What changed in this filing

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Item 1. Financial Statements

2026-08-14 compared with 2026-05-15 · 214 added, 86 removed, 465 unchanged (39% of the section changed)

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

(in thousands, except per share amounts) 2026 2025 2026 2025

9 unchanged sentences

Interest expense, net ( 4,029 ) ( 3,855 ) ( 7,969 ) ( 7,609 )

Change in fair value of warrant shares liability — 1,410 — 1,410

Other income, net 543 2,119 4,222 2,230

48 unchanged sentences

authorized 170,000,000 shares;

issued and outstanding 76,304,838 shares and 76,307,330 shares at March 31, 2026, and December 31, 2025, respectively

issued and outstanding 76,899,738 shares and 76,307,330 shares at June 30, 2026, and December 31, 2025, respectively

Class B common stock, $ 0.01 par value;

authorized 50,000,000 shares;

issued and outstanding 5,413,197 shares at March 31, 2026, and December 31, 2025

issued and outstanding 5,413,197 shares at June 30, 2026, and December 31, 2025

Class C common stock, $ 0.01 par value;

17 unchanged sentences

BALANCE, MARCH 31, 2026 76,304,838 $ 763 5,413,197 $ 54 $ — $ 139,176 $ ( 104,140 ) $ — $ 35,853

Net loss — — — — — — ( 8,613 ) — ( 8,613 )

Stock-based compensation expense — — — — — 1,017 — — 1,017

Issuance of class A to employees, officers and directors, net of withholdings 594,900 6 — — — ( 6 ) — — —

Equity Clawback (Note 12)

— — — — — 385 — — 385

BALANCE, JUNE 30, 2026 76,899,738 $ 769 5,413,197 $ 54 $ — $ 140,572 $ ( 112,753 ) $ — $ 28,642

BALANCE, DECEMBER 31, 2024

41,274,103 $ 413 5,413,197 $ 54 $ — $ 89,726 $ ( 28,074 ) $ 20,402 $ 82,521

Net loss — — — — — — ( 8,803 ) 197 ( 8,606 )

Net (loss) income — — — — — — ( 8,803 ) 197 ( 8,606 )

Sale of class A common shares 7,240 — — — — 8 — — 8

3 unchanged sentences

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 — — — — — — ( 7,668 ) 278 ( 7,390 )

Stock-based compensation expense — — — — — — — — —

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 — — — — ( 32,155 ) — — — ( 32,155 )

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

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

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended March 31,

Six Months Ended June 30,

(in thousands) 2026 2025

1 unchanged sentence

Consolidated net loss $ ( 17,981 ) $ ( 15,996 )

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

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

Depreciation and amortization 3,019 3,466

1 unchanged sentence

Amortization of fair value debt adjustments 1,533 1,126

Noncash change in warrant shares — ( 1,410 )

Noncash interest expense 3,023 2,865

12 unchanged sentences

Operating lease liabilities ( 852 ) ( 820 )

Income taxes 330 2,826

Other liabilities ( 1,555 ) ( 4,635 )

Net cash (used in) provided by operating activities ( 2,035 ) 2,057

Net cash used in operating activities ( 2,769 ) ( 893 )

CASH FLOWS FROM INVESTING ACTIVITIES:

2 unchanged sentences

Proceeds from the sale of property and equipment 551 —

Net cash provided by (used in) investing activities 172 ( 55 )

Net cash used in investing activities ( 250 ) ( 277 )

CASH FLOWS FROM FINANCING ACTIVITIES:

37 unchanged sentences

The significant accounting policies applied in preparing these condensed consolidated financial statements are consistent with those described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (“fiscal year 2025”), filed with the SEC on March 31, 2026, except as otherwise disclosed herein.

There have been no significant changes to the Company’s significant accounting policies during the three months ended March 31, 2026.

There have been no significant changes to the Company’s significant accounting policies during the six months ended June 30, 2026.

Cash, Cash Equivalents and Restricted Cash

Restricted cash of $ 2.0 million as of March 31, 2026 and December 31, 2025 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.

Restricted cash of $ 2.0 million as of June 30, 2026 and December 31, 2025 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.

The Company may be eligible to reduce the required security deposit in future periods upon satisfaction of certain conditions under the lease.

Allowance for Credit Losses

The activity in the allowance for credit losses for the three months ended March 31, 2026 and 2025 was as follows:

Three Months Ended March 31,

The activity in the allowance for credit losses for the three and six months ended June 30, 2026 and 2025 was as follows:

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

2026 2025 2026 2025

Beginning Balance $ 1,222 $ 872 $ 1,671 $ 1,079

3 unchanged sentences

Fair Value Measurements

The Company’s fair value hierarchy classification of financial instruments measured at fair value on a recurring basis has not changed during the three months ended March 31, 2026.

The Company’s fair value hierarchy classification of financial instruments measured at fair value on a recurring basis has not changed during the three and six months ended June 30, 2026.

The carrying value of the Company’s long-term debt approximates fair value due to its variable interest rate structure.

2 unchanged sentences

The Company evaluates goodwill and indefinite-lived intangible assets for impairment annually, or more frequently if events or changes in circumstances indicate potential impairment.

No impairment charges were recorded during the three months ended March 31, 2026 and 2025.

No impairment charges were recorded during the three and six months ended June 30, 2026 and 2025.

Stock-based Compensation Costs

Stock-based compensation expense totaled $ 1.0 million for both the three and six months ended June 30, 2026, compared with $ 0.0 million and $ 0.0 million, respectively, for the corresponding periods in 2025.

The increase in stock-based compensation expense was primarily attributable to immediately vesting equity awards granted during the current year, resulting in increased compensation expense recognized over the requisite service periods.

The methods and assumptions used in the determination of the fair value of stock-based awards are consistent with those described in the Company’s Form 10-K for fiscal 2025.

Production Costs

Amortization expense for the three months ended March 31, 2026 and 2025 was $ 0.2 million and zero , respectively, which is included in operating expenses.

Amortization expense included in operating expenses was $ 0.9 million and $ 1.1 million for the three and six months ended June 30, 2026 and $ 0.6 million for both the three and six months ended June 30, 2025.

Advertising Costs

Advertising costs are expensed when incurred.

Advertising expenses were $ 0.3 million and $ 0.1 million as of March 31, 2026 and 2025, respectively.

Advertising expenses were $ 0.1 million and $ 0.4 million for the three and six months ended June 30, 2026 and $ 0.1 million and $ 0.3 million for the three and six months ended June 30, 2025.

Deferred Revenue and Barter Transactions

Deferred revenue includes makegood liabilities associated with network sales contracts and deferred barter transactions.

As of March 31, 2026 and December 31, 2025, the makegood liability balance was $ 6.3 million and $ 7.7 million, respectively.

As of June 30, 2026 and December 31, 2025, the makegood liability balance was $ 5.1 million and $ 7.7 million, respectively.

The makegood liability is expected to be recognized over various periods not anticipated to exceed four years .

The makegood liability account activity as of March 31, 2026 and 2025, and the barter revenue and barter expense transactions for the three months ended March 31, 2026 and 2025 are as follows:

March 31, 2026 March 31, 2025

The makegood liability account activity and the barter revenue and barter expense transactions for the three and six months ended June 30, 2026 and 2025, are as follows:

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Beginning Makegood Liability Balance $ 6,251 $ 9,408 $ 7,651 $ 9,221

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Barter Revenue $ 575 $ 782 $ 1,061 $ 1,221

11 unchanged sentences

The accompanying condensed consolidated financial statements are prepared in accordance with GAAP applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

As of March 31, 2026, the Company has near-term debt maturities, a working capital deficit, and liquidity constraints.

As of June 30, 2026, the Company has near-term debt maturities, a working capital deficit, and liquidity constraints and the potential for future violations of financial covenants under its credit agreements.

Management evaluated these conditions in accordance with applicable accounting guidance and determined that, absent the successful execution of its plans, substantial doubt exists about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued.

The Company’s failure to satisfy the Audio Adjusted EBITDA covenant for the quarter ended June 30, 2026 was waived by the applicable lender;

however, the waiver applies only to the covenant period ended June 30, 2026 and does not extend to subsequent covenant periods.

Accordingly, the Company may be required to obtain additional waivers or amendments to its credit agreements if it fails to satisfy applicable financial covenants in future periods.

Management has concluded that our ability to continue as a going concern is dependent on our ability to execute our business plan and/or implement other strategic options.

2 unchanged sentences

The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

Recent Accounting Pronouncements Implemented

In July 2025, the FASB issued ASU 2025‑05, Financial Instruments—Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets.

The amendment provides a practical expedient for estimating expected credit losses on current accounts receivable and current contract assets arising from revenue transactions.

Under the expedient, an entity may assume that current conditions at the balance‑sheet date remain constant over the remaining life of these assets, simplifying the application of the current expected credit loss model.

ASU 2025‑05 is effective for annual periods beginning after December 15, 2025, and is to be applied on a prospective basis.

Early adoption is permitted.

The Company adopted ASU 2025-05 effective January 1, 2026.

There was no material impact to the Company’s unaudited condensed consolidated financial statements as a result of adopting ASU 2025-05.

Recent Accounting Pronouncements Not Yet Implemented

5 unchanged sentences

The Company is currently evaluating this guidance and its impact on the Company's condensed consolidated financial statements and financial statement disclosures.

In July 2025, the FASB issued ASU 2025‑05, Financial Instruments—Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets.

The amendment provides a practical expedient for estimating expected credit losses on current accounts receivable and current contract assets arising from revenue transactions.

ASU 2025‑05 is effective for annual periods beginning after December 15, 2025, and is to be applied on a prospective basis.

Early adoption is permitted.

The Company is evaluating whether to elect the practical expedient;

however, based on the short‑term nature of its advertising receivables and historical collection patterns, the Company does not expect adoption of this guidance to have a material impact on its condensed consolidated financial statements.

REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

Revision of Q2 2025 Financial Statements

As discussed in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2025, 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 revised to reflect this liability presentation of the Warrant Shares.

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 following table details the impact of the misstatements and provides revisions to the impacted financial statement line items in the previously-issued condensed consolidated statements of operations for the periods presented (in thousands, except per share data):

Three Months Ended

June 30, 2025 Six Months Ended

June 30, 2025

As reported Adjustment As revised As reported Adjustment As revised

Change in fair value of warrant shares liability $ — $ 1,410 $ 1,410 $ — $ 1,410 $ 1,410

Total other expense ( 1,736 ) 1,410 ( 326 ) $ ( 5,379 ) $ 1,410 $ ( 3,969 )

LOSS BEFORE INCOME TAXES AND EQUITY METHOD INVESTMENTS ( 8,521 ) 1,410 ( 7,111 ) ( 16,847 ) 1,410 ( 15,437 )

LOSS BEFORE EQUITY METHOD INVESTMENTS ( 8,800 ) 1,410 ( 7,390 ) ( 17,406 ) 1,410 ( 15,996 )

NET LOSS ( 8,800 ) 1,410 ( 7,390 ) ( 17,406 ) $ 1,410 ( 15,996 )

NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS ( 9,078 ) 1,410 ( 7,668 ) ( 17,881 ) $ 1,410 ( 16,471 )

Net loss per share attributable to common shareholders - basic and diluted ( 0.11 ) 0.01 ( 0.10 ) ( 0.23 ) $ 0.02 ( 0.21 )

The following table details the impact of the misstatements and provides revisions to the impacted financial statement line items in the

previously-issued condensed consolidated statements of changes in equity for the periods presented (in thousands):

Three Months Ended

June 30, 2025

As reported Adjustment As revised

Net (loss) income ( 8,800 ) 1,410 ( 7,390 )

Warrant shares 32,155 ( 32,155 ) —

Balance, June 30, 2025 $ 97,251 $ ( 30,745 ) $ 66,506

The following table details the impact of the misstatements and provides revisions to the impacted financial statement line items in the

previously-issued condensed consolidated statements of cash flows for the periods presented (in thousands):

Six Months Ended

June 30, 2025

As reported Adjustment As revised

Consolidated net loss $ ( 17,406 ) $ 1,410 $ ( 15,996 )

Noncash change in warrant shares — ( 1,410 ) ( 1,410 )

EARNINGS PER SHARE

7 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Net loss $ ( 8,613 ) $ ( 7,390 ) $ ( 17,981 ) $ ( 15,996 )

Net loss attributable to noncontrolling interests — ( 197 )

Net income attributable to noncontrolling interests — ( 278 ) — ( 475 )

Net loss attributable to common shareholders for basic and diluted earnings per share $ ( 8,613 ) $ ( 7,668 ) $ ( 17,981 ) $ ( 16,471 )

3 unchanged sentences

The following items were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive.

Restricted stock awards excluded from the calculation include 474,302 shares underlying awards that vested but were not issued due to the Company's inability to fund the employee tax withholding obligations associated with such awards.

Three Months Ended

June 30, Six Months Ended

(in thousands) 2026 2025 2026 2025

8 unchanged sentences

Contributions are accounted for as capital contributions and included in the carrying value of the investment.

As of March 31, 2026, the Company has contributed $ 0.3 million to the Investee.

As of June 30, 2026, the Company has contributed $ 0.6 million to the Investee.

The Company has remaining funding commitments of $ 0.4 million, under the agreement.

Under the operating agreement, the Company is allocated 100 % of the Investee’s profits and losses until recovery of its initial capital contributions, after which profits and losses are allocated 60 % to the Company and 40 % to eMedia.

During the three months ended March 31, 2026, the Company recognized losses of $ 0.3 million which is included in equity loss in investments in the condensed consolidated statements of operations.

This has reduced the investment in the Investee balance to zero as of March 31, 2026.

During the three and six months ended June 30, 2026, the Company recognized losses of $ 0.4 million and $ 0.6 million , respectively, which is included in equity loss in investments in the condensed consolidated statements of operations.

This has reduced the investment in the Investee balance to zero as of June 30, 2026.

No cash distributions were received during the period.

1 unchanged sentence

INTANGIBLE ASSETS AND GOODWILL

As of March 31, 2026 and December 31, 2025, intangible assets and goodwill consisted of the following:

March 31, 2026 December 31, 2025

As of June 30, 2026 and December 31, 2025, intangible assets and goodwill consisted of the following:

June 30, 2026 December 31, 2025

Goodwill $ 8,403 $ 8,403

7 unchanged sentences

Definite-lived intangibles

The following table presents the weighted-average useful life at March 31, 2026, and the gross carrying amount and accumulated amortization for each major class of definite-lived intangible assets at March 31, 2026 and December 31, 2025:

March 31, 2026 December 31, 2025

The following table presents the weighted-average useful life at June 30, 2026, and the gross carrying amount and accumulated amortization for each major class of definite-lived intangible assets at June 30, 2026 and December 31, 2025:

June 30, 2026 December 31, 2025

Weighted Average Remaining Useful Life

8 unchanged sentences

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 months ended March 31, 2026 and 2025 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 six months ended June 30, 2026 and 2025 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

2026 2025 2026 2025

Amortization expense $ 605 $ 735 $ 1,325 $ 1,567

1 unchanged sentence

Amortization Expense

2026 (from April 1) $ 1,759

2026 (from July 1) $ 1,154

After 2030 2,353

3 unchanged sentences

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 March 31, 2026 and December 31, 2025.

All program rights payables are included in other current liabilities as of March 31, 2026 and December 31, 2025.

Amortization expense for the three months ended March 31, 2026 and 2025, was $ 0.3 million and $ 0.4 million, respectively, which is included in operating expenses.

The Company did not have any long-term program rights liabilities as of June 30, 2026 and December 31, 2025.

All program rights payables are included in other current liabilities as of June 30, 2026 and December 31, 2025.

Amortization expense included in operating expenses was $ 0.2 million and $ 0.4 million for the three and six months ended June 30, 2026, respectively and amortization expense for the three and six months ended June 30, 2025, was $ 0.2 million and $ 0.6 million, respectively.

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

2 unchanged sentences

Amortization Expense

2026 (from April 1) $ 362

2026 (from July 1) $ 212

Sublicense Agreement

6 unchanged sentences

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

There were no promotional airtime expenses, license fees expensed were $ 0.7 million and production costs expensed were $ 0.2 million for the three months ended March 31, 2026.

There were no promotional airtime expenses, license fees expensed were $ 0.2 million and $ 0.9 million, respectively, and production costs expensed were immaterial and $ 0.2 million, respectively, for the three and six months ended June 30, 2026.

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

4 unchanged sentences

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 March 31, 2026, the makegood liability which is associated with these network sales and contracts was $ 6.3 million and is expected to be recognized at various times, but not anticipated to exceed four years and is included in Deferred revenue in the condensed consolidated financial statements.

As of June 30, 2026, the makegood liability which is associated with these network sales and contracts was $ 5.1 million and is expected to be recognized at various times, but not anticipated 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.

25 unchanged sentences

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

Three Months Ended March 31, 2026

Three Months Ended June 30, 2026

Audio Video Consolidated

6 unchanged sentences

Total net revenues $ 11,591 $ 22,378 $ 33,969

Three Months Ended March 31, 2025

Three Months Ended June 30, 2025

Audio Video Consolidated

6 unchanged sentences

Total net revenues $ 15,236 $ 16,009 $ 31,245

Six Months Ended June 30, 2026

Audio Video Consolidated

Net revenues:

Spot Radio & TV Advertising $ 17,945 $ 12,650 $ 30,595

Digital 930 30,493 31,423

Syndication 542 — 542

Events and Sponsorships 325 20 345

Other 1,612 838 2,450

Total net revenues $ 21,354 $ 44,001 $ 65,355

Six Months Ended June 30, 2025

Audio Video Consolidated

Net revenues:

Spot Radio & TV Advertising $ 23,330 $ 11,779 $ 35,109

Digital 1,255 17,731 18,986

Syndication 1,314 — 1,314

Events and Sponsorships 637 50 687

Other 2,392 787 3,179

Total net revenues $ 28,928 $ 30,347 $ 59,275

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

Long-term debt, and Series B Preferred Stock was comprised of the following at March 31, 2026 and December 31, 2025:

March 31, 2026 December 31, 2025

Long-term debt, and Series B Preferred Stock was comprised of the following at June 30, 2026 and December 31, 2025:

June 30, 2026 December 31, 2025

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

11 unchanged sentences

During the first quarter of 2026, the Company obtained an amendment that extended the maturity of its First Lien Credit Agreement debt previously due in May 2026 to July 30, 2026 and waived certain covenant requirements.

As of March 31, 2026, the Company was in compliance with all applicable financial covenants.

In August 2026, the Company entered into a second amendment to the First Lien Credit Agreement that further extended the maturity dates of both Delayed Draw Term Loans from July 30, 2026 to October 31, 2026.

As of June 30, 2026, the Company was in compliance with all applicable financial covenants, with the exception of the Audio Adjusted EBITDA covenant.

On August 14, 2026, the Company received a waiver from the applicable lender with respect to the Company’s failure to satisfy the Audio Adjusted EBITDA covenant for the quarter ended June 30, 2026.

The waiver applies only to the covenant period ended June 30, 2026 and does not extend to any subsequent covenant periods.

Accordingly, the Company has classified $ 34.1 million of outstanding long-term debt as current as of June 30, 2026.

The Company has also reclassified $ 1.8 million of unamortized original issue discount and deferred financing costs associated with such debt to current liabilities, as applicable.

Second Lien Term Loan

4 unchanged sentences

During the first quarter of 2026, the Company entered into an amendment to its Second Lien Credit Agreement that waived certain covenant requirements.

As of March 31, 2026, the Company was in compliance with all applicable financial covenants.

As of June 30, 2026, the Company was in compliance with all applicable financial covenants, with the exception of the Audio Adjusted EBITDA covenant.

On August 14, 2026, the Company received a waiver from the applicable lender with respect to the Company’s failure to satisfy the Audio Adjusted EBITDA covenant for the quarter ended June 30, 2026.

The waiver applies only to the covenant period ended June 30, 2026 and does not extend to any subsequent covenant periods.

Accordingly, the Company has classified $ 31.0 million of outstanding long-term debt as current as of June 30, 2026.

Series B Preferred Stock

9 unchanged sentences

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.

Based on amounts outstanding at March 31, 2026, mandatory principal payments of long-term debt and preferred stock for the next five years and thereafter are summarized below:

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

Remainder of 2026 (from April 1) $ 10,000 $ — $ — $ 10,000

2027 2,625 2,250 — 4,875

2028 3,500 3,000 — 6,500

2029 28,875 24,750 — 53,625

Based on amounts outstanding at June 30, 2026, mandatory principal payments of our debt for the next five years and thereafter, based on the original maturity schedules, are summarized below.

The table excludes the First and Second Lien Term Loans, which are classified as current liabilities:

Series B Preferred Stock

Remainder of 2026 (from July 1) $ —

Thereafter 60,000

3 unchanged sentences

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

As of March 31, 2026, 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.

As of June 30, 2026, 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.

2 unchanged sentences

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 three months ended March 31, 2026 and 2025 was ( 17 )% and ( 3 )%, respectively.

Our effective tax rate for the three months ended March 31, 2026 differs from the statutory tax rate primarily due to the recording of additional interest and penalties on an uncertain tax position as well as the continued recognition of additional valuation allowance.

The effective tax rate for the six months ended June 30, 2026 and 2025 was ( 7 )% and ( 4 )%, respectively.

Our effective tax rate for the six months ended June 30, 2026 differs from the statutory tax rate primarily due to the recording of additional interest and penalties on an uncertain tax position as well as the continued 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.

1 unchanged sentence

The amount recognized is measured as the largest benefit that reaches greater than 50% likelihood of being realized upon ultimate settlement.

As of March 31, 2026 and December 31, 2025, we recorded approximately $ 7.7 million of gross tax liability for uncertain tax positions related to federal and state income tax returns filed.

As of June 30, 2026 and December 31, 2025, we recorded approximately $ 7.7 million of gross tax liability for uncertain tax positions related to federal and state income tax returns filed.

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

As of March 31, 2026 and December 31, 2025, the amount of interest accrued was approximately $ 0.4 million and $ 0.2 million, respectively, and the amount of penalties accrued was approximately $ 1.4 million and $ 0.5 million, respectively, which did not include the federal tax benefit of interest deductions.

As of June 30, 2026 and December 31, 2025, the amount of interest accrued was approximately $ 0.5 million and $ 0.2 million, respectively, and the amount of penalties accrued was approximately $ 0.7 million and $ 0.5 million, respectively, which did not include the federal tax benefit of interest deductions.

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.

5 unchanged sentences

We elected this policy for all classes of underlying assets.

Short-term lease expense recognized during both the three months ended March 31, 2026 and 2025 was not material.

Short-term lease expense recognized during both the three and six months ended June 30, 2026 and 2025 was not material.

On February 27, 2026, the Company entered into an amendment to an existing lease agreement.

2 unchanged sentences

however, the reduction in the lease liability exceeded the decrease in the ROU asset.

During the period, the Company remeasured and modified its lease, which resulted in a reduction of lease liabilities of $ 7.0 million, including a $ 1.0 million reduction in current lease liabilities and a $ 6.0 million reduction in non-current lease liabilities, and a reduction of the ROU asset of $ 5.4 million.

As a result of the lease modification and remeasurement, the Company recorded a $ 7.0 million, reduction in lease liabilities during the first quarter of 2026, consisting of a $ 1.0 million reduction in current lease liabilities and a $ 6.0 million reduction in non-current lease liabilities, as well as a reduction of the ROU asset of $ 5.4 million.

As a result, the Company recognized a remeasurement gain of $ 1.6 million, representing the excess of the reduction in the lease liability over the reduction in the ROU asset.

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Operating lease cost $ 1,698 $ 1,983 $ 3,421 $ 4,022

Operating cash flows from operating leases $ 1,521 $ 1,645 $ 3,075 $ 3,359

March 31, 2026 December 31, 2025

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

June 30, 2026 December 31, 2025

Weighted average remaining lease term - operating leases (in years) 11.4 12.1

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Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Finance lease cost $ 143 $ 226 $ 276 $ 456

Cash flows from finance leases $ 201 $ 193 $ 395 $ 380

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Weighted average remaining lease term - finance leases (in years) 2.8 3.2

Weighted average discount rate - finance leases 11.3 % 11.3 %

As of March 31, 2026, the annual minimum lease payments of our operating and finance lease liabilities were as follows:

As of June 30, 2026, the annual minimum lease payments of our operating and finance lease liabilities were as follows:

Operating Leases Finance Leases

2026 (from April 1)

2026 (from July 1)

$ 3,090 $ 402

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The magnitude and timing of any such clawback would depend on the occurrence and amount of qualifying losses or obligations as defined in the applicable agreements and could be material to the Company’s consolidated financial statements.

At March 31, 2026 as a result of the increase in the uncertain tax position and corresponding interest and penalties, the Company reduced equity by an additional $ 1.1 million pursuant to the equity clawback feature.

At March 31, 2026 and December 31, 2025, $ 9.0 million and $ 7.9 million, respectively, of equity interests were subject to clawback, while no debt instruments have been subject to clawback.

For the three and six months ended June 30, 2026 as a result of the increase in the uncertain tax position and corresponding interest and penalties, the Company increased equity by an additional $ 0.4 million and reduced equity by $ 0.7 million, respectively, pursuant to the equity clawback feature.

At June 30, 2026 and December 31, 2025, $ 8.6 million and $ 7.9 million, respectively, of equity interests were subject to clawback, while no debt instruments have been subject to clawback.

Second Lien Term Loan

3 unchanged sentences

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 $ 0.8 million for the three months ended March 31, 2026 and 2025.

The outstanding balance owed to HPS as of March 31, 2026, was $ 31.1 million, inclusive of PIK interest accreted to principal.

Interest expense recognized on the 2L Term Loan, including both cash and PIK interest, totaled approximately $ 0.8 million for both the three months ended June 30, 2026 and 2025 and $ 1.6 million for both the six months ended June 30, 2026 and 2025.

The outstanding balance owed to HPS as of June 30, 2026, was $ 31.8 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

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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 months ended March 31, 2026 and 2025, $ 0.2 million of fees were incurred related to this agreement.

As of March 31, 2026 and December 31, 2025, the outstanding unpaid balances were 0.2 million and $ 0.7 million, respectively.

For the three and six months ended June 30, 2026, fees of $ 0.2 million and $ 0.3 million, respectively, were incurred related to this agreement and 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.

As of June 30, 2026 and December 31, 2025, the outstanding unpaid balances were $ 0.1 million and $ 0.7 million, respectively.

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.

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

For the three months ended March 31, 2026 and 2025, $ 2.4 million and zero fees were earned related to this agreement and is recorded in other income on the condensed consolidated statements of operations.

$ 1.8 million and $ 0.8 million fees were still owed to the Company as of March 31, 2026 and December 31, 2025.

For the three and six months ended June 30, 2026, $ 1.8 million and $ 4.2 million of fees were earned related to this agreement and $ 0.6 million for both the three and six months ended June 30, 2025 of fees were earned related to this agreement.

These fees are recorded in other income on the condensed consolidated statements of operations.

$ 0.1 million and $ 0.8 million of fees were still owed to the Company as of June 30, 2026 and December 31, 2025.

SEGMENT INFORMATION

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The Company’s Video Segment includes Estrella’s television stations offering a unique aggregation of Spanish-language programming, including originals, topical entertainment, reality, news, and comedy.

The Video Segment’s revenue is primarily derived from television and digital advertising.

The Video Segment’s revenue is primarily

derived from television and digital advertising.

The Company’s television stations serve Los Angeles, CA, Houston, TX, Denver, CO, New York, NY, Chicago, IL and Miami, FL.

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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 March 31, 2026 Audio Video Consolidated

Three Months Ended June 30, 2026 Audio Video Consolidated

Net revenues $ 11,591 $ 22,378 $ 33,969

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Other segment items (2)

Segment operating (loss) income $ ( 2,841 ) $ 7 $ ( 2,834 )

Corporate and other (1)

Interest expense, net 4,029

Other income ( 543 )

Loss before income taxes and equity method investments $ ( 8,375 )

Three Months Ended June 30, 2025 Audio Video Consolidated

Net revenues $ 15,236 $ 16,009 $ 31,245

Operating expenses 15,910 18,864

Depreciation and amortization 872 825

Other segment items (2)

Segment operating loss $ ( 1,549 ) $ ( 3,682 ) $ ( 5,231 )

Corporate and other (1)

Interest expense, net 3,855

Change in fair value of warrant shares liability ( 1,410 )

Other income ( 2,119 )

Loss before income taxes and equity method investments $ ( 7,111 )

Six Months Ended June 30, 2026 Audio Video Consolidated

Net revenues $ 21,354 $ 44,001 $ 65,355

Operating expenses 26,123 43,925

Depreciation and amortization 1,742 1,277

Other segment items (2)

1,114 ( 128 )

3 unchanged sentences

Other income ( 4,222 )

Loss before equity method investments and income taxes $ ( 7,791 )

Three Months Ended March 31, 2025 Audio Video Consolidated

Loss before income taxes and equity method investments $ ( 16,166 )

Six Months Ended June 30, 2025 Audio Video Consolidated

Net revenues $ 28,928 $ 30,347 $ 59,275

2 unchanged sentences

Other segment items (2)

Segment operating income (loss) $ 695 $ ( 3,785 ) $ ( 3,090 )

Segment operating loss $ ( 854 ) $ ( 7,467 ) $ ( 8,321 )

Corporate and other (1)

Interest expense, net 7,609

Change in fair value of warrant shares liability ( 1,410 )

Other income ( 2,230 )

Loss before income taxes $ ( 8,326 )

Loss before income taxes and equity method investments $ ( 15,437 )

(1) Corporate and other is not an operating segment.

Corporate expenses include expenses related to infrastructure and support, including information technology, human resources, legal, finance and administrative functions of the Company, as well as overall executive, administrative and support functions.

(2) Audio’s other segment items consist of loss on disposal of assets.

(2) Audio’s other segment items consist of loss (gain) on disposal of assets.

Assets by reportable segment were as follows:

Total Assets Audio Video Corporate and other (3)

March 31, 2026 $ 148,855 $ 122,937 $ 3,109 $ 274,901

June 30, 2026 $ 142,734 $ 127,454 $ 1,807 $ 271,995

December 31, 2025 $ 169,222 $ 116,727 $ 5,109 $ 291,058

2 unchanged sentences

SUBSEQUENT EVENTS

On April 3, 2026, the Company filed a Registration Statement on Form S-8 with the Securities and Exchange Commission to register shares of its common stock issuable under the Company’s equity compensation plans.

The filing was made to facilitate the grant and issuance of equity-based awards, including stock options and restricted stock units, to eligible employees, directors, and consultants.

The Company believes that the availability of registered shares under the Form S-8 will support its ongoing compensation strategy and align the interests of its personnel with those of its stockholders.

There were no other material subsequent events requiring disclosure through the date these financial statements were issued.

The Company evaluated subsequent events from June 30, 2026 through the date these financial statements were issued and except for those noted below has noted no subsequent events after June 30, 2026 for which disclosure is required.

In August 2026, the Company entered into the Second Amendment to the First Lien Credit Agreement with WhiteHawk Capital Partners, LP, as administrative and collateral agent, and the lenders party thereto.

The Second Amendment extended the maturity dates of the Company's two Delayed Draw Term Loans, with an aggregate principal balance of $ 10.0 million, from July 30, 2026 to October 31, 2026.

All other material terms of the First Lien Credit Agreement remained substantially unchanged..

Additionally, the Company received a waiver from WhiteHawk Capital Partners, LP and HPS, as administrative and collateral agents, and the lenders party thereto, with respect to the Company’s failure to satisfy the Audio Adjusted EBITDA covenant for the quarter ended June 30, 2026.

The waiver applies only to the covenant period ended June 30, 2026 and does not extend to any subsequent covenant periods.

As a result of the waiver, the Company was not in default under the terms of the credit agreement as of June 30, 2026 or as of the date of this filing.

The Company is in compliance with all other covenants under the agreement.

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