Lionsgate Studios Corp.

Previous wording

Lionsgate Studios Corp. (NYSE: LION) (the “Company,” “Lionsgate,” “New Lionsgate,” “we,” “us” or “our”) is one of the world’s leading standalone, pure play content companies. It brings together diversified motion picture and television production and distribution businesses, a world-class portfolio of valuable brands and franchises, a talent management and production powerhouse and a more than 20,000-title film and television library, all driven by Lionsgate’s bold and entrepreneurial culture.

Current wording

Lionsgate Studios Corp. is one of the world’s leading standalone, pure play content companies. We bring together diversified motion picture and television production and distribution businesses, a world-class portfolio of valuable brands and franchises, a talent management and production powerhouse and a film and television library with more than 20,000 titles, all driven by Lionsgate’s bold and entrepreneurial culture.

Previous wording

Our revenues are derived from the Motion Picture and Television Production segments, as described below. Our revenues are derived from the U.S., Canada, the United Kingdom and other foreign countries. None of the non-U.S. countries individually comprised greater than 10% of total revenues for the three and nine months ended December 31, 2025 and 2024.

Current wording

Our revenues are generated by the Motion Picture and Television Production segments, collectively referred to as our Studio Business. Revenues are earned in the United States (“U.S.”), Canada, the United Kingdom and other foreign countries. No individual foreign country accounted for more than 10% of total revenue during the three months ended June 30, 2026 or 2025.

Previous wording

Motion Picture: Our Motion Picture segment includes revenues derived from the following:

Current wording

Motion Picture: Our Motion Picture segment includes revenue generated from the following:

Previous wording

•Theatrical. Theatrical revenues are derived from the domestic theatrical release of motion pictures licensed to theatrical exhibitors on a picture-by-picture basis (distributed by us directly in the U.S. and through a sub-distributor in Canada). The revenues from Canada are reported net of distribution fees and release expenses of the Canadian sub-distributor. The financial terms that we negotiate with our theatrical exhibitors in the U.S. generally provide that we receive a percentage of the box office results. Theatrical revenues also include revenues from licenses to direct-to-platform customers where the initial license of a motion picture is to a direct-to-platform customer.

Current wording

•Theatrical. Theatrical revenue is generated from the domestic theatrical release of motion pictures licensed to theatrical exhibitors on a title-by-title basis. In the U.S., we distribute films directly, while in Canada films are distributed through a sub-distributor. The revenues from Canada are reported net of distribution fees and release expenses. Under the arrangements with our exhibitors we generally receive a percentage of the box office results. Theatrical revenues also include revenue from certain direct-to-platform licenses where the initial license of a motion picture is to a direct-to-platform customer.

Previous wording

•Home Entertainment. Home entertainment revenues are derived from the sale or rental of our film productions and acquired or licensed films and certain television programs (including theatrical and direct-to-video releases) on packaged media and through digital media platforms (including pay-per-view and video-on-demand platforms, electronic sell through, and digital rental). In addition, we have revenue sharing arrangements with certain digital media platforms which generally provide that, in exchange for a nominal or no upfront sales price, we share the rental or sales revenues generated by the platform on a title-by-title basis.

Current wording

•Home Entertainment. Home entertainment revenue is generated from the sale or rental of our film productions and acquired or licensed films and certain television programs, including theatrical and direct-to-video releases, on packaged media and through digital media platforms, such as pay-per-view, video-on-demand, electronic sell through and digital rental services. Home Entertainment revenue also includes amounts earned under revenue sharing arrangements with certain digital media platforms, under which we generally share in the rental or sales proceeds generated on a title-by-title basis in exchange for a nominal or no upfront sales price.

Previous wording

•Television. Television revenues are primarily derived from the licensing of our theatrical productions and acquired films to the linear pay, basic cable and free television markets. In addition, when a license in our traditional pay television window is made to a subscription video-on-demand (“SVOD”) or other digital platform, the revenues are included here.

