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Item 1. Financial Statements

2025-11-19 compared with 2025-08-11 · 186 added, 109 removed, 674 unchanged (30% of the section changed)

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in thousands, except per share amounts) 2025 2024 2025 2024

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Change in fair value of warrant shares liability ( 7,333 ) 65,439 ( 5,923 ) 34,412

Other income 2,119 10 2,230 20

Total other expense ( 1,736 ) ( 34,799 ) ( 5,379 ) ( 34,925 )

LOSS BEFORE INCOME TAXES ( 8,521 ) ( 48,125 ) ( 16,847 ) ( 51,718 )

Other income (expense) 746 ( 24 ) 2,976 ( 4 )

Total other (expense) income ( 10,518 ) 62,141 ( 14,487 ) 27,216

(LOSS) INCOME BEFORE INCOME TAXES ( 17,609 ) 55,268 ( 33,046 ) 3,550

PROVISION FOR INCOME TAXES 282 342 841 608

NET LOSS ( 8,800 ) ( 48,307 ) ( 17,406 ) ( 51,984 )

NET (LOSS) INCOME ( 17,891 ) 54,926 ( 33,887 ) 2,942

Net income attributable to noncontrolling interest — 639 475 1,467

PREFERRED STOCK DIVIDENDS — — — 851

NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS $ ( 9,078 ) $ ( 49,263 ) $ ( 17,881 ) $ ( 53,663 )

Net loss per share attributable to common shareholders - basic and diluted $ ( 0.11 ) $ ( 0.75 ) $ ( 0.23 ) $ ( 1.19 )

NET (LOSS) INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS $ ( 17,891 ) $ 54,287 $ ( 34,362 ) $ 624

Net (loss) income per share attributable to common shareholders:

Basic $ ( 0.22 ) $ 0.73 $ ( 0.44 ) $ 0.01

Diluted $ ( 0.22 ) $ 0.66 $ ( 0.44 ) $ 0.01

Weighted-average common shares outstanding - basic and diluted

Basic 81,724 74,271 78,627 54,939

Diluted 81,724 84,177 78,627 55,546

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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CONDENSED CONSOLIDATED BALANCE SHEETS

September 30,

2025 December 31,

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authorized 170,000,000 shares;

issued and outstanding 48,253,005 shares and 41,274,103 shares at June 30, 2025, and December 31, 2024, respectively

issued and outstanding 76,458,943 shares and 41,274,103 shares at September 30, 2025, and December 31, 2024, respectively

Class B common stock, $ 0.01 par value;

authorized 50,000,000 shares;

issued and outstanding 5,413,197 shares at June 30, 2025, and December 31, 2024

issued and outstanding 5,413,197 shares at September 30, 2025, and December 31, 2024

Class C common stock, $ 0.01 par value;

authorized 30,000,000 shares;

Warrant Shares 32,155 —

Additional paid-in capital 148,276 89,726

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BALANCE, MARCH 31, 2025 41,227,520 $ 412 5,413,197 $ 54 $ 32,155 $ 89,708 — $ ( 36,877 ) $ 20,599 $ 106,051

Net (loss) income — — — — — — ( 9,078 ) 278 ( 8,800 )

Net (loss) income - See Note 2 — — — — — — ( 7,668 ) 278 ( 7,390 )

Issuance of class A to employees, officers and directors, net of withholdings ( 26,053 ) — — — — — — — —

Noncontrolling interest resulting from Estrella transaction 7,051,538 71 — — — 20,806 — ( 20,877 ) —

Warrant shares - See Note 2 — — — — ( 32,155 ) — — — ( 32,155 )

BALANCE, JUNE 30, 2025 48,253,005 $ 483 5,413,197 $ 54 $ — $ 110,514 $ ( 44,545 ) $ — $ 66,506

Net loss — — — — — ( 17,891 ) — ( 17,891 )

Issuance of class A to employees, officers and directors, net of withholdings ( 34,960 ) ( 1 ) — — ( 34 ) — ( 35 )

Issuance of common stock upon warrant exercise 28,205,938 282 — — — 37,796 — 38,078

BALANCE, SEPTEMBER 30, 2025 76,423,983 $ 764 5,413,197 $ 54 $ — $ 148,276 $ ( 62,436 ) $ — $ 86,658

BALANCE, DECEMBER 31, 2023

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BALANCE, JUNE 30, 2024 41,278,034 $ 413 5,413,197 $ 54 $ — $ 89,997 $ ( 76,811 ) $ 18,457 $ 32,110

Net loss — — — — — 54,287 639 54,926

Issuance of class A to employees, officers and directors, net of withholdings ( 51,487 ) — — — ( 29 ) — — ( 29 )

