CINEMARK USA INC /TX

Previous wording

The following discussion and analysis should be read in conjunction with the condensed consolidated financial statements and related notes and schedules included elsewhere in this report. Amounts included in the following discussion, except for theaters, screens, average screens, average ticket price and concessions revenue per patron, are rounded in millions.

Current wording

The following discussion and analysis should be read in conjunction with the condensed consolidated financial statements and related notes and schedules included elsewhere in this report. Amounts included in the following discussion, except for theaters, screens, average screens, average ticket price and concession revenue per patron, are rounded in millions.

Previous wording

Films leading the box office during the six months ended June 30, 2026 included new releases The Super Mario Galaxy Movie, Michael, Toy Story 5, Project Hail Mary, Obsession, The Devil Wears Prada 2, Backrooms, and Star Wars: The Mandalorian and Grogu.

Current wording

Films leading the box office during the nine months ended September 30, 2026 included new releases Spider-Man: Brand New Day, The Odyssey, Toy Story 5, The Super Mario Galaxy Movie, Michael, Project Hail Mary, and Obsession.

Previous wording

Three months ended June 30, 2026 (the “second quarter of 2026”) versus the three months ended June 30, 2025 (the “second quarter of 2025”)

Current wording

Three months ended September 30, 2026 (the “third quarter of 2026”) versus the three months ended September 30, 2025 (the “third quarter of 2025”)

Previous wording

Second quarter of 2026 - The North American Industry box office generated approximately $3.0 billion during the second quarter of 2026, which included new releases The Super Mario Galaxy Movie, Michael, Toy Story 5, Obsession, The Devil Wears Prada 2, Backrooms, and Star Wars: The Mandalorian and Grogu.

Current wording

Third quarter of 2026 - The North American Industry box office generated approximately $3.1 billion during the third quarter of 2026, which included new releases Spider-Man: Brand New Day, The Odyssey, Minions & Monsters, Toy Story 5, and Moana.

Previous wording

Constant currency revenue amounts, which are non-GAAP measurements, were calculated using the average exchange rate for the corresponding month for 2025. We translate the results of our international reportable segment from local currencies into U.S. dollars using currency rates in effect at different points in time in accordance with U.S. GAAP. Significant changes in foreign currency exchange rates from one period to the next can result in meaningful variations in reported results. We are providing constant currency amounts for our international reporting segment to present a period-to-period comparison of business performance that excludes the impact of foreign currency fluctuations.

Current wording

Constant currency revenue amounts, which are non-GAAP measurements, were calculated using the average exchange rate for the corresponding month for 2025. We translate the results of our international reportable segment from local currencies into U.S. dollars using currency rates in effect at different points in time in accordance with U.S. GAAP. Significant changes in foreign currency exchange rates from one period to the next can result in meaningful variations in reported results. We are providing constant currency amounts for our international reportable segment to present a period-to-period comparison of business performance that excludes the impact of foreign currency fluctuations.

Previous wording

U.S. Attendance increased 8.7% to 40.1 million patrons during the second quarter of 2026 compared with 36.9 million patrons during the second quarter of 2025 primarily driven by a stronger film slate. Average ticket price increased 4.2% to $10.83 during the second quarter of 2026 compared with $10.39 during the second quarter of 2025 driven by strategic pricing actions and higher premium format mix. Concession revenue per patron increased 4.3% to $8.70 during the second quarter of 2026 compared with $8.34 during the second quarter of 2025 primarily driven by strategic pricing actions and favorable product mix. Other revenue for the second quarter of 2026 increased 12.3% to $76.7 million compared with $68.3 million during the second quarter of 2025 primarily due to higher transaction fees and an increase in screen advertising revenue.

Current wording

U.S. Attendance increased 12.7% to 37.4 million patrons during the third quarter of 2026 compared with 33.2 million patrons during the third quarter of 2025 primarily driven by a stronger film slate. Average ticket price increased 6.3% to $11.16 during the third quarter of 2026 compared with $10.50 during the third quarter of 2025 driven by strategic pricing actions and a higher premium format mix. Concession revenue per patron increased 5.6% to $8.66 during the third quarter of 2026 compared with $8.20 during the third quarter of 2025 primarily driven by strategic pricing actions, favorable product mix and higher incidence rates. Other revenue for the third quarter of 2026 increased 21.9% to $76.4 million compared with $62.7 million during the third quarter of 2025 primarily due to higher attendance and increases in online penetration, screen advertising revenue and gaming revenue.