Current wording

•Television. Television revenue is primarily generated from the licensing of our theatrical productions and acquired films to linear pay, basic cable and free television markets. Television revenue also includes revenue from licenses in our traditional pay television window granted to subscription video-on-demand (“SVOD”) and other digital platforms.

Previous wording

•International. International revenues are derived from (1) licensing of our productions, acquired films, our catalog product and libraries of acquired titles to international distributors, on a territory-by-territory basis; and (2) the direct distribution of our productions, acquired films, and our catalog product and libraries of acquired titles in the United Kingdom.

Current wording

•International. International revenue is generated from the licensing to international distributors on a territory-by-territory basis, and the direct distribution in the United Kingdom, of our productions, acquired films, our catalog product and libraries of acquired titles.

Previous wording

•Other. Other revenues are derived from, among others, the licensing of our film and television and related content (games, music, location-based entertainment royalties, etc.) to other ancillary markets.

Current wording

•Other. Other revenue is primarily generated from the licensing of our film, television and related content, such as games, music and location-based entertainment royalties, to ancillary markets.

Previous wording

Television Production: Our Television Production segment includes revenues derived from the following.

Current wording

Television Production: Our Television Production segment includes revenue generated from the following:

Previous wording

•Television. Television revenues are derived from the licensing to domestic markets (linear pay, basic cable, free television and syndication) of scripted and unscripted series, television movies, mini-series and non-fiction programming. Television revenues also include revenue from licenses to SVOD platforms in which the initial license of a television series is to an SVOD platform. Television revenues include fixed fee arrangements as well as arrangements in which we earn advertising revenue from the exploitation of certain content on television networks.

Current wording

•Television. Television revenue is generated from the licensing of scripted and unscripted series, television movies, mini-series and non-fiction programming to domestic linear pay, basic cable, free television and syndication markets. Television revenue also includes revenue from licenses to SVOD platforms when the initial license of a television series is granted to an SVOD platform. Television revenue includes both fixed fee arrangements and arrangements in which we earn advertising revenue from the exploitation of certain content on television networks.

Previous wording

•International. International revenues are derived from the licensing and syndication to international markets of scripted and unscripted series, television movies, mini-series and non-fiction programming.

Current wording

•International. International revenue is generated from the licensing and syndication to international markets of scripted and unscripted series, television movies, miniseries and non-fiction programming.

Previous wording

•Home Entertainment. Home entertainment revenues are derived from the sale or rental of television production movies or series on packaged media and through digital media platforms.

Current wording

•Home Entertainment. Home entertainment revenue is generated from the sale or rental of television production movies or series on packaged media and through digital media platforms.

Previous wording

•Other. Other revenues are derived from, among others, the licensing of our television programs to other ancillary markets, the sales and licensing of music from the television broadcasts of our productions, and from commissions and executive producer fees earned related to talent management.

Current wording

•Other. Other revenue is generated from the licensing of our television programs to other ancillary markets, the sales and licensing of music from the television broadcasts of our productions, and from commissions and executive producer fees earned related to talent management.

Previous wording

Direct operating expenses include amortization of film and television production or acquisition costs, participation and residual expenses, provision for doubtful accounts, and foreign exchange gains and losses.

Current wording

Direct operating expenses include amortization of film and television production or acquisition costs, participation and residual expenses, provision for credit losses, and foreign exchange gains and losses.

Previous wording

Participation costs represent consideration payable based on the performance of the film or television program to parties associated with the film or television program, including producers, writers, directors and actors. Residuals represent amounts payable to various unions or “guilds” such as the Screen Actors Guild - American Federation of Television and Radio Artists, Directors Guild of America, and Writers Guild of America, based on the performance of the film or television program in certain ancillary markets or based on the individual’s (i.e., actor, director, writer) salary level in the television market.

Current wording

Participation costs represent contingent consideration payable based on the performance of the film or television program to parties associated with the film or television program, including producers, writers, directors or actors. Residuals represent amounts payable to various unions or “guilds” such as the Screen Actors Guild - American Federation of Television and Radio Artists, Directors Guild of America, and Writers Guild of America, based on the performance of the film or television program in certain ancillary markets or based on the individual’s (i.e., actor, director, writer) salary level in the television market.

Previous wording

Distribution and marketing expenses primarily include the costs of theatrical prints and advertising (“P&A”) and premium video-on-demand (“Premium VOD”) expense and of DVD/Blu-ray duplication and marketing. Theatrical P&A includes the costs of the theatrical prints delivered to theatrical exhibitors and the advertising and marketing cost associated with the theatrical release of the picture. Premium VOD expense represents the advertising and marketing cost associated with the Premium VOD release of the picture.

Current wording

Distribution and marketing expenses primarily include the costs of theatrical prints and advertising (“P&A”) and premium video-on-demand (“Premium VOD”) expense and of DVD/Blu-ray duplication and marketing. Theatrical P&A includes the costs of the theatrical prints delivered to theatrical exhibitors and the advertising and marketing cost associated with the theatrical release of the picture. Premium VOD expense represents the advertising and marketing cost associated with the Premium VOD release of the picture. DVD/Blu-ray duplication represents the cost of the DVD/Blu-ray product and the manufacturing costs associated with creating the physical products. DVD/Blu-ray marketing costs represent the cost of advertising the product at or near the time of its release or special promotional advertising.

Previous wording

General and administration expenses include salaries and other overhead costs. Corporate general and administrative expenses include certain corporate executive expenses (such as salaries and wages for the office of the Chief Executive Officer, Chief Financial Officer, General Counsel and other corporate officers), investor relations costs, costs of maintaining corporate facilities, and other unallocated common administrative support functions, including corporate accounting, finance and financial reporting, internal and external audit and tax costs, corporate and other legal support functions, and certain information technology and human resources expense. Corporate general and administrative expenses also include costs that were previously incurred in support of the Media Networks segment but are not directly attributable to it and thus were not recorded in discontinued operations, see Note 2 to our unaudited condensed consolidated financial statements for further information.

Current wording

General and administration expenses include salaries and other overhead costs. Corporate general and administrative expenses include certain corporate executive expenses (such as salaries and wages for the office of the Chief Executive Officer, Chief Financial Officer, General Counsel and other corporate officers), investor relations costs, costs of maintaining corporate facilities, and other unallocated common administrative support functions, including corporate accounting, finance and financial reporting, internal and external audit and tax costs, corporate and other legal support functions, and certain information technology and human resources expense. Corporate general and administrative expenses also include overhead costs previously allocated to the Starz Business that were not included in discontinued operations because they were not directly attributable to the Media Networks segment. See Note 2 to the unaudited condensed consolidated financial statements for further information.

Previous wording

The preparation of our financial statements in conformity with accounting principles generally accepted in the U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The application of the following accounting policies, which are important to our financial position and results of operations, requires significant judgments and estimates on the part of management. As described more fully below, these estimates bear the risk of change due to the inherent uncertainty of the estimate. In some cases, changes in the accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could differ materially from our estimates. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations will be affected. We base our estimates on past experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. We believe that the following discussion addresses our most critical accounting policies, which are those that are most important to the portrayal of our financial condition and results of operations and require management's most difficult, subjective and complex judgments. For a summary of all of our accounting policies, including the accounting policies discussed below, see Note 1 to the audited consolidated financial statements and related notes included as Exhibit 99.1 to the Legacy Lionsgate Studios Annual Report on Form 10-K for the fiscal year ended March 31, 2025, filed with the Securities and Exchange Commission (the “SEC”) on May 30, 2025 (the “Form 10-K”).

Current wording

The preparation of our financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The application of the following accounting policies, which are important to our financial position and results of operations, requires significant judgments and estimates on the part of management. As described more fully below, these estimates bear the risk of change due to the inherent uncertainty of the estimate. In some cases, changes in the accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could differ materially from our estimates. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations will be affected. We base our estimates on past experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. We believe that the following discussion addresses our most critical accounting policies, which are those that are most important to the portrayal of our financial condition and results of operations and require management’s most difficult, subjective and complex judgments. For a summary of all of our accounting policies, including the accounting policies discussed below, see Note 1 to the audited consolidated financial statements and related notes in the Company’s Annual Report on Form 10-K for the year ended March 31, 2026, filed with the Securities and Exchange Commission (“SEC”) on May 27, 2026.

Previous wording

Amortization. Film cost amortization as well as participations and residuals expense are based on management’s estimates. Costs of acquiring and producing films and television programs and of acquired libraries that are amortized and estimated liabilities for participations and residuals costs are accrued using the individual-film-forecast method, based on the ratio of the current period's revenues to management’s estimated remaining total gross revenues to be earned (“ultimate revenue”). Management’s judgment is required in estimating ultimate revenue and the costs to be incurred throughout the life of each film or television program.

Current wording

Amortization. Film cost amortization as well as participations and residuals expense are based on management’s estimates. Costs of acquiring and producing films and television programs and of acquired libraries that are amortized and estimated liabilities for participations and residuals costs are accrued using the individual-film-forecast method, based on the ratio of the current period's revenues to management’s estimated remaining total gross revenues to be earned (“ultimate revenue”).

Previous wording

Impairment Assessment. An individual film or television program is evaluated for impairment when events or changes in circumstances indicate that the fair value of an individual film or television program is less than its unamortized cost. If the result of the impairment test indicates that the carrying value exceeds the estimated fair value, an impairment charge will then be recorded for the amount of the difference.

Current wording

Impairment Assessment. An individual film or television program is evaluated for impairment when events or changes in circumstances indicate that the fair value of an individual film or television program is less than its unamortized cost. Pre-release impairment assessments require significant judgment, including estimated box office performance and downstream licensing revenues. If the result of the impairment test indicates that the carrying value exceeds the estimated fair value, an impairment charge will then be recorded for the amount of the difference.

Previous wording

Valuation Assumptions. The discounted cash flow analysis includes cash flows estimates of ultimate revenue and costs as well as a discount rate (a Level 3 fair value measurement, see Note 9 to our unaudited condensed consolidated financial statements). The discount rate utilized in the discounted cash flow analysis is based on the weighted average cost of capital of the Company plus a risk premium representing the risk associated with producing a particular film or television program. Estimates of future revenue involve measurement uncertainty and it is therefore possible that reductions in the carrying value of investment in films and television programs may be required as a consequence of changes in management’s future revenue estimates.

Current wording

Valuation Assumptions. The discounted cash flow analysis includes cash flow estimates of ultimate revenue and costs as well as a discount rate (a Level 3 fair value measurement). The discount rate utilized in the discounted cash flow analysis is based on the weighted average cost of capital of the Company plus a risk premium representing the risk associated with producing a particular film or television program. Estimates of future revenue involve measurement uncertainty and it is therefore possible that reductions in the carrying value of investment in films and television programs may be required as a result of changes in management’s future revenue estimates.

Previous wording

Income Taxes. We are subject to federal and state income taxes in the U.S., and in several foreign jurisdictions. We record deferred tax assets related to net operating loss carryforwards and certain temporary differences, net of applicable reserves in these jurisdictions. We recognize a future tax benefit to the extent that realization of such benefit is more likely than not on a jurisdiction-by-jurisdiction basis; otherwise, a valuation allowance is applied. In order to realize the benefit of our deferred tax assets, we will need to generate sufficient taxable income in the future in each of the jurisdictions which have these deferred tax assets. However, the assessment as to whether there will be sufficient taxable income in a jurisdiction to realize our net deferred tax assets in that jurisdiction is an estimate which could change in the future depending primarily upon the actual performance of our Company. We will be required to continually evaluate the more likely than not assessment that our net deferred tax assets will be realized, and if operating results deteriorate in a particular jurisdiction, we may need to record a valuation allowance for all or a portion of our deferred tax assets through a charge to our income tax benefit (provision). As of December 31, 2025, we had a valuation allowance of $1,545.3 million against certain U.S. and foreign deferred tax assets that may not be realized on a more likely than not basis.

Current wording

Income Taxes. We are subject to income taxes in Canada and the United States, as well as in several other foreign jurisdictions. We record deferred tax assets related to net operating loss carryforwards and certain temporary differences, net of applicable reserves, in these jurisdictions. We recognize a future tax benefit to the extent that realization of such benefit is more-likely-than-not on a jurisdiction-by-jurisdiction basis; otherwise, a valuation allowance is applied. Realizing the benefit of our deferred tax assets requires the generation of sufficient future taxable income in each jurisdiction in which those deferred tax assets exist. Our assessment of whether taxable income in a jurisdiction will be sufficient to realize our deferred tax assets is an estimate that could change in the future, depending primarily on the actual operating performance of our Company. We continually evaluate our more-likely-than-not assessment and, if operating results deteriorate in a particular jurisdiction, we may need to record a valuation allowance against all or a portion of our deferred tax assets in that jurisdiction through a charge to our income tax provision. As of June 30, 2026, we had a valuation allowance of $1,489.5 million against certain Canadian, U.S. and other foreign deferred tax assets that may not be realized on a more-likely-than-not basis.

Previous wording

Our quarterly income tax provision and our corresponding annual effective tax rate are based on expected income, statutory tax rates and tax planning opportunities available in the various jurisdictions in which we operate. For interim financial reporting, we estimate the annual effective tax rate based on projected taxable income for the full year and record a quarterly tax provision in accordance with the expected annual effective tax rate. As the year progresses, we refine the estimates of the year’s taxable income as new information becomes available, including year-to-date financial results. This continual estimation process often results in a change to our expected annual effective tax rate for the year. When this occurs, we adjust our income tax provision during the quarter in which the change in estimate occurs so that the year-to-date income tax provision reflects the expected annual effective tax rate. Significant judgment is required in determining our expected annual effective tax rate and in evaluating our tax positions.

Current wording

Our quarterly income tax provision and corresponding annual effective tax rate are based on expected income (loss), statutory tax rates, and tax planning opportunities available in the various jurisdictions in which we operate. For interim financial reporting, we estimate the annual effective tax rate based on projected taxable income (loss) for the full year and record a quarterly income tax provision in accordance with that estimated annual effective tax rate. As the year progresses, we refine our estimates of the year's taxable income (loss) as new information becomes available, including year-to-date financial results. This continual estimation process may result in changes to our expected annual effective tax rate, in which case we adjust our income tax provision in the quarter in which the change in estimate occurs, so that the year-to-date income tax provision reflects the expected annual effective tax rate. Significant judgment is required in determining our expected annual effective tax rate and in evaluating our tax positions.

Previous wording

Our effective tax rates differ from the U.S. federal statutory income tax rate and is affected by many factors, including the overall level of income (loss) before taxes and its mix across the jurisdictions in which we conduct operations, changes in tax laws and regulations, changes in valuation allowances against our deferred tax assets, changes in unrecognized tax benefits, tax planning strategies available to us, and other discrete items.

Current wording

Our income tax provision differs from the amount that would result from applying the Canadian federal statutory income tax rate to income (loss) before income taxes. This difference is affected by many factors, including the overall level of income (loss) before income taxes and its mix across the jurisdictions in which we operate, the effect of valuation allowances against our deferred tax assets in jurisdictions where we do not recognize a tax benefit on losses, changes in tax laws and regulations, changes in unrecognized tax benefits, tax planning strategies available to us, and other discrete items.

Previous wording

Motion Picture revenue increased $109.8 million, primarily due to an increase in theatrical, international and digital home entertainment revenue.

Current wording

Motion Picture revenue increased $320.0 million, primarily due to an increase in theatrical, international and digital home entertainment revenue.

Previous wording

Television Production revenue decreased $272.2 million due to a decrease in domestic television and other revenue, offset by an increase in home entertainment and international revenue.

Current wording

Television Production revenue decreased $99.2 million, primarily due to a decrease in domestic television, digital home entertainment and international revenue.

Previous wording

Revenues. Consolidated revenues increased $96.1 million in the three months ended December 31, 2025 reflecting an increase of $109.8 million from Motion Picture revenue and no intersegment eliminations recorded in the current quarter compared to the prior year quarter of $87.8 million, offset by a decrease of $101.5 million from Television Production. Intersegment eliminations relate to the licensing of products from our Studio Business to the former Media Networks segment prior to the Starz Separation. Following the Starz Separation, revenue from licenses to Starz were not eliminated from our consolidated results from continuing operations. See further discussion in the Segment Results of Operations section below.

Current wording

Intersegment eliminations in the three months ended June 30, 2025, relate to the licensing of products from our Studio Business to the former Media Networks segment prior to the Starz Separation. Following the Starz Separation, revenue from licenses to Starz were not eliminated from our consolidated results from continuing operations.

Previous wording

Total direct operating expenses increased in the three months ended December 31, 2025. The increase was primarily due to increased revenue from the Motion Picture segment, partially offset by a decrease in revenue from the Television Production segment. The decrease in intersegment eliminations is due to there being no Motion Picture and Television Production intersegment revenue from licenses of motion pictures and original series to the former Media Networks segment following the Starz Separation, as discussed above. See further discussion in the Segment Results of Operations section below.

Current wording

Total direct operating expenses increased in the three months ended June 30, 2026. The increase was primarily due to increased revenue from the Motion Picture segment, partially offset by a decrease in revenue from the Television Production segment.

Previous wording

Other. Other direct operating expenses in the three months ended December 31, 2025 and December 31, 2024 primarily consist of rent costs for production facilities that were unutilized due to lower demand following the industry strikes amounting to $7.9 million and $4.1 million, respectively. The costs are included in direct operating expense and are not allocated to the segments.

Current wording

Other. Other direct operating expenses in the three months ended June 30, 2026 and 2025 consist of rent costs for production facilities that were unutilized due to lower demand following the industry strikes amounting to $5.1 million and $5.4 million, respectively. The costs are included in direct operating expense and are not allocated to the segments.

Previous wording

Segment Results of Operations and Non-GAAP Measures

Current wording

Distribution and marketing expenses increased in the three months ended June 30, 2026, primarily due to higher theatrical distribution and marketing expenses in the Motion Picture segment. See further discussion in the Segment Results of Operations section below.

Previous wording

General and administrative expenses increased in the three months ended December 31, 2025, primarily as a result of increased share-based compensation expense, offset by a decrease in Corporate general and administrative expenses. See further discussion in the Segment Results of Operations section below.

Current wording

General and administrative expenses increased in the three months ended June 30, 2026, primarily as a result of increased share-based compensation expenses and increased Studio Business and Corporate general and administrative expenses. See further discussion in the Segment Results of Operations section below.

Previous wording

The increase in share-based compensation expense included in general and administrative expense in the three months ended December 31, 2025, as compared to the three months ended December 31, 2024 was primarily due to share-based bonuses granted in the current fiscal period, with no similar grants in the prior fiscal period, and higher fair values in the current fiscal period associated with performance-based stock option and other equity awards that are revalued at each reporting period until the stock option or equity award vests and the applicable performance goals are achieved.

Current wording

The increase in share-based compensation expense included in general and administrative expenses in the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, was primarily due to higher fair values in the current fiscal period associated with performance-based stock option and other equity awards that are revalued at each reporting period until the stock option or equity award vests and the applicable performance goals are achieved. The increase in fair value was primarily attributed to increases in the Company’s stock price.

Previous wording

The increase in share-based compensation expense included in general and administrative expense in the nine months ended December 31, 2025, as compared to the nine months ended December 31, 2024, was primarily due to share-based bonuses granted in the current year period, with no similar grants in the prior year period. The following table presents share-based compensation expense by financial statement line item:

Current wording

The following table presents share-based compensation expense by financial statement line item:

Previous wording

Restructuring and Other. Restructuring and other decreased $23.2 million in the three months ended December 31, 2025 as compared to the three months ended December 31, 2024. See Note 15 to our unaudited condensed consolidated financial statements. Restructuring and other includes restructuring and severance costs and certain transaction and other costs, when applicable and were as follows for the three months ended December 31, 2025 and 2024:

Current wording

Restructuring and Other. Restructuring and other decreased $1.9 million in the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. See Note 14 to our unaudited condensed consolidated financial statements. Restructuring and other includes severance and certain transaction and other costs, when applicable, and were as follows for the three months ended June 30, 2026 and 2025:

Previous wording

(2) Severance costs were primarily related to workforce reduction actions undertaken in connection with restructuring and acquisition integration activities, as well as other cost-reduction initiatives.

Current wording

(1) Severance costs were primarily related to workforce reduction actions undertaken in connection with restructuring and acquisition integration activities, as well as other cost-reduction initiatives and are not reflective of our ongoing operating structure.

Previous wording

(3)Transaction and other costs primarily relate to transaction, integration and legal costs incurred in connection with certain strategic transactions and restructuring activities, as well as costs associated with certain legal matters. For the nine months ended December 31, 2025, transaction costs associated with the Starz Separation are excluded, as such amounts are classified within discontinued operations. The nine months ended December 31, 2025 include a gain of $2.6 million from the sale of our streaming platform in India.

Current wording

(2) Transaction and other costs primarily relate to transaction, integration and legal costs incurred in connection with certain strategic transactions and restructuring activities, as well as costs associated with certain legal matters. For the three months ended June 30, 2025, amounts exclude transaction costs associated with the Starz Separation as such amounts are classified within discontinued operations.

Previous wording

Interest Expense. Interest expense of $65.0 million in the three months ended December 31, 2025 increased $1.3 million from the three months ended December 31, 2024.

Current wording

Interest Expense. Interest expense of $56.9 million in the three months ended June 30, 2026 decreased $11.8 million from the three months ended June 30, 2025 primarily due to lower average interest rates on variable rate corporate debt and film related obligations.

Previous wording

(2)Other interest expense includes payments associated with certain film related obligations (Production loans, Production Tax Credit Facility, Film Library Facility, Backlog Facility and other - see Note 8 to our unaudited condensed consolidated financial statements), interest expense associated with our 3 Arts Entertainment Credit Facility, payments and receipts associated with interest rate swaps along with the noncash amortization of unrealized gains in accumulated other comprehensive income related to dedesignated interest rate swaps which are being amortized to interest expense (see Note 18 to our unaudited condensed consolidated financial statements), and noncash amortization of debt issuance costs.

Current wording

(2)Other interest expense includes payments associated with certain film related obligations (Production loans, Production Tax Credit Facility and Backlog Facility and other, see Note 7 to our unaudited condensed consolidated financial statements), interest expense associated with our 3 Arts Entertainment Credit Facility, payments and receipts associated with interest rate swaps along with the noncash amortization of unrealized gains in accumulated other comprehensive income related to dedesignated interest rate swaps which are being amortized to interest expense (see Note 17 to our unaudited condensed consolidated financial statements), and noncash amortization of debt issuance costs.

Previous wording

Interest and Other Income. Interest and other income of $4.0 million in the three months ended December 31, 2025 increased, as compared to interest and other income of $3.1 million in the three months ended December 31, 2024.

Current wording

Interest and Other Income. Interest and other income of $4.8 million in the three months ended June 30, 2026 increased, as compared to interest and other income of $4.4 million in the three months ended June 30, 2025.

Previous wording

Other Income (Loss), net. Other gain (losses) was net loss of $7.6 million in the three months ended December 31, 2025, compared to a net gain of $10.2 million in the three months ended December 31, 2024. The change was due to losses incurred related to foreign currency transactions during the three months ended December 31, 2025 as compared to income related to foreign currency transactions during the three months ended December 31, 2024

Current wording

Other Gain (Loss), net. The change in other gain, net of $3.7 million for the three months ended June 30, 2026 compared to other loss, net of $17.0 million for the three months ended June 30, 2025, was primarily due to income related to foreign currency transactions during the three months ended June 30, 2026, as compared to losses incurred related to foreign currency transactions during the three months ended June 30, 2025.