MARCUS CORP

Previous wording

The second quarter of fiscal 2025 consisted of the three month period beginning on April 1, 2025 and ended on June 30, 2025 and included the same number of operating days compared to the prior year quarter. The second quarter of fiscal 2024 consisted of the three month period beginning March 29, 2024 and ended on June 27, 2024. The first half of fiscal 2025 consisted of the six month period beginning on December 27, 2024 and ended on June 30, 2025 and included four additional operating days compared to the prior year period. The first half of fiscal 2024 consisted of the six month period beginning on December 29, 2023 and ended on June 27, 2024.

Current wording

The third quarter of fiscal 2025 consisted of the three month period beginning on July 1, 2025 and ended on September 30, 2025 and included one additional operating day compared to the prior year quarter. The third quarter of fiscal 2024 consisted of the three month period beginning June 28, 2024 and ended on September 26, 2024. The first three quarters of fiscal 2025 consisted of the nine month period beginning on December 27, 2024 and ended on September 30, 2025 and included five additional operating days compared to the prior year period. The first three quarters of fiscal 2024 consisted of the nine month period beginning on December 29, 2023 and ended on September 26, 2024.

Previous wording

The following table sets forth revenues, operating income (loss), other income (expense), net earnings (loss) and net earnings (loss) per diluted common share for the second quarter and first half of fiscal 2025 and fiscal 2024 (in millions, except for per share and variance percentage data):

Current wording

The following table sets forth revenues, operating income, other income (expense), net earnings (loss) and net earnings (loss) per diluted common share for the third quarter and first three quarters of fiscal 2025 and fiscal 2024 (in millions, except for per share and variance percentage data):

Previous wording

Revenues increased and operating income (loss), net earnings (loss), and net earnings (loss) per diluted common share improved during the second quarter and first half of fiscal 2025 compared to the second quarter and first half of fiscal 2024 primarily due to increased revenues from our theatre division. Hotels and resorts division revenues during the second quarter of fiscal 2025 remained consistent with the second quarter of fiscal 2024, and increased during the first half of fiscal 2025 compared to the first half of fiscal 2024. Revenues in the first half of fiscal 2025 were favorably impacted by four additional operating days compared to the first half of fiscal 2024, which included two additional days during the week between the Christmas and New Year’s holidays and two additional days at the end of March 2025. The four additional operating days (which occurred during the fiscal 2025 first quarter) favorably impacted revenues by approximately $9.2 million.

Current wording

Revenues declined during the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024 due to decreased revenues from our theatre division, partially offset by increased revenues in our hotels and resorts division. The third quarter of fiscal 2025 included one additional operating day compared to the third quarter of fiscal 2024. Revenues increased during the first three quarters of fiscal 2025 compared to the first three quarters of fiscal 2024 due to increased revenues in both divisions. Revenues in the first three quarters of fiscal 2025 were favorably impacted by five additional operating days compared to the first three quarters of fiscal 2024. The four additional operating days, occurring during the fiscal 2025 first quarter, favorably impacted revenues by approximately $9.2 million. The additional operating day in the fiscal 2025 third quarter had an immaterial impact on results.

Previous wording

Operating income during the second quarter of fiscal 2025 increased $10.8 million primarily due to increased revenues in our Theatre division, and was unfavorably impacted by increased corporate expenses and an increase in depreciation expense of $0.9 million compared to the second quarter of fiscal 2024. Operating loss during the first half of fiscal 2025 improved $7.0 million compared to the first half of fiscal 2024 due to increased revenues in both divisions, and was negatively impacted by increased corporate expenses and increased depreciation expense of $2.7 million over the prior year period.

Current wording

Operating income during the third quarter of fiscal 2025 decreased $10.1 million primarily due to decreased revenues in our Theatre division, increased corporate expenses and an increase in depreciation expense of $0.4 million compared to the third quarter of fiscal 2024. Operating income during the first three quarters of fiscal 2025 declined $3.0 million compared to the first three quarters of fiscal 2024 due to increased corporate expenses and increased depreciation expense of $2.3 million, partially offset by increased operating income from our Theatre division compared to the prior year period.

Previous wording

Corporate expenses during the second quarter of fiscal 2025 increased $0.2 million compared to the second quarter of fiscal 2024 due to increases in depreciation expense, long-term incentive compensation expenses, professional fees, and personnel and benefits cost inflation, partially offset by a favorable $1.0 million decrease in non-cash stock compensation expense. Corporate expenses during the first half of fiscal 2025 increased $2.5 million compared to the first half of fiscal 2024 due to increases in depreciation, long-term incentive compensation expenses, professional fees related to tax, audit and legal services, and personnel and benefits cost inflation.

Current wording

Corporate expenses during the third quarter of fiscal 2025 decreased $0.1 million compared to the third quarter of fiscal 2024 due to a favorable $1.0 million decrease in non-cash stock compensation expense, partially offset by increases in depreciation expense, long-term incentive compensation expenses, professional fees, and personnel and benefits cost inflation. Corporate expenses during the first three quarters of fiscal 2025 increased $2.5 million compared to the first three quarters of fiscal 2024 due to increases in depreciation, long-term incentive compensation expenses, professional fees related to tax, audit and legal services, and personnel and benefits cost inflation.