Previous wording

International. Attendance increased to 23.6 million patrons for the second quarter of 2026 compared with 21.0 million during the second quarter of 2025 reflecting a stronger film slate. Revenues, average ticket price and concession revenue per patron for our international segment, as reported, were favorably impacted by exchange rate fluctuations during the second quarter of 2026. In constant currency, the average ticket price increased 9.3% to $4.36 for the second quarter of 2026 primarily due to inflationary pricing actions, partially offset by a lower premium format mix. In constant currency, concession revenue per patron increased 3.6% to $3.46 for the second quarter of 2026 primarily due to inflationary pricing actions, partially offset by a shift in mix. Other revenue increased 29.6% in constant currency to $35.5 million for the second quarter of 2026 primarily due to higher transaction fees, an increase in screen advertising and loyalty revenue, and inflationary impacts.

Current wording

International. Attendance increased 25.2% to 26.3 million patrons for the third quarter of 2026 compared with 21.0 million during the third quarter of 2025 reflecting a stronger film slate. Revenues, average ticket price and concession revenue per patron for our international segment, as reported, were favorably impacted by exchange rate fluctuations during the third quarter of 2026. In constant currency, the average ticket price increased 9.8% to $4.25 for the third quarter of 2026 primarily due to inflationary pricing actions. In constant currency, concession revenue per patron increased 8.8% to $3.33 for the third quarter of 2026 primarily due to inflationary pricing actions, partially offset by a shift in mix. Other revenue increased 31.3% in constant currency to $37.3 million for the third quarter of 2026 primarily due to higher attendance, inflationary impacts, and increases in online penetration, promotional income and loyalty revenue.

Previous wording

U.S. Film rentals and advertising costs were 59.5% of admissions revenue for the second quarter of 2026 compared with 59.4% of admissions revenue for the second quarter of 2025 primarily due to higher marketing spend. Concession supplies expense for the second quarter of 2026 period was 17.9% of concession revenue compared with 18.5% for the second quarter of 2025. The decrease in the concession supplies rate for the second quarter of 2026 period was primarily driven by strategic pricing actions, sourcing initiatives, and inventory management enhancements, partially offset by inflationary pressures and product mix.

Current wording

U.S. Film rentals and advertising costs were 60.1% of admissions revenue for the third quarter of 2026 compared with 58.4% of admissions revenue for the third quarter of 2025 due to a higher concentration of high-grossing films and increased marketing spend. Concession supplies expense for the third quarter of 2026 was 18.2% of concession revenue compared with 18.8% for the third quarter of 2025. The decrease in the concession supplies rate for the third quarter of 2026 was primarily driven by strategic pricing actions, sourcing initiatives and lower shrink and waste, partially offset by inflationary pressures.

Previous wording

Salaries and wages increased 4.5% to $95.0 million for the second quarter of 2026 period compared with $90.9 million for the second quarter of 2025 period due to higher attendance and wage and benefits inflation, partially offset by labor productivity initiatives. Facility lease expense increased 2.1% to $63.5 million, primarily due to higher percentage rent. Utilities and other costs increased 7.0% to $104.5 million, as many of these costs, such as credit card fees, repairs and maintenance, utilities and janitorial costs, are variable or semi-variable in nature and were impacted by the increase in attendance. An increase in gift card commissions and fees also contributed to the increase in utilities and other costs.

Current wording

Salaries and wages increased 4.5% to $92.7 million for the third quarter of 2026 compared with $88.7 million for the third quarter of 2025 due to higher attendance and wage and benefits inflation, partially offset by labor productivity initiatives. Facility lease expense increased 3.9% to $63.4 million, primarily due to higher percentage rent. Utilities and other costs increased 10.0% to $108.9 million, as many of these costs, such as credit card fees, premium format licensing fees, repairs and maintenance, and janitorial costs, are variable or semi-variable in nature and were impacted by the increase in attendance.

Previous wording

International. Our international operating costs, as reported, were unfavorably impacted by exchange rate fluctuations for the second quarter of 2026.

Current wording

International. Our international operating costs, as reported, were unfavorably impacted by exchange rate fluctuations for the third quarter of 2026.

Previous wording

Film rentals and advertising costs were 50.7% of admissions revenue as reported for the second quarter of 2026 compared with 51.5% for the second quarter of 2025 primarily due to the overall mix of films. Concession supplies expense remained flat at 23.0% of concessions revenue as reported for the second quarter of 2026 compared with the second quarter of 2025.

Current wording

Film rentals and advertising costs were 51.5% of admissions revenue as reported for the third quarter of 2026 compared with 51.8% for the third quarter of 2025 primarily due to the overall mix of films and decreased marketing spend. Concession supplies expense was 22.3% of concession revenue as reported for the third quarter of 2026 compared with 22.6% for the third quarter of 2025. The decrease in the concession supplies rate for the third quarter of 2026 was primarily driven by our pricing actions, sourcing initiatives, and favorable product mix.

Previous wording

In constant currency, salaries and wages increased 14.1% to $21.1 million for the second quarter of 2026 primarily driven by wage inflation and higher attendance, partially offset by labor productivity initiatives. Facility lease expense increased 17.9% to $24.4 million in constant currency compared with the second quarter of 2025 primarily due to higher percentage rent and inflationary impacts. Utilities and other costs increased 16.3% to $31.4 million in constant currency for the second quarter of 2026 primarily due to inflationary pressures and the impact of the increase in attendance, as many of these costs are variable or semi-variable in nature.

Current wording

In constant currency, salaries and wages increased 27.8% to $22.5 million for the third quarter of 2026 primarily driven by wage inflation and higher attendance. Facility lease expense increased 24.4% to $26.0 million in constant currency compared with the third quarter of 2025 primarily due to higher percentage rent and inflationary impacts. Utilities and other costs increased 18.0% to $33.5 million in constant currency for the third quarter of 2026 primarily due to inflationary pressures and the impact of the increase in attendance, as many of these costs are variable or semi-variable in nature.

Previous wording

General and Administrative Expense. General and administrative expense for Holdings increased to $62.8 million for the second quarter of 2026 compared with $54.1 million for the second quarter of 2025. General and administrative expense for CUSA increased to $61.8 million for the second quarter of 2026 compared with $53.3 million for the second quarter of 2025. The increase for both Holdings and CUSA is primarily due to higher wages and benefits, increased headcount, higher incentive and share-based compensation, and an increase in cloud-based software costs.

Current wording

General and Administrative Expense. General and administrative expense for Holdings increased to $63.5 million for the third quarter of 2026 compared with $61.9 million for the third quarter of 2025. General and administrative expense for CUSA increased to $62.5 million for the third quarter of 2026 compared with $61.1 million for the third quarter of 2025. The increase for both Holdings and CUSA is primarily due to higher wages and benefits, increased headcount, and an increase in professional fees, partially offset by lower incentive compensation.

Previous wording

Depreciation and Amortization. Depreciation and amortization expense increased to $51.6 million for the second quarter of 2026 compared with $49.4 million for the second quarter of 2025.

Current wording

Depreciation and Amortization. Depreciation and amortization expense increased to $53.5 million for the third quarter of 2026 compared with $50.9 million for the third quarter of 2025.

Previous wording

Loss on Disposal of Assets and Other. A loss on disposal of assets and other of $2.8 million was recorded for the second quarter of 2026 compared with $1.0 million for the second quarter of 2025. Activity for both the second quarter of 2026 and 2025 was primarily related to the retirement of certain assets that were replaced as a result of theater enhancements and remodels.

Current wording

(Gain) Loss on Disposal of Assets and Other. A gain on disposal of assets and other of $2.3 million was recorded for the third quarter of 2026 compared with a loss of $3.0 million for the third quarter of 2025. Activity for the third quarter of 2026 was primarily related to a gain on the sale of a land parcel. Activity for the third quarter of 2025 was primarily related to the retirement of certain assets that were replaced as a result of theater remodels.

Previous wording

Interest Expense. Interest expense for Holdings, which includes amortization of debt issuance costs and original issue discount and amortization of accumulated losses for swap amendments, was $31.3 million during the second quarter of 2026 compared with $39.4 million during the second quarter of 2025. The interest expense attributable to CUSA was $31.3 million during the second quarter of 2026 compared with $33.4 million during the second quarter of 2025. The decrease in interest expense at Holdings primarily reflects the impact of the payoff of the $460.0 million principal of the 4.50% Convertible Senior Notes on August 15, 2025. The decrease for both Holdings and CUSA also reflects a reduction in our term loan interest rate due to the term loan reprice transactions in June 2025 and May 2026.

Current wording

Interest Expense. Interest expense for Holdings, which includes amortization of debt issuance costs and original issue discount and amortization of accumulated losses for swap amendments, was $31.3 million during the third quarter of 2026 compared with $32.2 million during the third quarter of 2025. The interest expense attributable to CUSA was $31.3 million during the third quarter of 2026 compared with $29.3 million during the third quarter of 2025. The decrease in interest expense at Holdings primarily reflects the impact of the payoff of the $460.0 million principal of the 4.50% Convertible Senior Notes on August 15, 2025.

Previous wording

Income Taxes - Holdings. An income tax expense of $62.4 million was recorded for the second quarter of 2026 compared with an income tax expense of $42.5 million for the second quarter of 2025. The effective tax rate was approximately 30.7% for the second quarter of 2026 compared with 31.0% for the second quarter of 2025. The effective tax rates for the second quarter of 2026 and the second quarter of 2025 differ from the U.S. statutory rate primarily due to foreign tax rate differences, the U.S. tax impact of foreign operations, and state and local taxes. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Current wording

Income Taxes - Holdings. An income tax expense of $50.3 million was recorded for the third quarter of 2026 compared with an income tax benefit of $22.9 million for the third quarter of 2025. The effective tax rate was approximately 28.9% for the third quarter of 2026 compared with (82.8)% for the third quarter of 2025. The effective tax rate for the third quarter of 2026 differs from the U.S. statutory rate primarily due to foreign tax rate differences, the U.S. tax impact of foreign operations, and state and local taxes. The effective tax rate for the third quarter of 2025 was favorably impacted by changes in valuation allowances previously recorded against federal and certain state interest expense carryforwards. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Previous wording

Income Taxes - CUSA. An income tax expense of $62.5 million was recorded for the second quarter of 2026 compared with income tax expense of $43.6 million for the second quarter of 2025. The effective tax rate was approximately 30.6% for the second quarter of 2026 period compared with 30.3% for the second quarter of 2025. The effective tax rates for the second quarter of 2026 and the second quarter of 2025 differ from the U.S. statutory rate primarily due to foreign tax rate differences, U.S. tax impact of foreign operations, and state and local taxes. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Current wording

Income Taxes - CUSA. An income tax expense of $50.7 million was recorded for the third quarter of 2026 compared with income tax expense of $23.8 million for the third quarter of 2025. The effective tax rate was approximately 28.9% for the third quarter of 2026 compared with 27.8% for the third quarter of 2025. The effective tax rates for the third quarter of 2026 and the third quarter of 2025 differ from the U.S. statutory rate primarily due to foreign tax rate differences, the U.S. tax impact of foreign operations, and state and local taxes. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Previous wording

Six months ended June 30, 2026 (the “2026 period”) versus the six months ended June 30, 2025 (the “2025 period”)

Current wording

Nine months ended September 30, 2026 (the “2026 period”) versus the nine months ended September 30, 2025 (the “2025 period”)

Previous wording

2026 Period - The North American Industry box office generated approximately $4.8 billion during the 2026 period, which included new releases The Super Mario Galaxy Movie, Michael, Toy Story 5, Project Hail Mary, Obsession, The Devil Wears Prada 2, Backrooms, and Star Wars: The Mandalorian and Grogu.

Current wording

2026 Period - The North American Industry box office generated approximately $7.9 billion during the 2026 period, which included new releases Spider-Man: Brand New Day, The Odyssey, Toy Story 5, The Super Mario Galaxy Movie, Michael, Project Hail Mary, and Obsession.

Previous wording

Second quarter of 2025 - The North American Industry box office generated approximately $2.7 billion during the second quarter of 2025, which included new releases A Minecraft Movie, Lilo & Stitch, Sinners, How to Train Your Dragon, Thunderbolts*, Mission: Impossible - The Final Reckoningand Final Destination: Bloodlines.

Current wording

2025 Period - The North American Industry box office generated approximately $6.7 billion during the 2025 period, which included new releases A Minecraft Movie, Lilo & Stitch, Superman, Jurassic World: Rebirth, and Sinners.

Previous wording

Constant currency revenue amounts, which are non-GAAP measurements, were calculated using the average exchange rate for the corresponding month for 2025. We translate the results of our international reportable segment from local currencies into U.S. dollars using currency rates in effect at different points in time in accordance with U.S. GAAP. Significant changes in foreign currency exchange rates from one period to the next can result in meaningful variations in reported results. We are providing constant currency amounts for our international reporting segment to present a period-to-period comparison of business performance that excludes the impact of foreign currency fluctuations.

Current wording

Constant currency revenue amounts, which are non-GAAP measurements, were calculated using the average exchange rate for the corresponding month for 2025. We translate the results of our international reportable segment from local currencies into U.S. dollars using currency rates in effect at different points in time in accordance with U.S. GAAP. Significant changes in foreign currency exchange rates from one period to the next can result in meaningful variations in reported results. We are providing constant currency amounts for our international reportable segment to present a period-to-period comparison of business performance that excludes the impact of foreign currency fluctuations.

Previous wording

U.S. Attendance increased to 64.2 million patrons during the 2026 period compared with 57.5 million patrons during the 2025 period primarily driven by a stronger film slate. Average ticket price increased 4.3% to $10.72 during the 2026 period compared with $10.28 during the 2025 period driven by strategic pricing actions and higher premium format mix. Concession revenue per patron increased 5.5% to $8.66 during the 2026 period compared with $8.21 during the 2025 period primarily driven by strategic pricing actions and a favorable shift in product mix. Other revenue for the 2026 period increased 15.3% to $130.8 million compared with $113.4 million during the 2025 period primarily due to higher transaction fees as well as an increase in screen advertising revenue and promotional income.

Current wording

U.S. Attendance increased 12.0% to 101.6 million patrons during the 2026 period compared with 90.7 million patrons during the 2025 period primarily driven by a stronger film slate. Average ticket price increased 5.0% to $10.88 during the 2026 period compared with $10.36 during the 2025 period driven by strategic pricing actions and higher premium format mix. Concession revenue per patron increased 5.5% to $8.66 during the 2026 period compared with $8.21 during the 2025 period primarily driven by strategic pricing actions and a favorable shift in product mix. Other revenue for the 2026 period increased 17.7% to $207.2 million compared with $176.1 million during the 2025 period primarily due to higher attendance as well as increases in online penetration, screen advertising revenue, promotional income and gaming revenue.

Previous wording

International. Attendance increased to 38.5 million patrons for the 2026 period from 37.0 million during the 2025 period driven by a stronger film slate. Revenues, average ticket price and concession revenue per patron for our international segment, as reported, were favorably impacted by exchange rate fluctuations during the 2026 period. In constant currency, the average ticket price increased 9.8% to $4.16 for the 2026 period primarily due to inflationary pricing actions, partially offset by a lower premium format mix. In constant currency, concession revenue per patron increased 7.0% to $3.36 for the 2026 period primarily due to inflationary pricing actions, partially offset by a shift in mix. Other revenue increased 20.0% in constant currency to $58.2 million for the 2026 period primarily due to higher transaction fees, an increase in loyalty revenue and inflationary impacts.

Current wording

International. Attendance increased to 64.8 million patrons for the 2026 period from 58.0 million during the 2025 period driven by a stronger film slate. Revenues, average ticket price and concession revenue per patron for our international segment, as reported, were favorably impacted by exchange rate fluctuations during the 2026 period. In constant currency, the average ticket price increased 9.9% to $4.20 for the 2026 period primarily due to inflationary pricing actions. In constant currency, concession revenue per patron increased 7.7% to $3.35 for the 2026 period primarily due to inflationary pricing actions, partially offset by a shift in mix. Other revenue increased 24.2% in constant currency to $95.5 million for the 2026 period primarily due to higher attendance, inflationary impacts and an increase in loyalty revenue and online penetration.

Previous wording

U.S. Film rentals and advertising costs increased to 58.0% of admissions revenue for the 2026 period compared with 57.7% of admissions revenue for the 2025 period primarily due to higher marketing spend and the increased scale and concentration of high-grossing films. Concession supplies expense for the 2026 period was 18.1% of concession revenue compared with 19.2% for the 2025 period. The decrease in the concession supplies rate for the 2026 period was primarily driven by strategic pricing actions and sourcing initiatives, partially offset by inflationary pressures.

Current wording

U.S. Film rentals and advertising costs increased to 58.8% of admissions revenue for the 2026 period compared with 57.9% of admissions revenue for the 2025 period primarily due to the increased scale and concentration of high-grossing films and higher marketing spend. Concession supplies expense for the 2026 period was 18.1% of concession revenue compared with 19.1% for the 2025 period. The decrease in the concession supplies rate for the 2026 period was primarily driven by strategic pricing actions, sourcing initiatives and lower shrink and waste, partially offset by inflationary pressures.

Previous wording

Salaries and wages increased 4.0% to $172.2 million for the 2026 period compared with $165.5 million for the 2025 period due to higher attendance and wage and benefits inflation, partially offset by labor productivity initiatives. Facility lease expense increased 2.8% to $125.8 million, primarily due to higher percentage rent. Utilities and other costs increased 7.7% to $193.3 million, as many of these costs, such as credit card fees, repairs and maintenance, utilities and janitorial costs, are variable or semi-variable in nature and were impacted by the increase in attendance. An increase in gift card commissions and fees also contributed to the increase in utilities and other costs.

Current wording

Salaries and wages increased 4.2% to $264.9 million for the 2026 period compared with $254.2 million for the 2025 period due to higher attendance and wage and benefits inflation, partially offset by labor productivity initiatives. Facility lease expense increased 3.2% to $189.2 million, primarily due to higher percentage rent. Utilities and other costs increased 8.5% to $302.2 million, as many of these costs, such as credit card fees, repairs and maintenance, utilities, premium format licensing fees and janitorial costs, are variable or semi-variable in nature and were impacted by the increase in attendance. An increase in gift card commissions and fees also contributed to the increase in utilities and other costs.

Previous wording

Film rentals and advertising costs were 50.4% of admissions revenue as reported for the 2026 period compared with 50.9% for the 2025 period primarily due to the overall mix of films. Concession supplies expense was 22.7% of concessions revenue as reported for the 2026 period compared with 22.9% for the 2025 period. The decrease in the concession supplies rate was primarily driven by strategic pricing actions and sourcing initiatives, as well as favorable product mix.

Current wording

Film rentals and advertising costs were 50.8% of admissions revenue as reported for the 2026 period compared with 51.2% for the 2025 period primarily due to the overall mix of films. Concession supplies expense was 22.5% of concession revenue as reported for the 2026 period compared with 22.8% for the 2025 period. The decrease in the concession supplies rate was primarily driven by pricing actions and sourcing initiatives, as well as favorable product mix.

Previous wording

In constant currency, salaries and wages increased 11.7% to $38.2 million for the 2026 period primarily driven by wage inflation and higher attendance, partially offset by labor productivity initiatives. Facility lease expense increased 9.0% to $42.3 million in constant currency compared with the 2025 period, primarily due to higher percentage rent and inflationary impacts. Utilities and other costs increased 12.4% to $57.2 million in constant currency for the 2026 period primarily due to inflationary pressures and the impact of the increase in attendance, as many of these costs are variable or semi-variable in nature.

Current wording

In constant currency, salaries and wages increased 17.2% to $60.7 million for the 2026 period primarily driven by wage inflation and higher attendance, partially offset by labor productivity initiatives. Facility lease expense increased 14.4% to $68.3 million in constant currency compared with the 2025 period, primarily due to higher percentage rent and inflationary impacts. Utilities and other costs increased 14.4% to $90.7 million in constant currency for the 2026 period primarily due to inflationary pressures and the impact of the increase in attendance, as many of these costs are variable or semi-variable in nature.

Previous wording

General and Administrative Expense. General and administrative expense for Holdings increased to $118.9 million for the 2026 period compared with $108.6 million for the 2025 period. General and administrative expense for CUSA increased to $116.8 million for the 2026 period compared with $106.8 million for the 2025 period. The increase for both Holdings and CUSA is primarily due to higher wages and benefits, increased headcount, higher incentive and share-based compensation, and an increase in cloud-based software costs, partially offset by a decrease in professional fees.

Current wording

General and Administrative Expense. General and administrative expense for Holdings increased to $182.4 million for the 2026 period compared with $170.5 million for the 2025 period. General and administrative expense for CUSA increased to $179.3 million for the 2026 period compared with $167.9 million for the 2025 period. The increase for both Holdings and CUSA is primarily due to higher wages and benefits, increased headcount, higher share-based compensation, and increases in cloud-based software costs and professional fees, partially offset by lower incentive compensation.

Previous wording

Depreciation and Amortization. Depreciation and amortization expense increased to $103.2 million for the 2026 period compared with $98.9 million for the 2025 period.

Current wording

Depreciation and Amortization. Depreciation and amortization expense increased to $156.7 million for the 2026 period compared with $149.8 million for the 2025 period.

Previous wording

Loss (Gain) on Disposal of Assets and Other. A loss on disposal of assets and other of $6.5 million was recorded for the 2026 period compared with a gain of $3.1 million for the 2025 period. Activity for the 2026 period was primarily related to the retirement of certain assets that were replaced as a result of theater enhancements. Activity for the 2025 period was primarily related to gains on the sale of a land parcel and one of our owned theater properties, partially offset by the retirement of certain assets replaced as a result of remodels.

Current wording

Loss (Gain) on Disposal of Assets and Other. A loss on disposal of assets and other of $4.2 million was recorded for the 2026 period compared with a gain of $0.1 million for the 2025 period. Activity for the 2026 period was primarily related to the retirement of certain assets that were replaced as a result of theater enhancements, partially offset by a gain on the sale of a land parcel. Activity for the 2025 period was primarily related to gains on the sale of real estate, offset by the retirement of certain assets replaced as a result of remodels.

Previous wording

Interest Expense. Interest expense for Holdings, which includes amortization of debt issuance costs and original issue discount and amortization of accumulated losses for swap amendments, was $66.0 million during the 2026 period compared with $77.9 million during the 2025 period. The interest expense attributable to CUSA was $66.0 million during the 2026 period compared with $65.8 million during the 2025 period. The decrease in interest expense at Holdings reflects the impact of the payoff of the $460.0 million principal of the 4.50% Convertible Senior Notes on August 15, 2025. The decrease for both Holdings and CUSA also reflects a reduction in our term loan interest rate due to the term loan reprice transactions in June 2025 and May 2026.

Current wording

Interest Expense. Interest expense for Holdings, which includes amortization of debt issuance costs and original issue discount and amortization of accumulated losses for swap amendments, was $97.3 million during the 2026 period compared with $110.1 million during the 2025 period. The interest expense attributable to CUSA was $97.3 million during the 2026 period compared with $95.1 million during the 2025 period. The decrease in interest expense at Holdings reflects the impact of the payoff of the $460.0 million principal of the 4.50% Convertible Senior Notes on August 15, 2025.

Previous wording

Loss on Debt Amendments and Extinguishments. We recorded a loss on amendment and extinguishment of debt of $2.8 million and $1.5 million during the 2026 and 2025 period, respectively, related to the amendments of our term loan, including the write-off of unamortized debt issuance costs and original issue discount, and legal and other fees paid.

Current wording

Loss on Debt Amendments and Extinguishments. We recorded a loss on amendment and extinguishment of debt of $2.8 million and $1.5 million during the 2026 and 2025 periods, respectively, related to the amendments of our term loan, including the write-off of unamortized debt issuance costs and original issue discount, and legal and other fees paid.

Previous wording

Other Income, Net. Other income, net for Holdings was $5.7 million during the 2026 period compared with $9.0 million during the 2025 period. Other income, net attributable to CUSA was $5.7 million during the 2026 period compared with $6.7 million during the 2025 period. The decrease in other income, net for Holdings and CUSA reflects a decrease in interest income, primarily due to lower average cash balances and lower interest rates, partially offset by the favorable impact of the mark-to-market adjustment on our investment in NCMI under the fair value basis of accounting and foreign currency exchange gains primarily related to the impact of hyper-inflationary accounting for Argentina.

Current wording

Other Income, Net. Other income, net for Holdings was $4.9 million during the 2026 period compared with $8.9 million during the 2025 period. Other income, net attributable to CUSA was $4.8 million during the 2026 period compared with $6.4 million during the 2025 period. The decrease in other income, net for Holdings and CUSA reflects a decrease in interest income, primarily due to lower average cash balances and lower interest rates, partially offset by the favorable impact of the mark-to-market adjustment on our investment in NCMI, foreign currency exchange gains primarily related to the impact of hyper-inflationary accounting for Argentina, and higher income earned from our investment in AC JV LLC.

Previous wording

Income Taxes - Holdings. An income tax expense of $58.4 million was recorded for the 2026 period compared with an income tax expense of $27.8 million for the 2025 period. The effective tax rate was approximately 30.2% for the 2026 period compared with 33.1% for the 2025 period. The effective tax rates for the 2026 and 2025 periods differ from the U.S. statutory rate primarily due to foreign tax rate differences, the U.S. tax impact of foreign operations, and state and local taxes. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Current wording

Income Taxes - Holdings. An income tax expense of $108.7 million was recorded for the 2026 period compared with an income tax expense of $4.9 million for the 2025 period. The effective tax rate was approximately 29.6% for the 2026 period compared with 4.4% for the 2025 period. The effective tax rate for the 2026 period differs from the U.S. statutory rate primarily due to foreign tax rate differences, the U.S. tax impact of foreign operations, and state and local taxes. During the 2025 period, a deferred tax benefit of $47.7 million was recorded discretely related to the release of valuation allowances previously recorded against federal and certain state interest expense carryforwards. The changes in tax law within the OBBBA related to the business interest expense limitation resulted in sufficient positive evidence to reach a conclusion that valuation allowances related to federal and certain state interest expense carryforwards are no longer required. This discrete benefit favorably impacted the effective tax rate for the 2025 period, causing the income tax expense to vary significantly from the tax expense derived by applying the statutory tax rate to the pre-tax income for the period. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Previous wording

Income Taxes - CUSA. An income tax expense of $58.9 million was recorded for the 2026 period compared with income tax expense of $29.4 million for the 2025 period. The effective tax rate was approximately 30.1% for the 2026 period compared with 30.7% for the 2025 period. The effective tax rates for the 2026 and 2025 periods differ from the U.S. statutory rate primarily due to foreign tax rate differences, U.S. tax impact of foreign operations, and state and local taxes. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Current wording

Income Taxes - CUSA. An income tax expense of $109.6 million was recorded for the 2026 period compared with income tax expense of $53.2 million for the 2025 period. The effective tax rate was approximately 29.5% for the 2026 period compared with 29.4% for the 2025 period. The effective tax rates for the 2026 and 2025 periods differ from the U.S. statutory rate primarily due to foreign tax rate differences, the U.S. tax impact of foreign operations, and state and local taxes. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Previous wording

Cash provided by operating activities was $339.7 million for Holdings and $340.0 million for CUSA for the six months ended June 30, 2026, compared with cash provided by operating activities of $156.8 million for Holdings and $164.4 million for CUSA for the six months ended June 30, 2025. The increase in cash provided by operating activities was primarily driven by the level of revenue earned during each period and the timing of payments to vendors for expenses.

Current wording

Cash provided by operating activities was $475.8 million for Holdings and $476.1 million for CUSA for the nine months ended September 30, 2026, compared with cash provided by operating activities of $248.3 million for Holdings and $260.1 million for CUSA for the nine months ended September 30, 2025. The increase in cash provided by operating activities was primarily driven by the level of revenue earned during each period and the timing of payments to vendors for expenses.

Previous wording

Investing activities have been principally related to the development, remodel and enhancement of theaters. Cash used for investing activities was $99.1 million and $45.2 million for the six months ended June 30, 2026 and 2025, respectively. The increase in cash used for investing activities was primarily due to an increase in capital expenditures to support the continued enhancement of our global circuit.

Current wording

Investing activities have been principally related to the development, remodel and enhancement of theaters. Cash used for investing activities was $166.5 million and $98.6 million for the nine months ended September 30, 2026 and 2025, respectively. The increase in cash used for investing activities was primarily due to an increase in capital expenditures to support the continued enhancement of our global circuit.

Previous wording

Below is a summary of capital expenditures, disaggregated by new and existing theaters, for the six months ended June 30, 2026 and 2025 (in millions):

Current wording

Below is a summary of capital expenditures, disaggregated by new and existing theaters, for the nine months ended September 30, 2026 and 2025 (in millions):

Previous wording

We operated 495 theaters with 5,620 screens worldwide as of June 30, 2026. Theaters and screens opened and closed during the six months ended June 30, 2026 were as follows:

Current wording

We operated 496 theaters with 5,618 screens worldwide as of September 30, 2026. Theaters and screens opened and closed during the nine months ended September 30, 2026 were as follows: