Versant Media Group, Inc. 10-K

Item 8. Financial Statements and Supplementary Data Index Page Report of Independent Registered Public Accounting Firm 43 Combined Statements of Income 45 Combined Statements of Comprehensive Income 46 Combined Statements of Cash Flows 47 Combined Balance Sheets 48 Combined Statements of Changes in Equity 49 Notes to Combined Financial Statements 50 Note 1. Description of the Company and Basis of Presentation 50 Note 2. Summary of Significant Accounting Policies 51 Note 3. Revenue 53 Note 4. Costs of Revenue 56 Note 5. Investments 57 Note 6. Property and Equipment 58 Note 7. Goodwill and Intangible Assets 59 Note 8. Debt Obligations 60 Note 9. Income Taxes 62 Note 10. Commitments and Contingencies 65 Note 11. Related Parties 65 Note 12. Additional Financial Information 66 Note 13. Subsequent Events 67 42 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and the Board of Directors of Versant Media Group, Inc. Opinion on the Financial Statements We have audited the accompanying combined balance sheets of Versant Media Group, Inc. (the “Company”) as of December 31, 2025 and 2024, the related combined statements of income, comprehensive income, changes in equity, and cash flows, for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Goodwill – Television networks reporting unit - Refer to Note 7 to the financial statements Critical Audit Matter Description The Company’s evaluation of goodwill for impairment is performed at the reporting unit level. To determine its reporting units, the Company evaluates the components one level below the segment level and aggregates components if they have similar economic characteristics. The Company performs an assessment of goodwill for recoverability annually as of July 1, or more frequently whenever events or substantive changes in circumstances indicate that the assets might be impaired. A quantitative assessment considers whether the carrying amount of a reporting unit exceeds its fair value, in which case an impairment charge is recorded to the extent the reporting unit’s carrying value exceeds its fair value. 43 Following Versant’s change in chief operating decision maker in 2025, the Company reassessed its reporting units. The Company performed a quantitative assessment in connection with this change and with the annual impairment assessment as of July 1, 2025, and concluded there was no impairment of any of its reporting units. The reporting unit comprised primarily of the Company’s television networks includes $6.49 billion of goodwill. The Company performed an updated quantitative assessment for this reporting unit as of December 31, 2025 given the market price indications for the Company’s Class A common stock and the relative significance of this reporting unit to the overall business. In connection with this assessment, the Company concluded that the estimated fair value of the television networks reporting unit continued to exceed its carrying value. The Company used the discounted cash flow model to estimate fair values, which requires management to make significant judgments related to discount rates and forecasts of expected cash flows. Changes in these assumptions could have a significant impact on the respective fair values. We identified as a critical audit matter the goodwill relative fair value analysis as of July 1, 2025 and the quantitative goodwill impairment assessments as of July 1, 2025, and December 31, 2025, for the Company’s television networks reporting unit because of the significant judgments made by management to estimate the fair values used in these analyses. This required a high degree of auditor judgment and an increased extent of effort, when performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to the selection of the discount rates, revenue growth rates and Adjusted EBITDA margins included in future expected cash flows used in the analysis. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to the selection of the discount rates, revenue growth rates and Adjusted EBITDA margins included in future expected cash flows used by management to estimate the fair values of the television networks reporting unit included the following, among others: • With the assistance of our fair value specialists, we evaluated the reasonableness of the (1) valuation methodology and (2) discount rates, including testing the source information underlying the determination of the discount rates, testing the mathematical accuracy of the calculations, and developing a range of independent estimates and comparing those to the discount rates selected by management. • We evaluated management’s ability to accurately forecast future revenue growth rates and Adjusted EBITDA margins by comparing prior year forecasts to actual results in the respective years. • We evaluated the reasonableness of management’s current forecasts of future revenue growth rates and Adjusted EBITDA margins by comparing such forecasts to historical results, prior year forecasts, and to forecasted information included in analyst and industry reports and companies in its peer group. /s/ Deloitte & Touche LLP New York, New York March 3, 2026 We have served as the Company’s auditor since 2025. 44 VERSANT MEDIA GROUP, INC. COMBINED STATEMENTS OF INCOME Year ended December 31, 2025 2024 2023 (in millions) Revenue (a) $ 6,688 $ 7,062 $ 7,445 Costs and Expenses: Costs of revenue (exclusive of depreciation and amortization) (b) 2,937 3,064 3,154 Selling, general and administrative 1,469 1,167 1,231 Depreciation and amortization 1,010 989 991 Total costs and expenses 5,416 5,220 5,375 Operating income 1,272 1,841 2,069 Interest expense ( 13 ) — — Investment and other (loss) income, net ( 31 ) 1 — Income before income taxes 1,228 1,843 2,069 Income tax expense ( 297 ) ( 478 ) ( 530 ) Net income 931 1,365 1,540 Less: Net income attributable to noncontrolling interests 1 2 — Net income attributable to Versant $ 930 $ 1,363 $ 1,539 (a) Includes related party amounts totaling $ 928 million, $ 1.26 billion and $ 1.34 billion for 2025, 2024 and 2023, respectively. (b) Includes related party amounts totaling $ 1.24 billion, $ 1.42 billion and $ 1.42 billion for 2025, 2024 and 2023, respectively. See accompanying notes to combined financial statements, including Note 11 for amounts of related party transactions. 45 VERSANT MEDIA GROUP, INC. COMBINED STATEMENTS OF COMPREHENSIVE INCOME Year ended December 31, 2025 2024 2023 (in millions) Net income $ 931 $ 1,365 $ 1,540 Other comprehensive income, net of tax: Currency translation adjustments, net of deferred taxes of $ 0 for each period 1 ( 1 ) 1 Comprehensive income 932 1,364 1,541 Less: Net income attributable to noncontrolling interests 1 2 — Comprehensive income attributable to Versant $ 931 $ 1,363 $ 1,541 See accompanying notes to combined financial statements, including Note 11 for amounts of related party transactions. 46 VERSANT MEDIA GROUP, INC. COMBINED STATEMENTS OF CASH FLOWS Year ended December 31, 2025 2024 2023 (in millions) Operating Activities Net income $ 931 $ 1,365 $ 1,540 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 1,010 989 991 Share-based compensation 29 16 15 Net loss on investment activity and other 41 — 1 Deferred income taxes ( 139 ) ( 145 ) ( 135 ) Changes in operating assets and liabilities: Current and noncurrent receivables, net 84 100 41 Content costs, net 99 68 155 Accounts payable 25 ( 3 ) ( 12 ) Other operating assets and liabilities ( 58 ) ( 179 ) ( 167 ) Net cash provided by operating activities 2,022 2,211 2,428 Investing Activities Capital expenditures ( 167 ) ( 54 ) ( 56 ) Acquisition, net of cash acquired ( 24 ) — — Other 36 ( 17 ) ( 4 ) Net cash used in investing activities ( 155 ) ( 71 ) ( 60 ) Financing Activities Proceeds from borrowings 986 — — Change in net Comcast investment ( 1,745 ) ( 2,142 ) ( 2,359 ) Other ( 23 ) ( 12 ) 4 Net cash used in financing activities ( 782 ) ( 2,155 ) ( 2,355 ) Increase (decrease) in cash, cash equivalents and restricted cash 1,084 ( 16 ) 13 Cash and cash equivalents, beginning of year 8 23 11 Cash and cash equivalents and restricted cash, end of year $ 1,092 $ 8 $ 23 See accompanying notes to combined financial statements, including Note 11 for amounts of related party transactions. 47 VERSANT MEDIA GROUP, INC. COMBINED BALANCE SHEETS December 31, 2025 2024 (in millions) Assets Current Assets: Cash and cash equivalents $ 55 $ 8 Restricted cash 1,034 — Receivables, net 1,151 1,245 Assets held for sale 196 — Other current assets 66 65 Total current assets 2,502 1,318 Content costs 539 639 Investments 214 254 Property and equipment, net 423 143 Intangible assets, net 924 1,869 Goodwill 7,611 7,732 Other noncurrent assets, net 120 94 Total assets $ 12,333 $ 12,049 Liabilities and Equity Current Liabilities: Accounts payable $ 151 $ 102 Deferred revenue 163 135 Accrued content obligations 105 198 Accrued employee costs 62 43 Accrued expenses and other current liabilities 141 111 Total current liabilities 622 590 Deferred income taxes 191 428 Noncurrent content obligations 72 77 Long-term debt 983 — Other noncurrent liabilities 63 39 Commitments and contingencies Equity: Net Comcast investment 10,299 10,805 Accumulated other comprehensive loss ( 7 ) ( 8 ) Total Comcast equity 10,292 10,797 Noncontrolling interests 110 118 Total equity 10,402 10,915 Total liabilities and equity $ 12,333 $ 12,049 See accompanying notes to combined financial statements, including Note 11 for amounts of related party transactions. 48 VERSANT MEDIA GROUP, INC. COMBINED STATEMENTS OF CHANGES IN EQUITY December 31, 2025 2024 2023 (in millions) Net Comcast Investment Balance, beginning of year $ 10,805 $ 11,568 $ 12,373 Transactions with Comcast, net ( 1,436 ) ( 2,126 ) ( 2,344 ) Net income 930 1,363 1,539 Balance, end of year $ 10,299 $ 10,805 $ 11,568 Accumulated Other Comprehensive Income (Loss) Balance, beginning of year $ ( 8 ) $ ( 8 ) $ ( 9 ) Other comprehensive income (loss) 1 ( 1 ) 1 Balance, end of year $ ( 7 ) $ ( 8 ) $ ( 8 ) Noncontrolling Interests Balance, beginning of year $ 118 $ 117 $ 117 Other comprehensive income (loss) — — — Reduction of noncontrolling interests ( 9 ) — — Net income (loss) 1 2 — Balance, end of year $ 110 $ 118 $ 117 Total equity $ 10,402 $ 10,915 $ 11,677 See accompanying notes to combined financial statements, including Note 11 for amounts of related party transactions. 49 VERSANT MEDIA GROUP, INC. Notes to Combined Financial Statements Note 1. Description of the Company and Basis of Presentation Description of the Company Versant Media Group, Inc. (“Versant”, the “Company”, “we”, “us”, “our”) is a media and entertainment business that operates in four core markets: political news and opinion, business news and personal finance, golf and athletics participation and sports and genre entertainment. We serve these markets primarily through a portfolio of brands comprised of networks, including USA Network, CNBC, MS NOW, Oxygen, E!, Syfy and Golf Channel, and digital platforms, including Fandango, Rotten Tomatoes, GolfNow and SportsEngine. On January 2, 2026, the separation (the “Separation”) of Versant from Comcast Corporation (“Comcast”) was completed. In connection with the completion of the Separation, the assets related to certain of Comcast’s cable television networks and digital platforms were contributed to, and the related liabilities were assumed by Versant in accordance with the separation and distribution agreement and other agreements entered into in connection with the Separation, as further described in Note 13. On January 5, 2026, our common stock began trading on The Nasdaq Stock Market LLC (“Nasdaq”) under the ticker symbol “VSNT”. Basis of Presentation For the periods presented in these combined financial statements, the Versant businesses were operated as part of Comcast’s Media segment. The combined financial statements have been derived from Comcast’s historical accounting records as if Versant operations had been conducted independently from Comcast, and reflect the assets, liabilities, revenues and expenses of the Company on a historical cost basis. The combined financial statements were prepared on a standalone basis in accordance with U.S. generally accepted accounting principles (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). The combined balance sheets include assets and liabilities specifically attributable to the Company and certain assets and liabilities held by Comcast but specifically identifiable or otherwise attributable to our business. Assets and liabilities included in our combined balance sheets were based on an initial assessment as of December 31, 2024, and updated as necessary for new assets and liabilities resulting from transactions occurring subsequent to December 31, 2024, that were specifically identifiable or otherwise attributable to our business or in subsidiaries that are included in the combined financial statements. Accordingly, our combined balance sheets may not reflect the assets and liabilities of Versant following the Separation. Other than debt issued by Versant in 2025 (see Note 8), Comcast’s historical third-party debt and related interest expense have not been attributed to the Company because the borrowings are not specifically identifiable to the Company and the Company is not the legal obligor. The combined financial statements reflect noncontrolling interests for certain subsidiaries included in the combined financial statements, in which a third party has a minority ownership interest. The combined statements of income include all revenues and costs directly attributable to our business, including costs related to production activities that used centralized Comcast operations and directly charged to us based on usage. The combined statements of income also include allocations of costs for administrative functions and services performed on our behalf by other centralized functions within Comcast and allocations of costs for the use of shared assets (see Note 11). These expenses have been allocated on a pro rata basis using an applicable measure of revenue. All allocations and estimates reflected in the combined financial statements are based on assumptions that management believes are reasonable. However, the allocations may not be indicative of the actual expense that would have been incurred had we operated as an independent, standalone entity, nor are they indicative of our future expenses. Actual costs that may have been incurred if we had been a standalone company would depend on a number of factors, including the chosen organization structure and strategic decisions made in various areas, including information technology, infrastructure and outsourcing of corporate functions. All intercompany transactions and balances within our business have been eliminated. Certain transactions were handled through Comcast’s centralized cash management process or allocated to us and were generally deemed settled for cash at the time the transactions are recorded in these combined financial statements. The total net effect of the deemed settlement of these transactions is included in net Comcast investment and the net effect of changes in net Comcast investment is presented in financing activities in the combined statements of cash flows Centralized cash management balances related to certain of our operations were executed through formal loan agreements and 50 are therefore presented in assets or liabilities, as applicable. These and other transactions between the Company and Comcast are included in the combined financial statements and are considered related party transactions. See Note 11 for more information. Note 2. Summary of Significant Accounting Policies Our combined financial statements are prepared in accordance with GAAP, which require us to select accounting policies, including in certain cases industry-specific policies, and make estimates that affect the reported amount of assets, liabilities, revenue and expenses, and the related disclosure of contingent assets and contingent liabilities. Actual results could differ from these estimates. Accounting policies related to the capitalization and amortization of film and television costs are specific to the industries in which we operate and are discussed in Note 4. Information on other accounting policies and methods that we use in the preparation of our combined financial statements are included, where applicable, in their respective footnotes that follow. Below is a discussion of accounting policies and methods used in our combined financial statements that are not presented within other footnotes. Cash, Cash Equivalents and Restricted Cash We have historically participated in Comcast’s centralized approach to cash management and financing of its operations. Our cash was generally collected by Comcast daily, and Comcast funds our operating and investing activities as needed. Accordingly, our cash and cash equivalents represent directly attributed balances and do not include an allocation of Comcast cash and cash equivalents for any of the periods presented. Cash equivalents consist of highly liquid investments with original maturities of three months or less when purchased. The carrying amounts of our cash equivalents approximate their fair values, which are primarily based on Level 1 inputs. Restricted cash at December 31, 2025 included proceeds from the senior notes offering held in escrow until the consummation of the Separation on January 2, 2026 (see Note 8 for additional information). Advertising Expenses Advertising costs are expensed as incurred and totaled $ 109 million, $ 82 million and $ 105 million in 2025, 2024 and 2023, respectively, included in selling, general and administrative expenses. Share-Based Compensation Our share-based compensation plans consist primarily of awards of Comcast restricted stock units (“RSUs”) to certain employees as part of our long-term incentive compensation structure. Awards generally vest over a period of three to five years . The cost associated with our share-based compensation is based on an award’s estimated fair value at the date of grant and is recognized over the period in which any related services are provided. RSUs are primarily valued based on the closing price of Comcast’s common stock on the date of grant and are discounted for the lack of dividends, if any, during the vesting period. Share-based compensation expense for shared employees is included in allocated costs. Share-based compensation expense directly attributable to Versant was not material for the periods presented. Fair Value Measurements The accounting guidance related to fair value measurements establishes a hierarchy based on the types of inputs used for the various valuation techniques. The levels of the hierarchy are described below: Level 1: Values are determined using quoted market prices for identical financial instruments in an active market. Level 2: Values are determined using quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. 51 Level 3: Values are determined using models that use significant inputs that are primarily unobservable, discounted cash flow methodologies or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. We use this three-tier fair value hierarchy to measure the fair value of certain financial instruments on a recurring basis, such as for investments (see Note 5), on a non-recurring basis, such as for impairment testing (see Note 7) and for disclosure purposes, such as for debt (see Note 8). Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation and classification within the fair value hierarchy. Foreign Currency We translate assets and liabilities of our foreign operations where the functional currency is the local currency into U.S. dollars at the exchange rate as of the balance sheet date and translate revenue and expenses using average periodic exchange rates. The related translation adjustments are recorded as a component of accumulated other comprehensive income (loss) in our combined balance sheets. Other comprehensive income activity and balances were entirely attributed currency translation adjustments for the periods included in these combined financial statements. Any foreign currency transaction gains or losses are included in our combined statements of income in investment and other income (loss), net. For disclosures containing future amounts where the functional currency is the local currency, we translate the amounts into U.S. dollars at the exchange rates as of the balance sheet date. Net Comcast Investment Equity in the combined balance sheets represents Comcast’s net investment in our business and is presented as net Comcast investment in lieu of stockholders’ equity. The combined statement of changes in equity includes net cash transfers and other property transfers between us and Comcast, as well as intercompany receivables and payables between us and other Comcast affiliates that were settled on a current basis within transactions with Comcast, net. Additionally, net Comcast investment is impacted by assets and liabilities that have historically been held at the Comcast level but are specifically identifiable or otherwise attributable to us, and other assets and liabilities recorded by Comcast, whose related income and expenses have been pushed down to us. All transactions reflected in net Comcast investment in the combined balance sheet have been considered cash receipts and payments within financing activities in the combined statements of cash flows. See Note 11 for more information. Earnings per share data has not been presented in the combined financial statements because we did not operate as a separate legal entity with its own capital structure during any of the periods presented. Segments We present our operations in one reportable business segment and beginning in 2025, our Chief Executive Officer was the chief operating decision maker (“CODM”) . Our business operates complementary brands, generating revenue through contracts or monetization strategies that span across brands, and leveraging integrated operational infrastructure. As a single segment entity, our segment performance measure used in the measurement of operational strength and performance and in the evaluation of underlying trends is net income attributable to Versant and the measure of segment assets is total assets. Additional information about our operations and these measures is presented in the combined financial statements, with further details included throughout the footnotes, including a description of our products and services in Note 3 and certain of our significant operating expenses in Note 4. Recent Accounting Pronouncements Income Tax Disclosures In December 2023, the Financial Accounting Standards Board (“FASB”) issued updated accounting guidance related to income tax disclosures. The updated guidance, among other things, required additional disclosures relating to the income tax rate reconciliation and income taxes paid. We have adopted the updated guidance in this Annual Report on Form 10-K for the year ended December 31, 2025 with comparative periods updated to reflect the additional disclosures (see Note 9). 52 Disaggregation of Income Statement Expenses In November 2024, the FASB issued updated accounting guidance related to disclosures of certain costs and expenses. The updated accounting guidance, among other things, requires quantitative disclosures for employee compensation, selling expenses and purchases of inventory. The updated guidance is effective beginning with our Annual Report on Form 10-K for the year ended December 31, 2027. Internal-Use Software In September 2025, the FASB issued updated accounting guidance related to internal-use software. The updated guidance eliminates references to software project stages and clarifies that capitalization of internal-use software costs should begin once management authorizes and commits to funding a software project and it is probable that the project will be completed and used as intended. The updated guidance is effective for us as of January 1, 2028, with early adoption permitted. We are in the process of evaluating the impact of this accounting guidance on our financial statements. Interim Reporting In December 2025, the FASB issued updated accounting guidance on interim reporting. The updated guidance establishes a principle requiring entities to disclose events occurring after the end of the most recent annual reporting period that have a material impact on the entity, as well as clarifies the applicability of interim disclosure requirements. The guidance does not change the fundamental nature of interim reporting or expand or reduce current interim disclosure requirements. The guidance is effective for us beginning in interim periods after January 1, 2028, with early adoption permitted. We are in the process of determining the impact of this accounting guidance on our financial statements. Government Grants In December 2025, the FASB issued new accounting guidance on the recognition, measurement and presentation of government grants received by business entities. The new guidance defines government grants, clarifies their scope and provides a recognition threshold under which a grant is recognized when it is probable the entity will comply with the grant’s conditions and that the grant will be received. The updated guidance is effective for us as of January 1, 2029, and early adoption is permitted. We are in the process of determining the impact of this accounting guidance on our financial statements. Note 3. Revenue Year ended December 31, 2025 2024 2023 (in millions) Linear distribution $ 4,092 $ 4,325 $ 4,632 Advertising 1,577 1,731 1,865 Platforms 826 795 734 Content licensing and other 193 211 213 Total revenue $ 6,688 $ 7,062 $ 7,445 Linear distribution We generate revenue from the distribution of television programming in the United States and in certain international markets to traditional multichannel video providers and to virtual multichannel video providers that offer streamed linear television networks. 53 Monthly fees received under distribution agreements with multichannel video providers are generally under multiyear agreements with revenue based on the number of subscribers receiving our television networks through the provider and a per subscriber fee. Payment terms and conditions vary by contract type, although terms generally include payment within 60 days. These arrangements are accounted for as licenses of functional intellectual property and revenue is recognized as programming is provided. Advertising We generate revenue from the sale of advertising on our linear television networks and digital platforms. We have determined that a contract exists for our advertising sales once all terms and conditions are agreed upon, typically when the number of advertising units is specifically identified and scheduled. Advertisements are generally aired or delivered within one year once all terms and conditions are agreed upon. Revenue is recognized, net of agency commissions, in the period in which advertisements are aired or delivered and payment occurs thereafter, with payment generally required within 30 days. In some instances, we guarantee audience ratings for the advertisements. To the extent there is a shortfall in contracts where the ratings were guaranteed, a portion of the revenue is deferred until the shortfall is settled, typically by providing additional advertising units generally within one year of the original airing. The amount of future revenue to be earned related to fixed price contracts with advertisers in excess of one year totaled $ 234 million as of December 31, 2025, which will be recognized over the next 5 years. Platforms We generate revenue from services provided through our digital platforms. Our platforms facilitate consumer transactions, including tee time reservations at golf courses, the purchase of movie tickets, the rental or purchase of television and movie titles for streaming and registration with youth sports leagues. We also sell technology and related services to golf courses, movie theaters and youth sports organizations that leverage our platform, and also offer consumer subscription services, which provide access to streaming content. We generally have concluded that we are an agent for the underlying consumer transactions on our platforms, and we therefore do not recognize the direct revenue from the sale of the golf rounds, movie tickets, television or movie titles rentals or purchases, or sports registrations. End-consumers using our movie ticket and tee time platforms pay transaction-based fees. These fees are generally charged to customer credit cards and revenue is recognized at the time of the transaction based on the fee charged. We offer gift cards that customers may use for certain of our consumer services, primarily related to our movie ticket platform. We record a liability for estimated future gift card redemptions. We estimate the portion of these gift cards that will not be redeemed over time (“breakage”) based on historical redemption patterns. As of December 31, 2025 and 2024, the gift card liability for our movie ticket platform was $ 51 million and $ 53 million, respectively, including $ 36 million and $ 37 million in accrued expenses and other current liabilities, respectively, with the remainder presented in other noncurrent liabilities. Revenue recorded related to breakage on these gift cards was $ 12 million for the year ended December 31, 2025 and $ 15 million for each of the years ended December 31, 2024 and 2023. Our technology solutions provide customers access to our cloud-based applications. Contracts for these and our agency services generally have terms ranging from one year to three years with consideration due over the contract term taking multiple forms, including variable amounts tied to the value of specified tee times, which we generally receive directly from the end consumer, a percentage of amounts charged for specified transactions or fixed amounts paid by the customer. We recognize revenue for technology solutions and agency services as the services are provided over the contract term based on our share of the underlying transactions or on a straight-line basis for fixed fee contracts. 54 We offer additional services to customers receiving our technology services including payment processing and other services related to customer operations. Payment processing fees are based on a percentage of each transaction processed and are recognized as transactions occur. Consideration for other services may be a fixed fee or based on variable amounts and are recognized as services are provided over the contract period. Revenue from customers that purchase multiple services is allocated between the separate services based on the respective standalone selling prices. Subscription services are generally offered based on fixed amounts with monthly or annual terms. Subscription fees for the term are generally fixed and nonrefundable, and we recognize revenue over the term of the agreement. Content Licensing We generate revenue from the licensing of our owned content to television networks and direct-to-consumer streaming service providers, as well as through video on demand services provided by multichannel video providers and other service providers. These agreements generally include fixed pricing and span multiple years. We recognize revenue when the content is delivered and available for use by the licensee. When the term of an existing agreement is renewed or extended, we recognize revenue when the licensed content becomes available under the renewal or extension. Payment terms and conditions vary by contract type, although payments are generally collected over the license term. The amount of future revenue to be earned related to fixed pricing under existing third-party agreements is $ 88 million, which will be recognized within one year . Combined Balance Sheets December 31, 2025 2024 (in millions) Receivables, gross $ 1,161 $ 1,253 Less: Allowance for credit losses 10 8 Receivables, net $ 1,151 $ 1,245 Changes in Allowance for Credit Losses 2025 2024 2023 (in millions) Beginning balance $ 8 $ 18 $ 18 Current-period provision for expected credit losses ( 1 ) 1 — Write-offs charged against the allowance, net of recoveries and other 3 ( 10 ) — Ending balance $ 10 $ 8 $ 18 Customer Concentration Our most significant accounts receivable balances relate to our linear distribution agreements with large multichannel video providers. As of December 31, 2025 and 2024, our ten largest multichannel video provider customers accounted for approximately 56 % and 55 % of our total accounts receivable, respectively. For each of the periods presented, revenues from arrangements with Comcast totaled between 10 % and 11 % of our total revenue. Refer to Note 11 for revenue and accounts receivable information related to distribution and other arrangements with Comcast. In addition, for the year ended December 2025, revenue from one other customer represented 11 % of our total revenue. 55 Note 4. Costs of Revenue Year ended December 31, 2025 2024 2023 (in millions) Programming and production $ 2,446 $ 2,606 $ 2,724 Other 491 458 430 Total costs of revenue $ 2,937 $ 3,064 $ 3,154 Programming and Production Costs Year ended December 31, 2025 2024 2023 (in millions) Licensed, including sports rights $ 1,531 $ 1,716 $ 1,695 Owned 915 890 1,029 Total programming and production costs $ 2,446 $ 2,606 $ 2,724 We incur costs related to the license of the rights to use content owned by third parties and sports rights on our television networks and digital platforms, and related to the production and acquisition of owned content, which are described as licensed and owned content, respectively. Programming and production costs are presented in costs of revenue in our combined statements of income and the related capitalized amounts are presented in content costs in our combined balance sheets. We have determined that the predominant monetization strategy for the substantial majority of our content is on a group basis. In 2025 and 2024, we recorded reductions of programming and production costs related to production tax incentives of $ 10 million and $ 58 million, respectively, along with corresponding noncurrent receivables . Capitalized Content Costs December 31, 2025 2024 (in millions) Licensed, including sports advances $ 436 $ 519 Owned: In production and in development 30 31 Released, less amortization 73 89 103 120 Content costs $ 539 $ 639 The table below summarizes estimated future amortization expense for the next three years for capitalized content costs recorded in our combined balance sheets as of December 31, 2025. Licensed Owned (in millions) 2026 $ 171 $ 47 2027 $ 109 $ 19 2028 $ 76 $ 5 We have future minimum commitments for licensed content that are not recognized in our combined balance sheets as of December 31, 2025 totaling $ 110 million. 56 Capitalization and Recognition of Content Costs We capitalize the costs of licensed content when the license period begins, the content is made available for use and the costs of the licenses are known. Licensed content is amortized as the associated programs are used, incorporating estimated viewing patterns. We capitalize costs for owned content, including direct costs, production overhead, print costs, development costs and interest, as well as acquired titles. Amortization for content predominantly monetized with other owned or licensed content is recorded based on estimated usage. Amortization for owned content predominantly monetized on an individual basis and accrued costs associated with participations and residuals payments are recorded using the individual film forecast computation method, which recognizes the costs in the same ratio as the associated ultimate revenue. Estimates of ultimate revenue and total costs are based on anticipated airing patterns and distribution strategies, public acceptance and historical results for similar productions. We do not capitalize costs associated with marketing and distribution. Licensed and owned content are presented as noncurrent assets in content costs. We present amortization of licensed and owned content and accrued costs associated with participations and residuals payments in programming and production costs. Production activities may be eligible for tax incentives from certain state, local or foreign jurisdictions. These incentives generally provide for transferable or redeemable tax credits upon meeting established levels of qualified production spending within a participating jurisdiction. We record a receivable for a production tax incentive program when there is a reasonable assurance of collection with a corresponding reduction of capitalized content costs or programming and production costs, as applicable. When an event or a change in circumstance occurs that was known or knowable as of the balance sheet date and that indicates the fair value of either licensed or owned content is less than the unamortized costs in the balance sheet, we determine the fair value and record an impairment charge to the extent the unamortized costs exceed the fair value. Licensed and owned content is assessed in identified film groups, which are generally on a channel, network or platform basis, for content predominantly monetized with other content. Licensed content that is not part of a film group is also generally assessed in packages or channels. Owned content that is not part of a film group is assessed individually. Estimated fair values of licensed and owned content are generally based on Level 3 inputs including analysis of market participant estimates of future cash flows. We record charges related to impairments or content that is substantively abandoned to programming and production costs. Sports Rights We recognize the costs of multiyear, live-event sports rights as the rights are used over the contract term based on estimated relative value. Estimated relative value is generally based on the terms of the contract and the nature of and potential revenue generation of the deliverables within the contract. Sports rights are accounted for as executory contracts and are not subject to impairment. When cash payments, including advanc ed payments, exceed the relative value of the sports rights delivered, we recognize an asset in licensed content costs. Production costs incurred in advance of airing are also presented in licensed content costs. Other Costs of Revenue Other costs attributed to our service offerings primarily include transaction-based fees to support our payment processing services and integrate the third-party data into our digital platforms, as well as direct personnel and operating costs to maintain the platforms. These costs are generally expensed as incurred. Note 5. Investments Our investments are accounted for as nonmarketable equity securities. During the year ended December 31, 2025, we recorded an unrealized impairment loss of $ 40 million for one of our investments. The estimated fair value of $ 94 million was determined based on an analysis that leveraged multiples of earnings from comparable public companies, which are Level 2 inputs. The cumulative amount of downward adjustments to our nonmarketable equity securities totaled $ 102 million for investments that continue to be held as of December 31, 2025. 57 We classify investments without readily determinable fair values that are not accounted for under the equity method as nonmarketable equity securities. The accounting guidance requires nonmarketable equity securities to be recorded at cost and adjusted to fair value at each reporting period. However, the guidance allows for a measurement alternative, which is to record the investments at cost, less impairment, if any, and subsequently adjust for observable price changes of identical or similar investments of the same issuer. We generally apply the measurement alternative, adjusting the investments for observable price changes of identical or similar investments of the same issuer, to our nonmarketable equity securities. When an observable event occurs, we estimate the fair values of our nonmarketable equity securities primarily based on Level 2 inputs that are derived from observable price changes of similar securities adjusted for insignificant differences in rights and obligations. We review our nonmarketable equity securities, each reporting period to determine whether there are identified events or circumstances that would indicate there is a decline in the fair value. For our nonpublic investments, if there are no identified events or circumstances that would have a significant adverse effect on the fair value of the investment, then the fair value is not estimated. We record the changes in value from observable events and impairments to investment and other income (loss), net. Note 6. Property and Equipment Original Useful Lives as of December 31, 2025 December 31, 2025 2024 (in millions) Machinery, equipment and technology 3 - 8 years $ 747 $ 471 Buildings and leasehold improvements 4 - 40 years 224 43 Construction in process N/A 55 33 Land N/A 12 — Property and equipment, at cost 1,038 548 Less: Accumulated depreciation ( 615 ) ( 404 ) Property and equipment, net $ 423 $ 143 Depreciation expense relating to property and equipment was $ 67 million, $ 63 million and $ 67 million for the years ended December 31, 2025, 2024 and 2023, respectively. Property and equipment are stated at cost. We capitalize improvements that extend asset lives and expense repairs and maintenance costs as incurred. We capitalize direct development costs associated with internal-use software, including external direct costs of material and services and payroll costs for employees devoting time to these software projects, as well as costs associated with arrangements for purchase or license of internal-use software. We expense maintenance and training costs, as well as costs incurred during the preliminary stage of a software development project, as they are incurred. We record depreciation using the straight-line method over the asset’s estimated useful life. For assets that are sold or retired, we remove the applicable cost and accumulated depreciation and, unless the gain or loss on disposition is presented separately, we recognize it as a component of depreciation expense. We evaluate the recoverability of our property and equipment whenever events or substantive changes in circumstances indicate that the carrying amount may not be recoverable. The evaluation is based on the cash flows generated by the underlying asset groups, including estimated future operating results, trends or other determinants of fair value. If the total of the expected future undiscounted cash flows were less than the carrying amount of the asset group, we would recognize an impairment charge to the extent the carrying amount of the asset group exceeded its estimated fair value. Unless presented separately, the impairment charge is included as a component of depreciation expense. 58 Note 7. Goodwill and Intangible Assets Goodwill The changes in the carrying value of our goodwill were as follows: Year Ended December 31, 2025 December 31, 2024 (in millions) Opening balance $ 7,732 $ 7,732 Acquisition 28 — Assets held for sale ( 149 ) — Ending balance $ 7,611 $ 7,732 Goodwill is calculated as the excess of the consideration transferred over the identifiable net assets acquired in a business combination and represents the future economic benefits expected to arise from anticipated synergies and intangible assets acquired that do not qualify for separate recognition, including increased footprint, assembled workforce, noncontractual relationships and other agreements. As the Versant businesses were operated as a part of Comcast’s Media segment, our combined balance sheets include an allocated amount of goodwill from Comcast’s Media segment, determined using a relative fair value analysis as of July 1, 2024, the date of Comcast’s most recent annual goodwill impairment assessment. The fair values utilized in the relative fair value analysis were estimated using a discounted cash flow analysis, using Level 3 inputs. When performing this analysis, we also considered multiples of earnings from comparable public companies and recent market transactions. Prior to this date, impairment analysis was performed at the Comcast level. Following the allocation, goodwill is required to be assessed for recoverability annually, or more frequently whenever events or substantive changes in circumstances indicate that the carrying amount of a reporting unit may exceed its fair value. We test goodwill for impairment at the reporting unit level. To determine our reporting units, we evaluate the components one level below the segment level and we aggregate the components if they have similar economic characteristics. We evaluate the determination of our reporting units used to test for impairment periodically or whenever events or substantive changes in circumstances occur. The assessment of recoverability may first consider qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. A quantitative assessment is performed if the qualitative assessment results in a more-likely-than-not determination or if a qualitative assessment is not performed. The quantitative assessment considers whether the carrying amount of a reporting unit exceeds its fair value, in which case an impairment charge is recorded to the extent the reporting unit’s carrying value exceeds its fair value. Unless presented separately, the impairment charge is included as a component of amortization expense. Intangible Assets December 31, 2025 2024 Weighted-Average Remaining Useful Life as of December 31, 2025 Gross Carrying Amount (1) Accumulated Amortization Gross Carrying Amount Accumulated Amortization (in millions) Finite-Lived Intangible Assets: Customer relationships 1 year $ 9,043 $ ( 8,238 ) $ 9,033 $ ( 7,477 ) Tradenames and other 1 year 729 ( 610 ) 954 ( 642 ) Total $ 9,772 $ ( 8,848 ) $ 9,987 $ ( 8,118 ) 59 Amortization expense for intangible assets subject to amortization was $ 943 million, $ 926 million, and $ 924 million for the years ended December 31, 2025, 2024 and 2023, respectively. Amortization expense for the year ended December 31, 2025 includes accelerated amortization of the MSNBC trade name as a result of the rebranding of the network. Finite-lived intangible assets are subject to amortization and consist primarily of customer relationships and trade names acquired in business combinations. Our finite-lived intangible assets are amortized primarily on a straight-line basis over their estimated useful life or the term of the associated agreement. The table below presents the estimated amortization expense of our intangible assets. (in millions) 2026 $ 884 2027 $ 9 2028 $ 6 2029 $ 6 2030 $ 6 Thereafter $ 13 We evaluate the recoverability of our finite-lived intangible assets whenever events or substantive changes in circumstances indicate that the carrying amount may not be recoverable. The evaluation is based on the cash flows generated by the underlying asset groups, including estimated future operating results, trends or other determinants of fair value. If the total of the expected future undiscounted cash flows were less than the carrying amount of the asset group, we would recognize an impairment charge to the extent the carrying amount of the asset group exceeded its estimated fair value. Unless presented separately, the impairment charge is included as a component of amortization expense. Note 8. Debt Obligations Senior Secured Notes In October 2025, we completed a private offering pursuant to which we issued $ 1.0 billion in aggregate principal amount of 7.250 % senior secured notes due January 2031 (the “Senior Notes”). Interest on the Senior Notes will be paid semi-annually, on January 30 and July 30 of each year, commencing on July 30, 2026. The proceeds from the Senior Notes were initially placed into an escrow account due to a special mandatory redemption provision that would have required the Senior Notes to be redeemed if the Separation of Versant from Comcast had not been consummated by March 2, 2026, and were released on January 2, 2026 in connection with the consummation of the Separation. The balance in the escrow account was presented as restricted cash and cash equivalents in our combined balance sheet as of December 31, 2025. The Senior Notes are senior in right of payment and are jointly and unconditionally guaranteed on a senior secured basis by each of our subsidiaries that is a guarantor under the Senior Credit Facilities (as defined below) and are secured, subject to permitted liens and certain other exceptions, by perfected first-priority security interests in substantially all of our and each guarantor’s tangible and intangible assets and property, now owned or hereafter acquired, subject to certain customary exceptions. At any time prior to January 30, 2028, we may, at our option, redeem the Senior Notes, in whole or in part, at a price equal to 100 % of the principal amount thereof, plus accrued and unpaid interest, if any, plus the applicable “make-whole” premium set forth in the indenture that governs the Senior Notes. At any time prior to January 30, 2028, we may redeem up to 10 % of the principal amount of the Senior Notes during any twelve-month period at a redemption price equal to 103 % of the principal amount thereof, plus accrued and unpaid interest, if any. We may, at our option, also redeem up to 40 % of the principal amount of the Senior Notes at any time prior to January 30, 2028 in an amount equal to the net proceeds from certain equity offerings at the redemption price equal to 107.250 % of the principal amount thereof plus accrued and unpaid interest, if any. We may redeem the Senior Notes, in whole or in 60 part, at any time on or after January 30, 2028 at the redemption prices set forth in the indenture. The Senior Notes contain customary events of default, as well as customary negative covenants that include, among other things, and subject to certain qualifications and exceptions, covenants that restrict our ability and the ability of certain of our subsidiaries to: incur or guarantee additional indebtedness; create or permit liens on assets; pay dividends on capital stock or redeem, repurchase or retire capital stock or subordinated indebtedness; make certain investments and other restricted payments; engage in mergers, acquisitions, consolidations and amalgamations; transfer and sell certain assets; and engage in transactions with affiliates. At December 31, 2025, the carrying value of the Senior Notes was $ 983 million, and the estimated fair value was approximately $ 1.03 billion, which is based Level 2 inputs using external market data available for debt with similar terms and maturities. Term Loans and Revolving Credit Facility In October 2025, we entered into a credit agreement providing for a term loan of $ 1.0 billion due January 2031 (the “Term Loan A”) and a revolving credit facility of $ 750 million due January 2031 (the “Revolving Credit Facility”). The proceeds of the Term Loan A were funded on January 2, 2026 in connection with the consummation of the Separation and the Revolving Credit Facility remains undrawn. In addition, on January 2, 2026, we entered into an additional credit agreement providing for a term loan of $ 1.0 billion due January 2031 (the “Term Loan B” and together with Term Loan A, the “Term Loans”), with the proceeds of the Term Loan B funded on January 2, 2026. The Term Loans and the Revolving Credit Facility (the “Senior Credit Facilities”) are secured by substantially all the assets of the Company and its material, wholly-owned U.S. subsidiaries, subject to certain exceptions. The Term Loans are denominated in U.S. dollars, and borrowings under the Revolving Credit Facility may be made available in U.S. Dollars, Euros, Pounds Sterling and Canadian Dollars. Borrowings under the Term Loan A and the Revolving Credit Facility in U.S. Dollars bear interest at a rate per annum equal to, at our option, either (a) a term SOFR-based rate, subject to a floor of 0.00 % per annum, or (b) a U.S. Dollar base rate, subject to a floor of 1.00 % per annum, in each case plus an applicable margin. The applicable interest rate margins for borrowings under the Term Loan A and the Revolving Credit Facility in U.S. Dollars are initially (a) 0.75 % per annum in the case of U.S. Dollar base rate borrowings and (b) 1.75 % per annum in the case of SOFR borrowings. In addition, we are required to pay commitment fees of 0.25 % per annum on the unutilized commitments under the Revolving Credit Facility, payable quarterly in arrears. The interest rate margins and the commitments fees may be subject to step downs based on our consolidated first lien net leverage ratio, as defined in the credit agreement governing the Term Loan A and the Revolving Credit Facility. Borrowings under the Term Loan B bear interest at a rate per annum equal to, at our option, either a term SOFR-based rate or a U.S. Dollar base rate, in each case plus an applicable margin of (a) 2.50 % per annum in the case of U.S. Dollar base rate borrowings and (b) 3.50 % per annum in the case of SOFR borrowings, subject to a SOFR-based rate floor of 0.00 % per annum and U.S. Dollar base rate floor of 1.00 % per annum. The amortization rate for the Term Loan A is 5.00 % per annum, payable in quarterly installments beginning on September 30, 2026, with the balance being payable at maturity. The amortization rate for the Term B Loan Facility is 7.00 % per annum, payable in quarterly installments beginning on September 30, 2026, with the balance being payable at maturity. The credit agreements governing the Senior Credit Facilities also require mandatory prepayments of the Term Loans under certain circumstances and subject to customary exceptions and baskets set forth in the respective credit agreements, following certain asset sales and debt incurrences. The Term Loan B credit agreement also requires prepayment based on a percentage of excess cash flows as defined in such credit agreement and subject to customary exceptions and baskets set forth therein. 61 We are permitted to voluntarily reduce unutilized portion of the Revolving Credit Facility and repay outstanding loans under the Term Loan A and the Revolving Credit Facility at any time without prepayment premium or penalty. We may voluntarily repay outstanding loans under Term Loan B at any time, subject to the payment of a customary make-whole premium set forth in the Term Loan B credit agreement, if such prepayment occurs prior to the first anniversary of the closing date, subject to a prepayment premium of 1 % if such prepayment occurs on or after the first anniversary of the closing date and before the second anniversary of the closing date, and at par if such prepayment occurs on or after the second anniversary of the closing date. The credit agreements for the Senior Credit Facilities contains certain customary negative and affirmative covenants and events of default. Negative covenants restrict, among other things, subject to certain qualifications and exceptions, our ability and the ability of certain of our subsidiaries to: incur additional indebtedness; create liens; enter into agreements and other arrangements that include negative pledge clauses; pay dividends on capital stock or redeem, repurchase or retire capital stock or subordinated indebtedness; make investments, loans, advances and acquisitions; merge, amalgamate or sell assets; enter into sale and leaseback transactions; engage in transactions with affiliates; and enter into amendments of or waivers under subordinated indebtedness. If an event of default, as specified in the credit agreements, shall occur and be continuing, we may be required to repay all amounts outstanding thereunder. The Term A Loan Facility and the Revolving Credit Facility also contain a financial covenant that requires us to maintain a maximum consolidated first lien net leverage ratio, as defined in the credit agreement governing the Term Loan A and the Revolving Credit Facility, of not greater than 3.50 :1.00. Note 9. Income Taxes During the periods presented in these combined financial statements, our operations were included in the combined U.S. federal, state and foreign income tax returns filed by Comcast. Income tax expense and other income tax related information contained in the combined financial statements are calculated as if we were a separate corporation that filed separate income tax returns. We believe the assumptions underlying the calculation of income taxes on a separate return basis are reasonable. However, income tax expense and liabilities as presented in these combined financial statements do not necessarily reflect the results that we would have reported as an independent, standalone company for the periods presented. Income Before Income Taxes Year ended December 31, 2025 2024 2023 (in millions) Domestic $ 1,222 $ 1,823 $ 2,041 Foreign 6 20 28 $ 1,228 $ 1,843 $ 2,069 62 Components of Income Tax Expense Year ended December 31, 2025 2024 2023 (in millions) Current Expense (Benefit): Federal $ 334 $ 472 $ 508 State 102 143 150 Foreign — 7 6 436 623 665 Deferred Expense (Benefit): Federal ( 110 ) ( 111 ) ( 104 ) State ( 29 ) ( 33 ) ( 32 ) Foreign — ( 1 ) — ( 139 ) ( 145 ) ( 135 ) Income tax expense $ 297 $ 478 $ 530 Our income tax expense (benefit) differs from the federal statutory amount because of the effect of the items detailed in the table below. Year ended December 31, 2025 2024 2023 Amount % Amount % Amount % (in millions) Federal tax at statutory rate $ 258 21.0 % $ 387 21.0 % $ 435 21.0 % State income taxes, net of federal benefit (a) 57 4.7 % 86 4.7 % 97 4.7 % Changes in valuation allowance ( 23 ) ( 1.9 ) % — — % — — % Other 5 0.4 % 5 0.3 % ( 2 ) ( 0.1 ) % Effective tax rate $ 297 24.2 % $ 478 26.0 % $ 530 25.6 % (a) The majority of the tax effect in this category was attributable to state taxes in California, New York, Florida, Illinois, New Jersey, Pennsylvania, and Michigan for each of the years presented. We base our provision for income taxes on our current period income, changes in our deferred income tax assets and liabilities, income tax rates, changes in estimates of our uncertain tax positions, tax planning opportunities available in the jurisdictions in which we operate and excess tax benefits or deficiencies that arise when the tax consequences of share-based compensation differ from amounts previously recognized in the statements of income. Current income tax expense has been offset by a corresponding change in net Comcast investment on the combined balance sheet. We recognize deferred tax assets and liabilities when there are temporary differences between the financial reporting basis and tax basis of our assets and liabilities and for the expected benefits of using net operating loss carryforwards. The determination of the realization of the net operating loss carryforwards is dependent on our subsidiaries’ taxable income or loss, redetermination from taxing authorities, and laws that can change from year to year and impact the amount of such carryforwards. We recognize a valuation allowance if we determine it is more likely than not that some portion, or all, of a deferred tax asset will not be realized. When a change in the tax rate or tax law has an impact on deferred taxes, we apply the change based on the years in which the temporary differences are expected to reverse. We record the change in our combined financial statements in the period of enactment. 63 Federal Legislation On July 4, 2025, the U.S. H.R.1. legislation (“H.R.1.”) was enacted in the United States and provides, among other things, for immediate deduction of 100% of the costs of qualified property, including significant portions of our capital expenditures and film and television production costs, acquired and placed into service after January 19, 2025, compared to the 40% and 20% deductions that would have applied in 2025 and 2026, respectively, under prior law. H.R.1 also reinstates the immediate deduction of domestic research and development expenses, retroactive to 2022, repealing the prior requirement to capitalize and amortize such costs over five years. H.R.1 resulted in a reduction in our income tax obligation in net Comcast investment of approximately $ 15 million and a corresponding increase in our deferred tax liability. There is no material impact on our income tax expense or effective tax rate. Components of Net Deferred Tax Liability December 31, 2025 2024 (in millions) Deferred Tax Assets: Net operating loss and other loss carryforwards $ 4 $ 28 Investments 30 26 Nondeductible accruals and other 25 11 Less: Valuation allowance ( 12 ) ( 37 ) 47 27 Deferred Tax Liabilities: Property and equipment 66 15 Intangible assets 169 437 235 452 Net deferred tax liability $ 188 $ 425 Changes in our Valuation Allowance for Deferred Tax Assets 2025 2024 2023 (in millions) Beginning balance $ 37 $ 36 $ 36 Additions charged to income tax expense and other accounts 10 1 — Deductions from reserves ( 35 ) — — Ending balance $ 12 $ 37 $ 36 As of December 31, 2025 and 2024, net operating loss carryforwards primarily related to subsidiaries included in our combined financial statements, which can be carried forward indefinitely. At December 31, 2025 our valuation allowances primarily related to these net operating loss carryforwards and the impairment of certain investments. The reduction in our net operating loss carryforwards and valuation allowance in 2025 primarily resulted from a change in the tax status of one of our subsidiaries. Uncertain Tax Positions From time to time, we engage in transactions in which the tax consequences may be subject to uncertainty. In these cases, we evaluate our tax position using the recognition threshold and the measurement attribute in accordance with the accounting guidance related to uncertain tax positions. Examples of these transactions include the allocation of income among state and local tax jurisdictions. Significant judgment is required in assessing and estimating the tax consequences of these transactions. We determine whether it is more likely than not that a tax position will be sustained on examination, including the resolution of any related appeals or litigation processes, based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured 64 to determine the amount of benefit to be recognized in our combined financial statements. We classify interest and penalties, if any, associated with our uncertain tax positions as a component of income tax expense (benefit). Our liability for uncertain tax positions was not material in any period presented. The IRS has completed its examination of Comcast’s income tax returns for all years through 2022. Various states and foreign jurisdictions are examining Comcast’s tax returns and the tax years of those tax returns currently under examination vary by state, with most of the periods relating to tax years 2011 and forward. Note 10. Commitments and Contingencies Licensed Content Our most significant fixed-price purchase obligations relate to long-term commitments for licensed content. Refer to Note 4 for additional information. Contingencies We are subject to legal proceedings and claims that arise in the ordinary course of our business. While the amount of ultimate liability with respect to such proceedings and claims is not expected to materially affect our results of operations, cash flows or financial position, any such legal proceedings or claims could be time-consuming and injure our reputation. Note 11. Related Parties Transactions We enter into transactions with Comcast, of which prior to January 2, 2026, we were a wholly owned subsidiary, and its related parties in the ordinary course of our operations, including the license of content for use on our networks, the distribution of our television networks and purchases and sales of advertising. The nature of these services is similar to services that we purchase from or provide to third-parties. In addition, certain costs related to production activities that use centralized Comcast operations are directly charged to us based on usage. Sales to related parties were $ 928 million, $ 1.26 billion and $ 1.34 billion during the years ended December 31, 2025, 2024 and 2023, respectively. Accounts receivable due for these transactions were $ 123 million and $ 208 million as of December 31, 2025 and 2024, respectively. Costs of revenue from related parties were $ 973 million, $ 1.16 billion and $ 1.15 billion for the years ended December 31, 2025, 2024 and 2023, respectively. Capitalized content costs related to these costs were $ 302 million and $ 286 million as of December 31, 2025 and 2024, respectively. Content obligations related to these costs were $ 94 million and $ 112 million as of December 31, 2025 and 2024, respectively. Costs of advertising purchased from related parties were $ 8 million, $ 12 million and $ 14 million for the years ended December 31, 2025, 2024 and 2023, respectively, and are presented in selling, general and administrative expenses. Amounts payable for these transactions were not material as of December 31, 2025 or 2024. Prior to the third quarter 2025, we had related party loan balances associated with the participation of certain of our subsidiaries in Comcast’s centralized cash management programs. Our receivable balances pursuant to these contracts were presented in other current assets in the combined balance sheets and totaled $ 35 million as of December 31, 2024. Our payable balances pursuant to these contracts were presented in accrued expenses and other current liabilities in the combined balance sheets and totaled $ 12 million as of December 31, 2024. Activity related to loans receivable and payable is presented in the combined statements of cash flows in other investing and other financing activities, respectively. 65 Shared Services and Other Allocated Costs The combined financial statements include transactions involving shared services and assets (including expenses primarily related to personnel, advertising and marketing, facilities, information technology and network communications support and other overhead functions) and certain corporate administrative services (including charges for services such as accounting, tax, treasury and cash management, insurance, legal and risk management) that were provided to us by Comcast. These costs were generally allocated on a pro rata basis using an applicable measure of revenue applied to the relevant pool of costs (e.g., costs incurred at Comcast’s Media segment or corporate levels), including depreciation and amortization expense for shared assets. Allocated costs are included in costs of revenue and selling, general and administrative expenses in the combined statement of income and are reflected in the combined balance sheets and statements of cash flows as changes in net Comcast investment. These amounts represent management’s reasonable estimate of the costs incurred; however, they are not necessarily representative of the costs required for us to operate as an independent, publicly traded company. Amounts recorded in cost of revenue for these services were $ 264 million, $ 266 million and $ 277 million in 2025, 2024 and 2023, respectively. Amounts recorded in selling, general and administrative expenses for these services were $ 844 million, $ 870 million and $ 910 million in 2025, 2024 and 2023, respectively. Note 12. Additional Financial Information Supplemental Cash Flow Information Cash, cash equivalents and restricted cash and cash equivalents at December 31, 2025 of $ 1.09 billion includes cash and cash equivalents of $ 55 million, restricted cash of $ 1.03 billion, and cash presented within assets held for sale of $ 3 million. Non-cash investing activities for the year ended December 31, 2025 included approximately $ 168 million related to the contribution of a key operational hub located in Englewood Cliffs, New Jersey as part of a series of legal steps executed in October 2025 in anticipation of the Separation. Held for Sale During the fourth quarter of 2025, we initiated a process to sell SportsEngine and the related assets and liabilities were classified as held for sale in our combined balance sheet as of December 31, 2025. Upon classification as held for sale, this business was measured at the lower of its carrying amount or its estimated fair value less costs to sell. The assets held for sale are primarily comprised of goodwill of $ 149 million, property and equipment of $ 17 million and intangible assets of $ 14 million. Liabilities held for sale totaled $ 18 million and are presented in other current liabilities. We currently expect to complete the sale of SportsEngine during 2026. Transaction Costs Approximately $ 36 million of costs incurred by Comcast related to the Separation have been included in selling, general and administrative expenses in our combined statements of income for the year ended December 31, 2025. These costs include legal, consulting, advisory and audit fees that will directly benefit the Versant business as a standalone company, or for which the Versant business is the legal obligor. 66 Note 13. Subsequent Events The Separation and Financing Arrangements On January 2, 2026, we completed the Separation from Comcast through the distribution of 100 % of the shares of Versant Class A common stock and Versant Class B common stock to holders of Comcast Class A common stock and Comcast Class B common stock as of the close of business on the record date of December 16, 2025. Comcast’s shareholders of record received one share of Versant Class A common stock or Versant Class B common stock for every 25 shares of Comcast Class A common stock or Class B common stock, respectively, held as of the record date. Immediately after the Separation, holders of Comcast’s common stock prior to the Separation owned 100 % of our issued and outstanding shares. Prior to the Separation, the assets related to certain of Comcast’s cable television networks and digital platforms were contributed to, and the related liabilities were assumed, by Versant in accordance with certain agreements entered into in connection with the Separation. These agreements, among other things, effected the Separation and provide a framework for our relationship with Comcast after the Separation, including the separation and distribution agreement, the transition service agreement, the tax matters agreement and certain other agreements related to employee matters, intellectual property, and certain commercial arrangements. In connection with the Separation, we issued approximately $ 3.0 billion of total debt, including Senior Notes issued in October 2025 and borrowings under the Term Loans drawn upon the Separation. These borrowings are further described in Note 8. A portion of the proceeds from these borrowings was used to fund a cash payment to Comcast of $ 2.25 billion at the time of the Separation as consideration for assets that were contributed to us in connection with the Separation. The Company’s Articles of Incorporation were amended and restated following the Separation to provide the Company with the authority to issue up to 7.5 billion shares of $ 0.01 par value per share Class A common stock, up to 75 million shares of $ 0.01 par value per share of Class B common stock, and up to 20 million shares of preferred stock with no par value, Class A and Class B common stock have substantially identical rights, except with respect to voting rights. Holders of Class A common stock are entitled to one vote per share and holders of Class B common stock are entitled to 15 votes per share, and are entitled to any dividends when and as declared without regard to class. Holders of both stock classes vote together as a single class on all matters with respect to which a vote of the shareholders is required or permitted under applicable law, the Amended and Restated Articles of Incorporation, or the Bylaws of the Corporation, whereby Class B common stock in the aggregate are entitled to cast 33 1/3% of the votes, subject to reduction if the number of shares of Class B common stock outstanding is reduced. Each share of Class B common stock is convertible at the option of the holder into one share of Class A common stock. Share-based Compensation Plans In January 2026, in connection with the Separation, our Board of Directors adopted our Omnibus Equity Incentive Plan. A total of 19 million shares of the Company’s common stock have been reserved for issuance under the plan, subject to certain adjustments. The plan may be used to grant restricted stock and restricted stock unit awards, stock options and stock appreciation right awards. In connection with the Separation, 1.6 million RSUs, which were originally granted under Comcast’s equity plans, were converted into Versant RSUs for our employees in accordance with the employee matters agreement. In addition, on January 9, 2026, we granted approximately 500,000 RSUs to eligible employees vesting ratably over a three year service period and approximately 500,000 performance stock units to certain senior executives vesting after 3 years based on achievement of certain market conditions. 67 Dividends and Share Repurchase Authorization On March 3, 2026, our Board of Directors declared our first quarter dividend of $ 0.375 per share to be paid in April 2026. On March 3, 2026, our Board of Directors also authorized a share repurchase program under which the Company may purchase up to $ 1 billion of its outstanding shares of Class A common stock. The repurchase authorization does not obligate the Company to acquire any particular number of shares, and the program may be suspended, extended, modified or discontinued at any time. 68 Table of Contents Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.