What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-05-07 compared with 2026-01-14 · 285 added, 541 removed, 178 unchanged (82% of the section changed)

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Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

Moreover, neither we, nor any other person, assume responsibility for the accuracy and completeness of the forward-looking statements.

We are under no obligation to update any of the forward-looking statements after the filing of this Quarterly Report to conform such statements to actual results or to changes in our expectations.

Moreover, neither we, nor any other person, assumes responsibility for the accuracy and completeness of the forward-looking statements.

Except as required by law, we are under no obligation to update any of the forward-looking statements after the filing of this Quarterly Report to conform such statements to actual results or to changes in our expectations.

The following discussion of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes and other financial information appearing elsewhere in this Quarterly Report.

Readers are also urged to carefully review and consider the various disclosures made by us which attempt to advise interested parties of the factors which affect our business, including without limitation the disclosures made in Item 1A of Part II of this Quarterly Report under the caption “Risk Factors.”

Risk factors that could cause actual results to differ from those contained in the forward-looking statements include, but are not limited to:

Factors that could cause actual results to differ from those contained in the forward-looking statements include, but are not limited to:

volatility in our revenues and results of operations;

changing conditions in the financial markets;

matters related to our investment in Freedom VCM Holdings, LLC (“Freedom VCM”) and developments related to our prior business relationship with Brian Kahn (the former CEO of Freedom VCM);

developments that may arise related to our prior investment in Freedom VCM Holdings, LLC (“Freedom VCM”) and prior business relationship with Brian Kahn (the former CEO of Freedom VCM);

the receipt by the Company and Bryant Riley of subpoenas from the SEC;

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our ability to generate sufficient revenues to achieve and maintain profitability;

failure to comply with the terms of our credit agreements or senior notes;

the level of our indebtedness;

our ability to meet future capital requirements;

our exposure to credit risk;

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failure to successfully compete in any of our businesses;

our dependence on communications, information and other systems and third parties;

the potential loss of financial institution clients;

the illiquidity of, and additional potential losses from, our proprietary investments;

changing economic and market conditions, including inflation and any actions by the Federal Reserve to address inflation, and the possibility of recession or an economic downturn;

the effects of tariffs and other governmental initiatives, and related impacts including supply chain disruptions, labor shortages and increased labor costs;

potential liability and harm to our reputation if we were to provide an inaccurate appraisal or valuation;

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our ability to borrow under our credit facilities;

failure to comply with the terms of our credit agreements or senior notes;

the level of our indebtedness;

our ability to meet future capital requirements;

our ability to realize the benefits of our completed acquisitions, including our ability to achieve anticipated opportunities and cost savings, and accretion to reported earnings estimated to result from completed and proposed acquisitions in the time frame expected by management or at all;

our dependence on communications, information and other systems and third parties;

the potential loss of financial institution clients;

the diversion of management time on divestiture-related issues;

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the activities of short sellers and their impact on our business and reputation;

changing economic and market conditions, including inflation and any actions by the Federal Reserve to address inflation, and the possibility of recession or an economic downturn;

the effects of tariffs and other governmental initiatives, and related impacts including supply chain disruptions, labor shortages and increased labor costs;

and the effect of geopolitical instability, including wars, conflicts and terrorist attacks, including the impacts of Russia’s invasion of Ukraine and conflicts in the Middle East.

We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Except as otherwise required by the context, references in this Quarterly Report to the “Company,” “BRC,” “BRC Group Holdings,” “we,” “us” or “our” refer to the combined business of BRC Group Holdings (f/k/a B.

Riley Financial, Inc.) and all of its subsidiaries.

Except as otherwise required by the context, references in this Quarterly Report to the “Company,” “BRCGH,” “BRC,” “BRC Group Holdings,” “we,” “us” or “our” refer to the combined business of BRC Group Holdings, Inc.

and all of its subsidiaries.

Description of the Company

BRC Group Holdings, Inc.

Riley Financial Inc.) (NASDAQ:

RILY) (the “Company”) is a diversified holding company, including financial services, telecom, and retail, and investments in equity, debt and venture capital.

RILY) (the “Company” or “BRCGH”), which changed its name from B.

Riley Financial, Inc.

effective January 1, 2026, is a diversified holding company offering a platform of businesses, including financial services (with complementary banking and wealth management businesses), telecom, retail, and investments in equity, debt and venture capital.

We refer to BRCGH as having a “platform” because of the unique composition of our financial services businesses and diversification of its operations.

Our core financial services platform provides small cap and middle market companies customized end-to-end solutions at every stage of the enterprise life cycle.

Our banking business offers comprehensive services in capital markets, sales, trading, research, merchant banking, M&A, and restructuring.

Our wealth management business offers wealth management and financial planning services including brokerage, investment management, insurance, and tax preparation.

Our telecom businesses provide consumer and business services including traditional, mobile and cloud phone, internet and data, security, and email.

Our retail companies provide home furnishings and mobile computing accessories.

BRC deploys its

capital inside and outside its core financial services platform to generate shareholder value through opportunistic investments.

The Company also opportunistically invests in and acquires companies or assets with attractive risk-adjusted return, with a focus on making operational improvements within these companies in an effort to maximize free cash flow.

We are headquartered in Los Angeles, California and maintain offices throughout the U.S.

including in New York, Chicago, Metro District of Columbia, Boston, Memphis, Miami, San Francisco, Boca Raton, and Palm Beach, as well as additional offices located in Canada, Europe, Asia, and Australia.

Our complementary banking business offers comprehensive services in capital markets, sales, trading, research, merchant banking, M&A, and restructuring.

Our complementary wealth management business offers wealth management and financial planning services including brokerage, investment management, insurance, and tax preparation.

businesses provide consumer and business services including traditional, mobile and cloud phone, internet and data, security, and email.

Our consumer products and retail companies provide mobile computing accessories and home furnishings.

BRCGH, through its investment business, deploys its capital inside and outside its core financial services business to generate shareholder value through opportunistic investments.

The Company opportunistically invests in and acquires companies or assets with attractive risk-adjusted return, with a focus on making operational improvements within these companies in an effort to maximize free cash flow.

We are headquartered in Los Angeles, California and maintain offices throughout the U.S., including in New York, New Jersey, Chicago, Metro District of Columbia, Boston, Dallas, Memphis, Miami, San Francisco, Boca Raton, and Palm Beach Gardens, as well as an office located in India.

Our Business Segments

We maintain a diverse composition of businesses that operate in five reportable segments:

Capital Markets, Wealth Management, Communications, Consumer Products, and E-Commerce segment.

We maintain a diverse composition of businesses that operate in seven reportable business segments:

Capital Markets, Wealth Management, Lingo, magicJack, Marconi Wireless, UOL, and Consumer Products.

The descriptions below illustrate the businesses that comprise our segments.

Management evaluates many different financial and non-financial metrics to assess the individual performance of each of these various business segments.

However, across most businesses, management primarily assesses each business’s financial performance based upon each of the businesses revenues and operating profits generated excluding non-cash charges and the impact of gains and losses related to securities and other investments held.

Management evaluates many different financial and non-financial metrics to assess the individual performance of each of these various businesses.

However, across most businesses, management primarily assesses each business’s financial performance based upon each business’s revenues and operating profits generated excluding non-cash charges and the impact of gains and losses related to securities and other investments held.

Management believes that gains and losses on individual investments are generally impacted by individual characteristics specific to each investment and although this has an impact on our overall financial performance the impact of these gains and losses may not be indicative of the overall strength or weakness in each of our business operations.

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Management recognizes that some of the Company’s businesses exhibit more volatile results.

Capital Markets Segment – We provide investment banking, equity research and institutional brokerage services to publicly traded and privately held companies, institutional investors, and financial sponsors;

fund and asset management services to institutional and high-net-worth individual investors;

Capital Markets – We provide investment banking, equity research and institutional brokerage services to publicly traded and privately held companies, institutional investors, and financial sponsors;

and direct lending services to middle market companies.

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We act as an advisor to our clients, which at times involves complex transactions consistent with our value-oriented investment philosophy.

We often provide consulting, capital raising, or investment banking services for companies in which we may have significant influence through equity ownership, representation on the board of directors (or similar governing body), or both.

Wealth Management Segment – We provide retail brokerage, investment management, and insurance, and tax preparation services to individuals and families, small businesses, non-profits, trusts, foundations, endowments, and qualified retirement plans through a boutique private wealth and investment management firm to meet the individual financial needs and goals of our customers.

We often provide consulting, capital raising, or investment banking services for companies in which BRC may have significant influence through equity ownership, representation on the board of directors (or similar governing body), or both.

Wealth Management – We provide retail brokerage, investment management, and insurance, and tax preparation services to individuals and families, small businesses, non-profits, trusts, foundations, endowments, and qualified retirement plans through a boutique private wealth and investment management firm to meet the individual financial needs and goals of our customers.

Our experienced financial advisors provide investment management, retirement planning, education planning, wealth transfer and trust coordination, and lending and liquidity solutions.

Our investment strategists provide strategies and real-time market views and commentary to help our clients make important and informed financial and investment decisions.

Communications Segment – We own a number of businesses that comprises our Communications Segment that we have acquired for attractive risk-adjusted investment return characteristics.

We may pursue future acquisitions to expand this portfolio of businesses which currently includes:

Lingo Management, LLC (“Lingo”), a global cloud/unified communications and managed service provider that includes the operations of BullsEye Telecom, Inc.

(“BullsEye”), a single source communications and cloud technology provider (previously merged into Lingo);

Marconi Wireless Holdings, LLC (“Marconi Wireless”), a mobile virtual network operator that provides mobile phone voice, text, and data services and devices;

magicJack VoIP Services, LLC (“magicJack”), a VoIP cloud-based technology and communications provider that offers related devices and subscription services;

and United Online, Inc.

(“UOL”), an Internet access provider that offers dial-up, mobile broadband and digital subscriber line services under the NetZero and Juno brands.

Revenues from the Wealth Management segment are comprised of the following:

Three Months Ended

Revenues - Services and fees

Brokerage revenues $ 15,661 $ 18,346

Advisory revenues 10,971 16,434

Other 15,447 11,886

Total services and fees revenue 42,079 46,666

Trading income 10,096 612

Total revenues $ 52,175 $ 47,278

Total assets under management were approximately $11.9 billion and $13.0 billion at March 31, 2026 and December 31, 2025, respectively.

Of these amounts, advisory assets under management totaled approximately $4.0 billion at March 31, 2026, and $4.3 billion at December 31, 2025.

Advisory revenues were 0.28% and 0.25% of average advisory assets under management during the three months ended March 31, 2026 and 2025, respectively.

The average revenues earned on advisory assets under management are not expected to fluctuate significantly from period to period as a percentage of advisory assets under management.

Broker revenues are primarily comprised of commissions and fees earned from trading activities from brokerage client assets.

Other revenues are primarily comprised of tax service fees and management fees earned from comprehensive client focused services performed.

Lingo Segment – Lingo Management, LLC and its subsidiary Bullseye Telecom (together, “Lingo”) is a global cloud/unified communications (“UC”) and managed service provider to Enterprise and Small to Medium Businesses in the United States.

Lingo primarily re-sells Plain Old Telephone Services (“POTS”), Broadband data services and Managed Security services in addition to the Cloud Voice, POTS Alternative and business collaboration communication services.

magicJack Segment – magicJack VoIP Services, LLC and related subsidiaries (together, “magicJack”) is a non-interconnected Voice-over-IP (“VoIP”) cloud-based communications service provider that offers related devices and subscription services within the United States and Canada.

The magicJack services allow its subscribers to stay connected at low costs.

Marconi Wireless Segment – Marconi Wireless Holdings, LLC (“Marconi Wireless”) is a mobile virtual network operator that provides mobile phone voice, text, and data services and devices using the Credo Mobile brand.

UOL Segment – United Online, Inc.

(“UOL”) is an Internet access provider that offers dial-up and digital subscriber line (“DSL”) services under the NetZero and Juno brands across the United States.

UOL also provides paid and free e-mail subscription services that also generate advertising revenues.

Consumer Products Segment – This segment is comprised of Tiger US Holdings, Inc.

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The Targus product line includes laptop and tablet cases, backpacks, universal docking stations, and computer accessories.

E-Commerce Segment – This segment is comprised of Nogin, Inc.

(“Nogin”), which is a technology platform operating e-commerce stores that delivers Commerce-as-a-Service (“CaaS”) solutions for apparel brands and other retailers.

The Company manages clients’ front-to-back-end operations of the e-commerce stores and also provides marketing services to their clients.

The Company’s business model is based on providing a comprehensive e-commerce solution to its customers on a revenue sharing basis.

Our operating results are primarily comprised of the operations of these businesses within our five reportable operating segments.

However, we also generate revenues from other businesses that we may acquire with the goal to expand their operations, drive growth, and create operational efficiencies to improve cash flows to reinvest across other business operations in our platform.

These businesses are typically in fragmented markets and include the operations of a regional environmental services business, and bebe which operates rent-to-own stores.

In prior years, we also generated operating revenues from our majority owned subsidiary that licenses the trademarks and intellectual properties from our ownership of six brands:

Catherine Malandrino, English Laundry, Joan Vass, Kensie Girl, Limited Too and Nanette Lepore, and we generated other income from dividends we receive from our equity ownership of investments that range from 10% to 50% in companies that license the trademark and intellectual property of the Hurley, Justice, and Scotch & Soda brands and bebe and Brookstone brands (equity ownership of bebe stores, inc.

(“bebe”), our majority owned subsidiary).

We also reported fair value adjustments from these equity investments since we elected to account for these equity investments using the fair value method of accounting.

These operating results are included in discontinued operations and are expected to be deconsolidated as a result of the Sale by bebe and completion of the secured financing of the Brand Interests as discussed in Note 4 - Discontinued Operations and Assets Held for Sale to the accompanying unaudited condensed consolidated financial statements.

Securities and Other Investments Owned Portfolio – We have a portfolio of securities and other investments owned that consists of public equity securities, private equity securities, corporate bonds, other fixed income securities, and partnership interests and other investments as follows at September 30, 2025 and December 31, 2024:

September 30,

Our operating results are primarily comprised of the operations of these businesses within our seven reportable operating segments.

However, we also generate revenues from investment and lending entities and other businesses that we may acquire with the goal to expand their operations, drive growth, and create operational efficiencies to improve cash flows to reinvest across other business operations in our platform.

These businesses are typically in fragmented markets and include the operations of a regional environmental services business, which was sold in March 2025 and bebe stores inc.

(“bebe”) which operates rent-to-own stores.

Securities and Other Investments Owned Portfolio – We have a portfolio of securities and other investments owned that consists of public equity securities, private securities, partnership interests and other investments, corporate bonds and other fixed income securities as follows at March 31, 2026 and December 31, 2025:

2026 December 31,

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- common stock $ 403,189 $ 174,011

Babcock & Wilcox Enterprises, Inc.

- preferred stock 1,959 1,528

Double Down Interactive Co., Ltd - common stock 29,300 30,010

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Total securities and other investments owned $ 639,668 $ 446,843

Securities and other investments owned was $315.5 million and $282.3 million as of September 30, 2025 and December 31, 2024, respectively.

Of this amount, the carrying value of equity securities totaled $248.7 million and $232.5 million as of September 30, 2025 and December 31, 2024, respectively.

Of these amounts, public equity securities totaled $149.7 million and $124.9 million as of September 30, 2025 and December 31, 2024, and private equity securities totaled $99.0 million and $107.6 million as of September 30, 2025 and December 31, 2024, respectively.

The carrying value of Babcock & Wilcox Enterprises, Inc.’s (“B&W”) - common stock held as of held as of September 30, 2025 and December 31, 2024 was $79.6 million and $45.0 million, respectively.

The change in the carrying value for the nine months ended September 30, 2025 was due to a increase in the public share price during the period.

The carrying value of our Double Down Interactive Co., Ltd common stock held as of September 30, 2025 and December 31, 2024 was $32.2 million and $43.7 million, respectively.

The change in the carrying value for the nine months ended September 30, 2025 was primarily driven by sales of the securities and, to a lesser extent, a decrease in the public share price during the period.

The carrying value of our investments in other public equities held as of September 30, 2025 and December 31, 2024 was $33.5 million and $27.4 million, respectively.

The change in the carrying value for the nine months ended September 30, 2025 was driven by purchases of certain other public equity securities and, to a lesser extent, increases in the public share prices during the period.

The carrying value of our investments in other private equities held as of September 30, 2025 and December 31, 2024 was $99.0 million and $107.6 million, respectively.

The decrease in the carrying value for the nine months ended September 30, 2025 was driven by sales of certain private securities and, to a lesser extent, decreases in fair values during the period.

Recent Developments

On January 1, 2026, the Company’s previously announced name change became effective.

The name of the Company is now BRC Group Holdings, Inc.

Our trading symbol (“RILY”) and our CUSIP (05580M108) remain the same.

Total securities and other investments owned increased $192.8 million during the three months ended March 31, 2026 primarily due to the following:

• $229.2 million increase in the carrying values of Babcock & Wilcox Enterprises, Inc.’s (“B&W”) common stock due to an increase in the public share price during the period.

• $(0.7) million decrease in the carrying values of our Double Down Interactive Co., Ltd common stock primarily driven by sales of the securities and a decrease in the public share price during the period.

• $(3.5) million decrease due to the disposition of our investment in Synchronoss Technologies, Inc.

in the current year period.

• $(3.0) million decrease in the carrying values of our investments in other public equities driven by net decreases in public share prices, partially offset by net additions during the period.

• $(41.6) million decrease in the carrying values of our investments in other private equities driven primarily by dispositions of certain private securities.

• $13.4 million increase in the carrying values of our investments in partnership interests and other securities primarily driven by net increase in market value of certain securities during the period.

Critical Accounting Estimates

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Critical accounting estimates represent the areas where more significant judgments and estimates are used in the preparation of our unaudited condensed consolidated financial statements.

A discussion of such critical accounting estimates, which include fair value measurements, goodwill and other intangible assets, and accounting for income tax valuation allowances can be found in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

At June 30, 2025, qualitative factors indicated it could be more likely than not that the carrying value of the Targus tradename in the Consumer Products segment could be impaired.

In order to estimate the fair value of the Targus tradename management must make certain estimates and assumptions which, among other things, included an assessment of market conditions, projected cash flows, discount rates, and revenue growth rates.

The inputs for the fair value calculations included a 3.5% growth rate to calculate the terminal value, a discount rate of 22.2%, and a royalty rate of 1.5%.

This resulted in an impairment charge for the Targus tradename in the amount of $1.5 million at June 30, 2025.

Changes in these estimates and assumptions could materially affect the determination of fair value and any impairment charge for the tradename.

Any changes from our current estimates and assumptions that result in materially different estimates and assumptions in the future in response to changing economic conditions, changes in our business or for other reasons could result in the recognition of additional impairment charges in future periods.

There were no impairments of goodwill or indefinite-lived intangibles of other reporting units identified in an interim basis during the nine months ended September 30, 2025.

Results of Operations

The following period to period comparisons of our financial results and our interim results are not necessarily indicative of future results.

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025

Condensed Consolidated Statements of Operations

(Dollars in thousands)

Three Months Ended September 30, Change

Three Months Ended March 31, Change

2026 2025 Amount %

Services and fees $ 152,122 $ 158,839 $ (6,717) (4.2) %

Trading gains (losses), net 53,012 (1,238) 54,250 n/m

Trading gains (losses), net 145,061 (16,171) 161,232 (997.0) %

Fair value adjustments on loans 6,545 (8,096) 14,641 (180.8) %

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Selling, general and administrative expenses 134,348 167,388 (33,040) (19.7) %

Restructuring charge 184 116 68 58.6 % %

Interest expense - Securities lending and loan participations sold 717 719 (2) (0.3) %

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Dividend income 669 135 534 395.6 %

Realized and unrealized gains (losses) on investments 32,756 (22,197) 54,953 n/m

Change in fair value of financial instruments and other (3,314) — (3,314) n/m

Realized and unrealized gains (losses) on investments 105,100 (14,500) 119,600 (824.8) %

Change in fair value of financial instruments and other (4,427) 922 (5,349) (580.2) %

Gain on sale and deconsolidation of businesses — 80,841 (80,841) (100.0) %

Gain on senior note exchange 12,222 — 12,222 n/m

Income from equity investments 9,193 6 9,187 n/m

Loss on extinguishment of debt (950) (5,900) 4,950 (83.9) % %

Gain on senior note exchange — 10,532 (10,532) (100.0) %

Income (loss) from equity investments 1,326 (552) 1,878 (340.2) %

Gain (loss) on extinguishment of debt 2,890 (10,427) 13,317 (127.7) %

Interest expense (19,794) (29,964) 10,170 (33.9) %

Income (loss) from continuing operations before income taxes 239,050 (23,004) 262,054 (1,139.2) %

Provision for income taxes (1,183) (9,950) 8,767 (88.1) % %

(Provision for) benefit from income taxes (16,891) 3,042 (19,933) (655.3) %

Income (loss) from continuing operations 222,159 (19,962) 242,121 (1,212.9) %

Loss from discontinued operations, net of income taxes (1,866) (136,987) 135,121 (98.6) % %

Income from discontinued operations, net of income taxes — 3,395 (3,395) (100.0) %

Net income (loss) 222,159 (16,567) 238,726 (1,441.0) %

Net income (loss) attributable to noncontrolling interests 4,470 (3,201) 7,671 n/m

Net income (loss) attributable to Registrant 91,083 (284,397) 375,480 (132.0) % %

Net income (loss) attributable to noncontrolling interests 8,886 (6,592) 15,478 (234.8) %

Net income (loss) attributable to BRC Group Holdings, Inc.

213,273 (9,975) 223,248 (2,238.1) %

Preferred stock dividends 2,015 2,015 — — %

Net income (loss) available to common shareholders $ 211,258 $ (11,990) $ 223,248 (1,862.0) %

n/m - Not applicable or not meaningful.

The table below, and the discussion that follows, are based on how we analyze our business.

Three Months Ended September 30, Change

Three Months Ended March 31, Change

2026 2025 Amount %

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Wealth Management segment 42,079 46,666 (4,587) (9.8) %

Communications segment 59,363 66,241 (6,878) (10.4) % %

E-Commerce segment — 5,233 (5,233) (100.0) % %

All Other 11,611 23,273 (11,662) (50.1) % %

Subtotal 170,668 174,573 (3,905) (2.2) % %

Trading gains (losses), net:

Capital Markets segment 44,951 (1,908) 46,859 n/m

Wealth Management segment 8,061 670 7,391 n/m

Subtotal 53,012 (1,238) 54,250 n/m

Fair value adjustments on loans:

Capital Markets segment 1,299 (71,477) 72,776 (101.8) % %

Interest income - loans:

Capital Markets segment 2,094 11,251 (9,157) (81.4) % %

Interest income - securities lending:

Capital Markets segment 2,523 7,007 (4,484) (64.0) % %

Sale of goods:

Communications segment 1,003 1,318 (315) (23.9) % %

Consumer Products segment 46,967 49,793 (2,826) (5.7) % %

E-Commerce segment — 3,749 (3,749) (100.0) % %

All Other 305 388 (83) (21.4) % %

Lingo segment 40,790 41,553 (763) (1.8) %

magicJack segment 8,473 9,446 (973) (10.3) %

Marconi Wireless segment 7,026 8,541 (1,515) (17.7) %

UOL segment 2,821 3,633 (812) (22.4) %

Corporate and All Other 15,383 27,408 (12,025) (43.9) %

Subtotal $ 152,122 $ 158,839 $ (6,717) (4.2) %

Total revenues $ 277,871 $ 175,364 $ 102,507 58.5 % %

__________________________________________

n/m - Not applicable or not meaningful.

Total revenues increased $102.5 million to $277.9 million during the three months ended September 30, 2025 from $175.4 million during the three months ended September 30, 2024.

The increase in revenues during the three months ended September 30, 2025 was primarily due to increases in fair value adjustments on loans of $72.8 million, and increases in fair value of the portfolio of securities and other investments owned of $54.3 million, partially offset by decreases in revenues from interest income from loans of $9.2 million, sale of goods of $7.0 million, interest income from securities lending of $4.5 million, and services and fees of $3.9 million.

Of the $72.8 million increase in fair value adjustments related to loans, $54.2 million related to the loan to Vintage Capital Management, LLC (“VCM”) and $18.6 million related to the loan to

The decrease in revenue of $3.9 million from services and fees in the three months ended September 30, 2025 consisted of decreases in revenue of $15.0 million in the Wealth Management segment, $11.7 million in All Other, $6.9 million in the Communications segment, and $5.2 million in the E-Commerce segment, partially offset by an increase of revenue of $34.9 million in the Capital Markets segment.

Revenues from services and fees in the Capital Markets segment increased $34.9 million to $65.4 million during the three months ended September 30, 2025 from $30.4 million during the three months ended September 30, 2024.

The increase in revenues was primarily due to increases of $32.6 million of corporate finance, consulting, and investment banking fees, $2.2 million in asset management fees, $0.7 million in commission fees, and $0.3 million in dividends, partially offset by increases of $0.7 million of interest income, and $0.2 million in other income.

The increase in investment banking revenues is related to the episodic nature of this business, an increase in the number of transactions when compared to the prior period, and the public press release of the B.

Riley Securities Holdings, Inc.

(“BRSH”) carve out.

The increases in investment banking revenues were $13.6 million in investment banking underwriting fees, $11.5 million in private placement fees, and $9.4 million in at the market fees, partially offset by a decrease of $1.7 million in mergers and acquisitions advisory fees.

Revenues from the Wealth Management segment are comprised of the following:

Three Months Ended

September 30,

Revenues - Services and fees

Brokerage revenues $ 18,582 $ 23,120

Advisory revenues 10,800 19,935

Other 4,960 6,334

Total services and fees revenue 34,342 49,389

Trading gains (losses), net:

Total revenues $ 42,403 $ 50,059

Revenues from brokerage and advisory decreased $13.7 million to $29.4 million during the three months ended September 30, 2025 from $43.1 million during the three months ended September 30, 2024.

The decrease in revenues was primarily due to decreases in revenue from wealth and asset management fees due to a reduction in AUM which was driven by a loss of headcount of wealth management advisors and the Stifel transaction in April 2025.

Refer to Note 4 to the accompanying unaudited condensed consolidated financial statements for additional information.

Total assets under management were approximately $13.3 billion and $25.7 billion at September 30, 2025 and September 30, 2024, respectively.

Of these amounts, advisory assets under management totaled approximately $4.2 billion at September 30, 2025 and $8.1 billion at September 30, 2024.

Advisory revenues were 0.25% and 0.24% of average advisory assets under management during the three months ended September 30, 2025 and 2024, respectively.

The average revenues earned on advisory assets under management are not expected to fluctuate significantly from period to period as a percentage of advisory assets under management.

Brokerage revenues are primarily comprised of commissions and fees earned from trading activities from brokerage client assets.

Other revenues is primarily comprised of tax service fees and management fees earned from comprehensive client focused services performed.

Revenues from services and fees in the Communications segment decreased $6.9 million to $59.4 million during the three months ended September 30, 2025 from $66.2 million during the three months ended September 30, 2024.

The decrease in revenues was primarily due to decreases in subscription revenue of $6.7 million, $1.7 million of which related to divestiture of the Lingo wholesale carrier business in third quarter of fiscal year 2024.

Of the remaining $5.1 million decrease in subscription revenue, $1.8 million was from Marconi Wireless, $1.7 million was from Lingo, $1.1 million was from magicJack, and $0.4 million was from UOL.

We expect Lingo, magicJack, Marconi Wireless and UOL subscription revenue to continue to decline year-over-year as landline and VoIP technologies are older and cellular services are offered in a highly competitive marketplace.

There were no revenues from services and fees in the E-Commerce segment during the three months ended September 30, 2025.

This segment consisted of Nogin which we deconsolidated in the first quarter of 2025.

Refer to Note 3 to the accompanying unaudited condensed consolidated financial statements for additional information.

Revenues from services and fees in All Other decreased $11.7 million to $11.6 million during the three months ended September 30, 2025 from $23.3 million during the three months ended September 30, 2024.

These revenues include merchandise rental fees and sales from bebe, and the operations of a regional environmental services business, which was sold in the first quarter of 2025.

Revenues from services and fees in All Other decreased by $11.2 million related to the regional environmental services business, and $0.9 million related to merchandise rental fees from bebe, partially offset by an increase in revenues of $0.4 million in other revenue.

Trading gains (losses), net increased $54.3 million to income of $53.0 million during the three months ended September 30, 2025 compared to loss of $1.2 million during the three months ended September 30, 2024.

The income of $53.0 million during the three months ended September 30, 2025 was primarily due to realized and unrealized income on investments made in our proprietary trading accounts, primarily gains of $30.2 million on Babcock & Wilcox Enterprises, Inc.

(“B&W”) and $28.4 million on Applied Digital Corporation (“Applied Digital”), offset by trading losses.

In our Capital Markets segment we have a portfolio of loans receivable that are measured at fair value with changes in fair value reported in our results of operations.

The loan portfolio and fair value adjustments on loans consisted of the following:

Fair Value Adjustments on Loans

Loans Receivable, at Fair Value Three Months Ended

September 30,

Industry or Type of Loan September 30, 2025 December 31, 2024

Related Party Loans:

Vintage Capital Management, LLC Retail / consumer $ 1,303 $ 2,057 $ (165) $ (54,333)

Freedom VCM Receivables, Inc.

Consumer receivable portfolio — 3,913 — 534

Retail / consumer — 38,826 — (18,600)

Badcock Corporation Consumer receivable portfolio — 2,169 — 852

Great American Holdings, LLC Professional Services 25,000 — — —

Other related party loans Professional Services, Industrials 1,542 4,937 116 2,779

Total related party 27,845 51,902 (49) (68,768)

Exela Technologies, Inc.

Technology 25,173 32,136 1,323 (221)

Norlin EV Limited Real Estate — 6,065 25 12

Other loans Various 2,000 — — (2,500)

Total $ 55,018 $ 90,103 $ 1,299 $ (71,477)

The fair value adjustments on loans receivable for the three months ended September 30, 2025 and 2024, were $1.3 million and $(71.5) million, respectively.

During the three months ended September 30, 2025 and 2024, fair value adjustments for other loans receivable totaled $1.3 million and $(2.7) million, respectively.

The $72.8 million favorable variance in fair value adjustment related to our loans receivable during the three months ended September 30, 2025 was primarily driven by $54.2 million related to the VCM and $18.6 million related to Conn’s.

Interest income from loans decreased $9.2 million to $2.1 million during the three months ended September 30, 2025 from $11.3 million during the three months ended September 30, 2024.

The decrease was primarily due to non-accrual of interest on the following adjusted loans:

$3.4 million for VCM, and $1.5 million for Nogin, as well as a reduction in loan receivable balances from $151.7 million as of September 30, 2024 to $55.0 million as of September 30, 2025.

Interest income from securities lending decreased $4.5 million to $2.5 million during the three months ended September 30, 2025 from $7.0 million during the three months ended September 30, 2024.

The decrease was due to counterparties constraining their business activity and a reduced strategic focus and deployment of capital in securities lending, which led to lower securities lending balances.

Revenues from the sale of goods decreased $7.0 million to $48.3 million during the three months ended September 30, 2025 from $55.2 million during the three months ended September 30, 2024.

The decrease was primarily related to decreases of $3.7 million from Nogin in the E-Commerce segment, which was deconsolidated in the first quarter of 2025,$2.8 million from the Consumer Products segment due to a decrease in computer and peripheral sales worldwide, $0.3 million from the Communications segment, and $0.1 million in All Other consisting of sales of goods from bebe.

Operating Expenses

Direct cost of services

Direct cost of services decreased $18.4 million to $31.3 million during the three months ended September 30, 2025 from $49.7 million during the three months ended September 30, 2024.

The decrease in direct cost of services was primarily attributable to a decrease of $8.3 million from the Communications segment, $2.0 million of which was attributable to divestiture of the Lingo wholesale carrier business in third quarter of fiscal year 2024, $7.1 million from All Other, consisting of $6.7 million from the regional environmental services business that was sold in the first quarter of 2025, and $0.4 million from bebe, and $3.0 million from the E-Commerce segment, consisting of Nogin which was deconsolidated in the first quarter of 2025.

Cost of goods sold

Cost of goods sold for the three months ended September 30, 2025 decreased $5.3 million to $35.0 million from $40.3 million during the three months ended September 30, 2024.

The decrease in cost of goods sold was primarily attributable to decreases of $2.8 million in the Consumer Products segment, due to lower sales volume, $2.1 million from the E-Commerce segment, consisting of Nogin which was deconsolidated in the first quarter of 2025, $0.3 million from the Communications segment due to decreased sales, and $0.1 million from All Other consisting of cost of goods from bebe.

Selling, general and administrative expenses

Selling, general and administrative expenses during the three months ended September 30, 2025 and 2024 were comprised of the following:

Three Months Ended September 30, 2025 Three Months Ended

September 30, 2024 Change

Amount % Amount % Amount %

Capital Markets segment $ 135,303 $ (17,266) $ 152,569 (883.6) %

Wealth Management segment 10,096 612 9,484 1,549.7 %

Communications segment 19,386 13.5 % % 21,533 13.4 % % (2,147) (10.0) % %

Consumer Products segment 14,506 10.1 % % 16,893 10.5 % % (2,387) (14.1) % %

E-Commerce segment — — % % 9,089 5.6 % % (9,089) (100.0) % %

Corporate and All Other (338) 483 (821) (170.0) %

21,360 14.8 % % 33,011 20.5 % % (11,651) (35.3) % %

Total selling, general & administrative expenses $ 143,892 100.0 % % $ 161,075 100.0 % % $ (17,183) (10.7) % %

Total selling, general and administrative expenses decreased by $17.2 million to $143.9 million during the three months ended September 30, 2025 from $161.1 million during the three months ended September 30, 2024.

The decrease was primarily due to decreases of $14.1 million in the Wealth Management segment, $11.7 million in Corporate and All Other, $9.1 million in the E-Commerce segment, $2.4 million in the Consumer Products segment, and $2.1 million in the Communications segment, partially offset by an increase of $22.2 million in the Capital Markets segment.

Capital Markets

Selling, general and administrative expenses in the Capital Markets segment increased by $22.2 million to $53.4 million during the three months ended September 30, 2025 from $31.3 million during the three months ended September 30, 2024.

The increase was primarily due to increases of $21.2 million in employee compensation and benefit related expenses, which primarily related to increases in commissions paid, largely related to increased revenue, and $2.1 million in investment banking deal expenses, partially offset by decreases of $0.6 million in other expenses, and $0.5 million in occupancy-related costs.

Wealth Management

Selling, general and administrative expenses in the Wealth Management segment decreased by $14.1 million to $35.2 million during the three months ended September 30, 2025 from $49.3 million during the three months ended September 30, 2024, primarily due to decreases of $9.6 million in employee compensation and benefit related expenses, which primarily related to decreases in commissions paid, bonuses and other payroll expenses due to a decrease in headcount, which aligns with the decrease in revenue, $3.8 million change in the fair value of contingent consideration, $0.6 million in depreciation and amortization expense, and $0.6 million in other expenses, partially offset by an increase of $0.5 million in occupancy-related costs, due to multiple office closures and lease impairments as a result of the Stifel transaction.

Communications

Selling, general and administrative expenses in the Communications segment decreased $2.1 million to $19.4 million for the three months ended September 30, 2025 from $21.5 million for the three months ended September 30, 2024.

The decrease was primarily due to decreases of $0.9 million in employee compensation and benefit related expenses due to lower headcount, lower commissions and sale of the Lingo carrier business in the third quarter of 2024, $0.6 million in professional services, $0.5 million in occupancy-related costs, and $0.1 million in depreciation and amortization expenses due to items being fully amortized in 2024.

Consumer Products

Selling, general and administrative expenses in the Consumer Products segment decreased $2.4 million to $14.5 million for the three months ended September 30, 2025 from $16.9 million during the three months ended September 30, 2024.

The decrease was primarily due to decreases of $1.6 million in professional services and $0.8 million in employee compensation and benefit related expenses due to reduced headcount.

There were no selling, general and administrative expenses in the E-Commerce segment during the three months ended September 30, 2025.

This segment consisted of Nogin which we deconsolidated in the first quarter of 2025.

Refer to Note 3 to the accompanying unaudited condensed consolidated financial statements for additional information.

Corporate and All Other

Selling, general and administrative expenses for Corporate and All Other decreased $11.7 million to $21.4 million during the three months ended September 30, 2025 from $33.0 million during the three months ended September 30, 2024.

The decrease was primarily due to $5.6 million in employee compensation and benefit related expenses primarily driven by a decrease in corporate compensation, $2.6 million in other expenses, $2.4 million in foreign currency translation, and $1.1 million in depreciation and amortization.

Interest Expense - Securities Lending and Loan Participations Sold.

Interest Expense - Securities Lending and Loan Participations Sold decreased $4.3 million to $2.1 million during the three months ended September 30, 2025 from $6.4 million for the three months ended September 30, 2024.

The decrease was due to a reduced strategic focus and deployment of capital in securities lending, which led to lower securities lending balances.

Other Income (Expense).

Other income included interest income of $1.5 million and $1.4 million during the three months ended September 30, 2025 and 2024, respectively.

Dividend income was $0.6 million during the three months ended September 30, 2025 compared to $0.7 million during the three months ended September 30, 2024.

Realized and unrealized (losses) gains on investments was a gain of $32.8 million during the three months ended September 30, 2025

compared to a loss of $22.2 million during the three months ended September 30, 2024, which is comprised of the following:

Realized and Unrealized Gains (Losses)

Three Months Ended September 30,

Other Income (Expense) - Realized & Unrealized Gains (Losses)

Public Equity Securities:

Babcock & Wilcox Enterprises, Inc.

- common stock $ 23,009 $ 7,005

Babcock & Wilcox Enterprises, Inc.

- preferred stock 840 2,495

Double Down Interactive Co., Ltd - common stock (751) 13,113

Synchronoss Technologies, Inc.

- common stock — 6,445

Applied Digital Corporation - common stock 13,189 —

Other public equities (3,559) 209

Subtotal $ 145,061 $ (16,171) $ 161,232 (997.0) %

Private Equity Securities:

Freedom VCM Holdings, LLC — (49,033)

Kanaci Technologies, LLC — 32,364

BJES Holdings, LLC — (35,891)

Other private equities 328 1,309

Subtotal 328 (51,251)

Corporate bonds (300) (246)

Partnership interest and other — 33

Total $ 32,756 $ (22,197)

The favorable variance of $55.0 million was primarily due to unfavorable fair value adjustments recorded in the prior year quarter of $49.0 million for Freedom VCM and $35.9 million for BJES Holdings, LLC, and a $16.0 million increase in the fair value of our common stock investment in Babcock & Wilcox Enterprises, Inc, partially offset by favorable fair value adjustments recorded in the prior year quarter of $32.4 million for Kanaci Technologies, LLC and $13.1 million for Double Down Interactive Co., Ltd.

