What changed in this filing

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Item 1. Financial Statements

2026-05-04 compared with 2025-11-10 · 497 added, 774 removed, 525 unchanged (71% of the section changed)

3 unchanged sentences

in millions, except per share amounts)

Successor Predecessor Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30, Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024 2025 2025 2024

Successor Predecessor

Three Months Ended March 31, Three Months Ended March 31,

Revenues $ 7,347 $ 7,192

1 unchanged sentence

Operating 4,855 4,961

Programming charges — — — — — 1,118

Selling, general and administrative 1,411 1,543

Depreciation and amortization 362 88

Impairment charges — — 104 — 157 6,100

Restructuring and transaction-related items 103 85

1 unchanged sentence

Gain on dispositions — 35

Operating income (loss) 244 80 337 244 1,029 ( 5,398 )

Operating income 616 550

Interest expense ( 238 ) ( 217 )

Interest income 38 38

Loss from investment — — — — — ( 4 )

Other items, net ( 24 ) ( 37 )

Earnings (loss) from continuing operations before income

taxes and equity in loss of investee companies 122 ( 8 ) 120 122 504 ( 6,062 )

(Provision for) benefit from income taxes ( 85 ) 229 ( 45 ) ( 85 ) 79 342

Earnings before income taxes and equity in loss of investee companies 392 334

Provision for income taxes ( 155 ) ( 100 )

Equity in loss of investee companies, net of tax ( 62 ) ( 73 )

Net earnings (loss) from continuing operations 4 190 16 4 412 ( 5,941 )

Net earnings from discontinued operations,

net of tax — — 5 — — 14

Net earnings (loss)

(Parent and noncontrolling interests) 4 190 21 4 412 ( 5,927 )

Net earnings (Parent and noncontrolling interests) 175 161

Net earnings attributable to noncontrolling interests ( 7 ) ( 9 )

Net earnings (loss) attributable to Parent $ ( 13 ) $ ( 244 ) $ 1 $ ( 13 ) $ ( 35 ) $ ( 5,966 )

Amounts attributable to Parent:

Net loss from continuing operations $ ( 13 ) $ ( 244 ) $ ( 4 ) $ ( 13 ) $ ( 35 ) $ ( 5,980 )

Net earnings from discontinued operations, net of tax — — 5 — — 14

Net earnings (loss) attributable to Parent $ ( 13 ) $ ( 244 ) $ 1 $ ( 13 ) $ ( 35 ) $ ( 5,966 )

Basic net earnings (loss) per common share

attributable to Parent:

Net loss from continuing operations $ ( .01 ) $ ( .36 ) $ ( .01 ) $ ( .01 ) $ ( .05 ) $ ( 9.04 )

Net earnings from discontinued operations $ — $ — $ .01 $ — $ — $ .02

Net loss $ ( .01 ) $ ( .36 ) $ — $ ( .01 ) $ ( .05 ) $ ( 9.02 )

Diluted net earnings (loss) per common share attributable

Net loss from continuing operations $ ( .01 ) $ ( .36 ) $ ( .01 ) $ ( .01 ) $ ( .05 ) $ ( 9.04 )

Net earnings from discontinued operations $ — $ — $ .01 $ — $ — $ .02

Net loss $ ( .01 ) $ ( .36 ) $ — $ ( .01 ) $ ( .05 ) $ ( 9.02 )

Net earnings attributable to Parent $ 168 $ 152

Basic net earnings per common share attributable to Parent $ .15 $ .23

Diluted net earnings per common share attributable to Parent $ .15 $ .22

Weighted average number of common shares outstanding:

4 unchanged sentences

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Successor Predecessor Successor Predecessor

2025 2025 2024 2025 2025 2024

Net earnings (loss)

(Parent and noncontrolling interests) $ 4 $ 190 $ 21 $ 4 $ 412 $ ( 5,927 )

Successor Predecessor

Three Months Ended March 31, Three Months Ended March 31,

Net earnings (Parent and noncontrolling interests) $ 175 $ 161

Other comprehensive income (loss), net of tax:

Cumulative translation adjustments ( 50 ) 68

Cash flow hedges ( 36 ) 6

Decrease to net actuarial loss and prior service costs — 10

1 unchanged sentence

(Parent and noncontrolling interests) ( 86 ) 84

Comprehensive income (loss) 30 144 122 30 553 ( 5,896 )

Comprehensive income attributable to

noncontrolling interests 18 433 21 18 448 38

Comprehensive income (loss) attributable to Parent $ 12 $ ( 289 ) $ 101 $ 12 $ 105 $ ( 5,934 )

Comprehensive income 89 245

Comprehensive income attributable to noncontrolling interests 7 10

Comprehensive income attributable to Parent $ 82 $ 235

See notes to consolidated financial statements.

2 unchanged sentences

in millions, except per share amounts)

Successor Predecessor

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Current Assets:

10 unchanged sentences

Deferred income tax assets, net 1,241 1,282

Advance consideration for WBD acquisition 2,800 —

Other assets 2,555 2,553

22 unchanged sentences

Class B Common Stock, par value $ .001 per share;

5,500 (2025) and 5,000 (2024)

5,500 shares authorized;

1 unchanged sentence

Additional paid-in capital 13,316 13,386

Treasury stock, at cost;

— (2025) and 503 (2024) shares of Class B Common Stock

Retained earnings (accumulated deficit) ( 1,180 ) 7,487

Accumulated deficit ( 1,585 ) ( 1,753 )

Accumulated other comprehensive income (loss) ( 27 ) 59

7 unchanged sentences

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024

Operating Activities:

Net earnings (loss) (Parent and noncontrolling interests) $ 4 $ 412 $ ( 5,927 )

Net earnings from discontinued operations, net of tax — — 14

Net earnings (loss) from continuing operations 4 412 ( 5,941 )

Adjustments to reconcile net earnings (loss) from continuing operations to net cash flow provided by

Three Months Ended March 31, Three Months Ended March 31,

Operating Activities:

Programming charges — — 1,118

Net earnings (Parent and noncontrolling interests) $ 175 $ 161

Adjustments to reconcile net earnings to net cash flow provided by operating activities:

Depreciation and amortization 362 88

Impairment charges — 157 6,100

Deferred tax (benefit) provision 27 ( 401 ) ( 622 )

Deferred tax provision 37 45

Stock-based compensation 80 44

Gain on dispositions — ( 35 )

Loss from investment — — 4

Equity in loss of investee companies, net of tax and distributions 64 73

4 unchanged sentences

Capital expenditures ( 89 ) ( 57 )

Advance consideration for WBD acquisition ( 2,800 ) —

Proceeds from dispositions 11 61

Other investing activities ( 6 ) —

Net cash flow used for investing activities from continuing operations ( 42 ) ( 276 ) ( 365 )

Net cash flow provided by investing activities from discontinued operations — — 48

Net cash flow used for investing activities ( 2,976 ) ( 69 )

Financing Activities:

Repayment of Skydance credit facility ( 720 ) — —

Dividends paid on preferred stock — — ( 29 )

Borrowings under credit facility 2,150 —

Repayment of debt ( 347 ) —

Dividends paid on common stock ( 61 ) ( 36 )

2 unchanged sentences

Other financing activities ( 1 ) —

Net cash flow used for financing activities ( 821 ) ( 159 ) ( 298 )

Net cash flow provided by (used for) financing activities 1,484 ( 139 )

Effect of exchange rate changes on cash and cash equivalents ( 26 ) 40

Net decrease in cash and cash equivalents ( 588 ) ( 201 ) ( 17 )

Cash and cash equivalents at beginning of period (Note 15) 3,851 2,661 2,460

Cash and cash equivalents at end of period (Note 15) $ 3,263 $ 2,460 $ 2,443

Net (decrease) increase in cash and cash equivalents ( 1,333 ) 12

Cash and cash equivalents at beginning of year 3,274 2,661

Cash and cash equivalents at end of period $ 1,941 $ 2,673

See notes to consolidated financial statements.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Three Months Ended September 30, 2025

Class A and B Common Stock Outstanding Additional Paid-In Capital Treasury

Stock Retained Earnings (Accumulated Deficit) Accumulated Other Comprehensive Income (Loss) Total Paramount Stockholders’ Equity Noncontrolling Interests Total Equity

June 30, 2025 (Predecessor) 674 $ 1 $ 33,455 $ ( 22,958 ) $ 7,626 $ ( 1,419 ) $ 16,705 $ 406 $ 17,111

Stock-based compensation activity — — 24 — — — 24 — 24

Noncontrolling interests — — — — — — — 34 34

Net earnings (loss) — — — — ( 244 ) — ( 244 ) 434 190

Other comprehensive loss — — — — — ( 45 ) ( 45 ) ( 1 ) ( 46 )

Cancellation of treasury stock

(Note 10) — — ( 22,958 ) 22,958 — — — — —

August 6, 2025 (Predecessor) 674 1 10,521 — 7,382 ( 1,464 ) 16,440 873 17,313

Adjustments to Paramount Global’s

basis (Note 2) — — ( 451 ) — ( 7,382 ) 1,464 ( 6,369 ) 376 ( 5,993 )

PIPE Transaction (Note 10) 108 — 1,517 — — — 1,517 — 1,517

Addition of Skydance 314 — 1,589 — ( 1,167 ) — 422 — 422

August 7, 2025 (Successor) 1,096 1 13,176 — ( 1,167 ) — 12,010 1,249 13,259

Stock-based compensation activity 2 — 41 — — — 41 — 41

Common stock dividends — — ( 58 ) — — — ( 58 ) — ( 58 )

Noncontrolling interests — — — — — — — ( 1 ) ( 1 )

Net earnings (loss) — — — — ( 13 ) — ( 13 ) 17 4

Other comprehensive income — — — — — 25 25 1 26

September 30, 2025 (Successor) 1,098 $ 1 $ 13,159 $ — $ ( 1,180 ) $ 25 $ 12,005 $ 1,266 $ 13,271

Nine Months Ended September 30, 2025

Class A and B Common Stock Outstanding Additional Paid-In Capital Treasury

Stock Retained Earnings (Accumulated Deficit) Accumulated Other Comprehensive Income (Loss) Total Paramount Stockholders’ Equity Noncontrolling Interests Total Equity

December 31, 2024 (Predecessor) 671 $ 1 $ 33,394 $ ( 22,958 ) $ 7,487 $ ( 1,604 ) $ 16,320 $ 462 $ 16,782

Stock-based compensation activity 3 — 85 — — — 85 — 85

Common stock dividends — — — — ( 70 ) — ( 70 ) — ( 70 )

Noncontrolling interests — — — — — — — ( 37 ) ( 37 )

Net earnings (loss) — — — — ( 35 ) — ( 35 ) 447 412

Other comprehensive income — — — — — 140 140 1 141

Cancellation of treasury stock (Note 10) — — ( 22,958 ) 22,958 — — — — —

August 6, 2025 (Predecessor) 674 1 10,521 — 7,382 ( 1,464 ) 16,440 873 17,313

Adjustments to Paramount Global’s

basis (Note 2) — — ( 451 ) — ( 7,382 ) 1,464 ( 6,369 ) 376 ( 5,993 )

PIPE Transaction (Note 10) 108 — 1,517 — — — 1,517 — 1,517

Addition of Skydance 314 — 1,589 — ( 1,167 ) — 422 — 422

August 7, 2025 (Successor) 1,096 1 13,176 — ( 1,167 ) — 12,010 1,249 13,259

Stock-based compensation activity 2 — 41 — — — 41 — 41

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Continued)

Three Months Ended March 31, 2026

Class A and B Common Stock Outstanding Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Income (Loss) Total Paramount Stockholders’ Equity Noncontrolling Interests Total Equity

(Successor) (Shares)

December 31, 2025 1,108 $ 1 $ 13,386 $ ( 1,753 ) $ 59 $ 11,693 $ 1,194 $ 12,887

Stock-based compensation activity and other 10 — 7 — — 7 — 7

Common stock dividends — — ( 60 ) — — ( 60 ) — ( 60 )

Noncontrolling interests — — ( 17 ) — — ( 17 ) ( 157 ) ( 174 )

Net earnings (loss) — — — — ( 13 ) — ( 13 ) 17 4

Other comprehensive income — — — — — 25 25 1 26

September 30, 2025 (Successor) 1,098 $ 1 $ 13,159 $ — $ ( 1,180 ) $ 25 $ 12,005 $ 1,266 $ 13,271

See notes to consolidated financial statements.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Continued)

Three Months Ended September 30, 2024

Net earnings — — — 168 — 168 7 175

Other comprehensive loss — — — — ( 86 ) ( 86 ) — ( 86 )

March 31, 2026 1,118 $ 1 $ 13,316 $ ( 1,585 ) $ ( 27 ) $ 11,705 $ 1,044 $ 12,749

Three Months Ended March 31, 2025

Class A and B Common Stock Outstanding Additional Paid-In Capital Treasury

1 unchanged sentence

(Predecessor) (Shares)

June 30, 2024 667 $ 1 $ 33,299 $ ( 22,958 ) $ 7,779 $ ( 1,624 ) $ 16,497 $ 449 $ 16,946

December 31, 2024 671 $ 1 $ 33,394 $ ( 22,958 ) $ 7,487 $ ( 1,604 ) $ 16,320 $ 462 $ 16,782

Stock-based compensation activity 3 — 18 — — — 18 — 18

3 unchanged sentences

Other comprehensive income — — — — — 83 83 1 84

September 30, 2024 667 $ 1 $ 33,364 $ ( 22,958 ) $ 7,745 $ ( 1,524 ) $ 16,628 $ 447 $ 17,075

Nine Months Ended September 30, 2024

Preferred Stock Outstanding Class A and B Common Stock Outstanding Additional Paid-In Capital Treasury

Stock Retained Earnings Accumulated Other Comprehensive Loss Total Paramount Stockholders’ Equity Noncontrolling Interests Total Equity

(Predecessor) (Shares) (Shares)

December 31, 2023 10 $ — 653 $ 1 $ 33,210 $ ( 22,958 ) $ 13,829 $ ( 1,556 ) $ 22,526 $ 524 $ 23,050

— — 2 — 154 — — — 154 — 154

Stock conversion ( 10 ) — 12 — — — — — — — —

Preferred stock

dividends — — — — — — ( 14 ) — ( 14 ) — ( 14 )

dividends — — — — — — ( 104 ) — ( 104 ) — ( 104 )

Noncontrolling

interests — — — — — — — — — ( 115 ) ( 115 )

Net earnings (loss) — — — — — — ( 5,966 ) — ( 5,966 ) 39 ( 5,927 )

Other comprehensive

income (loss) — — — — — — — 32 32 ( 1 ) 31

September 30, 2024 — $ — 667 $ 1 $ 33,364 $ ( 22,958 ) $ 7,745 $ ( 1,524 ) $ 16,628 $ 447 $ 17,075

March 31, 2025 674 $ 1 $ 33,412 $ ( 22,958 ) $ 7,604 $ ( 1,521 ) $ 16,538 $ 390 $ 16,928

See notes to consolidated financial statements.

3 unchanged sentences

1) DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Description of Business —Paramount Skydance Corporation is a global media and entertainment company with a portfolio that includes Paramount Pictures, Paramount Television, CBS, CBS News, CBS Sports, Nickelodeon, MTV, BET, Comedy Central, Showtime, Paramount+, Pluto TV, and Skydance's Animation, Film, Television, Interactive/Games, and Sports divisions.

The Company is comprised of three segments:

TV Media , Direct-to-Consumer , and Filmed Entertainment (see Note 13).

We are in the process of transitioning our reporting structure into three new segments:

Studios, Direct-to-Consumer, and TV Media, which will be completed and reflected in our Quarterly Report on Form 10-Q for the first quarter of 2026.

Description of Business —Paramount Skydance Corporation is a global media and entertainment company with a portfolio that includes Paramount Pictures, Paramount Television, CBS, CBS News, CBS Sports, Nickelodeon, MTV, BET, Comedy Central, Showtime, Paramount+, Pluto TV, and Skydance Animation, Film, Television, Interactive/Games, and Paramount Sports Entertainment.

Beginning in 2026, we transitioned our reporting structure into three new segments:

Studios , Direct-to-Consumer , and TV Media (see Note 13).

References to “Paramount,” the “Company,” “we,” “us” and “our” refer to Paramount Skydance Corporation and its consolidated subsidiaries, unless the context otherwise requires.

The NAI Transaction —On August 7, 2025, pursuant to a purchase and sale agreement dated July 7, 2024, certain affiliates of investors in Skydance Media, LLC (“Skydance”), comprised of entities controlled by the Ellison Family (as defined below), and affiliates of RedBird Capital Partners (collectively the “NAI Equity Investors”), purchased all of the outstanding equity interests of National Amusements, Inc.

(“NAI”), which had previously been the controlling stockholder of Paramount Global, from the shareholders of NAI (the “NAI Transaction”).

The Transactions —Also on August 7, 2025 (the “Closing Date”), following the completion of the NAI Transaction and pursuant to the Transaction Agreement dated as of July 7, 2024, Paramount Global and Skydance became wholly-owned subsidiaries of Paramount Skydance Corporation (the transactions contemplated by the Transaction Agreement, the “Transactions”).

Paramount Skydance Corporation was formerly known as New Pluto Global, Inc., which was formed on June 3, 2024 for purposes of consummating the Transactions and was a wholly-owned direct subsidiary of Paramount Global prior to the closing of the Transactions when, through a series of mergers contemplated by the Transaction Agreement, it became the holding company of Paramount Global and Skydance.

Concurrent with the NAI Transaction, the NAI Equity Investors and certain other affiliates of investors in Skydance made an investment of $ 6.0 billion into Paramount Skydance Corporation (the “PIPE Transaction”) in exchange for 400 million newly issued shares of Class B common stock of Paramount Skydance Corporation (“Paramount Skydance Corporation Class B Common Stock”) for a purchase price of $ 15.00 per share, and the NAI Equity Investors also received warrants to purchase 200 million shares of Paramount Skydance Corporation Class B Common Stock at an initial exercise price of $ 30.50 per share (subject to customary anti-dilution adjustments), which expire five years after issuance.

$ 4.45 billion of the PIPE Transaction investment was used to fund the cash-stock election discussed below and $ 1.52 billion of cash was provided to the Company.

The Transactions also included:

(1) a transaction pursuant to which each outstanding Skydance membership unit held by Skydance investors and each Skydance Phantom Unit was converted into the right to receive the applicable portion of 316.7 million shares of Paramount Skydance Corporation Class B Common Stock ( 313.8 million shares after reduction in connection with certain tax withholding requirements), and (2) a cash-stock election offered to holders of Paramount Global common stock pursuant to which (a) shares of Paramount Global Class A Common Stock held by stockholders other than NAI or its subsidiaries were converted, at the stockholders’ election, into the right to receive either $ 23.00 in cash (“Class A Cash Consideration”) or 1.5333 shares of Paramount Skydance Corporation Class B Common Stock (“Class A Stock Consideration”), and (b) shares of Paramount Global Class B Common Stock held by stockholders other than NAI or its subsidiaries, the NAI Equity Investors and certain other affiliates of investors in Skydance referred to above were converted, at the stockholders’ election, into the right to receive either $ 15.00 in cash (“Class B Cash Consideration”), subject to proration, or one share of Paramount Skydance Corporation Class B Common Stock (“Class B Stock Consideration”).

The shares of Paramount Class A Common Stock held by NAI and its subsidiaries converted into shares of Class A common stock, par value $ 0.001 per share.

Shares of Paramount Global Class A Common Stock for which elections to receive Class A Cash

Discovery Merger —On February 27, 2026, Paramount and Warner Bros.

Discovery, Inc.

(“WBD”) announced a definitive merger agreement (the “WBD Merger Agreement”) under which Paramount will acquire WBD (the “WBD Merger”).

The WBD Merger is expected to close by the end of the third quarter of 2026, subject to customary closing conditions, including regulatory clearances.

Under the terms of the WBD Merger Agreement, Paramount will pay $ 31.00 per WBD share to acquire all outstanding shares of WBD, which at the time of the WBD Merger Agreement represented an equity value of $ 80.9 billion, and will assume WBD’s net debt.

At December 31, 2025, WBD’s debt (excluding finance leases) was comprised of $ 17.8 billion of senior notes and $ 15.0 billion of borrowings from a bridge facility, which we expect to refinance with the debt commitments discussed below.

Furthermore, a per share “ticking fee” of $ 0.00277778 will be paid upon closing by Paramount to WBD stockholders for every day the WBD Merger is not closed past September 30, 2026, up to a maximum of $ 0.25 per WBD share per 90 calendar day period.

Also under the terms of the WBD Merger Agreement, in the first quarter of 2026 Paramount paid a termination fee of $ 2.8 billion to Netflix, Inc.

(“Netflix”) on behalf of WBD in connection with the termination of a prior merger agreement between Netflix and WBD (see Note 15).

This payment was initially funded with cash on hand and a $ 2.15 billion borrowing from our credit facility (see Note 7) and, in accordance with the Subscription Agreements described below, entered into by the Ellison Parties (as defined below), such amount will ultimately be funded by the $ 46.7 billion to be received from the Ellison Parties.

Concurrent with the execution of the WBD Merger Agreement (i) The Lawrence J.

Ellison Revocable Trust, u/a/d 1/22/88, as amended (the “Trust”), and Lawrence J.

Ellison (together with the Trust, the “Ellison Parties”) and (ii) RedBird Capital Partners Fund IV (Master), L.P.

(“RedBird” and, together with the Trust, the “Equity Investors”) entered into subscription agreements (collectively, the “Subscription Agreements”) providing for a private placement investment in Class B common stock of Paramount Skydance Corporation (“Paramount Skydance Corporation Class B Common Stock”), for an aggregate amount of up to $ 46.7 billion (subject to increase if the Ticking Consideration, as defined in the WBD Merger Agreement or certain other additional amounts as defined in the WBD Merger Agreement are required) from the Trust and $ 250 million from RedBird pursuant to the terms of the Subscription Agreements.

In April 2026, we announced that the Equity Investors had determined, as permitted under the Subscription Agreements, to assign their subscription rights thereunder (the “Equity Syndication”) to a group of institutional investors (each, an "Equity Syndication Party"), comprising affiliates of the Ellison Parties and RedBird, The Public Investment Fund, L'Imad 1st SPV 2 Exempt RSC LTD (an investment vehicle of L'Imad Holding, an Abu Dhabi sovereign wealth fund), QIA TMT Holding LLC (an investment vehicle of the Qatar Investment Authority), and LionTree Investment Fund, L.P.

The aggregate allocations cover the full amount committed by the Equity Investors.

At closing, Paramount will issue to each Equity Syndication Party a number of newly issued nonvoting Paramount Skydance Corporation Class B shares (or securities convertible into shares) equal to its allocated amount divided by the Syndication Purchase Price, defined as the 20 -trading-day daily volume-weighted average price of Paramount Skydance Corporation Class B Common Stock determined as of the third business day prior to

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

1 unchanged sentence

(Tabular dollars in millions, except per share amounts)

Consideration or Class A Stock Consideration were not made or were validly revoked were automatically converted into Class A Stock Consideration.

the closing of the WBD Merger, subject to a ceiling of $ 16.02 per share and a floor of $ 12.00 per share.

This syndication does not relieve the Equity Investors of their contractual commitments made to the Company.

Following the closing, the Ellison Family (as defined below) and RedBird will remain the sole holders of Paramount Class A Common Stock, representing 100 % of the voting shares of Paramount.

For the purpose of determining the controlling ownership of Paramount, the Ellison family is comprised of Lawrence J.

Ellison and David Ellison (the “Ellison Family”).

David Ellison is the son of Lawrence J.

Ellison, and Lawrence J.

Ellison and David Ellison are accordingly considered immediate family members.

We have also secured commitments for debt financing totaling $ 54 billion, which include a $ 49 billion 364-day senior secured bridge loan facility, which we plan to reduce or replace with permanent financing (which may include issuance of debt securities) on or prior to the closing of the WBD Merger and, in connection with a credit agreement entered into in April 2026 (the “Pro Rata Credit Agreement”), $ 2.50 billion three-year senior secured term A loans and $ 2.50 billion five-year senior secured term A loans.

The term A loans will be made in a single borrowing on the closing date of the WBD Merger.

We expect to use the committed financing to refinance the $ 15.0 billion WBD bridge facility.

The Pro Rata Credit Agreement also provides for a $ 5.00 billion five-year senior secured revolving credit facility, which will be used for general corporate purposes, and will replace our existing revolving credit facility (see Note 7).

The availability and initial funding of the facilities under the Pro Rata Credit Agreement and the bridge loan facility (if not replaced by permanent financing) are subject to the satisfaction or waiver of customary conditions set forth in the Pro Rata Credit Agreement and the bridge commitment papers, including the closing of the WBD Merger.

Also in April 2026, we announced that, in lieu of a previously planned rights offering at $ 16.02 per share, each holder of Paramount Skydance Corporation Class B Common Stock (excluding any Equity Investor or affiliate thereof) as of a record date to be determined will receive, without payment of any consideration, one 10-year warrant (each, a "Warrant") for each share held, exercisable at any initial exercise price per share equal to the Syndication Purchase Price and subject to customary anti-dilution and fundamental change make-whole adjustments.

Beginning on the third anniversary of issuance, we may call the Warrants if the closing price of our Class B Common Stock equals or exceeds $ 30.00 for at least 20 trading days in any 30 consecutive trading day period.

Paramount intends to apply to list the Warrants for trading on Nasdaq separately from the Class B Common Stock, subject to applicable approvals.

If antitrust or regulatory approval for the WBD Merger is not received, Paramount will owe WBD a $ 7.0 billion termination fee.

In accordance with the Subscription Agreements, this termination fee and the previously paid $ 2.8 billion Netflix termination fee described above would be funded by the Ellison Parties in exchange for shares of Paramount Skydance Corporation Class B Common Stock at $ 16.02 per share.

WBD will owe Paramount a $ 3.0 billion termination fee under certain circumstances, including if WBD terminates the WBD Merger Agreement to enter into a definitive agreement for an alternative acquisition proposal.

The NAI Transaction —On August 7, 2025, pursuant to a purchase and sale agreement dated July 7, 2024, certain affiliates of investors in Skydance Media, LLC (“Skydance”), comprised of entities controlled by the Ellison Family and affiliates of RedBird Capital Partners (collectively the “NAI Equity Investors”), purchased all of the outstanding equity interests of Paramount Global’s controlling stockholder, National Amusements, Inc.

(“NAI”) from the shareholders of NAI (the “NAI Transaction”).

The Skydance Transactions —Also on August 7, 2025, following the completion of the NAI Transaction and pursuant to the Transaction Agreement dated as of July 7, 2024, Paramount Global and Skydance became wholly-owned subsidiaries of Paramount Skydance Corporation (the transactions contemplated by the Transaction

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

Agreement, the “Skydance Transactions”).

Paramount Skydance Corporation, formerly known as New Pluto Global, Inc., was formed on June 3, 2024 to consummate the Transactions and was a wholly-owned direct subsidiary of Paramount Global until, through a series of mergers, it became the holding company of Paramount Global and Skydance as part of the Skydance Transactions.

Concurrent with the NAI Transaction, the NAI Equity Investors and certain other affiliates of investors in Skydance made an investment of $ 6.0 billion into Paramount Skydance Corporation (the “PIPE Transaction”) in exchange for 400 million newly issued shares of Paramount Skydance Corporation Class B Common Stock for a purchase price of $ 15.00 per share, and the NAI Equity Investors also received warrants to purchase 200 million shares of Paramount Skydance Corporation Class B Common Stock at an initial exercise price of $ 30.50 per share (subject to customary anti-dilution adjustments), which expire five years after issuance.

$ 4.45 billion of the PIPE Transaction investment was used to fund the cash-stock election discussed below and $ 1.52 billion of cash was provided to the Company.

The Skydance Transactions also included:

The shares of Paramount Class A Common Stock held by NAI and its subsidiaries converted into shares of Class A common stock, par value $ 0.001 per share.

Shares of Paramount Global Class A Common Stock for which elections to receive Class A Cash Consideration or Class A Stock Consideration were not made or were validly revoked were automatically converted into Class A Stock Consideration.

Shares of Paramount Global Class B Common Stock for which elections to receive Class B Cash Consideration were not made or were validly revoked were converted automatically into one share of Paramount Skydance Corporation Class B Common Stock.

Shares of Paramount Skydance Corporation Class B Common Stock now trade on the Nasdaq Stock Market LLC (“Nasdaq”) under the ticker symbol “PSKY”.

All shares of Paramount Global Class A Common Stock and Class B Common Stock have been delisted from Nasdaq and have been cancelled and ceased to exist.

Shares of Paramount Skydance Corporation Class B Common Stock trade on the Nasdaq Stock Market LLC (“Nasdaq”) under the ticker symbol “PSKY.” All shares of Paramount Global Class A Common Stock and Class B Common Stock have been delisted from Nasdaq and have been cancelled and cease to exist.

Holders of shares of Class A common stock of Paramount Skydance Corporation (“Paramount Skydance Corporation Class A Common Stock”) are entitled to one vote per share with respect to all matters on which the holders of Paramount Skydance Corporation common stock are entitled to vote.

Holders of Paramount Skydance Corporation Class B Common Stock do not have voting rights.

Following the closing of the Transactions and the NAI Transaction, NAI, which was renamed Harbor Lights Entertainment, Inc., and its subsidiaries held 100.0 % of the Paramount Skydance Corporation Class A Common Stock.

Accordingly, entities controlled by the Ellison Family (as defined below) indirectly hold approximately 77.5 % of the Paramount Skydance Corporation Class A Common Stock through their collective approximate 77.5 % ownership interest in Harbor Lights Entertainment, Inc., and as a result the Ellison Family is the controlling stockholder of Paramount.

For the purpose of determining the controlling ownership of Paramount, the Ellison family is comprised of Lawrence Ellison and David Ellison (the “Ellison Family”).

David Ellison is the son of Lawrence Ellison, and Lawrence Ellison and David Ellison are accordingly considered immediate family members.

The Ellison Family either individually or through ownership of various entities are collectively the ultimate parent of Paramount (“Ultimate Parent”).

Pushdown of Ultimate Parent’s Basis — At the time Paramount Global and Skydance became subsidiaries of Paramount Skydance Corporation, the Ellison Family controlled both Paramount Global and Skydance, and as a result, this transaction has been accounted for as a transaction between entities under common control.

As a transaction between entities under common control, the net assets were combined at the Ultimate Parent’s basis, which for Paramount Global was deemed to be the estimated fair value as of August 7, 2025, the date of the closing of the NAI Transaction, which was the point at which the Ellison Family obtained control of Paramount Global (see Note 2).

As a result, the net assets of Paramount Global were recorded at their fair value as of this date.

Since the net assets of Skydance were already at the Ultimate Parent’s basis, no adjustment to the fair value of net assets was necessary, and Skydance was combined with Paramount Global’s net assets at the Ultimate Parent’s basis as of this date.

Our consolidated financial statements and footnote disclosures are presented in two distinct periods to indicate the pushdown of the Ultimate Parent’s basis, which resulted in a new basis of accounting.

The periods prior to the closing of the Transactions include only Paramount Global and are identified as “Predecessor”, and the periods beginning on August 7, 2025 reflect Paramount Skydance Corporation and are identified as “Successor”.

Due to the application of pushdown accounting, the results of operations, financial position and cash flows are not comparable between the Successor and Predecessor periods.

Paramount Global has been identified as the predecessor entity to Paramount Skydance Corporation based on the relative size and fair value of Paramount Global and Skydance, and the fact that Paramount Global was an existing publicly traded company prior to the completion of the Transactions.

No single factor was the sole determinant in the overall conclusion that Paramount Global is the predecessor;

rather all factors were considered in arriving at such conclusion.

Following the closing of the Skydance Transactions and the NAI Transaction, NAI, which was renamed Harbor Lights Entertainment, Inc., and its subsidiaries hold 100.0 % of the Paramount Skydance Corporation Class A Common Stock.

Accordingly, entities controlled by the Ellison Family indirectly hold approximately 77.5 % of the Paramount Skydance Corporation Class A Common Stock through their collective approximate 77.5 % ownership interest in Harbor Lights Entertainment, Inc., and as a result the Ellison Family is the controlling stockholder and the ultimate parent of Paramount (“Ultimate Parent”).

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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(Tabular dollars in millions, except per share amounts)

Pushdown of Ultimate Parent’s Basis —At the time Paramount Global and Skydance became subsidiaries of Paramount Skydance Corporation, the Ellison Family controlled both Paramount Global and Skydance, and as a result, this transaction has been accounted for as a transaction between entities under common control.

As a result, the net assets of Paramount Global were recorded at their fair values as of this date.

Due to the pushdown of the Ultimate Parent’s basis, which resulted in a new basis of accounting, the results of operations, financial position and cash flows are not comparable between the Successor and Predecessor periods.

Accordingly, our consolidated financial statements and footnote disclosures are presented in distinct periods.

The periods prior to the closing of the Skydance Transactions and the NAI Transaction include only Paramount Global and are identified as “Predecessor,” and the periods beginning on August 7, 2025 reflect Paramount Skydance Corporation and are identified as “Successor.” In addition, we are required to present segment information for the Predecessor period based on our previous segments, Filmed Entertainment, Direct-to-Consumer, and TV Media (see Note 13).

Basis of Presentation— The accompanying unaudited consolidated financial statements have been prepared on a basis consistent with accounting principles generally accepted in the United States (“U.S.

GAAP” or “GAAP”) for interim financial information and pursuant to the rules of the Securities and Exchange Commission.

These financial statements should be read in conjunction with the more detailed financial statements and notes thereto included in the Annual Report on Form 10-K of our Predecessor, Paramount Global, for the year ended December 31, 2024.

These financial statements should be read in conjunction with the more detailed financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2025.

In the opinion of management, the accompanying unaudited consolidated financial statements reflect all adjustments, consisting only of normal and recurring adjustments, necessary for a fair statement of our financial position, results of operations and cash flows for the periods presented.

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Actual results may vary from these estimates under different assumptions or conditions.

Change in Accounting Estimate— FCC licenses have historically been classified as indefinite-lived intangible assets.

However, as a result of sustained declines in industry projections, including in long-term growth rate assumptions, we reassessed this classification and determined that FCC licenses would be classified as finite-lived intangible assets.

Accordingly, during the third quarter of 2025, we began amortizing FCC licenses on a straight-line basis over a period of 30 years.

As of September 30, 2025, the unamortized FCC licenses balance was $ 2.49 billion, which was included within “Intangible assets, net” on the Consolidated Balance Sheet.

Net Earnings (Loss) per Common Share— Basic net earnings (loss) per share (“EPS”) is based upon net earnings (loss) available to common stockholders divided by the weighted average number of common shares outstanding during the period.

Net earnings (loss) available to common stockholders is calculated as net earnings (loss) from continuing operations or net earnings (loss), as applicable, adjusted to include a reduction for dividends recorded during the applicable Predecessor period on Paramount Global’s 5.75 % Series A Mandatory Convertible Preferred Stock (“Mandatory Convertible Preferred Stock”).

On April 1, 2024, all outstanding shares of Mandatory Convertible Preferred Stock were automatically and mandatorily converted into shares of Paramount Global Class B Common Stock.

The final dividend on the Mandatory Convertible Preferred Stock was declared during the first quarter of 2024 and paid on April 1, 2024 (see Note 10).

Net Earnings per Common Share— Basic net earnings per share (“EPS”) is based upon net earnings available to common stockholders divided by the weighted average number of common shares outstanding during the period.

Weighted average shares for diluted EPS reflect the effect of the assumed exercise of stock options and warrants, and vesting of restricted share units (“RSUs”) or performance share units only in the periods in which such effect would have been dilutive.

In periods prior to the preferred stock conversion described above, diluted EPS also reflected the effect of the assumed conversion of preferred stock, when dilutive, which included the issuance of common shares in the weighted average number of shares and excluded the above-mentioned preferred stock dividend adjustment to net earnings (loss) available to common stockholders.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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The tables below present a reconciliation of weighted average shares used in the calculation of basic and diluted EPS.

The table below presents stock options, RSUs, and warrants excluded from the calculations of diluted EPS because their inclusion would have been antidilutive.

Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

Three Months Ended March 31, Three Months Ended March 31,

(in millions) 2026 2025

Weighted average shares for basic EPS 1,098 675 667

Dilutive effect of shares issuable under stock-based

compensation plans

Weighted average shares for diluted EPS 1,098 675 670

Stock options and RSUs 64 5

Warrants 200 —

The table below presents a reconciliation of weighted average shares used in the calculation of basic and diluted EPS.

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

Three Months Ended March 31, Three Months Ended March 31,

(in millions) 2026 2025

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Weighted average shares for diluted EPS 1,118 678

The tables below present stock options, RSUs, and warrants excluded from the calculations of diluted EPS.

In each period except for the three months ended September 30, 2024, all outstanding stock options, RSUs, and warrants were excluded because their inclusion would have been antidilutive because we reported a net loss.

Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

(in millions) 2025 2025 2024

Stock options and RSUs 66 32 10

Warrants 200 — —

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

(in millions) 2025 2025 2024

Stock options and RSUs 66 33 30

Warrants 200 — —

Also excluded from the calculation of diluted EPS for the nine months ended September 30, 2024 (Predecessor) prior to the preferred stock conversion discussed above, was the effect of the assumed conversion of 10 million shares of Paramount Global’s Mandatory Convertible Preferred Stock into shares of common stock because the impact would have been antidilutive.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

Because the impact of the assumed conversion of Paramount Global’s Mandatory Convertible Preferred Stock would have been antidilutive, net loss from continuing operations and net loss used in our calculations of diluted EPS for the nine months ended September 30, 2024 (Predecessor) included a reduction of $ 14 million for the preferred stock dividends recorded during the period.

Net loss from continuing operations and net loss used in the calculations of basic and diluted EPS were $ 5.99 billion and $ 5.98 billion, respectively.

Accounting Pronouncements Not Yet Adopted

In December 2023, the Financial Accounting Standards Board (“FASB”) issued guidance enhancing annual income tax disclosures.

Under this guidance, certain enhancements to the effective tax rate reconciliation disclosure are required, including the disclosure of both percentages and amounts, specific categories, and additional information for reconciling items meeting a quantitative threshold defined by the guidance.

Additionally, disclosures of income taxes paid and income tax expense must be disaggregated by federal, state and foreign taxes, with income taxes paid further disaggregated for individual jurisdictions that represent 5 percent or more of total income taxes paid.

The guidance is effective for us for the year ended December 31, 2025, and may be applied either prospectively or retrospectively.

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued guidance requiring disclosure in the notes to the financial statements of the disaggregation of relevant expense captions on the income statement into specified expense categories, including employee compensation, as well as disclosure of total selling expenses.

In November 2024, the Financial Accounting Standards Board (“FASB”) issued guidance requiring disclosure in the notes to the financial statements of the disaggregation of relevant expense captions on the income statement into specified expense categories, including employee compensation, as well as disclosure of total selling expenses.

The guidance is effective for us for the year ended December 31, 2027, and for all interim and annual periods thereafter, and may be applied either prospectively or retrospectively.

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The guidance is effective for us for the year ended December 31, 2028, including interim periods within that year, and may be adopted prospectively, retrospectively, or using a modified transition approach for projects in process.

We are currently evaluating the impact of this guidance on our consolidated financial statements.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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2) PUSHDOWN OF ULTIMATE PARENT'S BASIS

The NAI Transaction resulted in a change in control of our Predecessor, Paramount Global, that established a new accounting basis, which reflects the estimated fair value of Paramount Global as indicated by the NAI Transaction and the Transactions.

The table below presents the calculation of the Ultimate Parent's basis in Paramount Global as of the date these transactions closed.

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(a) In the NAI Transaction, the NAI Equity Investors purchased all of the outstanding equity interests of NAI.

Based on preliminary valuation analyses of NAI’s assets and liabilities, the estimated value attributable to the shares of Paramount Global common stock held by NAI and its subsidiaries is approximately $ 2.0 billion.

The fair value estimates assumed herein may differ materially based on the finalization of appraisals and other valuation analyses.

(b) Reflects cash paid to holders of Paramount Global Class A Common Stock and Paramount Global Class B Common Stock who elected to receive the Class A Cash Consideration and Class B Cash Consideration of $ 23.00 per share and $ 15.00 per share, respectively, in the Transactions.

Based on valuation analyses of NAI’s assets and liabilities, the estimated value attributable to the shares of Paramount Global common stock held by NAI and its subsidiaries is $ 2.1 billion.

This amount increased $ 107 million from the preliminary estimate included in our quarterly report on Form 10-Q for the third quarter of 2025, which resulted in an increase in Paramount Global’s basis in this amount.

Such payout was funded by the $ 6.0 billion PIPE Transaction.

(c) Reflects the fair value of outstanding Paramount Global RSU Awards and Paramount Global PSU Awards attributable to employees’ service prior to the Transactions and the NAI Transaction.

(c) Reflects the fair value of outstanding Paramount Global RSU Awards and Paramount Global PSU Awards attributable to employees’ service prior to the Skydance Transactions and the NAI Transaction.

The fair value is based on the closing stock price of Paramount Global Class B Common Stock on August 6, 2025 of $ 11.04 per share.

The remaining fair value of outstanding Paramount Global RSU Awards and Paramount PSU Awards, which were assumed by Paramount Skydance Corporation and converted into awards of restricted stock units covering an equivalent number of shares of Paramount Skydance Corporation Class B Common Stock are being expensed over their remaining vesting periods.

(d) Reflects 318.8 million shares of Paramount Skydance Corporation Class B Common Stock owned by holders of Paramount Global Class A and Paramount Global Class B Common Stock following the Transactions, other than those held directly or indirectly by NAI or its affiliates, not converted into cash, valued at the closing stock price of Paramount Global Class B Common Stock on August 6, 2025 of $ 11.04 per share.

The remaining fair value of outstanding Paramount Global RSU Awards and Paramount Global PSU Awards, which were assumed by Paramount Skydance Corporation and converted into awards of restricted stock units covering an equivalent number of shares of Paramount Skydance Corporation Class B Common Stock are being expensed over their remaining vesting periods.

(d) Reflects 318.8 million shares of Paramount Skydance Corporation Class B Common Stock owned by holders of Paramount Global Class A and Paramount Global Class B Common Stock following the Skydance Transactions, other than those held directly or indirectly by NAI or its affiliates, not converted into cash, valued at the closing stock price of Paramount Global Class B Common Stock on August 6, 2025 of $ 11.04 per share.

Certain holders of Paramount Global Class A Common Stock received the Class A Stock Consideration, which resulted in the conversion of 2.0 million shares of Paramount Global Class A Common Stock into approximately 3.1 million shares of Paramount Skydance Corporation Class B Common Stock, based on the exchange ratio of one share of Paramount Global Class A Common Stock to 1.5333 shares of Paramount Skydance Corporation Class B Common Stock.

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The table below details the preliminary estimated fair values of Paramount Global’s assets, liabilities and noncontrolling interests at the Ultimate Parent's basis as of August 7, 2025.

The table below details the preliminary estimated fair values of Paramount Global’s assets, liabilities and noncontrolling interests at the Ultimate Parent's basis as of August 7, 2025, including measurement period adjustments recorded subsequent to the third quarter of 2025.

The impact on our statement of operations in the first quarter of 2026 from the amounts that would have been recognized in the third quarter of 2025 had these measurement period adjustments been recognized as of the acquisition date were not material.

The fair values were determined based on valuation techniques that use unobservable inputs (Level 3 in the fair value hierarchy).

Significant judgments in these valuations include long-term projections, discount rates, royalty rates, and decay rates.

We continue to evaluate these estimated fair values, in particular those related to programming, intangible assets, taxes, and contingencies, which may differ materially based upon the finalization of appraisals and other valuation analyses, which are expected no later than one year from the Closing Date.

Preliminary Allocation of Ultimate Parent’s Basis

We continue to evaluate these estimated fair values, in particular those related to programming, intangible assets, and contingencies, which may differ based upon the finalization of appraisals and other valuation analyses, which are expected no later than one year from the August 7, 2025 closing date of the Skydance Transactions and the NAI Transaction.

Allocation of Ultimate Parent’s Basis

Preliminary Measurement Period Adjustments Preliminary, Revised

Cash and cash equivalents $ 3,977 $ — $ 3,977

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Property and equipment, net (a)

2,118 ( 2 ) 2,116

Programming and other inventory, noncurrent (b)

13,599 ( 347 ) 13,252

947 452 1,399

Intangible assets, net (d)

6,748 8 6,756

Operating lease assets 875 39 914

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Long-term debt (e)

$ 13,619 $ — $ 13,619

Pension and postretirement benefit obligations (f)

1,390 — 1,390

Deferred income tax liabilities, net

306 ( 65 ) 241

Operating lease liabilities 1,219 ( 3 ) 1,216

Programming obligations (g)

2,017 ( 54 ) 1,963

Other liabilities (h)

10,137 192 10,329

Total liabilities $ 28,688 $ 70 $ 28,758

Noncontrolling interests (i)

1,249 ( 73 ) 1,176

Paramount Global basis at August 7, 2025 $ 11,588 $ 107 $ 11,695

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For certain content, fair value was determined to be equivalent to net book value.

The fair value reflects a net decrease to the book value of programming assets of $ 131 million principally from reductions for programming at our TV Media and Direct-to-Consumer segments offset by an increase to the fair value of our film and television libraries.

(c) Goodwill substantially all relates to the Direct-to-Consumer segment and represents the difference between Paramount Global’s basis and the fair value of its net assets based on the preliminary fair value estimates assumed herein.

Goodwill reflects operating synergies between our businesses, as well as anticipated cost savings and is not deductible for tax purposes.

(d) The table below presents our intangible assets by asset class, as well as the valuation method used to determine the estimated fair values, and the related estimated weighted average useful lives.

The weighted average useful life of the total intangibles below is 16.6 years.

The fair value reflects a net decrease to the book value of

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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programming assets of $ 544 million principally from reductions for programming at our TV Media and Direct-to-Consumer segments offset by an increase to the fair value of our film and television libraries.

(c) Goodwill relates principally to the Direct-to-Consumer segment and represents the difference between Paramount Global’s basis and the fair value of its net assets based on the preliminary fair value estimates assumed herein.

Goodwill reflects operating synergies between our businesses, as well as anticipated cost savings and is not deductible for tax purposes.

The weighted average useful life of the total intangibles below is 16.6 years.

Intangible assets Values Valuation Method Estimated weighted average straight-line amortization period

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(g) “Programming Obligations” include $ 514 million recorded to establish liabilities for unfavorable contractual arrangements.

(h) The estimated fair value of Paramount Global’s contingent liabilities as of August 7, 2025 was $ 1.3 billion, which relate principally to the defense and settlement of lawsuits claiming various personal injuries related to exposure to asbestos as well as claims from federal and state environmental regulatory agencies and other entities asserting liability for environmental cleanup costs and related damages (see Note 14).

(h) The estimated fair value of Paramount Global’s contingent liabilities as of August 7, 2025 was $ 1.4 billion, which relates principally to the defense and settlement of lawsuits claiming various personal injuries related to exposure to asbestos as well as claims from federal and state environmental regulatory agencies and other entities asserting liability for environmental cleanup costs and related damages (see Note 14).

(i) The fair value was determined based on a discounted cash flow analysis.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

3) PROGRAMMING AND OTHER INVENTORY

The following table presents our programming and other inventory at September 30, 2025 and December 31, 2024, grouped by type and predominant monetization strategy.

Successor Predecessor

September 30, 2025 December 31, 2024

The following table presents our programming and other inventory at March 31, 2026 and December 31, 2025, grouped by type and predominant monetization strategy.

March 31, 2026 December 31, 2025

Film Group Monetization:

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Total noncurrent programming and other inventory $ 15,472 $ 15,028

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

The following tables present amortization of our television and film programming and production costs, which is included within “ Operating expenses ” on the Consolidated Statements of Operations.

Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

2025 2025 2024

Licensed program rights $ 743 $ 333 $ 1,068

Produced television and film

programming, and acquired libraries:

Individual monetization $ 264 $ 125 $ 405

Film group monetization $ 610 $ 522 $ 1,158

The following table presents amortization of our television and film programming and production costs, which is included within “ Operating expenses ” on the Consolidated Statements of Operations.

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024

Three Months Ended March 31, Three Months Ended March 31,

Licensed program rights $ 1,681 $ 1,511

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Film group monetization $ 1,037 $ 1,299

Programming Charges (Predecessor)

Programming charges totaling $ 1.12 billion recorded during the first quarter of 2024 were the result of major changes in content strategy.

These changes, which were made in connection with a shift to a global programming strategy, resulted in the removal of significant levels of content from our platforms, abandonment of development projects, and termination of programming agreements, particularly internationally, including locally-produced content and domestic titles that no longer aligned with a shift to a global programming strategy.

The removal of this content from our platforms was a triggering event that required an assessment of whether the affected programming assets were impaired.

This impairment review compared the current carrying value of each title with its fair value, which considered (1) that the titles were no longer being utilized on our platforms and there was no intention to use the titles on our platforms in the future and (2) the estimated future cash flows associated with any anticipated licensing of the titles to third parties, which was minimal.

The programming charges were comprised of $ 909 million for the impairment of content to its estimated fair value, as well as $ 209 million for development cost write-offs and contract termination costs.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

4) RESTRUCTURING, TRANSACTION-RELATED ITEMS, AND IMPAIRMENT

During the periods presented we recorded the following restructuring charges and transaction-related items.

Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

2025 2025 2024

Restructuring charges (a)

$ 185 $ 13 $ 288

Transaction-related items — 175 33

4) RESTRUCTURING AND TRANSACTION-RELATED ITEMS

During the three months ended March 31, 2026 and 2025, we recorded the following within “Restructuring and transaction-related items” on the Consolidated Statements of Operations.

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024

Severance (a)

185 $ 190 $ 513

Exit costs — 65 31

Three Months Ended March 31, Three Months Ended March 31,

Restructuring charges $ — $ 65

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Restructuring and transaction-related items $ 103 $ 85

(a) Severance costs include the accelerated vesting of stock-based compensation.

Restructuring Charges

Restructuring charges for the period from August 7 - September 30, 2025 (Successor) were comprised of severance costs of $ 185 million, principally associated with actions to align the business around our strategic priorities following the Transactions, including costs related to a plan under which severance payments are being provided to certain eligible employees who voluntarily elected to participate.

Restructuring charges for the Predecessor periods from July 1 - August 6, 2025 and January 1 - August 6, 2025 included severance costs of $ 13 million and $ 190 million, respectively, primarily associated with strategic changes in the global workforce in order to streamline the organization.

Restructuring charges for the three and nine months ended September 30, 2024 (Predecessor) included severance costs of $ 288 million and $ 513 million, respectively, associated with strategic changes in our global workforce, and for the nine-month period also related to the exit of Paramount Global’s former CEO and other management changes.

Additionally, during the period from January 1 - August 6, 2025 (Predecessor) and the nine months ended September 30, 2024 (Predecessor), we recorded exit costs of $ 65 million and $ 31 million, respectively, primarily for the impairment of lease assets that we ceased use of in connection with initiatives to reduce our real estate footprint and create cost synergies.

The impairments were primarily the result of a decline in market conditions since the inception of these leases and reflect the difference between the estimated fair values, which were determined based on the expected future cash flows of the lease assets, and the carrying values.

The following is a rollforward of our restructuring severance liability, which is recorded in “Other current liabilities” and “Other liabilities” on the Consolidated Balance Sheets, and is expected to be substantially paid by the end of 2026.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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2025 Activity (Predecessor) 2025 Activity (Successor)

Balance at December 31, 2024 Charges (a)

Payments and other Charges (a)

Payments and other Balance at September 30, 2025

TV Media $ 156 $ 141 $ ( 98 ) $ 74 $ ( 32 ) $ 241

Restructuring Charges

During the three months ended March 31, 2025, we recorded exit costs of $ 65 million, primarily for the impairment of lease assets that we ceased use of in connection with initiatives to reduce our real estate footprint and create cost synergies.

2026 Activity

Balance at December 31, 2025

and other Balance at March 31, 2026

Studios $ 133 $ ( 25 ) $ 108

Direct-to-Consumer 53 ( 14 ) 39

Filmed Entertainment 46 17 ( 28 ) 43 ( 6 ) 72

TV Media 384 ( 113 ) 271

Corporate 135 ( 6 ) 129

Total $ 705 $ ( 158 ) $ 547

(a) Excludes stock-based compensation expense of $ 30 million and $ 14 million for the periods from August 7 - September 30, 2025 (Successor) and January 1 - August 6, 2025 (Predecessor), respectively.

Transaction-Related Items

During the Predecessor periods from July 1 - August 6, 2025 and January 1 - August 6, 2025, we recorded $ 175 million and $ 199 million, respectively principally for banking, legal, advisory, and other professional fees relating to the Transactions, and transaction awards that became payable to eligible employees upon closing.

During the three and nine months ended September 30, 2024, we recorded transaction-related costs of $ 33 million and $ 51 million, respectively associated with legal and advisory fees related to the Transactions.

Interim Impairment Testing (Predecessor)

FCC Licenses— For the second quarter of 2025 (Predecessor), as a result of recent declines in industry projections, interim impairment tests were necessary for six markets in which we hold FCC licenses.

We consider each geographic market, which is comprised of all of our television stations within that geographic market, to be a single unit of accounting because the FCC licenses at this level represent their highest and best use, and accordingly FCC licenses were tested for impairment at the geographic market level.

The FCC licenses impairment tests were performed using the Greenfield Discounted Cash Flow Method, which estimates the fair values of FCC licenses by valuing a hypothetical start-up station in the relevant market by adding discounted cash flows over a five-year build-up period to a residual value.

The assumptions for the build-up period include industry projections of overall market revenues;

the start-up station’s operating costs and capital expenditures, which are based on both industry and internal data;

and average market share.

The discount rate is determined based on the industry and market-based risk of achieving the projected cash flows, and the residual value is calculated using a long-term growth rate, which is based on projected industry projections and long-range inflation.

The discount rate and the long-term growth rate were 7.5 % and ( 2 )%, respectively.

The impairment tests indicated that the estimated fair values of FCC licenses in each of the six markets tested were below their respective carrying values.

Accordingly, an impairment charge was recorded during the second quarter of 2025 of $ 157 million to write down the carrying values of these FCC licenses to their aggregate estimated fair value.

During the second quarter of 2024, interim impairment tests were performed for eight markets in which we hold FCC licenses.

The tests indicated that the estimated fair values of FCC licenses in two of the eight markets were below their respective carrying values.

Accordingly, an impairment charge of $ 15 million was recorded to write down the carrying values of these FCC licenses to their estimated fair values.

The impairment charges in each year were recorded within the TV Media segment.

During the third quarter of 2024, as a result of a further decline in industry-projected long-term growth rates, an interim impairment test was performed for each of our 14 markets with FCC license book values.

The tests indicated that the estimated fair values of FCC licenses in five of the 14 markets were below their respective

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

carrying values.

Accordingly, an impairment charge of $ 104 million was recorded during the three months ended September 30, 2024, to write down the carrying values of FCC licenses in these five markets to their aggregate estimated fair value.

The impairment charge, which was recorded within the TV Media segment, was primarily the result of a reduction in the long-term growth rate utilized in the impairment tests to ( 2 )%.

The estimated fair values of FCC licenses in the remaining nine markets exceeded their carrying values by more than 10 %.

Goodwill— For the second quarter of 2024, the relevant factors that could impact the fair value of Paramount Global’s reporting units were assessed, including indicators in the linear affiliate marketplace and the estimated total company market value indicated by the Transactions and the NAI Transaction announced on July 7, 2024.

Based on this assessment, an interim goodwill impairment test was performed for each reporting unit.

The goodwill impairment test for the Cable Networks reporting unit indicated that an impairment charge of $ 5.98 billion was required, which represented the goodwill balance of the reporting unit prior to the impairment test.

The impairment charge, which was recorded within the TV Media segment, resulted from a downward adjustment to the reporting unit’s expected cash flows, primarily because of the linear affiliate market indicators noted above, and the estimated total company market value indicated by the Transactions and the NAI Transaction.

During the three months ended March 31, 2026, we recorded $ 103 million of transaction-related costs, principally for legal, advisory, and other professional fees associated with the planned WBD Merger.

During the three months ended March 31, 2025, we recorded legal, advisory, and other professional fees relating to the Skydance Transactions of $ 20 million.

5) RELATED PARTIES

The Ellison Family (Successor)

Following the closing of the Transactions and the NAI Transaction, the Ellison Family indirectly holds approximately 77.5 % of our voting Class A Common Stock through their collective approximate 77.5 % ownership interest in Harbor Lights Entertainment, Inc.

(f/k/a National Amusements, Inc.), and as a result is the controlling stockholder of Paramount (see Note 1).

At March 31, 2026, the Ellison Family, the controlling stockholder of Paramount, indirectly held approximately 77.5 % of our voting Class A Common Stock through their collective approximate 77.5 % ownership interest in Harbor Lights Entertainment, Inc.

(f/k/a National Amusements, Inc.) and 47.3 % of our Class A and non-voting Class B Common Stock on a combined basis.

In addition, in connection with the PIPE Transaction, the NAI Equity Investors (including entities controlled by the Ellison Family) received warrants to purchase a total of 200 million shares of Paramount Skydance Corporation Class B Common Stock (of which entities controlled by the Ellison Family received warrants to purchase a total of 155 million shares) at an initial exercise price of $ 30.50 per share (subject to customary anti-dilution adjustments), which expire five years after issuance.

The Ellison Family is comprised of Lawrence Ellison and David Ellison.

David Ellison is the son of Lawrence Ellison, and Lawrence Ellison and David Ellison are accordingly considered immediate family members.

The Ellison Family is comprised of Lawrence J.

Ellison and David Ellison.

David Ellison is the son of Lawrence J.

Ellison, and Lawrence J.

Ellison and David Ellison are accordingly considered immediate family members.

David Ellison is the CEO of Paramount and the Chairman of our Board of Directors.

Lawrence Ellison is the Chairman and a major stockholder of Oracle Corporation (“Oracle”).

We have several multi-year Software as a Service (SaaS) agreements with Oracle, principally for finance and human resources, as well as Oracle software support agreements and database licenses used by various applications.

The total payments related to these arrangements from August 7 - September 30, 2025 were $ 2 million.

In addition, we have lease agreements under which the lessor is an entity owned and controlled by Lawrence Ellison.

At September 30, 2025, the total liability associated with these leases was $ 191 million.

During the period from August 7 - September 30, 2025 we recorded lease costs associated with these leases totaling $ 4 million.

The Ellison Family has investments in other entities over which they have control or can exert significant influence, which as a result, are related parties to us.

We did not have any material transactions with these entities.

Ellison is the Chairman and a significant stockholder of Oracle Corporation (“Oracle”).

We have several multi-year software as a service agreements with Oracle, principally for finance and human resources, as well as software support agreements and database licenses used by various applications.

During the three months ended March 31, 2026, we made payments to Oracle totaling $ 2 million.

At March 31, 2026, the amount payable to Oracle was $ 2 million.

In February 2026, we executed a six-year cloud infrastructure services agreement with

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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(Tabular dollars in millions, except per share amounts)

Oracle with a total commitment of $ 300 million, under which payments escalate over the term, in connection with our anticipated enterprise, data, and streaming workloads.

In addition, we have a lease agreement with a term that expires in 2034 under which the lessor is an entity owned and controlled by Lawrence J.

At March 31, 2026 and December 31, 2025, the total liability associated with these leases was $ 169 million and $ 174 million, respectively.

During the three months ended March 31, 2026, we recorded lease costs associated with these leases totaling $ 4 million.

The Ellison Family has investments in other entities over which they have control or can exert significant influence, which as a result, are related parties to us.

We did not have any material transactions with these entities.

RedBird (Successor)

In December 2025, RedBird BD LLC, an affiliate of RB Maverick LLC and RB Tentpole, was engaged as a financial advisor to the Company in connection with the evaluation of the WBD Merger.

Pursuant to the agreement, RedBird BD LLC is entitled to receive an aggregate transaction fee of $ 80 million upon closing, comprised of $ 60 million for mergers and acquisitions advisory services and $ 20 million for capital raising advisory services.

If a termination fee is paid to us in connection with the WBD Merger, RedBird BD LLC is entitled to receive 20 % of such fee, subject to the terms and conditions of the agreement.

Discovery Merger

As further described in Note 1, in connection with the WBD Merger, the Ellison Parties and Redbird entered into the Subscription Agreements and the Equity Syndication.

In addition, we are required to reimburse the Ellison Trust and RedBird for reasonable and documented out-of-pocket expenses, each subject to a cap of $ 5 million.

Other Related Parties

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Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

2025 2025 2024

Revenues $ 40 $ 28 $ 40

Operating costs (a)

$ 30 $ 22 $ 37

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024

Three Months Ended March 31, Three Months Ended March 31,

Revenues $ 93 $ 69

Operating costs (a)

$ 30 $ 82 $ 74

(a) Each period includes costs expensed as operating expenses and costs capitalized in programming assets.

Successor Predecessor

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Receivables, net $ 207 $ 213

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Through the normal course of business, we are involved in other transactions with related parties that have not been material in any of the periods presented.

The tables below present our revenues disaggregated into categories based on the nature of such revenues.

See Note 13 for revenues by segment disaggregated into these categories.

Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

2025 2025 2024

Revenues by Type:

Advertising $ 1,280 $ 664 $ 2,174

Affiliate and subscription 2,027 1,400 3,215

Theatrical 39 73 108

Licensing and other 775 444 1,234

Total Revenues $ 4,121 $ 2,581 $ 6,731

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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(Tabular dollars in millions, except per share amounts)

The tables below present our revenues disaggregated into categories based on the nature of such revenues.

See Note 13 for revenues by segment disaggregated into these categories.

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024

Three Months Ended March 31, Three Months Ended March 31,

Revenues by Type:

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Reserves for accounts receivable reflect our expected credit losses based on historical experience as well as current and expected economic conditions and industry trends.

At September 30, 2025 (Successor) and December 31, 2024 (Predecessor), our allowance for credit losses was $ 97 million and $ 125 million, respectively.

Included in “Other assets” on the Consolidated Balance Sheets are noncurrent receivables of $ 797 million and $ 1.03 billion at September 30, 2025 (Successor) and December 31, 2024 (Predecessor), respectively.

At March 31, 2026 and December 31, 2025, our allowance for credit losses was $ 9 million and $ 10 million, respectively.

Included in “Other assets” on the Consolidated Balance Sheets are noncurrent receivables of $ 778 million and $ 835 million at March 31, 2026 and December 31, 2025, respectively.

Noncurrent receivables primarily relate to revenues recognized under long-term content licensing arrangements.

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Contract Liabilities

Contract liabilities are included within “Deferred revenues” and “Other liabilities” on the Consolidated Balance Sheets and were $ 1.8 billion and $ 0.9 billion at September 30, 2025 (Successor) and December 31, 2024 (Predecessor), respectively.

For the periods from August 7 - September 30, 2025 (Successor) and January 1 - August 6, 2025, and for the nine months ended September 30, 2024 (Predecessor), we recognized revenues of $ 0.4 billion , $ 0.6 billion, and $ 0.6 billion, respectively, that were included in the opening balance of deferred revenues for the respective period.

Contract liabilities are included within “Deferred revenues” and “Other liabilities” on the Consolidated Balance Sheets and were $ 1.5 billion at both March 31, 2026 and December 31, 2025.

We recognized revenues of $ 0.7 billion and $ 0.4 billion for the three months ended March 31, 2026 (Successor) and 2025 (Predecessor), respectively, that were included in the opening balance of deferred revenues for the respective year.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

Unrecognized Revenues Under Contract

At September 30, 2025 (Successor), unrecognized revenues attributable to unsatisfied performance obligations under our long-term contracts were approximately $ 6 billion, of which $ 1 billion is expected to be recognized during the remainder of 2025, $ 3 billion in 2026, $ 1 billion in 2027, and $ 1 billion thereafter.

At March 31, 2026, unrecognized revenues attributable to unsatisfied performance obligations under our long-term contracts were approximately $ 6 billion, of which $ 3 billion is expected to be recognized during the remainder of 2026, $ 2 billion in 2027, and $ 1 billion in 2028.

These amounts only include contracts subject to a guaranteed fixed amount or the guaranteed minimum under variable contracts, primarily consisting of television and film licensing contracts and affiliate agreements that are subject to a fixed or guaranteed minimum fee.

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Unrecognized revenues under contracts disclosed above do not include (i) contracts with an original expected term of one year or less, mainly consisting of advertising contracts, (ii) contracts for which variable consideration is determined based on the customer’s subsequent sale or usage, mainly consisting of affiliate agreements and (iii) long-term licensing agreements for multiple programs for which variable consideration is determined based on the value of the programs delivered to the customer and our right to invoice corresponds with the value delivered.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

Performance Obligations Satisfied in Previous Periods

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As a result, under such arrangements we often satisfy our performance obligation of delivery of our content in advance of revenue recognition.

We recognized revenue of $ 0.1 billion for the Successor period from August 7 - September 30, 2025, $ 0.1 billion and $ 0.4 billion for the Predecessor periods from July 1 - August 6, 2025, and January 1 - August 6, 2025, respectively, and $ 0.2 billion and $ 0.4 billion for the three and nine months ended September 30, 2024, respectively, principally relating to content licensing arrangements for which the performance obligation was satisfied prior to the periods indicated, including agreements with distributors of transactional video-on-demand and electronic sell-through services, other licensing arrangements, and theatrical distribution of our films.

The amounts for the Predecessor periods in 2024 include advertising revenue from amounts recognized during 2024 for the underreporting of revenue by an international advertising sales agent in previous periods.

We recognized revenue of $ 0.1 billion and $ 0.2 billion for the three months ended March 31, 2026 (Successor) and 2025 (Predecessor), respectively, principally relating to content licensing arrangements for which the performance obligation was satisfied prior to the periods indicated, including agreements with distributors of transactional video-on-demand and electronic sell-through services, other licensing arrangements, and theatrical distribution of our films.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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(Tabular dollars in millions, except per share amounts)

The table below details our debt, which was recorded at its fair value as of the closing date of the Transactions and the NAI Transaction on August 7, 2025 (see Note 2).

Paramount Global is the issuer of all of the senior and junior debt in the table below.

Upon the closing of the Transactions, Paramount Skydance Corporation provided a full and unconditional parent guarantee of Paramount Global’s senior and junior debt.

Successor (a)

September 30, 2025 December 31, 2024

Our debt consists of the following:

March 31, 2026 December 31, 2025

4.0 % Senior Notes due 2026

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6.375 % Junior Subordinated Debentures due 2062

Borrowings under credit facility 2,150 —

Obligations under finance leases 2 3

Total debt (b)

Total debt (a)

15,483 13,658

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Total long-term debt, net of current portion $ 14,821 $ 13,225

(a) In connection with the Pushdown of the Ultimate Parent’s basis, our debt was recorded at fair value, which resulted in a decrease to our total debt balance of $ 898 million, reflecting the reversal of a net unamortized discount of $ 390 million and unamortized deferred financing fees of $ 71 million, and a reduction of $ 1.36 billion to adjust our debt to its fair value.

The adjustments to fair value for each of our senior and junior debt issuances will be amortized over the remaining term of the applicable issuance within interest expense (see Note 2).

(b) At September 30, 2025 (Successor), our senior and junior debt balances were net of unamortized fair value adjustments totaling $ 1.35 billion.

At December 31, 2024 (Predecessor), the senior and junior debt balances included a net unamortized discount of $ 401 million and unamortized deferred financing costs of $ 74 million.

The face value of our total debt at both September 30, 2025 (Successor) and December 31, 2024 (Predecessor) was $ 14.98 billion.

(a) At March 31, 2026 and December 31, 2025, our total senior and junior debt was net of unamortized fair value adjustments of $ 1.30 billion and $ 1.32 billion, respectively, recorded in connection with the pushdown of the Ultimate Parent’s basis (see Note 2).

The face value of our total debt at March 31, 2026 and December 31, 2025 was $ 16.78 billion and $ 14.98 billion , respectively.

In January 2026, we repaid our $ 347 million of 4.0 % senior notes at maturity.

Commercial Paper

At both September 30, 2025 (Successor) and December 31, 2024 (Predecessor), we had no outstanding commercial paper borrowings.

At both March 31, 2026 and December 31, 2025, we had no outstanding commercial paper borrowings.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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Credit Facility

On August 7, 2025, in connection with the closing of the Transactions and pursuant to the August 2024 amendment to the Credit Facility (which is further described below), Paramount Skydance Corporation entered into a joinder agreement pursuant to which it joined Paramount Global’s $ 3.50 billion revolving credit facility, which matures in January 2027 (the “Credit Facility”).

In April 2026, we entered into an amendment to our revolving credit facility (the “Credit Facility”), increasing the commitments from $ 3.50 billion to $ 5.00 billion, which will be reduced to $ 4.94 billion in January 2027 through maturity in January 2028.

The Credit Facility is used for general corporate purposes and to support commercial paper borrowings, if any.

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dollars is Term SOFR, and for loans denominated in euros, sterling and yen is based on EURIBOR, SONIA and TIBOR, respectively.

At September 30, 2025, we had no borrowings outstanding under the Credit Facility and the availability under the Credit Facility was $ 3.50 billion.

In the first quarter of 2026, in connection with the $ 2.8 billion termination fee paid to Netflix (see Note 15), we borrowed $ 2.15 billion under the Credit Facility, which remained outstanding at March 31, 2026, at an interest rate of 5.39 % based on SOFR on the borrowing date plus 1.625 %.

The remaining availability under the Credit Facility at March 31, 2026 was $ 1.35 billion, and at May 1, 2026 was $ 2.85 billion.

Credit facility borrowings outstanding at the closing of the WBD Merger are expected to be repaid with the funding from the private placement described in Note 1.

The Credit Facility has one principal financial covenant which sets a maximum Consolidated Total Leverage Ratio (“Leverage Ratio”) at the end of each quarter.

The maximum Leverage Ratio was 5.00 x for the quarter ended September 30, 2025 and will decrease 0.25 x for each subsequent quarter until the quarter ending March 31, 2026 when it will be 4.5 x, and will remain at this level until maturity.

The Leverage Ratio reflects the ratio of our Consolidated Indebtedness, net of unrestricted cash and cash equivalents at the end of a quarter, to our Consolidated EBITDA (each as defined in the credit agreement) for the trailing twelve-month period.

In May 2025, Paramount Global entered into an amendment to the Credit Facility, which increased the maximum amount of unrestricted cash and cash equivalents that can be netted against Consolidated Indebtedness, in the calculation of the Leverage Ratio, from $ 1.50 billion to $ 3.0 billion, effective immediately, and amended the definition of Consolidated EBITDA to include an additional add-back (which is capped at 15 % of Consolidated EBITDA after giving effect to such add-back) for cash items associated with provisions for restructuring or other business optimization programs, litigation and environmental reserves and losses on the disposition of businesses.

We met the covenant as of September 30, 2025.

The Credit Facility also includes a provision that the occurrence of a change of control will be an event of default that would give the lenders the right to accelerate any outstanding loans and terminate their commitments.

In August 2024, Paramount Global entered into amendments to the Credit Facility and the $ 1.9 billion standby letter of credit facility (see Note 14), which, among other things, revised the change of control provision and related definitions to reflect the ownership structure of the Company after giving effect to the Transactions and the NAI Transaction.

These amendments became operative upon closing of the Transactions (see Note 1).

Upon the closing of the Transactions, Paramount Skydance Corporation entered into guarantee agreements providing for a full and unconditional parent guarantee of Paramount Global’s obligations with respect to any commercial paper borrowings incurred, and in accordance with the August 2024 amendment to the Credit Facility, a full and unconditional parent guarantee of Paramount Global’s obligations under the Credit Agreement went into effect.

The maximum Leverage Ratio was 4.50 x for the quarter ended March 31, 2026 and will remain at this level until maturity.

The Leverage Ratio reflects the ratio of our Consolidated Indebtedness, net of a maximum of $ 3.0 billion of unrestricted cash and cash equivalents at the end of a quarter, to our Consolidated EBITDA (each as defined in the credit agreement) for the trailing twelve-month period.

We met the covenant as of March 31, 2026.

Other Bank Borrowings

At both September 30, 2025 (Successor) and December 31, 2024 (Predecessor), there were no outstanding bank borrowings under Miramax’s $ 50 million credit facility that matures in November 2027.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

At both March 31, 2026 and December 31, 2025, there were no outstanding bank borrowings under Miramax’s $ 50 million credit facility that matures in November 2027.

8) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

The carrying value of our financial instruments approximates fair value, except for notes and debentures.

At September 30, 2025 (Successor) and December 31, 2024 (Predecessor), the carrying value of our outstanding notes and debentures was $ 13.63 billion and $ 14.50 billion, respectively, and the fair value, which is determined based on quoted prices in active markets (Level 1 in the fair value hierarchy), was $ 13.9 billion and $ 13.3 billion, respectively.

Our investments without a readily determinable fair value for which we have no significant influence had a carrying value of $ 95 million and $ 86 million at September 30, 2025 (Successor) and December 31, 2024 (Predecessor), respectively.

At March 31, 2026 and December 31, 2025, the carrying value of our outstanding notes and debentures was $ 13.33 billion and $ 13.65 billion, respectively, and the fair value, which is determined based on quoted prices in active markets (Level 1 in the fair value hierarchy), was $ 11.4 billion and $ 13.2 billion, respectively.

Our investments without a readily determinable fair value for which we have no significant influence had a carrying value of $ 55 million and $ 58 million at March 31, 2026 and December 31, 2025, respectively.

These investments are included in “Other assets” on the Consolidated Balance Sheets.

Foreign Exchange Contracts

We use derivative financial instruments primarily to manage our exposure to movements in foreign currency exchange rates when translating from the foreign local currency to the U.S.

We do not use derivative instruments unless there is an underlying exposure and, therefore, we do not hold or enter into derivative financial instruments for speculative trading purposes.

Foreign currency forward contracts have principally been used to manage our exposure for currencies such as the British pound, the euro, the Canadian dollar and the Australian dollar, generally for periods up to 24 months.

We designate forward contracts used to hedge committed and forecasted foreign currency transactions, including future production costs and programming obligations, as cash flow hedges.

Foreign currency forward contracts have principally been used to manage our exposure to currencies such as the British pound, the euro, the Canadian dollar and the Australian dollar.

We designate forward contracts used to hedge committed and forecasted foreign currency transactions, including for the production and licensing of content, as cash flow hedges.

We also enter into non-designated forward contracts to hedge non-U.S.

dollar denominated assets, liabilities, and cash flows.

At September 30, 2025 (Successor) and December 31, 2024 (Predecessor), the notional amount of all foreign exchange contracts was $ 2.92 billion and $ 2.75 billion, respectively.

At September 30, 2025 (Successor), $ 2.50 billion related to future production costs and $ 419 million related to our foreign currency assets and liabilities.

At December 31, 2024 (Predecessor), $ 2.39 billion related to future production costs and $ 358 million related to our foreign currency assets and liabilities.

Gains (losses) recognized on derivative financial instruments were as follows:

Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

2025 2025 2024 Financial Statement Account

Non-designated foreign exchange contracts $ ( 3 ) $ 5 $ ( 17 ) Other items, net

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024 Financial Statement Account

Non-designated foreign exchange contracts $ ( 3 ) $ ( 24 ) $ ( 7 ) Other items, net

The maximum period we are hedging our exposure to variability in future cash flows is 4.9 years.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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(Tabular dollars in millions, except per share amounts)

At March 31, 2026 and December 31, 2025, the notional amount of all foreign exchange contracts was $ 6.76 billion and $ 3.14 billion, respectively.

At March 31, 2026, $ 6.32 billion related to future production and licensing of content and $ 435 million related to our foreign currency assets and liabilities.

At December 31, 2025, $ 2.74 billion related to future production costs and $ 407 million related to our foreign currency assets and liabilities.

The table below presents gains (losses) recognized on derivative financial instruments.

Successor Predecessor

Three Months Ended March 31, Three Months Ended March 31,

2026 2025 Financial Statement Account

Non-designated foreign exchange contracts $ 5 $ ( 9 ) Other items, net

Designated cash flow hedges $ ( 48 ) $ 8 Other comprehensive income (loss)

I n April 2026, we entered into interest rate agreements with an aggregate notional amount of $ 8.0 billion in connection with anticipated debt issuances associated with the WBD Merger and future debt refinancing.

These instruments are intended to hedge exposure to changes in benchmark U.S.

Treasury rates from the execution date of the agreements through the issuance of the related debt.

Fair Value Measurements

The table below presents our assets and liabilities measured at fair value on a recurring basis at September 30, 2025 (Successor) and December 31, 2024 (Predecessor).

The table below presents our assets and liabilities measured at fair value on a recurring basis at March 31, 2026 and December 31, 2025.

These assets and liabilities have been categorized according to the three-level fair value hierarchy established by the FASB, which prioritizes the inputs used in measuring fair value.

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The fair value of deferred compensation liabilities is determined based on the fair value of the investments elected by employees.

Successor Predecessor

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Foreign currency hedges $ 36 $ 38

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Total Liabilities $ 342 $ 340

The estimated fair values of our assets that were impaired during the periods presented were determined using Level 3 inputs.

See Notes 3 and 4.

Level 3 inputs were used in determining Paramount Global’s net assets at the Ultimate Parent’s basis (see Note 2).

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

9) VARIABLE INTEREST ENTITIES

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In determining whether we are the primary beneficiary of a VIE, we assess whether we have the power to direct matters that most significantly impact the activities of the VIE, and have the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

The following tables present the amounts recorded in our consolidated financial statements related to our consolidated VIEs.

Successor Predecessor

September 30, 2025 December 31, 2024

During the first quarter of 2026, we acquired our minority partner’s interest in one of our consolidated VIEs, which increased our ownership interest to 100 %.

Accordingly, for periods subsequent to the acquisition, this entity is not included in the amounts disclosed.

March 31, 2026 December 31, 2025

Total assets $ 853 $ 1,193

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Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

2025 2025 2024

Revenues $ 75 $ 52 $ 131

Operating loss $ ( 3 ) $ ( 15 ) $ ( 11 )

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024

Three Months Ended March 31, Three Months Ended March 31,

Revenues $ 94 $ 125

Operating loss $ ( 3 ) $ ( 102 ) $ ( 75 )

Operating income (loss) $ 24 $ ( 47 )

10) STOCKHOLDERS’ EQUITY

Impact from the Transactions — Common Stock

Impact from the Skydance Transactions — Common Stock

On August 6, 2025, each share of Paramount Global common stock that was owned by Paramount Global as treasury stock was cancelled and ceased to exist, and each issued and outstanding share of Paramount Global Class A Common Stock and Paramount Global Class B Common Stock was converted automatically into the right to receive one share of Paramount Skydance Corporation Class A Common Stock and Paramount Skydance Corporation Class B Common Stock, respectively.

Additionally, at the closing of the Transactions, all outstanding Paramount Global RSU awards and PSU awards were converted to Paramount RSU awards.

The Transactions included a cash-stock election offered to holders of Paramount Global pursuant to which (a) shares of Paramount Global Class A Common Stock held by stockholders other than NAI or its subsidiaries were converted, at the stockholders’ election, into the right to receive either the Class A Cash Consideration or the Class A Stock Consideration and (b) shares of Paramount Global Class B Common Stock held by stockholders other than NAI or its subsidiaries, the NAI Equity Investors and certain other affiliates of investors in Skydance were converted, at the stockholders’ election, into the right to receive the Class B Cash Consideration (subject to proration) or the Class B Stock Consideration.

Additionally, at the closing of the Skydance Transactions, all outstanding Paramount Global RSU awards and PSU awards were converted to Paramount RSU awards.

The Skydance Transactions included a cash-stock election offered to holders of Paramount Global pursuant to which (a) shares of Paramount Global Class A Common Stock held by stockholders other than NAI or its subsidiaries were converted, at the stockholders’ election, into the right to receive either the Class A Cash Consideration or the Class A Stock Consideration and (b) shares of Paramount Global Class B Common Stock held by stockholders other than NAI or its subsidiaries, the NAI Equity Investors and certain other affiliates of investors in Skydance were converted, at the stockholders’ election, into the right to receive the Class B Cash Consideration (subject to proration) or the Class B Stock Consideration.

The elections resulted in cash settlement of 7.2 million shares of Paramount Global Class A Common Stock at a price of $ 23.00 per share and cash settlement of 285.9 million shares of Paramount Global Class B Common Stock at a price of $ 15.00 per share for which holders of the shares elected to receive the Class A Cash Consideration and Class B Cash Consideration, respectively.

In addition, holders of 2.0 million shares of Paramount Global Class A Common Stock elected to receive the Class A Stock Consideration or made no election, and as such received shares of Paramount Skydance Corporation Class B

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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(Tabular dollars in millions, except per share amounts)

Common Stock at a conversion rate of 1.5333 , resulting in the issuance of 3.1 million shares of Paramount Skydance Corporation Class B Common Stock.

addition, holders of 2.0 million shares of Paramount Global Class A Common Stock elected to receive the Class A Stock Consideration or made no election, and as such received shares of Paramount Skydance Corporation Class B Common Stock at a conversion rate of 1.5333 , resulting in the issuance of 3.1 million shares of Paramount Skydance Corporation Class B Common Stock.

Elections made for the Class B Cash Consideration were subject to a proration mechanism.

Shares of Paramount Global Class B Common Stock for which elections to receive Class B Cash Consideration were not made or were validly revoked remained issued and outstanding as one share of Paramount Skydance Corporation Class B Common Stock.

Shares of Paramount Global Class A Common Stock and Paramount Global Class B Common Stock were cancelled and ceased to exist upon completion of the Transactions.

Shares of Paramount Global Class A Common Stock and Paramount Global Class B Common Stock were cancelled and ceased to exist upon completion of the Skydance Transactions.

The cash elections were funded by $ 4.45 billion of the PIPE Transaction proceeds, and the remaining $ 1.52 billion was provided to Paramount.

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In addition, 316.7 million shares ( 313.8 million shares after reduction in connection with certain tax withholding requirements) of Paramount Skydance Corporation Class B Common Stock were issued to holders of Skydance Membership Units and Skydance Phantom Unit awards.

The table below details the activity described above and calculates shares of Paramount Skydance Corporation Class A Common Stock and Class B Common Stock issued and outstanding after completion of the Transactions.

(in millions) Class A Class B

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Total shares of Paramount Skydance Corporation Class A and Class B

Common Stock issued and outstanding after the Transactions 31.5 1,064.6

Under the amended and restated certificate of incorporation, Paramount Skydance Corporation is authorized to issue up to 55 million shares of Paramount Skydance Corporation Class A Common Stock, par value of $ .001 per share;

5.50 billion shares of Paramount Skydance Corporation Class B Common Stock, par value of $ .001 per share;

and 100 million shares of preferred stock, par value of $ .001 per share.

Common Stock issued and outstanding after the Skydance

Transactions on August 7, 2025 31.5 1,064.6

Paramount Skydance Corporation is authorized to issue up to 55 million shares of Paramount Skydance Corporation Class A Common Stock, par value of $ .001 per share;

100 million shares of preferred stock, par value

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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(Tabular dollars in millions, except per share amounts)

of $ .001 per share;

and, effective April 2026, 7.0 billion shares of Paramount Skydance Corporation Class B Common Stock, par value of $ .001 per share, which increased from 5.50 billion shares.

The Certificate of Amendment to the amended and restated certificate of incorporation that increased this authorization also permits the Paramount Skydance Corporation Board of Directors to declare and pay a dividend to holders of Paramount Skydance Corporation Class B Common Stock without being required to declare and pay a corresponding dividend to the holders of Paramount Skydance Corporation Class A Common Stock, subject to the prior written consent or approval of the holders of all of the outstanding shares of Paramount Skydance Corporation Class A Common Stock.

Common Stock Dividends

The following tables present dividends declared per share and total dividends for Paramount Skydance Corporation Class B Common Stock for the Successor period and Paramount Global’s Class A and Class B Common Stock for the Predecessor periods.

Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

2025 2025 2024

Class A and Class B Common Stock

Dividends declared per common share $ .05 n/a $ .05

Total common stock dividends $ 58 n/a $ 35

n/a - not applicable

The following table presents dividends declared per share and total dividends for Paramount Skydance Corporation Class B Common Stock for the Successor period and Paramount Global’s Class A and Class B Common Stock for the Predecessor period.

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024

Three Months Ended March 31, Three Months Ended March 31,

Class A and Class B Common Stock

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Total common stock dividends $ 60 $ 35

Mandatory Convertible Preferred Stock (Predecessor)

At December 31, 2023, there were 10 million shares of Paramount Global Mandatory Convertible Preferred Stock outstanding.

During the first quarter of 2024, 0.3 million shares of Mandatory Convertible Preferred Stock were voluntarily converted into Paramount Global Class B Common Stock at a conversion rate of 1.0013 shares.

On April 1, 2024, each of the remaining 9.7 million outstanding shares automatically and mandatorily converted into 1.1765 shares of Paramount Global Class B Common Stock, resulting in the issuance of 11.5 million shares.

During the first quarter of 2024, the final dividend on the Mandatory Convertible Preferred Stock was declared, at a rate of $ 1.4375 per share, resulting in total dividends of $ 14 million, which were paid on April 1, 2024.

RSU Grants (Successor)

During the period from August 7 - September 30, 2025, new RSU awards totaling 37 million shares were granted to certain senior executives.

Shares with a grant date fair value of $ 447 million will vest in equal quarterly installments over a five-year period and shares with a grant date fair value of $ 26 million will vest in equal quarterly installments over a three-year period.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

Accumulated Other Comprehensive Income (Loss)

The following tables summarize the changes in the components of accumulated other comprehensive income (loss).

(Successor) Cumulative

Adjustments Net Actuarial

Loss and Prior

Service Cost Accumulated

Gain and Prior

Service Cost Cash Flow Hedges Accumulated

Comprehensive Income (Loss)

At December 31, 2024 (Predecessor) $ ( 657 ) $ ( 947 ) $ ( 1,604 )

Other comprehensive income before

reclassifications 115 — 115

Reclassifications to net earnings — 25 (a)

Other comprehensive income 115 25 140

At August 6, 2025 (Predecessor) $ ( 542 ) $ ( 922 ) $ ( 1,464 )

Adjustments to Paramount Global’s basis 542 922 1,464

At August 7, 2025 (Successor) $ — $ — $ —

Other comprehensive income before

At December 31, 2025 $ 40 $ 19 $ — $ 59

Other comprehensive loss before

reclassifications ( 50 ) — ( 36 ) ( 86 )

Other comprehensive income 25 — 25

At September 30, 2025 (Successor) $ 25 $ — $ 25

At March 31, 2026 $ ( 10 ) $ 19 $ ( 36 ) $ ( 27 )

(Predecessor) Cumulative

Adjustments Net Actuarial

Loss and Prior

Service Cost Accumulated

Service Cost Cash Flow Hedges Accumulated

Comprehensive Loss

At December 31, 2023 (Predecessor) $ ( 504 ) $ ( 1,052 ) $ ( 1,556 )

Other comprehensive loss before

At December 31, 2024 $ ( 670 ) $ ( 947 ) $ 13 $ ( 1,604 )

Other comprehensive income before

reclassifications 67 — 6 73

Reclassifications to net loss — 33 (a)

Other comprehensive income (loss) ( 1 ) 33 32

At September 30, 2024 (Predecessor) $ ( 505 ) $ ( 1,019 ) $ ( 1,524 )

Reclassifications to net earnings — 10 (a)

Other comprehensive income 67 10 6 83

At March 31, 2025 $ ( 603 ) $ ( 937 ) $ 19 $ ( 1,521 )

( a) Reflects amortization of net actuarial losses (see Note 12).

The net actuarial loss and prior service cost related to pension and other postretirement benefit plans included in other comprehensive income (loss) is net of a tax benefit of $ 8 million for the period from January 1 - August 6, 2025 (Predecessor) and $ 11 million for the nine months ended September 30, 2024 (Predecessor).

11) INCOME TAXES

The provision for/benefit from income taxes represents federal, state and local, and foreign taxes on earnings (loss) from continuing operations before income taxes and equity in loss of investee companies.

For the period from August 7 - September 30, 2025 (Successor),we recorded a provision for income taxes of $ 85 million and for the periods from July 1 - August 6, 2025 and January 1 - August 6, 2025 (Predecessor), we recorded a benefit from income taxes of $ 229 million and $ 79 million, respectively.

The provision for income taxes in the Successor period reflects the timing of foreign inclusions and foreign-derived intangible income deductions between the Successor and Predecessor periods.

The benefit from income taxes for the Predecessor periods reflect the tax impact of earnings attributable to noncontrolling interests, the timing of foreign inclusions between the Successor and Predecessor periods, and the tax benefit on the foreign-derived intangible income deduction.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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(Tabular dollars in millions, except per share amounts)

Each period was also impacted by the following items identified as affecting the comparability of results.

The cash flow hedges included in other comprehensive income (loss) are net of a tax benefit of $ 12 million and tax expense of $ 2 million for the three months ended March 31, 2026 (Successor) and March 31, 2025 (Predecessor), respectively.

The net actuarial loss and prior service cost related to pension and other postretirement benefit plans included in other comprehensive income (loss) is net of a tax benefit of $ 3 million for the three months ended March 31, 2025 (Predecessor).

11) INCOME TAXES

The income tax provision represents federal, state and local, and foreign taxes on earnings before income taxes and equity in loss of investee companies.

For the three months ended March 31, 2026 (Successor), we recorded a provision for income taxes of $ 155 million, reflecting an effective income tax rate of 39.5 %.

Included in the provision for income taxes are the following items identified as affecting the comparability of our results, which in aggregate increased our effective income tax rate by 6.2 percentage points.

Impact from Items Affecting Comparability

Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6,

Earnings (Loss) Before Income Taxes Benefit from (Provision for) Income Taxes Earnings (Loss) Before Income Taxes Benefit from (Provision for) Income Taxes

Restructuring charges (Note 4)

$ ( 185 ) $ 30 $ ( 13 ) $ 3

Three Months Ended March 31, 2026

Earnings Before Income Taxes Benefit from Income Taxes

Transaction-related items (Note 4)

$ ( 103 ) $ 6

Net discrete tax benefit (a)

n/a $ 4 n/a $ 73

Net discrete tax benefit

n/a - not applicable

For the three months ended March 31, 2025 (Predecessor), we recorded a provision for income taxes of $ 100 million, reflecting an effective income tax rate of 29.9 %.

Impact from Items Affecting Comparability

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6,

Earnings (Loss) Before Income Taxes Benefit from (Provision for) Income Taxes Earnings (Loss) Before Income Taxes Benefit from (Provision for) Income Taxes

Three Months Ended March 31, 2025

Earnings (Loss) Before Income Taxes Benefit from (Provision for) Income Taxes

Restructuring charges (Note 4 )

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Transaction-related items (Note 4) $ ( 20 ) $ —

$ — $ — $ ( 199 ) $ 31

Impairment charges $ — $ — $ ( 157 ) $ 39

Gain from dispositions $ 35 $ ( 2 )

Net discrete tax benefit (a)

n/a $ 4 n/a $ 64

n/a - not applicable

(a) The net discrete tax benefit for the 2025 Predecessor periods reflects the reversal of the valuation allowance on our interest limitation carryforward deferred tax asset of $ 114 million, partially offset by a reserve for uncertain tax positions.

On July 4, 2025, the U.S.

government enacted tax legislation, which includes the extension of certain expired or expiring tax provisions, including a favorable change to the interest deduction limitation, and modifications to certain international tax provisions.

The legislation has multiple effective dates with certain provisions effective in 2025.

As described in the table above, the favorable change to the interest deduction limitation resulted in the reversal of the valuation allowance on our interest limitation carryforward deferred tax asset of $ 114 million.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

For the three and nine months ended September 30, 2024 (Predecessor), we recorded a provision for income taxes of $ 45 million and a benefit from income taxes of $ 342 million, reflecting an effective income tax rate of 37.5 % and 5.6 %, respectively.

Included in the provision for/benefit from income taxes are the following items identified as affecting the comparability of our results, which in aggregate increased our effective income tax rate by 12.0 percentage points and decreased our effective income tax rate by 16.2 percentage points for their respective periods.

Impact from Items Affecting Comparability

Three Months Ended September 30, 2024 Nine Months Ended September 30, 2024

Earnings (Loss) Before Income Taxes Benefit from (Provision for) Income Taxes Earnings (Loss) Before Income Taxes Benefit from (Provision for) Income Taxes

Programming charges (Note 3)

$ — $ — $ ( 1,118 ) $ 275

Impairment charges (Note 4) $ ( 104 ) $ 26 $ ( 6,100 ) $ 375

Restructuring charges (Note 4 )

$ ( 288 ) $ 65 $ ( 544 ) $ 117

Transaction-related

items (Note 4) $ ( 33 ) $ 1 $ ( 51 ) $ 4

Loss from investment $ — $ — $ ( 4 ) $ 1

Net discrete tax benefit

n/a $ 2 n/a $ ( 47 )

Net discrete tax provision n/a $ ( 7 )

n/a - not applicable

(a) The net discrete tax provision for the nine months ended September 30, 2024 is primarily attributable to the establishment of a valuation allowance on our interest limitation carryforward deferred tax asset that was not expected to be realized because of a reduction in our deferred tax liabilities caused by the goodwill impairment charge in the second quarter of 2024.

This impact was partially offset by amounts realized in connection with the filing of our tax returns in certain international jurisdictions.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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12) PENSION AND OTHER POSTRETIREMENT BENEFITS

The following tables present the components of net periodic cost for our pension and postretirement benefit plans.

The service cost component of net periodic cost is presented on the Consolidated Statements of Operations within operating income and all other components of net periodic cost are included within “Other items, net”.

Pension Benefits Postretirement Benefits

Successor Predecessor Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30, Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

2025 2025 2024 2025 2025 2024

Components of net periodic

Service cost $ — $ — $ — $ — $ 1 $ —

Interest cost 30 21 50 1 — 3

Expected return on plan

assets ( 19 ) ( 13 ) ( 34 ) — — —

Amortization of actuarial

loss (gain) (b)

— 7 20 — ( 2 ) ( 4 )

Net periodic cost $ 11 $ 15 $ 36 $ 1 $ ( 1 ) $ ( 1 )

The following table presents the components of net periodic cost for our pension and postretirement benefit plans, which are included within “Other items, net” on the Consolidated Statements of Operations.

Pension Benefits Postretirement Benefits

Successor Predecessor Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30, Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

Three Months Ended March 31, Three Months Ended March 31, Three Months Ended March 31, Three Months Ended March 31,

2026 2025 2026 2025

Components of net periodic

Service cost $ — $ — $ — $ — $ 1 $ —

Components of net periodic cost (a) :

Interest cost $ 50 $ 50 $ 2 $ 2

Expected return on plan

assets ( 19 ) ( 77 ) ( 102 ) — — —

Expected return on plan assets ( 35 ) ( 32 ) — —

Amortization of actuarial

loss (gain) (b)

— 44 60 — ( 11 ) ( 13 )

Net periodic cost $ 15 $ 36 $ 2 $ ( 2 )

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(b) Reflects amounts reclassified from accumulated other comprehensive loss to net earnings (loss).

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

13) SEGMENT INFORMATION

The tables below set forth our financial information by reportable segment that is regularly reviewed by the Company’s chief operating decision maker (“CODM”), who is the Company’s Chief Strategy Officer and Chief Operating Officer, Andrew Gordon.

We are in the process of transitioning our reporting structure into three new segments:

Studios, Direct-to-Consumer, and TV Media, which will be completed and reflected in our Quarterly Report on Form 10-Q for the first quarter of 2026.

The following is a description of our current segments:

• TV Media— Our TV Media segment consists of our (1) broadcast operations — the CBS Television Network, our domestic broadcast television network;

CBS Stations, our owned television stations;

and our international free-to-air networks, Network 10, Channel 5, and Chilevisión;

(2) domestic premium and basic cable networks, including Paramount+ with Showtime, MTV, Comedy Central, Paramount Network, The Smithsonian Channel, Nickelodeon, BET Media Group, CBS Sports Network, and international extensions of certain of these brands;

and (3) domestic and international television studio operations, including CBS Studios and Paramount Television Studios, as well as CBS Media Ventures, which produces and distributes first-run syndicated programming.

TV Media also includes a number of digital properties such as CBS News Streaming for 24 hour news and CBS Sports HQ for sports news and analysis.

• Direct-to-Consumer— Our Direct-to-Consumer segment includes our portfolio of domestic and international pay and free streaming services, including Paramount+, Pluto TV, and BET+.

• Filmed Entertainment — Our Filmed Entertainment segment consists of Paramount Pictures, Skydance’s Animation, Film, Television, Interactive/Games, and Sports divisions, Paramount Players, Paramount Animation, Nickelodeon Studio, Awesomeness, and Miramax .

Beginning in 2026, we transitioned our reporting structure into three new segments:

Studios , Direct-to-Consumer , and TV Media .

Under the new segment structure, our Studios segment reflects the combination of the historical Filmed Entertainment segment with the historical TV Media studio operations, consolidating our content creation activities.

Additionally, our premium cable channel, Paramount+ with Showtime, which was previously under the TV Media segment, is now managed under the Direct-to-Consumer segment.

Concurrent with the change to our segments, we updated our segment expense allocations to better reflect how we operate and make cost decisions across the business.

Certain centralized costs that were previously allocated at the segment level are now reported within corporate expenses.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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(Tabular dollars in millions, except per share amounts)

We present operating income excluding depreciation and amortization, stock-based compensation, impairment charges, restructuring charges, transaction-related items, programming charges, and gain on dispositions, each where applicable (“Adjusted OIBDA”), as the primary measure of profit and loss for our operating segments in accordance with FASB guidance for segment reporting.

Programming charges consist only of charges related to major strategic changes (see Note 3), and do not include impairment charges that occur as part of our normal operations, which are recorded within content costs in the tables below, where applicable, and are not excluded in Adjusted OIBDA.

Stock-based compensation is excluded from our segment measure of profit and loss because it is set and approved by our Board of Directors in consultation with corporate executive management.

As a result of the new accounting basis established in connection with the Skydance Transactions and NAI Transaction, which makes our results of operations not comparable between the Successor and Predecessor periods (see Note 1), we are required to present segment information for the first quarter of 2025 based on our previous segments, Filmed Entertainment , Direct-to-Consumer, and TV Media .

• Studios— Our Studios segment consists of our television and film studio operations, including CBS Studios, Paramount Television Studios, Nickelodeon Animation, Paramount Pictures, Paramount Animation, and Miramax, as well as Skydance Animation, Film, Television, and Interactive/Games, and Paramount Sports Entertainment.

For the Predecessor period, our Filmed Entertainment segment was most comparable to our new Studios segment and excluded studio operations related to our TV Media businesses, including CBS Studios and Paramount Television Studios.

• Direct-to-Consumer— Our Direct-to-Consumer segment consists of our portfolio of domestic and international pay and free streaming services, including Paramount+, Pluto TV, and BET+, as well as our domestic premium cable network, Paramount+ with Showtime.

For the Predecessor period, the Direct-to Consumer segment excluded Paramount+ with Showtime.

• TV Media— Our TV Media segment consists of our (1) broadcast operations—the CBS Television Network, our domestic broadcast television network;

CBS Stations, our owned television stations;

and our international free-to-air networks, including Network 10 and Channel 5;

(2) domestic basic cable networks, including MTV, Comedy Central, Paramount Network, The Smithsonian Channel, Nickelodeon, BET Media Group, CBS Sports Network, and international extensions of certain of these brands;

and (3) CBS Media Ventures, which produces and distributes first-run syndicated programming.

TV Media also includes a number of digital properties such as CBS News 24/7 for 24-hour news and CBS Sports HQ for sports news and analysis.

For the Predecessor period, the TV Media segment also included domestic and international television studio operations and the premium cable network, Paramount+ with Showtime.

In the first quarter of 2026, we also renamed our primary measure of profit and loss for our operating segments from Adjusted OIBDA to Adjusted EBITDA.

Although these measures have different starting points, as we define them, they produce the same result.

We define Adjusted EBITDA as net earnings (loss) before interest expense and income;

provision for (benefit from) income taxes;

equity in earnings (loss) of investee companies, net of tax;

and depreciation and amortization, adjusted to exclude stock-based compensation expense and certain items identified as affecting comparability that are not part of our normal operations.

We define Adjusted OIBDA as operating income before depreciation and amortization, adjusted to exclude stock-based compensation expense and the same items identified as affecting comparability.

This change was made to align with the measure our management, including the CODM, began using in 2026, including for planning and forecasting of future periods, evaluating the operating performance of our segments, and making decisions about resource allocation.

The items identified as affecting comparability that are excluded in both measures include programming charges, impairment charges, restructuring charges, and gain (loss) on dispositions, each where applicable.

Stock-based compensation is a noncash expense that management does not consider to be part of our underlying operating performance and is also excluded in both measures.

We do not disclose our assets by segment because they are not regularly provided to the CODM and are not used to evaluate our operating performance or in determining the allocation of resources.

Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

2025 2025 2024

Advertising $ 980 $ 485 $ 1,666

Affiliate and subscription 1,044 696 1,872

Licensing and other 344 247 760

TV Media 2,368 1,428 4,298

Advertising 300 179 507

Subscription 983 704 1,343

Licensing 1 — 10

Direct-to-Consumer 1,284 883 1,860

Theatrical 39 73 108

Licensing and other 440 202 480

Advertising 1 1 2

Filmed Entertainment 480 276 590

Eliminations ( 11 ) ( 6 ) ( 17 )

Total Revenues $ 4,121 $ 2,581 $ 6,731

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024

Advertising $ 980 $ 4,180 $ 5,981

Affiliate and subscription 1,044 4,302 5,778

Licensing and other 344 1,495 2,041

TV Media 2,368 9,977 13,800

Advertising 300 1,146 1,540

Subscription 983 3,940 4,069

Licensing 1 1 10

Direct-to-Consumer 1,284 5,087 5,619

Theatrical 39 475 399

Licensing and other 440 1,112 1,465

Advertising 1 6 10

Filmed Entertainment 480 1,593 1,874

Eliminations ( 11 ) ( 35 ) ( 64 )

Total Revenues $ 4,121 $ 16,622 $ 21,229

Revenues generated between segments are principally from intersegment arrangements for the distribution of content, rental of studio space, and advertising, as well as licensing revenues earned from third parties who license our content to our internal platforms either through a sub-license or co-production arrangement.

These transactions are recorded at market value as if the sales were to third parties and are eliminated in consolidation.

For content that is licensed between segments, content costs are allocated across segments based on the relative value of the distribution windows within each segment.

Three Months Ended March 31, Three Months Ended March 31,

Studios Filmed Entertainment

Theatrical $ 152 Theatrical $ 148

Licensing and other 1,127 Licensing and other 476

Advertising 4 Advertising 3

Studios 1,283 Filmed Entertainment 627

Direct-to-Consumer Direct-to-Consumer

Advertising 517 Advertising 473

Affiliate and subscription 1,881 Subscription 1,571

Direct-to-Consumer 2,398 Direct-to-Consumer 2,044

TV Media TV Media

Advertising 1,921 Advertising 2,038

Affiliate and subscription 1,620 Affiliate and subscription 1,826

Licensing and other 125 Licensing and other 674

TV Media 3,666 TV Media 4,538

Eliminations — Eliminations ( 17 )

Total Revenues $ 7,347 Total Revenues $ 7,192

For content licensed between segments, costs are allocated across segments based on the relative value of the distribution windows within each segment;

accordingly, no intersegment licensing revenues or profits are recorded by the licensor segment.

Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

2025 2025 2024

Intercompany Revenues:

TV Media $ 3 $ 3 $ 5

Filmed Entertainment 8 3 12

Total Intercompany Revenues $ 11 $ 6 $ 17

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024

Under our previous segment presentation, revenues generated between segments were principally from intersegment arrangements for the distribution of content, rental of studio space, and advertising, as well as licensing revenues earned from third parties who license our content to our internal platforms either through a sub-license or co-production arrangement.

These transactions were recorded at market value as if the sales were to third parties and eliminated in consolidation.

Under our new segment presentation, intersegment revenues are comprised of advertising revenues and licensing revenues earned from third parties who license our content to our internal platforms through sub‑licensing or co‑production arrangements.

Three Months Ended March 31,

Intercompany Revenues:

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Successor Predecessor

Period From August 7 - September 30, Period From July 1 - August 6, Three Months Ended September 30,

2025 2025 2024

Revenues $ 2,368 $ 1,428 $ 4,298

Content costs 1,109 657 2,066

Advertising and marketing 62 59 164

657 430 1,132

Total segment expenses 1,828 1,146 3,362

TV Media Adjusted OIBDA 540 282 936

Direct-to-Consumer

Revenues 1,284 883 1,860

Content costs 545 412 961

Advertising and marketing 153 114 259

Total segment expenses 1,049 778 1,811

Direct-to-Consumer Adjusted OIBDA 235 105 49

Filmed Entertainment

Revenues 480 276 590

Content costs 337 131 274

Advertising and marketing 54 106 145

Total segment expenses 493 312 587

Filmed Entertainment Adjusted OIBDA ( 13 ) ( 36 ) 3

Corporate/Eliminations ( 78 ) ( 38 ) ( 84 )

Stock-based compensation (d)

( 29 ) ( 16 ) ( 46 )

Depreciation and amortization ( 226 ) ( 29 ) ( 96 )

Impairment charges — — ( 104 )

Restructuring and transaction-related items (d)

( 185 ) ( 188 ) ( 321 )

Operating income 244 80 337

Interest expense ( 138 ) ( 85 ) ( 209 )

Interest income 24 13 31

Other items, net ( 8 ) ( 16 ) ( 39 )

Earnings (loss) from continuing operations before

income taxes and equity in loss of investee

companies 122 ( 8 ) 120

(Provision for) benefit from income taxes ( 85 ) 229 ( 45 )

Equity in loss of investee companies, net of tax ( 33 ) ( 31 ) ( 59 )

Net earnings from continuing operations 4 190 16

Net earnings from discontinued operations, net of tax — — 5

(Parent and noncontrolling interests) 4 190 21

Net earnings attributable to noncontrolling interests ( 17 ) ( 434 ) ( 20 )

Net earnings (loss) attributable to Parent $ ( 13 ) $ ( 244 ) $ 1

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Tabular dollars in millions, except per share amounts)

Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024

Revenues $ 2,368 $ 9,977 $ 13,800

Content costs 1,109 4,956 6,528

Advertising and marketing 62 328 444

657 2,626 3,429

Total segment expenses 1,828 7,910 10,401

TV Media Adjusted OIBDA 540 2,067 3,399

Direct-to-Consumer

Revenues 1,284 5,087 5,619

Content costs 545 2,712 3,176

Advertising and marketing 153 749 871

351 1,473 1,783

Total segment expenses 1,049 4,934 5,830

Direct-to-Consumer Adjusted OIBDA 235 153 ( 211 )

Filmed Entertainment

Revenues 480 1,593 1,874

Content costs 337 846 905

Advertising and marketing 54 417 470

Total segment expenses 493 1,693 1,928

Filmed Entertainment Adjusted OIBDA ( 13 ) ( 100 ) ( 54 )

Corporate/Eliminations ( 78 ) ( 212 ) ( 281 )

Stock-based compensation (d)

( 29 ) ( 99 ) ( 141 )

Depreciation and amortization ( 226 ) ( 204 ) ( 297 )

Programming charges — — ( 1,118 )

Impairment charges — ( 157 ) ( 6,100 )

Restructuring and transaction-related items (d)

( 185 ) ( 454 ) ( 595 )

Gain on dispositions — 35 —

Operating income (loss) 244 1,029 ( 5,398 )

Interest expense ( 138 ) ( 516 ) ( 645 )

Interest income 24 83 111

Loss from investment — — ( 4 )

Other items, net ( 8 ) ( 92 ) ( 126 )

Earnings (loss) from continuing operations before

income taxes and equity in loss of investee

companies 122 504 ( 6,062 )

(Provision for) benefit from income taxes ( 85 ) 79 342

Equity in loss of investee companies, net of tax ( 33 ) ( 171 ) ( 221 )

Net earnings (loss) from continuing operations 4 412 ( 5,941 )

Net earnings from discontinued operations, net of tax — — 14

Net earnings (loss)

Three Months Ended March 31, Three Months Ended March 31,

Studios Filmed Entertainment

Revenues $ 1,283 Revenues $ 627

Content costs 816 Content costs 321

Advertising and marketing 100 Advertising and marketing 116

203 Other (a)

Total segment expenses 1,119 Total segment expenses 607

Studios Adjusted EBITDA 164 Filmed Entertainment Adjusted OIBDA 20

Direct-to-Consumer Direct-to-Consumer

Revenues 2,398 Revenues 2,044

Content costs 1,246 Content costs 1,215

Advertising and marketing 315 Advertising and marketing 341

586 Other (b)

Total segment expenses 2,147 Total segment expenses 2,153

Direct-to-Consumer Adjusted EBITDA 251 Direct-to-Consumer Adjusted OIBDA ( 109 )

TV Media TV Media

Revenues 3,666 Revenues 4,538

Content costs 1,719 Content costs 2,343

Advertising and marketing 80 Advertising and marketing 153

812 Other (c)

Total segment expenses 2,611 Total segment expenses 3,616

TV Media Adjusted EBITDA 1,055 TV Media Adjusted OIBDA 922

Corporate/Eliminations ( 309 ) Corporate/Eliminations ( 101 )

Stock-based compensation ( 80 ) Stock-based compensation ( 44 )

Depreciation and amortization ( 362 ) Depreciation and amortization ( 88 )

Transaction-related items ( 103 ) Restructuring and transaction-related items ( 85 )

Gain on dispositions — Gain on dispositions 35

Operating income 616 Operating income 550

Interest expense ( 238 ) Interest expense ( 217 )

Interest income 38 Interest income 38

Other items, net ( 24 ) Other items, net ( 37 )

Earnings before income taxes and equity in

loss of investee companies 392 Earnings before income taxes and equity in

loss of investee companies 334

Provision for income taxes ( 155 ) Provision for income taxes ( 100 )

Equity in loss of investee companies,

net of tax ( 62 ) Equity in loss of investee companies,

net of tax ( 73 )

(Parent and noncontrolling interests) 175 Net earnings

(Parent and noncontrolling interests) 161

Net earnings attributable to noncontrolling interests ( 17 ) ( 447 ) ( 39 )

Net loss attributable to Parent $ ( 13 ) $ ( 35 ) $ ( 5,966 )

Net earnings attributable to noncontrolling

interests ( 7 ) Net earnings attributable to noncontrolling

interests ( 9 )

Net earnings attributable to Parent $ 168 Net earnings attributable to Parent $ 152

(a) Other segment expenses for our Studios segment (Successor) and Filmed Entertainment segment (Predecessor) include employee compensation;

costs relating to the distribution of our content;

costs for occupancy, technology, and professional services;

and other costs associated with our operations.

PARAMOUNT SKYDANCE CORPORATION AND SUBSIDIARIES

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(Tabular dollars in millions, except per share amounts)

(a) Other segment expenses for our TV Media segment include employee compensation;

revenue-sharing costs to television stations affiliated with the CBS Television Network;

costs relating to the distribution of our content;

costs for research, occupancy, technology, and professional services;

and other costs associated with our operations.

(b) Other segment expenses for our Direct-to-Consumer segment include employee compensation;

(b) Other segment expenses for our Direct-to-Consumer segment in both the Successor and Predecessor periods include employee compensation;

revenue-sharing costs, including for third-party distribution;

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and other costs associated with our operations.

(c) Other segment expenses for our TV Media segment in both the Successor and Predecessor periods include employee compensation;

revenue-sharing costs to television stations affiliated with the CBS Television Network;

costs relating to the distribution of our content;

costs for occupancy, technology, and professional services;

costs for research, occupancy, technology, and professional services;

and other costs associated with our operations.

(d) For the Successor period from August 7 - September 30, 2025, and the Predecessor periods from July 1 - August 6, 2025 and January 1 - August 6, 2025, stock-based compensation expense of $ 30 million, $ 10 million, and $ 14 million, respectively, is included in “Restructuring and transaction-related items.” For the Predecessor periods in 2024, stock-based compensation expense of $ 20 million and $ 34 million, respectively, is included in “Restructuring and transaction-related items.”

14) COMMITMENTS AND CONTINGENCIES

Letters of Credit and Surety Bonds

At September 30, 2025 (Successor), we had outstanding letters of credit and surety bonds of $ 673 million that were not recorded on the Consolidated Balance Sheet, including $ 436 million issued under a $ 1.9 billion standby letter of credit facility in accordance with the contractual requirements of one of our commitments.

The amount outstanding under the letter of credit decreases throughout 2025 as we make payments under the related contractual commitment.

At March 31, 2026, we had outstanding letters of credit and surety bonds of $ 2.06 billion that were not recorded on the Consolidated Balance Sheet, including $ 1.82 billion issued under a $ 1.9 billion standby letter of credit facility.

In accordance with the contractual requirements of one of our commitments, the letter of credit outstanding under this facility increases and decreases consistent with the related contractual commitment.

Letters of credit and surety bonds are primarily used as security against non-performance in the normal course of business under contractual requirements of certain of our commitments.

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However, based on our understanding and evaluation of the relevant facts and circumstances, we believe that the following matters are not likely, in the aggregate, to result in a material adverse effect on our business, financial condition and results of operations.

Litigation Relating to the WBD Merger

In April 2026, Donna Nicosia, a purported holder of WBD common stock, filed an action in the Supreme Court of the State of New York, County of Richmond, against WBD, certain directors and officers of WBD, Paramount and other defendants (the “Nicosia Action”).

The complaint arises out of the proposed WBD Merger and alleges, among other things, that the defendants disseminated a proxy statement in connection with the proposed WBD Merger that allegedly contains materially false and misleading statements and omissions concerning the transaction process, the valuation of WBD, and alleged conflicts of interest of WBD’s directors and financial advisors.

The complaint asserts claims under New York common law for negligent misrepresentation, concealment, and negligence and seeks declaratory and injunctive relief, including an order enjoining the closing of the stockholder vote on the proposed transaction unless and until supplemental disclosures are made.

On April 16, 2026, the parties

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Litigation Relating to the Transactions

In connection with the Transactions, on July 24, 2024, Scott Baker, a purported holder of Paramount Global Class B Common Stock, filed a putative class action lawsuit in the Court of Chancery of the State of Delaware (the “Court”) against NAI, Shari E.

entered into an agreement that resolved plaintiffs’ claims as to all defendants, and pursuant to which plaintiff agreed to discontinue the litigation with prejudice.

Also in April 2026, Pamela Faust, together with four other consumers of streaming, cable television, news media, and theatrical entertainment programming, filed a private antitrust action in the U.S.

District Court for the Northern District of California against Paramount and Skydance relating to the WBD Merger.

The complaint seeks to block the WBD Merger, among other relief.

In addition, we received a demand letter from a purported holder of our Class B Common Stock requesting the inspection of books and records to investigate possible breaches of fiduciary duties or other misconduct in connection with the financing of the WBD Merger.

Following the issuance of the Second Request by the Antitrust Division of the U.S.

Department of Justice (“DOJ”) in December 2025, the Company received subpoenas (or Civil Investigative Demands (“CIDs”)) from various state attorneys general in connection with the WBD Merger.

These subpoenas (or CIDs) relate to state investigations of the WBD Merger, with a particular focus on the DOJ’s investigation and the competitive effects of the WBD Merger.

We have been cooperating with the state attorneys general in responding to their requests.

Litigation Relating to the Skydance Transactions

In connection with the Skydance Transactions, in July 2024, Scott Baker, a purported holder of Paramount Global Class B Common Stock, filed a putative class action lawsuit in the Court of Chancery of the State of Delaware against NAI, Shari E.

Redstone, Barbara M.

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Phillips, Jr., Susan Schuman, Skydance and David Ellison (the “Baker Action”).

The complaint alleges breaches of fiduciary duties to Class B stockholders in connection with the negotiation and approval of the Transaction Agreement, among other claims, and seeks unspecified damages, costs and expenses, as well as other relief.

On November 4, 2024, the Court granted the parties’ stipulation in the Baker Action agreeing to (i) postpone briefing on motions to dismiss until the filing or designation of an operative complaint following resolution of the plaintiff’s motion to appoint him and the Baerlocher Family Trust, a purported holder of Paramount Global Class B Common Stock, as co-lead plaintiffs and Berger Montague PC as interim class counsel (the “Baker Leadership Motion”), and (ii) stay discovery until resolution of any motions to dismiss any operative complaint following resolution of the Baker Leadership Motion.

Throughout October 2024, various purported stockholders filed motions for intervention to oppose the Baker Leadership Motion.

On December 31, 2024, the plaintiff, along with Mark Baerlocher, as trustee for the Baerlocher Family Trust, filed an amended complaint alleging the same breaches of fiduciary duties against the same defendants as in the original complaint.

On June 27, 2025, counsel for Mr.

The complaint alleges breaches of fiduciary duties to Paramount Global Class B stockholders in connection with the negotiation and approval of the Transaction Agreement, among other claims, and seeks unspecified damages, costs and expenses, as well as other relief.

In November 2024, the Court granted the parties’ stipulation in the Baker Action to (i) postpone briefing on the motions to dismiss until the filing or designation of an operative complaint following resolution of the plaintiff’s motion to appoint him and the Baerlocher Family Trust, a purported holder of Paramount Global Class B Common Stock, as co-lead plaintiffs and Berger Montague PC as interim class counsel (the “Baker Leadership Motion”), and (ii) stay discovery until resolution of any motion to dismiss an operative complaint following resolution of the Baker Leadership Motion.

In October 2024, various purported stockholders filed motions to intervene to oppose the Baker Leadership Motion.

In December 2024, the plaintiff, along with Mark Baerlocher, as trustee for the Baerlocher Family Trust, filed an amended complaint alleging the same breaches of fiduciary duties against the same defendants as in the original complaint.

In June 2025, counsel for Mr.

Baker informed the Court that the Baker Leadership Motion would be withdrawn without prejudice and that the group of purported stockholders seeking lead plaintiff status would meet and confer to propose a schedule for resolving lead plaintiff applications.

On April 30, 2024, the State of Rhode Island Office of the General Treasurer, on behalf of the Employees’ Retirement System of Rhode Island, a purported holder of Paramount Global Class B Common Stock filed a verified complaint for the inspection of books and records under Section 220 of the General Corporation Law of the State of Delaware (the “DGCL”) in the Court against us, seeking the inspection of our books and records in order to investigate whether our Board of Directors, NAI, Shari E.

Redstone and/or our executive officers may have breached their fiduciary duties to our stockholders for alleged diversion of corporate opportunities (the “220 Action”).

The magistrate judge held a trial on July 24, 2024, and denied the request for inspection.

The plaintiff noticed an exception to the Court, and on January 29, 2025, the Court ruled that the plaintiff is entitled to obtain books and records that are both necessary and sufficient to fulfill the purpose of its request.

On February 25, 2025, the Court granted an implementing order returning the 220 Action to the magistrate judge for further proceedings on the scope of production.

On March 24, 2025, the Court granted our application for certification of interlocutory appeal to the Delaware Supreme Court, which was accepted on April 30, 2025.

Briefing on the appeal is complete.

Certain other purported holders of Paramount Global Class B Common Stock and Class A Common Stock have delivered demand letters to investigate similar alleged breaches of fiduciary duties in connection with the Transactions and requested the inspection of books and records.

We have also received demand letters from purported holders of Paramount Global Class B Common Stock related to alleged omissions in New Paramount’s registration statement on Form S-4.

Additionally, on August 20, 2024, LiveVideo.AI Corp.

In April 2024, the State of Rhode Island Office of the General Treasurer, on behalf of the Employees’ Retirement System of Rhode Island, a purported holder of Paramount Global Class B Common Stock, filed a verified complaint for the inspection of books and records under Section 220 of the General Corporation Law of the State of Delaware (the “DGCL”) in the Court of Chancery of the State of Delaware against us, seeking the inspection of books and records to investigate whether Paramount Global’s Board of Directors, NAI, Shari E.

Redstone and/or certain executive officers may have breached their fiduciary duties to stockholders for alleged diversion of corporate opportunities (the “220 Action”).

The magistrate judge held a trial in July 2024 and denied the request for inspection.

The plaintiff filed an exception to the Court, and in January 2025, the Court ruled that the plaintiff was entitled to obtain books and records that were both necessary and sufficient to fulfill the purpose of its request.

In February 2025, the Court granted an implementing order returning the 220 Action to the magistrate judge for

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further proceedings on the scope of production.

In March 2025, the Court granted our application for certification of interlocutory appeal to the Delaware Supreme Court, which was accepted in April 2025.

In March 2026, the Delaware Supreme Court affirmed the trial court’s decision and remanded the case for further proceedings.

Certain other purported holders of Paramount Global Class B Common Stock and Class A Common Stock have delivered demand letters requesting the inspection of books and records to investigate similar alleged breaches of fiduciary duties in connection with the Skydance Transactions.

We have also received demand letters from purported holders of Paramount Global Class B Common Stock related to alleged omissions in our registration statement on Form S-4.

Additionally, in August 2024, LiveVideo.AI Corp.

filed a lawsuit in the U.S.

District Court for the Southern District of New York against Shari E.

Redstone, NAI, Christine Varney and Monica Seligman, alleging that defendants did not fairly consider its offer to purchase Paramount.

Redstone, NAI, Christine Varney and Monica Seligman, alleging that the defendants did not fairly consider its offer to purchase Paramount Global.

The complaint asserts claims for unfair competition, tortious interference, unjust enrichment and aiding and abetting breach of fiduciary duty, among others, and seeks unspecified monetary damages, costs and other relief.

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The parties exchanged several filings related to service and default.

On August 12, 2025, the magistrate judge issued a Report and Recommendation recommending that the case be dismissed and the court impose $ 10,000 in monetary sanctions against LiveVideo.AI Corp.

The district judge adopted the report in full on September 30, 2025, dismissing the case, imposing the sanctions, and enjoining LiveVideo.AI Corp.

from filing any further lawsuits in any federal district court arising out of the Transactions.

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On August 13, 2025, Gabelli Value 25 Fund Inc.

(“Gabelli”) filed a putative class action complaint against Barbara M.

In August 2025, the magistrate judge issued a Report and Recommendation recommending that the case be dismissed and that the Court impose $10,000 in monetary sanctions against LiveVideo.AI Corp.

In September 2025, the district judge adopted the report in full, dismissed the case, imposed the sanctions, and enjoined LiveVideo.AI Corp.

from filing any further lawsuits in any federal district court arising out of the Skydance Transactions.

LiveVideo.AI filed a Notice of Appeal in November 2025, and in April 2026, the appeal was dismissed.

On April 30, 2026, LiveVideo.AI Corp.

moved to reinstate the appeal.

The parties are currently litigating a motion for sanctions against the plaintiff.

In August 2025, Gabelli Value 25 Fund Inc.

(“Gabelli”) filed a putative class action complaint in the Court of Chancery of the State of Delaware against Barbara M.

Byrne, Linda M.

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McHale, Charles E.

Phillips, Jr., Susan Schuman (the “Special Committee Defendants”), Harbor Lights Entertainment, Inc.

(f/k/a National Amusements, Inc.) and Shari Redstone (the “NAI Defendants”), and Skydance Media, LLC and RB Tentpole LP (the “Skydance Defendants”), alleging causes of action for breach of fiduciary duty against all defendants and unjust enrichment against the NAI Defendants.

Phillips, Jr., Susan Schuman, Harbor Lights (f/k/a National Amusements, Inc.) and Shari E.

Redstone (the “NAI Defendants”), and Skydance Media, LLC and RB Tentpole LP (the “Skydance Defendants”), alleging breach of fiduciary duty against all defendants and unjust enrichment against the NAI Defendants.

Gabelli seeks a declaratory judgment, damages, including rescissory damages and/or quasi-appraisal damages, disgorgement of NAI’s profits, fees and costs, and pre- and post-judgment interest.

On September 16, 2025, the Skydance Defendants filed placeholder motions to dismiss, and Gabelli filed a motion to be appointed as interim lead plaintiff representing former minority holders of Class A shares of pre-Transaction Paramount (the “Gabelli Class A Leadership Motion”).

On October 16, 2025, counsel for Gabelli filed a letter with the Court indicating that no competing motions or objections to the Gabelli Class A Leadership Motion were filed and proposed that the Court appoint Gabelli as lead plaintiff.

On February 4, 2025, New York City Employees’ Retirement System, the New York City Fire Department Pension Fund, the New York City Police Pension Fund, the New York City Board of Education Retirement System, and the Teachers’ Retirement System of the City of New York, purported holders of Paramount Global Class B Common Stock and Class A Common Stock, filed a putative class action lawsuit in the Court against Barbara M.

In September 2025, the Skydance Defendants filed placeholder motions to dismiss, and Gabelli filed a motion to be appointed as interim lead plaintiff representing former minority holders of Paramount Global Class A Common Stock (the “Gabelli Class A Leadership Motion”).

In October 2025, counsel for Gabelli filed a letter with the Court indicating that no competing motions or objections to the Gabelli Class A Leadership Motion were filed and proposed that the Court appoint Gabelli as lead plaintiff.

In November 2025, the Court granted the Gabelli Class A Leadership Motion and appointed Gabelli as lead plaintiff to prosecute the claims on behalf of the Class A minority shareholders.

Defendants moved to stay discovery pending resolution of any filed and forthcoming motions to dismiss, and in February 2026, the Court granted Defendants’ motion to stay discovery.

In February 2025, New York City Employees’ Retirement System, the New York City Fire Department Pension Fund, the New York City Police Pension Fund, the New York City Board of Education Retirement System, and the Teachers’ Retirement System of the City of New York, purported holders of Paramount Global Class B Common Stock and Class A Common Stock, filed a putative class action lawsuit in the Court of Chancery of the State of Delaware against Barbara M.

Byrne, Linda M.

Griego, Judith A.

McHale and Susan Schuman, which alleges breaches of fiduciary duties for their alleged failure to sufficiently consider an alternate offer that the plaintiffs claimed was superior to the Transactions (the “NYCERS Action”).

McHale and Susan Schuman, alleging breaches of fiduciary duties for their alleged failure to sufficiently consider an alternative offer that the plaintiffs claimed was superior to the Skydance Transactions (the “NYCERS Action”).

The plaintiffs argue that the no-shop provision in the Transaction Agreement should be declared invalid and unenforceable because it prevented the parties from engaging in further deal discussions and negotiations with companies other than Skydance, including, specifically, Project Rise Partners, after the no-shop period began.

The plaintiffs further assert that the Court has the power to invalidate this provision because Skydance allegedly aided and abetted NAI’s and Shari E.

The plaintiffs further assert that the Court has the power to

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invalidate this provision because Skydance allegedly aided and abetted NAI’s and Shari E.

Redstone’s breach of fiduciary duties, including by agreeing to indemnify Shari E.

Redstone (through Skydance’s separate agreement with NAI) for any breach of fiduciary duty claims arising out of the Transactions up to a certain amount.

Redstone (through Skydance’s separate agreement with NAI) for any breach of fiduciary duty claims arising out of the Skydance Transactions up to a certain amount.

Skydance, NAI, Shari E.

Redstone and Paramount were not named as defendants in the original complaint.

The NYCERS Action originally sought, among other forms of relief, an order from the Court enjoining the closing of the Transactions until the Court reached a final resolution on the plaintiffs’ claims and an order compelling the Special Committee to evaluate Project Rise Partners’ alternative offer to, among other things, acquire Paramount Global Class A Common Stock for $ 23.00 per share and Paramount Global Class B Common Stock for $ 19.00 per share.

Redstone and Paramount Global were not named as defendants in the original complaint.

The NYCERS Action originally sought, among other forms of relief, an order from the Court enjoining the closing of the Skydance Transactions until the Court reached a final resolution on the plaintiffs’ claims and an order compelling the special committee of Paramount Global’s Board of Directors to evaluate Project Rise Partners’ alternative offer to, among other things, acquire Paramount Global Class A Common Stock for $ 23.00 per share and Paramount Global Class B Common Stock for $ 19.00 per share.

The Project Rise Partners’ offer was made after the go-shop period in the Transaction Agreement had ended.

The complaint does not seek compensatory damages.

The plaintiffs filed a motion for expedited proceedings along with their complaint.

On February 18, 2025, the plaintiffs moved to join Paramount and Skydance (and various other entities named in the Transaction Agreement) as necessary parties to the litigation and moved for a temporary restraining order preventing the closing of the Transactions until the Court considered the plaintiffs’ anticipated motion for injunctive relief following expedited discovery.

The parties reached agreement to withdraw plaintiffs’ request for expedition and their application for injunctive relief in exchange for targeted discovery from certain of the defendants and third parties.

In February 2025, the plaintiffs moved to join Paramount Global, Skydance, Shari E.

Redstone, NAI and various other entities named in the Transaction Agreement as necessary parties to the litigation and moved for a temporary restraining order preventing the closing of the Skydance Transactions until the Court considered the plaintiffs’ anticipated motion for injunctive relief following expedited discovery.

In March 2025, the court allowed plaintiffs to amend the complaint to add Paramount Global, Skydance, Shari E.

Redstone, NAI and the various other entities as defendants.

The amended complaint seeks compensatory damages.

The parties reached an agreement to withdraw the plaintiffs’ request for expedition and their application for injunctive relief in exchange for targeted discovery from certain of the defendants and third parties.

The matter is in discovery.

On April 8, 2025, Metropolitan Water Reclamation District Retirement Fund, Laborers’ and Retirement Board Employees’ Annuity and Benefit Fund of Chicago, Gary Mendelsohn, and Park Employees’ Annuity and Benefit Fund of Chicago, purported holders of Class B Common Stock, filed a complaint for the inspection of books and records under Section 220 of the DGCL in the Court against us to maintain standing to enforce their statutory inspection rights and seek an order that Paramount produce all the books and records identified in their Section 220 demands to investigate possible breaches of fiduciary duties in connection with the Transactions.

In April 2025, Metropolitan Water Reclamation District Retirement Fund, Laborers’ and Retirement Board Employees’ Annuity and Benefit Fund of Chicago, Gary Mendelsohn, and Park Employees’ Annuity and Benefit Fund of Chicago, purported holders of Paramount Global Class B Common Stock, filed a complaint for the inspection of books and records under Section 220 of the DGCL in the Court of Chancery of the State of Delaware against us to maintain standing to enforce their statutory inspection rights and seek an order to produce all the books and records identified in their Section 220 demands to investigate possible breaches of fiduciary duties in connection with the Skydance Transactions.

The complaint alleges that the documents produced to such purported stockholders thus far pursuant to their Section 220 demands are insufficient.

The complaint seeks an order requiring us to produce the documents identified in their Section 220

The complaint seeks an order requiring us to produce the documents identified in their Section 220 demands, among other relief.

In November 2025, the parties contacted the Court with a request to lift the stay and schedule a trial.

A magistrate judge held a trial in March 2026 and took the matter under advisement.

Litigation Relating to Video Streaming Patents

In August 2025, Nokia Technologies Oy filed complaints alleging infringement of patents related to video streaming against Paramount and related entities in the United States, Brazil, Germany and the Unified Patent Court in Europe.

In November 2025, Paramount filed a rate-setting action against Nokia in the High Court of Justice of England and Wales (“U.K.

Court”) seeking a determination of terms for a reasonable and non-discriminatory global license to relevant Nokia patents, including standard essential patents related to the H.265/HEVC standard.

In March 2026, Nokia submitted to the jurisdiction of the U.K.

Court and dismissed its complaints against Paramount in all other jurisdictions.

Claims Related to Former Businesses

We are a defendant in lawsuits claiming various personal injuries related to asbestos and other materials, which allegedly occurred as a result of exposure caused by various products manufactured by Westinghouse, a predecessor, generally prior to the early 1970s.

Westinghouse was neither a producer nor a manufacturer of

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demands, among other relief.

On April 21, 2025, the Court approved a stipulation by the parties to stay all proceedings in the action in an effort to resolve the dispute.

Litigation Related to Distribution Agreements

In October 2024, Sony Pictures Television Inc., along with Jeopardy Productions, Inc.

and Califon Productions, Inc.

(collectively, “Sony”), filed a civil complaint for damages against CBS Studios Inc.

in the Superior Court of the State of California, for Los Angeles County, asserting a breach of contract claim against us relating to our exclusive right to distribute Wheel of Fortune and Jeopardy!

(the “Distribution Agreements”).

In December 2024, we filed a cross-complaint against Sony seeking, among other things, a declaration that the Distribution Agreements remain in full force and effect.

On February 3, 2025, Sony purported to assume our distribution functions, and on February 4, 2025, we filed an ex parte application, seeking a temporary restraining order preventing Sony from assuming these distribution functions, which the trial court granted on February 5, 2025.

On April 10, 2025, the trial court declined to issue a preliminary injunction preventing Sony from assuming these distribution functions for the duration of the litigation.

On April 11, 2025, we appealed the trial court’s ruling and requested a stay of the order denying the preliminary injunction, which was granted on April 16, 2025.

The parties have reached a settlement of this matter.

Claims Related to Former Businesses

Westinghouse was neither a producer nor a manufacturer of asbestos.

We are typically named as one of a large number of defendants in both state and federal cases.

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We do not report as pending those claims on inactive, stayed, deferred or similar dockets that some jurisdictions have established for claimants who allege minimal or no impairment.

As of September 30, 2025 (Successor), we had pending approximately 17,540 asbestos claims, as compared with approximately 18,310 as of December 31, 2024 (Predecessor).

For the period from August 7 - September 30, 2025 (Successor) and for the period from July 1 - August 6, 2025 (Predecessor) we received approximately 450 and 330 new claims, respectively, and closed or moved to an inactive docket approximately 910 and 120 claims, respectively.

As of March 31, 2026, we had pending approximately 18,050 asbestos claims, as compared with approximately 17,490 as of December 31, 2025.

During the first quarter of 2026, we received approximately 830 new claims and closed or moved to an inactive docket approximately 270 claims.

We report claims as closed when we become aware that a dismissal order has been entered by a court or when we have reached agreement with the claimants on the material terms of a settlement.

Settlement costs depend on the seriousness of the injuries that form the basis of the claims, the quality of evidence supporting the claims and other factors.

Our total costs for the years 2024 (Predecessor) and 2023 (Predecessor) for settlement and defense of asbestos claims after insurance recoveries and net of tax were approximately $ 34 million and $ 54 million, respectively.

Our total costs for settlement and defense of asbestos claims after insurance recoveries and net of tax, were approximately $ 23 million for the Successor period from August 7 - December 31, 2025, $ 11 million and $ 34 million for the Predecessor periods from January 1 - August 6, 2025, and the year ended December 31, 2024, respectively.

Our costs for settlement and defense of asbestos claims may vary year to year and insurance proceeds are not always recovered in the same period as the insured portion of the expenses.

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lung cancer, a cancer which may be caused by various factors, one of which is alleged to be asbestos exposure;

other cancers, and conditions that are substantially less serious, including claims

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brought on behalf of individuals who are asymptomatic as to an allegedly asbestos-related disease.

other cancers, and conditions that are substantially less serious, including claims brought on behalf of individuals who are asymptomatic as to an allegedly asbestos-related disease.

A significant number of pending claims against us are non-cancer claims.

It is difficult to predict long-term future asbestos liabilities, as events and circumstances may impact the estimate.

From time to time, we receive claims from federal and state environmental regulatory agencies and other entities asserting that we are or may be liable for environmental cleanup costs and related damages principally relating to our historical and predecessor operations.

Environmental and Other

From time to time, we also receive claims from federal and state environmental regulatory agencies and other entities asserting that we are or may be liable for environmental cleanup costs and related damages principally relating to our historical and predecessor operations.

In addition, from time to time we receive personal injury claims including toxic tort and product liability claims (other than asbestos) arising from our historical operations and predecessors.

Contingent Liabilities Relating to Former Businesses

In connection with recording Paramount Global’s net assets at the Ultimate Parent’s basis, “Other liabilities” was increased to reflect the fair value of Paramount Global’s estimated contingent liabilities for the defense and settlement of asbestos lawsuits as well as claims from federal and state environmental regulatory agencies and other entities asserting liability for environmental cleanup costs and related damages (See Note 2).

The estimated fair value of the asbestos-related liability was determined in consultation with a third-party firm with expertise in estimating asbestos liability and represents the estimate of the amount a third party would pay to take on the risk of any asbestos-related future losses.

We record an accrual for a loss contingency when it is both probable that a liability has been incurred and when the amount of the loss can be reasonably estimated.

The reasonably estimable period for our long-term asbestos liability is 10 years, which we determine in consultation with a third-party firm with expertise in estimating asbestos liability and is due to the inherent uncertainties in the tort litigation system.

This estimate is based upon

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many factors, including the number of outstanding claims, estimated average cost per claim, the breakdown of claims by disease type, historic claim filings, costs per claim of resolution and the filing of new claims, and is assessed in consultation with the third-party firm.

While we believe that our accruals for these matters are adequate, there can be no assurance that circumstances will not change in future periods and, as a result, our actual liabilities may be higher or lower than our accrual.

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Successor Predecessor

Period From August 7 - September 30, Period From January 1 - August 6, Nine Months Ended September 30,

2025 2025 2024

Three Months Ended March 31, Three Months Ended March 31,

Cash paid for interest $ 260 $ 264

Cash paid for income taxes $ 11 $ 201 $ 68

Cash paid (received) for income taxes $ ( 34 ) $ 27

Noncash additions to operating lease assets $ 28 $ 40

The cash balance on August 6, 2025 (Predecessor) was $ 2.46 billion.

The cash balance on August 7, 2025 (Successor) was $ 3.85 billion.

The difference reflects the proceeds received from the PIPE Transaction (see Note 1) and cash received from Skydance’s opening balance sheet, offset by cash paid for transaction-related costs incurred prior to the Closing Date.

In connection with the closing of the Transactions, on August 7, 2025 (Successor), borrowings outstanding of $ 720 million under Skydance’s revolving credit facility were repaid in full.

Discovery Merger—Advance Consideration

In the first quarter of 2026, under the terms of the WBD Merger Agreement, we paid a termination fee of $ 2.8 billion to Netflix on behalf of WBD in connection with the termination of a prior merger agreement between Netflix and WBD.

The termination fee will be included in the total consideration to be allocated to WBD’s assets and liabilities as of the acquisition date, and accordingly has been included within “Advance consideration for WBD acquisition” on the Consolidated Balance Sheet as of March 31, 2026 and within Investing Activities on the Consolidated Statement of Cash Flows for the three months ended March 31, 2026.

We enter into operating leases for the use of our owned production facilities and office buildings.

Lease payments received under these agreements consist of fixed payments for the rental of space and certain building operating costs, as well as variable payments based on usage of production facilities and services, and escalating costs of building operations.

We recorded total lease income, including both fixed and variable amounts, of $ 7 million, $ 2 million and $ 23 million for the periods from August 7 - September 30, 2025 (Successor), July 1 - August 6, 2025,

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and January 1 - August 6, 2025 (Predecessor), respectively, and $ 10 million and $ 25 million for the three and nine months ended September 30, 2024 (Predecessor), respectively.

During the first quarter of 2025 (Predecessor), we recorded gains totaling $ 35 million, principally associated with the disposition of a noncore business.

Discontinued Operations

On October 30, 2023, we completed the sale of Simon & Schuster to affiliates of Kohlberg Kravis Roberts & Co.

During the first quarter of 2024 (Predecessor), we recorded an additional pretax gain of $ 12 million on the sale as a result of a working capital adjustment.

We recorded total lease income, including both fixed and variable amounts, of $ 8 million and $ 9 million for the three months ended March 31, 2026 (Successor) and March 31, 2025 (Predecessor), respectively.

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