BALANCE, SEPTEMBER 30, 2024 41,226,547 $ 413 5,413,197 $ 54 $ — $ 89,968 $ ( 22,524 ) $ 19,096 $ 87,007

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Six Months Ended June 30,

Nine Months Ended September 30,

(in thousands) 2025 2024

CASH FLOWS FROM OPERATING ACTIVITIES:

Consolidated net loss $ ( 17,406 ) $ ( 51,984 )

Adjustments to reconcile net loss to net cash used in operating activities -

Consolidated net (loss) income $ ( 33,887 ) $ 2,942

Adjustments to reconcile net loss to net cash provided by (used in) operating activities -

Depreciation and amortization 5,150 3,305

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Other liabilities ( 4,753 ) 596

Net cash used in operating activities ( 893 ) ( 24,711 )

Net cash provided by (used in) operating activities 1,938 ( 30,731 )

CASH FLOWS FROM INVESTING ACTIVITIES:

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As a result of the exercise of the Put Right, Estrella became a wholly owned subsidiary of the Company.

On September 5, 2025 the warrant issued in connection with the Company’s acquisition of certain assets of Estrella and its subsidiaries was exercised in exchange for 28,205,938 shares of MediaCo Class A Common Stock, par value $ 0.01 per share.

Emerging Growth Company

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At times, such deposits may be in excess of FDIC insurance limits.

Restricted cash of $ 2.0 million as of June 30, 2025 and December 31, 2024 was held as collateral for a letter of credit entered into in connection with the lease in New York City for our radio operations and corporate offices, which expires in October 2039, and restricted cash of $ 0.5 million as of June 30, 2025 and December 31, 2024 was held for a collateral account related to merchant banking for the Company’s purchase card program and for an office lease security deposit, all included in the line item Deposits and Other in the condensed consolidated balance sheets.

Restricted cash of $ 2.0 million as of September 30, 2025 and December 31, 2024 was held as collateral for a letter of credit entered into in connection with the lease in New York City for our radio operations and corporate offices, which expires in October 2039, and restricted cash of $ 0.0 million as of September 30, 2025 and $ 0.5 million as of December 31, 2024 was held for a collateral account related to merchant banking for the Company’s purchase card program and for an office lease security deposit, all included in the line item Deposits and Other in the condensed consolidated balance sheets.

Fair Value Measurements

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The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs (see Note 5 — Intangible Assets and Goodwill for additional information).

The Company’s Warrant Shares (as defined in Note 3 — Business Combinations) were classified as a liability as of December 31, 2024 for which the fair value was measured on a recurring basis using Level 2 inputs (see Note 6 — Long-Term Debt, Warrants, and Series B Preferred Stock for additional information) and were reclassified to permanent equity during the quarter ended March 31, 2025.

The Company’s Warrant Shares (as defined in Note 4 — Business Combinations) were recorded at fair value and measured using Level 2 inputs during the three and nine months ended September 30, 2025 (see Note 8 — Long-Term Debt, Warrants, and Series B Preferred Stock for additional information).

The warrants were exercised as of September 5, 2025, at which time they were reclassified to permanent equity at fair value on the exercise date.

We have no assets or liabilities for which fair value is measured on a recurring basis using Level 3 inputs.

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The Company believes the current carrying value of its long-term debt approximates its fair value as it is variable rate debt.

As a result of the Estrella Acquisition, the Company recorded $ 28.3 million of goodwill, which accounts for all goodwill on the condensed consolidated balance sheet as of June 30, 2025, and of which $ 8.4 million is allocated to our Video Segment and $ 19.9 million is allocated to our Audio Segment.

As a result of the Estrella Acquisition, the Company recorded $ 28.3 million of goodwill, which accounts for all goodwill on the condensed consolidated balance sheet as of September 30, 2025, and of which $ 8.4 million is allocated to our Video Segment and $ 19.9 million is allocated to our Audio Segment.

ASC Topic 350-20-35 requires the Company to test goodwill for impairment at least annually.

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The level at which we test goodwill for impairment requires us to determine whether the operations below the business segment constitute a self-sustaining business for which discrete financial information is available and segment management regularly reviews the operating results.

In the current period, it was not more likely than not that the fair value of each reporting unit was less than its carrying amount.

There have been no indicators of impairment since we performed our annual impairment assessment as of October 1, 2024.

There have been no indicators of impairment during the nine months ended September 30, 2025 and the Company will perform our annual impairment assessment during the fourth quarter of 2025.

Intangible Assets

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Amounts are written off after all normal collection efforts have been exhausted.

The activity in the allowance for credit losses for the three and six months ended June 30, 2025 and 2024 was as follows:

Three Months Ended June 30, Six Months Ended June 30,

The activity in the allowance for credit losses for the three and nine months ended September 30, 2025 and 2024 was as follows:

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

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These programming rights are amortized based on the estimated number of future showings on a program by program basis over the license term, beginning in the period in which the license period begins and program becomes available for broadcast in accordance with ASC 920, Entertainment - Broadcasters.