Other income (expense) also includes change in fair value of financial instruments and other was a loss of $3.3 million during the three months ended September 30, 2025.

Gain on senior note exchange was $12.2 million during the three months ended September 30, 2025.

Income from equity investments was $9.2 million during the three months ended September 30, 2025.

Loss on extinguishment of debt during the three months ended September 30, 2025 was $1.0 million compared to a loss of $5.9 million during the three months ended September 30, 2024.

Interest expense was $18.8 million during the three months ended September 30, 2025 compared to $33.0 million during the three months ended September 30, 2024.

The decrease in interest expense was due to lower debt balances during the three months ended September 30, 2025.

The decreases in interest expense primarily consisted of $7.4 million from the issuance of senior notes, $5.9 million from the Nomura term loan, $1.4 million from the Lingo term loan, $0.4 million from the Nomura revolving credit facility, $0.4 million from the Targus term loan, $0.4 million from the Nogin secured convertible promissory note, and partially offset by increases in interest expense of $1.3 million from the Oaktree term loan, $0.6 million from the BRPAC term loan, and $0.1 million from the Targus FGI loan.

Provision for Income Taxes.

Provision for income taxes was $1.2 million during the three months ended September 30, 2025 compared to $10.0 million during the three months ended September 30, 2024.

The effective income tax rate was 1.2% for the three months ended September 30, 2025 as compared to 7.1% for the three months ended September 30, 2024.

Loss From Discontinued Operations, Net Of Income Taxes.

On October 25, 2024, we and our subsidiary bebe completed a transaction for our brand assets yielding approximately $236.0 million in cash proceeds.

The results have been presented as discontinued operations for the three months ended September 30, 2024.

Loss from discontinued operations, net of tax, for Brands Transaction, as described in Note 4 to the accompanying unaudited condensed consolidated financial statements, was $(141.3) million during the three months ended September 30, 2024.

On November 15, 2024, we completed the sale of our Appraisal and Valuation Services, Real Estate, and Retail, Wholesale & Industrial Solutions businesses (collectively, the “Great American Group”), and its results have been presented as discontinued operations for the three months ended September 30, 2024.

Loss from discontinued operations, net of income taxes was $(1.9) million during the three months ended September 30, 2024.

On June 27, 2025, we signed an equity purchase agreement to sell all of the membership interests of GlassRatner Advisory & Capital Group, LLC (“GlassRatner”) and B.

Riley Farber Advisory Inc.

(“Farber”), and their results have been presented as discontinued operations for the three months ended September 30, 2024.

Loss from discontinued operations, net of tax for GlassRatner and Farber was $(1.9) million for the three months ended September 30, 2025, compared to income from discontinued operations of $6.2 million during the three months ended September 30, 2024.

Refer to Note 4 to the accompanying unaudited condensed consolidated financial statements for additional information.

Preferred Stock Dividends .

Preferred stock dividends were $2.0 million for the three months ended September 30, 2025 and 2024.

Dividends on the Series A preferred paid during the three months ended September 30, 2024 were $0.4296875 per depository share.

Dividends on the Series B preferred paid during the three months ended September 30, 2024 were $0.4609375 per depository share.

On January 21, 2025, the Company announced that we had temporarily suspended dividends on our Series A and B Preferred Stock.

Unpaid dividends will accrue until paid in full.

Results of Operations

The following period to period comparisons of our financial results and our interim results are not necessarily indicative of future results.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

Condensed Consolidated Statements of Operations

(Dollars in thousands)

Nine Months Ended September 30, Change

2025 2024 Amount %

Services and fees $ 475,279 $ 591,563 $ (116,284) (19.7) % %

Trading gains (losses), net 64,521 (50,226) 114,747 n/m

Fair value adjustments on loans:

Interest income - loans 9,143 51,894 (42,751) (82.4) % %

Interest income - securities lending 5,487 69,614 (64,127) (92.1) % %

Sale of goods 140,803 164,254 (23,451) (14.3) % %

Total revenues 689,236 567,839 121,397 21.4 % %

Operating expenses:

Direct cost of services 107,207 168,008 (60,801) (36.2) % %

Cost of goods sold 106,847 118,897 (12,050) (10.1) % %

Selling, general and administrative expenses 453,649 518,029 (64,380) (12.4) % %

Restructuring charge 505 925 (420) (45.4) % %

Impairment of goodwill and tradenames 1,500 27,681 (26,181) (94.6) % %

Interest expense - Securities lending and loan participations sold 4,781 65,055 (60,274) (92.7) % %

Total operating expenses 674,489 898,595 (224,106) (24.9) % %

Operating income (loss) 14,747 (330,756) 345,503 (104.5) % %

Other income (expense):

Interest income 3,469 2,892 577 20.0 % %

Dividend income 821 4,139 (3,318) (80.2) % %

Realized and unrealized gains (losses) on investments 28,472 (212,362) 240,834 (113.4) % %

Change in fair value of financial instruments and other 9,492 — 9,492 n/m

Gain on sale and deconsolidation of businesses 86,213 790 85,423 n/m

Gain on senior note exchange 67,208 — 67,208 n/m

Income from equity investments 34,244 12 34,232 n/m

Loss on extinguishment of debt (21,643) (5,780) (15,863) n/m

Interest expense (72,685) (102,195) 29,510 (28.9) % %

Income (loss) from continuing operations before income taxes 150,338 (643,260) 793,598 (123.4) % %

Provision for income taxes (1,194) (17,803) 16,609 (93.3) % %

Income (loss) from continuing operations 149,144 (661,063) 810,207 (122.6) % %

Income (loss) from discontinued operations, net of income taxes 70,841 (108,270) 179,111 (165.4) % %

Net income (loss) 219,985 (769,333) 989,318 (128.6) % %

Net loss attributable to noncontrolling interests (594) (2,167) 1,573 (72.6) % %

Net income (loss) attributable to Registrant 220,579 (767,166) 987,745 (128.8) % %

Preferred stock dividends 6,045 6,045 — — % %

Net income (loss) available to common shareholders $ 214,534 $ (773,211) $ 987,745 (127.7) % %

n/m - Not applicable or not meaningful.

The table below and the discussion that follows are based on how we analyze our business.

Nine Months Ended September 30, Change

2025 2024 Amount %

Services and fees:

Capital Markets segment $ — $ (3,131) $ 3,131 (100.0) %

Wealth Management segment 114,429 150,153 (35,724) (23.8) % %

Communications segment 183,268 225,055 (41,787) (18.6) % %

E-Commerce segment 3,469 7,964 (4,495) (56.4) % %

All Other 44,461 67,365 (22,904) (34.0) % %

Corporate and All Other 6,545 (4,965) 11,510 n/m

Subtotal $ 6,545 $ (8,096) $ 14,641 (180.8) %

Trading gains (losses), net:

Capital Markets segment 50,648 (52,787) 103,435 (195.9) % %

Wealth Management segment 13,873 2,561 11,312 n/m

Subtotal 64,521 (50,226) 114,747 n/m

Fair value adjustments on loans:

Capital Markets segment (5,997) (259,260) 253,263 (97.7) % %

Interest income - loans:

Capital Markets segment $ 7 $ 65 $ (58) (89.2) %

Corporate and All Other 1,707 3,131 (1,424) (45.5) %

Subtotal $ 1,714 $ 3,196 $ (1,482) (46.4) %

Interest income - securities lending:

1 unchanged sentence

Sale of goods:

Communications segment 3,775 4,079 (304) (7.5) % %

magicJack segment $ 310 $ 355 $ (45) (12.7) %

Marconi Wireless segment 511 946 (435) (46.0) %

Consumer Products segment 44,115 42,103 2,012 4.8 %

E-Commerce segment 3,528 6,014 (2,486) (41.3) % %

All Other 1,146 1,422 (276) (19.4) % %

Corporate and All Other 431 4,051 (3,620) (89.4) %

Subtotal $ 45,367 $ 47,455 $ (2,088) (4.4) %

Total revenues $ 352,060 $ 186,063 $ 165,997 89.2 %

_____________________________________________

n/m - Not applicable or not meaningful.

Total revenues increased $121.4 million to $689.2 million during the nine months ended September 30, 2025 from $567.8 million during the nine months ended September 30, 2024.

The increase in revenues during the nine months ended September 30, 2025 was primarily due to increases in revenue from fair value adjustments on loans of $253.3 million, and in the fair value of the portfolio of securities and other investments owned of $114.7 million, partially offset by decreases in revenues from services and fees of $116.3 million, interest income from securities lending of $64.1 million, interest income from loans of $42.8 million, and sale of goods of $23.5 million.

Of the $253.3 million increase in fair value adjustments related to loans, $222.0 million related to VCM, $23.0 million related to the loan to Conn’s, $14.6 million related to the loan to Freedom VCM, and $6.2 million related to Badcock, partially offset by a decrease of $8.5 million related to Core Scientific, Inc.

(“Core Scientific”).

The decrease in revenue of $116.3 million from services and fees in the

nine months ended September 30, 2025 consisted of decreases in revenue of $41.8 million in the Communications segment, $35.7 million in the Wealth Management segment, $22.9 million in All Other, $11.4 million in the Capital Markets segment, and $4.5 million in the E-Commerce segment.

Revenues from services and fees in the Capital Markets segment decreased $11.4 million to $129.7 million during the nine months ended September 30, 2025 from $141.0 million during the nine months ended September 30, 2024.

The decrease in revenues was primarily due to decreases of $7.6 million of corporate finance, consulting, and investment banking fees, $4.7 million in commission fees, $3.3 million in interest income and $1.1 million in dividends, $1.0 million in other income, partially offset by an increase of $4.1 million in advisory fees related to the Innovation X and GACP II funds and $1.6 million in asset management fees.

The decrease in investment banking revenues is related to the episodic nature of this business and the decline in business due to the late SEC filings of the parent company, partially offset by an increase in the number of transactions when compared to the prior period driven in part by the public announcement of the BRSH carve out.

The decreases in investment banking revenues were $13.5 million in at the market fees, $9.2 million in mergers and acquisitions advisory fees, partially offset by increases of $8.6 million in private placement fees, and $6.5 million in investment banking underwriting fees.

Revenues from the Wealth Management segment are comprised of the following:

Nine Months Ended

September 30,

Revenues - Services and fees

Brokerage revenues $ 52,297 $ 69,613

Advisory revenues 39,396 59,501

Other 22,736 21,039

Total services and fees revenue 114,429 150,153

Services and Fees Revenues

Total decrease in services and fees revenues during the three months ended March 31, 2026, compared to the same period in the prior year, was primarily due to the following:

• $(12.0) million decrease in Corporate and All Other non-reportable operating segments driven by decreases of $7.0 million due to the sale of Atlantic Coast Recycling in the prior year quarter, $3.5 million due to the deconsolidation of our investments in Nogin, Inc.

(“Nogin”) and a $0.9 million decline at bebe;

• $(4.6) million decrease in Wealth Management segment driven by a $9.2 million decline in wealth and asset management fees following the sale of a portion of the Company’s wealth management business to Stifel Financial Corp.

(“Stifel”) in April 2025, partially offset by $4.8 million in SpaceX SPV carried interest revenue;

• $(1.5) million decrease in Marconi Wireless segment, driven by lower service revenues attributable to an ongoing decline in active customers;

• $(1.0) million decrease in magicJack segment, driven by fewer active customers driving lower renewal revenues, fewer device sales and first-year service customers, and a decline in ancillary services such as porting, number services, and termination fees;

• $(0.8) million decrease in UOL segment, driven by declines in internet access subscribers in addition to discontinuing telecom resale services;

• $(0.8) million decrease in Lingo segment, driven by fewer POTS and broadband subscribers as customers migrated to VoIP services, partially offset by VoIP growth from those same conversions;

partially offset by

• $14.0 million increase in Capital Markets segment, driven by higher M&A and advisory fees of $9.9 million, increased private placement revenues of $3.8 million, higher secondary commissions of $2.2 million, increased finder fees of $1.6 million, and higher underwriting revenues of $1.3 million, partially offset by a $5.2 million decrease in ATM fees.

Trading Gains (Losses), Net

Total revenues $ 128,302 $ 152,714

Revenues from brokerage and advisory decreased $37.4 million to $91.7 million during the nine months ended September 30, 2025 from $129.1 million during the nine months ended September 30, 2024.

Refer to Note 4 to the accompanying unaudited condensed consolidated financial statements for additional information.

Total assets under management were approximately $13.3 billion and $25.7 billion at September 30, 2025 and September 30, 2024, respectively.

Of these amounts, advisory assets under management totaled approximately $4.2 billion at September 30, 2025 and $8.1 billion at September 30, 2024.

Advisory revenues were 0.26% and 0.25% of average advisory assets under management during the nine months ended September 30, 2025 and 2024, respectively.

The average revenues earned on advisory assets under management are not expected to fluctuate significantly from period to period as a percentage of advisory assets under management.

Brokerage revenues are primarily comprised of commissions and fees earned from trading activities from brokerage client assets.

Other revenues is primarily comprised of tax service fees and management fees earned from comprehensive client focused services performed.

Revenues from services and fees in the Communications segment decreased $41.8 million to $183.3 million during the nine months ended September 30, 2025 from $225.1 million during the nine months ended September 30, 2024.

The decrease in revenues was primarily due to decreases in subscription revenue of $41.1 million, $24.8 million of which related to divestiture of the Lingo wholesale carrier business in third quarter of fiscal year 2024.

Of the remaining $16.3 million decrease in subscription revenue, $8.0 million was from Lingo, $4.3 million was from Marconi Wireless, $3.0 million was from magicJack, and $1.0 million was from UOL.

We expect Lingo, UOL, magicJack, and Marconi Wireless subscription revenue to continue to decline year-over-year as landline and VoIP technologies are older and cellular services are offered in a highly competitive marketplace.

Revenues from services and fees in the E-Commerce segment were $3.5 million during the nine months ended September 30, 2025.

This segment consisted of Nogin which we deconsolidated in the first quarter of 2025.

Refer to Note 3 to the accompanying unaudited condensed consolidated financial statements for additional information.

Revenues from services and fees in All Other decreased $22.9 million to $44.5 million during the nine months ended September 30, 2025 from $67.4 million during the nine months ended September 30, 2024.

These revenues include merchandise rental fees and sales from bebe, and the operations of a regional environmental services business, which was sold in the first quarter of 2025.

Revenues from services and fees in All Other decreased by $21.3 million due to the operations of a regional environmental services business, and $3.8 million related to merchandise rental fees from bebe, partially offset by an increase of $2.2 million in other revenue.

Trading gains (losses), net increased $114.7 million to income of $64.5 million during the nine months ended September 30, 2025 compared to a loss of $50.2 million during the nine months ended September 30, 2024.

The income of $64.5 million during the nine months ended September 30, 2025 was primarily due to realized and unrealized income on investments made in our proprietary trading accounts, primarily gains of $42.2 million for Applied Digital and $19.6 million for B&W.

Total increase in net trading gains (losses) during the three months ended March 31, 2026, compared to the same period in the prior year, was primarily due to the following:

• $152.6 million increase in Capital Markets segment, driven by gains of $130.0 million in B&W, $3.9 million in Applied Digital Corporation (“APLD”), and $2.4 million in U.S.

Treasuries, compared to a $15.1 million loss in the prior period;

• $9.5 million increase in Wealth Management segment, driven by revenue from the APLD Variable Rate Transactions (“VRT”);

partially offset by

• $(0.8) million decrease in Corporate and All Other non-reportable operating segments driven by overall increase in unrealized losses for certain equity securities in the current year period.

Fair Value Adjustments On Loans

In our Capital Markets segment, we have a portfolio of loans receivable that are measured at fair value with changes in fair value reported in our results of operations.

The loan portfolio and fair value adjustments on loans consisted of the following:

Fair Value Adjustments on Loans

Loans Receivable, at Fair Value Nine Months Ended

September 30,

Industry or Type of Loan September 30, 2025 December 31, 2024

Related Party Loans:

Fair Value Adjustments on Loans Receivables

At Fair Value Three Months Ended March 31,

Industry or Type of Loan March 31, 2026 December 31, 2025 2026 2025

Related Party Loans Receivable:

Vintage Capital Management, LLC Retail / consumer $ — $ 1,835 $ 20 $ 276

Badcock Corporation Consumer receivable portfolio — — — 250

Freedom VCM Receivables, Inc.

Consumer receivable portfolio — — — 1,393

Retail / consumer — 38,826 (4,065) (27,084)

Badcock Corporation Consumer receivable portfolio — 2,169 250 (5,993)

Great American Holdings, LLC Professional Services 25,000 — — —

Other related party loans Professional Services, Industrials 1,542 4,937 (9) 3,470

Total related party 27,845 51,902 (3,185) (265,512)

Exela Technologies, Inc.

Technology 25,173 32,136 693 47

Core Scientific, Inc.

Technology — — — 8,473

Retail / consumer n/a — n/a (4,065)

Other related party loans Services, oil & gas and industrial 953 1,000 (46) —

Total related party loans receivable 953 2,835 (26) (2,146)

XBP Americas, LLC Technology 21,825 21,415 (95) (2,677)

Norlin EV Limited Real estate — 10 22 (227)

Other loans Various 2,000 — (3,045) (2,329)

Total $ 55,018 $ 90,103 $ (5,997) $ (259,260)

During the nine months ended September 30, 2025 and 2024, fair value adjustments for loans receivable from related parties totaled $(3.2) million and $(265.5) million, respectively.

During the nine months ended September 30, 2025 and 2024, fair value adjustments for other loans receivable totaled $(2.8) million and $6.3 million, respectively.

The $253.3 million favorable variance in fair value adjustment related to our loans receivable during the nine months ended September 30, 2025 was primarily driven by losses from fair value adjustments recorded in the prior year period of $222.7 million related to VCM loan, $27.1 million related to the loan to Conn’s, $13.2 million related to the loan to

Freedom VCM, and $6.0 million related to Badcock loan with no fair value adjustments of comparable magnitude recorded in the current year period, partially offset by a favorable variance of $8.5 million from a realized loss recorded in the prior year period related to the equity conversion of the Core Scientific loan.

Interest income - loans decreased $42.8 million to $9.1 million during the nine months ended September 30, 2025 from $51.9 million during the nine months ended September 30, 2024.

The decrease was primarily due to non-accrual of interest on the following adjusted loans:

$15.6 million for VCM, $7.4 million for Conn’s, $5.9 million for Freedom VCM, which was sold in February 2025, and $3.5 million for Nogin, as well as a reduction in loan receivable balances from $151.7 million as of September 30, 2024 to $55.0 million as of September 30, 2025.

Interest income – securities lending decreased $64.1 million to $5.5 million during the nine months ended September 30, 2025 from $69.6 million during the nine months ended September 30, 2024.

The decrease was due to counterparties constraining their business activity and a reduced strategic focus and deployment of capital in securities lending, which led to lower average securities lending balances.

Revenues from the sale of goods decreased $23.5 million to $140.8 million during the nine months ended September 30, 2025 from $164.3 million during the nine months ended September 30, 2024.

The decrease in revenues from sale of goods was attributable to decreases of $20.4 million from the Consumer Products segment due to a decrease in computer and peripheral sales worldwide, $2.5 million from Nogin in the E-Commerce segment, $0.3 million from the Communications segment, and $0.3 million from All Other consisting of sale of goods from bebe.

Retail / consumer — n/a 6,670 n/a

Other loans receivable Various 2,149 2,043 (26) (3,046)

Total loans receivable $ 24,927 $ 26,303 $ 6,545 $ (8,096)

(1) The Conn’s, Inc.

loan receivable was written off in January 2026 and is no longer a related party loan receivable.

Recovery of proceeds from the loan receivable is contingent upon collecting amounts from the Conn’s bankruptcy estate.

During the three months ended March 31, 2026, the Company recovered $6,670 of proceeds from the Conn’s bankruptcy estate and is reported as a fair value adjustment.

The $14.6 million favorable variance in fair value adjustments related to our loans receivable during the three months ended March 31, 2026, when compared to the same period in the prior year, was primarily driven by unfavorable adjustments of $4.1 million, $2.7 million, and $3.0 million recorded for loans receivable with Conn’s, Inc., XBP Americas, LLC (formerly Exela Technologies, Inc.), and other non-related party loans receivable, respectively, in the prior year period with no adjustments of comparable magnitude recorded in the current year period, and a $6.7 million favorable adjustment recorded in the current year period related to the recovery of proceeds from the Conn’s, Inc.

bankruptcy estate.

These were partially offset by a $1.4 million favorable adjustment related to Freedom VCM Receivables, Inc.

recorded in the prior year quarter with no fair value adjustments of comparable magnitude recorded in the current year period.

Interest Income - Loans

The $(1.5) million decrease in interest income related to loans receivable for the three months ended March 31, 2026, compared to the same period in the prior year, was primarily due to declines across the XBP Americas, LLC and GA Group portfolios, which decreased by $0.9 million and $0.5 million, respectively.

Interest Income - Securities Lending

The $0.4 million increase in interest income related to securities lending was driven by a higher volume of securities on loan, partially offset by lower average spreads earned on those loans compared to the prior period.

Sale Of Goods

The decrease in sale of goods revenue during the three months ended March 31, 2026, compared to the same period in the prior year, was primarily due to the following:

• $(3.6) million decrease in the Corporate and All Other non-reportable operating segments driven primarily by a $3.5 million decrease due to the deconsolidation of Nogin in the prior year quarter;

• $(0.4) million decrease in the Marconi Wireless segment, driven by lower product sales attributable to an ongoing decline in active customers;

partially offset by

• $2.0 million increase in the Consumer Products segment, driven by stronger distributor demand ahead of anticipated price increases from rising transportation costs, compared to an unusually weak prior period impacted by tariff uncertainty.

Operating Expenses

Direct cost of services

Direct cost of services decreased $60.8 million to $107.2 million during the nine months ended September 30, 2025 from $168.0 million during the nine months ended September 30, 2024.

The decrease in direct cost of services was primarily attributable to decreases of $41.2 million from the Communications segment, $26.9 million of which was attributable to divestiture of the Lingo wholesale carrier business in third quarter of fiscal year 2024, and $16.6 million from All Other consisting of $14.8 million from the regional environmental services business, which was sold in the first quarter of 2025, and $1.8 million from bebe.

The decrease in direct cost of services during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to the following:

• $6.9 million decrease from the Corporate and All Other category primarily driven by decreases of $4.9 million due to the sale of Atlantic Coast Recycling and $1.6 million due to the deconsolidation of Nogin in the prior year quarter;

• $2.1 million decrease from the Marconi Wireless segment due to fewer active lines and migration of its customer base to a lower-cost third-party network;

• $1.5 million decrease from the Lingo segment due to lower POTS unit volume, consistent with the decline in POTS revenue, partially offset by higher costs associated with the conversion to VoIP services;

• $0.3 million decrease from the magicJack segment due to lower carrier charges, reduced salary costs from restructuring, and lower professional services and depreciation;

• $0.3 million decrease from the UOL segment due to lower telecom costs due to declines in internet access subscribers in addition to discontinuing telecom resale services.

Cost of goods sold

Cost of goods sold for the nine months ended September 30, 2025 decreased $12.1 million to $106.8 million from $118.9 million during the nine months ended September 30, 2024.

The decrease in cost of goods sold was primarily attributable to decreases of $11.0 million in the Consumer Products segment, due to lower sales volume, and $0.6 million from the E-Commerce segment, consisting of Nogin which we acquired in the second quarter of 2024 and deconsolidated in the first quarter of 2025, $0.4 million from All Other consisting of bebe, and $0.1 million in the Communications segment.

The decrease in cost of goods sold during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to the following:

• $3.2 million decrease from the Corporate and All Other category primarily driven by a $3.1 million decrease from the deconsolidation of Nogin in the prior year quarter;

• $0.7 million decrease from the Marconi Wireless segment driven by lower product costs resulting from a decrease in the quantity of phones sold;

• $0.5 million decrease from the Consumer Products segment due to improved product margins driven by price increases and a favorable shift in product mix toward higher margin products, partially offset by higher inventory reserve charges recorded in the prior year quarter;

• $0.1 million decrease from the magicJack segment due to lower hardware-related costs resulting from a decline in product sales, partially offset by an increase in shipping and freight costs.

Selling, general and administrative expenses

Selling, general and administrative expenses during the nine months ended September 30, 2025 and 2024 were comprised of the following:

Nine Months Ended

September 30, 2025 Nine Months Ended

September 30, 2024 Change

Selling, general and administrative expenses during the three months ended March 31, 2026 and 2025 were comprised of the following:

Three Months Ended March 31, 2026 Three Months Ended

March 31, 2025 Change

Amount % Amount % Amount %

1 unchanged sentence

Wealth Management segment 36,191 26.9 % 45,554 27.2 % (9,363) (20.6) %

Communications segment 59,972 13.2 % % 70,886 13.7 % % (10,914) (15.4) % %

Lingo segment 13,363 9.9 % 13,990 8.4 % (627) (4.5) %

magicJack segment 2,543 1.9 % 2,861 1.7 % (318) (11.1) %

Marconi Wireless segment 1,714 1.3 % 2,264 1.4 % (550) (24.3) %

UOL segment 453 0.3 % 605 0.4 % (152) (25.1) %

Consumer Products segment 15,578 11.6 % 15,615 9.3 % (37) (0.2) %

E-Commerce segment 8,428 1.9 % % 15,126 2.9 % % (6,698) (44.3) % %

Corporate and All Other 30,347 22.6 % 49,150 29.4 % (18,803) (38.3) %

79,910 17.6 % % 96,150 18.6 % % (16,240) (16.9) % %

Total selling, general & administrative expenses $ 134,348 100.0 % $ 167,388 100.0 % $ (33,040) (19.7) %

Total selling, general and administrative expenses decreased by $64.4 million to $453.6 million during the nine months ended September 30, 2025 from $518.0 million during the nine months ended September 30, 2024.

The decrease was primarily due to decreases of $27.9 million in the Wealth Management segment, $16.2 million in Corporate and All Other, $10.9 million in the Communications segment, $6.7 million in the E-Commerce segment, and $6.7 million in the Consumer Products segment, partially offset by an increase of $4.1 million in the Capital Markets segment.

Capital Markets

Selling, general and administrative expenses in the Capital Markets segment increased by $4.1 million to $139.9 million during the nine months ended September 30, 2025 from $135.8 million during the nine months ended September 30, 2024.

The increase was primarily due to increases of $1.8 million in professional services, an increase of $3.5 million in other expenses, partially offset by decreases of $0.7 million in occupancy-related costs, and $0.5 million in employee compensation and benefit related expenses, which primarily related to decreases in commissions paid, share based compensation and other payroll expenses related to reduced revenue and loss of headcount.

The decrease in selling, general and administrative expenses in the Capital Markets segment during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to the following:

• $6.8 million decrease in other selling, general and administrative expenses primarily due to lower corporate allocations, the absence of non-recurring charges incurred in the prior period, lower bad debt expense reflecting a reserve established in the prior period that was not repeated, and higher transaction costs in the prior period related to a carve-out that did not recur;

• $0.4 million decrease in depreciation and amortization due to the expiration of an office lease during the current period, resulting in no further amortization for that location;

• $0.4 million decrease in occupancy-related costs primarily due to the expiration of two office leases during the period, generating combined savings, partially offset by moving costs incurred in connection with office relocations during the current period;

partially offset by

• $4.5 million increase in employee compensation and benefits driven by higher primary commissions resulting from increased investment banking revenues during the period.

Wealth Management

Selling, general and administrative expenses in the Wealth Management segment decreased by $27.9 million to $120.7 million during the nine months ended September 30, 2025 from $148.6 million during the nine months ended September 30, 2024.

The decrease was primarily due to a decrease of $26.1 million in employee compensation and benefit related expenses, which primarily related to decreases in commissions paid, bonuses and other payroll expenses due to a decrease in headcount, which aligns with the decrease in revenue, $3.8 million in change in fair value of contingent consideration, and $1.3 million in depreciation and amortization, partially offset by increases of $2.4 million in occupancy-related costs, due to multiple office closures and lease impairments as a result of the Stifel transaction, and $0.9 million in other expenses.

Communications

Selling, general and administrative expenses in the Communications segment decreased $10.9 million to $60.0 million for the nine months ended September 30, 2025 from $70.9 million for the nine months ended September 30, 2024.

The decrease was primarily due to decreases of $4.7 million in employee compensation and benefit related expenses due to lower headcount, lower commissions and sale of the Lingo carrier business in the third quarter of 2024, $2.4 million in depreciation and amortization expenses due to items being fully amortized in 2024, $1.8 million in occupancy-related costs, $1.7 million in professional services, and $0.3 million in other expenses.

The decrease in selling, general and administrative expenses in the Wealth Management segment during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to the sale of a portion of the Company’s wealth management business to Stifel in April 2025 and the departure of advisors and support staff.

The decrease was driven by the following:

• $4.8 million decrease in other selling, general and administrative expenses;

• $2.5 million decrease in employee compensation and benefits, partially offset by bonus accruals related to APLD VRT and unrealized carried interest;

• $1.3 million decrease in occupancy-related costs;

• $0.6 million decrease in depreciation and amortization;

• $0.2 million decrease in professional services primarily due to fewer legal cases and related consulting fees.

The decrease in selling, general and administrative expenses in the Lingo segment during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to the following:

• $0.2 million decrease in employee compensation and benefits primarily due to lower salaries from a reduction in force, partially offset by higher allocated personnel costs from affiliates;

• $0.2 million decrease in professional services primarily due to lower audit-related costs and legal fees;

• $0.2 million decrease in occupancy-related costs primarily due to reduced software and computer-related expenses following the reduction in force;

• $0.1 million decrease in depreciation and amortization primarily due to certain software assets becoming fully amortized in 2025.

The decrease in selling, general and administrative expenses in the magicJack segment during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to the following:

• $0.2 million decrease in professional services primarily due to lower outside consulting costs from reduced allocations and decreased legal services activity;

• $0.1 million decrease in other selling, general and administrative expenses primarily due to reduced headcount and outside consulting costs, partially offset by higher corporate cost allocations.

Marconi Wireless

The decrease in selling, general and administrative expenses in the Marconi Wireless segment during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to the following:

• $0.4 million decrease in employee compensation and benefits primarily due to headcount reductions and severances paid in 2025 due to terminations;

• $0.1 million decrease in occupancy-related costs primarily due to a reduction in chat services costs, reflecting lower third-party headcount following the Company’s completion of its platform migration in 2025.

The decrease in selling, general and administrative expenses in the UOL segment during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to the following:

• $0.1 million decrease in employee compensation and benefits primarily due to reduction in headcount.

Consumer Products

Selling, general and administrative expenses in the Consumer Products segment decreased $6.7 million to $44.7 million for the nine months ended September 30, 2025 from $51.5 million during the nine months ended September 30, 2024.

The decrease was primarily due to decreases of $3.7 million in professional services, $2.1 million in employee compensation and benefit related expenses due to reduced headcount, and $0.9 million in other expenses.

Selling, general and administrative expenses in the E-Commerce segment decreased $6.7 million to $8.4 million during the nine months ended September 30, 2025 from $15.1 million for the nine months ended September 30, 2024.

The E-Commerce segment was composed of Nogin which was acquired in the second quarter of 2024 and deconsolidated in the first quarter of 2025.

Refer to Note 3 to the accompanying unaudited condensed consolidated financial statements for additional information.

The decrease in selling, general and administrative expenses in the Consumer Products segment during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to the following:

• $0.6 million decrease in employee compensation and benefits primarily due to lower headcount as the Company continues to implement workforce reductions, which are expected to continue over the near term;

• $0.3 million decrease in depreciation and amortization primarily due to certain fixed assets becoming fully depreciated during the prior period;

mostly offset by

• $0.5 million increase in professional services primarily due to legal fees incurred in connection with the Targus/FGI Credit Agreement and higher audit fees during the current period;

• $0.2 million increase in other selling, general and administrative expenses primarily due to higher personnel costs within the Global Sourcing Group;

• $0.1 million increase in occupancy-related costs primarily due to higher IT costs incurred in connection with the Company’s ERP system implementation during the current period.

Corporate and All Other

Selling, general and administrative expenses for Corporate and All Other decreased $16.2 million to $79.9 million during the nine months ended September 30, 2025 from $96.2 million for the nine months ended September 30, 2024.

The decrease was primarily due to decreases of $12.1 million in employee compensation and benefit related expenses primarily driven by decreases in corporate compensation and from the regional environmental services business which was sold in the first quarter of 2025, $3.9 million in other expenses, $3.2 million in occupancy-related costs, $1.6 million in depreciation and amortization expense and $1.2 million in insurance expense, partially offset by increases of $4.4 million in transaction costs from the regional environmental services business which was sold in the first quarter of 2025, and $1.4 million in professional services.

Impairment of Goodwill and Tradenames.

We recognized non-cash impairment charges of $1.5 million during the nine months ended September 30, 2025 related to tradenames in the Consumer Products segment.

We recognized non-cash impairment charges of $27.7 million during the nine months ended September 30, 2024 consisting of $26.7 million of goodwill and $1.0 million of tradenames in the Consumer Products segment.

Interest Expense - Securities Lending and Loan Participations Sold.

Interest Expense - Securities Lending and Loan Participations Sold decreased $60.3 million to $4.8 million during the nine months ended September 30, 2025 from $65.1 million for the nine months ended September 30, 2024.

The decrease was due to a reduced strategic focus and deployment of capital in securities lending, which led to lower average securities lending balances.

The decrease in selling, general and administrative expenses in the Corporate and All Other category during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to the following:

• $8.4 million decrease due to the deconsolidation of Nogin in the prior year quarter;

• $4.8 million decrease due to the sale of Atlantic Coast Recycling;

• $3.9 million decrease in other selling, general and administrative expenses driven primarily by an impairment of a loan receivable, costs associated with the merger of B.

Riley Securities Holdings, Inc .

with a shell corporation, and losses on the extinguishment of debt recognized in the prior year quarter;

• $1.6 million decrease in employee compensation and benefits primarily driven by decreases in employee compensation and occupancy-related costs at bebe due to a reduction in store count, and decreases at Corporate due to lower share-based compensation expense resulting from the vesting of previously granted shares with no new grants issued, and a reduction in headcount;

partially offset by

• $0.7 million increase in professional services driven by higher spend on audit and accounting services.

Other Income (Expense).

Other income included interest income of $3.5 million and $2.9 million during the nine months ended September 30, 2025 and 2024, respectively.

Dividend income was $0.8 million during the nine months ended September 30, 2025 compared to $4.1 million during the nine months ended September 30, 2024.

Realized and unrealized losses on investments was a gain of $28.5 million during the nine months ended September 30, 2025 compared to a loss of $212.4 million during the nine months ended September 30, 2024, which is comprised of the following:

Other income included interest income of $0.4 million and $1.5 million during the three months ended March 31, 2026 and 2025, respectively.

Dividend income was $0.7 million during the three months ended March 31, 2026 compared to $0.1 million during the three months ended March 31, 2025.

Realized and unrealized (losses) gains on investments was a gain of $105.1 million during the three months ended March 31, 2026 compared to a loss of $14.5 million during the three months ended March 31, 2025, which is comprised of the following:

Realized and Unrealized Gains (Losses)

Nine Months Ended September 30,

Three Months Ended March 31,

Other Income (Expense) - Realized & Unrealized Gains (Losses)

4 unchanged sentences

- preferred stock — (462)

Alta Equipment Group, Inc.

- common stock — (3,537)

Double Down Interactive Co., Ltd - common stock (680) (2,077)

Synchronoss Technologies, Inc.

- common stock — 9,940

Applied Digital Corporation - common stock 1,400 —

2 unchanged sentences

Private Equity Securities:

Freedom VCM Holdings, LLC — (221,042)

Kanaci Technologies, LLC — (12,001)

BJES Holdings, LLC — (35,892)

Other private equities (591) (1,622)

1 unchanged sentence

Corporate bonds (860) 1,357

Partnership interest and other — (1,002)

Total $ 105,100 $ (14,500)

The favorable variance of $240.8 million was primarily due to unfavorable fair value adjustments recorded in the prior year period of $221.0 million for Freedom VCM, $35.9 million for BJES Holdings, LLC, and $12.0 million for Kanaci Technologies, LLC, and $18.6 million in the addition of our investment in Applied Digital Corporation in the current year.

These increases were partially offset by a favorable fair value adjustment recorded in the prior year period of $35.0 million for Double Down Interactive Co., Ltd.

Other income (expense) also includes change in fair value of financial instruments and other was a gain of $9.5 million during the nine months ended September 30, 2025.

Gain on senior note exchange was $67.2 million during the nine months ended September 30, 2025.

Income from equity investments was $34.2 million during the nine months ended September 30, 2025.

Loss on extinguishment of debt was $21.6 million during the nine months ended September 30, 2025 compared to a loss of $5.8 million during the nine months ended September 30, 2024.

Interest expense was $72.7 million during the nine months ended September 30, 2025 compared to $102.2 million during the nine months ended September 30, 2024.

The decrease in interest expense was due to lower debt balances during the nine months ended September 30, 2025.

The decreases in interest expense primarily consisted of $16.1 million from the Nomura term loan, $16.0 million from the issuance of senior notes, $4.2 million from the Lingo term loan, $1.4 million from the Nomura revolving credit facility, $1.5 million and $0.6 million from the Targus term loan and revolver, respectively, and $0.2 million from the Nogin secured convertible promissory note, partially offset by increases in interest expense of $9.1 million from the Oaktree term loan, $1.8 million from the BRPAC term loan and $0.1 million from the Targus FGI loan.

Provision for Income Taxes.

Provision for income taxes was $1.2 million during the nine months ended September 30, 2025 compared to $17.8 million during the nine months ended September 30, 2024.

The effective income tax rate was 0.8% for the nine months ended September 30, 2025 as compared to 2.8% for the nine months ended September 30, 2024.

Income (Loss) From Discontinued Operations, Net Of Income Taxes.

On October 25, 2024, we and our subsidiary bebe have completed a transaction for our brand assets yielding approximately $236.0 million in cash proceeds.

The results have been presented as discontinued operations for the six months ended June 30, 2024.

Loss from discontinued operations, net of tax for Brands Transaction was $(112.6) million during the nine months ended September 30, 2024.

On November 15, 2024, we completed the sale of our Great American Group, and its results have been presented as discontinued operations for the nine months ended September 30, 2024.

Loss from discontinued operations, net of tax for Great American Group was $(11.2) million during the nine months ended September 30, 2024.

On June 27, 2025, we signed an equity purchase agreement to sell all of the membership interests of GlassRatner and Farber, and their results have been presented as discontinued operations for the nine months ended September 30, 2025 and 2024.

Income from discontinued operations, net of tax for GlassRatner and Farber was $70.8 million for the nine months ended September 30, 2025, compared to income from discontinued operations of $15.6 million during the nine months ended September 30, 2024.

Refer to Note 4 to the accompanying unaudited condensed consolidated financial statements for additional information.

The favorable variance of $119.6 million was primarily due to a $110.6 million change in realized and unrealized gains on B&W common stock, driven by an increase in the company’s public share price during the period.

Other income (expense) also includes changes in the fair value of financial and other instruments reflecting a loss of $4.4 million during the three months ended March 31, 2026 primarily related to unrealized losses on liability-classified warrants.

Gain on sale and deconsolidation of businesses of $80.8 million during the three months ended March 31, 2025 was primarily related to $52.4 million net gain on the sale of Atlantic Coast Recycling, as more fully discussed in Note 4 - Discontinued Operations and Assets Held For Sale, and $28.4 million related to the deconsolidation of Nogin.

Gain on senior note exchange was $10.5 million during the three months ended March 31, 2025 related to private transactions with institutional investors whereby senior notes were exchanged for new notes bearing interest at 8.00% due in 2028, as more fully discussed in Note 15 - Senior Notes Payable.

Income from equity investments was $1.3 million during the three months ended March 31, 2026, compared to a loss of $(0.6) million during the three months ended March 31, 2025.

Gain on extinguishment of debt during the three months ended March 31, 2026 was $2.9 million due to Section 3(a)(9) exchanges, compared to a loss of $10.4 million during the three months ended March 31, 2025 due to amendments to credit agreements with Oaktree, Nomura, and BRPI Acquisition Co LLC (“BRPAC”), as more fully discussed in Note 14 - Term Loans and Revolving Credit Facility.

Interest expense was $19.8 million during the three months ended March 31, 2026, compared to $30.0 million during the three months ended March 31, 2025.

The decreases in interest expense primarily consisted of $10.0 million from Corporate and All Other primarily due to lower debt balances.

(Provision for) benefit from income taxes.

(Provision for) benefit from income taxes was $(16.9) million during the three months ended March 31, 2026, compared to $3.0 million during the three months ended March 31, 2025.

The effective income tax rate was 7.1% for the three months ended March 31, 2026, as compared to 13.2% for the three months ended March 31, 2025.

Income From Discontinued Operations, Net Of Income Taxes.

On June 27, 2025, we signed an equity purchase agreement to sell all of the membership interests of GlassRatner Advisory & Capital Group, LLC (“GlassRatner”) and B.

Riley Farber Advisory Inc.

(“Farber”), and their results have been presented as discontinued operations for the three months ended March 31, 2025.

Income from discontinued operations, net of tax, for GlassRatner and Farber was $3.4 million for the three months ended March 31, 2025.

Refer to Note 4 -Discontinued Operations and Assets Held for Sale to the accompanying unaudited condensed consolidated financial statements for additional information.

Preferred Stock Dividends .

Preferred stock dividends were $6.0 million for the nine months ended September 30, 2025 and 2024.

Dividends on the Series A preferred paid during the nine months ended September 30, 2024 were $0.4296875 per depository share.

Dividends on the Series B preferred paid during the nine months ended September 30, 2024 were $0.4609375 per depository share.

Preferred stock dividends accrued were $2.0 million for the three months ended March 31, 2026 and 2025.

On January 21, 2025, the Company announced that we had temporarily suspended dividends on our Series A and B Preferred Stock.

Unpaid dividends will accrue until paid in full.

On April 30, 2026, the sixth quarterly Dividend Period (as defined in the applicable Certificate of Designation) for which dividends on our Series A Preferred Stock and Series B Preferred Stock have not been paid since the suspension occurred.

See Note 27 – Subsequent Events.

Liquidity and Capital Resources

Our operations are funded through a combination of existing cash on hand, cash generated from operations, investment portfolio liquidity, borrowings under our senior notes payable, term loans and credit facilities, other financing arrangements, and obligations under operating leases.

During the nine months ended September 30, 2025 and 2024, we generated net income (loss) attributable to the Company of $220.6 million and $(767.2) million, respectively.

The Company operates several businesses in its segments that provide cash flows and operating income throughout the year.

As of September 30, 2025, we had $184.2 million of unrestricted cash and cash equivalents, $1.3 million of restricted cash, $315.5 million of securities and other investments owned, $55.0 million of loans receivable, at fair value, $1.4 billion of borrowings outstanding, and approximately $48.8 million of obligations under operating leases.

The Company expects to collect approximately $58.7 million of loans at fair value in the next twelve months and has approximately $149.8 million of level 1 securities and other investments owned that are available for sale during the next twelve months.

The Company expects to utilize existing cash balances, cash generated from investments, cash proceeds from the sale of certain businesses described below, available borrowing capacity under our existing revolving credit facility and cash generated from operations to fund debt service obligations over the next twelve months which includes amounts coming due on the Company’s senior notes payable as discussed in Note 12 - Senior Notes Payable.

The Company may also explore various funding options in the future that may include additional debt exchanges, refinancing of existing senior notes and other debt, equity capital raises, the sale of operating companies, or the liquidation of securities and investments owned to provide liquidity to meet future debt obligations as they become due.

The following summarizes key liquidity events.

We completed the sale of (a) the Company’s majority owned subsidiary, Atlantic Coast Recycling, LLC on March 3, 2025 for proceeds of approximately $68.6 million (the “Atlantic Coast Transaction”);

(b) the sale of part of the Wealth Management business for $26.0 million (the “Wealth Management Transaction”) as more fully described in Note 4 to the accompanying unaudited condensed consolidated financial statements;

and (c) the sale of the Company’s financial consulting business on June 27, 2025 for $117.8 million.

In addition to the sale of these businesses, approximately $61.2 million of investments were sold during the nine months ended September 30, 2025 and approximately $4.7 million of investments and loans were sold from October 1, 2025 through December 31, 2025.

Approximately $50.4 million in repayments of loans receivable, fair value were received during the nine months ended September 30, 2025 and approximately $31.4 million in repayments of loans receivable, fair value were received from October 1, 2025 through December 31, 2025.

The sale of additional investments in the next twelve months will vary based upon the realization of the investments providing the best economic value or as liquidity needs arise for the Company.

As discussed in more detail in Note 12 - Senior Notes Payable, on July 11, 2025, the Company completed private exchange transactions with institutional investors pursuant to which aggregate principal amounts of approximately $2.1 million of the 6.50% Senior Notes Payable due September 2026, $19.7 million of the 5.00% Senior Notes due December 2026, $4.7 million of the 6.00% Senior Notes due January 2028, and $16.4 million of the 5.25% Senior Notes due August 2028 (collectively, the “Exchanged Notes”) owned by the investors were exchanged for approximately $24.6 million aggregate principal amount of newly-issued 8.00% Senior Secured Second Lien Notes due 2028 (the “New Notes”), whereupon the Exchanged Notes were cancelled.

The borrowings outstanding of $1.4 billion as of September 30, 2025 included $1.3 billion from the issuance of series of senior notes that are due at various dates ranging from March 31, 2026 to August 31, 2028 with interest rates ranging from 5.00% to 8.00%, $121.9 million in term loans borrowed pursuant to the Oaktree Capital Management, L.P.

(“Oaktree”) and BRPI Acquisition Co LLC (“BRPAC”) credit agreements, and $10.2 million of revolving credit facility under the Targus credit facility.

Of the senior notes outstanding, after the completion of the Exchanged Notes described above, there is $280.1 million due in the next twelve months and $1.0 billion thereafter.

The $131.6 million of term loans outstanding includes $16.0 million that is expected to be repaid in the next twelve months and $115.6 million thereafter.

Of the approximately $48.8 million of obligations due under operating leases, approximately $16.9 million is due in the next twelve months and approximately $32.0 million is due thereafter.

For additional information regarding our debt offerings and related agreements, refer to Note 10 - Notes Payable, Note 11 - Term Loans and Revolving Credit Facility, and Note 12 - Senior Notes Payable to the unaudited condensed consolidated financial statements.

We believe that the current cash and cash equivalents, securities and other investments owned, funds available under our credit facilities, and cash expected to be generated from operating activities will be sufficient to meet our working capital and capital expenditure requirements for at least the next 12 months from issuance date of the accompanying financial statements.

We continue to monitor our financial performance to ensure sufficient liquidity to fund operations and execute on our business plan.

Our operations and debt obligations are funded through a combination of existing cash on hand, cash generated from operations, monetization of investments and asset sales, borrowings under our senior notes payable, term loans and credit facilities, other financing arrangements, and obligations under operating leases.

The Company operates multiple business segments that provide sources of cash flow and operating income, which include a mix of businesses with recurring revenue models and transactional businesses with uneven cashflows.

With our primary business in capital markets and investment banking, we have expertise in accessing public and private capital markets and in transacting investments and operating companies.

We use our expertise to buy and sell assets and investments on our balance sheet and to access private and public capital, which are described in the 2026 activity summarized below.

During the three months ended March 31, 2026, the Company’s sources and uses of cash from investing, financing and operations included the following.

The Company fully redeemed the $96.0 million of outstanding 5.50% Senior Notes due 2026 on the day prior to their maturity date.

During the three months ended March 31, 2026, the Company completed a series of Section 3(a)(9) Exchanges with the Investor whereby the Company exchanged an aggregate principal amount of $36.1 million of senior notes which included (i) $11.0 million of the 5.50% Senior Notes due March 31, 2026, (ii) $11.4 million of the 6.50% Senior Notes due September 30, 2026, (iii) $2.7 million of the 5.00% Senior Notes due December 31, 2026, (iv) $5.6 million of the 6.00% Senior Notes due January 31, 2028, and (v) $5.4 million of the 5.25% Senior Notes due August 31, 2028 for an aggregate of 4,553,866 shares of the Company’s common stock.

The Investor owns more than five percent of the Company’s common stock.

Additionally, from our securities and investments owned we had net proceeds of approximately $8.6 million, which excludes certain trading activity related to broker dealer operations and approximately $8.4 million in net proceeds from loans receivable.

Net cash provided by operating activities was $38.1 million inclusive of a balance sheet increase in Securities and other investments owned of $192.8 million in operating assets.

In the next 12 months, in addition to funding the Company’s operations, several debt obligations will be due including approximately $337.3 million in Senior Note maturities (RILYN in September 2026 and RILYG in December 2026) and a total of $16.0 million in term loan amortization payments.

The Company also has approximately $11.4 million of obligations due under operating leases, along with operational expenditures and investment opportunities in the ordinary course of business.

For additional information regarding our debt obligations and related agreements, refer to Note 14 - Term Loans and Revolving Credit Facility and Note 15 - Senior Notes Payable in the accompanying unaudited condensed consolidated financial statements.

The Company expects capital expenditures to be less than $6.3 million for the next 12 months.

To fund the short-term obligations due in the next 12 months, management plans to use a combination of existing cash on hand, cash generated from continuing operations, proceeds from investment and assets sales, and public and private capital market options.

As of March 31, 2026, the Company had $175.8 million of unrestricted cash and cash equivalents, $2.2 million of restricted cash, $639.7 million of securities and other investments owned, and $24.9 million of loans receivable, at fair value.

Additionally, the Company will evaluate external sources of liquidity including public and private debt refinancing, bond swaps, buybacks or exchanges, and equity capital raises.

Among many factors, the Company considers the timing of debt obligation payoffs, the cost of capital, and future value of assets when determining the sources used to fund debt obligations.

We believe these liquidity sources provide sufficient cash resources to meet our debt obligation and operating cash flow requirements in the next 12 months.

Our long-term debt obligations beyond 12 months include approximately $569.9 million on Senior Notes, $268.0 million Senior Secured Second Lien Notes due 2028 and $62.5 million in Oaktree term loans maturing February 2028.

Additionally, the Company’s term loan through Banc of California has $16.0 million annually in amortization payments due through maturity in January 2030 with approximately $24.1 million of obligations due under operating leases.

The Company has $10.7 million outstanding through the revolving credit facility through FGI as of March 31, 2026, with a final maturity date of August 20, 2028.

The Company expects capital expenditures to be less than $6.3 million annually.

The Company will fund long-term obligations beyond 12 months using the same tactics described in the short-term liquidity.

Additionally, the Company will evaluate operating company sales as a source of long-term liquidity.

As with short-term obligations, the Company considers many factors including timing of debt obligation payoffs, the cost of capital, and future value when determining the source used to fund debt obligations.

As long-term capital planning is a continual process, the Company may also choose to address certain long-term capital and obligations over the next 12 months.

The Company’s debt structure as of March 31, 2026 included borrowings of $1.3 billion primarily comprised of $1.2 billion of Senior Notes and Senior Secured Second Lien Notes with varying maturity dates from September 30, 2026 through August 31, 2028, with fixed interest rates ranging from 5.00% to 8.00%.

Additionally, we have $116.7 million in outstanding term loans borrowed pursuant to the Oaktree Capital Management, L.P.

and BRPI Acquisition Co LLC (“BRPAC”) credit agreements, and $10.7 million of revolving credit facility under the Targus credit facility, which are all subject to variable rates.

The Company is compliant with its debt obligation requirements and maintains processes to monitor ongoing compliance.

For additional information regarding our debt obligations, covenant compliance, and related agreements, refer to Note 14 - Term Loans and Revolving Credit Facility and Note 15 - Senior Notes Payable in the accompanying unaudited condensed consolidated financial statements.

The Company believes it has sufficient excess liquidity to meet our short-term obligations within the next 12 months and will pursue capital market options to reduce long-term debt, extend maturities, or remix our capital structure when advantageous.

There is no assurance on favorable refinancing terms, which will be subject to market conditions and our credit profile.

From time to time, we may decide to pay dividends which will be dependent upon our financial condition and results of operations.

During the three months ended September 30, 2025, we did not pay any cash dividends on our common stock.

During the year ended December 31, 2024, we paid cash dividends on our common stock of $33.7 million.

During the three months ended March 31, 2026, we did not pay any cash dividends on our common stock.

In August 2024, we announced the suspension of our common stock dividend as we prioritize reducing our debt.

The declaration and payment of any future dividends or repurchases of our common stock will be made at the discretion of our board of directors and will be dependent upon our financial condition, results of operations, cash flows, capital expenditures, and other factors that may be deemed relevant by our board of directors.

A summary of common stock dividend activity for the nine months ended September 30, 2025 and the year ended December 31, 2024 was as follows:

Date Declared Date Paid Stockholder Record Date Amount

May 15, 2024 June 11, 2024 May 27, 2024 $ 0.50

February 29, 2024 March 22, 2024 March 11, 2024 0.50

Holders of Series A Preferred Stock, when and as authorized by the board of directors of the Company, are entitled to cumulative cash dividends at the rate of 6.875% per annum of the $0.03 million liquidation preference ($25.00 per Depositary Share) per year (equivalent to $1,718.75 or $1.71875 per Depositary Share).

Dividends are payable quarterly in arrears, on or about the last day of January, April, July, and October.

As of September 30, 2025, dividends in arrears in respect of the Series A Preferred Stock and underlying Depositary Shares were $4.5 million.

Holders of Series A Preferred Stock, when and as authorized by our board of directors, are entitled to cumulative cash dividends at the rate of 6.875% per annum of the $0.03 million liquidation preference ($25.00 per Depositary Share) per year (equivalent to $1,718.75 or $1.71875 per Depositary Share).

Dividends are payable quarterly in arrears.

As of March 31, 2026, dividends in arrears in respect of the Depositary Shares were $6.9 million.

On January 21, 2025, the Company announced that it had temporarily suspended dividends on its Series A Preferred Stock.

Unpaid dividends will accrue until paid in full.

Holders of Series B Preferred Stock, when and as authorized by the board of directors of the Company, are entitled to cumulative cash dividends at the rate of 7.375% per annum of the $0.03 million liquidation preference ($25.00 per Depositary Share) per year (equivalent to $1,843.75 or $1.84375 per Depositary Share).

Dividends are payable quarterly in arrears, on or about the last day of January, April, July, and October.

As of September 30, 2025, dividends in arrears in respect of the Series B Preferred Stock and underlying Depositary Shares were $2.9 million.

On January 21, 2025, the

Company announced that it had temporarily suspended dividends on its Series B Preferred Stock.

Holders of Series B Preferred Stock, when and as authorized by our board of directors, are entitled to cumulative cash dividends at the rate of 7.375% per annum of the $0.03 million liquidation preference ($25.00 per Depositary Share) per year (equivalent to $1,843.75 or $1.84375 per Depositary Share).

Dividends are payable quarterly in arrears.

As of March 31, 2026, dividends in arrears in respect of the Depositary Shares were $4.5 million.

On January 21, 2025, the Company announced that it had temporarily suspended dividends on its Series B Preferred Stock.

Unpaid dividends will accrue until paid in full.

A summary of preferred stock dividend activity for the nine months ended September 30, 2025 and the year ended December 31, 2024 was as follows:

Stockholder Preferred Dividend per Depositary Share

Date Declared Date Paid Record Date Series A Series B

October 16, 2024 October 31, 2024 October 28, 2024 $ 0.4296875 $ 0.4609375

July 9, 2024 July 31, 2024 July 22, 2024 0.4296875 0.4609375

April 9, 2024 April 30, 2024 April 22, 2024 0.4296875 0.4609375

January 9, 2024 January 31, 2024 January 22, 2024 0.4296875 0.4609375

On April 30, 2026, the sixth quarterly Dividend Period for which dividends on the Series A Preferred Stock and Series B Preferred Stock have not been paid since the January 21, 2025 suspension occurred.

As a result, a “Preferred Dividend Default” has occurred under each Certificate of Designation.

See Note 27 – Subsequent Events.

Our principal sources of liquidity to finance our business are our existing cash on hand, cash flows generated from operating activities, funds available under revolving credit facilities and special purpose financing arrangements.

Cash Flow Summary

Nine Months Ended

September 30,

Three Months Ended

(Dollars in thousands)

Net cash (used in) provided by:

Net cash provided by (used in):

Operating activities $ 38,073 $ 184

4 unchanged sentences

$ (51,255) $ (113,629)

Cash used in operating activities was $85.9 million during the nine months ended September 30, 2025 compared to cash provided by operating activities of $266.3 million during the nine months ended September 30, 2024.

The reduction of $352.2 million in net cash provided by operating activities in 2025 was primarily due to $673.3 million less cash generated from securities and other investments owned, as fewer securities positions were sold to provide liquidity to fund operations and redemption of the 6.375% Senior Notes due February 28, 2025, partially offset by an increase of $422.0 million in net income, net of non-cash items.

Cash used in operating activities for the nine months ended September 30, 2025 consisted of the impact of net income of $220.0 million, non-cash items of $172.4 million, and changes in operating assets and liabilities of $133.5 million.

The negative cash flow impact from non-cash items of $172.4 million included gain on sale and deconsolidation of businesses of $86.2 million, gain on senior note exchange of $67.2 million, gain on disposal of discontinued operations of $66.8 million, income from equity investments of $34.2 million, fair value and remeasurement adjustments of $8.6 million, gain on sale or disposal of fixed assets and other of $1.3 million, and net foreign currency gains of $0.5 million, partially offset by depreciation and amortization of $27.2 million, loss on extinguishment of debt of $21.6 million, share-based compensation of $11.0 million, depreciation of rental merchandise of $9.9 million, deferred income taxes of $9.2 million, non-cash interest and other of $9.2 million, provision for losses on accounts receivable of $2.6 million, impairment of goodwill and tradenames of $1.5 million, and dividends from equity investment of $0.2 million.

Cash provided by operating activities for the nine months ended September 30, 2024 consisted of the impact of net loss of $769.3 million, non-cash items of $394.9 million, and changes in operating assets and liabilities of $640.7 million.

The positive cash flow impact from non-cash items of $394.9 million included fair value adjustments of $261.4 million, loss on disposal of discontinued operations of $39.5 million, depreciation and amortization of $34.1 million, impairment of goodwill and tradenames of $27.7 million, deferred income taxes of $20.5 million, share-based compensation of $17.6 million, depreciation of rental merchandise of $11.7 million, provision for losses on accounts receivable of $2.5 million, income allocated for mandatorily redeemable noncontrolling interests of $1.4 million, net foreign currency gains of $0.3 million, partially offset by non-cash interest and other of $26.3 million, and gain on sale of business of $0.8 million.

Cash provided by investing activities was $275.9 million during the nine months ended September 30, 2025 compared to cash provided by investing activities of $25.5 million for the nine months ended September 30, 2024.

The increase of $250.4 million in net cash provided by investing activities in 2025 was primarily due to $114.0 million in proceeds received from the sale of the GlassRatner and Farber business, $68.9 million in proceeds received from the sale of the Atlantic Coast Recycling business, $37.5 million in distributions received from equity investment Joann Retail, a new investment in 2025, $26.0 million in proceeds from the sale of the Wealth Management business, and a decrease of $19.1 million in cash paid for acquisitions, as Nogin was acquired in 2024 and there were no acquisitions in 2025.

During the nine months ended September 30, 2025, cash provided by investing activities consisted of cash provided by proceeds from loans receivable repayment of $137.7 million, sale of discontinued operation of $114.0 million, proceeds from sale of business, net of cash sold and other of $94.9 million, distributions from equity investments of $37.5 million, proceeds from sale of loans receivable of $10.4 million, proceeds from sale of property, equipment, intangible assets and other of $7.6 million, proceeds from sale of loan participations of $4.5 million, and proceeds from consolidation of VIE, partially offset by cash used in purchases of loans receivable of $114.3 million, purchases of property, equipment and intangible assets of $10.3 million, and purchases of equity and other investments of $6.6 million.

During the nine months ended September 30, 2024, cash provided by investing activities consisted of cash received from loans receivable repayment of $105.3 million, proceeds from sale of loans receivable of $22.8 million, and proceeds from sale of loan participations of $4.0 million, partially offset by cash used for purchases of loans receivable of $79.9 million, acquisition of businesses and minority interest of $19.1 million, purchases of property and equipment of $6.7 million, purchases of equity and other investments of $1.1 million, and proceeds from sale of business, net of cash sold and other of $0.3 million.

Cash used in financing activities was $261.0 million during the nine months ended September 30, 2025 compared to cash used in financing activities of $354.7 million during the nine months ended September 30, 2024.

The decrease of $93.7 million in net cash used in financing activities in 2025 was primarily due to a net increase in debt-related proceeds of $47.9 million and the suspension of dividends, compared to $39.7 million paid in common stock and preferred dividends in 2024.

During the nine months ended September 30, 2025, cash used in financing activities primarily consisted of $314.3 million used in the repayment of term loan, $145.3 million used to redeem senior notes, $92.2 million used in payment of revolving line of credit, $13.4 million used to repay our notes payable and other, $13.2 million used to pay debt issuance and offering costs, $3.6 million in distributions to noncontrolling interests, and $1.4 million used to pay contingent consideration, partially offset by cash provided by $235.6 million in proceeds from term loan, $86.1 million in proceeds from revolving line of credit, and $0.9 million in proceeds from notes payable.

During the nine months ended September 30, 2024, cash used in financing activities primarily consisted of $140.5 million used to redeem senior notes, $94.2 million used in repayment of revolving line of credit, $138.6 million used in the repayment of term loan, $33.6 million used to pay dividends on our common shares, $6.2 million used to repay our notes payable and other, $6.0 million used to pay dividends on our preferred shares, $7.4 million used in the payment of contingent consideration, $4.6 million in distributions to noncontrolling interests, $3.5 million used in the payment of debt issuance and offering costs, $3.1 million used in payment of ESPP and employment taxes on vesting of restricted stock, partially offset by cash provided by $64.1 million in proceeds from revolving line of credit, $15.0 million in proceeds from notes payable, $3.2 million in contributions from noncontrolling interests, and $0.7 million in proceeds from exercise of warrants.

The increase of $37.9 million in net cash provided by operating activities in the first quarter of 2026 was primarily due to the following:

• An increase of $288.8 million in net income, net of non-cash items, partially offset by a $242.0 million decrease in cash flows from securities and other investments owned, primarily driven by increased investment activity in equity securities, with higher share prices also contributing to the period-over-period change.

• The increase in net income, net of non-cash items was also partially offset by $8.9 million of net working capital outflows, primarily driven by an increase in accounts receivable primarily due to an increase in investment banking receivables and an increase in securities borrowing activity, partially offset by cash inflows from securities sold, not yet purchased, reflecting net increases in short positions.

The decrease of $50.8 million in net cash provided by investing activities in the first quarter of 2026 was primarily due to the following:

• Proceeds of $68.9 million received from the sale of the Atlantic Coast Recycling business in the prior-year period with no comparable activity in the current period and a decrease in repayments of loans receivable of $18.3 million, partially offset by a decrease in purchases of loans receivable of $41.4 million.

The cash flows from loans receivable were driven by the repayment of certain loans outstanding in the prior-year period that did not recur, offset by the addition of the XBP Americas, LLC facility and recovery of proceeds from the Conn’s, Inc.

bankruptcy estate.

Refer to Note 9 - Loans Receivable, at Fair Value in the accompanying unaudited condensed consolidated financial statements for further details.

The decrease of $75.7 million in net cash used in financing activities in the first quarter of 2026 was primarily due to the following:

• $211.2 million net decrease in debt proceeds and a $288.8 million net decrease in debt-related payments, primarily due to the absence of term loan issuances and related repayments that occurred in the prior-year period and did not recur in the current period, with lower cash paid for the redemption of senior notes also contributing to the decrease in payments.

Recent Accounting Standards

See Note 2(s) - Recent Accounting Standards to the accompanying unaudited condensed consolidated financial statements for recent accounting standards.

See Note 2(o) - Recent Accounting Standards to the accompanying unaudited condensed consolidated financial statements for recent accounting standards.

Quantitative and Qualitative Disclosures About Market Risk.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis