What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-08-07 compared with 2026-05-08 · 186 added, 123 removed, 255 unchanged (55% of the section changed)

15 unchanged sentences

◦ Acquire or divest businesses on acceptable terms, execute on our investment strategies, successfully manage our growth, and integrate and realize anticipated synergies from acquisitions;

◦ Complete the planned divestiture of our Connectivity business on the anticipated terms and timing, or at all, including through the satisfaction or waiver of closing conditions, receipt of required regulatory approvals, and the absence of legal or other impediments to closing;

◦ Realize the anticipated benefits from the divestiture of our Connectivity business;

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was incorporated in 2014 as a Delaware corporation through the creation of a holding company structure.

Ziff Davis, Inc., together with its subsidiaries (“Ziff Davis”, “the Company”, “our”, “us” or “we”), is a vertically focused digital media and internet company whose portfolio includes leading brands in technology, shopping, gaming and entertainment, health and wellness, connectivity, cybersecurity, and martech.

Our business specializes in the technology, shopping, gaming and entertainment, healthcare, and connectivity markets, offering content, tools, and services to consumers and businesses and provides internet-delivered cloud-based services to consumers and businesses including cybersecurity, privacy, and marketing technology.

On March 2, 2026, the Company entered into a definitive agreement to sell its Connectivity business to Accenture Inc.

(“Accenture”) for $1.2 billion in cash.

The sale is expected to close in the next couple of months, subject to the receipt of customary regulatory approvals and satisfaction of other closing conditions.

The transaction is intended to support the Company’s ongoing efforts to maximize value for it’s shareholders.

Upon reclassification of Connectivity as discontinued operations, the Company determined that Connectivity is no longer a reportable segment.

The Company will continue to own and operate the Connectivity business in the ordinary course until the closing of the transaction.

Our business specializes in the technology, shopping, gaming and entertainment, and healthcare markets, offering content, tools, and services to consumers and businesses and provides internet-delivered cloud-based services to consumers and businesses including cybersecurity, privacy, and marketing technology.

On June 17, 2026, the Company completed the sale of its Connectivity business (“Connectivity”) to Accenture Inc.

for an aggregate purchase price of $1.2 billion in cash, subject to certain customary adjustments set forth in the purchase agreement.

During the first quarter of 2026, the Company determined that the Sale met the held-for-sale and discontinued operations accounting criteria.

The assets and liabilities of Connectivity have been classified as discontinued operations for all periods presented in accordance with ASC 205-20, Discontinued Operations as the disposition constitutes a strategic shift that will have a major effect on the Company’s operations and financial results.

Furthermore, upon reclassification of Connectivity as discontinued operations, the Company determined that Connectivity is no longer a reportable segment.

Refer to Note 5 - Divestitures in Item 1 of Part I of this Quarterly Report on Form 10-Q for further details.

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The terms of these contracts specify the price of the advertising to be sold and the volume of advertisements that will be served over the course of a campaign.

Additionally, we have contractual arrangements with certain third-party websites and applications not owned by us, and third-party advertising networks to deliver online display and video advertising to their

websites and applications or to third-party sites.

We generate leads for advertisers, including vendors of consumer health and wellness products, consumer packaged goods, and information technology services, through various marketing methods.

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Subscription and Licensing - We provide cloud-based subscription services and generate “fixed” subscription revenues for customer subscriptions and, to a lesser extent, “variable” usage revenues generated from actual usage by our subscribers.

We offer subscription and licensing services to businesses, which offer up-to-date insights into global fixed broadband and mobile performance data, and we offer subscription packages to consumers through the Lose It!

We offer subscription and licensing services to businesses, including subscription packages to consumers through the Lose It!

weight loss app and through Humble Bundle’s digital subscriptions and storefront for video games, ebooks, and software.

We also generate revenue from the sale of perpetual software licenses, related software support, and maintenance used in conjunction with software and other related services.

We license our proprietary technology, data, and intellectual property to third parties for various purposes.

Other - Other revenues primarily include those from online course revenues and revenues from a customer acquisition platform for subscription services companies.

We license our proprietary technology, and intellectual property to third parties for various purposes.

Other - Other revenues primarily include those from online courses and revenues from a customer acquisition platform for subscription services companies.

Revenues from external customers classified by revenue source are as follows (in thousands):

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2026 2025 2026 2025

Technology & Shopping

1 unchanged sentence

Subscription and licensing 3,593 2,626 6,389 4,804

Other 66 (648) 66 (612)

Total Technology & Shopping revenues $ 76,757 $ 80,776 $ 147,916 $ 162,466

2 unchanged sentences

Subscription and licensing 16,265 13,965 31,373 27,611

Other 1,187 10 1,187 19

Total Gaming & Entertainment revenues $ 46,619 $ 46,226 $ 87,383 $ 84,252

11 unchanged sentences

We use certain metrics to generally assess the operational and financial performance of our businesses.

These metrics are described in further detail below and are used by management in managing or monitoring the performance of each reportable segment when the respective revenues category is significant to the revenues of the reportable segment overall.

These metrics are described in further detail below and are used by management in managing or monitoring the performance of each reportable segment when the respective revenue category is significant to the revenues of the reportable segment overall.

For advertising and performance marketing revenues, these metrics are used for the Technology & Shopping, Gaming & Entertainment, and Health & Wellness reportable segments.

For subscription and licensing revenues, these metrics are used for the Gaming & Entertainment, Health & Wellness, and Cybersecurity & Martech reportable segments.

Since all revenues are not

reflected in these metrics, management does not use these metrics on a consolidated basis to evaluate performance, but rather uses them on a reportable segment basis as shown further below.

Since all revenues are not reflected in these metrics, management does not use these metrics on a consolidated basis to evaluate performance, but rather uses them on a reportable segment basis as shown further below.

Advertising and Performance Marketing - For our advertising and performance marketing revenues, management has identified net advertising and performance marketing revenue retention, the number of customers, and quarterly revenue per customer as relevant to investors’ and others’ assessment of our financial condition and results of operations.

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Similarly, we monitor the number of our customers and the revenue per customer, as defined below, as these metrics provide further details related to our reported revenue and contribute to certain of our business planning decisions.

The following table sets forth certain key operating metrics for the advertising and performance marketing revenues based on the reportable segment for the three months ended March 31, 2026 and 2025.

Three months ended March 31,

The following table sets forth certain key operating metrics for the advertising and performance marketing revenues based on the reportable segment for the three months ended June 30, 2026 and 2025.

Three months ended June 30,

Technology & Shopping

18 unchanged sentences

This excludes customers that generated less than $10,000 of revenues in the measurement period.

(2) Excludes customers that generated less than $2,500 in the quarter.

(2) Excludes customers that generated less than $2,500 in the quarter and those of certain newly acquired businesses.

(3) Represents total gross quarterly advertising and performance marketing revenues divided by customers as defined in footnote (2).

1 unchanged sentence

We believe that the number of customers that we serve is an indicator of our customer retention and growth.

We believe the average monthly revenue per customer provides insights that contribute to certain of our business planning decisions.

We believe the average quarterly revenue per customer provides insights that contribute to certain of our business planning decisions.

Due to the nature of certain of the Company’s services, changes in our customer base are expected and do not have significant financial implications for the Company as the Company generally does not have significant upfront customer acquisition costs for these customers.

The following table sets forth certain key operating metrics for subscription and licensing revenues based on the reportable segment for the three months ended March 31, 2026 and 2025.

Three months ended March 31,

The following table sets forth certain key operating metrics for subscription and licensing revenues based on the reportable segment for the three months ended June 30, 2026 and 2025.

Three months ended June 30,

Gaming & Entertainment

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Our critical accounting policies are described in our 2025 Annual Report on Form 10-K filed with the SEC on February 24, 2026.

During the three months ended March 31, 2026, there were no significant changes in our critical accounting policies and estimates.

During the six months ended June 30, 2026, there were no significant changes in our critical accounting policies and estimates.

See Note 1 — Basis of Presentation and Overview in Item 1 of Part I of this Quarterly Report on Form 10-Q for additional description of significant accounting policies of the Company.

The Company tests goodwill for impairment annually or more frequently if the Company believes indicators of impairment exist.

As a result of certain developments in one reporting unit within the Health & Wellness reportable segment during the three and six months ended June 30, 2026, the Company performed a quantitative impairment test described further below.

Goodwill - The Company tests goodwill for impairment annually or more frequently if the Company believes indicators of impairment exist.

The Company assessed current economic indicators, including changes in economic, market and industry conditions, business strategy, cost factors, and financial performance, among others, to determine if there would be a significant decline to the fair value of a particular reporting unit.

Following impairment at one reporting unit within the Cybersecurity & Martech reportable segment during the year ended December 31, 2025, there was no excess of fair value over the carrying value at that reporting unit.

So any further decrease in estimated fair value of this reporting unit greater than any decrease in the carrying value will result in an additional impairment charge to goodwill.

Goodwill at this reporting unit was $159.8 million as of March 31, 2026.

There were no other reporting units with less than 10% excess fair value over carrying value as of the most recent evaluation that may be at risk of impairment as of March 31, 2026.

During the three and six months ended June 30, 2026, the Company performed a quantitative fair value test on one reporting unit within the Health & Wellness reportable segment, following a period of declining results and reductions in forecasted revenue and earnings before interest, taxes, depreciation, and amortization (“EBITDA”) in the reporting unit during the second quarter of 2026.

Based on the quantitative fair value test, the carrying value exceeded its fair value, and the Company recorded an impairment of approximately $54.8 million during the three and six months ended June 30, 2026.

In addition, following impairment at one reporting unit within the Cybersecurity & Martech reportable segment during the year ended December 31, 2025, there was no excess of fair value over the carrying value at that reporting unit.

Thus, any further decrease in estimated fair value at these reporting units greater than any decrease in the carrying value at these reporting units will result in an additional impairment charge to goodwill.

Goodwill at these two reporting units was $196.3 million as of June 30, 2026.

There were no other reporting units with less than 10% excess fair value over carrying value as of the most recent evaluation that may be at risk of impairment as of June 30, 2026.

Changes in market conditions, and key assumptions made in future quantitative assessments, including expected cash flows, competitive factors and discount rates, could negatively impact the results of future impairment testing and could result in the recognition of an impairment charge.

Results of Operations for the Three Months Ended March 31, 2026

In each period, the fair value of the reporting units was determined using an equal weighting of an income approach that was based on the discounted estimated future cash flows of the reporting unit and a market approach that uses the guideline public company approach.

We believe the combination of these approaches provides an appropriate valuation because it incorporates the expected cash generation of the reporting unit in addition to how a third-party market participant would value the reporting unit.

As the business is assumed to continue in perpetuity, the discounted future cash flows include a terminal value.

Determining fair value using a discounted estimated future cash flow analysis requires the exercise of significant judgment with respect to several items, including the amount and timing of expected future cash flows and appropriate discount rates.

The expected cash flows used in the discounted cash flow analyses were based on the most recent forecast for the reporting unit.

For years beyond the forecast period, the estimates were based, in part, on forecasted growth rates.

The discount rate the Company used represents the estimated weighted average cost of capital, which reflects the overall level of inherent risk involved in its reporting unit operations and the rate of return a market participant would expect to earn.

Determining fair value using a market approach considers multiples of financial metrics based on trading multiples of a selected peer group of companies.

From the comparable companies, a representative market multiple is determined, which is applied to financial metrics to estimate the fair value of the reporting unit.

Long-lived assets - The Company accounts for long-lived assets, which include property and equipment, operating lease right-of-use assets, and identifiable intangible assets with finite useful lives (subject to amortization), in accordance with the provisions of the Financial Accounting Standards Board (“FASB”) ASC Topic 360, Property, Plant, and Equipment , which requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Recoverability is measured by comparing the carrying amount of an asset to the expected undiscounted future net cash flows generated by the asset.

If it is determined that the asset may not be recoverable, and if the carrying amount of an asset exceeds its estimated fair value, an impairment charge is recognized to the extent of the difference.

During the three and six months ended June 30, 2026, the Company assessed the recoverability of certain of its assets in its Health & Wellness reportable segment following reductions in forecasted revenue and EBITDA in one of its asset groups and recorded an impairment of its internal-use-software of approximately $1.8 million within ‘General, administrative, and other related costs’ in the Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2026.

The fair value of the internal-use-software was estimated using the multi-period excess earnings method under the income approach, which utilizes assumptions including projected future revenue generated from the asset, projected expenses, and discount rate.

Results of Operations for the Three and Six Months Ended June 30, 2026

The main focus of our Technology & Shopping, Gaming & Entertainment, and Health & Wellness platform monetization programs is to provide relevant and useful advertising to visitors to our websites, provide meaningful content that informs and shapes purchase intent, and leverage our brand and editorial assets into subscription platforms.

As a result, we expect to continue to take steps to improve the relevance of the ads displayed on our websites and applications and those included within our advertising networks, and improve the effectiveness of our content as well as our subscription services and licenses.

The operating margin we realize on revenues generated from ads placed on our websites and applications is significantly higher than the operating margin we realize from revenues generated from those placed on third-party websites

and applications.

Growth in advertising revenues from our websites and applications has generally exceeded that from third-party websites and applications.

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In the past, we have divested certain businesses that we determined were no longer consistent with the Company’s focus or that no longer aligned with the current or expected business performance of the Company’s other businesses.

Our planned divestiture of the Connectivity business is intended to support our ongoing effort to maximize value for the Company’s shareholders.

The divestiture of the Connectivity business is intended to support our ongoing effort to maximize value for the Company’s shareholders.

We are monitoring ongoing developments surrounding international trade and the macroeconomic environment.

