Paradium.AI, Inc.

Previous wording

The following discussion and analysis of our financial condition and results of operations for the three and nine months ended September 30, 2024 and2023should be read together with our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report and in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2023 included in the Annual Report on Form 10-K filed with the SEC on April 1, 2024. The following discussion contains “forward-looking statements” that reflect our future plans, estimates, beliefs and expected performance. Our actual results may differ materially from those currently anticipated and expressed in such forward-looking statements as a result of a number of factors. We caution that assumptions, expectations, projections, intentions or beliefs about future events may, and often do, vary from actual results and the differences can be material. Please see “Forward-Looking Statements.”

Current wording

The following discussion and analysis of our financial condition and results of operations for the three months ended March 31, 2025 and2024should be read together with our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report and in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2024 included in the Annual Report on Form 10-K filed with the SEC on April 15, 2025. The following discussion contains “forward-looking statements” that reflect our future plans, estimates, beliefs and expected performance. Our actual results may differ materially from those currently anticipated and expressed in such forward-looking statements as a result of a number of factors. We caution that assumptions, expectations, projections, intentions or beliefs about future events may, and often do, vary from actual results and the differences can be material. Please see “Forward-Looking Statements.”

Previous wording

We are a media company that leverages technology to build deep content verticals powered by anchor brands and a best-in-class digital media platform (the “Platform”) empowering publishers who impact, inform, educate, and entertain. Our strategy is to focus on key subject matter verticals where audiences are passionate about a topic category (e.g., sports and finance) where we can leverage the strength of our core brands to grow our audience and increase monetization both within our core brands as well as for our media publisher partners (each, a “Publisher Partner”). Our focus is on leveraging our Platform and brands in targeted verticals to maximize audience reach, enhance engagement, and optimize monetization of digital publishing assets for the benefit of our users, our advertiser clients, and our greater than 40 owned and operated properties as well as properties we run on behalf of independent Publisher Partners. We own and operateAthlon Sports, TheStreet, The Spun, Parade, and Men’s Journal and power more than 360 independent Publisher Partners, including the many sports team sites that contribute to Athlon Sports.

Current wording

The Arena Group Holdings, Inc. (the “Company,” “Arena Group,” “we,” “our,” or “us”), is a media company that leverages technology to build deep content verticals powered by anchor brands and a best-in-class digital media platform (the “Platform”) empowering publishers who impact, inform, educate, and entertain. Our strategy is to focus on key subject matter verticals where audiences are passionate about a topic category (e.g., sports & leisure, lifestyle, and finance) where we can leverage the strength of our core brands to grow our audience and increase monetization both within our core brands as well as for our media publisher partners (each, a “Publisher Partner”). Our focus is on leveraging our Platform and brands in targeted verticals to maximize audience reach, enhance engagement, and optimize monetization of digital publishing assets for the benefit of our users, our advertiser clients, and our greater than 20 owned and operated properties as well as properties we run on behalf of independent Publisher Partners. We own and operate Athlon Sports, TheStreet, The Spun, Parade, Men’s Journal, HubPages, Men’s Fitness, Autoblog, and Adventure Network, and also power more than 150 independent Publisher Partners.

Previous wording

Each Publisher Partner joins the Platform by invitation only with the objective of improving our position in key verticals while optimizing the performance of the Publisher Partner. Publisher Partners incur the costs in content creation on their respective channels and receive a share of the revenue associated with their content. Because of the state-of-the-art technology and large scale of the Platform and our expertise in search engine optimization, social media, ad monetization and subscription marketing, Publisher Partners continually benefit from our ongoing technological advances and audience development expertise. Additionally, we believe the lead brands within our verticals create a halo benefit for all Publisher Partners while each of them adds to the breadth and quality of content. While the Publisher Partners benefit from these critical performance improvements they may also save substantial technology, infrastructure, advertising sales, member marketing and management costs.

Current wording

Each Publisher Partner joins the Platform by invitation only with the objective of improving our position in key verticals while optimizing the performance of the Publisher Partner. Publisher Partners incur the costs in content creation on their respective channels and receive a share of the revenue associated with their content. Because of the state-of-the-art technology and large scale of the Platform and our expertise in search engine optimization, social media, ad monetization and subscription marketing, Publisher Partners continually benefit from our ongoing technological advances and audience development expertise. While the Publisher Partners benefit from these critical performance improvements, they may also save substantial technology, infrastructure, advertising sales, member marketing and management costs. While the Publisher Partners benefit from these critical performance improvements, they may also save substantial technology, infrastructure, advertising sales, member marketing and management costs. Additionally, we believe the lead brands within our verticals create a halo benefit for all Publisher Partners while each of them adds to the breadth and quality of content.

Previous wording

Of the more than 360 Publisher Partners, a large majority of them publish content within one of our four verticals of sports, finance, lifestyle and men’s lifestyle, and oversee an online community for their respective sites, leveraging our Platform, monetization operation, distribution channels and data and analytics offerings and benefiting from our ability to engage the collective audiences within a single network. Generally, Publisher Partners are independently owned, strategic partners who receive a share of revenue from the interaction with their content. Audiences expand and advertising revenue may improve due to the scale we have achieved by combining all Publisher Partners into a single platform and a large and experienced sales organization. They also benefit from our membership marketing and management systems, which we believe will enhance their revenue.

Current wording

Of the more than 150 Publisher Partners, a majority of them publish content which aligns with one of our four verticals (sports &leisure, finance, lifestyle and platform), and oversee an online community for their respective sites, leveraging our Platform, monetization operation, distribution channels and data and analytics offerings, and benefiting from our ability to engage the collective audiences within a single network. Generally, Publisher Partners are independently owned, strategic partners who receive a share of revenue from the interaction with their content. Audiences expand and advertising revenue may improve due to the scale we have achieved by combining all Publisher Partners into a single platform and a large and experienced sales organization. They also benefit from our membership marketing and management systems, which we believe will enhance their revenue.

Previous wording

Uncertainty in the global economy presents significant risks to our business. Increases in inflation, instability in the global banking system, geopolitical factors, including the ongoing conflicts in Ukraine and Israel and the responses thereto may have an adverse effect on our business. While we are closely monitoring the impact of the current macroeconomic conditions on all aspects of our business, the ultimate extent of the impact on our business remains highly uncertain and will depend on future developments and factors that continue to evolve. Most of these developments and factors are outside of our control and could exist for an extended period of time. As a result, we are subject to continuing risks and uncertainties. For additional information, see the sections titled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on April 1, 2024 and in this Quarterly Report.

Current wording

Uncertainty in the global economy presents significant risks to our business. Increases in inflation, instability in the global banking system, geopolitical factors, including the ongoing conflicts in Ukraine and Israel and the responses thereto, and the impact of tariffs on print production costs and the overall market for advertising may have an adverse effect on our business. While we are closely monitoring the impact of the current macroeconomic conditions on all aspects of our business, the ultimate extent of the impact on our business remains highly uncertain and will depend on future developments and factors that continue to evolve. Most of these developments and factors are outside of our control and could exist for an extended period of time. As a result, we are subject to continuing risks and uncertainties. For additional information, see the sections titled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on April 15, 2025 and in this Quarterly Report.

Previous wording

We monitor and review our key operating metrics as we believe that these metrics are relevant for our industry and specifically to us and to understanding our business. Moreover, they form the basis for trends informing certain predictions related to our financial condition. Our key operating metrics focus primarily on our digital advertising revenue, which has experienced significant growth in recent periods. As indicated in the Results of Operations section below, for the three months ended September 30, 2024, digital advertising revenue decreased by approximately 19%, as compared to the same period in fiscal 2023. For the nine months ended September 30, 2024, digital advertising revenue decreased by approximately 6%, as compared to the same period in 2023. Management monitors and reviews these metrics because such metrics are readily measurable in real time and can provide valuable insight into the performance of and trends related to our digital advertising revenue and our overall business. We consider only those key operating metrics described here to be material to our financial condition, results of operations and future prospects.

Current wording

We monitor and review our key operating metrics as we believe that these metrics are relevant for our industry and specifically to us and to understanding our business. Moreover, they form the basis for trends informing certain predictions related to our financial condition. Our key operating metrics focus primarily on our digital advertising revenue, which is our most significant revenue stream. As indicated in the Results of Operations section below, for the three months ended March 31, 2025, digital advertising revenue decreased by approximately 4%, as compared to the same period in fiscal 2024. Management monitors and reviews these metrics because such metrics are readily measurable in real time and can provide valuable insight into the performance of and trends related to our digital advertising revenue and our overall business. We consider only those key operating metrics described here to be material to our financial condition, results of operations and future prospects.

Previous wording

For the three and nine months ended September 30, 2024, our RPM was $24.69 and $22.27, respectively. For the three and nine months ended September 30, 2023, our RPM was $23.41 and $19.60, respectively. The 5% and 14% increases in RPM for the three and nine months reflect a significant increase in video advertising as a percentage of total digital advertising as digital video advertising is sold at a significantly higher price than digital display advertising.

Current wording

For the three months ended March 31, 2025 and 2024, our RPM was $22.21 and $18.56, respectively. The 20% increase in RPM reflects an increase in video advertising as a percentage of total digital advertising as digital video advertising is sold at a significantly higher price than digital display advertising. For the three months ended March 31, 2025 and 2024, our monthly average pageviews were 327,510,084 and 286,009,299 respectively. The 15% increase in monthly average pageviews is primarily driven by upside in traffic and audience.

Previous wording

For the nine months ended September 30, 2024, we incurred a net loss from continuing operations of $14,880, and as of September 30, 2024, had cash on hand of $5,773 and a working capital deficit of $209,596. Management has evaluated our net loss from continuing operations and working capital deficit to determine if the significance of those conditions or events would limit our ability to meet our obligations when due, including under the Loan Documents and Simplify Loan (further details are provided in the accompanying condensed consolidated financial statements in Notes 10 and 12). In our evaluation, management determined that substantial doubt exists about our ability to continue as a going concern for a one-year period following the financial statement issuance date due to the net loss from continued operations and working capital deficit.

Current wording

For the three months ended March 31, 2025, we had net income from continuing operations of $3,997, and as of March 31, 2025, had cash on hand of $2,902 and a working capital deficit of $80,622. Management has evaluated our working capital deficit and historical losses to determine if the significance of those conditions or events would limit our ability to meet our obligations when due, including under the Simplify Loan and Term Debt (as defined in our accompanying condensed consolidated financial statement in Notes 8 and 9). In its evaluation, management determined that substantial doubt exists about our ability to continue as a going concern for a one-year period following the financial statement issuance date due our historical losses and working capital deficit.

Previous wording

Our financial results have improved in recent periods due to restructuring activities and implementation of a new operating structure. In addition, we plan to continue improving monthly financial performance through the reduction of costs and monthly cash requirements, maintain compliance with the terms of all outstanding debt agreements, and take actions to resolve current and potential future liabilities to alleviate the conditions that raise substantial doubt about its ability to continue as a going concern, such as resolving pending litigation. However, there can be no assurance that we will be able to execute these plans. If we are unable to execute these plans, it could lead to selling assets and further reducing costs and cash requirements.

Current wording

Our financial results have improved in recent periods due to headcount and consulting spend reductions. In addition, we are planning to continue improving monthly financial performance through the reduction of costs and monthly cash requirements, maintain compliance with the terms of all outstanding debt agreements, and take actions to resolve current and potential future liabilities to alleviate the conditions that raise substantial doubt about our ability to continue as a going concern, such as resolving pending litigation. However, there can be no assurance that we will be able to execute these plans. If we are unable to execute these plans, it could lead to selling assets and further reducing costs and cash requirements.

Previous wording

As of September 30, 2024, our principal sources of liquidity consisted of cash of $5,773 and accounts receivable from continuing operations, net of our allowance for credit losses, of $25,858. In addition, as of September 30, 2024, we had $48,900 available for additional use under our working capital loan with Simplify. As of September 30, 2024, the outstanding balance of the Simplify working capital loan was $1,100. Our cash balance as of the issuance date of our accompanying condensed consolidated financial statements is $7,085.

Current wording

As of March 31, 2025, our principal sources of liquidity consisted of cash of $2,902 and accounts receivable from continuing operations, net of our allowance for credit losses, of $31,561. In addition, as of March 31, 2025, we had $42,849 available for additional use under our working capital loan with Simplify. As of March 31, 2025, the outstanding balance of the Simplify working capital loan was $7,151. Our cash balance as of the issuance date of our accompanying condensed consolidated financial statements is $2,869.

Previous wording

We have material contractual obligations that arise in the normal course of business primarily consisting of employment contracts, consulting agreements, leases, liquidated damages, debt and related interest payments. Purchase obligations consist of contracts primarily related to merchandise, equipment, and third-party services, the majority of which are due in the next 12 months. See Notes 5, 8, 10, 11 and 12 in our accompanying condensed consolidated financial statements for amounts outstanding as of September 30, 2024, related to leases, liquidated damages, working capital loan, bridge notes and debt, respectively. During 2022, we assumed the lease from Men’s Journal for office space in Carlsbad, California, that expires in March 2025, and we remain responsible for $720 over the lease term. The lease provides for fixed payments ranging from $89 to $94 over the remainder of the lease term, with an estimate of common expenses per month of $25 through the end of the lease term. Other than with respect to leases, as described in Note 5,Leases, in our accompanying condensed consolidated financial statements, there have been no material changes from the disclosures in our Annual Report on Form 10-K for the year ended December 31, 2023.

Current wording

We have material contractual obligations that arise in the normal course of business primarily consisting of employment contracts, consulting agreements, leases, liquidated damages, debt and related interest payments. Purchase obligations consist of contracts primarily related to merchandise, equipment, and third party services, the majority of which are due in the next 12 months. See Note 4,Leases, Note 6,Liquidated Damages Payable, and Note 8,Simplify Loan and Note 9,Term Debt, in our accompanying condensed consolidated financial statements for amounts outstanding as of March 31, 2025, related to other material contractual obligations.

Previous wording

In connection with our discontinued operations from the discontinuance of the Sports Illustrated media business, we recorded the termination fee liability of $45,000 and recognized a loss on impairment of assets of $39,391 for the nine months ended September 30, 2024. As a result of this discontinuance, our total liabilities from the discontinued operations were $98,378, partially offset by our total assets from discontinued operations of $528 as of September 30, 2024.

Current wording

In connection with our discontinued operations from the discontinuance of the Sports Illustrated media business, we recorded the termination fee liability of $45,000 and recognized a loss on impairment of assets of $39,391 for the three months ended March 31, 2024. As a result of this discontinuance, our total liabilities from the discontinued operations were $96,056 as of March 31, 2025.

Previous wording

Loss from our discontinued operations, net of tax, was $92,709 and $15,204 for the nine months ended September 30, 2024 and 2023, respectively.

Current wording

Income (loss) from our discontinued operations, net of tax, was $23 and ($90,638) for the three months ended March 31, 2025 and 2024, respectively.

Previous wording

Further details are provided in our accompanying condensed consolidated financial statements in Note 2,*Discontinued Operations,*related to our discontinued operations and Note 19,Commitments and Contingencies, regarding our legal matters and an action filed by ABG Group against the Company and Manoj Bhargava on April 1, 2024.

Current wording

Further details are provided in our accompanying condensed consolidated financial statements in Note 2,Discontinued Operations, related to our discontinued operations and Note 18,Subsequent Events, regarding the settlement of an action filed by ABG Group against the Company and Manoj Bhargava on April 1, 2024.

Previous wording

As of September 30, 2024, we had a working capital deficit of $209,596, as compared to $145,622 as of December 31, 2023, consisting of $37,834 in total current assets and $247,430 in total current liabilities. As of December 31, 2023, our working capital deficit consisted of $90,399 in total current assets and $236,021 in total current liabilities.

Current wording

As of March 31, 2025, we had a working capital deficit of $80,622, as compared to $82,022 as of December 31, 2024, consisting of $39,145 in total current assets and $119,767 in total current liabilities. As of December 31, 2024, our working capital deficit consisted of $40,234 in total current assets and $122,256 in total current liabilities.

Previous wording

Our cash flows for the nine months ended September 30, 2024 and 2023 consisted of the following:

Current wording

Our cash flows for the three months ended March 31, 2025 and 2024 consisted of the following:

Previous wording

For the nine months ended September 30, 2024, net cash used in operating activities was $7,507, consisting primarily of $124,161 of cash paid to employees, Publisher Partners, expert contributors, suppliers, and vendors, and for revenue share arrangements, professional services, and $2,698 of cash paid for interest, offset by $119,352 of cash received from customers. For the nine months ended September 30, 2023, net cash used in operating activities was $22,265, consisting primarily of $179,166 of cash paid to employees, Publisher Partners, expert contributors, suppliers, and vendors, and for revenue share arrangements, advance of royalty fees and professional services, and $10,835 of cash paid for interest, offset by $167,736 of cash received from customers.

Current wording

For the three months ended March 31, 2025, net cash provided by operating activities was $3,662, consisting primarily of $30,272 of cash received from customers, offset by $23,637 of cash paid to employees, Publisher Partners, expert contributors, suppliers, and vendors, and for revenue share arrangements, professional services, and $2,973 of cash paid for interest. For the three months ended March 31, 2024, net cash used in operating activities was $1,965, consisting primarily of $57,633 of cash paid to employees, Publisher Partners, expert contributors, suppliers, and vendors, and for revenue share arrangements, professional services, and $964 of cash paid for interest, offset by $56,632 of cash received from customers.

Previous wording

For the nine months ended September 30, 2024, net cash used in investing activities was $2,819 consisting of (i) $54 for purchase of property and equipment and (ii) $2,765 for capitalized costs for our Platform. For the nine months ended September 30, 2023, net cash used in investing activities was $3,467, consisting of $2,967 for capitalized costs for our Platform and $500 for the acquisition of a business.

Current wording

For the three months ended March 31, 2025, net cash used in investing activities consisted of $1,618 for capitalized costs for our Platform. For the three months ended March 31, 2024, net cash used in investing activities was $713 consisting of capitalized costs for our Platform.

Previous wording

For the nine months ended September 30, 2024, net cash provided by financing activities was $6,815, primarily consisting of (i) $561 for the payment of the contingent consideration, (ii) $20,027 from repayment of our line of credit with SLR Digital Finance LLC (“SLR”) and (iii) $497 for tax payments relating to the withholding of shares of common stock for certain employees, less (iv) $12,000 in net proceeds from the common stock private placement, and (v) $16,100 in net proceeds from our working capital loan with Simplify. For the nine months ended September 30, 2023, net cash provided by financing activities was $18,649, consisting primarily of $11,500 (before a reduction for accrued offering costs of $167) in net proceeds from the public offering of common stock and $3,211 from borrowings under our SLR line of credit, $5,703 (excluding debt issuance costs of $100) in net proceeds from issuance of notes; offset by $1,423 tax payments relating to the withholding of shares of common stock for certain employees, and $75 payment of deferred cash payments.

Current wording

For the three months ended March 31, 2025, net cash used in financing activities was $3,504, consisting of (i) $4 for tax payments relating to the withholding of shares of common stock for certain employees, and (ii) $3,500 for repayments of the Simplify Loan. For the three months ended March 31, 2024, net cash used in financing activities was $2,603, consisting of (i) $2,263 for the payment of the Fexy put option, (ii) $19,609 from repayment of our line of credit with SLR Digital Finance LLC (“SLR”) and (iii) $479 for tax payments relating to the withholding of shares of common stock for certain employees, less (iv) $12,000 in net proceeds from the common stock private placement, and (v) $7,748 in net proceeds from our working capital loan with Simplify.

Previous wording

For the three months ended September 30, 2024, the net income from continuing operations improved $13,550 to $4,778 as compared to our prior period net loss of $8,772. This improvement was primarily due to a $9,478 decrease in operating expenses and an increase in gross profit of $3,043.

Current wording

For the three months ended March 31, 2025, the net income from continuing operations improved $16,717 to $3,997, as compared to our prior period net loss of $12,720. This improvement was primarily due to a $8,577 decrease in operating expenses as a result of headcount and consulting spend reductions.

Previous wording

For the three months ended September 30, 2024 we had gross profit of $16,993, as compared to $13,950 for the three months ended September 30, 2023, an increase of $3,043. Gross profit percentage for the three months ended September 30, 2024 was 50.6%, as compared to 37.7% for the three months ended September 30, 2023.

Current wording

For the three months ended March 31, 2025, we had gross profit of $15,669, as compared to $8,933 for the three months ended March 31, 2024, an increase of $6,736. Gross profit percentage for the three months ended March 31, 2025 was 49.3%, as compared to 30.9% for the three months ended March 31, 2024.

Previous wording

For the nine months ended September 30, 2024, we recognized cost of revenue of $53,035, as compared to $61,991 for the nine months ended September 30, 2023, which represents a decrease of $8,956. Cost of revenue for the nine months ended September 30, 2024 was impacted by decreases in printing, distribution and fulfillment costs of $1,919, stock-based compensation costs of $2,728, amortization of developed technology and platform development costs of $2,353, technology, Platform and software licensing fees of $1,829, and Publisher Partner revenue share payments of $2,000; partially offset by increases in content and editorial expenses of $1,511.

Current wording

For the three months ended March 31, 2025, we recognized cost of revenue of $16,146 as compared to $20,008 for the three months ended March 31, 2024, representing a decrease of $3,862. Cost of revenue for the three months ended March 31, 2025 was impacted by decreases in printing, distribution and fulfillment costs of $67 due to the shutdown of Athlon Outdoor print operations, amortization of developed technology and platform development costs of $273, technology costs of $1,053, internal cost of content of $181, and external cost of content of $2,262 driven by the cessation of publishing of FanNation sites in early 2024, and a decrease in other costs of revenue of $26.

Previous wording

For the nine months ended September 30, 2024, we incurred selling and marketing costs of $10,326, as compared to $19,173 for the nine months ended September 30, 2023. The decrease in selling and marketing costs of $8,847 is primarily related to decreases in payroll and employee benefits costs of $4,380 due to restructuring activities and reduction in direct sales workforce. In addition, decreases were noted in professional marketing services of $2,644, advertising costs of $492, circulation costs of $732, and stock based compensation of $772; partially offset by other selling and marketing expenses of $174.

Current wording

For the three months ended March 31, 2025, we incurred selling and marketing costs of $2,134 as compared to $4,564 for the three months ended March 31, 2024. The decrease in selling and marketing costs of $2,430 is primarily related to decreases in payroll and employee benefits costs of $1,991 due to a reduction in direct sales workforce. In addition, there were decreases in advertising costs of $283, circulation costs of $47, stock-based compensation of $83, and other selling and marketing expenses of $234, partially offset by an increase in professional marketing services of $208.

Previous wording

For the nine months ended September 30, 2024, we incurred general and administrative costs of $24,790 as compared to $35,516 for the nine months ended September 30, 2023. The $10,726 decrease in general and administrative expenses is primarily due to decreases in stock-based compensation of $9,473, payroll and related expenses of $1,258, and other general and administrative expenses of $1,136; partially offset by an increase in professional services, including accounting, legal and insurance of $1,141.

Current wording

For the three months ended March 31, 2025, we incurred general and administrative costs of $5,283 as compared to $10,135 for the three months ended March 31, 2024. The $4,852 decrease in general and administrative expenses is primarily due to decreases in stock-based compensation of $332, and payroll and related expenses of $2,950 as a result of headcount and consulting spend reductions, professional services, including accounting, legal and insurance of $840, and other general and administrative expenses of $730.

Previous wording

Change in Fair Value of Contingent Consideration. The change in fair value of contingent consideration for the nine months ended September 30, 2024 of $313, represents the change in the put option on our common stock in connection with the Fexy Studios acquisition.

Current wording

Change in Fair Value of Contingent Consideration – The change in fair value of contingent consideration for the three months ended March 31, 2024 of $313, represents the change in fair value of the put option on our common stock in connection with the acquisition of Fexy, where in connection with the acquisition we issued 274,692 shares of our common stock that was subject to a put option under certain conditions (as further described in Note 7,Fair Value, in our accompanying condensed consolidated financial statements).

Previous wording

We report our financial results in accordance with generally accepted accounting principles in the United States of America (“GAAP”); however, management believes that certain non-GAAP financial measures provide users of our financial information with useful supplemental information that enables a better comparison of our performance across periods. We believe Adjusted EBITDA provides visibility to the underlying continuing operating performance by excluding the impact of certain items that are noncash in nature or not related to our core business operations. We calculate Adjusted EBITDA as net loss as adjusted for net loss from discontinued operations, with additional adjustments for (i) interest expense (net), (ii) income taxes, (iii) depreciation and amortization, (iv) stock-based compensation, (v) change in valuation of contingent consideration; (vi) liquidated damages, (vii) loss on impairment of assets, (viii) employee retention credit, and (ix) employee restructuring payments.

Current wording

We report our financial results in accordance with generally accepted accounting principles in the United States of America (“GAAP”); however, management believes that certain non-GAAP financial measures provide users of our financial information with useful supplemental information that enables a better comparison of our performance across periods. We believe Adjusted EBITDA provides visibility to the underlying continuing operating performance by excluding the impact of certain items that are noncash in nature or not related to our core business operations. We calculate Adjusted EBITDA as net loss as adjusted for loss from discontinued operations, with additional adjustments for (i) interest expense (net), (ii) income taxes, (iii) depreciation and amortization, (iv) stock-based compensation, (v) change in valuation of contingent consideration, (vi) liquidated damages, (vii) loss on impairment of assets, (viii) loss on sale of assets; (ix) employee retention credit, (x) employee restructuring payments; and (xi) professional and vendor fees. Our non-GAAP measure may not be comparable to similarly titled measures used by other companies, have limitations as an analytical tool, and should not be considered in isolation, or as a substitute for analysis of our operating results as reported under GAAP. Additionally, we do not consider our non-GAAP measures as superior to, or a substitute for, the equivalent measure calculated and presented in accordance with GAAP. Some of the limitations are that our non-GAAP measure:

Previous wording

The following table presents a reconciliation of Adjusted EBITDA to net loss, which is the most directly comparable GAAP measure, for the periods indicated:

Current wording

The following table presents a reconciliation of Adjusted EBITDA to net income (loss), which is the most directly comparable GAAP measure, for the periods indicated: