What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2026-03-16 compared with 2025-03-14 · 268 added, 189 removed, 1021 unchanged (31% of the section changed)

11 unchanged sentences

We have audited the accompanying consolidated balance sheets of PLAYSTUDIOS, Inc.

and subsidiaries (the "Company") as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive (loss) income, stockholders' equity, and cash flows for each of the three years in the period ended December 31, 2024, and the related notes and the schedule listed in the Index at Item 15 (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive loss, stockholders' equity, and cash flows, for each of the two years in the period ended December 31, 2025, and the related notes and the schedule listed in the Index at Item 15 (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 16, 2026, expressed an unqualified opinion on the Company's internal control over financial reporting.

Basis for Opinion

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Our responsibility is to express an opinion on the Company's financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

1 unchanged sentence

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

2 unchanged sentences

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Critical Audit Matter Description

The Company’s evaluation of goodwill for impairment involves the comparison of the fair value of each reporting unit to its carrying value.

The Company used the discounted cash flow method and guideline public company method to estimate fair value, which requires management to make significant estimates and assumptions related to discount rates and forecasts of future revenues.

Changes in these assumptions could have a significant impact on the fair value of the reporting unit.

Goodwill relates to reporting units within the Company’s playGAMES reportable segment.

The fair value of the reporting units exceeded their carrying values as of the measurement date and, therefore, no impairment was recognized.

Given the significant judgments made by management to estimate the fair value of a certain reporting unit and the difference between its fair value and carrying value, performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to selection of the discount rate and forecasts of future revenue, required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to management’s assumptions used in estimating the fair value of the reporting unit included the following, among others:

• We tested the effectiveness of controls over management’s goodwill impairment evaluation, including those over the determination of the fair value of the reporting unit, such as controls related to management’s selection of the discount rate and forecasts of future revenue.

• We evaluated the reasonableness of management’s revenue forecasts by:

◦ Comparing actual results to management’s historical forecasts.

◦ Comparing the forecasts to Internal communications to management and the Board of Directors.

◦ Considering the impact of changes in the competitive, regulatory, and economic environment on management’s projections.

◦ Evaluating the impact of changes in management’s forecasts from October 1, 2025, annual measurement date to December 31, 2025.

• With the assistance of our fair value specialists, we evaluated the reasonableness of the discount rate by:

◦ Testing the source information underlying the determination of the discount rate and the mathematical accuracy of the calculation.

◦ Developing a range of independent estimates and comparing those to the discount rate selected by management.

/s/ Deloitte & Touche LLP

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We have served as the Company’s auditor since 2018.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholders and the Board of Directors of PLAYSTUDIOS, Inc:

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of PLAYSTUDIOS, Inc.

and subsidiaries (the “Company”) as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the financial statements as of and for the year ended December 31, 2025, of the Company and our report dated March 16, 2026, expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting.

Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte & Touche LLP

Las Vegas, Nevada

March 16, 2026

PLAYSTUDIOS, INC.

12 unchanged sentences

Goodwill 52,222 52,222

Deferred income taxes 3,399 2,764

Other long-term assets 6,236 6,814

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Operating lease liabilities, current 3,656 3,405

Contingent consideration, current

Accrued and other current liabilities

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Minimum guarantee liability 12,000 18,000

Contingent consideration 3,340 —

Deferred income taxes 381 1,198

Operating lease liabilities, non-current 6,659 5,699

Operating lease liabilities, noncurrent

Contingent consideration, noncurrent 2,747 3,340

Other long-term liabilities 757 823

9 unchanged sentences

( 59,963 ) ( 31,324 )

Accumulated other comprehensive (loss) income ( 632 ) 124

Accumulated other comprehensive income (loss) 1,806 ( 632 )

Treasury stock, at cost, 21,739 and 19,450 shares at December 31, 2025 and December 31, 2024, respectively

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Change in fair value of warrant liabilities 156 856

Change in fair value of contingent consideration ( 4,968 ) ( 85 )

Interest income, net 2,943 4,902

Other (expense) income, net ( 182 ) 513

Total other income, net 5,576 7,967

Other expense, net ( 910 ) ( 97 )

Total other (loss) income, net ( 2,779 ) 5,576

Loss before income taxes ( 26,701 ) ( 27,288 )

14 unchanged sentences

Net loss $ ( 28,639 ) $ ( 28,687 )

Other comprehensive (loss) income:

Other comprehensive income (loss):

Change in foreign currency translation adjustment (1)

2,400 ( 432 )

Unrealized (loss) gain from derivative financial instruments (1)

Unrealized gain (loss) from derivative financial instruments (1)

Reclassification of loss (gain) from settlement of derivative financial instruments included in net loss (1)

Total other comprehensive (loss) income ( 756 ) 275

Total other comprehensive income (loss) 2,438 ( 756 )

Comprehensive loss $ ( 26,201 ) $ ( 29,443 )

5 unchanged sentences

(in thousands)

Class A Common Stock Class B Common Stock Additional

Capital Accumulated Other Comprehensive Income Retained

Earnings Treasury Stock Total

Common Stock Class B

Common Stock Additional

Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit

Treasury Stock Total

Stockholders'

8 unchanged sentences

Balance as of December 31, 2024 108,287 11 16,457 $ 2 327,951 ( 632 ) ( 31,324 ) ( 51,293 ) 244,715

Common Stock Class B

Common Stock Additional

Capital Accumulated Other Comprehensive Income (Loss) Retained

Earnings Treasury Stock Total

Stockholders'

Shares Amount Shares Amount

Balance as of December 31, 2023 118,200 $ 12 16,457 $ 2 $ 310,944 $ 124 $ ( 2,637 ) ( 20,094 ) 288,351

Net loss — — — — — — ( 28,639 ) — ( 28,639 )

3 unchanged sentences

Repurchase of common stock ( 2,290 ) — — — — — — ( 3,499 ) ( 3,499 )

Other comprehensive loss — — — — — ( 756 ) — — ( 756 )

Other comprehensive income — — — — — 2,438 — — 2,438

Balance as of December 31, 2025 110,084 $ 11 16,457 $ 2 $ 340,802 $ 1,806 $ ( 59,963 ) $ ( 54,792 ) $ 227,866

12 unchanged sentences

Asset impairments and write-downs

Deferred income tax expense (benefit)

Deferred income tax benefit

( 710 ) ( 1,593 )

2 unchanged sentences

Receivables, net

3,687 ( 4,930 )

Prepaid expenses and other current assets ( 822 ) 1,269

7 unchanged sentences

Additions to internal-use software ( 15,525 ) ( 18,624 )

Purchase of intangible assets — ( 4,393 )

( 409 ) ( 290 )

Net cash used in investing activities ( 16,902 ) ( 26,294 )

10 unchanged sentences

( 4,229 ) ( 23,105 )

Cash and cash equivalents at beginning of period 132,889 134,000

Cash, cash equivalents, and restricted cash at beginning of period

109,784 132,889

Cash, cash equivalents, and restricted cash at end of period

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Due to the inherent uncertainties in making these estimates, actual amounts could differ materially.

Emerging Growth Company

At December 31, 2024, the Company qualified as an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and the Company has taken and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised standards.

The JOBS Act provides that an emerging growth company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable.

The Company has opted to take advantage of such extended transition period available to emerging growth companies which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company can adopt the new or revised standard at the time private companies adopt the new or revised standard.

As a result of the

Company's qualification as an emerging growth company, the Company does not expect to adopt any accounting pronouncements currently deferred based on private company standards.

The Company expects to no longer qualify as an emerging growth company on December 31, 2024, the end of the fiscal year following the fifth year of the Company's initial public offering.

Smaller Reporting Company

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are insured by the Federal Deposit Insurance Corporation (FDIC).

Although balances may exceed amounts insured by the FDIC, the Company believes that it is not exposed to any significant credit risk related to its cash or cash equivalents and has not experienced any losses in such accounts.

Although balances may exceed amounts insured

by the FDIC, the Company believes that it is not exposed to any significant credit risk related to its cash or cash equivalents and has not experienced any losses in such accounts.

Restricted Cash

The Company has restricted cash of $ 1.2 million and zero as of December 31, 2024 and December 31, 2023.

The Company has restricted cash of $ 0.6 million and $ 1.2 million as of December 31, 2025 and December 31, 2024.

The cash is classified within “Other long-term assets.” Such amounts plus “Cash and cash equivalents” on the Consolidated Balance Sheets equal “Cash, cash equivalents, and restricted cash” on the Consolidated Statements of Cash Flows as of December 31, 2025 and December 31, 2024.

8 unchanged sentences

Historical collection rates are considered in determining reserves.

The following table summarizes the major receivables of the Company as a percentage of the total receivables, net as of the dates indicated:

The following table summarizes the major receivables of the Company as a percentage of the total trade receivables as of the dates indicated:

2025 December 31,

1 unchanged sentence

17.8 % 19.1 %

As of December 31, 2024 and December 31, 2023, the Company did not have any additional counterparties that exceeded 10% of the Company’s accounts receivable.

Xsolla (USA), Inc.

As of December 31, 2025 and December 31, 2024, the Company did not have any additional counterparties that exceeded 10% of the Company’s total trade receivables.

Property and Equipment, net

1 unchanged sentence

The Company capitalizes the costs of improvements that extend the life of the asset, while costs of repairs and maintenance are charged to expense as incurred.

Gains or losses on the disposition of property and equipment are included in the determination of income.

Gains or losses on the disposition of property and equipment are included in the determination of income or loss.

Computer equipment, furniture, and fixtures are depreciated using the straight-line method over the estimated useful lives of the assets.

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If a quantitative test is required, the fair value of the asset is compared to the asset's carrying amount.

The fair value of the reporting unit is estimated using market and discounted cash flow approaches.

The discounted cash flow approach requires the use of significant estimates of expected revenues as well as discount rates to determine the estimated fair value.

The market approach uses comparable company information to determine revenue and earnings multiples to value our reporting unit.

Failure to achieve these expected results or market multiples may cause a future impairment of goodwill at the reporting unit.

Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value.

Any impairment would be recognized for the difference between the fair value and the carrying amount limited to the carrying amount of goodwill.

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For indefinite-lived intangible assets, the Company conducts impairment tests annually or more frequently if events or changes in circumstances indicate that it is more likely than not that the fair value of an indefinite-lived asset is less than its carrying value, or when circumstances no longer continue to support an indefinite useful life.

If a triggering event occurs, qualitative factors are first assessed to determine whether a quantitative impairment test is required.

If a triggering event occurs,

qualitative factors are first assessed to determine whether a quantitative impairment test is required.

If a quantitative test is required, the fair value of the intangible is compared to the asset’s carrying amount.

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The Company classifies minimum royalty payment obligations as current liabilities to the extent they are contractually due within the next 12 months.

The long-term portion of the liability related to the minimum guaranteed obligations is reduced as royalty payments are made as required under the license agreement.

The Company assesses the recoverability of license agreements whenever events arise or circumstances change that indicate the carrying value of the licensed asset may not be recoverable.

1 unchanged sentence

Warrant Liabilities

The Company evaluates all of its financial instruments, including issued warrants, to determine if such instruments are liability classified, pursuant to ASC 480, Distinguishing Liabilities from Equity or derivatives or contain features that

qualify as embedded derivatives pursuant to ASC 815, Derivatives and Hedging .

The classification of instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period.

The classification of instruments, including whether such instruments should be recorded as liabilities or as equity, is reassessed at the end of each reporting period.

Fair Value Measurements

40 unchanged sentences

Players can earn loyalty points through a variety of activities, including but not limited to playing the Company’s games, engaging with in-game advertising, engaging with marketing emails, and logging into the game.

The loyalty points can be redeemed for rewards offered by the Company’s rewards partners.

The loyalty points

can be redeemed for rewards offered by the Company’s rewards partners.

There is no obligation for the Company to pay or otherwise compensate the Company’s rewards partners for any player redemptions under the Company’s rewards partner agreements.

3 unchanged sentences

Loyalty points or other virtual currencies may be included in certain bundled purchases through certain platforms.

Loyalty points or other virtual currencies are not available to be purchased separately and there is no stand alone selling price.

Loyalty points or other virtual currencies are not available to be purchased separately and there is no standalone selling price.

If loyalty points or other forms of virtual currencies are included in bundled purchases, the Company will allocate a portion of the transaction price to each of the virtual currencies using the residual approach.

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The transaction price, which is the amount paid for the virtual currency by the player, is allocated entirely to this single performance obligation.

The Company evaluates all consideration payable to a customer and reduces the transaction price if the consideration is not in exchange for a distinct good or service.

As virtual currency represents consumable goods, the Company recognizes revenue as the virtual currency is consumed over the estimated consumption period.

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The Company continues to gather detailed player behavior and assess this data in relation to its revenue recognition policy.

To the extent the player behavior changes, the Company reassesses its estimates and assumptions used for revenue

recognition prospectively on the basis that such changes are caused by new factors indicating a change in player behavior patterns.

To the extent the player behavior changes, the Company reassesses its estimates and assumptions used for revenue recognition prospectively on the basis that such changes are caused by new factors indicating a change in player behavior patterns.

Advertising Revenue

8 unchanged sentences

Further, the price per advertising unit can also be based on revenue share percentages stated in the contract.

The number of advertising units delivered is determined at the end of each month so there is no uncertainty about the transaction price.

The number of advertising units delivered is determined at the end of each

month so there is no uncertainty about the transaction price.

Payment terms are stipulated as a specific number of days subsequent to end of the month, ranging from 45 to 60 days.

7 unchanged sentences

Cost of revenue relates to direct expenses incurred to generate revenue from online and mobile games and are recorded as incurred.

The Company’s cost of revenue consists primarily of payment processing fees, hosting and data center costs related to operating its games, and royalties for licensed games.

The Company’s cost of revenue consists primarily of payment processing fees, hosting and data center costs related to operating its games, and royalties for licensed content.

Payment processing fees consist of fees paid to third-party social and mobile platform operators.

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Restricted stock units (RSUs) are typically granted using a three or four year vesting schedule, either vesting pro rata annually or a cliff vest over the requisite service period, subject to continued employment.

Except as provided in an award or severance agreement between the Company and the employee, if an employee is terminated (voluntarily or involuntarily),

any unvested awards as of the date of termination will be forfeited.

Except as provided in an award or severance agreement between the Company and the employee, if an employee is terminated (voluntarily or involuntarily), any unvested awards as of the date of termination will be forfeited.

In addition, if there is a change in control and qualifying termination of employment (as described in the Company's Severance and Change in Control Plan), certain awards will automatically vest.

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The inputs used to measure the fair value of our foreign currency derivative contracts are categorized as Level 2 in the fair value hierarchy as established by ASC 820.

As of December 31, 2024, the fair value of these foreign currency derivatives contracts were immaterial.

Cash flows from derivatives, which are designated as accounting hedges, are presented consistently with the cash flow classification of the related hedged items.

4 unchanged sentences

Capital accounts are translated at historical foreign currency exchange rates.

Translation gains and losses are included in stockholders’ equity as a component of accumulated other comprehensive income.

Adjustments that arise from foreign currency exchange rate changes on transactions, primarily driven by intercompany transactions, denominated in a currency other than the functional currency are included in “Other (expense) income, net” in the Consolidated Statements of Operations.

Translation gains and losses are included in stockholders’ equity as a component of accumulated other comprehensive income/(loss).

Adjustments that arise from foreign currency exchange rate changes on transactions, primarily driven by intercompany transactions, denominated in a currency other than the functional currency are included in “Other expense, net” in the Consolidated Statements of Operations.

The Company accounts for income taxes in accordance with ASC 740, Income Taxes , which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in its consolidated financial statements or tax returns.

4 unchanged sentences

The Company recognizes interest and penalties related to unrecognized tax benefits in the provision for income taxes.

The Company has elected to account for the impact of the global intangible low-taxed income (GILTI) inclusion and base erosion anti-avoidance tax (BEAT) based on the period cost method.

Net Loss Per Share

2 unchanged sentences

Net loss available to common stockholders represents net loss attributable to common stockholders reduced by the allocation of earnings to participating securities.

Diluted loss per share adjusts basic loss per share for the potentially dilutive impact of stock options, warrants, restricted stock units, performance share units, and contingently issuable earnout shares.

Diluted earnings per share adjusts basic earnings per share for the potentially dilutive impact of stock options, warrants, restricted stock units, performance share units, and contingently issuable earnout shares.

The dilutive effect of stock options, warrants, restricted stock, and contingently issuable earnout shares is computed using the treasury stock method.

2 unchanged sentences

Recently Adopted Accounting Standards

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280) :

Improvements to Reportable Segment Disclosures, which requires public entities to disclose information about their reportable segments’ significant expenses and other segment items on an interim and annual basis.

Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as all existing segment disclosures and reconciliation requirements in ASC 280 on an interim and annual basis.

ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company adopted the new accounting standard for the year ended December 31, 2024.

The adoption of this guidance did not have an effect on the Company’s financial position, results of operations, or cash flows.

See Note 3— Segment Reporting for additional disclosures.

Recently Issued Accounting Standards Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) .

1 unchanged sentence

This guidance is effective for annual periods beginning after December 15, 2024.

The Company is currently evaluating the impact of adopting ASU 2023-09.

The Company adopted the new accounting standard for the year ended December 31, 2025 on a prospective basis.

Comparative information for prior periods has not been restated and continues to be presented under the disclosure requirements in effect during those periods.

The adoption of this guidance did not have an effect on the Company’s financial position, results of operations, or cash flows.

See Note 16— Income Taxes for additional disclosures.

Recently Issued Accounting Standards Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40) .

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The Company is assessing the guidance, noting the adoption impacts disclosure only.

In September 2025, the FASB issued ASU 2025-06, Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40) (“ASU 2025-06”) , which revises the approach to accounting for internal-use software costs by eliminating all references to the stages of software development projects, thereby making the guidance adaptable to a variety of software development methodologies.

ASU 2025-06 will be effective for annual periods beginning after December 15, 2027, and interim periods within those annual reporting periods, on a prospective, modified or retrospective basis, with early adoption permitted.

The Company is currently assessing the effect the guidance will have on the Company's financial condition, results of operations and cash flows.

NOTE 3—SEGMENT REPORTING

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It operates primarily in the social gaming market, which is characterized by gameplay online or on mobile devices, that is social, competitive, and self-directed in pace and session length.

playGAMES also operate in the casual space.

playGAMES generates a substantial portion of our revenue from in-app purchases in the form of virtual currencies, which players can use

to play social casino games.

playGAMES also operates in the casual space.

playGAMES generates the majority of our revenue from in-app purchases in the form of virtual currencies, which players can use to play social casino games.

Players who install our social casino games typically receive free virtual currency upon the initial launch of the game and additional virtual currencies at specific time intervals.

1 unchanged sentence

Once obtained, virtual currencies (either free or purchased) cannot be redeemed for cash nor exchanged for anything other than game play within our games.

playGAMES generate additional revenue in the casual space from the receipt of advertising revenue.

playGAMES generates additional revenue in the casual space from the receipt of advertising revenue.

Players who install our casual games receive free, unlimited gameplay that requires viewing of periodic in-game advertisements.

1 unchanged sentence

Loyalty points may be included in certain bundled purchases through certain platforms.

Loyalty points are not available to be purchased separately and there is no stand alone selling price.

Loyalty points are not available to be purchased separately and there is no standalone selling price.

If loyalty points are included in bundled purchases, the Company will allocate a portion of the transaction price to loyalty points using the residual approach.

27 unchanged sentences

Stock based compensation 14,143

Special infrequent 3,524

Depreciation and amortization 38,360

1 unchanged sentence

Change in fair value of warrant liabilities 156

Change in fair value of contingent consideration ( 4,968 )

Interest income (expense), net 2,943

Other (expense) income, net $ ( 910 )

Income (loss) before income taxes ( 27,288 )

Loss before income taxes ( 26,701 )

Income tax expense $ ( 1,938 )

26 unchanged sentences

Change in fair value of warrant liabilities 856

Change in fair value of contingent consideration

Interest income (expense), net 4,902

Other (expense) income, net $ ( 97 )

Income (loss) before income taxes ( 2,520 )

Loss before income taxes ( 27,288 )

Income tax expense

2 unchanged sentences

Reorganization

On October 29, 2024, the Company initiated an internal reorganization plan (the “2024 Reorganization Plan”) which is intended to enhance efficiency and reduce operating expenses.

The 2024 Reorganization Plan included a reduction of the

Company’s total global workforce by approximately 30 percent, which was substantially completed by the end of the 2024 fiscal year.

On October 29, 2024, the Company initiated an internal reorganization plan (the “2024 Reorganization Plan”) to enhance efficiency and reduce operating expenses.

The 2024 Reorganization Plan included a reduction of the Company’s total global workforce by approximately 30 percent, which was substantially completed by the end of the 2024 fiscal year.

The following table presents the c harges for the 2024 Reorganization Plan:

3 unchanged sentences

$ 119 $ 1 18 $ 138

Asset impairments

$ 119 $ 1 $ 18 $ 138

568 39 468 1,075

$ 11,912 $ 2,647 $ 1,670 $ 16,229

On February 28, 2023, the Company initiated an internal reorganization plan (the "2023 Reorganization Plan") which is intended to enhance efficiency and reduce operating expenses.

The 2023 Reorganization Plan included a reduction of the Company’s total global employee headcount by approximately 14 percent, which was substantially completed by the end of the second quarter of the 2023 fiscal year.

Charges for the 2023 Reorganization Plan consisted of the following:

Year Ended December 31, 2024

2 unchanged sentences

$ 3,956 $ 768 979 $ 5,703

Asset impairments

7,388 1,840 223 9,451

The following table summarizes the activity related to the liabilities associated with the Company's reorganization plans for the years ended December 31, 2024 and 2023:

568 39 468 1,075

$ 11,912 $ 2,647 $ 1,670 $ 16,229

The following table summarizes the activity related to the liabilities associated with the 2024 Reorganization Plan for the years ended December 31, 2025 and 2024:

playGAMES playAWARDS Corporate and Other Total

7 unchanged sentences

Balance as of December 31, 2024

Reorganization charges

2,207 196 365 2,768

Reorganization charges

Non-cash charges

( 2,326 ) ( 197 ) ( 383 ) ( 2,906 )

( 2,317 ) ( 611 ) ( 862 ) ( 3,790 )

Balance as of December 31, 2025

8 unchanged sentences

The goodwill reflects our expectations of favorable future growth opportunities and anticipated synergies through the scale of our operations.

The Company expects that substantially all of the goodwill will be

deductible for federal income tax purposes.

The Company expects that substantially all of the goodwill will be deductible for federal income tax purposes.

The following table summarizes the consideration paid for Pixode and the assets acquired as of the acquisition date:

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MGM Resorts International (“MGM”)

MGM is a stockholder and the President of MGM Resorts Operations also serves on the Company’s Board of Directors.

MGM is a stockholder and the President and Chief Executive Officer of MGM Resorts Japan also serves on the Company’s Board of Directors.

MGM owned approximately 16.6 million shares of the Company's outstanding Class A common stock as of each of December 31, 2025 and December 31, 2024.

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The repurchase of shares from Microsoft was supplemental to the Company’s previously announced $ 50.0 million stock repurchase program and did not impact the amount of permitted repurchases thereunder.

PLAYSTUDIOS Impact Fund

During the year ended December 31, 2025, the Company made charitable contributions of $ 1.5 million to the PLAYSTUDIOS Impact Fund (the “Fund”), a tax-exempt private foundation established by the Company and administered by certain members of the Company’s management team.

These individuals serve as officers and directors of the Fund but receive no compensation in such capacities.

The Fund supports charitable causes selected based on input from Company employees and customers.

The contributions were recorded in "General and administrative" in the accompanying

Consolidated Statements of Operations.

The Company did not make any charitable contribution during the year ended December 31, 2024.

NOTE 6—RECEIVABLES, NET

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Private Warrants — 31 — 31

Derivative financial instruments — 38 — 38

Contingent consideration — — 8,308 8,308

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Private Warrants — 96 — 96

Derivative financial instruments — 38 — 38

Contingent consideration — — 3,340 3,340

Total financial liabilities $ 134 $ 134 $ 3,340 $ 3,608

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The value of these payments are subject to various market and operational risks.

Significant unobservable inputs include a discount rate of approximately 13.5 % and the probability of revenue growth over the same three year period.

See Note 4— Business

Combinations for more information on the Pixode Acquisition.

The change in fair value was included in "Other income (expense), net" in the Consolidated Statements of Operations and consisted of the following:

As of December 31, 2025 and December 31, 2024, significant unobservable inputs include a discount rate of approximately 12.1 % and 13.5 %, respectively, and the probability of revenue growth over the same three year period.

See Note 4— Business Combinations for more information on the Pixode Acquisition.

The change in fair value consisted of the following:

Balance as of December 31, 2023 $ —

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Balance as of December 31, 2024 $ 3,340

Fair value adjustments based upon post-acquisition performance 4,968

Balance as of December 31, 2025 $ 8,308

NOTE 9—PROPERTY AND EQUIPMENT, NET

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Furniture and fixtures 3,681 3,812

Construction in progress — 460

Total property and equipment 33,736 32,338

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During the years ended December 31, 2025 and 2024, depreciation expense was $ 3.9 million and $ 4.9 million, respectively.

Impairment charges or material write-offs were $ 0.4 million for the year ended December 31, 2024, and there was none recorded for the year ended December 31, 2023.

There were no impairment charges or material write-offs were for the year ended December 31, 2025, and there was $ 0.4 million recorded for the year ended December 31, 2024.

Property and equipment, net by region consists of the following:

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During the years ended December 31, 2025 and 2024, intangible asset and internal-use software amortization expenses were $ 34.5 million and $ 40.6 million, respectively.

The Company recorded non-cash impairment charges within "Restructuring and related" in the Consolidated Statements of Operations in the amounts of a $ 9.2 million and $ 1.1 million during the years ended December 31, 2024 and December 31, 2023, respectively.

The Company did not record a non-cash impairment charge during the year ended December 31, 2025.

The Company recorded non-cash impairment charges of $ 9.2 million within "Restructuring and related" in the Consolidated Statement of Operations during the year ended December 31, 2024.

As of December 31, 2025, the estimated annual amortization expenses for the years ending December 31, 2026 through 2030 and thereafter is as follows:

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2025 December 31,

Accrued payroll and vacation 11,824 10,261

Accrued payroll and related 9,143 11,824

Accrued user acquisition 3,793 3,609

Income taxes payable 1,476 1,468

Warrant liabilities 74 230

Minimum guarantee liability 9,469 9,610

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Other licensing agreements — 2,431

Warrant liabilities 230 1,086

Other accruals 5,268 5,496

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Accrued Litigation

The Company is a party to a litigation matter brought by TeamSava d.o.o.

Beograd, or TeamSava, and other related parties.

The plaintiffs filed a Statement of Claim in May 2021 in Tel Aviv District Court in Israel, alleging claims, among other things, that we breached the terms of a commercial contract relating to services provided by TeamSava and related parties in connection with the sourcing and administrative management of personnel in Serbia who provided game development services exclusively for us.

The litigation sought damages of 27.3 million New Israeli Shekels (NIS) (or approximately $ 7.4 million based on prevailing exchange rates as of December 31, 2024).

On November 30, 2023, we entered into a settlement agreement to resolve and settle all claims brought by the plaintiffs against the Company, its Israeli subsidiary and its employees and former employees, and all claims brought by the Company's affiliates against the plaintiffs.

The settlement is contingent upon the confirmation by the respective courts in Israel and Serbia that all related lawsuits have been dismissed.

The Company finalized and paid the settlement as of December 31, 2024.

On April 6, 2022, a class action lawsuit was filed in the United States District Court, Northern District of California, by a purported Company shareholder in connection with alleged federal securities law violations:

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On October 4, 2022, the plaintiffs filed an amendment to the Felipe Complaint.

The Felipe Complaint names the Company, several current and former board members of the Company, board members and officers of Acies Acquisition Corp., and Andrew Pascal, the Company’s Chairman and CEO, as defendants.

The Felipe Complaint alleges misrepresentations and omissions regarding the state of the Company’s development of the Kingdom Boss game and its financial projections and future prospects in the S-4 Registration Statement filed by Acies that was declared effective on May 25, 2021, the Proxy Statement filed by Acies on May 25, 2021, and other public statements that touted Old PLAYSTUDIOS’ and the Company’s financial performance and operations, including statements made on earnings calls and the Amended S-1 Registration Statement filed by the Company that was declared effective on July 30, 2021.

The Felipe Complaint alleges that the misrepresentations and omissions resulted in stock price drops of 13 % on August 12, 2021, and 5 % on February 25, 2022, following (i) the Company’s release of financial results for the second quarter of 2021, ended on June 30, 2021, and (ii) the filing of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and issuance of a press release summarizing financial results for the fourth quarter and year ended December 31, 2021, respectively.

The Felipe Complaint seeks an award of damages for an unspecified amount.

The Felipe Complaint named the Company, several current and former board members of the Company, board members and officers of Acies Acquisition Corp., and Andrew Pascal, the Company’s Chairman and CEO, as defendants.

The Felipe Complaint alleged misrepresentations and omissions regarding the state of the Company’s development of the Kingdom Boss game and its financial projections and future prospects in the S-4 Registration Statement filed by Acies that was declared effective on May 25, 2021, the Proxy Statement filed by Acies on May 25, 2021, and other public statements that touted Old PLAYSTUDIOS’ and the Company’s financial performance and operations, including statements made on earnings calls and the Amended S-1 Registration Statement filed by the Company that was declared effective on July 30, 2021.

The Felipe Complaint alleged that the misrepresentations and omissions resulted in stock price drops of 13 % on August 12, 2021, and 5 % on February 25, 2022, following (i) the Company’s release of financial results for the second quarter of 2021, ended on June 30, 2021, and (ii) the filing of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and issuance of a press release summarizing financial results for the fourth quarter and year ended December 31, 2021, respectively.

The Felipe Complaint sought an award of damages for an unspecified amount.

On January 20, 2025, the parties reached an agreement in principle to settle the matter.

The settlement is subject to the parties’

negotiation of a formal stipulation of settlement and all related documentation, which is currently in process.

The settlement also will be subject to preliminary and final approval by the federal district court in which the case is pending.

The matter will not be fully resolved until such approvals are issued, the case is dismissed, and judgment is entered by the court.

On December 7, 2025, the settlement received final approval by the federal district court in which the case was pending, judgment was entered, and the case was dismissed with prejudice.

On March 8, 2023, Angel Deann Pilati, a purported adult resident citizen of Franklin County, Alabama, filed a civil lawsuit against PLAYSTUDIOS US, LLC in the Circuit Court of Franklin County Alabama (the "Pilati Lawsuit"), alleging that PLAYSTUDIOS US, LLC makes available online games and applications across multiple platforms that are games of chance and thus illegal gambling under Alabama law and seeking to recover, under Alabama’s loss recovery act, all sums paid by Alabama residents to PLAYSTUDIOS US, LLC in its online gambling games during the period beginning one year before the filing of the complaint until the case is resolved.

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The plaintiff claims to seek this recovery "to go to the benefit of the families" of players who paid money to play the games.

The Company believes the claims are without merit and intends to vigorously defend against them;

December 31, 2025, the Pilati Lawsuit is stayed pending the "Settlement" described below.

The Company believes the claims are without merit and if the Settlement is not completed, intends to vigorously defend against them;

however, there can be no assurance that the Company will be successful in the defense of this litigation.

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The plaintiff claims to seek this recovery for the benefit of each individual player's spouse, or if not spouse, child or children, and if not child or children, the next of kin.

The Company believes the claims are without merit and intends to vigorously defend against them;

As of December 31, 2025, the Pilati Lawsuit is stayed pending the "Settlement" described below.

The Company believes the claims are without merit and if the Settlement is not completed, intends to vigorously defend against them;

however, there can be no assurance that the Company will be successful in the defense of this litigation.

On August 22, 2024, James Scott Tipmore, a purported citizen of Kentucky, filed a civil lawsuit against PLAYSTUDIOS US, LLC in the United States District Court for the Western District of Kentucky (the "Tipmore Lawsuit"), alleging that PLAYSTUDIOS US, LLC makes available online games of chance that constitute illegal gambling under Kentucky law and seeking to recover, under Kentucky's loss recovery act, treble the sums paid by Kentucky residents to PLAYSTUDIOS US, LLC in its online gambling games during the period beginning five years before the filing of the lawsuit until the case is resolved.

The Company believes the claims are without merit and intends to vigorously defend against them;

As of December 31, 2025, the Pilati Lawsuit is stayed pending the "Settlement" described below.

The Company believes the claims are without merit and if the Settlement is not completed, intends to vigorously defend against them;

however, there can be no assurance that the Company will be successful in the defense of this litigation.

The Company received four demands for arbitration during 2023 claiming that the games operated by PLAYSTUDIOS US, LLC constitute illegal gambling under the laws of various states.

As of December 31, 2024, three of the demands for arbitration remained active (the "State Arbitration Demands").

As of December 31, 2025, three of the demands for arbitration have been stayed pending the "Settlement" described below (the "State Arbitration Demands").

These demands generally attempt to recover amounts spent by third parties on the Company’s games by relying on state gambling loss recovery statutes and/or by seeking to have the applicable Terms of Service declared invalid.

The Company believes that the claims are without merit and the Company intends to vigorously defend against them;

The Company believes that the claims are without merit and if the Settlement is not completed, the Company intends to vigorously defend against them;

however, there can be no assurance that the Company will be successful in the arbitration proceedings.

In January 2025, the Company reached an agreement in principle to settle the Pilati Lawsuit, Duckworth Lawsuit, Tipmore Lawsuit, and State Arbitration Demands in the form of a six-state class action.

In January 2025, the Company reached an agreement in principle to settle the Pilati Lawsuit, Duckworth Lawsuit, Tipmore Lawsuit, and State Arbitration Demands in the form of a six-state class action (the "Settlement").

As of February 17, 2025, the Pilati Lawsuit, Duckworth Lawsuit, Tipmore Lawsuit, and State Arbitration Demands had been stayed.

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It is not currently known when the Settlement will be finalized.

As of December 31, 2024 the Company accrued $ 9.8 million in connection with the Felipe Complaint, Pilati Lawsuit, Duckworth Lawsuit, Tipmore Lawsuit, and State Arbitration Demands and the Company expects to receive $ 3.8 million in estimated insurance recoveries.

As of December 31, 2025 and 2024 the Company accrued $ 3.2 million and $ 9.8 million, respectively, in connection with the Felipe Complaint, Pilati Lawsuit, Duckworth Lawsuit, Tipmore Lawsuit, and State Arbitration Demands.

During the year ended December 31, 2025, the Company paid $ 2.75 million in connection with the settlement of the Felipe Complaint and an insurer contributed an additional $ 3.75 million toward the settlement, resulting in a total settlement of $ 6.5 million.

The Company does not have any additional accruals related to the Felipe Complaint.

Warrant Liabilities

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Each whole Public Warrant entitles the registered holder to purchase one whole share of the Company’s Class A common stock at a price of $ 11.50 in cash per share, subject to adjustment as discussed below, as of October 27, 2021.

Pursuant to the Warrant Agreement, a holder of Public Warrants may exercise the Public Warrants only for a whole number of shares of Class A

common stock.

Pursuant to the Warrant Agreement, a holder of Public Warrants may exercise the Public Warrants only for a whole number of shares of Class A common stock.

The Public Warrants will expire 5 years after the completion of the Acies Merger, or earlier upon redemption or liquidation.

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Additionally, the Private Warrants are non-redeemable so long as they are held by the initial holder or any of its permitted transferees.

If the Private Warrants are held by someone other than the initial holder or its permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.

If the Private Warrants are held by someone other than the initial holder or its permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by such

holders on the same basis as the Public Warrants.

The Private Warrants may be exercised on a cashless basis so long as held by the Sponsor or certain permitted transferees.

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The Company's operating leases primarily consist of real estate leases such as offices.

Our leases have remaining terms of approximately less than one year to four years .

Our leases have remaining terms of approximately less than one year to three years .

During the years ended December 31, 2025 and December 31, 2024, operating lease expense was $ 4.2 million and $ 4.6 million, respectively.

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Our total variable and short-term lease payments were immaterial for all periods presented.

As of December 31, 2025, we did not have material additional operating leases that have not yet commenced.

On June 30, 2024, the Company renewed its lease of office space located in Tel Aviv, Israel.

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Year ending December 31, Operating Leases

2028 and thereafter 382

Total undiscounted cash flows $ 8,338

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Lease liabilities, total $ 7,726

As of December 31, 2024, we did not have material additional operating leases that have not yet commenced.

NOTE 14—LONG-TERM DEBT

Credit Agreement

On June 24, 2021, in connection with the closing of the Acies Merger, the Company terminated and replaced the Revolver (as defined below).

The Company, a subsidiary of the Company, JPMorgan Chase Bank, N.A., as administrative agent and JPMorgan Chase Bank, N.A., Silicon Valley Bank and Wells Fargo Securities, LLC, as joint bookrunners and joint lead arrangers entered into a credit agreement (the “Credit Agreement”) which provides for a five-year revolving credit facility in an aggregate principal amount of $ 75.0 million.

On June 24, 2021, the Company, a subsidiary of the Company, JPMorgan Chase Bank, N.A., as administrative agent and JPMorgan Chase Bank, N.A., Silicon Valley Bank and Wells Fargo Securities, LLC, as joint bookrunners and joint lead arrangers entered into a credit agreement (the “Credit Agreement”) which provides for a five-year revolving credit facility in

an aggregate principal amount of $ 75.0 million.

Borrowings under the Credit Agreement may be borrowed, repaid and re-borrowed by the Company, and are available for working capital, general corporate purposes, and permitted acquisitions.

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As of December 31, 2025 and December 31, 2024, contract assets recorded in the Company’s Consolidated Balance Sheets were immaterial.

The deferred revenue balance related to the purchase of virtual currency was $ 0.1 million as of December 31, 2024 and immaterial as of December 31, 2023.

The deferred revenue balance related to the purchase of virtual currency was $ 0.4 million as of December 31, 2025 and $ 0.1 million as of December 31, 2024.

The opening and closing balance of trade receivables is further described in Note 6— Receivables, net .

NOTE 16—INCOME TAXES

As of December 31, 2024, current and future earnings in the Company's foreign subsidiaries are not permanently reinvested.

Earnings from these subsidiaries are subject to tax in their local jurisdiction, and withholding taxes in these jurisdictions are considered as distributions are made.

Income (loss) before income taxes by tax jurisdiction consists of the following for the periods shown below (in thousands):

The components of income (loss) before income taxes were as follows:

Years Ended December 31,

(in thousands)

United States $ ( 29,928 ) $ ( 31,268 )

Foreign 3,227 3,980

Total income (loss) $ ( 27,288 ) $ ( 2,520 )

Provision for (benefit from) current and deferred income taxes consists of the following for the periods shown below (in thousands):

Total loss $ ( 26,701 ) $ ( 27,288 )

The provision for income taxes consisted of the following:

Years Ended December 31,

( in thousands)

Current tax expense:

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Total deferred tax expense $ ( 239 ) $ ( 1,371 )

Income tax expense $ 1,399 $ 16,873

The difference between the actual rate and the federal statutory rate is as follows:

Years Ended December 31,

Provision for Income Taxes $ 1,938 $ 1,399

The following is a reconciliation between the U.S.

federal statutory tax rate and our effective tax rate for the current year, expressed in thousands and as a percentage of pre-tax income:

( in thousands)

Tax expense (benefit) computed at U.S.

federal statutory rate $ ( 5,607 ) 21.0 %

State and Local Income Taxes, Net of Federal Income Tax Effect (1)

Foreign tax effects

Stock-based compensation (2)

Other 235 ( 0.9 )

Other foreign jurisdictions 558 ( 2.1 )

Effects of cross-border tax laws

Foreign branch income

Deduction for foreign taxes

Other effects 122 ( 0.5 )

R&D tax credits ( 160 ) 0.6

Changes in valuation allowance 3,974 ( 14.9 )

Nontaxable or nondeductible items:

Stock-based compensation (2)

1,683 ( 6.3 )

Section 162(m) - executive compensation 284 ( 1.1 )

Other nontaxable or nondeductible items 277 ( 1.0 )

Changes in unrecognized tax benefits 7 —

Other adjustments ( 269 ) 1.0

Effective income tax rate $ 1,938 ( 7.3 ) %

(1) States that make up the majority (>50%) of state and local taxes are California, Texas, and Illinois.

(2) Stock-based compensation includes non-deductible equity compensation and tax effects of shortfalls and windfalls.

Statutory rate 21.0 %

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Other foreign branch impacts

( 4.6 ) ( 16.7 )

Valuation allowance ( 17.5 )

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Effective tax rate ( 5.1 ) %

The Company made income tax payments (net of refunds received) during the year ended December 31, 2025, as follows:

( in thousands)

Year Ended December 31, 2025

Singapore 152

Other foreign jurisdictions

Total cash paid for income taxes (net of refunds received) $ 1,554

Deferred tax assets and liabilities consist of the following (in thousands):

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Charitable contribution 399 1

Property and equipment 13,185 5,288

Section 174 amortization (1)

14,663 15,671

Operating lease liabilities 2,495 2,231

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Intangibles — 638

Property and equipment 917 2,486

Prepaid expenses 1,148 1,100

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Deferred tax assets (liability), net $ 3,524 $ 3,018

The Company had approximately $ 5.1 million of accumulated federal net operating loss as of December 31, 2024, which may be carried forward indefinitely to offset taxable income.

The Company had approximately $ 0.9 million of

accumulated federal research credit carryforward as of December 31, 2024.

(1) Section 174 amortization for the year ended December 31, 2024 has been reclassified to conform to the current year presentation.

As of December 31, 2025, the Company had gross U.S.

federal net operating losses of $ 6.1 million and tax credit carryforwards of $ 1.1 million.

As of December 31, 2024, the Company had gross U.S.

federal net operating losses of $ 5.1 million and tax credit carryforwards of $ 0.9 million.

The Company’s federal net operating losses can be carried forward indefinitely.

The federal research credits are limited to a 20-year carryforward period and will expire starting in 2041.

The Company had tax effected state net operating loss carryforwards of approximately $ 1.8 million as of December 31, 2024, of which $ 0.1 million will carryforward indefinitely and $ 1.3 million will begin to expire between 2036 and 2044.

The Company had $ 4.4 million of California research credit carryforwards as of December 31, 2024, which may be carried forward indefinitely.

The Company also had $ 0.6 million of Texas research credit carryforwards as of December 31, 2024, which may be carried forward for 20 years and will expire starting in 2038.

Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets.

A significant piece of objective negative evidence evaluated was the cumulative loss the Company expects to enter within the next three months.

Such objective evidence limits the ability to consider other subjective evidence, such as our projections for future growth.

On the basis of this evaluation, as of December 31, 2024, a valuation allowance of $ 23.8 million has been recorded to recognize only the portion of the deferred tax asset that is more likely than not to be realized.

As of December 31, 2025, the Company had tax effected state net operating loss carryforwards of approximately $ 1.6 million, of which $ 0.1 million will carryforward indefinitely and $ 1.5 million will begin to expire between 2036 and 2044.

The Company also had $ 4.6 million of state research credits, of which $ 0.5 million begin to expire in 2038 while the remaining are carried forward indefinitely.

After consideration of all positive and negative evidence, including scheduled reversals of deferred tax assets and liabilities, projected future taxable income, tax planning strategies, and results of recent operations, management determined that it is more likely than not that a portion of our deferred tax assets will not be realized.

As a result, we recorded a valuation allowance of $ 27.9 million and $ 23.8 million as of December 31, 2025 and 2024, respectively.

The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased, or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as our projections for growth.

In July 2025, U.S.

Congress enacted the One Big Beautiful Bill Act (“OBBBA”), which included a range of tax reform measures, including the extension and modification of certain provisions originally enacted under the Tax Cuts and Jobs Act.

The OBBBA does not materially impact the Company’s effective tax rate or cash flows in the current fiscal year.

The following is a tabular reconciliation of the total amounts of unrecognized tax benefits:

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Decreases for tax positions of prior years ( 68 ) ( 14 )

Settlements — —

Decreases for lapses in statute of limitations ( 77 ) $ ( 148 )

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The Company has analyzed filing positions in all of the federal, state, and foreign jurisdictions where it is required to file income tax returns and for all open tax years.

As of December 31, 2024, the Company recorded approximately $ 0.5 million of unrecognized tax benefits, of which $ 0.1 million would impact the effective tax rate, if recognized.

The Company does not anticipate that its unrecognized tax benefits will materially change within the next 12 months.

As of December 31, 2025, the Company recorded approximately $ 0.5 million of unrecognized tax benefits, of which zero would impact the effective tax rate, if recognized.

The Company’s policy for recording interest and penalties associated with audits and unrecognized tax benefits is to record such items as a component of income tax expense.

As of December 31, 2024, income tax expense includes an accrual of $ 0.1 million for the payment of interest and penalties associated with unrecognized tax benefits.

As of December 31, 2025, there are no interest or penalties associated with the uncertain tax benefit as the entire balance relates to a reduction of a deferred tax asset not yet realized.

As of December 31, 2025, current and future earnings in the Company's foreign subsidiaries are not permanently reinvested.

Earnings from these subsidiaries are subject to tax in their local jurisdiction, and withholding taxes in these jurisdictions are considered as distributions are made.

The Company is subject to taxation in the U.S.

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federal and state tax returns for the years 2022 to present.

The tax years starting from 2019 remain open to examination by the Israeli taxing authority.

The tax years starting from 2022 remain open to examination by the Israeli Tax Authority.

The tax years starting from 2020 remain open to examination by the Hong Kong Inland Revenue Department for Asia.

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Year Ending December 31, Minimum Guarantee

2028 and thereafter 6,000

Total $ 21,469

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The Company is not able to reasonably estimate the probability or amount of loss and therefore has not made any accruals.

LLC in the Superior Court of the State of California for the County of Los Angeles, alleging that PLAYSTUDIOS US, LLC breached an agreement to arbitrate a dispute arising out of plaintiffs’ engagement with games operated by the Company, and seeking an order to compel the Company to arbitrate.

The Company believes the claims are without merit and intends to vigorously defend against them;

however, there can be no assurance that the Company will be successful in the defense of this litigation.

The Company is not able to reasonably estimate the probability or amount of loss relating to this litigation and therefore has not made any accruals.

On February 10, 2025, Britt Englund and Brett Chapin, purported citizens of California and two of the named claimants in the May 24, 2024 pre-arbitration notices referenced above, filed a civil lawsuit against PLAYSTUDIOS US, LLC in the Superior Court of the State of California for the County of Los Angeles, alleging that PLAYSTUDIOS US, LLC breached an agreement to arbitrate a dispute arising out of plaintiffs’ engagement with games operated by the Company, and

seeking an order to compel the Company to arbitrate.

The complaint was dismissed by the plaintiffs on April 25, 2025 as part of an agreement to arbitrate the matter.

The claimants filed arbitration proceedings in August of 2025.

The Company believes that the claims are without merit and the Company intends to vigorously defend against them;

however, there can be no assurance that the Company will be successful in the defense of these demands.

The Company is not able to reasonably estimate the probability or amount of loss and therefore has not made any accruals.

On July 7, 2025 and August 15, 2025, a law firm representing two individuals filed arbitration proceedings against the Company alleging violations of the California Invasion of Privacy Act and California common law intrusion upon seclusion and invasion of privacy arising out the individuals' viewing of webpages and the Company's alleged use of a tracking code known as the Meta Pixel.

The Company believes that the claims are without merit and the Company intends to vigorously defend against them;

however, there can be no assurance that the Company will be successful in the defense of these demands.

The Company is not able to reasonably estimate the probability or amount of loss and therefore has not made any accruals.

On March 10, 2026, the Company initiated an internal reorganization plan (the “2026 Reorganization Plan”) which is intended to enhance efficiency and reduce operating expenses.

The 2026 Reorganization Plan includes a reduction of the Company’s current total global workforce by approximately 27 percent.

The Company expects to substantially complete the personnel reduction by the end of the second quarter of fiscal year 2026, but the timing of certain reductions will vary based on job function and location, including local legal requirements.

The Company currently estimates that it will incur approximately $ 4.5 million to $ 7.0 million in charges in connection with the 2026 Reorganization Plan, which will be substantially incurred in the first quarter of fiscal year 2026.

These charges primarily relate to employee transition, severance payments, employee benefits, stock-based compensation, and lease termination and other facility-related costs.

The estimates of the charges and expenditures that the Company expects to incur in connection with the 2026 Reorganization Plan, and the timing thereof, are subject to a number of assumptions, including local legal requirements in various jurisdictions, and actual amounts may differ materially from estimates.

In addition, the Company may incur other charges or cash expenditures not currently contemplated due to unanticipated events that may occur in connection with the implementation of the Plan.

NOTE 18—STOCKHOLDERS’ EQUITY

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In addition, the outstanding shares of Class B common stock will be subject to a “sunset” provision by which all outstanding shares of Class B common stock will automatically convert into shares of Class A common stock (i) if holders representing a majority of the Class B common stock vote to convert the Class B common stock into Class A common stock, (ii) if the Founder Group and its permitted transferees collectively no longer beneficially own at least 20 % of the number of shares of Class B common stock collectively held by the Founder Group as of the closing of the Acies Merger, or (iii) on the nine-month anniversary of the Founder’s death or disability, unless such date is extended by a majority of independent directors of the Company.

Accumulated Other Comprehensive (Loss) Income

The following tables show a summary of changes in accumulated other comprehensive (loss) income:

Accumulated Other Comprehensive Income (Loss)

The following tables show a summary of changes in accumulated other comprehensive income (loss):

Foreign Currency Derivative Contracts

Adjustment Total Accumulated Other Comprehensive Income (Loss)

Adjustment Total Accumulated Other Comprehensive (Loss) Income

Balance as of December 31, 2024 $ ( 38 ) $ ( 594 ) $ ( 632 )

Net losses recognized in other comprehensive income before reclassifications

( 324 ) — ( 324 )

Foreign currency translation — 2,400 2,400

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Foreign Currency Derivative Contracts

Adjustment Total Accumulated Other Comprehensive (Loss) Income

Adjustment Total Accumulated Other Comprehensive Income (Loss)

Balance as of December 31, 2023 $ 286 $ ( 162 ) $ 124

Net gains recognized in other comprehensive income before reclassifications

( 324 ) — ( 324 )

Foreign currency translation — ( 432 ) ( 432 )

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At December 31, 2024, the Company had outstanding foreign currency derivative contracts to purchase certain foreign currencies at future dates.

The amount of future operating expenses the Company had hedged was approximately $ 2.5 million, and all contracts are expected to mature during the next 12 months.

The aggregate fair value of the Company’s derivative contracts was a net liability of less than $ 0.1 million as of December 31, 2024 and was recorded in " Accrued and other liabilities " in the accompanying Consolidated Balance Sheet.

At December 31, 2023, the Company had outstanding foreign currency derivative contracts to purchase certain foreign currencies at future dates.

The amount of future operating expenses the Company had hedged was approximately $ 2.5 million, and all contracts were completed during the year ended December 31, 2025.

The aggregate fair value of the Company’s derivative contracts was a net asset of $ 0.3 million as of December 31, 2023.

and was recorded in " Prepaid expenses and other current assets " in the accompanying Consolidated Balance Sheet.

There were no outstanding derivative contracts at December 31, 2025.

The aggregate fair value of the Company’s derivative contracts was a net liability of less than $ 0.1 million as of December 31, 2024 and was recorded in "Accrued and other liabilities" in the accompanying Consolidated Balance Sheets.

Treasury Stock

4 unchanged sentences

Class A common stock repurchased through the Stock Repurchase Program

Class A common stock repurchased outside of the Stock Repurchase Program

11,677 24,639

Balance as of December 31, 2025 21,739 $ 54,792

1 unchanged sentence

On November 10, 2021, the Company’s Board of Directors approved a stock repurchase program authorizing the Company to purchase up to $ 50.0 million of the Company’s Class A common stock over a period of 12 months.

On November 2, 2022, the Company’s Board of Directors extended such period for an additional 12 months from November 10, 2022 to November 10, 2023.

On November 1, 2023, the Company's Board of Directors extended the stock repurchase program through November 10, 2024 and increased the remaining amount authorized to $ 50.0 million.

On November 1, 2024, the Company's Board of Directors extended the repurchase program through November 1, 2025.

Each year since inception, the stock repurchase program has been extended 12 months by the Board of Directors with the most recent extension being approved on October 31, 2025.

On November 1, 2023, the Company's Board of Directors increased the remaining amount authorized to $ 50.0 million.

Subject to applicable rules and regulations, the shares may be purchased from time to time in the open market or in privately negotiated transactions.

Such purchases will be at times and in amounts as the Company deems appropriate, based on factors such as market conditions, legal requirements, and other business considerations.

Subsequent to December 31, 2024, the Company acquired 0.7 million additional shares of its Class A common stock under this program at an aggregate value of $ 1.3 million and an average price of $ 1.72 per share.

Repurchased shares were held in treasury.

The remaining availability under the stock repurchase program was $ 42.2 million after the subsequent purchases.

The remaining availability under the stock repurchase program was $ 40.0 million as of December 31, 2025 and $ 43.5 million as of December 31, 2024.

NOTE 19—STOCK-BASED COMPENSATION

2 unchanged sentences

Old PLAYSTUDIOS' 2011 Omnibus Stock and Incentive Plan (the “2011 Plan”) and the 2021 Equity Incentive Plan (the “2021 Plan”).

The 2021 Plan provides for the grant of non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units and other stock awards, and performance awards to employees, officers, non-employee directors and independent service providers of the Company.

The 2021 Plan provides for the grant of non-qualified

stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units and other stock awards, and performance awards to employees, officers, non-employee directors and independent service providers of the Company.

The 2021 Plan replaced the 2011 Plan in June 2021.

19 unchanged sentences

( 287 ) 1.00 $ 280

( 79 ) $ 1.89

( 76 ) $ 1.63

Outstanding - December 31, 2024 5,070 $ 1.28 2.9

6 unchanged sentences

As of December 31, 2025, there were 4.6 million options outstanding, of which 2.7 million options are issuable into Class A common stock and 1.9 million options are issuable into Class B common stock.

As of December 31, 2024, there was an immaterial amount of unrecognized compensation expense related to stock options granted to employees.

As of December 31, 2025, there was no unrecognized compensation expense related to stock options granted to employees.

Restricted Stock Units ("RSUs")

15 unchanged sentences

Outstanding - December 31, 2023

Outstanding - Granted 342 2.20

Outstanding - Vested — — $ —

Outstanding - Forfeited — —

Outstanding - December 31, 2024 342 $ 2.20

Granted 2,741 1.67

1 unchanged sentence

Forfeited ( 233 ) 1.82

Expired ( 342 ) 2.20

Outstanding - December 31, 2025 2,508 $ 1.65

The PSUs are not expected to vest so no stock compensation was recognized during the year ended December 31, 2024.

The PSUs outstanding at December 31, 2025 and 2024 did not vest so there was no stock compensation recognized during the years ended December 31, 2025 and 2024.

There was no unrecognized compensation expense as of the year ended December 31, 2025.

2 unchanged sentences

Diluted net loss per share is computed by dividing net loss attributable to Class A and Class B common stockholders by the weighted-average number of each respective class of common stock outstanding, including the potential dilutive securities.

For the calculation of diluted net loss per share, net income attributable to Class A and Class B common stockholders is adjusted to reflect the potential effect of dilutive securities.

For the calculation of diluted net loss per share, net loss attributable to Class A and Class B common stockholders is adjusted to reflect the potential effect of dilutive securities.

The following table sets forth the computation of basic and diluted net loss attributable to Class A and Class B common stockholders per share (in thousands except per share data):

19 unchanged sentences

Restricted stock units 12,248 13,063

Performance stock units

Public Warrants 5,383 5,383

2 unchanged sentences

43,526 42,680

Vesting of the PSUs was based on the Company’s achievement of certain financial performance targets for the fiscal year ended December 31, 2025.

Applicable performance targets were not achieved and, therefore, such PSUs did not vest.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANT ON ACCOUNTING AND FINANCIAL DISCLOSURE

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-K

Item 8. Financial Statements and Supplementary Data