Playboy, Inc.

Previous wording

You should read the following discussion of our financial condition and results of operations in conjunction with our unaudited interim condensed consolidated financial statements as of and for the three and six months ended June 30, 2025 and 2024 and the related notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q, our audited consolidated financial statements as of and for the years ended December 31, 2024 and 2023 and the related notes thereto included in our Annual Report on Form 10-K filed with the SEC on March 13, 2025. This discussion contains forward-looking statements that involve risks and uncertainties and that are not historical facts, including statements about our beliefs and expectations. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed below and particularly under the headings “Risk Factors”, “Business” and “Cautionary Note Regarding Forward-Looking Statements” contained in our Annual Report on Form 10-K filed with the SEC on March 13, 2025. As used herein, “we”, “us”, “our”, and the “Company” refer to Playboy, Inc. and its subsidiaries.

Current wording

You should read the following discussion of our financial condition and results of operations in conjunction with our unaudited interim condensed consolidated financial statements as of and for the three and nine months ended September 30, 2025 and 2024 and the related notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q, our audited consolidated financial statements as of and for the years ended December 31, 2024 and 2023 and the related notes thereto included in our Annual Report on Form 10-K filed with the SEC on March 13, 2025. This discussion contains forward-looking statements that involve risks and uncertainties and that are not historical facts, including statements about our beliefs and expectations. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed below and particularly under the headings “Risk Factors”, “Business” and “Cautionary Note Regarding Forward-Looking Statements” contained in our Annual Report on Form 10-K filed with the SEC on March 13, 2025. As used herein, “we”, “us”, “our”, and the “Company” refer to Playboy, Inc. and its subsidiaries.

Previous wording

We are a global consumer lifestyle company marketing our brands through a wide range of licensing initiatives, direct-to-consumer products, Playboy magazine, digital subscriptions and content, and online and location-based entertainment. As of January 1, 2025, we licensed certain intellectual property and our Playboy Plus, Playboy TV (online and linear) and Playboy Club digital operations to Byborg Enterprises SA (“Byborg”) pursuant to a License & Management Agreement (the “LMA”). As a result, we now have two reportable segments: Direct-to-Consumer and Licensing. The Direct-to-Consumer segment derives revenue from sales of consumer products sold directly to consumers by Honey Birdette online or at its brick-and-mortar stores, with 51 stores in three countries as of June 30, 2025. The Licensing segment derives revenue from trademark licenses for third-party consumer products, primarily for various apparel and accessories categories, hospitality, digital gaming and location-based entertainment businesses, and starting January 1, 2025, revenue from licensing our digital subscriptions and content operations to Byborg.

Current wording

We are a global consumer lifestyle company marketing our brands through a wide range of licensing initiatives, direct-to-consumer products, Playboy magazine, digital subscriptions and content, and online and location-based entertainment. As of January 1, 2025, we licensed certain intellectual property and our Playboy Plus, Playboy TV (online and linear) and Playboy Club digital businesses to Byborg Enterprises SA (“Byborg”) pursuant to a License & Management Agreement (the “LMA”). As a result, we have two reportable segments: Direct-to-Consumer and Licensing. The Direct-to-Consumer segment derives revenue from sales of consumer products sold directly to consumers by Honey Birdette online or at its brick-and-mortar stores, with 51 stores in three countries as of September 30, 2025. The Licensing segment derives revenue from trademark licenses for third-party consumer products, primarily for various apparel and accessories categories, hospitality, digital gaming and location-based entertainment businesses, and starting January 1, 2025, revenue from licensing our digital subscriptions and content operations to Byborg.

Previous wording

We continue to pursue a commercial strategy that relies on a more capital-light business model focused on revenue streams with higher margin, lower working capital requirements and higher growth potential. We are doing this by leveraging our flagship Playboy brand to attract best-in-class operators. In the fourth quarter of 2024, we entered into the LMA with Byborg to license intellectual property and select Playboy digital assets for $300.0 million in minimum guaranteed payments over the initial 15-year term of the license, which began as of January 1, 2025. We are focused on strategically expanding our licensing business into new categories and territories with high quality strategic partners and supporting them with brand marketing in the form of content, experiences and editorial works. We will also continue to use our licensing business as a marketing tool and brand builder, including through high profile collaborations and our large-scale strategic partnerships. For our Honey Birdette business, we intend to focus on the U.S. market, where the brand’s stores, on average, generate more revenue and better margins, and generally have customers who tend to spend more and are less price sensitive.

Current wording

We continue to pursue a commercial strategy that relies on a more capital-light business model focused on revenue streams with higher margin, lower working capital requirements and higher growth potential. We are doing this by leveraging our flagship Playboy brand to attract best-in-class operators. We also use our licensing business as a marketing tool and brand builder, including through high profile collaborations and our large-scale strategic partnerships.

Previous wording

Our licensing revenues from China (including Hong Kong) as a percentage of our total revenues were 11% and 12% for the three months ended June 30, 2025 and 2024, respectively, and 11% and 8% for the six months ended June 30, 2025 and 2024, respectively. At the end of the first quarter of 2023, we entered into a joint venture for the Playboy business in China (the “China JV”) with CT Licensing Limited, a brand management unit of Fung Group. The China JV owns and operates the Playboy consumer products business in mainland China, Hong Kong and Macau. In 2024, our China JV stabilized our business in China, and we expect our licensing activity in China to increase slightly in 2025 and continue to represent a modest but meaningful part of our overall business in future periods.

Current wording

After having stabilized Playboy’s China business in 2024 and 2025, in the fourth quarter of 2025, we transitioned our joint venture for the Playboy business in China (the “China JV”) into a more typical licensing structure, with our former China JV partner, CT Licensing Limited, a brand management unit of Fung Group, becoming our licensing agent in China, and which will continue to support our consumer products licensing business in mainland China (inclusive of Hong Kong and Macau). We expect our licensing business in China to continue to represent a material part of our overall business. Our licensing revenues from China as a percentage of our total revenues were 11% for the three months ended September 30, 2025 and 2024, respectively, and 11% and 9% for the nine months ended September 30, 2025 and 2024, respectively.

Previous wording

We continue to monitor ongoing changes in U.S. trade policies, including increasing tariffs on imports, in some cases significantly, and changes to existing international trade agreements. These actions have prompted retaliatory tariffs and other measures by a number of countries. In the second quarter of 2025, actions were taken by the U.S. and certain other countries to modify the timing, rates and/or other aspects of certain of these tariffs. However, some of the new tariffs remain in effect, including tariffs between the U.S. and China, where we source the manufacturing of our Honey Birdette products and where we have a locally-based joint venture for the sale of Playboy-branded products in China. While the impact of such trade policies on our business remains uncertain, we continue to closely monitor such matters and potential impacts, including increased production costs and higher pricing to our customers, either of which could negatively affect our business, results of operations and financial condition. Refer to “Part II, Item 1A. Risk Factors” in this Quarterly Report on Form 10-Q and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 for additional information on such risks.

Current wording

We continue to monitor ongoing changes in U.S. trade policies, including increasing tariffs on imports, in some cases significantly, and changes to existing international trade agreements. These actions have prompted retaliatory tariffs and other measures by a number of countries. Starting in the second quarter of 2025, actions were taken by the U.S. and certain other countries to modify the timing, rates and/or other aspects of certain of these tariffs. However, some of the new tariffs remain in effect, including tariffs between the U.S. and China, where we source the manufacturing of our Honey Birdette products and where many of our licensees source their products. While the impact of such trade policies on our business remains uncertain, we continue to closely monitor such matters and potential impacts, including increased production costs and higher pricing to our customers, either of which could negatively affect our business, results of operations and financial condition.

Previous wording

Cost of sales primarily consist of merchandise costs, warehousing and fulfillment costs, agency and commission fees, website expenses, marketplace traffic acquisition costs, digital platform expenses (prior to January 1, 2025), transition expenses per the TSA (commencing January 1, 2025), credit card processing fees, personnel costs, including stock-based compensation, costs associated with branding events, customer shipping and handling expenses, fulfillment activity costs and freight-in expenses.

Current wording

Cost of sales primarily consist of merchandise costs, warehousing and fulfillment costs, agency and commission fees, website expenses, marketplace traffic acquisition costs, digital platform expenses (prior to January 1, 2025), transition expenses per the TSA (commencing January 1, 2025 through June 30, 2025), credit card processing fees, personnel costs, including stock-based compensation, costs associated with branding events, customer shipping and handling expenses, fulfillment activity costs and freight-in expenses.

Previous wording

Selling and administrative expenses primarily consist of corporate office and retail store occupancy costs, personnel costs, including stock-based compensation, transition expenses per the TSA (commencing January 1, 2025), brand marketing costs, and contractor fees for accounting/finance, legal, human resources, information technology and other administrative functions, general marketing and promotional activities and insurance.

Current wording

Selling and administrative expenses primarily consist of corporate office and retail store occupancy costs, personnel costs, including stock-based compensation, transition expenses per the TSA (commencing January 1, 2025 through June 30, 2025), brand marketing costs, and contractor fees for accounting/finance, legal, human resources, information technology and other administrative functions, general marketing and promotional activities and insurance.

Previous wording

Impairments consist of the impairments of our artwork held for sale and right-of-use assets related to our corporate leases.

Current wording

Impairments consist of the impairments of our artwork held for sale, right-of-use assets related to our corporate leases, internally developed software and goodwill.

Previous wording

Other operating (expense) income, net consists primarily of losses on disposal of assets and other miscellaneous items.

Current wording

Other operating income (expense), net consists primarily of gains and losses on disposal of assets and other miscellaneous items.

Previous wording

Other income (expense), net consists primarily of other miscellaneous nonoperating items, such as nonrecurring transaction fees, foreign exchange realized and unrealized transaction gains or losses, bank charges and interest income.

Current wording

Other income, net consists primarily of other miscellaneous nonoperating items, such as nonrecurring transaction fees, foreign exchange realized and unrealized transaction gains or losses, bank charges and interest income.

Previous wording

Expense from income taxes consists of an estimate for U.S. federal, state, and foreign income taxes based on enacted rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities, and changes in the tax law. Due to cumulative losses, we maintain a valuation allowance against our definite-lived U.S. federal and state deferred tax assets, as well as Australia, U.K. and China deferred tax assets.

Current wording

Benefit (expense) from income taxes consists of an estimate for U.S. federal, state, and foreign income taxes based on enacted rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities, and changes in the tax law. Due to cumulative losses, we maintain a valuation allowance against our definite-lived U.S. federal and state deferred tax assets, as well as our Australia, U.K. and China deferred tax assets.

Previous wording

The increase in direct-to-consumer net revenues, compared to the prior year comparative period, was due to an increase in Honey Birdette revenue as a result of the continued improvement in consumer perception of the Honey Birdette brand, which resulted in increased sales of both full-price and discounted products.

Current wording

Direct-to-consumer net revenues, compared to the prior year comparative period, remained largely consistent due to continued improvement in consumer perception of the Honey Birdette brand, which resulted in increased sales of full-price products, offset by lower sales of discounted products.

Previous wording

Corporate revenues for the three months ended June 30, 2025 related to corporate branding, including Playboy magazine and sponsorship events.

Current wording

Corporate revenues for the three months ended September 30, 2025 and 2024 related to corporate branding activities, primarily from payments for access to ouriPlayboy archives.

Previous wording

The decrease in all other net revenues, compared to the prior year comparative period, was primarily due to the licensing of our digital subscriptions and content operations to Byborg pursuant to the LMA, effective as of January 1, 2025. As a result, our previously reported Digital Subscriptions and Content operating and reportable segment was eliminated and its operations in the prior year comparative period were recast to be included in “All Other” for comparative purposes. “All Other” net revenues for the three months ended June 30, 2025 related to the amortization of deferred revenue balances that existed as of December 31, 2024 (prior to the LMA effective date of January 1, 2025) that pertain to previously reported digital subscriptions and content operations.

Current wording

The decrease in all other net revenues, compared to the prior year comparative period, was primarily due to the licensing of our digital subscriptions and content operations to Byborg pursuant to the LMA, effective as of January 1, 2025. As a result, our previously reported Digital Subscriptions and Content operating and reportable segment was eliminated and its operations in the prior year comparative period were recast to be included in “All Other” for comparative purposes. “All Other” net revenues for the three months ended September 30, 2025 related to the amortization of deferred revenue balances that existed as of December 31, 2024 (prior to the LMA effective date of January 1, 2025) that pertain to our previously reported digital subscriptions and content operations.

Previous wording

The increase in direct-to-consumer cost of sales, compared to the prior year comparative period, was primarily due to a $0.5 million increase in Honey Birdette’s product, shipping and fulfillment costs due to higher revenues. The increase in gross margin was due to continued improvement in consumer demand at Honey Birdette, increasing sales of both full-price and discounted products at a higher margin.

Current wording

The decrease in direct-to-consumer cost of sales, compared to the prior year comparative period, was primarily due to a $0.8 million decrease in Honey Birdette’s product, shipping and fulfillment costs due to lower sales of discounted products. The increase in gross profit and gross margin was due to continued improvement in consumer demand at Honey Birdette, which resulted in increased sales of full-price products at a higher margin.

Previous wording

The increase in licensing cost of sales and the corresponding decrease in gross margin, compared to the prior year comparative period, were primarily due to a $2.0 million increase in licensing commissions expense, reflecting a one-time settlement amount of $2.4 million to pay current and future commissions to a licensing agent, as well as a $0.9 million reduction in licensing product costs in the prior year comparative period due to the termination of Playboy’s e-commerce licensing agreement in the second quarter of 2024.

Current wording

The decrease in licensing cost of sales and the corresponding increase in gross margin, compared to the prior year comparative period, was primarily due to a $0.9 million increase in licensing product costs in the prior year comparative period due to the sale of inventory.

Previous wording

The decrease in all other cost of sales and gross margin, compared to the prior year comparative period, was primarily related to the licensing of our digital subscriptions and content operations to Byborg pursuant to the LMA, effective as of January 1, 2025, and the inclusion of transition expenses incurred pursuant to the TSA during the three months ended June 30, 2025.

Current wording

The decrease in all other cost of sales and increase in gross margin, compared to the prior year comparative period, was primarily related to the licensing of our digital subscriptions and content operations to Byborg pursuant to the LMA, effective as of January 1, 2025.

Previous wording

The decrease in selling and administrative expenses for the three months ended June 30, 2025, as compared to the prior year comparative period, was primarily due to a $1.2 million reduction in technology costs, a $0.9 million decrease in depreciation, a decrease in various professional services of $0.7 million, lower payroll expense of $0.9 million and a $0.3 million decrease in stock-based compensation expense, partly offset by $1.4 million in additional legal expenses related to ongoing material litigation, and severance and employee benefits expense of $0.4 million related to headcount reductions as a result of the transition of our digital operations into a licensing model.

Current wording

The decrease in selling and administrative expenses for the three months ended September 30, 2025, as compared to the prior year comparative period, was primarily due to lower payroll expense of $2.0 million and a $0.3 million decrease in stock-based compensation expense, mainly due to the transition of our digital operations into a licensing model, a decrease in various professional services of $0.8 million, lower rent expense of $0.7 million, lower bad debt expense of $0.4 million and a $0.3 million decrease in depreciation, partly offset by $0.6 million in additional legal expenses related to ongoing material litigation.

Previous wording

•Impairments for the three months ended June 30, 2025 related to impairment charges on our right-of-use assets related to our corporate leases.

Current wording

The decrease in impairments for the three months ended September 30, 2025, as compared to the prior year comparative period, was due to impairment charges recognized in the prior year comparative period of $17.0 million related to our goodwill and $4.7 million related to our internally developed software, partly offset by impairment charges on our artwork held for sale of $0.2 million in the third quarter of 2025.

Previous wording

The decrease in interest expense, net for the three months ended June 30, 2025, as compared to the prior year comparative period, was primarily due to a reduction of our debt balance and amortization of debt premium in connection with the A&R Third Amendment.

Current wording

The decrease in interest expense, net for the three months ended September 30, 2025, as compared to the prior year comparative period, was primarily due to a reduction of our debt balance and amortization of debt premium in connection with the A&R Third Amendment in 2024.

Previous wording

The change in other income (expense), net for the three months ended June 30, 2025, as compared to the prior year comparative period, was primarily due to unrealized gains and losses related to foreign currency transactions.

Current wording

The change in other income, net for the three months ended September 30, 2025, as compared to the prior year comparative period, was primarily due to unrealized gains and losses related to foreign currency transactions.

Previous wording

The increase in income taxes for the three months ended June 30, 2025, as compared to the prior year comparative period, was primarily driven by the change in valuation allowance due to the reduction in net indefinite-lived deferred tax liabilities, offset by increased foreign income taxes in the three months ended June 30, 2025.

Current wording

The change from expense to benefit from income taxes for the three months ended September 30, 2025, as compared to the prior year comparative period, was primarily driven by the change in valuation allowance due to the reduction in net indefinite-lived deferred tax liabilities, offset by increased foreign income taxes in the three months ended September 30, 2025.

Previous wording

The decrease in direct-to-consumer net revenues, compared to the prior year comparative period, was primarily due to a decrease in Honey Birdette revenue as a result of a large sale in March of 2024 that did not recur in March of 2025, as part of the broader initiative to improve margins and consumer perception of the Honey Birdette brand, partially offset by an increase in Honey Birdette revenue in the second quarter of 2025 as a result of improved consumer demand for Honey Birdette products.

Current wording

The decrease in direct-to-consumer net revenues, compared to the prior year comparative period, was primarily due to a decrease in Honey Birdette revenue as a result of a large sale in March of 2024 that did not recur in 2025, as part of the broader initiative to improve margins and consumer perception of the Honey Birdette brand.

Previous wording

The increase in licensing net revenues, compared to the prior year comparative period, was primarily due to $10.0 million of minimum guaranteed royalties recognized pursuant to the LMA, and a $2.8 million increase in minimum guarantees recognized from other licensing partners, out of which $1.8 million pertained to a licensing agreement with one of our Chinese licensees signed in the second quarter of 2024.

Current wording

The increase in licensing net revenues, compared to the prior year comparative period, was primarily due to $15.0 million of minimum guaranteed royalties recognized pursuant to the LMA, and a $2.1 million increase in minimum guarantees recognized from other licensing partners, out of which $2.2 million pertained to a licensing agreement with one of our Chinese licensees signed in the second quarter of 2024.

Previous wording

The increase in adjusted corporate expenses, compared to the prior year comparative period, was primarily due to expenses associated with Playboy magazine, events and sponsorships in 2025 that did not occur in the prior year comparative period.

Current wording

The increase in corporate revenues, compared to the prior year comparative period, was due to corporate branding activities related to Playboy magazine and sponsorship events, which did not occur in the prior year comparative period.

Previous wording

The decrease in all other net revenues, compared to the prior year comparative period, was primarily due to the licensing of our digital subscriptions and content operations to Byborg pursuant to the LMA, effective as of January 1, 2025. As a result, our previously reported Digital Subscriptions and Content operating and reportable segment was eliminated and its operations in the prior year comparative period were recast to be included in “All Other” for comparative purposes. “All Other” net revenues for the six months ended June 30, 2025 related to the amortization of deferred revenue balances that existed as of December 31, 2024 (prior to the LMA effective date of January 1, 2025) that pertain to previously reported digital subscriptions and content operations.

Current wording

The decrease in all other net revenues, compared to the prior year comparative period, was primarily due to the licensing of our digital subscriptions and content operations to Byborg pursuant to the LMA, effective as of January 1, 2025. As a result, our previously reported Digital Subscriptions and Content operating and reportable segment was eliminated and its operations in the prior year comparative period were recast to be included in “All Other” for comparative purposes. “All Other” net revenues for the nine months ended September 30, 2025 related to the amortization of deferred revenue balances that existed as of December 31, 2024 (prior to the LMA effective date of January 1, 2025) that pertain to our previously reported digital subscriptions and content operations.

Previous wording

The decrease in direct-to-consumer cost of sales and the increase in gross profit, compared to the prior year comparative period, was primarily due to a $1.7 million reduction in Honey Birdette’s product, shipping and fulfillment costs due to lower revenue, and improved gross margin was due to reduced promotional activity in the first and second quarters of 2025 as part of the broader initiative to improve margins and consumer perception of the Honey Birdette brand, as well as stronger sales of full-price Honey Birdette products.

Current wording

The decrease in direct-to-consumer cost of sales and the increase in gross profit, compared to the prior year comparative period, was primarily due to a $2.5 million reduction in Honey Birdette’s product, shipping and fulfillment costs due to lower sales of discounted products as a result of reduced promotional activity in 2025 as part of the broader initiative to improve margins and consumer perception of the Honey Birdette brand, which resulted in stronger sales of full-price products.

Previous wording

The increase in licensing cost of sales and corresponding decrease in gross margin, compared to the comparable prior year period, was primarily due to a $2.3 million increase in licensing commissions expense, reflecting a one-time settlement amount of $2.4 million to pay current and future commissions to a licensing agent, as well as a $0.9 million reduction in licensing product costs in the prior year comparative period due to the termination of Playboy’s e-commerce licensing agreement in the second quarter of 2024.

Current wording

The increase in licensing cost of sales and corresponding decrease in gross margin, compared to the comparable prior year period, was primarily due to a $2.2 million increase in licensing commissions expense, reflecting a one-time settlement amount of $2.4 million to pay current and future commissions to a licensing agent.

Previous wording

The corporate gross profit during the three months ended June 30, 2025, which was from our relaunch of Playboy magazine and sponsorship events, was immaterial. There were no activities related to Playboy magazine and sponsorship events in the prior year comparative period.

Current wording

Corporate gross profit during the nine months ended September 30, 2025, compared to the comparable prior year period, was primarily related to payments from access to ouriPlayboy archives, Playboy magazine and sponsorship events. There were no activities related to Playboy magazine and sponsorship events in the prior year comparative period.

Previous wording

The decrease in all other cost of sales and gross margin, compared to the comparable prior year period, was primarily related to the licensing of our digital subscriptions and content operations to Byborg pursuant to the LMA, effective as of January 1, 2025, and the inclusion of transition expenses incurred pursuant to the TSA during the six months ended June 30, 2025.

Current wording

The decrease in all other cost of sales and gross margin, compared to the comparable prior year period, was primarily related to the licensing of our digital subscriptions and content operations to Byborg pursuant to the LMA, effective as of January 1, 2025, and the inclusion of transition expenses incurred pursuant to the TSA during the nine months ended September 30, 2025.

Previous wording

Selling and administrative expenses for the six months ended June 30, 2025 were consistent with the prior year comparative period, primarily due to a $1.7 million decrease in technology costs, a $1.1 million decrease in depreciation, and a decrease in various professional services of $1.2 million, partly offset by $1.7 million of additional legal expenses related to ongoing material litigation and a $2.0 million increase in personnel costs largely due to severance and related compensation due to the transition of our digital operations into a licensing model.

Current wording

The decrease in selling and administrative expenses for the nine months ended September 30, 2025, compared to the prior year comparative period, was primarily due to a $1.7 million decrease in technology costs, a $1.4 million decrease in depreciation, a decrease in various professional services of $2.0 million, lower rent expense of $1.2 million, lower insurance cost of $0.3 million, lower payroll expense of $1.6 million and a $1.2 million decrease in stock-based compensation expense, partly offset by $2.4 million of additional legal expenses related to ongoing material litigation and an increase in severance and related compensation of $3.0 million due to the transition of our digital operations into a licensing model.

Previous wording

The decrease in impairments for the six months ended June 30, 2025, as compared to the prior year comparative period, was primarily due to a decrease of $2.1 million of impairment charges on our artwork held for sale, partly offset by a $0.9 million increase in impairment charges on our right-of-use assets related to our corporate leases.

Current wording

The decrease in impairments for the nine months ended September 30, 2025, as compared to the prior year comparative period, was primarily due to impairment charges recognized in the prior year comparative period of $17.0 million related to our goodwill and $4.7 million related to our internally developed software, as well as a decrease of $1.9 million in impairment charges on our artwork held for sale, partly offset by a $0.9 million increase in impairment charges on our right-of-use assets related to our corporate leases.

Previous wording

The change in other operating (expense) income, net, as compared to the prior year comparative period, was primarily due to the write off of certain property, plant and equipment items as a result of our decision to sublease certain of our office space.

Current wording

The increase in other operating expense, net, as compared to the prior year comparative period, was primarily due to the write off of certain property, plant and equipment items in the second quarter of 2025 as a result of our decision to sublease certain of our office space.

Previous wording

The decrease in interest expense, net for the six months ended June 30, 2025, as compared to the prior year comparative period, was primarily due to a reduction of our debt balance and amortization of debt premium in connection with the A&R Third Amendment.

Current wording

The decrease in interest expense, net for the nine months ended September 30, 2025, as compared to the prior year comparative period, was primarily due to a reduction of our debt balance and amortization of debt premium in connection with the A&R Third Amendment in 2024.

Previous wording

Increase in expense from income taxes for the six months ended June 30, 2025, as compared to the prior year comparative period, was primarily driven by the change in valuation allowance due to a reduction in net indefinite-lived deferred tax liabilities, offset by increased foreign income taxes in the six months ended June 30, 2025.

Current wording

The decrease in expense from income taxes for the nine months ended September 30, 2025, as compared to the prior year comparative period, was primarily driven by the change in valuation allowance due to a reduction in net indefinite-lived deferred tax liabilities, offset by increased foreign income taxes in the nine months ended September 30, 2025.

Previous wording

The following table reconciles net loss to EBITDA and Adjusted EBITDA (in thousands):

Current wording

The following table reconciles net income (loss) to EBITDA and Adjusted EBITDA (in thousands):

Previous wording

•Licensing commissions settlement for thethree and six months ended June 30, 2025 represents a one-time settlement amount of $2.4 million to pay current and future commissions to a licensing agent, which will be paid in the third quarter of 2025.

Current wording

•Licensing commissions settlement for the nine months ended September 30, 2025 represents a one-time settlement amount of $2.4 million to pay current and future commissions to a licensing agent, which will be fully paid by the end of 2025.

Previous wording

•Transition expenses for the three and six months ended June 30, 2025 represent costs associated with the digital operations licensed to Byborg, solely during the transition period pursuant to the TSA.

Current wording

•Transition expenses for the nine months ended September 30, 2025 represent costs associated with the digital operations licensed to Byborg, solely during the transition period pursuant to the TSA.

Previous wording

•Severance expenses for the three and six months ended June 30, 2025 were due to the reduction of headcount related to the transition of our digital subscriptions and content operations into a licensing model.

Current wording

•Severance expenses for the three and nine months ended September 30, 2025 were primarily due to the reduction of headcount related to the transition of our digital subscriptions and content operations into a licensing model.

Previous wording

The increase in impairments for the three months ended June 30, 2025, as compared to the prior year comparative period, was due to impairment charges on our right-of-use assets related to our corporate leases that were $0.9 million higher than in the prior year comparative period.

Current wording

•Impairments for the three months ended September 30, 2025 related to impairment charges on our artwork held for sale.