Previous wording

In addition, operating income during the second quarter of fiscal 2025 was negatively impacted by a $0.2 million loss on disposition of property, equipment and other assets compared to an immaterial gain on disposition of property, equipment and other assets during the second quarter of fiscal 2024. Operating loss during the first half of fiscal 2025 was favorably impacted by a $1.2 million gain on disposition of property, equipment and other assets due largely to the sale of surplus land, compared to an immaterial gain during the first half of fiscal 2024.

Current wording

Operating income during the third quarter of fiscal 2025 was favorably impacted by a $0.1 million gain on disposition of property, equipment and other assets compared to a $0.1 million loss on disposition of property, equipment and other assets during the third quarter of fiscal 2024. Operating loss during the first three quarters of fiscal 2025 was favorably impacted by a $1.3 million gain on disposition of property, equipment and other assets largely due to the sale of surplus land, compared to a $0.1 million loss during the first three quarters of fiscal 2024.

Previous wording

Other income (expense) and net earnings (loss) during the second quarter and first half of fiscal 2025 were impacted by an increase in interest expense, fluctuations in investment income, and a decrease in debt conversion expense compared with the second quarter and first half of fiscal 2024.

Current wording

Other income (expense) and net earnings (loss) during the third quarter of fiscal 2025 were impacted by a decrease in interest expense, a decrease in investment income, an increase in other income primarily due to a $4.5 million gain from a property insurance settlement, and a decrease in debt conversion expense, compared with the third quarter of fiscal 2024. Other income (expense) and net earnings (loss) during the first three quarters of fiscal 2025 were impacted by an increase in interest expense, fluctuations in investment income, an increase in other income primarily due to a $4.5 million gain from a property insurance settlement, and a decrease in debt conversion expense, compared with the first three quarters of fiscal 2024.

Previous wording

Our interest expense totaled $3.0 million and $5.8 million for the second quarter and first half of fiscal 2025, respectively, compared to $2.6 million and $5.1 million for the second quarter and first half of fiscal 2024, respectively. The increase in interest expense during the second quarter and first half of fiscal 2025 was primarily due to increased borrowings and higher interest rates, partially offset by a decrease in non-cash amortization of deferred financing costs. Changes in our borrowing levels due to variations in our operating results, capital expenditures, acquisition opportunities (or the lack thereof) and asset sale proceeds, among other items, may impact, either favorably or unfavorably, our actual reported interest expense in future periods, as may changes in short-term interest rates.

Current wording

Our interest expense totaled $2.8 million and $8.6 million for the third quarter and first three quarters of fiscal 2025, respectively, compared to $3.1 million and $8.2 million for the third quarter and first three quarters of fiscal 2024, respectively. The decrease in interest expense during the third quarter of fiscal 2025 was primarily due to decreased borrowings and a decrease in non-cash amortization of deferred financing costs. The increase in interest expense during the first three quarters of fiscal 2025 was primarily due to increased borrowings and higher interest rates, partially offset by a decrease in non-cash amortization of deferred financing costs. Changes in our borrowing levels due to variations in our operating results, capital expenditures, acquisition opportunities (or the lack thereof) and asset sale proceeds, among other items, may impact, either favorably or unfavorably, our actual reported interest expense in future periods, as may changes in short-term interest rates.

Previous wording

We recognized investment income of $0.4 million and $0.5 million during the second quarter and first half of fiscal 2025, respectively, compared to $0.2 million and $0.9 million during the second quarter and first half of fiscal 2024, respectively. Variations in investment income were due to changes in the value of marketable securities.

Current wording

We recognized investment income of $0.0 million and $0.5 million during the third quarter and first three quarters of fiscal 2025, respectively, compared to $0.8 million and $1.7 million during the third quarter and first three quarters of fiscal 2024, respectively. Variations in investment income were due to changes in the value of marketable securities.

Previous wording

Other income (expense) and net earnings (loss) during the second quarter and first half of fiscal 2024 were negatively impacted by debt conversion expense of $13.9 million in connection with the $86.4 million aggregate principal amount of Convertible Notes Repurchases. See“2024 Convertible Senior Notes Repurchases”in the “Liquidity and Capital Resources” section of this MD&A for further discussion.

Current wording

Other income (expense) and net earnings (loss) were negatively impacted by debt conversion expense of $1.4 million and $15.3 million during the third quarter and first three quarters of fiscal 2024, respectively, in connection with the $99.9 million aggregate principal amount of Convertible Notes Repurchases. See“2024 Convertible Senior Notes Repurchases”in the “Liquidity and Capital Resources” section of this MD&A for further discussion.

Previous wording

Net earnings (loss) and net earnings (loss) per diluted common share improved during the second quarter and first half of fiscal 2025 compared to the second quarter and first half of fiscal 2024 resulting from an improvement in operating income (loss), and a decrease in other expense, which was negatively impacted by debt conversion expense of $13.9 million during the prior year comparable periods.

Current wording

Net earnings (loss) and net earnings (loss) per diluted common share improved during the first three quarters of fiscal 2025 compared to the first three quarters of fiscal 2024 resulting from a decrease in operating income, offset by an increase in other income (expense), which was favorably impacted by a $4.5 million gain on insurance settlement during the first three quarters of fiscal 2025. Net earnings (loss) and net earnings (loss) per diluted common share was negatively impacted by debt conversion expense of $15.3 million during the first three quarters of fiscal 2024.

Previous wording

We reported income tax expense of $2.7 million for the second quarter of fiscal 2025 compared to expense of $5.7 million during the second quarter of fiscal 2024. We reported income tax benefit of $4.6 million for the first half of fiscal 2025 compared to benefit of $1.7 million for the first half of fiscal 2024. Our fiscal 2025 first half effective income tax rate was 32.7% and was negatively impacted by excess compensation subject to deduction limitations. Our fiscal 2024 first half effective income tax rate was 4.9%, and was negatively impacted by nondeductible debt conversion expense resulting from the Convertible Notes Repurchases and a $1.1 million reduction in deferred tax assets resulting from the related termination of the Capped Call Transactions (combined negative impact of 7.5 percentage points) and excess compensation subject to deduction limitations. We anticipate that our effective income tax rate for fiscal 2025 may be in the 28% to 32% range, excluding any potential changes in federal or state income tax rates, valuation allowance adjustments or other one-time tax benefits. Our actual fiscal 2025 effective income tax rate may be different from our estimated quarterly rates depending upon actual facts and circumstances.

Current wording

We reported income tax expense of $8.0 million for the third quarter of fiscal 2025 compared to expense of $5.4 million during the third quarter of fiscal 2024. We reported income tax expense of $3.3 million for the first three quarters of fiscal 2025 compared to expense of $3.8 million for the first three quarters of fiscal 2024. Our fiscal 2025 first three quarters effective income tax rate was 33.2% and was negatively impacted by excess compensation subject to deduction limitations. The One Big Beautiful Bill Act (OBBBA), enacted on July 4, 2025, had an insignificant impact on our effective tax rate. We anticipate that our effective income tax rate for fiscal 2025 may be in the 32% to 34% range, excluding any potential changes in federal or state income tax rates, valuation allowance adjustments or other one-time tax benefits. Our actual fiscal 2025 effective income tax rate may be different from our estimated quarterly rates depending upon actual facts and circumstances.

Previous wording

The following table sets forth revenues, operating income (loss) and operating margin for our theatre division for the second quarter and first half of fiscal 2025 and fiscal 2024 (in millions, except for variance percentage and operating margin):

Current wording

The following table sets forth revenues, operating income and operating margin for our theatre division for the third quarter and first three quarters of fiscal 2025 and fiscal 2024 (in millions, except for variance percentage and operating margin):

Previous wording

The following table provides a further breakdown of the components of revenues for the theatre division for the second quarter and first half of fiscal 2025 and fiscal 2024 (in millions, except for variance percentage):

Current wording

The following table provides a further breakdown of the components of revenues for the theatre division for the third quarter and first three quarters of fiscal 2025 and fiscal 2024 (in millions, except for variance percentage):

Previous wording

According to data received from Comscore (a national box office reporting service for the theatre industry) and compiled by us to evaluate our fiscal 2025 second quarter and first half results, U.S. box office receipts increased 36.5% and 21.4% during our fiscal 2025 second quarter and first half, respectively, compared to our fiscal 2024 second quarter and first half, indicating that our increase in admission revenues for comparable theatres (excluding theatres closed during the past year) of 29.3% and 16.6% during the second quarter and first half of fiscal 2025 underperformed the industry by 7.2 and 4.8 percentage points, respectively. We believe our under performance in the second quarter and first half of fiscal 2025 was largely attributable to strategic pricing decisions made during the release of blockbuster films (we did not raise prices on most blockbuster films, unlike many national exhibitors) and our value promotions, resulting in lower average ticket price growth compared to other exhibitors. We believe our pricing strategies promote the affordability of moviegoing for customers at a variety of price points and will benefit our long-term theatre attendance. We believe our underperformance was also the result of an unfavorable film mix, with certain titles that were more appealing to audiences in other parts of the U.S. than in our Midwestern markets.

Current wording

Data received and compiled by us from Comscore also indicates that U.S. box office receipts increased 7.0% during the first three quarters of fiscal 2025 compared to the first three quarters of fiscal 2024, indicating that our increase of 2.4% in admission revenues for comparable theatres (excluding theatres closed during the past year) during the first three quarters of fiscal 2025 underperformed the industry by 4.6 percentage points. We believe our underperformance during the first three quarters of fiscal 2025 was attributable to strategic pricing decisions made during the release of blockbuster films during the first half of fiscal 2025 (we did not raise prices on most blockbuster films, unlike many national exhibitors) and our value promotions, resulting in lower average ticket price growth compared to other exhibitors. We believe our underperformance was also the result of an unfavorable film mix, with certain titles that were more appealing to audiences in other parts of the U.S. than our Midwestern markets.

Previous wording

Additional data received and compiled by us from Comscore indicates our admission revenues at comparable theatres during the second quarter and first half of fiscal 2025 represented approximately 2.8% and 2.9%, respectively, of the total admission revenues in the U.S. (commonly referred to as market share in our industry), compared to 3.0% during the both the second quarter and first half of fiscal 2024. Our goal is to outperform the industry, but our ability to do so in any given quarter will likely be partially dependent upon film mix, pricing strategies, weather and the competitive landscape in our markets.

Current wording

Additional data received and compiled by us from Comscore indicates our admission revenues at comparable theatres during both the third quarter and first three quarters of fiscal 2025 represented approximately 2.9% of the total admission revenues in the U.S. (commonly referred to as market share in our industry), compared to 3.1% and 3.0% during the third quarter and first three quarters of fiscal 2024, respectively. Our goal is to outperform the industry, but our ability to do so in any given quarter will likely be partially dependent upon film mix, pricing strategies, weather and the competitive landscape in our markets.

Previous wording

Total theatre attendance for our comparable theatres increased 26.7% during the second quarter of fiscal 2025 compared to the second quarter of fiscal 2024, which was attributable to a stronger film slate, higher box office performance from the top films, and an increase in the number of films released during second quarter of fiscal 2025 compared to the second quarter of fiscal 2024. During the second quarter of fiscal 2025, there were 32 wide-release films (films shown in over approximately 1,500 theatres in the U.S.) compared to 28 wide-release films during the second quarter of fiscal 2024. On a calendar quarter basis (April 1 through June 30), total theatre attendance for our comparable theatres increased 26.2% during the second quarter of 2025 compared to the second quarter of 2024.

Current wording

Total theatre attendance for our comparable theatres decreased 18.7% during the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024, which was attributable to lower box office performances from the top five films. During the third quarter of fiscal 2025, there were 32 wide-release films (films shown in over approximately 1,500 theatres in the U.S.) compared to 29 wide-release films during the third quarter of fiscal 2024. On a calendar quarter basis (July 1 through September 30), total theatre attendance for our comparable theatres decreased 17.7% during the third quarter of 2025 compared to the third quarter of 2024.

Previous wording

Total theatre attendance for our comparable theatres increased 17.8% during the first half of fiscal 2025 compared to the first half of fiscal 2024, resulting primarily from the stronger film slate in second quarter of fiscal 2025. In addition, our total theatre attendance during the first half of fiscal 2025 benefited from an increased number of operating days during the first quarter of fiscal 2025 compared to the first quarter of fiscal 2024 due to the transition of our fiscal quarter as described above. On a calendar quarter basis (January 1 through June 30), total theatre attendance for our comparable theatres increased 10.8% during first half of fiscal 2025 compared to the first half of fiscal 2024.

Current wording

Total theatre attendance for our comparable theatres increased 1.7% during the first three quarters of fiscal 2025 compared to the first three quarters of fiscal 2024, resulting primarily from the stronger film slate in the second quarter of fiscal 2025. In addition, our total theatre attendance during the first three quarters of fiscal 2025 benefited from an increased number of operating days during the first quarter of fiscal 2025 compared to the first quarter of fiscal 2024 due to the transition of our fiscal quarter as described above. On a calendar quarter basis (January 1 through September 30), total theatre attendance for our comparable theatres decreased 1.7% during first three quarters of fiscal 2025 compared to the first three quarters of fiscal 2024.

Previous wording

Our highest grossing films during the fiscal 2025 second quarter included A Minecraft Movie, Lilo & Stitch, Sinners, How to Train Your Dragon, and Thunderbolts*. Our top five films during our fiscal 2025 second quarter accounted for 59% of our total box office results, compared to 56% for the top five films during the second quarter of fiscal 2024, both expressed as a percentage of the total admission revenues for the relevant period. An increased concentration of blockbuster films during a given quarter often has the effect of increasing our film rental costs during the period, as generally the better a particular film performs, the greater the film rental cost tends to be as a percentage of box office receipts. As a result of a more concentrated film slate, our overall film cost as a percentage of admission revenues increased during the second quarter of fiscal 2025 compared to the same period in the prior fiscal year.

Current wording

Our highest grossing films during the fiscal 2025 third quarter included Superman, Jurassic World: Rebirth, The Fantastic Four: First Steps, The Conjuring: Last Rites, and Weapons. Our top five films during our fiscal 2025 third quarter accounted for 53% of our total box office results, compared to 66% for the top five films during the third quarter of fiscal 2024, both expressed as a percentage of the total admission revenues for the relevant period. An increased concentration of blockbuster films during a given quarter often has the effect of increasing our film rental costs during the period, as generally the better a particular film performs, the greater the film rental cost tends to be as a percentage of box office receipts. As a result of a less concentrated film slate, our overall film cost as a percentage of admission revenues decreased during the third quarter of fiscal 2025 compared to the same period in the prior fiscal year.

Previous wording

Our average ticket price increased 2.0% during the second quarter of fiscal 2025, compared to the second quarter of fiscal 2024. Our average ticket price during the second quarter of fiscal 2025 was favorably impacted by an increased percentage of ticket sales coming from premium large format (PLF) screens and a decrease in the percentage of attendance coming from Value Tuesday, partially offset by an unfavorable ticket mix with an increase in child attendance resulting from an increased number of family films during the quarter. Additionally, the average ticket price was negatively impacted by promotional pricing, including $7 Everyday Matinee for seniors and children that was introduced during the second quarter fiscal 2024. The overall change in average ticket price favorably impacted our admission revenues of our comparable theatres by $1.2 million during the second quarter of fiscal 2025 compared to the second quarter of fiscal 2024.

Current wording

Our average ticket price increased 3.6% during the third quarter of fiscal 2025, compared to the third quarter of fiscal 2024. Our average ticket price during the third quarter of fiscal 2025 was favorably impacted by an increased percentage of ticket sales coming from premium large format (PLF) screens and strategic pricing changes. These increases were partially offset by an unfavorable ticket mix, including an increase in the percentage of our attendance coming from Value Tuesday. The overall change in average ticket price favorably impacted our admission revenues of our comparable theatres by $2.0 million during the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024.

Previous wording

Our average ticket price decreased 1.1% during the first half of fiscal 2025, compared to the first half of fiscal 2024, resulting from the unfavorable impact of the $7 Everyday Matinee promotional offering for seniors and children and an unfavorable ticket mix with an increase in child attendance resulting from an increased number of family films, partially offset by the favorable impact of an increased percentage of ticket sales coming from premium large format (PLF) screens. The overall change in average ticket price unfavorably impacted our admission revenues of our comparable theatres by $1.1 million during the first half of fiscal 2025 compared to the first half of fiscal 2024.

Current wording

Our average ticket price increased 0.7% during the first three quarters of fiscal 2025, compared to the first three quarters of fiscal 2024, resulting from an increased percentage of ticket sales coming from premium large format (PLF) screens, and strategic pricing changes introduced during the third quarter of fiscal 2025, partially offset by the unfavorable impact of the Everyday Matinee promotional offering for seniors and children introduced during the second quarter of fiscal 2024. The overall change in average ticket price favorably impacted our admission revenues of our comparable theatres by $1.2 million during the first three quarters of fiscal 2025 compared to the first three quarters of fiscal 2024.

Previous wording

Our average concession revenues per person increased by 3.1% and 3.4% during the second quarter and first half of fiscal 2025, respectively, compared to the second quarter and first half of fiscal 2024, resulting from an increase in movie merchandise sales and menu price increases. The overall increase in average concession revenues per person favorably impacted our concession revenues of our comparable theatres by $1.9 million and $3.2 million during the second quarter and first half of fiscal 2025, respectively, compared to the second quarter and first half of fiscal 2024.

Current wording

Our average concession revenues per person increased by 2.1% and 2.9% during the third quarter and first three quarters of fiscal 2025, respectively, compared to the third quarter and first three quarters of fiscal 2024, resulting from an increase in movie merchandise sales and menu price increases. The overall increase in average concession revenues per person favorably impacted our concession revenues of our comparable theatres by $1.2 million and $4.4 million during the third quarter and first three quarters of fiscal 2025, respectively, compared to the third quarter and first three quarters of fiscal 2024.

Previous wording

Other revenues during the second quarter and first half of fiscal 2025 increased by $2.6 million and $4.2 million, respectively, compared to the second quarter and first half of fiscal 2024, due to the impact of increased attendance on internet surcharge ticketing fees and preshow and in-app advertising revenue. Late during the first quarter of fiscal 2024, we made changes to the criteria for waiving internet surcharge ticket fees for our MMR members, resulting in an increase in ticketing fees per person during most of the first quarter of fiscal 2025.

Current wording

Other revenues during the third quarter of fiscal 2025 decreased by $1.9 million compared to the third quarter of fiscal 2024, due to the impact of decreased attendance on internet surcharge ticketing fees and preshow and in-app advertising revenue, partially offset by an increase in average internet surcharge ticketing fees per person. Other revenues during the first three quarters of fiscal 2025 increased by $2.3 million compared to the first three quarters of fiscal 2024 due to the impact of increased attendance on internet surcharge ticketing fees and preshow and in-app advertising revenue, as well as an increase in average internet surcharge ticketing fees per person.

Previous wording

We ended the second quarter of fiscal 2025 with a total of 971 company-owned screens in 77 theatres and 14 managed screens at one theatre, compared to 981 company-owned screens in 78 theatres at the end of the second quarter of fiscal 2024. We made decisions to close underperforming theatres during fiscal 2024 and fiscal 2025, including one leased theatre in the second quarter of fiscal 2024, and one leased Movie Tavern theatre in the first quarter of fiscal 2025. During the third quarter of fiscal 2024, we added one theatre that we manage for the owner of a lifestyle shopping center.

Current wording

We ended the third quarter of fiscal 2025 with a total of 971 company-owned screens in 77 theatres and 14 managed screens at one theatre, compared to 981 company-owned screens in 78 theatres and 14 managed screens at one theatre at the end of the third quarter of fiscal 2024. We made decisions to close underperforming theatres during fiscal 2024 and fiscal 2025, including one leased theatre in the second quarter of fiscal 2024, and one leased Movie Tavern theatre in the first quarter of fiscal 2025. During the third quarter of fiscal 2024, we added one theatre that we manage for the owner of a lifestyle shopping center.

Previous wording

The following table sets forth revenues, operating income (loss) and operating margin for our hotels and resorts division for the second quarter and first half of fiscal 2025 and fiscal 2024 (in millions, except for variance percentage and operating margin):

Current wording

The following table sets forth revenues, operating income and operating margin for our hotels and resorts division for the third quarter and first three quarters of fiscal 2025 and fiscal 2024 (in millions, except for variance percentage and operating margin):

Previous wording

Hotels and resorts division revenues decreased 0.3% during the second quarter of fiscal 2025 compared to the second quarter of fiscal 2024. Division operating income during the second quarter of fiscal 2025 decreased $1.9 million compared to the second quarter of fiscal 2024, and was negatively impacted by an increase in depreciation expense of $1.7 million due to hotel renovations completed during fiscal 2024 as well as higher repair costs following a water damage event at one hotel. During the first half of fiscal 2025, hotels and resorts division revenues increased 3.0% and benefited from four additional operating days compared to the first half of fiscal 2024 (which occurred during the first quarter of fiscal 2025). Operating income (loss) declined $2.8 million during the first half of fiscal 2025, compared to the first half of fiscal 2024, due to a $3.6 million increase in depreciation expense partially offset by the favorable impact of the increase in revenues.

Current wording

During the first three quarters of fiscal 2025, hotels and resorts division revenues increased 2.4% and benefited from five additional operating days compared to the first three quarters of fiscal 2024 (four of which occurred during the first quarter of fiscal 2025 and one occurring during the third quarter of fiscal 2025). Operating income declined $3.5 million during the first three quarters of fiscal 2025, compared to the first three quarters of fiscal 2024, due to a $4.1 million increase in depreciation expense partially offset by the favorable impact of the increase in revenues.

Previous wording

The following table provides a further breakdown of the components of revenues for the hotels and resorts division for the second quarter and first half of fiscal 2025 and fiscal 2024 (in millions, except for variance percentage):

Current wording

The following table provides a further breakdown of the components of revenues for the hotels and resorts division for the third quarter and first three quarters of fiscal 2025 and fiscal 2024 (in millions, except for variance percentage):

Previous wording

Division total revenues before cost reimbursements increased 1.2% during the second quarter of fiscal 2025, compared to the second quarter of fiscal 2024, due largely to increased group demand contributing to growth in food and beverage revenues, partially offset by a decrease in rooms revenue which was negatively impacted by rooms out of service due to the renovation of the Hilton Milwaukee, as well as lower transient demand at some properties. Division total revenues before cost reimbursements increased 4.5% during the first half of fiscal 2025, compared to the first half of fiscal 2024, resulting primarily from an additional four operating days, growth in food and beverage revenues, as well as an increase in other revenues driven primarily by a group buyout of one condo hotel property during a portion of the first quarter, partially offset by the negative impact of the Hilton Milwaukee renovation.

Current wording

Division total revenues before cost reimbursements increased 1.7% during the third quarter of fiscal 2025, compared to the third quarter of fiscal 2024, due to growth in food and beverage revenues driven by strong group business and increased occupancy at six of our seven owned hotels. Division total revenues before cost reimbursements increased 3.4% during the first three quarters of fiscal 2025, compared to the first three quarters of fiscal 2024, resulting primarily from an additional five operating days, growth in food and beverage revenues, as well as an increase in other revenues driven primarily by a group buyout of one condo hotel property during a portion of the first quarter, partially offset by the negative impact of the Hilton Milwaukee renovation.

Previous wording

The following table sets forth certain operating statistics for the second quarter and first half of fiscal 2025 and fiscal 2024, including our average occupancy percentage (number of occupied rooms as a percentage of available rooms), our average daily room rate, or ADR, and our total revenue per available room, or RevPAR, for comparable company-owned properties:

Current wording

The following table sets forth certain operating statistics for the third quarter and first three quarters of fiscal 2025 and fiscal 2024, including our average occupancy percentage (number of occupied rooms as a percentage of available rooms), our average daily room rate, or ADR, and our total revenue per available room, or RevPAR, for comparable company-owned properties:

Previous wording

RevPAR increased at four of our seven comparable company-owned properties during the second quarter of fiscal 2025 compared to the second quarter of fiscal 2024, driven primarily by increased average daily rates. Group business grew as a percentage of our mix of business, representing approximately 47.1% of our total rooms revenue in the second quarter of fiscal 2025, compared to approximately 44.6% during the second quarter of fiscal 2024. Non-group pricing increased in some of our major markets during the second quarter of fiscal 2025, primarily due to increased rate compression at our other Milwaukee market hotels as a result of the renovation at the Hilton Milwaukee.

Current wording

RevPAR decreased at six of our seven comparable company-owned properties during the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024, driven mainly by decreased average daily rates which were significantly higher at our three Milwaukee hotels in the prior year due to the impact of the RNC. Group business as a percentage of our mix of business represented approximately 42.5% of our total rooms revenue in the third quarter of fiscal 2025, compared to approximately 47.3% during the third quarter of fiscal 2024 which included higher group business due to the RNC. Non-group pricing increased in some of our major markets during the third quarter of fiscal 2025, primarily due to increased leisure demand.

Previous wording

According to data received from Smith Travel Research and compiled by us in order to evaluate our fiscal 2025 second quarter and first half results, comparable “upper upscale” hotels—hotels identified as our industry— throughout the United States experienced flat RevPAR during our fiscal 2025 second quarter compared to our fiscal 2024 second quarter, leading us to believe we underperformed the industry during the fiscal 2025 second quarter by approximately 2.9 percentage points. During the first half of fiscal 2025, comparable “upper upscale” hotels experienced RevPAR growth of 1.3%, compared to the first half of fiscal 2024, leading us to believe we underperformed the industry during the first half of fiscal

Current wording

According to data received from Smith Travel Research and compiled by us in order to evaluate our fiscal 2025 third quarter and first three quarters results, comparable “upper upscale” hotels—hotels identified as our industry— throughout the United States experienced a decrease in RevPAR of 1.3% during our fiscal 2025 third quarter compared to our fiscal 2024 third quarter, leading us to believe we slightly underperformed the industry during the fiscal 2025 third quarter by approximately 0.2 percentage points. We believe our underperformance during the third quarter was largely driven by the nonrecurring favorable impact of the RNC on the third quarter of fiscal 2024 which disproportionately affected our largest market and was not observed in other parts of the country. During the first three quarters of fiscal 2025, comparable “upper upscale” hotels experienced RevPAR growth of 0.3%, compared to the first three quarters of fiscal 2024, leading us to believe we underperformed the industry during the first three quarters of fiscal 2025 by approximately 2.1 percentage points. We believe our underperformance during the first three quarters of fiscal 2025 resulted primarily from the unfavorable impact of the Hilton Milwaukee renovation and group displacement as a result of the reduced capacity during the first half of fiscal 2025. We estimate that the Hilton Milwaukee renovation negatively impacted our RevPAR growth by approximately 2.0 percentage points during the first three quarters of fiscal 2025.

Previous wording

Data received from Smith Travel Research for our various “competitive sets”—hotels identified in our specific markets that we deem to be competitors to our hotels—indicates that these hotels experienced an increase in RevPAR of 2.9% during our fiscal 2025 second quarter, again compared to our fiscal 2024 second quarter. Therefore, we underperformed our competitive sets during the second quarter of fiscal 2025 by approximately 5.8 percentage points. During the first half of fiscal 2025, hotels in our competitive sets experienced RevPAR growth of 3.6%, indicating that we underperformed our competitive set hotels by 5.5 percentage points. We believe the underperformance to our competitive sets during the second quarter and first half of fiscal 2025 resulted primarily from group displacement at the Hilton Milwaukee while under renovation which we believe unfavorably impacted our RevPAR growth while favorably impacting competitive hotels RevPAR growth. After adjusting for the estimated impact of the Hilton Milwaukee renovation, we believe our hotels underperformed their competitive sets during the second quarter and first half of fiscal 2025 by approximately 1.3 and 1.0 percentage points, respectively. We believe this underperformance was driven largely by new hotel room supply within one of our markets.

Current wording

Data received from Smith Travel Research for our various “competitive sets”—hotels identified in our specific markets that we deem to be competitors to our hotels—indicates that these hotels experienced a decrease in RevPAR of 6.7% during our fiscal 2025 third quarter, again compared to our fiscal 2024 third quarter. Therefore, we outperformed our competitive sets during the third quarter of fiscal 2025 by approximately 5.2 percentage points. We believe our outperformance to our competitive sets during the third quarter of fiscal 2025 resulted primarily from strong performance in our group customer segment, coupled with a strong summer golf season at Grand Geneva Resort & Spa. During the first three quarters of fiscal 2025, hotels in our competitive sets experienced a decrease in RevPAR of 1.6%, indicating that we slightly underperformed our competitive set hotels by 0.2 percentage points. We believe the underperformance to our competitive sets during the first three quarters of fiscal 2025 resulted primarily from group displacement at the Hilton Milwaukee while under renovation during the first half of fiscal 2025, which we believe unfavorably impacted our RevPAR growth while favorably impacting competitive hotels RevPAR growth. After adjusting for the estimated impact of the Hilton Milwaukee renovation, we believe our hotels outperformed their competitive sets during the first three quarters of fiscal 2025 by approximately 2.1 percentage point.

Previous wording

We generally expect our revenue trends to track or exceed the overall industry trends for our segment of the industry, particularly in our respective markets. Hotel revenues have historically tracked very closely with traditional macroeconomic statistics, such as the Gross Domestic Product. The U.S. economic outlook has moved into a period of heightened uncertainty. In the near term, we expect leisure travel demand to soften, and we expect our group business to remain stable. Leisure travel in our markets has a seasonal component, peaking in the summer months and slowing down as children return to school and the weather turns colder in our primarily Midwestern markets.

Current wording

We generally expect our revenue trends to track or exceed the overall industry trends for our segment of the industry, particularly in our respective markets. Hotel revenues have historically tracked very closely with traditional macroeconomic statistics, such as the Gross Domestic Product. The U.S. economic outlook remains in a period of heightened uncertainty. In the near term, we expect business travel demand to soften, and we expect our group business to remain stable. Leisure travel demand has softened in the midscale and economy segments of the market, while generally remaining stable in the upper upscale segment of the market that includes most of our properties. Leisure travel in our markets has a seasonal component, peaking in the summer months and slowing down as children return to school and the weather turns colder in our primarily Midwestern markets.

Previous wording

As of the date of this report, our group room revenue bookings for the remainder of fiscal 2025 - commonly referred to in the hotels and resorts industry as “group pace” - is running in-line with where we were at the same time last year, and is running approximately 11% ahead of where we were at the same time last year excluding bookings related to the July 2024 Republican National Convention. Group room revenue bookings for fiscal 2026 is running nearly 20% ahead of where we were at the same time in fiscal 2024 for fiscal 2025. Banquet and catering revenue pace for fiscal 2025 is running approximately 15% ahead of where we were at the same time last year, and fiscal 2026 is running approximately 20% ahead of where we were at the same time in fiscal 2024 for fiscal 2025.

Current wording

As of the date of this report, our group room revenue bookings for fiscal 2025 - commonly referred to in the hotels and resorts industry as “group pace” - is running approximately 4% behind where we were at the same time last year. Group room revenue bookings for fiscal 2026 is running approximately 14% ahead of where we were at the same time in fiscal 2024 for fiscal 2025. Banquet and catering revenue pace for fiscal 2025 is running approximately 14% ahead of where we were at the same time last year. Banquet and catering revenue pace for fiscal 2026 is running approximately 13% ahead of where we were at the same time in fiscal 2024 for fiscal 2025.

Previous wording

We define Adjusted EBITDA as net earnings (loss) attributable to The Marcus Corporation before investment income or loss, interest expense, other expense, gain or loss on disposition of property, equipment and other assets, impairment charges, equity earnings or losses from unconsolidated joint ventures, net earnings or losses attributable to noncontrolling interests, income taxes, depreciation and amortization and non-cash share-based compensation expense, adjusted to eliminate the impact of certain items that we do not consider indicative of our core operating performance. These further adjustments are itemized below. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating Adjusted EBITDA, you should be aware that in the future we will incur expenses that are the same as or similar to some of the items eliminated in the adjustments made to determine

Current wording

We define Adjusted EBITDA as net earnings (loss) attributable to The Marcus Corporation before investment income or loss, interest expense, other expense, gain or loss on disposition of property, equipment and other assets, impairment charges, equity earnings or losses from unconsolidated joint ventures, net earnings or losses attributable to noncontrolling interests, income taxes, depreciation and amortization and non-cash share-based compensation expense, adjusted to eliminate the impact of certain items that we do not consider indicative of our core operating performance. These further adjustments are itemized below. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating Adjusted EBITDA, you should be aware that in the future we will incur expenses that are the same as or similar to some of the items eliminated in the adjustments made to determine Adjusted EBITDA, such as acquisition expenses, preopening expenses, accelerated depreciation, impairment charges and other adjustments. Our presentation of Adjusted EBITDA should not be construed to imply that our future results will be unaffected by any such adjustments. Definitions and calculations of Adjusted EBITDA differ among companies in our industries, and therefore Adjusted EBITDA disclosed by us may not be comparable to the measures disclosed by other companies.

Previous wording

The following table sets forth Adjusted EBITDA by reportable operating segment for the second quarter and first halfof fiscal 2025 and fiscal 2024 (in millions, except for variance percentage):

Current wording

The following table sets forth Adjusted EBITDA by reportable operating segment for the third quarter and first three quarters of fiscal 2025 and fiscal 2024 (in millions, except for variance percentage):

Previous wording

Our theatre division Adjusted EBITDA increased during the second quarter of fiscal 2025 compared to the second quarter of fiscal 2024 due to increased revenues and increased operating leverage with the higher volumes, partially offset by increases in film costs, advertising costs, facility maintenance and other expenses. Our hotels and resorts division Adjusted EBITDA decreased during the second quarter of fiscal 2025 compared to the second quarter of fiscal 2024 and was negatively impacted by changes in revenue mix, with a decrease in higher margin rooms revenue offset by an increase in lower margin food and beverage revenue, as well as higher repair costs following a water damage event at one hotel and higher associate benefits costs. Adjusted EBITDA attributable to corporate items decreased during the second quarter of fiscal 2025 compared to the second quarter of fiscal 2024 due primarily to increased long-term incentive compensation expenses as well as personnel and benefits cost inflation, partially offset by a decrease in professional fees related to legal services.

Current wording

Our theatre division Adjusted EBITDA decreased during the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024 due to decreased revenues and less operating leverage with the lower attendance, partially offset by decreases in film costs. Our hotels and resorts division Adjusted EBITDA increased slightly during the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024 and was negatively impacted by changes in revenue mix, with higher margin rooms revenue remaining effectively flat and lower margin food and beverage revenue increasing. Adjusted EBITDA attributable to corporate items decreased during the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024 due primarily to increased long-term incentive compensation expenses, personnel and benefits cost inflation, recruiting fees and an increase in professional fees.

Previous wording

During the first half of fiscal 2025, theatre division Adjusted EBITDA increased compared to the first half of fiscal 2024, due to higher revenue resulting from increased attendance and four additional operating days in the fiscal 2025 first quarter, as described above, partially offset by increased film costs and labor expenses. Our hotels and resorts Adjusted EBITDA increased during the first half of fiscal 2025 compared to the first half of fiscal 2024 due to higher revenue resulting from additional operating days and an increase in group business, partially offset by increased associate benefits costs and repair costs. Adjusted EBITDA attributable to corporate items decreased during the first half of fiscal 2025 compared to the first half of fiscal 2024 due primarily to increased long-term incentive compensation expenses, professional fees related to tax, audit, and legal services, and personnel and benefits cost inflation.

Current wording

During the first three quarters of fiscal 2025, theatre division Adjusted EBITDA decreased compared to the first three quarters of fiscal 2024, due to increases in labor expenses, benefits costs, and maintenance expenses, partially offset by the favorable impact of higher revenue, including the impact of four additional operating days in the fiscal 2025 first quarter and one additional operating day in the fiscal 2025 third quarter, as described above. Our hotels and resorts Adjusted EBITDA increased during the first three quarters of fiscal 2025 compared to the first three quarters of fiscal 2024 due to higher revenue resulting from additional operating days and an increase in group business, partially offset by increased associate benefits and maintenance costs. Adjusted EBITDA attributable to corporate items decreased during the first three quarters of fiscal 2025 compared to the first three quarters of fiscal 2024 due primarily to increased long-term incentive compensation expenses, professional fees related to tax, audit, and legal services, personnel and benefits cost inflation, and recruiting fees.

Previous wording

(1)Non-cash expense related to share-based compensation programs.

Current wording

(2)Non-cash expense related to share-based compensation programs.

Previous wording

(2)Non-cash impairment charges related to one permanently closed theatre location in the second quarter of fiscal 2024.

Current wording

(3)Non-cash impairment charges related to one permanently closed theatre location in the second quarter of fiscal 2024.