Vivid Seats Inc

Previous wording

We are an online ticket marketplace that utilizes our technology platform to connect fans of live events seamlessly with ticket sellers. Our mission is to empower and enable fans to Experience It Live. We believe in the power of shared experiences to connect people with live events delivering some of life’s most exciting moments. We operate a technology platform and marketplace that enables ticket buyers to easily discover and purchase tickets to live events and attractions and book hotel rooms and packages, while enabling ticket sellers and partners to seamlessly manage their operations. We differentiate from competitors by offering an extensive breadth and depth of ticket listings at a competitive value. The following table summarizes our Marketplace Gross Order Value (“Marketplace GOV”), revenues, net income and Adjusted EBITDA for the three months ended March 31, 2024 and 2023 (in thousands):

Current wording

We are an online ticket marketplace that utilizes our technology platform to connect fans of live events seamlessly with ticket sellers. Our mission is to empower and enable fans to Experience It Live. We believe in the power of shared experiences to connect people with live events delivering some of life’s most exciting moments. We operate a technology platform and marketplace that enables ticket buyers to easily discover and purchase tickets to live events and attractions and book hotel rooms and packages, while enabling ticket sellers and partners to seamlessly manage their operations. We differentiate from competitors by offering an extensive breadth and depth of ticket listings at a competitive value. The following table summarizes our Marketplace Gross Order Value (“Marketplace GOV”), revenues, net income (loss) and Adjusted EBITDA for the three and six months ended June 30, 2024 and 2023 (in thousands):

Previous wording

Marketplace GOV represents the total transactional amount of Marketplace segment orders placed on our platform in a period, inclusive of fees, exclusive of taxes and net of cancellations that occurred during that period. During the three months ended March 31, 2024, Marketplace GOV was negatively impacted by cancellations in the amount of $18.3 million compared to $12.1 million during the three months ended March 31, 2023.

Current wording

Marketplace GOV represents the total transactional amount of Marketplace segment orders placed on our platform in a period, inclusive of fees, exclusive of taxes and net of cancellations that occurred during that period. During the three and six months ended June 30, 2024, Marketplace GOV was negatively impacted by cancellations in the amount of $21.2 million and $39.4 million, respectively, compared to $11.7 million and $23.8 million during the three and six months ended June 30, 2023, respectively.

Previous wording

Total Marketplace orders represents the volume of Marketplace segment orders placed on our platform in a period, net of cancellations that occurred during that period. During the three months ended March 31, 2024, our Marketplace segment experienced 50,049 cancellations compared to 20,480 cancellations during the three months ended March 31, 2023.

Current wording

Total Marketplace orders represents the volume of Marketplace segment orders placed on our platform in a period, net of cancellations that occurred during that period. During the three and six months ended June 30, 2024, our Marketplace segment experienced 52,392 and 102,441 cancellations, respectively, compared to 29,351 and 49,831 cancellations during the three and six months ended June 30, 2023, respectively.

Previous wording

Total Resale orders represents the volume of Resale segment orders in a period, net of cancellations that occurred during that period. During the three months ended March 31, 2024, our Resale segment experienced 872 cancellations compared to 685 cancellations during the three months ended March 31, 2023.

Current wording

Total Resale orders represents the volume of Resale segment orders in a period, net of cancellations that occurred during that period. During the three and six months ended June 30, 2024, our Resale segment experienced 1,211 and 2,083 cancellations, respectively, compared to 827 and 1,512 cancellations during the three and six months ended June 30, 2023, respectively.

Previous wording

Marketplace GOV increased during the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily as a result of an increase in the number of orders processed, which for the three months ended March 31, 2024 included orders processed through Vegas.com and Wavedash.

Current wording

Marketplace GOV increased during the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023 primarily as a result of an increase in Total Marketplace orders.

Previous wording

Total Marketplace orders represents the volume of Marketplace segment orders placed on our platform in a period, net of cancellations that occurred during that period. An order can include one or more tickets, hotel rooms or parking passes. Total Marketplace orders allows us to monitor order volume and better identify trends within our Marketplace segment. Total Marketplace orders increased during the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily as a result of an increase in the number of orders processed, which for the three months ended March 31, 2024 included orders processed through Vegas.com and Wavedash.

Current wording

Total Marketplace orders represents the volume of Marketplace segment orders placed on our platform in a period, net of cancellations that occurred during that period. An order can include one or more tickets, hotel rooms or parking passes. Total Marketplace orders allows us to monitor order volume and better identify trends within our Marketplace segment. Total Marketplace orders increased during the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023 primarily as a result of an increase in the number of orders processed, which was due in part to the three and six months ended June 30, 2024 including orders processed through Vegas.com and Wavedash.

Previous wording

Total Resale orders represents the volume of Resale segment orders in a period, net of cancellations that occurred during that period. An order can include one or more tickets or parking passes. Total Resale orders allows us to monitor order volume and better identify trends within our Resale segment. Total Resale orders increased during the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily as a result of higher activity in our Resale segment.

Current wording

Total Resale orders represents the volume of Resale segment orders in a period, net of cancellations that occurred during that period. An order can include one or more tickets or parking passes. Total Resale orders allows us to monitor order volume and better identify trends within our Resale segment. Total Resale orders increased during the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023 primarily as a result of higher activity in our Resale segment.

Previous wording

The following table provides a reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure, net income (in thousands):

Current wording

The following table provides a reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure, net income (loss) (in thousands):

Previous wording

We have historically incurred sales tax expense in jurisdictions where we expected to collect and remit indirect taxes, but were not yet collecting from customers. In the first quarter of 2024, we settled certain liabilities for local admissions taxes for less than our estimated liability recorded as of December 31, 2023.

Current wording

We have historically incurred sales tax expense in jurisdictions where we expected to collect and remit indirect taxes, but were not yet collecting from customers. During the six months ended June 30, 2024, we accrued for additional sales and indirect tax liabilities in jurisdictions where we are not yet collecting from the customers and settled certain local admission tax liabilities for less than the amount that was accrued as of December 31, 2023.

Previous wording

Consists of legal, accounting, tax and other professional fees; personnel-related costs, which consist of retention bonuses; and integration costs. Transaction costs in both periods were primarily related to our acquisitions and strategic investments.

Current wording

Relates to legal, accounting, tax and other professional fees; personnel-related costs, which consist of retention bonuses; integration costs; and other transaction-related expenses. Costs in the three and six months ended June 30, 2024 primarily related to the refinancing of the February 2022 First Lien Loan with the June 2024 First Lien Loan (each as defined herein), share repurchases, acquisitions and strategic investments. Costs in the three and six months ended June 30, 2023 primarily related to a secondary offering of our Class A common stock, acquisitions and strategic investments.

Previous wording

Relates to profits interests issued prior to our merger transaction with Horizon Acquisition Corporation (the “Merger Transaction”) and equity granted pursuant to our 2021 Incentive Award Plan, as amended (the “2021 Plan”), which are not considered indicative of our core operating performance.

Current wording

Relates to equity granted pursuant to our 2021 Incentive Award Plan, as amended, and profits interests issued prior to our merger transaction with Horizon Acquisition Corporation (the “Merger Transaction”), neither of which are considered indicative of our core operating performance.

Previous wording

During the three months ended March 31, 2024, there were no material changes to the “Key Factors Affecting Our Performance” disclosed in our 2023 Form 10-K. Our financial position and results of operations depend to a significant extent on those factors.

Current wording

During the six months ended June 30, 2024, there were no material changes to the “Key Factors Affecting Our Performance” disclosed in our 2023 Form 10-K. Our financial position and results of operations depend to a significant extent on those factors.

Previous wording

Comparison of the Three Months Ended March 31, 2024 and 2023

Current wording

Comparison of the Three and Six Months Ended June 30, 2024 and 2023

Previous wording

Total revenues increased $29.8 million, or 18%, during the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase, which occurred in both our Marketplace and Resale segments, resulted primarily from an increase in orders processed.

Current wording

Total revenues increased $32.9 million, or 20%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased $62.7 million, or 19%, during the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase, which occurred in both our Marketplace and Resale segments, resulted primarily from an increase in orders processed, which was due in part to the three and six months ended June 30, 2024 including orders processed through Vegas.com and Wavedash.

Previous wording

Marketplace revenues increased $23.4 million, or 17%, during the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase resulted primarily from an increase in the number of orders processed, particularly for theater events, and that the three months ended March 31, 2024 included orders processed through Vegas.com and Wavedash.

Current wording

Total Marketplace orders increased 0.5 million, or 18%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased 1.1 million, or 22%, during the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase resulted primarily from an increase in the number of orders processed, particularly for theater events, which was due in part to the three and six months ended June 30, 2024 including orders processed through Vegas.com and Wavedash.

Previous wording

The increase in revenue from Owned Properties during the three months ended March 31, 2024 compared to the three months ended March 31, 2023 resulted primarily from an increase in the number of orders processed and that the three months ended March 31, 2024 included orders processed through Vegas.com and Wavedash.

Current wording

The increase in Owned Properties revenues during the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023 resulted primarily from an increase in the number of orders processed, which was due in part to the three and six months ended June 30, 2024 including orders processed through Vegas.com and Wavedash.

Previous wording

The decrease in revenue from Private Label during the three months ended March 31, 2024 compared to the three months ended March 31, 2023 resulted primarily from the negative impact to revenue of customer credit breakage, which more than offset an increase in revenue from higher order volumes.

Current wording

The decrease in Private Label revenues during the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023 resulted primarily from the negative impact to revenue of decreased customer credit breakage.

Previous wording

In our Marketplace segment, we also earn referral fee revenue by offering event ticket insurance to ticket buyers using a third-party insurance provider. Our referral fee revenue was $6.8 million and $7.2 million during the three months ended March 31, 2024 and 2023, respectively. The decrease was primarily due to a decline in the insurance attachment rate to orders.

Current wording

In our Marketplace segment, we also earn referral fee revenue by offering event ticket insurance to ticket buyers using a third-party insurance provider. Our referral fee revenue was $6.8 million and $13.6 million during the three and six months ended June 30, 2024, respectively, and $7.4 million and $14.6 million during the three and six months ended June 30, 2023, respectively. The decrease was primarily due to a decline in the insurance attachment rate to orders.

Previous wording

Resale revenues increased $6.4 million, or 26%, during the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase resulted primarily from higher order volume.

Current wording

Total Resale orders increased less than 0.1 million, or 33%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased less than 0.1 million, or 23%, during the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase resulted primarily from higher order volume.

Previous wording

Cancellation charges, which are classified as a reduction to revenues, negatively impacted Resale revenues by $0.3 million for the three months ended March 31, 2024 compared to $0.5 million for the three months ended March 31, 2023. The decrease resulted primarily from fewer cancellations.

Current wording

Cancellation charges, which are classified as a reduction to revenues, negatively impacted Resale revenues by $0.5 million and $0.8 million for the three and six months ended June 30, 2024, respectively, compared to $0.2 million and $0.7 million for the three and six months ended June 30, 2023, respectively. The increase for both periods was due to a higher number of cancelled orders.

Previous wording

Total cost of revenues increased $11.8 million, or 31%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase resulted primarily from higher revenues in both our Marketplace and Resale segments.

Current wording

Total cost of revenues increased $6.2 million, or 14%, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased $18.0 million, or 22%, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase resulted primarily from higher order volume in both our Marketplace and Resale segments.

Previous wording

Marketplace cost of revenues increased $6.1 million, or 30%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase was relatively consistent with the 20% increase in Marketplace GOV for the same period.

Current wording

Marketplace cost of revenues increased $2.4 million, or 11%, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased $8.5 million, or 20%, for the six months ended June 30, 2024 compared to the three months ended June 30, 2023. The increase was relatively consistent with the increase in Marketplace GOV, which increased by 5% and 12% during the same respective periods.

Previous wording

Resale cost of revenues increased $5.7 million, or 32%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase was relatively consistent with the 26% increase in Resale revenues for the same period.

Current wording

Resale cost of revenues increased $3.8 million, or 19%, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased $9.5 million, or 25%, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase was not consistent with the increase in Resale revenues, which increased by 8% and 17% during the same respective periods, due to certain event categories with lower margins.

Previous wording

Marketing and selling expenses, which are entirely attributable to our Marketplace segment, increased $13.0 million, or 24%, during the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase primarily resulted from greater spending on online advertising, which increased by $12.8 million, or 26%, during the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase in spending on online advertising was relatively consistent with the 20% increase in Marketplace GOV over the same period as we scaled advertising to higher volumes, including volume associated with Vegas.com and Wavedash.

Current wording

Marketing and selling expenses, which are entirely attributable to our Marketplace segment, increased $4.9 million, or 8%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased $17.9 million, or 15%, during the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase primarily resulted from greater spending on online advertising, which increased by $5.0 million, or 9%, during the three months ended June 30, 2024 compared to the three and six months ended June 30, 2023 and increased by $17.8 million, or 16%, during the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase in spending on online advertising was primarily driven by an increase in performance marketing channel spend to support growth, and was relatively consistent with the increase in Marketplace GOV, which increased by 5% and 12% during the same respective periods.

Previous wording

Total general and administrative expenses increased $10.0 million, or 31%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase was primarily due to higher personnel expenses from higher employee headcount, including headcount added through our acquisitions of Vegas.com and Wavedash, and from higher equity-based compensation expense. Higher professional fees, including those incurred with our acquisitions of Vegas.com and Wavedash, are reflected in other expenses and also contributed to the increase.

Current wording

Total general and administrative expenses increased $22.8 million, or 59%, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased $32.7 million, or 46%, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase was primarily due to higher personnel expenses from higher equity-based compensation expense, particularly Hoya Topco’s repurchase and cancellation (using its own funds) of all of its outstanding profits interests and phantom units held by our employees (as discussed in Note 18, Equity-Based Compensation, to our condensed consolidated financial statements included elsewhere in this Report), and higher employee headcount, including headcount added through our acquisitions of Vegas.com and Wavedash. Non-income tax expense increased as a result of accruing for sales and indirect taxes in jurisdictions where we believe it is probable we should remit but have not yet collected from customers. The increase in other expenses for the six months ended June 30, 2024 as compared to the six months ended June 30, 2023 was primarily driven by higher computer and telecom expenses and higher office expenses, including those related to our acquisitions of Vegas.com and Wavedash.

Previous wording

Depreciation and amortization expenses increased $7.9 million, or 304%, during the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase was primarily due to the intangibles acquired as part of our acquisitions of Vegas.com and Wavedash and, to a lesser extent, an increase in capitalized development activities related to our platform. The magnitude of the increase attributable to the amortization of acquired intangibles had a significant impact on net income for the three months ended March 31, 2024 compared to the three months ended March 31, 2023.

Current wording

Depreciation and amortization expenses increased $7.8 million, or 288%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased $15.7 million, or 296%, during the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase was primarily due to the intangibles acquired as part of our acquisitions of Vegas.com and Wavedash and, to a lesser extent, an increase in capitalized development activities related to our platform.

Previous wording

Interest expense increased $1.8 million, or 55%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase was primarily due to higher interest rates, partially offset by interest earned on cash balances.

Current wording

Interest expense increased $2.6 million, or 92%, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased $4.4 million, or 72%, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase was primarily due to lower interest income earned on cash balances.

Previous wording

Other (income) expense increased $2.9 million, or 890%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase was primarily due to the fair value remeasurement of warrants, net of foreign currency revaluation losses due to unrealized gains arising from the remeasurement of non-operating assets and liabilities denominated in non-functional currencies on the balance sheet date.

Current wording

Other expense increased $2.2 million, or 220%, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased $5.1 million, or 759%, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase was primarily due to the due to the refinancing of the February 2022 First Lien Loan with the June 2024 First Lien Loan on June 14, 2024 and the fair value remeasurement of warrants, net of foreign currency revaluation losses due to unrealized gains arising from the remeasurement of non-operating assets and liabilities denominated in non-functional currencies on the balance sheet date.

Previous wording

Income tax expense increased $2.0 million during the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase was primarily due to our valuation allowance on our U.S. net operating losses, interest limitations and tax credit carryforwards as of March 31, 2023 that resulted in recording minimal income tax expense in the first quarter of 2023. The valuation allowance was subsequently released in the second quarter of 2023.

Current wording

Income tax expense increased $25.1 million during the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and increased $27.1 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase was primarily due to the June 30, 2023 release of our previously recorded valuation allowance on our U.S. tax attributes carryforward deferred tax assets.

