandango Media for the Fortnite Championship Series:

Pro-Am screening in eight North American IMAX locations and with Wanda Film for the F1 Spanish Grand Prix screening across six IMAX locations in China.

The Company provides film post-production and quality control services for films, whether produced by IMAX or third parties, and digital post-production services.

In addition, the Company also provides IMAX film and digital cameras to content creators under the IMAX certified camera program.

In addition, the Company provides IMAX film and digital cameras to content creators under the IMAX certified camera program.

Technology Products and Services

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The contracts are non-cancellable by the customer unless the Company fails to perform its obligations.

The revenue earned from customers under the Company’s JRSA can vary from quarter-to-quarter and year-to-year based on a number of factors that drive box office levels including film performance, the mix of IMAX System configurations, the timing of installation of IMAX Systems, the nature of the arrangement, the location, size and management of the theater and other factors specific to individual arrangements.

The revenue earned from customers under the Company’s JRSAs can vary from quarter-to-quarter and year-to-year based on a number of factors that drive box office levels including film performance, the mix of IMAX System configurations, the timing of installation of IMAX Systems, the nature of the arrangement, the location, size and management of the theater and other factors specific to individual arrangements.

JRSAs also require IMAX to provide maintenance and extended warranty services to the customer over the term of the lease in exchange for a separate fixed annual fee.

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JRSAs have been an important factor in the expansion of the Company’s commercial system network.

JRSAs allow commercial theater exhibitors to install IMAX Systems without the significant initial capital investment required in a sale or sales-type lease

JRSAs allow commercial theater exhibitors to install IMAX Systems without the significant initial capital investment required in a sale or sales-type lease arrangement.

JRSAs drive recurring cash flows and earnings for the Company as customers under these arrangements pay the Company a portion of their ongoing box office receipts.

The Company funds its investment in equipment for JRSAs through cash flows from operations.

As of March 31, 2025, the Company had 893 locations under joint revenue sharing arrangements in its global commercial multiplex network.

The Company also had contracts in backlog for 346 systems under joint revenue sharing arrangements as of March 31, 2025, including 152 upgrades to existing locations and 194 new locations.

As of June 30, 2025, the Company had 899 locations under JRSAs in its global commercial multiplex network.

The Company also had contracts in backlog for 336 systems under JRSAs as of June 30, 2025, including 138 upgrades to existing locations and 198 new locations.

IMAX Maintenance

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Annual maintenance fees are paid throughout the duration of the term of the system agreements.

Streaming and Consumer Technology

Streaming and Consumer Technology includes the Company’s Streaming Technology software offerings and IMAX Enhanced products and services.

Streaming Technology consists of several software products, including:

• IMAX StreamSmart – works within existing video compression workflows to reduce bitrates and retain picture quality across all devices and formats and deliver significant cost savings for both on-demand and live content.

• IMAX StreamAware On-Demand – all-in-one quality assurance and quality control to automate and standardize checks for comprehensive content integrity and regulatory compliance for third-party content libraries, across an entire video compression workflow.

• IMAX StreamAware On-Air – real-time monitoring software for live streams, which enables users to monitor video quality across their networks and to identify and address streaming issues.

• Stream it in IMAX Enhanced - end-to-end technology solution that dynamically improves video and audio fidelity for live and on-demand content.

These products are powered by IMAX VisionScience ® , an AI technology that allows streaming platforms and broadcasters to automate workflows.

The Company believes that these products allow users to deliver the highest quality viewing experiences to their subscribers while reducing costs.

IMAX Enhanced is a solution to bring The IMAX Experience into the home.

IMAX Enhanced provides end-to-end premium technology across streaming content and best-in-class entertainment devices, offering consumers high-fidelity playback of image and sound in the home and beyond, including the following features:

• IMAX’s expanded aspect ratio, which is available on select titles and streaming platforms;

• IMAX’s proprietary remastering technology, which produces more vivid, higher-fidelity 4K HDR images on premium televisions;

• IMAX’s signature sound, which was specially recreated and calibrated for the home to unlock more immersive audio.

To be certified as IMAX Enhanced, leading consumer electronics manufacturers spanning 4K/8K televisions, projectors, A/V receivers, loudspeakers, soundbars, smartphones, personal computers, tablets, and more must meet a carefully prescribed set of audiovisual performance standards, set by a certification committee, along with some of Hollywood’s leading technical specialists.

At present, certified global device partners include Sony Electronics, Hisense, TCL, LG, Phillips, Hewlett Packard, Xiaomi, Sound United and Honor, among others.

As of March 31, 2025, more than 300 IMAX Enhanced titles had been released across six of the biggest streaming platforms worldwide:

Disney+, Sony Pictures CORE, Tencent Video, iQiyi, Yonku and Rakuten TV.

Over 15 million IMAX Enhanced certified devices are estimated to be in use today.

IMAX Streaming and Consumer Technology is part of the Company’s next evolutionary step to extend the IMAX brand and technology further into new use cases, including streaming entertainment and the consumer electronics market.

IMAX Enhanced | Streaming and Consumer Technology

IMAX’s Streaming and Consumer Technology (“SCT”) segment now offers a single unified program:

IMAX Enhanced.

This umbrella program builds on IMAX’s brand and proprietary VisionScience™ technology to deliver The IMAX Experience to fans across streaming platforms and consumer devices.

The new ‘IMAX Enhanced’ program for partners includes three core elements:

IMAX Enhanced Live:

Real-time enhancement for sports, concerts, and events using SCT’s proprietary technology to measure, enhance, optimize, and validate premium color, contrast, and clarity at the speed of live.

IMAX Enhanced On-Demand:

Quality preservation and optimization for films and series to preserve creative intent with IMAX-calibrated fidelity and remastering, offering viewers a differentiated, premium IMAX-assured experience.

IMAX Enhanced on-demand content is currently available for fan-favorite titles across leading services such as Disney+, Sony Pictures Core, and Tencent Video.

Device Certification & Calibration:

Establishes IMAX quality standards for consumer devices to ensure playback meets IMAX benchmarks.

It assures that the enhancement and preservation of quality applied upstream for both Live and On-Demand workflows is maintained faithfully and experienced as intended on consumer devices.

As of June 30, 2025, over 15 million IMAX Enhanced certified devices are in-market with partners including Sony Electronics, Hisense, TCL, LG, and Philips.

The SCT products previously branded as StreamSmart™ (encoding optimization) and StreamAware™ (quality assurance and monitoring) have now been fully streamlined and integrated into the IMAX Enhanced program, improving operational efficiency, reducing overhead, and enabling partners to deliver differentiated, premium, and monetizable viewing experiences validated through IMAX’s proprietary approach to visual quality.

IMAX’s Streaming and Consumer Technology is part of the Company’s next evolutionary step to extend the IMAX brand and technology into new use cases and programming, including live events, series, and fully leveraging consumer electronics to deliver premium experiences for fans at home.

All Other also includes revenues from sources including one owned and operated IMAX System in Sacramento, California;

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IMAX NETWORK AND BACKLOG

The following table provides detailed information about the IMAX network by type and geographic location as of March 31, 2025 and 2024.

The following table provides detailed information about the IMAX network by type and geographic location as of June 30, 2025 and 2024.

For additional information regarding the composition of the IMAX network, see “Marketing and Customers” in Part I, Item 1 of the Company’s 2024 Form 10-K.

March 31, 2025 March 31, 2024

June 30, 2025 June 30, 2024

Institutional

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(See “Risk Factors – The Company faces risks in connection with its significant presence in China and the continued expansion of its business there,” “Risk Factors – The Company may not convert all of its backlog into revenue and cash flows,” and “Risk Factors – General political, social and economic conditions can affect the Company’s business by reducing both revenues generated from existing IMAX Systems and the demand for new IMAX Systems” in Part I, Item 1A of the Company’s 2024 Form 10-K.)

IMAX currently estimates a worldwide commercial multiplex addressable market of 3,619 locations, of which there are 1,738 IMAX Systems operating as of March 31, 2025, representing a market penetration of only 48%.

IMAX currently estimates a worldwide commercial multiplex addressable market of 3,619 locations, of which there are 1,750 IMAX Systems operating as of June 30, 2025, representing a market penetration of only 48%.

The Company believes that the majority of its future growth will come from international markets.

As of March 31, 2025, 76% of IMAX Systems in the global commercial multiplex network were located within international markets (defined as all countries other than the United States and Canada).

As of June 30, 2025, 76% of IMAX Systems in the global commercial multiplex network were located within international markets (defined as all countries other than the United States and Canada).

Revenues and GBO derived from international markets continue to exceed revenues and GBO from the United States and Canada.

Risks associated with the Company’s international business are outlined in “Risk Factors – The Company conducts business internationally, which exposes it to uncertainties and risks that could negatively affect its operations, sales and future growth prospects” in Part I, Item 1A of the Company’s 2024 Form 10-K.

The following tables provide detailed information about IMAX Systems operating in multiplex locations by arrangement type and geographic location as of March 31, 2025 and 2024:

March 31, 2025

The following tables provide detailed information about IMAX Systems operating in multiplex locations by arrangement type and geographic location as of June 30, 2025 and 2024:

June 30, 2025

Commercial Multiplex Locations in IMAX Network

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(2) Period-to-period changes in the tables above are reported net of permanently closed locations.

March 31, 2024

June 30, 2024

Commercial Multiplex Locations in IMAX Network

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(2) Period-to-period changes in the tables above are reported net of permanently closed systems.

The following table provides detailed information about the Company’s backlog as of March 31, 2025 and 2024:

March 31, 2025 March 31, 2024

Systems Dollar

Values Number of

Systems Dollar

(In thousands of U.S.

Dollars, except number of systems)

Sales Arrangements (1)

161 9 $ 162,359 $ 6,530 149 15 $ 157,494 $ 14,868

Hybrid JRSA (2)

94 — 66,623 — 100 1 74,873 910

Traditional JRSA (2)

100 152 1,979 275 128 49 425 1,575

Total 355 161 $ 230,961 $ 6,805 377 65 $ 232,792 $ 17,353

(1) Includes Sales and Sales-Type Lease deal types.

(2) The consideration owed under traditional joint revenue sharing arrangements is typically a percentage of contingent box office receipts rather than a fixed upfront fee or fixed annual minimum payments.

Accordingly, such arrangements do not usually have a dollar value in backlog;

however, hybrid joint revenue sharing arrangements typically provide for contracted upfront payments and therefore carry a backlog value based on those payments.

The backlog reflects the minimum number of commitments for IMAX Systems according to signed contracts.

The dollar value fluctuates depending on the number of new arrangements signed from year-to-year, which adds to backlog, and the installation and

acceptance of IMAX Systems and the settlement of contracts, both of which reduce backlog.

The dollar value of backlog typically represents the fixed contracted revenue according to the signed IMAX System sale and lease agreements that the Company expects to recognize as revenue upon installation and acceptance of the associated system, as well as an estimate of variable consideration in sales arrangements.

The value of backlog does not include amounts allocated to maintenance and extended warranty revenues or revenue from systems in which the Company has an equity interest, operating leases, and long-term conditional theater commitments.

The Company believes that the contractual obligations for IMAX System installations that are listed in backlog are valid and binding commitments.

From time to time, in the normal course of its business, the Company will have customers who are unable to proceed with an IMAX System installation for a variety of reasons, including the inability to obtain certain consents, approvals or financing.

Once the determination is made that the customer will not proceed with installation, the agreement with the customer is terminated or amended.

If the agreement is terminated, once the Company and the customer are released from all their future obligations under the agreement, all or a portion of the initial rents or fees that the customer previously made to the Company are recognized as revenue.

Certain of the Company’s contracts contain options for the customer to elect to upgrade system type during the term or to alter the contract structure (for example, from a JRSA to a sale) after signing, but before installation.

Current backlog information reflects all known elections.

The following tables provide detailed information about the Company’s backlog by arrangement type and geographic location as of March 31, 2025 and 2024:

March 31, 2025

The following tables provide detailed information about the Company’s backlog by arrangement type and geographic location as of June 30, 2025 and 2024:

June 30, 2025

IMAX System Backlog

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(2) Worldwide Total of 501 includes 256 new IMAX Laser Systems and 145 upgrades of existing locations to IMAX Laser Systems.

March 31, 2024

(3) Worldwide Total of 501 includes 356 new system backlog and 145 upgrade system backlog.

June 30, 2024

IMAX System Backlog

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(2) Worldwide Total of 504 includes 261 new IMAX Laser Systems and 69 upgrades of existing locations to IMAX Laser Systems.

Approximately 74% of IMAX System arrangements in backlog as of March 31, 2025 are scheduled to be installed in international markets (2024 — 32%).

The Company’s system backlog in Greater China represents 45% (2024 — 46%) of its total current backlog, including 191 new IMAX Systems and 43 upgrades (2024 — 195 new and 10 upgrades).

(See “Risk Factors – The Company may not convert all of its backlog into revenue and cash flows.” in Part I, Item 1A.

of the Company’s 2024 Form 10-K.)

(3) Worldwide Total of 504 includes 373 new system backlog and 131 upgrade system backlog.

The backlog reflects the minimum number of commitments for IMAX Systems according to signed contracts.

The Company believes that the contractual obligations for IMAX System installations that are listed in backlog are valid and binding commitments.

Current backlog information reflects all known elections.

Approximately 74% of IMAX System arrangements in backlog as of June 30, 2025 are scheduled to be installed in international markets (2024 — 82%).

(See “Risk Factors – The Company may not convert all of its backlog into revenue and cash flows.” in Part I, Item 1A of the Company’s 2024 Form 10-K.)

Signings and Installations

The following tables provide detailed information about IMAX System signings and installations for the three months ended March 31, 2025 and 2024:

Three Months Ended

The following tables provide detailed information about IMAX System signings and installations for the three and six months ended June 30, 2025 and 2024:

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

System Signings:

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(1) Includes Sales and Sales-Type Lease deal types.

(2) Includes IMAX System upgrades of 58 for the three months ended March 31, 2025 (2024 ― no upgrades).

Three Months Ended

(2) Includes two and 60 IMAX System upgrades for the three and six months ended June 30, 2025, respectively (2024 ― 68 upgrades).

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

System Installations (1) :

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Total IMAX System installations (3)

(1) Three IMAX Systems were relocated from their original location for the three months ended March 31, 2025 (2024 ― one).

(1) Zero and three IMAX Systems were relocated from their original location for the three and six months ended June 30, 2025, respectively (2024 ― one and two relocations, respectively).

When a system is relocated, the amount of revenue earned by the Company may vary from transaction-to-transaction and is usually less than the amount earned for a new sale.

1 unchanged sentence

(2) Includes Sales and Sales-Type Lease deal types.

(3) Includes seven IMAX System upgrades for the three months ended March 31, 2025 (2024 ― three upgrades).

(3) Includes 18 and 25 IMAX System upgrades for the three and six months ended June 30, 2025, respectively (2024 ― eight and 11 upgrades, respectively).

RESULTS OF OPERATIONS

9 unchanged sentences

and (viii) short- and long-term cash flow projections.

Results of Operations for the Three Months Ended March 31, 2025 and 2024

Results of Operations for the Three Months Ended June 30, 2025 and 2024

Net Income and Adjusted Net Income Attributable to Common Shareholders

The following table presents the Company’s net income attributable to common shareholders and the associated per share amounts, as well as adjusted net income attributable to common shareholders* and adjusted net income attributable to common shareholders per share for the three months ended March 31, 2025 and 2024:

Three Months Ended March 31,

The following table presents the Company’s net income attributable to common shareholders and the associated per diluted share amounts, as well as adjusted net income attributable to common shareholders and adjusted net income attributable to common shareholders per diluted share for the three months ended June 30, 2025 and 2024:

Three Months Ended June 30,

(In thousands of U.S.

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Revenues and Gross Margin

For the three months ended March 31, 2025, the Company’s revenues and gross margin increased by $7.5 million, or 10%, and $6.3 million, or 13%, respectively, when compared to same period in 2024, principally due to a higher number of installations and stronger IMAX box office performance driven by the record Chinese New Year period.

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

During the three months ended June 30, 2025, the Company’s revenues and gross margin increased by $2.7 million, or 3%, and $9.7 million, or 22%, respectively, when compared to same period in 2024 principally due to a higher number of installations and stronger IMAX box office performance driven by the Hollywood film slate.

The following table presents the Company’s revenue, gross margin, and gross margin percentage by reportable segment for the three months ended June 30, 2025 and 2024:

Revenue Gross Margin Gross Margin %

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Content Solutions

Content Solutions segment results are influenced by the level of commercial success and box office performance of the films and other content released to the IMAX network, as well as other factors, including the timing of the releases, the length of play across the IMAX network, the box office share take rates under the Company’s Film Remastering and distribution arrangements, the level of marketing spend associated with the releases in the year, and fluctuations in the value of foreign currencies versus the U.S.

For the three months ended March 31, 2025, Content Solutions segment revenues and gross margin increased by $0.2 million, or less than 1%, and $1.5 million, or 7%, respectively, when compared to the same period in 2024.

In the three months ended March 31, 2025, box office generated by IMAX films, including booking fees, totaled $298.2 million, a $30.9 million, or 12%, increase versus the prior year comparative period of $267.3 million, while IMAX box office excluding booking fees totaled $280.7 million, a $20.0 million or 8% increase versus the prior year comparative of $260.7 million.

The growth was primarily driven by the stronger IMAX box office performance of the IMAX local language film slate in 2025.

During the three months ended March 31, 2025, IMAX box office was generated by the exhibition of 34 films and other content (33 new films and 1 re-release), including the following Hollywood titles, Captain America:

Brave New World ($27 million) , Mickey 17 ($11 million) , Mufasa:

The Lion King ($10 million) and Interstellar ($10 million) which was originally released in a prior year.

In the three months ended March 31, 2025, local language films exhibited across the Company’s global network generated over $202 million in box office, representing 68% of its global box office.

The Chinese local language film, Ne Za 2, became the highest grossing IMAX release of all time in China ($161 million, including booking fees) and contributed to the highest grossing Chinese New Year in the Company’s history.

In the three months ended March 31, 2024, IMAX box office was generated by the exhibition of 26 films (19 new films and 7 re-releases), including Dune:

Part Two , which generated box office of over $132 million.

Content Solutions segment results are influenced by the level of commercial success and box office performance of the films and other content released to the IMAX network, as well as other factors, including the timing of the releases, the timing of documentary downstream sales, the length of play across the IMAX network, the box office share take rates under the Company’s Film Remastering and distribution arrangements, the level of marketing spend associated with the releases in the year, and fluctuations in the value of foreign currencies versus the U.S.

For the three months ended June 30, 2025, Content Solutions segment revenues and gross margin decreased by $1.1 million, or 3%, and increased by $6.3 million, or 39%, respectively, when compared to the same period in 2024.

The decrease in revenue compared to the prior period was primarily driven by revenue earned from the completion of the sale of the worldwide commercial and streaming rights of the Company’s original documentary, The Blue Angels , to Amazon Content in the second quarter of 2024.

The documentary sale impact on revenue was mostly offset in the second quarter of 2025 by stronger IMAX box office performance year over year.

In the second quarter of 2025, box office generated by IMAX films, including booking fees, totaled $281.1 million, an $81.3 million, or 41% increase versus the prior year comparative period of $199.8 million.

The growth was primarily driven by the stronger IMAX box office performance of the IMAX Hollywood film slate during the quarter, compared to the second quarter of 2024 box office performance which had fewer large blockbusters due to the Hollywood strikes.

In the second quarter of 2025, IMAX box office was generated by the exhibition of 22 films and other content (21 new films and 1 film originally released in a prior year), including the following Hollywood titles, Mission:

Impossible - The Final Reckoning ($75 million), Sinners ($40 million), F1 The Movie ($32 million) and Thunderbolts ($31 million).

In the second quarter of 2025, local language films exhibited across the Company’s global network generated $19.8 million in box office, representing 7% of its global box office.

In the second quarter of 2024, IMAX box office was generated by the exhibition of 34 films (27 new films and 7 films originally released in a prior year).

In the second quarter of 2025, the Company released six movies that were filmed with IMAX proprietary cameras (Filmed For IMAX):

Sinners , Thunderbolts , Final Destination:

Bloodlines , Mission:

Impossible - The Final Reckoning , How To Train Your Dragon and F1 The Movie .

Filmed For IMAX movies traditionally perform disproportionately well at the box office, and for three of these films ( Sinners , Mission:

Impossible - The Final Reckoning and F1 The Movie ), IMAX delivered approximately 20% or more of the opening weekend domestic box office, despite accounting for only 1% of available screens.

In addition to the level of revenues, Content Solutions segment gross margin is influenced by the costs associated with films and other content (documentaries, live, alternative and other) exhibited in the period.

The costs associated with films and other content can include production, post-production, distribution and marketing, which are expensed as incurred.

For the three months ended June 30, 2025, gross margin percent was 66% compared to 46% in the prior year period.

The increase in gross margin was driven by higher level of IMAX box office and a lower mix of self-produced content compared to the prior period.

Technology Products and Services

The primary drivers of Technology Products and Services segment results are the number of IMAX Systems installed in a period, the costs associated with each installation, lease payments tied to the box office performance of the films released to the IMAX network, as well as the associated maintenance contracts that accompany each installation.

The average revenue and gross margin per IMAX System under sale and sales-type lease arrangements vary depending upon the number of IMAX System commitments with a single respective exhibitor, an exhibitor’s location, the type of IMAX System sold, and various other factors.

The installation of IMAX Systems in theaters or multiplexes, which make up a large portion of the Company’s system backlog, depends primarily on the timing of the construction of those projects, which is not under the Company’s control.

The following table provides information about IMAX Systems installed and the associated revenue recognized at that time, except for traditional JRSAs as revenue is recognized over the lease term, during the three months ended June 30, 2025 and 2024:

Three Months Ended June 30,

(In thousands of U.S.

Dollars, except number of systems) Number of Systems Revenue Number of Systems Revenue

New IMAX Systems

11 $ 11,206 8 $ 7,649

Upgraded IMAX Systems

2 1,878 2 2,926

Total IMAX Systems

13 $ 13,084 10 $ 10,575

For the three months ended June 30, 2025, Technology Products and Services segment revenue increased by $4.7 million, or 9%, while gross margin increased by $4.4 million, or 17%, when compared to the same period in 2024.

The higher level of revenue is primarily driven by a higher level of rental revenues, which is box office driven.

Rental revenues increased by $5.1 million, as IMAX GBO earned from the Company’s JRSAs increased by $24.1 million in the second quarter of 2025 when compared to the prior year comparative period, from $101.0 million to $125.1 million.

Also contributing to the increase in revenue was the higher number of systems recognized under sales and sales-type lease arrangements, per the table above.

The increase in revenues described above were partially offset by a $4.7 million decrease in revenue contribution from the impact of amendments, renewals and other agreements to existing IMAX Systems arrangements.

For the three months ended June 30, 2025, gross margin percent was 54% compared to 51% in the prior period, which primarily reflects the higher level of revenues generated from stronger IMAX box office performance, as described above.

For the three months ended June 30, 2025, All Other revenue and gross margin decreased by $0.9 million and $1.0 million, respectively, when compared to the same period in 2024.

All Other primarily reflects the results of the Company’s Streaming and Consumer Technology business.

Selling, General and Administrative Expenses

The following table presents information about the Company’s Selling, General and Administrative Expenses for the three months ended June 30, 2025 and 2024:

Three Months Ended

June 30, Variance

(In thousands of U.S.

Total Selling, general and administrative expenses

$ 35,302 $ 37,564 $ (2,262) (6 %)

Share-based compensation (1)

(6,862) (6,506) (356) (5 %)

Total Adjusted Selling, general and administrative expenses

$ 28,440 $ 31,058 $ (2,618) (8 %)

(1) A portion of share-based compensation expense is recognized within Costs and Expenses Applicable to Revenues, and Research and Development.

(Refer to “Capital Stock and Reserves — Share-Based Compensation” in Note 11 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1.)

For the second quarter of 2025, the lower level of Selling, General and Administrative Expenses year-over-year reflects management’s continued focus on operational efficiencies, including workforce reductions.

Additionally, in the period, the Company recognized $2.5 million in benefits resulting from an Employee Retention Credit as a reduction to Selling, General and Administrative expenses, partially offset by higher annual incentive compensation costs.

Research and Development

For the three months ended June 30, 2025, Research and Development expenses were $1.5 million, compared to an expense of $2.0 million during the same period in the prior year.

The reduction year-over-year was primarily driven by the capitalization of film camera costs in accordance with the achievement of technological feasibility in 2024.

The Company continues to expense its investment in other projects, including in the development of new Streaming and Technology product offerings and improvements to its existing IMAX System product suite.

Credit Loss (Reversal) Expense, Net

For the three months ended June 30, 2025, the Company recorded a credit loss reversal of $0.2 million, as compared to a credit loss expense of $0.1 million recognized in the prior year.

Stronger box office performance in the year has contributed to a notable improvement in collections.

The resurgence in theatrical attendance, driven by a robust film slate, has increased and accelerated cash inflows from studio and exhibitor customers.

This trend reflects both the sustained consumer demand for premium cinematic experiences and the effectiveness of our strategic initiatives in global distribution and exhibition.

Management’s judgments regarding expected credit losses are based on the facts available to management at the time that the Condensed Consolidated Financial Statements are prepared and involve estimates about the future.

As a result, the Company’s judgments and associated estimates of credit losses may ultimately prove, with the benefit of hindsight, to be incorrect.

(Refer to Note 3 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1.)

Interest Expense and Interest Income

For the three months ended June 30, 2025, interest expense was $1.9 million, representing an decrease of $0.4 million, or 16% when compared to interest expense of $2.3 million during the same period of the prior year primarily due to a lower level of borrowings under the Credit Facility in the current period.

For the three months ended June 30, 2025 and 2023, interest income was $1.1 million and $0.6 million, respectively.

For the three months ended June 30, 2025, the Company recorded an income tax expense of $1.2 million (2024 — tax benefit of $4.0 million).

The Company’s effective tax rate of 8.9% for the three months ended June 30, 2025, reflects the geographic allocation of income earned in taxing jurisdictions and reflects a decrease in the valuation allowance.

During the three months ended June 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.

Non-Controlling Interests

For the three months ended June 30, 2025, the net income attributable to non-controlling interests of the Company’s subsidiaries was $1.0 million, a decrease of $0.5 million, when compared to the same period in 2024, primarily due to lower revenues recognized from sales arrangements and renewals in Greater China.

Restructuring and Other Charges

For the three months ended June 30, 2025, the Company recorded $0.8 million (2024 — $nil) of restructuring and other charges.

These charges are associated with continued strategic initiatives aimed at enhancing operational efficiency, reducing costs, and optimizing the Company’s organization structure.

Specifically, the Company incurred $0.5 million in connection with the continued implementation of its plan to optimize its organizational structure, including the elimination of redundant roles, addressing spans and layers to capture efficiencies and centralize certain operational roles.

Additionally, the Company incurred $0.3 million of non-recurring fees relating to the 2024 internal asset sale.

Results of Operations for the Six Months Ended June 30, 2025 and 2024

Net Income and Adjusted Net Income Attributable to Common Shareholders

The following table presents the Company’s net income attributable to common shareholders and the associated per diluted share amounts, as well as adjusted net income attributable to common shareholders* and adjusted net income attributable to common shareholders per diluted share for the six months ended June 30, 2025 and 2024:

Six Months Ended June 30,

(In thousands of U.S.

Dollars, except per diluted share amounts)

Per Diluted Share

Net income attributable to common shareholders

$ 13,582 $ 0.25 $ 6,857 $ 0.13

Adjusted net income attributable to common shareholders*

$ 21,785 $ 0.40 $ 17,688 $ 0.33

*Refer to “Non-GAAP Financial Measures” for a description of this non-GAAP financial measure and a reconciliation to the most comparable GAAP amount.

Revenues and Gross Margin

For the six months ended June 30, 2025, the Company’s revenues and gross margin increased by $10.3 million, or 6%, and $16.0 million, or 18%, respectively, when compared to same period in 2024, principally due to a higher number of installations and stronger IMAX box office performance driven by a record Chinese New Year period and the summer Hollywood box office.

The following table presents the Company’s revenue, gross margin, and gross margin percentage by reportable segment for the six months ended June 30, 2025 and 2024:

Revenue Gross Margin Gross Margin %

(In thousands of U.S.

2025 2024 2025 2024 2025 2024

Content Solutions

$ 68,214 $ 69,089 $ 45,985 $ 38,237 67 % 55 %

Technology Products and Services

106,232 94,048 59,264 49,367 56 % 52 %

Sub-total for reportable segments

174,446 163,137 105,249 87,604 60 % 54 %

All Other (1)

3,905 4,947 1,529 3,212 39 % 65 %

Total $ 178,351 $ 168,084 $ 106,778 $ 90,816 60 % 54 %

(1) All Other includes the results from Streaming and Consumer Technology and other ancillary activities.

Content Solutions

Content Solutions segment results are influenced by the level of commercial success and box office performance of the films and other content released to the IMAX network, as well as other factors, including the timing of the releases, the timing of documentary downstream sales, the length of play across the IMAX network, the box office share take rates under the Company’s Film Remastering and distribution arrangements, the level of marketing spend associated with the releases in the year, and fluctuations in the value of foreign currencies versus the U.S.

For the six months ended June 30, 2025, Content Solutions segment revenues and gross margin decreased by $0.9 million, or 1%, and increased by $7.7 million, or 20%, respectively, when compared to the same period in 2024.

The decrease in revenue compared to the prior period is primarily driven by revenue earned from the completion of the sale of the worldwide commercial and streaming rights of the Company’s original documentary, The Blue Angels , to Amazon Content in the first half of 2024.

The positive impact of The Blue Angels documentary in 2024 on revenue was mostly offset by higher box office generated across the IMAX network for the six months ended June 30, 2025, when compared to the prior year period.

In the six months ended June 30, 2025, box office generated by IMAX films, including booking fees, totaled $579.2 million, a $112.1 million, or 24%, increase versus the prior year comparative period of $467.2 million.

This growth was primarily driven by the stronger IMAX box office performance of the IMAX local language film slate in 2025.

During the six months ended June 30, 2025, IMAX box office was generated by the exhibition of 56 films and other content (54 new films and 2 re-releases), including the following Hollywood titles, Mission:

Impossible - The Final Reckoning ($75 million), Sinners ($39 million), F1 The Movie ($31 million) and Thunderbolts ($31 million).

In addition, in the six months ended June 30, 2025, local language films exhibited across the Company’s global network generated over $222 million in box office, representing 38% of its global box office.

The Chinese local language film, Ne Zha 2, became the highest grossing IMAX release of all time in China ($166 million, including booking fees) and contributed to the highest grossing Chinese New Year in the Company’s history.

In the six months ended June 30, 2024, IMAX box office was generated by the exhibition of 60 films (46 new films and 14 films originally released in a prior year).

In the first half of 2025, the Company released six movies that were filmed with IMAX proprietary cameras (Filmed For IMAX):

Sinners , Thunderbolts , Final Destination:

Bloodlines , Mission:

Impossible - The Final Reckoning , How To Train Your Dragon and F1 The Movie.

Filmed For IMAX movies traditionally perform disproportionately well at the box office, and for three of these films ( Sinners , Mission:

Impossible - The Final Reckoning and F1 The Movie ), IMAX delivered approximately 20% or more of the opening weekend domestic box office, despite accounting for only 1% of available screens.

In addition to the level of revenues, Content Solutions segment gross margin is influenced by the costs associated with films and other content exhibited in the period.

These costs can include production, post-production, distribution, and marketing, which are expensed as incurred.

For the three months ended March 31, 2025, gross margin percent was 69% compared to 65% in the prior quarter period.

The increase was due to the higher level of IMAX box office and the profit that incrementally ensues when individual titles generate higher levels of box office.

For the six months ended June 30, 2025, gross margin percent was 67% compared to 55% in the prior quarter period.

This increase was driven by a higher level of IMAX box office, a lower mix of self-produced content expensed compared to the prior period.

Technology Products and Services

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The following table provides information about IMAX Systems installed under sales arrangements and the associated revenue recognized during the three months ended March 31, 2025 and 2024:

Three Months Ended March 31,

The following table provides information about IMAX Systems installed and the associated revenue recognized at that time, except for traditional joint revenue sharing arrangements as revenue is recognized over the lease term, during the six months ended June 30, 2025 and 2024:

Six Months Ended June 30,

(In thousands of U.S.

5 unchanged sentences

Total 26 $ 23,668 16 $ 15,814

Included in the table above are three IMAX Systems that were relocated from their original locations (2024 ― one IMAX System).

Included in the table above are three IMAX Systems that were relocated from their original locations (2024 ― two IMAX Systems).

When a system under a sale or sales-type lease arrangement is relocated, the amount of revenue earned by the Company may vary from transaction to transaction and is usually less than the amount earned for a new sale.

In certain situations when a system is relocated, the original location is upgraded to an IMAX Laser System.

For the three months ended March 31, 2025, Technology Products and Services segment revenue and gross margin increased by $7.4 million, or 17%, and $5.5 million, or 23%, respectively, when compared to the same period in the prior year, The higher level of revenue is primarily driven by a greater number of sales installations and renewals and a higher level of rental revenues, which are box office dependent.

Rental revenues increased by $0.5 million, as a result of growth in GBO from JRSAs, which increased by $14.7 million, or 12%, in the three months ended March 31, 2025 when compared to the prior year comparative period, from $125.4 million to $140.1 million.

For the three months ended March 31, 2025, gross margin percent was 57% compared to 55% in the prior period, which primarily reflects the higher level of revenues, as described above.

For the three months ended March 31, 2025, All Other revenue and gross margin decreased by $0.1 million, or 7%, and $0.7 million, or 56%, respectively, when compared to the same period in 2024, which principally reflects the lower box office performance of the Company’s one owned and operated theater.

For the six months ended June 30, 2025, Technology Products and Services segment revenue and gross margin increased by $12.2 million, or 13%, and $9.9 million, or 20%, respectively, when compared to the same period in the prior year.

The higher level of

revenue is primarily driven by a higher level of rental revenues, which is box office dependent.

Rental revenues increased by $5.2 million, driven by IMAX GBO from joint revenue sharing arrangements which increased by $38.8 million in the six months ended June 30, 2025 when compared to the prior year comparative period, from $226.4 million to $265.2 million.

Also contributing to the increase in revenue was the number of systems recognized under sales and sales-type lease arrangements, per the table above.

The increases in revenue were partially offset by a $4.2 million decrease in revenue contribution from the impact of amendments, renewals and other agreements to existing IMAX Systems arrangements.

For the six months ended June 30, 2025, gross margin percent was 56% compared to 52% in the prior period, which primarily reflects the higher level of revenues, as described above.

For the six months ended June 30, 2025, All Other revenue and gross margin decreased by $1.0 million, and $1.7 million, respectively, when compared to the same period in 2024.

All Other primarily reflects the results of the Company’s Streaming and Consumer Technology business.

Selling, General and Administrative Expenses

The following table presents information about the Company’s Selling, General and Administrative Expenses for the three months ended March 31, 2025 and 2024:

Three Months Ended

March 31, Variance

The following table presents information about the Company’s Selling, General and Administrative Expenses for the six months ended June 30, 2025 and 2024:

Six Months Ended

June 30, Variance

(In thousands of U.S.

5 unchanged sentences

$ 57,182 $ 57,978 $ (796) (1 %)

(1) A portion of share-based compensation expense is recognized within Cost and Expenses Applicable to Revenue, Research and Development and Executive transition costs.

(1) A portion of share-based compensation expense is recognized within Cost and Expenses Applicable to Revenue, and Research and Development.

(Refer to “Capital Stock and Reserves — Share-Based Compensation” in Note 11 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1.)

(2) See “Non-GAAP Financial Measures” for a description of this non-GAAP financial measure and a reconciliation to the most comparable GAAP amount.

For the three months ended March 31, 2025, the higher level of Selling, General and Administrative Expenses year-over-year reflects the timing of industry events, marketing expenses, and higher professional service fees.

For the six months ended June 30, 2025, the lower level of Selling, General and Administrative Expenses year-over-year reflects management’s continued focus on operational efficiencies, including workforce reductions.

Research and Development

For the three months ended March 31, 2025, Research and Development expenses were $1.3 million, representing a decrease of $0.9 million, or 40%, when compared to Research and Development expenses of $2.2 million during the same period in the prior year.

For the six months ended June 30, 2025, Research and Development expenses were $2.9 million, representing a decrease of $1.4 million, or 32%, when compared to Research and Development expenses of $4.2 million during the same period in the prior year.

The reduction year-over-year was primarily driven by the capitalization of film camera costs in accordance with the achievement of technological feasibility in 2024.

1 unchanged sentence

Credit Loss (Reversal) Expense, Net

For the three months ended March 31, 2025, the Company recorded a credit loss reversal of $0.1 million, as compared to a credit loss expense of less than $0.1 million recognized in the prior year.

For the six months ended June 30, 2025, the Company recorded a credit loss reversal of $0.3 million, as compared to a credit loss expense of $0.2 million recognized in the prior year.

Stronger box office performance in the year has contributed to a notable improvement in collections.

The resurgence in theatrical attendance, driven by a robust film slate, has increased and accelerated cash inflows from studio and exhibitor customers.

This trend reflects both the sustained consumer demand for premium cinematic experiences and the effectiveness of our strategic initiatives in global distribution and exhibition.

1 unchanged sentence

(Refer to Note 3 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1).

Interest Expense, net

For the three months ended March 31, 2025, interest expense was $1.8 million, representing a decrease of $0.1 million, or 7%, as compared to $1.9 million during the same period of the prior year.

For the three months ended March 31, 2025 and 2024, interest income was $0.5 million and $0.5 million, respectively.

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

Interest Expense and Interest Income

For the six months ended June 30, 2025, interest expense was $3.7 million, representing a decrease of $0.5 million, or 12%, as compared to $4.2 million during the same period of the prior year primarily due to a lower level of borrowings under the Credit Facility in the current period.

For the six months ended June 30, 2025 and 2024, interest income was $1.7 million and $1.1 million, respectively.

For the six months ended June 30, 2025, the Company recorded an income tax expense of $8.5 million (2024 — tax expense of $1.2 million).

The Company’s effective tax rate of 29.4% for the six months ended June 30, 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.

Non-Controlling Interests

For the three months ended March 31, 2025, the net income attributable to non-controlling interests of the Company’s subsidiaries was $5.8 million, an increase of $3.7 million, when compared to the same period in 2024, primarily due to the higher IMAX box office earned in Greater China.

CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2025 AND 2024

The discussion below summarizes our cash flows from operating, investing, and financing activities as reflected in the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2025 and 2024.

Three Months Ended

For the six months ended June 30, 2025, the net income attributable to non-controlling interests of the Company’s subsidiaries was $6.8 million, an increase of $3.2 million, when compared to the same period in 2024, which reflects a higher level of IMAX box office earned in Greater China.

Restructuring and Other Charges

For the six months ended June 30, 2025, the Company recorded $0.8 million (2024 — $nil) of restructuring and other charges.

These charges are associated with continued strategic initiatives aimed at enhancing operational efficiency, reducing costs, and optimizing the Company’s organization structure.

Specifically, the Company incurred $0.5 million in connection with the implementation of its plan to optimize its organizational structure, including the elimination of redundant roles, addressing spans and layers to capture efficiencies and centralize certain operational roles.

Additionally, the Company incurred $0.3 million of non-recurring fees relating to the 2024 internal asset sale.

CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, 2025 AND 2024

Six Months Ended

(In thousands of U.S.

9 unchanged sentences

$ 8,659 $ 15,352

Net cash provided by the Company’s operating activities increased $17.9 million in the three months ended March 31, 2025, primarily due to a decrease in cash used for working capital expenditures.

Net cash provided by the Company’s operating activities increased $6.1 million in the six months ended June 30, 2025, compared to the corresponding prior year period, primarily due to an increase in the net income earned in the current period.

This increase was partially offset by an decrease in cash provided by working capital expenditures.

(Refer to Note 9 to Condensed Consolidated Financial Statements in Item 1.

for more information on the Company’s change in other operating assets and liabilities.)

Net cash used in investing activities increased $7.5 million in the three months ended March 31, 2025, primarily due to an increase in the level of investment in equipment contributed to the Company’s JRSAs with exhibitor customers and capital expenditures.

Net cash provided by financing activities decreased $18.6 million in the three months ended March 31, 2025, mainly driven by a decrease in net borrowings under the revolving credit facilities and an increase in cash paid for taxes withheld on employee stock awards vested.

No share repurchases were made or dividends paid in the three months ended March 31, 2025.

Net cash used in investing activities increased $6.4 million in the six months ended June 30, 2025, compared to the corresponding prior year period, primarily due to an increase in the level of investment in equipment contributed to the Company’s JRSAs with exhibitor customers and capital expenditures.

In the six months ended June 30, 2025, the Company installed 31 systems under JRSAs compared to 23 systems in the prior year comparative period.

Net cash provided by financing activities decreased $6.1 million in the six months ended June 30, 2025, compared to the corresponding prior year period, mainly driven by a decrease in net borrowings under the revolving credit facilities, an increase in cash paid for taxes withheld on employee stock awards vested, offset by a decease in share repurchases.

LIQUIDITY AND CAPITAL RESOURCES

As of March 31, 2025, the Company’s principal sources of liquidity included:

As of June 30, 2025, the Company’s principal sources of liquidity included:

(i) its balances of cash and cash equivalents of $109.3 million;

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Under the terms of the Company’s typical sale and sales-type lease agreements, the Company receives substantial cash payments before it completes the performance of its contractual obligations.

In addition, as of March 31, 2025, the Company had $250.0 million in available borrowing capacity under its Sixth Amended and Restated Credit Agreement (the “Credit Agreement”), $26.5 million in available borrowing capacity under the IMAX (Shanghai) Multimedia Technology Co., Ltd.

In addition, as of June 30, 2025, the Company had $252.0 million in available borrowing capacity under its Sixth Amended and Restated Credit Agreement (the “Credit Agreement”), $26.5 million in available borrowing capacity under the IMAX (Shanghai) Multimedia Technology Co., Ltd.

(“IMAX Shanghai”) revolving credit facility with the Bank of China (the “Bank of China Facility”), and $27.9 million in available borrowing capacity under IMAX Shanghai’s revolving credit facility with HSBC Bank (China) Company Limited, Shanghai Branch (the “HSBC China Facility”).

On July 14, 2025, the Company entered into the New Credit Agreement, which increases the Company’s borrowing capacity to $375.0 million.

(Refer to “Borrowings — Revolving Credit Facility Borrowings, Net” in Note 6 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1 for a description of the material terms of the Credit Agreement, the Bank of China Facility, and the HSBC Facility.)

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 People’s Republic of China (the “PRC”) (December 31, 2024 — $47.5 million).

The Company’s $109.3 million balance of cash and cash equivalents as of June 30, 2025 (December 31, 2024 — $100.6 million) included $100.9 million in cash held outside of Canada (December 31, 2024 — $85.4 million), of which $61.5 million was held in the People’s Republic of China (the “PRC”) (December 31, 2024 — $47.5 million).

Management reassessed its strategy with respect to the most efficient means of deploying the Company’s capital resources globally and determined that historical earnings of certain foreign subsidiaries in excess of amounts required to sustain business operations would no longer be indefinitely reinvested.

During the three months ended March 31, 2025, no historical earnings from a subsidiary in PRC were distributed (2024 — $nil) and, as a result, no foreign withholding taxes were paid to the relevant tax authorities (2024 — $nil).

As of March 31, 2025, the Company’s Condensed Consolidated Balance Sheets included a deferred tax liability of $12.5 million for the applicable foreign withholding taxes associated with the remaining balance of non-repatriated historical earnings that will not be indefinitely reinvested outside of Canada.

During the six months ended June 30, 2025, no historical earnings from a subsidiary in the PRC were distributed (2024 — $nil) and, as a result, no foreign withholding taxes were paid to the relevant tax authorities (2024 — $nil).

As of June 30, 2025, the Company’s Condensed Consolidated Balance Sheets included a deferred tax liability of $12.5 million for the applicable foreign withholding taxes associated with the remaining balance of non-repatriated historical earnings that will not be indefinitely reinvested outside of Canada.

These taxes will become payable upon the repatriation of any such earnings.

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In particular, the Company’s operating cash flows and cash balances will be adversely impacted if management’s projections of future signings and installations of IMAX Systems and box office performance of IMAX content are not realized.

The Company also has certain significant contractual obligations and commitments that have been disclosed in “Contractual Obligations” in Part II, Item 7 of the Company’s 2024 Form 10-K.

There are no material changes to these obligations and commitments as of June 30, 2025.

Based on the Company’s current cash balances and operating cash flows, management expects to have sufficient capital and liquidity to fund its anticipated operating needs and capital requirements during the next twelve-month period following the date of this report.

CONTRACTUAL OBLIGATIONS

Payments to be made by the Company under contractual obligations as of March 31, 2025 are as follows:

Payments Due by Years

(In thousands of U.S.

Purchase obligations (1)

$ 34,786 $ 32,584 $ 1,747 $ 248 $ 207

Pension obligations (2)

20,298 — 20,298 — —

Operating lease obligations (3)

14,877 3,557 6,365 4,780 175

Credit Facility

50,000 50,000 — — —

Federal Economic Development Loan (4)

1,847 969 878 — —

Convertible Notes (5)

231,725 1,150 230,575 — —

Postretirement benefits obligations

2,338 10 209 207 1,912

$ 355,871 $ 88,269 $ 260,072 $ 5,235 $ 2,294

(1) Represents total payments to be made under binding commitments with suppliers and outstanding payments to be made for supplies ordered, but yet to be invoiced.

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

The SERP has a fixed benefit payable of $20.3 million.

The table above assumes that Mr.

Gelfond will receive a lump sum payment of $20.3 million six months after retirement at the end of the term of his current employment agreement, which expires on December 31, 2025, in accordance with the terms of the SERP, although Mr.

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

(See Note 14 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1.)

(3) Represents total minimum annual rental payments due under the Company’s operating leases.

(4) The Federal Economic Development Loan is repayable over 36 months, with repayments commencing January 2024.

(Refer to “Borrowings — Convertible Notes and Other Borrowings, Net” in Note 6 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1.)

(5) The Convertible Notes 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.

The Convertible Notes will mature on April 1, 2026, unless earlier repurchased, redeemed or converted.

(Refer to “Borrowings — Convertible Notes and Other Borrowings, Net” in Note 6 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1.)

OFF-BALANCE SHEET ARRANGEMENTS

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Actual results may ultimately differ from the Company’s original estimates, as future events and circumstances sometimes do not develop as expected, and the differences may be material.

For more information on the Company’s critical accounting estimates refer to the section entitled “Critical Accounting Estimates” in Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the 2024 Form 10-K.

For more information on the Company’s critical accounting estimates

refer to the section entitled “Critical Accounting Estimates” in Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the 2024 Form 10-K.

RECENTLY ISSUED ACCOUNTING STANDARDS

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(ii) realized and unrealized investment gains or losses;

and (iii) restructuring and other charges, as well as the related tax impact of these adjustments.

(iii) restructuring and other charges;

and (iv) employee retention credits, and as well as the related tax impact of these adjustments.

The Company believes that these non-GAAP financial measures are important supplemental measures that allow management and users of the Company’s financial statements to view operating trends and analyze controllable operating performance on a comparable basis between periods without the after-tax impact of share-based compensation and certain unusual items included in net income attributable to common shareholders.

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Reconciliations of net income attributable to common shareholders and the associated per share amounts to adjusted net income attributable to common shareholders and adjusted net income attributable to common shareholders per diluted share are presented in the tables below.

Three Months Ended March 31,

Three Months Ended June 30,

(In thousands of U.S.

Dollars, except per share amounts)

Per Diluted Share

Net income attributable to common shareholders

$ 11,255 $ 0.20 $ 3,583 $ 0.07

Adjustments (1) :

Share-based compensation

7,128 0.13 6,647 0.12

Unrealized investment gains

(33) — (32) —

Restructuring and other charges

Employee retention credits

(3,827) (0.07) — —

Tax impact on items listed above

(702) (0.01) (452) (0.01)

Adjusted net income (1)

$ 14,607 $ 0.26 $ 9,746 $ 0.18

Weighted average shares outstanding — basic

53,751 52,633

Weighted average shares outstanding — diluted

55,161 53,428

(1) Reflects amounts attributable to common shareholders.

Six Months Ended June 30,

(In thousands of U.S.

Dollars, except per diluted share amounts)

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Restructuring and other charges

Employee retention credits

(3,827) (0.07) — —

Tax impact on items listed above

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(In thousands of U.S.

Three Months Ended March 31, 2025

Three Months Ended June 30, 2025

Reported net income

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(In thousands of U.S.

Dollars) Twelve Months Ended March 31, 2025

Dollars) Twelve Months Ended June 30, 2025

Reported net income

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Three Months Ended

Six Months Ended

June 30, June 30,

(In thousands of U.S.

2025 2024 2025

Total Selling, general and administrative expenses

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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 2. Management’s Discussion and Analysis