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(in thousands, except percentages)

Three months ended March 31, Percentage Change

Three months ended June 30, Percentage Change Six months ended June 30, Percentage Change

2026 2025 2026 2025

Revenues $ 286,738 $ 294,803 (2.7)% $ 554,379 $ 567,619 (2.3)%

Our revenues consist of revenues from (i) advertising and performance marketing revenues, which are earned from the delivery of advertising services, marketing, performance marketing, and production services, and (ii) subscription and licensing revenues, which are earned through the granting of access to, or delivery of, certain data products or services to customers, usage-based fees, and by reselling various third-party solutions, primarily through the Company’s email security line of business.

Our revenues consist of revenues from (i) advertising and performance marketing revenues, which are earned from the delivery of advertising services, marketing, performance marketing, and production services, and (ii) subscription and licensing revenues, which are earned through the granting of access to, or delivery of, certain services to customers, usage-based fees, and by reselling various third-party solutions, primarily through the Company’s email security line of business.

Subscription and licensing revenues primarily consist of revenues from “fixed” customer subscription and licensing revenues and “variable” revenues generated from actual usage of our services.

Our revenues decreased during the three months ended March 31, 2026 compared to the prior period primarily due to a $8.8 million decrease in advertising and performance marketing revenues.

This decrease was driven primarily by a $11.1 million decrease in our Technology & Shopping reportable segment, partially offset by a $1.3 million increase in Gaming & Entertainment reportable segment and $1.0 million increase in our Health & Wellness reportable segment.

Subscription and licensing revenues increased $1.9 million compared to the prior year period due primarily to a $1.5 million increase in our Gaming & Entertainment reportable segment.

Other revenues increased $1.8 million compared to the prior year period due primarily to a $2.7 million increase in our Cybersecurity & Martech reportable segment, partially offset by a $0.9 million decrease in our Health & Wellness reportable segment.

Included in revenue during the three months ended March 31, 2026 was $11.1 million of incremental revenues contributed by businesses acquired during 2025.

(in thousands, except percentages) Three months ended March 31, Percentage Change

Our revenues decreased during the three months ended June 30, 2026 compared to the prior period primarily due to an $11.5 million decrease in advertising and performance marketing revenues.

This decrease was driven primarily by a $5.7 million decrease in the Technology & Shopping reportable segment, a $3.1 million decrease in the Gaming & Entertainment reportable segment, and a $2.7 million decrease in the Health & Wellness reportable segment.

Subscription and licensing revenues decreased $0.2 million.

Other revenues increased $3.7 million compared to the prior year period due primarily to a $3.0 million increase in the Cybersecurity & Martech reportable segment.

Included in revenue during the three months ended June 30, 2026 were $7.1 million of incremental revenues contributed by businesses acquired during the first half of 2026 and the full year 2025.

Our revenues decreased during the six months ended June 30, 2026 compared to the prior period primarily due to a $20.4 million decrease in advertising and performance marketing revenues.

This decrease was driven primarily by a $16.8 million decrease in the Technology & Shopping reportable segment, a $1.8 million decrease in the Gaming & Entertainment reportable segment and a $1.7 million decrease in the Health & Wellness reportable segment.

Subscription and licensing revenues increased $1.6 million compared to the prior year period due primarily to a $3.8 million increase in our Gaming & Entertainment reportable segment, partially offset by a $2.9 million decrease in our Cybersecurity & Martech reportable segment.

Other revenues increased $5.5 million compared to the prior year period due primarily to a $5.7 million increase in our Cybersecurity & Martech reportable segment.

Included in revenue during the six months ended June 30, 2026 was $18.2 million of incremental revenues contributed by businesses acquired during the first half of 2026 and the full year 2025.

(in thousands, except percentages) Three months ended June 30, Percentage Change Six months ended June 30, Percentage Change

2026 2025 2026 2025

$ 45,711 $ 40,663 12.4% $ 90,028 $ 81,064 11.1%

As a percent of revenues

1 unchanged sentence

Direct costs represent the Company’s cost of revenues and primarily include costs associated with compensation for personnel directly involved in revenue generation, content fees, production costs, royalty fees, hosting and licensing costs, and processing fees.

The increase in direct costs for the three months ended March 31, 2026 compared to the prior period was primarily due to a $1.5 million increase in campaign fulfillment costs related to a business acquired in 2025, a $1.5 million increase in partner payments, and a $1.4 million increase in cloud computing, software, and other related expenses.

The increase in direct costs for the three months ended June 30, 2026 compared to the prior period was primarily due to a $2.0 million increase in cloud computing, software, and other related expenses, a $1.0 million increase in campaign fulfillment costs related primarily to a business acquired in 2025, and a $0.7 million increase in salaries, benefits, and other employee expenses.

The increase in direct costs for the six months ended June 30, 2026 compared to the prior period was primarily due to a $3.4 million increase in cloud computing, software, and other related expenses, a $2.1 million increase in campaign fulfillment costs related primarily to a business acquired in 2025, a $2.2 million increase in partner payments, and a $1.0 million increase in salaries, benefits, and other employee expenses.

Sales and Marketing

(in thousands, except percentages) Three months ended March 31, Percentage Change

(in thousands, except percentages) Three months ended June 30, Percentage Change Six months ended June 30, Percentage Change

2026 2025 2026 2025

Sales and marketing

4 unchanged sentences

Our internet-based advertising relationships consist primarily of fixed cost and performance-based (cost-per-impression, cost-per-click, and cost-per-acquisition) advertising relationships with an array of online service providers.

The increase in sales and marketing expenses during the three months ended March 31, 2026 compared to the prior period was primarily due to a $4.5 million increase in salaries, benefits, and other employee expenses as a result of prior year acquisitions, partially offset by a $1.6 million decrease in professional and third-party services.

The decrease in sales and marketing expenses during the three months ended June 30, 2026 compared to the prior period was primarily due to a $1.9 million decrease in professional and third-party services, a $1.4 million decrease in advertising and marketing related expenses, and a $0.9 million decrease in cloud computing, software, and other related expenses.

The decrease in sales and marketing expenses for the six months ended June 30, 2026 compared to the prior period was primarily due to a $3.6 million decrease in professional and third-party services and a $2.7 million decrease in advertising and marketing related expenses, partially offset by a $4.4 million increase in salaries, benefits, and other employee expenses.

Research, Development, and Engineering

(in thousands, except percentages) Three months ended March 31, Percentage Change

(in thousands, except percentages) Three months ended June 30, Percentage Change Six months ended June 30, Percentage Change

2026 2025 2026 2025

Research, development, and engineering

1 unchanged sentence

As a percent of revenues

5.0 % 4.8 % 5.1 % 5.0 %

Research, development, and engineering costs consist primarily of salaries, benefits, and other employee expenses.

The decrease in research, development, and engineering costs for the three months ended March 31, 2026, compared to the prior period was primarily due to a $0.4 million decrease in salaries, benefits, and other employee expenses, partially offset by a $0.2 million increase in professional and other third-party services.

The increase in research, development, and engineering costs for the three months ended June 30, 2026, compared to the prior period was primarily due to a $0.7 million increase in professional and other third-party services, partially offset by a $0.6 million decrease in salaries, benefits, and other employee expenses.

Research, development, and engineering costs for the six months ended June 30, 2026 compared to the prior period remained consistent.

General, Administrative, and Other Related Costs

(in thousands, except percentages) Three months ended March 31, Percentage Change

(in thousands, except percentages) Three months ended June 30, Percentage Change Six months ended June 30, Percentage Change

2026 2025 2026 2025

General, administrative, and other related costs

3 unchanged sentences

General, administrative, and other related costs consist primarily of salaries, benefits, and other employee expenses including share-based compensation and severance, changes in the fair value associated with contingent consideration, bad debt expense, professional fees, and insurance costs.

The increase in general, administrative, and other related costs for the three months ended March 31, 2026 compared to the prior period was primarily due to a $3.3 million increase in professional and other third-party services.

The decrease in general, administrative, and other related costs for the three months ended June 30, 2026 compared to the prior period was primarily due to a $4.2 million decline in indirect tax expense driven by a reduction in certain reserves due to the expiration of certain statutes of limitations and a $0.8 million decrease in salaries, benefits, and other employee expenses, partially offset by a $2.7 million increase in professional and other third-party services and a $1.8 million long-lived asset impairment.

The increase in general, administrative, and other related costs for the six months ended June 30, 2026 compared to the prior period was primarily due to a $5.4 million increase in professional and other third-party services and a $1.8 million long-lived asset impairment, partially offset by the $4.2 million decline in indirect tax expense and a $1.5 million decrease in salaries, benefits, and other employee expenses.

Depreciation and Amortization

(in thousands, except percentages) Three months ended March 31, Percentage Change

(in thousands, except percentages) Three months ended June 30, Percentage Change Six months ended June 30, Percentage Change

2026 2025 2026 2025

Depreciation and amortization

3 unchanged sentences

Depreciation and amortization costs consist of depreciation related to property and equipment, including internally developed software, as well as amortization of intangible assets recorded in connection with business acquisitions, and other intangible assets of the Company.

The decrease in depreciation and amortization for the three months ended March 31, 2026 compared to the prior period was primarily due to a $4.2 million decrease in amortization expense due to certain intangible assets being in run-off state and having a greater amortization expense earlier in life.

The decrease in depreciation and amortization for the three months ended June 30, 2026 compared to the prior period was primarily due to a $3.9 million decrease in amortization expense due to certain intangible assets being in run-off state and having a greater amortization expense earlier in life.

The decrease in depreciation and amortization for the six months ended June 30, 2026 compared to the prior period was primarily due to an $8.1 million decrease in amortization expense due to certain intangible assets being in run-off state and having a greater amortization expense earlier in life.

Goodwill Impairment

Goodwill impairment was $54.8 million for the three and six months ended June 30, 2026 and related to a reporting unit within the Health & Wellness reportable segment.

Goodwill impairment was zero for the three and six months ended June 30, 2025.

Refer to Note 7 — Goodwill and Intangible Assets in Part I Item 1 of this Quarterly Report on Form 10-Q.

Non-Operating Income and Expenses

The following table represents the components of non-operating income and expenses for the three months ended March 31, 2026 and 2025 (in thousands):

Three months ended March 31, Percentage Change

The following table represents the components of non-operating income and expenses for the three and six months ended June 30, 2026 and 2025 (in thousands):

Three months ended June 30, Percentage Change Six months ended June 30, Percentage Change

2026 2025 2026 2025

Interest expense, net $ (5,770) $ (6,584) (12.4) % $ (12,666) $ (12,778) (0.9) %

Other income (loss), net 688 (1,475) (146.6) %

Gain on investments, net — 4,340 (100.0) % — 4,340 (100.0) %

Other (loss) income, net (586) (2,402) (75.6) % 102 (3,877) (102.6) %

Total non-operating expense

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Interest expense is generated primarily from interest due on outstanding debt, partially offset by interest income generated from interest earned on cash, cash equivalents, and investments.

Interest expense, net increased during the three months ended March 31, 2026 compared to the prior periods primarily due to lower interest income on investments as a result of a decline in cash equivalents and a reduction in interest rates.

Interest expense, net decreased during the three months ended June 30, 2026 compared to the prior periods primarily due to higher interest income on investments as a result of an increase in cash equivalents as a result of the sale of Connectivity.

Interest expense, net remained consistent during the six months ended June 30, 2026 compared to the prior period.

Gain (loss) on investments, net.

Gain (loss) on investments, net is generated from realized and unrealized gains or losses from investments in equity and debt securities.

Gain on investments, net recorded during the three and six months ended June 30, 2025 related to the disposition of the minority equity ownership interest in OpenEvidence (formerly known as Xyla).

Other income (loss), net.

Other income (loss), net is generated primarily from miscellaneous items and gains or losses on foreign currency.

The change was primarily attributable to changes in gains or losses on foreign currency.

The change in each period was primarily attributable to changes in gains or losses on foreign currency.

The Company’s effective tax rate is based on pre-tax income, statutory tax rates, tax regulations (including those related to transfer pricing), and different tax rates in the various jurisdictions in which we operate.

The tax basis of our assets and liabilities reflect our best estimate of the tax benefits and costs we expect to realize.

The tax basis of our tax assets and liabilities reflect our best estimate of the tax benefits and costs we expect to realize.

When necessary, we establish valuation allowances to reduce our deferred tax assets to an amount that will more likely than not be realized.

Provision for income taxes from continuing operations amounted to income tax expense of $2.6 million and $3.6 million for the three months ended March 31, 2026 and 2025, respectively.

Our effective tax rate was (80.5)% and 53.2% for the three months ended March 31, 2026 and 2025, respectively.

The change in our effective income tax rate for the three months ended March 31, 2026 compared to the prior period was primarily attributable to the following:

Pre-tax book loss for the three months ended March 31, 2026 compared to pre-tax book income for the three months ended March 31, 2025, resulted in a disproportionate effective income tax rate;

partially offset by

an increase in our foreign-derived deduction-eligible income ("FDDEI”) due to changes under OBBBA that are effective starting January 1, 2026 and simplified expense allocations.

Provision for income taxes from continuing operations amounted to income tax expense of $0.9 million and income tax benefit of $0.1 million for the three months ended June 30, 2026 and 2025, respectively, and income tax expense of $3.6 million and $3.5 million for the six months ended June 30, 2026 and 2025, respectively.

Our effective tax rate was (1.8)% and (0.8)% for the three months ended June 30, 2026 and 2025, respectively, and (6.6)% and 22.3% for the six months ended June 30, 2026 and 2025, respectively.

The effective tax rate of (1.8)% during the three months ended June 30, 2026 and the effective tax rate of (0.8%) during the three months ended June 30, 2025 were both disproportionately impacted by the following factors:

The second quarter of 2026 rate was impacted by the goodwill impairment since the impairment related to excess financial statement goodwill with no tax basis and no corresponding tax benefit was recognized;

The second quarter of 2025 rate was impacted by a discrete tax benefit from the release of the valuation allowance against our U.S.

capital loss carryforwards which resulted in a reduction of the effective income tax rate in the period.

In addition, the effective tax rate decreased in the second quarter of 2026 due to a larger benefit in 2026, as compared with the prior period, as a result of an increase in our foreign-derived deduction-eligible income ("FDDEI”) deduction and simplified expense allocations due to changes under the OBBBA that were effective starting January 1, 2026.

The decrease in our effective income tax rate to (6.6)% for the six months ended June 30, 2026 compared to 22.3% in the prior period was primarily attributable to the following:

The goodwill impairment recognized for book purposes during 2026 with no similar event in 2025.

Since the impairment related to excess financial statement goodwill with no tax basis, no corresponding tax benefit was recognized resulting in a disproportionate effective income tax rate in 2026;

A discrete tax charge of $1.3 million in 2026 from remeasuring our deferred taxes due to a change in our expected state tax rates;

The absence of a discrete tax benefit that occurred in 2025 due to a release of the valuation allowance against our U.S.

capital loss carryforwards which resulted in a discrete tax benefit of $3.2 million recognized during 2025 with no similar event in 2026.

Judgment is required in determining our provision for income taxes and in evaluating our tax positions on a worldwide basis.

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The Company currently does not expect the OBBBA to have a material impact on its effective tax rate but expects these provisions to result in a reduction of current income tax liabilities and an increase in deferred tax liabilities.

The Company will continue to assess the implications of the OBBBA and will provide further disclosures in subsequent reporting periods, as necessary.

Equity Method Investment

Income from equity method investment, net of tax.

Income from equity method investment was primarily from the investment in the OCV Fund I, LP (the “OCV Fund”) for which the Company receives annual audited financial statements.

(Loss) income from equity method investment, net of tax was primarily from the investment in the OCV Fund I, LP (the “OCV Fund”) for which the Company receives annual audited financial statements.

The investment in the OCV Fund is presented net of tax.

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If the Company becomes aware of a significant decline in value that is other-than-temporary, the loss will be recorded in the period in which the Company identifies the decline.

Income from equity method investment was $5.1 million, net of tax, for the three months ended March 31, 2026 compared to income from equity method investment of $6.6 million, net of tax, for the three months ended March 31, 2025.

The decrease in income from equity method investment, net of tax during the three months ended March 31, 2026 compared to the prior period was primarily due to a decrease in the value of the underlying investments.

(Loss) income from continuing operations

Loss from continuing operations was $0.8 million for the three months ended March 31, 2026 compared to income from continuing operations of $9.8 million for the three months ended March 31, 2025.

The decrease in income from continuing operations during the three months ended March 31, 2026 compared to the prior period was driven by the factors discussed above.

Loss from equity method investment was $0.1 million, net of tax, for the three months ended June 30, 2026 compared to income from equity method investment of $5.1 million, net of tax, for the three months ended June 30, 2025.

Income from equity method investment was $5.0 million, net of tax, for the six months ended June 30, 2026 compared to income from equity method investment of $11.7 million, net of tax, for the six months ended June 30, 2025.

The decrease in income from equity method investment, net of tax during the three months ended June 30, 2026 compared to the prior period was primarily due to a decrease in the value of the underlying investments.

The decrease in income from equity method investment, net of tax during the six months ended June 30, 2026 compared to the prior period was primarily due to a decrease in the value of the underlying investments.

Net (loss) income from continuing operations

Net loss from continuing operations was $52.2 million for the three months ended June 30, 2026 compared to net income from continuing operations of $14.3 million for the three months ended June 30, 2025.

Net loss from continuing operations was $52.9 million for the six months ended June 30, 2026 compared to net income from continuing operations of $24.1 million for the six months ended June 30, 2025.

The decrease in net income from continuing operations during the three and six months ended June 30, 2026 compared to the prior period was driven by the factors discussed above.

Net income from discontinued operations, net of tax

Net income from discontinued operations, net of tax was $23.0 million for the three months ended March 31, 2026 compared to net income from discontinued operations, net of tax of $14.4 million for the three months ended March 31, 2025.

The increase in net income from discontinued operations, net of tax during the three months ended March 31, 2026 compared to the prior period was primarily due to a $3.8 million increase in revenues and a $16.0 million increase in income tax benefit related primarily to deferred tax assets recorded upon our classification of Connectivity as held-for-sale, partially offset by a $8.8 million increase in transaction costs and $2.3 million increase in stock-based compensation related to the disposition of the Connectivity business.

Net income was $22.3 million for the three months ended March 31, 2026 compared to net income of $24.2 million for the three months ended March 31, 2025.

The decrease in net income during the three months ended March 31, 2026 compared to the prior period was driven by the factors discussed above.

Net income from discontinued operations, net of tax was $676.6 million for the three months ended June 30, 2026 compared to net income from discontinued operations, net of tax of $12.0 million for the three months ended June 30, 2025.

The increase in net income from discontinued operations was driven by the pre-tax gain on the sale of Connectivity of $860.6 million, partially offset by higher tax expense of $197.4 million due primarily to the tax impact of the gain on sale of $200.0 million recorded during the second quarter of 2026.

Net income from discontinued operations, net of tax was $699.7 million for the six months ended June 30, 2026 compared to net income from discontinued operations, net of tax of $26.5 million for the six months ended June 30, 2025.

increase in net income from discontinued operations, net of tax during the three months ended June 30, 2026 compared to the prior period was primarily due to the pre-tax gain on the sale of Connectivity of $860.6 million, partially offset by higher tax expense of $181.4 million.

The higher tax expense was due to the $200.0 million tax impact of the gain on sale recorded during the second quarter of 2026, partially offset by an income tax benefit related primarily to deferred tax assets recorded during the first quarter of 2026 upon our classification of Connectivity as held-for-sale.

Net income was $624.5 million for the three months ended June 30, 2026 compared to net income of $26.3 million for the three months ended June 30, 2025.

Net income was $646.7 million for the six months ended June 30, 2026 compared to net income of $50.6 million for the six months ended June 30, 2025.

The increase in net income during the three and six months ended June 30, 2026 compared to the prior period was driven by the factors discussed above.

Segment Results

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The financial results are presented as follows (in thousands):

Three months ended March 31, Percentage Change

Three months ended June 30, Percentage Change Six months ended June 30, Percentage Change

2026 2025 2026 2025

Revenues $ 76,757 $ 80,776 (5.0) % $ 147,916 $ 162,466 (9.0) %

Operating costs and expenses 80,063 88,720 (9.8) % 157,680 174,373 (9.6) %

77,617 85,653 (9.4) %

Operating loss $ (3,306) $ (7,944) (58.4) % $ (9,764) $ (11,907) (18.0) %

$ (6,458) $ (3,963) 63.0 %

Technology & Shopping’s revenues of $71.2 million during the three months ended March 31, 2026 decreased $10.5 million compared to the prior period primarily due to a $11.1 million decrease in advertising and performance marketing revenues, primarily driven by $4.4 million and $3.6 million decreases in performance marketing revenues in our Technology business and our Shopping business, respectively, and a $2.6 million decrease in the first party advertising revenues in our Technology business, partially offset by a $0.6 million increase in subscription and licensing revenues.

Technology & Shopping’s revenues of $76.8 million during the three months ended June 30, 2026 decreased $4.0 million compared to the prior period primarily due to a $5.7 million decrease in advertising and performance marketing revenues, primarily driven by $4.1 million and $3.4 million decreases in advertising and performance marketing revenues in our Technology businesses and our Shopping businesses, respectively, partially offset by a $1.0 million increase in subscription and licensing revenues and a $0.7 million increase in other revenues.

The decline in revenues during the quarter was driven by traffic pressures impacting affiliate commerce and programmatic display advertising.

Technology & Shopping’s operating costs and expenses of $77.6 million during the three months ended March 31, 2026 decreased $8.0 million compared to the prior period primarily driven by a $2.5 million decrease in an advertising and performance marketing related expenses, a $2.2 million decrease in professional and other third-party services, a $2.0 million decrease in salaries, benefits, and other employee expenses, and a $1.8 million decrease in depreciation and amortization expenses, partially offset by a $0.8 million increase in partner payments.

As a result of these factors, Technology & Shopping’s operating loss of $(6.5) million during the three months ended March 31, 2026 increased $2.5 million compared to the prior period.

Technology & Shopping’s revenues of $147.9 million during the six months ended June 30, 2026 decreased $14.6 million compared to the prior period primarily due to a $16.8 million decrease in advertising and performance marketing revenues, primarily driven by $11.4 million and $7.2 million decreases in advertising and performance marketing revenues in our Technology businesses and our Shopping businesses, respectively, partially offset by a $1.6 million increase in subscription and licensing revenues and a $0.7 million increase in other revenues.

The decline in revenues during the period was driven by traffic pressures impacting affiliate commerce and programmatic display advertising.

Technology & Shopping’s operating costs and expenses of $80.1 million during the three months ended June 30, 2026 decreased $8.7 million compared to the prior period primarily driven by a $2.5 million decrease in depreciation and amortization expenses, a $2.3 million decrease in salaries, benefits, and other employee expenses, a $2.2 million decrease in professional and other third-party services, and a $1.9 million decrease in advertising and performance marketing related expenses.

Technology & Shopping’s operating costs and expenses of $157.7 million during the six months ended June 30, 2026 decreased $16.7 million compared to the prior period primarily driven by a $4.4 million decrease in professional and other third-party services, a $4.3 million decrease in advertising and performance marketing related expenses, a $4.3 million decrease in depreciation and amortization expenses, and a $4.3 million decrease in salaries, benefits, and other employee expenses.

As a result of these factors, Technology & Shopping’s operating loss of $3.3 million during the three months ended June 30, 2026 decreased $4.6 million compared to the prior period.

Technology & Shopping’s operating loss of $9.8 million during the six months ended June 30, 2026 decreased $2.1 million compared to the prior period.

Gaming & Entertainment

The financial results are presented as follows (in thousands):

Three months ended March 31, Percentage Change

Three months ended June 30, Percentage Change Six months ended June 30, Percentage Change

2026 2025 2026 2025

Revenues $ 46,619 $ 46,226 0.9 % $ 87,383 $ 84,252 3.7 %

Operating costs and expenses 37,602 34,971 7.5 % 70,482 64,223 9.7 %

32,880 29,252 12.4 %

Operating income $ 9,017 $ 11,255 (19.9) % $ 16,901 $ 20,029 (15.6) %

$ 7,884 $ 8,774 (10.1) %

Gaming & Entertainment’s revenues of $40.8 million during the three months ended March 31, 2026 increased $2.7 million compared to the prior period primarily due to a $1.5 million increase in subscription and licensing revenues and a $1.3 million increase in advertising and performance marketing revenues, both in our Humble Bundle business.

Gaming & Entertainment’s operating costs and expenses of $32.9 million during the three months ended March 31, 2026 increased $3.6 million compared to the prior period primarily due to a $1.0 million increase in partner payments, a $0.9 million increase in professional and other third-party services, and a $0.8 million increase in salaries, benefits, and other employee expenses.

As a result of these factors, Gaming & Entertainment’s operating income of $7.9 million during the three months ended March 31, 2026 decreased $0.9 million compared to the prior period.

Gaming & Entertainment’s revenues of $46.6 million during the three months ended June 30, 2026 increased $0.4 million compared to the prior period primarily due to a $2.3 million increase in subscription and licensing revenues driven by our Humble Bundle business and a $1.2 million increase in other revenue, partially offset by a decrease of $3.1 million in advertising and performance marketing revenues.

Gaming & Entertainment’s revenues of $87.4 million during the six months ended June 30, 2026 increased $3.1 million compared to the prior period primarily due to a $3.8 million increase in subscription and licensing revenues driven by our Humble Bundle business and a $1.2 million increase in other revenue, partially offset by a decrease of $1.8 million in advertising and performance marketing revenues.

Gaming & Entertainment’s operating costs and expenses of $37.6 million during the three months ended June 30, 2026 increased $2.6 million compared to the prior period primarily due to a $0.8 million increase in professional and other third-party services and a $0.7 million increase in advertising and marketing related expenses.

Gaming & Entertainment’s operating costs and expenses of $70.5 million during the six months ended June 30, 2026 increased $6.3 million compared to the prior period primarily due to a $1.7 million increase in professional and other third-party services, a $1.4 million increase in partner payments, and a $0.8 million increase in advertising and marketing related expenses.

As a result of these factors, Gaming & Entertainment’s operating income of $9.0 million during the three months ended June 30, 2026 decreased $2.2 million compared to the prior period.

Gaming & Entertainment’s operating income of $16.9 million during the six months ended June 30, 2026 decreased $3.1 million compared to the prior period.

Health & Wellness

The financial results are presented as follows (in thousands):

Three months ended March 31, Percentage Change

Three months ended June 30, Percentage Change Six months ended June 30, Percentage Change

2026 2025 2026 2025

Revenues $ 94,658 $ 99,452 (4.8) % $ 180,608 $ 185,238 (2.5) %

Operating costs and expenses 136,949 83,434 64.1 % 214,275 152,258 40.7 %

77,326 68,824 12.4 %

Operating income

$ 8,624 $ 16,962 (49.2) %

Health & Wellness’s revenues of $86.0 million during the three months ended March 31, 2026 increased $0.2 million compared to the prior period primarily due to a $1.0 million increase in advertising and performance marketing revenues, primarily driven by an increase in the Health & Wellness Consumer business due in part to an acquisition in 2025, partially offset by declines in other of our Health & Wellness lines of business.

The increase in advertising and performance marketing revenues was partially offset by a $0.9 million decrease in subscription and licensing revenues.

Health & Wellness’s operating costs and expenses of $77.3 million during the three months ended March 31, 2026 increased $8.5 million compared to the prior period primarily due to a $4.3 million increase in salaries, benefits, and other employee expenses due in part to an acquisition in 2025, an absence of $1.8 million reduction in expenses related to change in contingent consideration that occurred in the comparable 2025 period, and a $1.4 million increase in advertising and marketing related expenses.

As a result of these factors, Health & Wellness’s operating income of $8.6 million during the three months ended March 31, 2026 decreased $8.3 million compared to the prior period.

Operating (loss) income $ (42,291) $ 16,018 (364.0) % $ (33,667) $ 32,980 (202.1) %

Health & Wellness’s revenues of $94.7 million during the three months ended June 30, 2026 decreased $4.8 million compared to the prior period primarily due to a $2.7 million decrease in advertising and performance marketing revenues, primarily driven by a decrease in the Health & Wellness Professional lines of business.

In addition, other revenues decreased by $1.2 million driven by lower online course revenue and a decrease in subscription and licensing revenues of $0.9 million.

Health & Wellness’s revenues of $180.6 million during the six months ended June 30, 2026 decreased $4.6 million compared to the prior period primarily due to a decline of $2.1 million in other revenue driven by lower online course revenue and a decrease of $1.7 million in advertising and performance marketing revenues and a decline of $0.8 million in subscription and licensing revenues.

Health & Wellness’s operating costs and expenses of $136.9 million during the three months ended June 30, 2026 increased $53.5 million compared to the prior period primarily due to a $54.8 million goodwill impairment.

Health & Wellness’s operating costs and expenses of $214.3 million during the six months ended June 30, 2026 increased $62.0 million compared to the prior period primarily due to a $54.8 million goodwill impairment and an increase of $4.1 million in salaries, benefits, and other employee expenses.

As a result of these factors, Health & Wellness had an operating loss of $42.3 million during the three months ended June 30, 2026 compared to operating income of $16.0 million in the prior period.

Health & Wellness had an operating loss of $33.7 million during the six months ended June 30, 2026 compared to operating income of $33.0 million in the prior period.

Cybersecurity & Martech

The financial results are presented as follows (in thousands):

Three months ended March 31, Percentage Change

Three months ended June 30, Percentage Change Six months ended June 30, Percentage Change

2026 2025 2026 2025

Revenues $ 68,704 $ 68,349 0.5 % $ 138,472 $ 135,663 2.1 %

Operating costs and expenses 55,326 56,114 (1.4) % 111,397 112,105 (0.6) %

56,071 55,991 0.1 %

Operating income $ 13,378 $ 12,235 9.3 % $ 27,075 $ 23,558 14.9 %

$ 13,697 $ 11,323 21.0 %

Cybersecurity & Martech’s revenues of $69.8 million during the three months ended March 31, 2026 increased $2.5 million compared to the prior period primarily due to a $2.7 million increase in other revenues related to a business acquired in 2025 within the Company’s Martech business, partially offset by a $0.3 million decrease in subscription and licensing revenues.

Cybersecurity & Martech‘s operating costs and expenses of $56.1 million during the three months ended March 31, 2026 increased $0.1 million.

As a result of these factors, Cybersecurity & Martech’s operating income of $13.7 million during the three months ended March 31, 2026 increased $2.4 million compared to the prior period.

Cybersecurity & Martech’s revenues of $68.7 million during the three months ended June 30, 2026 increased $0.4 million compared to the prior period primarily due to a $3.0 million increase in other revenues related to a business acquired in 2025 within the Company’s Martech business, partially offset by a $2.6 million decrease in subscription and licensing revenues.

Cybersecurity & Martech’s revenues of $138.5 million during the six months ended June 30, 2026 increased $2.8 million compared to the prior period primarily due to a $5.7 million increase in other revenues related to a business acquired in 2025 within the Company’s Martech business, partially offset by a $2.9 million decrease in subscription and licensing revenues.

Cybersecurity & Martech‘s operating costs and expenses of $55.3 million during the three months ended June 30, 2026 decreased $0.8 million due primarily to a decline in indirect tax expense of $4.3 million driven by a reduction in certain reserves due to the expiration of certain statutes of limitations, partially offset by a $1.8 million increase in salaries, benefits, and other employee expenses, and a $1.3 million increase in campaign fulfillment costs.

Cybersecurity & Martech‘s operating costs and expenses of $111.4 million during the six months ended June 30, 2026 decreased $0.7 million primarily due to a decline in indirect tax expense of $4.3 million driven by a reduction in certain reserves due to the expiration of certain statutes of limitations and a $3.8 million decrease in depreciation and amortization, partially offset by an increase of $2.8 million in campaign fulfillment costs, an increase of $2.6 million in salaries, benefits, and other employee expenses, and an increase of $1.8 million in cloud computing, software, and other related expenses.

As a result of these factors, Cybersecurity & Martech’s operating income of $13.4 million during the three months ended June 30, 2026 increased $1.1 million compared to the prior period.

Cybersecurity & Martech’s operating income of $27.1 million during the six months ended June 30, 2026 increased $3.5 million compared to the prior period.

Liquidity and Capital Resources

Our primary sources of liquidity and capital resources are cash flows from operations and debt financing.

Our primary sources of liquidity and capital resources are cash and cash equivalents, cash flows from operations and debt financing.

We continue to invest in the development and expansion of our operations using available cash flows from operations.

Ongoing investments include, but are not limited to, improvements in our offerings, investments in new products and s ervices, acquisitions, and continued investments in sales and marketing.

We also use cash flows from operations to service our debt obligations and the repurchase of our shares.

Ongoing investments include, but are not limited to, improvements in our offerings, investments in new products and s ervices, and acquisitions.

We also use cash and cash equivalents and cash flows from operations to service our debt obligations, meet our tax obligations, including those associated with the gain on the sale of Connectivity, and repurchase our shares.

Cash and Cash Equivalents

As of March 31, 2026 and December 31, 2025, our cash and cash equivalents were $519.7 million and $573.8 million, respectively.

As of June 30, 2026 and December 31, 2025, our cash and cash equivalents were $1,606.1 million and $573.8 million, respectively.

Cash and cash equivalents held within domestic and foreign jurisdictions were as follows (in thousands):

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Cash and cash equivalents held in domestic jurisdiction $ 1,490,603 $ 481,021

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On June 18, 2024, the Company entered into a New Lender Joinder Agreement and Eighth Amendment (the “Joinder and Amendment”) to the Credit Agreement.

The Joinder and Amendment provides for, among other things, (i) an increase in the Aggregate Revolving Loan Commitment by an aggregate principal amount of $250.0 million for a total of $350.0 million, (ii) an extension of the scheduled maturity date from April 7, 2026 to the earlier of (x) June 18, 2027 or (y) under certain limited circumstances, August 2, 2026, (iii) a “credit spread adjustment” for SOFR-based borrowings of 0.10% across all interest periods, (iv) the inclusion of limited conditionality borrowing mechanics with respect to certain borrowings, and (v) certain other related amendments.

As of each March 31, 2026 and December 31, 2025, availability under the Credit Agreement was $348.8 million, net of letters of credit.

The Joinder and Amendment provides for, among other things, (i) an increase in the Aggregate Revolving Loan Commitment by an aggregate principal amount of $250.0 million for a total of $350.0 million, (ii) an extension of the scheduled maturity date from April 7, 2026 to the earlier of (x) June 18, 2027 or (y) under certain limited circumstances that did not occur, August 2, 2026, (iii) a “credit spread adjustment” for SOFR-based borrowings of 0.10% across all interest periods, (iv) the inclusion of limited conditionality borrowing mechanics with respect to certain borrowings, and (v) certain other related amendments.

As of June 30, 2026 and December 31, 2025, availability under the Credit Agreement was $348.9 million and $348.8 million, respectively, net of letters of credit.

On July 16, 2024, the Company issued $263.1 million in aggregate principal amount of new 3.625% Convertible Notes due 2028 (the “3.625% Convertible Notes”) and paid an aggregate of approximately $135.0 million in cash in exchange for approximately $400.9 million in aggregate principal amount of the Company’s 1.75% Convertible Notes (collectively, the “Exchange Transaction”) pursuant to separate, privately negotiated exchange agreements with certain holders of the 1.75% Convertible Notes.

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Refer to Note 8 – Debt and Note 3 — Acquisitions in Part I Item 1 of this Quarterly Report on Form 10-Q.

As of March 31, 2026, we and our subsidiaries had outstanding $867.1 million in aggregate principal amount of indebtedness.

As of March 31, 2026, our total future minimum lease payments were $27.2 million of which approximately $6.8 million future minimum lease payments are due in the succeeding twelve months.

As of March 31, 2026, our liability for uncertain tax positions was $29.5 million.

As of June 30, 2026, we and our subsidiaries had outstanding $872.3 million in aggregate principal amount of indebtedness.

As of June 30, 2026, our total future minimum lease payments were $26.9 million of which approximately $7.1 million future minimum lease payments are due in the succeeding twelve months.

As of June 30, 2026, our liability for uncertain tax positions was $19.6 million.

In the ordinary course of business, the Company enters into commitments including those related to cloud computing, information technology, security, and information and document management.

also has revenue sharing arrangements with annual minimum guarantees based upon third-party website advertising metrics and other contractual provisions.

The Company also has revenue sharing arrangements with annual minimum guarantees based upon third-party website advertising metrics and other contractual provisions.

We currently anticipate that our existing cash and cash equivalents, cash generated from operations, and availability under our revolving credit facility, will be sufficient to meet our anticipated needs for working capital, capital expenditures, principal payments on our indebtedness, and share repurchases, if any, for at least the next 12 months.

The following table provides a summary of cash flows from operating, investing, and financing activities from continuing and discontinued operations (in thousands):

Three months ended March 31, Change

Six months ended June 30, Change

Net cash provided by operating activities $ 118,916 $ 77,687 $ 41,229

Net cash used in investing activities $ (33,207) $ (64,829) $ 31,622

Net cash provided by (used in) investing activities $ 1,057,716 $ (71,600) $ 1,129,316

Net cash used in financing activities $ (173,784) $ (66,888) $ (106,896)

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Our net cash provided by operating activities resulted primarily from cash received from our customers offset by cash payments we made to third parties for their services, employee compensation, interest payments associated with our debt, and taxes.

The $9.3 million increase in net cash provided by operating activities during the three months ended March 31, 2026 compared to the prior period was primarily related to increased collections from our customers and a decrease in prepaid expenses during the current period, partially offset by increased payments to our vendors.

The increase in net cash provided by operating activities includes the activities of TDS Gift Cards, which had a negative impact of $(89.6) million and $(84.0) million during the first quarter of 2026 and the first quarter of 2025, respectively.

The $41.2 million increase in net cash provided by operating activities during the six months ended June 30, 2026 compared to the prior period was primarily related to increased collections from our customers.

The increase in net cash provided by operating activities includes the activities of TDS Gift Cards, which had a negative impact of $78.1 million and $86.6 million during the first six months of 2026 and the first six months of 2025, respectively.

Investing Activities

The $31.6 million decrease in net cash used in investing activities during the three months ended March 31, 2026 compared to the prior period was primarily related to no cash used on business acquisitions during the three months ended March 31, 2026.

The $1,129.3 million increase in net cash provided in investing activities during the six months ended June 30, 2026 compared to the prior period was primarily related to cash received at closing of the Connectivity sale of $1,134.1 million, net of cash divested.

Financing Activities

The $18.5 million increase in net cash used in financing activities during the three months ended March 31, 2026 compared to the prior period was primarily related to a larger amount of cash used for share repurchases.

The $106.9 million increase in net cash used in financing activities during the six months ended June 30, 2026 compared to the prior period was primarily related to a larger amount of cash used for share repurchases.

Stock Repurchase Program

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In connection with the authorization, the Company entered into certain Rule 10b5-1 trading plans with a broker-dealer to facilitate the repurchase program.

On February 22, 2026, the Board of the Company authorized (i) an increase in its 2020 Program pursuant to which the Company may purchase up to an additional ten million shares of the Company’s common stock and (ii) an extension of the expiration date of the share repurchase program from August 2, 2029 to February 22, 2036 (“Amended Stock Repurchase

As a result of the Amended Stock Repurchase Program, the aggregate number of shares of the Company’s common stock under 2020 Program increases from up to 15 million shares to up to 25 million of the Company’s common stock.

A summary of share repurchases under the 2020 Program during the three months ended March 31, 2026 is as follows (in thousands, except share amounts):

As a result of the Amended Stock Repurchase Program, the aggregate number of shares of the Company’s common stock under the 2020 Program increased from up to 15 million shares to up to 25 million shares of the Company’s common stock.

A summary of share repurchases under the 2020 Program during the six months ended June 30, 2026 is as follows (in thousands, except share amounts):

Total number of shares repurchased Aggregate purchase price (1)

Shares remaining under repurchase authorization as of March 31, 2026

Shares remaining under repurchase authorization as of June 30, 2026

3,813,873 $168,617 7,669,154

(1) Includes the impact of excise taxes.

Cumulatively as of March 31, 2026, 14,703,059 shares have been repurchased under the 2020 Program, at an aggregate cost of $802.1 million (including excise tax).

Cumulatively as of June 30, 2026, 17,330,846 shares have been repurchased under the 2020 Program, at an aggregate cost of $923.9 million (including excise tax).

These shares were subsequently retired.

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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