Program rights expected to be amortized to expense in the following 12-month period are classified as current assets and program rights payable within the following 12-month period are classified as current liabilities.

All program rights payable are included in accounts payable and accrued expenses as of June 30, 2025.

Amortization expense for the three and six months ended June 30, 2025 was $ 0.2 million and $ 0.6 million, respectively, which is included in operating expenses.

Amortization expense for both the three and six months ended June 30, 2024 was $ 0.8 million.

These programming rights were primarily related to one agreement which was terminated in February 2025.

Production Costs

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In determining the method of amortization and estimated life, we generally use the method and the life that most closely follow the individual film forecast computation method, in accordance with ASC 926, Entertainment - Films.

Program rights expected to be amortized to expense in the following 12-month period are classified as current assets.

Amortization expense for both the three and six months ended June 30, 2025 was $ 0.6 million, which is included in operating expenses.

Amortization expense for both the three and six months ended June 30, 2024 was zero .

Production costs expected to be amortized to expense in the following 12-month period are classified as current assets.

Amortization expense for the three and nine months ended September 30, 2025 was $ 0.2 million and $ 0.8 million, respectively, which is included in operating expenses.

Amortization expense for both the three and nine months ended September 30, 2024 was zero .

Advertising Costs

Advertising costs are expensed when incurred.

Advertising expenses were $ 0.1 million and $ 0.3 million in each of the three and six months ended June 30, 2025 and $ 0.5 million in each of the three and six months ended June 30, 2024, respectively.

Advertising expenses were $ 0.2 million and $ 0.5 million in each of the three and nine months ended September 30, 2025, respectively, and $ 0.5 million and $ 1.0 million in each of the three and nine months ended September 30, 2024, respectively.

Deferred Revenue and Barter Transactions

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The liability for each contract is calculated by determining the cost per guarantee per the original contract, multiplied by the number of deficiency units.

As of June 30, 2025 and December 31, 2024, the makegood liability assumed in the Estrella Acquisition, which is associated with these network sales and contracts, was $ 8.8 million and $ 9.2 million, respectively, and is expected to be recognized at any time but likely not to exceed four years .

During the three and six months ended June 30, 2025, the Company recognized $ 1.2 million and $ 1.7 million, respectively in Revenue.

During the three and six months ended June 30, 2024, the Company recognized $ 0.8 million in Revenue.

As of September 30, 2025 and December 31, 2024, the makegood liability assumed in the Estrella Acquisition, which is associated with these network sales and contracts, was $ 8.7 million and $ 9.2 million, respectively, and is expected to be recognized at any time but likely not to exceed four years .

Barter transactions are recorded at the estimated fair value of the product or service received.

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The appropriate expense or asset is recognized when merchandise or services are used or received.

Barter revenues were $ 0.8 million and $ 0.8 million for the three months ended June 30, 2025 and 2024, respectively.

Barter revenues were $ 1.2 million and $ 1.0 million for the six months ended June 30, 2025 and 2024, respectively Barter expenses were $ 0.8 million and $ 0.8 million for the three months ended June 30, 2025 and 2024, respectively.

Barter expenses were $ 1.2 million and $ 1.0 million for the six months ended June 30, 2025 and 2024, respectively

The makegood revenue, barter revenue and barter expense transactions for the three and nine months ended September 30, 2025 are as follows:

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

Makegood Revenue Recognized $ 547 $ 627 $ 2,260 $ 1,386

Barter Revenue 378 1,035 1,598 2,057

Barter Expenses 378 1,050 1,567 2,058

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period.

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We are currently assessing the impact this standard will have on our consolidated financial statements, including, but not limited to, our income taxes footnote disclosure.

REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

Revision of Q2 2025 Financial Statements

During the third quarter of 2025, the Company determined that its Warrant Shares, originally issued in 2024 and valued at $ 32.2 million as of June 30, 2025, should have been presented as a liability rather than as permanent equity.

Due to the liability classification, there was also a $ 1.4 million mark to market adjustment that should have been recorded in Change in fair value of warrant shares liability in the condensed consolidated statements of operations for the three-month and six-month periods ended June 30, 2025.

As a result, the accompanying unaudited condensed consolidated statement of changes in equity for the three-months ended June 30, 2025, have been restated to reflect this liability presentation of the Warrant Shares, that resulted in a $ 30.7 million decrease in equity.

In accordance with SAB No.

99, Topic 1.M, Materiality, SAB No.

99, Topic 1.N, Considering the Effects of Misstatements when Quantifying Misstatements in the Current Year Financial Statements, and ASC 250, Accounting Changes and Error Corrections , the Company assessed the materiality of this misstatement to its previously issued consolidated financial statements.

Based upon the Company’s evaluation of both quantitative and qualitative factors, the Company concluded this misstatement was immaterial to the Company’s previously issued condensed consolidated financial statements as of and for the periods ended June 30, 2025.

The Company will restate the comparative prior periods included in condensed consolidated financial statements in future filings.

EARNINGS PER SHARE

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Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

Net loss $ ( 8,800 ) $ ( 48,307 ) $ ( 17,406 ) $ ( 51,984 )

Net (loss) income $ ( 17,891 ) $ 54,926 $ ( 33,887 ) $ 2,942

Net income attributable to noncontrolling interests — ( 639 ) ( 475 ) ( 1,467 )

Preferred stock dividends — — — ( 851 )

Net loss attributable to common shareholders for basic and diluted earnings per share ( 9,078 ) ( 49,263 ) ( 17,881 ) ( 53,663 )

Weighted-average shares of common stock outstanding — basic and diluted 79,719 65,415 77,100 45,166

Net (loss) income available to common shareholders ( 17,891 ) 54,287 ( 34,362 ) 624

Net (loss) income attributable to common shareholders for basic earnings per share ( 17,891 ) 54,287 ( 34,362 ) 624

Interest expense related to convertible Emmis promissory note (1)

Net income attributable to noncontrolling interests $ — $ 639 $ — $ —

Net (loss) income attributable to common shareholders for diluted earnings per share $ ( 17,891 ) $ 55,178 $ ( 34,362 ) $ 624

Weighted-average shares of common stock outstanding:

81,724 74,271 78,627 54,939

Dilutive items:

Convertible Emmis promissory note — 2,305 — —

Option agreement shares — 7,052 — —

Restricted stock awards — 549 — 607

Weighted-average shares of common stock outstanding — diluted 81,724 84,177 78,627 55,546

Earnings per share of common stock attributable to common shareholders:

Net loss per share attributable to common shareholders - basic and diluted:

Net (loss) income per share attributable to common shareholders - basic:

$ ( 0.22 ) $ 0.73 $ ( 0.44 ) $ 0.01

Net (loss) income per share attributable to common shareholders - diluted:

$ ( 0.22 ) $ 0.66 $ ( 0.44 ) $ 0.01

(1) The dilutive effect of the convertible Emmis promissory note was determined using the if-converted method, in accordance with which the note is assumed to be converted into common stock at the beginning of the reporting period.

Interest expense, net of any income tax effects, is added back to the numerator of the calculation.

The following convertible equity shares, convertible promissory note shares, option agreement shares and restricted stock awards were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive.

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2025 2024 2025 2024

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See Note 8 — Long-Term Debt, Warrants, and Series B Preferred Stock for further discussion.

First Lien Term Loan

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Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

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Unaudited Pro Forma Financial Information

The following table presents the estimated unaudited pro forma combined results of MediaCo and Estrella for the three and six months ended June 30, 2024, as if the acquisition had occurred on January 1, 2024:

Three Months Ended June 30,

(unaudited) Six Months Ended June 30,

The following table presents the estimated unaudited pro forma combined results of MediaCo and Estrella for the three and nine months ended September 30, 2024, as if the acquisition had occurred on January 1, 2024:

Three Months Ended September 30,

(unaudited) Nine Months Ended September 30,

Net revenues $ 29,859 $ 84,508

Net loss before income taxes ( 57,721 ) ( 67,110 )

Net income (loss) before income taxes 59,858 ( 10,132 )

The supplemental pro forma financial information has been prepared using the acquisition method of accounting and is based on the historical financial information of MediaCo and Estrella.

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INTANGIBLE ASSETS AND GOODWILL

As of June 30, 2025 and December 31, 2024, intangible assets and goodwill consisted of the following:

June 30, 2025 December 31, 2024

As of September 30, 2025 and December 31, 2024, intangible assets and goodwill consisted of the following:

September 30, 2025 December 31, 2024

Indefinite-lived intangible assets

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Definite-lived intangibles

The following table presents the weighted-average useful life at June 30, 2025, and the gross carrying amount and accumulated amortization for each major class of definite-lived intangible assets at June 30, 2025 and December 31, 2024:

June 30, 2025 December 31, 2024

The following table presents the weighted-average useful life at September 30, 2025, and the gross carrying amount and accumulated amortization for each major class of definite-lived intangible assets at September 30, 2025 and December 31, 2024:

September 30, 2025 December 31, 2024

Weighted Average Remaining Useful Life

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The customer relationships and time brokerage agreements (Other) were acquired as part of the Estrella Acquisition.

Total amortization expense from definite-lived intangible assets for each of the three and six months ended June 30, 2025 and 2024 and included in the depreciation and amortization line item in the condensed consolidated statements of operations was as follows:

Total amortization expense from definite-lived intangible assets for each of the three and nine months ended September 30, 2025 and 2024 and included in the depreciation and amortization line item in the condensed consolidated statements of operations was as follows:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

Amortization expense $ 720 $ 836 $ 2,287 $ 1,768

The Company estimates amortization expense each of the next five years as follows:

The Company estimates amortization expense for each of the next five years as follows:

Year ending December 31, Amortization Expense

2025 (from July 1) $ 1,440

2025 (from October 1) $ 720

After 2029 3,121

Total $ 10,638

PROGRAMMING RIGHTS

Long-term program rights assets are classified as noncurrent acquired programming rights.

The Company did not have any long-term program rights liabilities as of September 30, 2025.

All program rights payables are included in accounts payable and accrued expenses as of September 30, 2025.

Amortization expense for the three and nine months ended September 30, 2025, was $ 0.2 million and $ 0.8 million, respectively, which is included in operating expenses.

Amortization expense for the three and nine months ended September 30, 2024, was $ 0.9 million and $ 1.7 million, respectively.

These programming rights were primarily related to one agreement which was terminated in February 2025.

The Company evaluates programming rights for impairment whenever indicators of loss are present.

No impairment was recorded during the periods presented.

The Company estimates amortization expense for each of the next five years as follows:

Year ending December 31, Amortization Expense

2025 (from October 1) $ 215

Thereafter $ 7

Sublicense Agreement

On July 3, 2025, the Company entered into a three-year sublicense agreement with a programming syndicate to obtain non-exclusive Spanish-language broadcast and distribution rights to certain live sporting events.

The sublicense covers the 2025-26, 2026-27, and 2027-28 seasons within the United States and Canada.

Under the agreement, the syndicate provides the live clean feeds of these sporting events and related highlights, and the Company is permitted to air and monetize such programming across its linear and digital platforms.

The Company is obligated to pay fixed license fees totaling $ 7.2 million over the term of the contract, payable in monthly installments during each season.

Additional consideration is due for playoff events and for per-event production services.

The Company also agreed to provide the syndicate $ 1.0 million per season of promotional airtime, measured at fair value, in lieu of cash consideration.

The sublicense expires following completion of the 2027-28 season and is non-renewable except by mutual agreement.

Promotional airtime expenses were $ 0.3 million, license fees expensed were $ 0.6 million and production costs expensed were $ 0.2 million for the three and nine months ended September 30, 2025.

Future minimum license fee commitments under the sublicense agreement are as follows:

2025 (from October 1) $ 284

Total remaining future license commitments $ 6,584

The Company generates revenue from the sale of services including, but not limited to:

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The liability for each contract is calculated by determining the cost per guarantee per the original contract, multiplied by the number of deficiency units.

As of June 30, 2025, the makegood liability which is associated with these network sales and contracts was $ 8.8 million and is expected to be recognized at any time but likely not to exceed four years and is included in Deferred revenue in the condensed consolidated financial statements.

As of September 30, 2025, the makegood liability which is associated with these network sales and contracts was $ 8.7 million and is expected to be recognized at any time but likely not to exceed four years and is included in Deferred revenue in the condensed consolidated financial statements.

We do not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less.

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The following table presents the Company's revenues disaggregated by revenue source:

Three Months Ended June 30, 2025

Three Months Ended September 30, 2025

Audio Video Consolidated

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Total net revenues $ 13,550 $ 21,848 $ 35,398

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Audio Video Consolidated

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Total net revenues $ 16,751 $ 13,108 $ 29,859

Six Months Ended June 30, 2025

Nine Months Ended September 30, 2025

Audio Video Consolidated

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Total net revenues $ 42,478 $ 52,195 $ 94,673

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Audio Video Consolidated

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LONG-TERM DEBT, WARRANTS, AND SERIES B PREFERRED STOCK

Long-term debt, Warrant shares, and Series B Preferred Stock was comprised of the following at June 30, 2025 and December 31, 2024:

June 30, 2025 December 31, 2024

Long-term debt, Warrant shares, and Series B Preferred Stock was comprised of the following at September 30, 2025 and December 31, 2024:

September 30, 2025 December 31, 2024

First Lien Term Loans $ 45,000 $ 45,000

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The first of such Delayed Draw Term Loans of $ 5.0 million was made on May 2, 2024 and the second of such Delayed Draw Term Loans of $ 5.0 million was made on July 17, 2024.

As of June 30, 2025, there are no available borrowings on the Delayed Draw Term Loans.

As of September 30, 2025, there are no available borrowings on the Delayed Draw Term Loans.

In September 2024, the Company entered into the First Amendment of the First Lien Credit Agreement with White Hawk Capital Partners, LP, which provided for $ 7.5 million of additional delayed draw term loans (the “Additional Delayed Draw Term Loans”), subject to compliance with certain debt covenants, for Delayed Draw Term Loans, and waived the requirement for mandatory prepayment of any net proceeds received as a result of any equity issuances, up to $ 7.3 million.

A fee of $ 0.3 million was paid in conjunction with entering into this amendment.

As of June 30, 2025, there are no available borrowings on the Additional Delayed Draw Term Loans and no amounts have been drawn.

As of September 30, 2025, there are no available borrowings on the Additional Delayed Draw Term Loans and no amounts have been drawn.

The Initial Term Loan will mature on April 17, 2029, and each Delayed Draw Term Loan will mature on the date that is two years after the initial drawing of such Delayed Draw Term Loan.

Loans under the First Lien Credit Agreement are subject to monthly interest payments at a rate of SOFR + 6.00 %.

Subsequent to the quarter, the Company obtained a support letter indicating the intention and the ability to provide a source of funding to enable the Company to meet its obligations as they become due under the delayed draw term loans with WhiteHawk Capital Partners, LP through at least one year and a day beyond November 30, 2025.

Second Lien Term Loan

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See Note 4 - Business Combinations for additional information.

Further, in connection with the closing of the Equity Purchase Agreement on May 1, 2025, the Warrants were reclassified to a liability .

The Warrant terminates September 6, 2025, six months from the date shareholder approval was obtained, at which point, to the extent not fully exercised, the Warrant shall be deemed automatically exercised.

For the three months ended March 31, 2025, the Company reclassified the Warrant from a liability classification to equity classification.

Subsequent to shareholder approval, the Warrant is now accounted for as permanent equity.

Based on amounts outstanding at June 30, 2025, mandatory principal payments of long-term debt and preferred stock for the next five years and thereafter are summarized below:

Based on amounts outstanding at September 30, 2025, mandatory principal payments of long-term debt and preferred stock for the next five years and thereafter are summarized below:

Year ended December 31, First Lien Term Loans Second Lien Term Loan Series B Preferred Stock Total Payments

Remainder of 2025 (from July 1) $ — $ — $ — $ —

Remainder of 2025 (from October 1) $ — $ — $ — $ —

2026 10,000 — — 10,000

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COMMITMENTS AND CONTINGENCIES

The Company is subject to certain contingent liabilities arising in the normal course of business.

These include guarantees, indemnifications, and other arrangements that could require the Company to make payments to third parties under certain circumstances.

The Company has $ 6.6 million in off-balance sheet arrangements (see Note 5 — Programming Rights for additional information).

As of September 30, 2025, management has evaluated all known contingent matters and believes that any potential losses that may arise from such arrangements are not probable or are not reasonably estimable.

Accordingly, no liability has been recorded in the accompanying financial statements.

Legal Matters

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In the opinion of management of the Company, however, there are no legal proceedings pending against the Company that we believe are likely to have a material adverse effect on the Company.

The effective tax rate for the six months ended June 30, 2025 and 2024 was ( 3 )% and ( 1 )%, respectively.

Our effective tax rate for the six months ended June 30, 2025 differs from the statutory tax rate primarily due to the recognition of additional valuation allowance.

The effective tax rate for the three months ended September 30, 2025 and 2024 was ( 2 )% and 1 %, respectively.

The effective tax rate for the nine months ended September 30, 2025 and 2024 was ( 3 )% and 17 %, respectively.

Our effective tax rate for the three and nine months ended September 30, 2025 differs from the statutory tax rate primarily due to the recognition of additional valuation allowance.

ASC Subtopic 740-10 clarified the accounting for uncertainty in income taxes by prescribing a recognition threshold and measurement attribute of the financial statement recognition and measurement of a tax position taken or expected to be taken within a tax return.

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Additionally, we recognize accrued interest and penalties related to unrecognized tax benefits as components of our income tax provision.

As of June 30, 2025, the amount of interest accrued was approximately $ 82 thousand, which did not include the federal tax benefit of interest deductions.

As of September 30, 2025, the amount of interest accrued was approximately $ 91 thousand, which did not include the federal tax benefit of interest deductions.

The Company is reviewing a tax matter that could affect the characterization or timing of certain tax items.

Although the evaluation is not yet complete, management does not believe that the matter requires recognition of a liability or adjustment to the current tax provision.

The Company will reassess the matter as additional information is available.

We have operating leases for office space and tower space expiring at various dates through December 2047 and finance leases for broadcast tower space expiring in March 2029.

8 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

2 unchanged sentences

Right-of-use assets obtained in exchange for additional operating lease liabilities from lease modification — — 457 —

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Weighted average remaining lease term - operating leases (in years) 12.3 12.8

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

1 unchanged sentence

Cash flows from finance leases 194 187 574 311

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Weighted average remaining lease term - finance leases (in years) 3.5 4.2

Weighted average discount rate - finance leases 11.3 % 11.3 %

As of June 30, 2025, the annual minimum lease payments of our operating lease liabilities were as follows:

As of September 30, 2025, the annual minimum lease payments of our operating and finance lease liabilities were as follows:

Year ending December 31,

2025 (from July 1)

Operating Leases Finance Leases

2025 (from October 1)

$ 1,762 $ 194

2026 7,145 799

2027 6,987 831

2028 6,937 864

2029 6,697 218

After 2029 56,849 —

2 unchanged sentences

Total recorded operating lease liabilities $ 43,121 $ 2,403

As of June 30, 2025, the annual minimum lease payments of our finance lease liabilities were as follows:

Year ending December 31,

2025 (from July 1) $ 389

Total lease payments 3,101

Less imputed interest ( 573 )

Total recorded finance lease liabilities $ 2,528

RELATED PARTY TRANSACTIONS

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The Emmis Convertible Promissory Note matured on November 25, 2024 and was settled in cash.

The Company recognized interest expense of $ 0.2 million and $ 0.4 million related to the Emmis Convertible Promissory Note for the three and six months ended June 30, 2024.

The Company recognized interest expense of $ 0.3 million and $ 0.7 million related to the Emmis Convertible Promissory Note for the three and nine months ended September 30, 2024.

Convertible Preferred Stock

3 unchanged sentences

Pursuant to the Articles of Amendment that established the terms of the Series A preferred stock, issued and outstanding shares of Series A preferred stock accrued cumulative dividends, payable in kind, at an annual rate equal to the interest rate on any senior debt of the Company, or if no senior debt is outstanding, 6 %, plus additional increases of 1 % on December 12, 2020 and each anniversary thereof.

Dividends on Series A preferred stock held by SG Broadcasting were $ 0.1 million and $ 0.9 million for the three and six months ended June 30, 2024.

Dividends on Series A preferred stock held by SG Broadcasting were $ 0.0 million and $ 0.9 million for the three and nine months ended September 30, 2024.

Second Lien Term Loan

On April 17, 2024, in connection with the consummation of the Estrella Acquisition, the Company entered into a $ 30.0 million second lien term loan credit facility (the “Second Lien Credit Agreement” or the “2L Term Loan”) with HPS Investment Partners, LLC (“HPS”), as administrative and collateral agent, and certain financial institutions affiliated with HPS.

HPS is a significant shareholder of the Company and, as such, the Second Lien Credit Agreement constitutes a related-party transaction.

The Second Lien Credit Agreement was recorded at its fair value of $ 26.5 million on April 17, 2024, and will be accreted up to its principal balance over the term of the loan.

The 2L Term Loan bears interest at a rate of SOFR + 6.00 %, which may be paid-in-kind (“PIK”) at the Company’s election.

During 2024, the Company elected to PIK the 6.00 % spread monthly.

Interest expense recognized on the 2L Term Loan, including both cash and PIK interest, totaled approximately $ 0.9 million and $ 2.5 million for the three and nine months ended September 30, 2025, respectively, and $ 0.9 million and $ 1.6 million for the three and nine months ended September 30, 2024, respectively.

The outstanding balance owed to HPS as of September 30, 2025, was $ 29.8 million, inclusive of PIK interest accreted to principal.

Additional details regarding the Second Lien Credit Agreement are provided in Note 8 — Long-Term Debt, Warrants, and Series B Preferred Stock

Consulting Agreements & Other Activity

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One agreement may be terminated at any time by either party and is billed at $ 18,000 per month, plus expenses.

For the three and six months ended June 30, 2024, $ 0.1 million and $ 0.3 million of fees were incurred related to these agreements.

For the three and nine months ended September 30, 2024, zero and $ 0.4 million of fees were incurred related to these agreements.

These agreements were terminated as of September 30, 2024.

In March 2024, we made payments of $ 15,000 to the National Association of Investment Companies, of which a member of our board of directors is the President & CEO.

On October 29, 2024, the Company and Standard Media Group LLC (“SMG”) entered into an Employee Leasing Agreement, effective as of October 1, 2024 (the “Leasing Agreement”).

On October 29, 2024, the Company and Standard Media Group LLC (“SMG”) a wholly owned subsidiary of Standard General, entered into an Employee Leasing Agreement, effective as of October 1, 2024 (the “Leasing Agreement”).

Under the Leasing Agreement, the Company will obtain the services of several SMG employees to serve various roles for the Company, including with respect to the legal, digital products, broadcast IT, and news operations function.

The Leasing Agreement is an at-cost arrangement, with the Company paying only for a percentage of the actual cost of employing each leased employee, with no markup or service fees above the Company’s share of the actual fully-loaded cost of each leased employee.

For the three and six months ended June 30, 2025, $ 0.2 million and $ 0.3 million of fees were incurred related to this agreement and $ 0.3 million was unpaid for both the three and six months ended June 30, 2025.

For the three and nine months ended September 30, 2025, $ 0.2 million and $ 0.5 million of fees were incurred related to this agreement and $ 0.5 million was unpaid for both the three and nine months ended September 30, 2025.

On April 17, 2025, the Company and Paducah Television Operations LLC (“PTO”), a subsidiary of SMG, entered into a Support Agreement, effective as of April 17, 2025 (the “PTO Support Agreement”) and continues for a term of six months unless terminated earlier by either party with 30 days written notice.

On November 5, 2025, an amendment was entered into to extend the term of this agreement for an additional 12 months.

Under the PTO Support Agreement, the Company will provide operational support to PTO, including, but not limited to, finance and legal assistance, human resources, sales, and production of certain marketing materials.

In return for providing these services, the Company will receive payment at the mutually agreed upon rate.

For the three and six months ended June 30, 2025, $ 0.6 million of fees were earned related to this agreement and is recorded in other income on the condensed consolidated statements of operations.

$ 0.6 million of these fees were still owed to the Company as of June 30, 2025.

For the three and nine months ended September 30, 2025, $ 1.2 million and $ 1.8 million of fees were earned related to this agreement and is recorded in other income on the condensed consolidated statements of operations.

$ 1.8 million of these fees were still owed to the Company as of September 30, 2025.

SEGMENT INFORMATION

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The accounting policies as described in the Summary of Significant Accounting Policies included in Note 1 to these condensed consolidated financial statements are applied consistently across segments.

Three Months Ended June 30, 2025 Audio Video Corporate and other (1)

Three Months Ended September 30, 2025 Audio Video Corporate and other (1)

Net revenues $ 13,550 $ 21,848 $ — $ 35,398

3 unchanged sentences

2 ( 2 ) 1,341 1,341

Operating income (loss) $ ( 1,549 ) $ ( 3,682 ) $ ( 1,554 ) $ ( 6,785 )

Three Months Ended June 30, 2024 Audio Video Corporate and other (1)

Operating loss $ ( 1,800 ) $ ( 3,950 ) $ ( 1,341 ) $ ( 7,091 )

Three Months Ended September 30, 2024 Audio Video Corporate and other (1)

Net revenues $ 16,751 $ 13,108 $ — $ 29,859

3 unchanged sentences

— — 2,319 2,319

Operating loss $ ( 2,286 ) $ ( 7,595 ) $ ( 3,445 ) $ ( 13,326 )

Six Months Ended June 30, 2025 Audio Video Corporate and other (1)

Operating income (loss) $ 178 $ ( 4,732 ) $ ( 2,319 ) $ ( 6,873 )

Nine Months Ended September 30, 2025 Audio Video Corporate and other (1)

Net revenues $ 42,478 $ 52,195 $ — $ 94,673

3 unchanged sentences

144 — 4,488 4,632

Operating income (loss) $ ( 854 ) $ ( 7,467 ) $ ( 3,147 ) $ ( 11,468 )

Six Months Ended June 30, 2024 Audio Video Corporate and other (1)

Operating loss $ ( 2,654 ) $ ( 11,417 ) $ ( 4,488 ) $ ( 18,559 )

Nine Months Ended September 30, 2024 Audio Video Corporate and other (1)

Net revenues $ 40,670 $ 22,097 $ — $ 62,767

10 unchanged sentences

Total Assets Audio Video Corporate and other (3)

June 30, 2025 $ 186,465 $ 125,749 $ 2,936 $ 315,150

September 30, 2025 $ 174,652 $ 138,494 $ 6,245 $ 319,391

December 31, 2024 198,310 122,748 4,443 325,501

1 unchanged sentence

Corporate and other assets primarily include cash and cash equivalents.

SUBSEQUENT EVENTS

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted and includes a variety of changes to U.S.

income tax and related laws.

Among other things, the OBBBA makes changes to certain business-related exclusions, deductions and credits.

The effect of the OBBBA will be recorded in the third quarter of fiscal 2025, as a change in tax law is accounted for in the period of enactment.

The new legislation has multiple effective dates, with certain provisions effective in 2025 and others in the future.

While the Company continues to assess the impact of the tax provisions of the OBBBA on its condensed consolidated financial statements, the Company currently believes that the tax provisions of the legislation are not expected to have a material impact on the Company’s financial position or statement of operations.

On August 8, 2025, the Company’s shareholders approved the 2025 Equity Incentive Plan (“Plan”), authorizing the issuance of up to five million shares of Class A common stock.

The Plan replaces the 2020 and 2021 Equity Incentive Plans.

The new Plan includes provisions for stock options, restricted stock units, and performance-based awards.

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