Previous wording

Our primary source of funds is cash generated from operations. Our existing cash and cash equivalents are sufficient to fund our liquidity needs for the next 12 months and thereafter for the foreseeable future. As of March 31, 2024, we had $154.0 million of cash and cash equivalents, which consist of interest-bearing deposit accounts, money market accounts managed by financial institutions and highly liquid investments with maturities of three months or less. For the three months ended March 31, 2024, we generated positive cash flows from our operating activities.

Current wording

Our primary source of funds is cash generated from operations. Our existing cash and cash equivalents are sufficient to fund our liquidity needs for the next 12 months and thereafter for the foreseeable future. As of June 30, 2024, we had $234.3 million of cash and cash equivalents, which consist of interest-bearing deposit accounts, money market accounts managed by financial institutions and highly liquid investments with maturities of three months or less. For the six months ended June 30, 2024, we generated positive cash flows from our operating activities.

Previous wording

On June 30, 2017, we entered into a $575.0 million first lien debt facility, which included a $525.0 million term loan (the “June 2017 First Lien Term Loan”). We had an outstanding loan balance of $465.7 million under the June 2017 First Lien Loan as of December 31, 2021. In the first quarter of 2022, we repaid $190.7 million of the outstanding June 2017 First Lien Loan. On February 3, 2022, we entered into an amendment which refinanced the remaining balance of the June 2017 First Lien Loan with a new $275.0 million term loan (the “February 2022 First Lien Loan”), which has a maturity date of February 3, 2029, and added a new $100.0 million revolving credit facility (the “Revolving Facility”) with a maturity date of February 3, 2027. The terms of the February 2022 First Lien Loan specify a secured overnight financing rate (“SOFR”)-based floating interest rate and contain a springing financial covenant that requires compliance with a first lien net leverage ratio when revolver borrowings exceed certain levels. The February 2022 First Lien Loan requires quarterly amortization payments of $0.7 million. The Revolving Facility does not require periodic payments. All obligations under the February 2022 First Lien Loan are secured, subject to permitted liens and other exceptions, by first-priority perfected security interests in substantially all of our assets. The February 2022 First Lien Loan carries an interest rate of SOFR (subject to a 0.5% floor) plus 3.25%.

Current wording

In June 2017, we entered into a $575.0 million first lien debt facility (the “June 2017 First Lien Term Loan”). We had an outstanding loan balance of $465.7 million under the June 2017 First Lien Loan as of December 31, 2021. In the first quarter of 2022, we repaid $190.7 million of the outstanding June 2017 First Lien Loan. On February 3, 2022, we entered into an amendment which refinanced the remaining balance of the June 2017 First Lien Loan with a $275.0 million term loan (the “February 2022 First Lien Loan”), added a $100.0 million revolving credit facility (the “Revolving Facility”) with a maturity date of February 3, 2027, replaced the London Interbank Offered Rate (“LIBOR”)-based floating interest rate with a term SOFR-based floating interest rate, and revised the springing financial covenant to require compliance with a first lien net leverage ratio when revolver borrowings exceed certain levels.

Previous wording

In connection with our acquisition of Wavedash, we assumed long-term debt owed to Shoko Chukin Bank (the “Shoko Chukin Bank Loan”) of JPY 458.3 million (approximately $3.1 million), which has a maturity date of June 24, 2026 and is subject to a fixed interest rate of 1.27% per annum.

Current wording

In connection with our acquisition of Wavedash, we assumed long-term debt owed to Shoko Chukin Bank (the “Shoko Chukin Bank Loan”) of JPY 458.3 million (approximately $3.1 million), which had an original maturity date of June 24, 2026 and was subject to a fixed interest rate of 1.27% per annum. On April 4, 2024, we paid off the Shoko Chukin Bank Loan balance in its entirety.

Previous wording

As of March 31, 2024, we have the February 2022 First Lien Loan and the Shoko Chukin Bank Loan outstanding and we had no outstanding borrowings under the Revolving Facility.

Current wording

As of June 30, 2024, we had the June 2024 First Lien Loan outstanding and no outstanding borrowings under the Revolving Facility.

Previous wording

On February 29, 2024, our Board of Directors (our “Board”) authorized a share repurchase program for up to $100.0 million of our Class A common stock, which program was publicly announced on March 5, 2024 and does not have a fixed expiration date (the “2024 Repurchase Program”). As of March 31, 2024, we have repurchased 0.7 million shares of our Class A Common Stock for $4.1 million under the 2024 Repurchase Program and paid less than $0.1 million in commissions. As of March 31, 2024, approximately $95.9 million remained available for future repurchases under the 2024 Repurchase Program.

Current wording

On February 29, 2024, our Board of Directors (our “Board”) authorized a share repurchase program for up to $100.0 million of our Class A common stock, which program was publicly announced on March 5, 2024 and does not have a fixed expiration date (the “2024 Repurchase Program”). As of June 30, 2024, we had repurchased approximately 3.5 million shares of our Class A Common Stock for approximately $20.0 million under the 2024 Repurchase Program and paid less than $0.1 million in commissions. As of June 30, 2024, approximately $80.0 million remained available for future repurchases under the 2024 Repurchase Program.

Previous wording

Pursuant to its Limited Liability Company Agreement, Hoya Intermediate is required to make pro rata tax distributions to its members, of which $3.7 million is owed to non-controlling interests as of March 31, 2024.

Current wording

Per its Limited Liability Company Agreement, Hoya Intermediate is required to make pro-rata tax distributions to its members, of which $2.8 million and $6.4 million was distributed to non-controlling interests in the three and six months ended June 30, 2024, respectively.

Previous wording

Amounts payable under the TRA are contingent upon the generation of future taxable income over the term of the TRA and future changes in tax laws. If we do not generate sufficient taxable income in the aggregate over the term of the TRA to utilize the tax benefits, then we would not be required to make the related payments. As of March 31, 2024, we estimate that the tax savings associated with all tax attributes described above would require us to pay $165.7 million, primarily over the next 15 years. As of March 31, 2024, $5.5 million is due within the next 12 months.

Current wording

Amounts payable under the TRA are contingent upon the generation of future taxable income over the term of the TRA and future changes in tax laws. If we do not generate sufficient taxable income in the aggregate over the term of the TRA to utilize the tax benefits, then we would not be required to make the related payments. As of June 30, 2024, we estimate that the tax savings associated with all tax attributes described above would require us to pay $165.7 million, primarily over the next 15 years. As of June 30, 2024, $3.5 million is due within the next 12 months.

Previous wording

Net cash provided by operating activities was $65.1 million for the three months ended March 31, 2023 due to $30.3 million in net income, net non-cash charges of $8.2 million and net cash inflows from a $26.6 million change in net operating assets. The net cash inflows from the change in net operating assets were primarily due to an increase in accounts payable resulting from seasonal fluctuations.

Current wording

Net cash provided by operating activities was $25.4 million for the six months ended June 30, 2024 due to $9.5 million in net income, net non-cash charges of $54.0 million and net cash outflows from a $38.2 million change in net operating assets. The net cash outflows from the change in net operating assets were primarily due to the timing of receipts and disbursements for accrued expenses and other current liabilities, accounts receivable and inventory.

Previous wording

Net cash provided by operating activities was $39.2 million for the three months ended March 31, 2024 due to $10.7 million in net income, net non-cash charges of $23.0 million and net cash inflows from a $5.4 million change in net operating assets. The net cash inflows from the change in net operating assets were primarily due to an increase in accounts payable resulting from seasonal fluctuations.

Current wording

Net cash provided by operating activities was $82.7 million for the six months ended June 30, 2023 due to $68.6 million in net income, net non-cash incomes of $5.9 million and net cash inflows from a $20.0 million change in net operating assets. The net cash inflows from the change in net operating assets were primarily due to an increase in accounts payable resulting from seasonal fluctuations.

Previous wording

Net cash used in investing activities was $5.3 million and $2.6 million for the three months ended March 31, 2024 and 2023, respectively, which was primarily related to capital spending on development activities related to our platform.

Current wording

Net cash used in investing activities was $10.6 million and $5.6 million for the six months ended June 30, 2024 and 2023, respectively, which was primarily related to capital spending on development activities related to our platform.

Previous wording

Net cash used in financing activities was $4.6 million for the three months ended March 31, 2024, which was primarily related to the 2024 Repurchase Program.

Current wording

Net cash used in financing activities was $22.5 million for the six months ended June 30, 2023, which was primarily related to the 2022 Repurchase Program and tax distributions to non-controlling interests.