| SEGMENT REPORTING |
NOTE 11—SEGMENT REPORTING The Company reports information about operating segments in accordance with ASC 280-10, Segment Reporting, which requires financial information to be reported based on the way management organizes segments within a company for making operating decisions and evaluating performance. Management has organized the Company around differences in geographic areas. The Company has identified two reportable segments and reporting units for its theatrical exhibition operations, U.S. markets and International markets. The International markets reportable segment has operations in or partial interest in theatres in the United Kingdom, Germany, Spain, Italy, Ireland, Portugal, Sweden, Finland, Norway, and Denmark. Each segment’s revenue is derived from admissions, food and beverage sales and other ancillary revenues, primarily screen advertising, loyalty membership fees, ticket sales, gift card income and exchange ticket income. The measure of segment profit and loss the Company’s chief operating decision maker (“CODM”) uses to evaluate performance and allocate its resources is Adjusted EBITDA, as defined in the reconciliation table below. During the year ended December 31, 2024, the Company changed the definition of Adjusted EBITDA to no longer further adjust for “cash distributions from non-consolidated entities” and “other non-cash rent benefit.” All comparative period information for Adjusted EBITDA has been re-cast to conform with the current definition. The Company’s CODM is the chief executive officer. The Company does not report asset information by segment because that information is not used to evaluate the performance of or allocate resources between segments. The CODM assess segment performance quarterly by comparing segment annual Adjusted EBITDA against budgeted and/or forecasted Adjusted EBITDA. The CODM uses Adjusted EBITDA for each segment to determine how to allocate resources for future capital expenditures and for general corporate purposes. The Company defines Adjusted EBITDA as net earnings (loss) plus (i) income tax provision (benefit), (ii) interest expense and (iii) depreciation and amortization, as further adjusted to eliminate the impact of certain items that the Company does not consider indicative of the Company’s ongoing operating performance and to include attributable EBITDA from equity investments in theatre operations in International markets. The following tables below provide reconciliation of segment revenues to Adjusted EBITDA: | | | | | | | | | | | | Year Ended | | | December 31, 2025 | (In millions) | | U.S. Markets | | International Markets | | Consolidated | Revenues (1) | | $ | 3,706.1 | | $ | 1,142.8 | | $ | 4,848.9 | Less: | | | | | | | | | | Film exhibition costs | | | 1,020.5 | | | 254.7 | | | 1,275.2 | Food and beverage costs | | | 241.2 | | | 85.8 | | | 327.0 | Operating expense, excluding depreciation and amortization (2) | | | 1,318.9 | | | 452.5 | | | 1,771.4 | Rent | | | 650.1 | | | 237.2 | | | 887.3 | General and administrative expense - other, excluding depreciation and amortization (3) | | | 128.3 | | | 85.1 | | | 213.4 | Other segment items (4) | | | 1.1 | | | (14.0) | | | (12.9) | Adjusted EBITDA | | $ | 346.0 | | $ | 41.5 | | $ | 387.5 |
| | | | | | | | | | | | Year Ended | | | December 31, 2024 | (In millions) | | U.S. Markets | | International Markets | | Consolidated | Revenues (1) | | $ | 3,544.2 | | $ | 1,093.0 | | $ | 4,637.2 | Less: | | | | | | | | | | Film exhibition costs | | | 988.8 | | | 250.4 | | | 1,239.2 | Food and beverage costs | | | 225.7 | | | 79.9 | | | 305.6 | Operating expense, excluding depreciation and amortization (2) | | | 1,249.0 | | | 425.0 | | | 1,674.0 | Rent | | | 649.9 | | | 223.7 | | | 873.6 | General and administrative expense - other, excluding depreciation and amortization (3) | | | 130.6 | | | 74.2 | | | 204.8 | Other segment items (4) | | | (1.3) | | | (2.6) | | | (3.9) | Adjusted EBITDA | | $ | 301.5 | | $ | 42.4 | | $ | 343.9 |
| | | | | | | | | | | | Year Ended | | | December 31, 2023 | (In millions) | | U.S. Markets | | International Markets | | Consolidated | Revenues | | $ | 3,688.7 | | $ | 1,123.9 | | $ | 4,812.6 | Less: | | | | | | | | | | Film exhibition costs | | | 1,023.3 | | | 267.8 | | | 1,291.1 | Food and beverage costs | | | 233.9 | | | 81.4 | | | 315.3 | Operating expense, excluding depreciation and amortization (2) | | | 1,261.8 | | | 427.2 | | | 1,689.0 | Rent | | | 651.5 | | | 222.0 | | | 873.5 | General and administrative expense - other, excluding depreciation and amortization (3) | | | 130.9 | | | 68.5 | | | 199.4 | Other segment items (4) | | | (3.8) | | | (6.2) | | | (10.0) | Adjusted EBITDA | | $ | 391.1 | | $ | 63.2 | | $ | 454.3 |
| (1) | All segment revenues are comprised of revenues from external customers. |
| (2) | Operating expense, excluding depreciation and amortization excludes certain operating expenses as further defined in the reconciliation of net loss to Adjusted EBITDA below. |
| (3) | General and administrative expense – other, excluding depreciation and amortization excludes stock compensation expense. |
| (4) | Other segment items include government assistance, business interruption insurance recoveries, net periodic pension cost (benefit), and attributable EBITDA from international theatre joint ventures. |
Other segment disclosures: | | | | | | | | | | | | Year Ended | | | December 31, 2025 | (In millions) | | U.S. Markets | | International Markets | | Consolidated | Depreciation and amortization | | $ | 239.1 | | $ | 74.3 | | $ | 313.4 | Income tax provision | | | 2.7 | | | 1.8 | | | 4.5 | Other expense (income) | | | 159.2 | | | (40.0) | | | 119.2 | Other significant noncash items: | | | | | | | | | | Stock-based compensation expense | | | 15.8 | | | 1.1 | | | 16.9 | Impairment of long-lived assets | | | 28.0 | | | 15.5 | | | 43.5 | Equity in earnings of non-consolidated entities | | | (5.7) | | | (1.1) | | | (6.8) | Capital expenditures | | | 174.2 | | | 71.9 | | | 246.1 |
| | | | | | | | | | | | Year Ended | | | December 31, 2024 | (In millions) | | U.S. Markets | | International Markets | | Consolidated | Depreciation and amortization | | $ | 247.5 | | $ | 72.0 | | $ | 319.5 | Income tax provision | | | — | | | 2.1 | | | 2.1 | Other income | | | (113.7) | | | (30.1) | | | (143.8) | Other significant noncash items: | | | | | | | | | | Stock-based compensation expense | | | 20.0 | | | 2.0 | | | 22.0 | Impairment of long-lived assets | | | 51.9 | | | 20.4 | | | 72.3 | Equity in earnings of non-consolidated entities | | | (10.7) | | | (1.7) | | | (12.4) | Capital expenditures | | | 171.4 | | | 74.1 | | | 245.5 |
| | | | | | | | | | | | Year Ended | | | December 31, 2023 | (In millions) | | U.S. Markets | | International Markets | | Consolidated | Depreciation and amortization | | $ | 286.5 | | $ | 78.5 | | $ | 365.0 | Income tax provision | | | 1.8 | | | 1.6 | | | 3.4 | Other income | | | (47.3) | | | (21.8) | | | (69.1) | Other significant noncash items: | | | | | | | | | | Stock-based compensation expense | | | 38.3 | | | 4.2 | | | 42.5 | Impairment of long-lived assets | | | 49.2 | | | 57.7 | | | 106.9 | Equity in earnings of non-consolidated entities | | | (5.5) | | | (2.2) | | | (7.7) | Capital expenditures | | | 167.0 | | | 58.6 | | | 225.6 |
The following table sets forth a reconciliation of net loss to Adjusted EBITDA: | | | | | | | | | | | | Year Ended | (In millions) | | December 31, 2025 | | December 31, 2024 | | December 31, 2023 | Net loss | | $ | (632.4) | | $ | (352.6) | | $ | (396.6) | Plus: | | | | | | | | | | Income tax provision (1) | | | 4.5 | | | 2.1 | | | 3.4 | Interest expense | | | 530.2 | | | 443.7 | | | 411.2 | Depreciation and amortization | | | 313.4 | | | 319.5 | | | 365.0 | Impairment of long-lived assets (2) | | | 43.5 | | | 72.3 | | | 106.9 | Certain operating expense (3) | | | 14.6 | | | 5.4 | | | 2.5 | Equity in earnings of non-consolidated entities (4) | | | (6.8) | | | (12.4) | | | (7.7) | Attributable EBITDA (5) | | | 2.3 | | | 1.9 | | | 2.2 | Investment income (6) | | | (32.1) | | | (16.3) | | | (15.5) | Other expense (income) (7) | | | 129.8 | | | (141.8) | | | (61.3) | Merger, acquisition and other costs (8) | | | 3.6 | | | 0.1 | | | 1.7 | Stock-based compensation expense (9) | | | 16.9 | | | 22.0 | | | 42.5 | Adjusted EBITDA | | $ | 387.5 | | $ | 343.9 | | $ | 454.3 |
| (1) | For information regarding the income tax provision (benefit), see Note 9—Income Taxes. |
| (2) | During the year ended December 31, 2025, the Company recorded non-cash impairment charges related to its long-lived assets of $28.0 million on 47 theatres in the U.S. markets with 560 screens which were related to property, net and operating lease right-of-use assets, net and $15.5 million on 20 theatres in the International markets with 159 screens which were related to property, net and operating lease right-of-use assets, net. |
During the year ended December 31, 2024, the Company recorded non-cash impairment charges related to its long-lived assets of $51.9 million on 39 theatres in the U.S. markets with 469 screens which were related to property, net and operating lease right-of-use assets, net and $20.4 million on 23 theatres in the International markets with 188 screens which were related to property, net and operating lease right-of-use assets, net. During the year ended December 31, 2023, the Company recorded non-cash impairment charges related to its long-lived assets of $49.2 million on 68 theatres in the U.S. markets with 738 screens which were related to property, net and operating lease right-of-use assets, net and $57.7 million on 57 theatres in the International markets with 488 screens which were related to property, net and operating lease right-of-use assets, net. | (3) | Amounts represent preopening expense related to temporarily closed screens under renovation, theatre and other closure expense for the permanent closure of screens, disposition of assets, and other non-operating gains or losses included in operating expenses. The Company has excluded these items as they are non-cash in nature or are non-operating in nature. |
| (4) | Equity in earnings of non-consolidated entities during the year ended December 31, 2025, primarily consisted of equity in earnings from AC JV of $(4.8) million. Equity in earnings of non-consolidated entities during the year ended December 31, 2024, primarily consisted of equity in earnings from AC JV of $(10.0) million. Equity in earnings of non-consolidated entities during the year ended December 31, 2023, primarily consisted of equity in earnings from AC JV of $(4.9) million. |
| (5) | Attributable EBITDA includes the EBITDA from equity investments in theatre operators in certain International markets. See below for a reconciliation of the Company’s equity in (earnings) of non-consolidated entities to attributable EBITDA. Because these equity investments are in theatre operators in regions where the Company holds a significant market share, the Company believes attributable EBITDA is more indicative of the performance of these equity investments and management uses this measure to monitor and evaluate these equity investments. |
| | | | | | | | | | | | Year Ended | (In millions) | | December 31, 2025 | | December 31, 2024 | | December 31, 2023 | Equity in (earnings) of non-consolidated entities | | $ | (6.8) | | $ | (12.4) | | $ | (7.7) | Less: | | | | | | | | | | Equity in (earnings) of non-consolidated entities excluding International theatre joint ventures | | | (5.7) | | | (11.5) | | | (6.6) | Equity in earnings of International theatre joint ventures | | | 1.1 | | | 0.9 | | | 1.1 | Income tax provision | | | 0.1 | | | — | | | 0.1 | Investment income | | | (0.5) | | | (0.4) | | | (0.6) | Interest expense | | | 0.2 | | | 0.1 | | | 0.2 | Depreciation and amortization | | | 1.4 | | | 1.3 | | | 1.4 | Attributable EBITDA | | $ | 2.3 | | $ | 1.9 | | $ | 2.2 |
| (6) | Investment income during the year ended December 31, 2025 includes interest income of $(8.0) million and realized and unrealized gains on the Company’s investments in Hycroft of $(34.4) million, partially offset by an impairment of an equity security without a readily determinable fair value of $10.3 million. |
Investment income during the year ended December 31, 2024 includes interest income of $(19.2) million, partially offset by unrealized losses on the Company’s investments in Hycroft of $2.9 million. Investment income during the year ended December 31, 2023 included a $(15.5) million gain on sale of the Company’s investment in Saudi Cinema Company LLC and interest income of $(15.4) million, partially offset by unrealized losses on the Company’s investments in Hycroft of $12.6 million, $1.8 million of expense for NCM common units, and a $1.0 million impairment of an equity security without a readily determinable fair value. | (7) | Other expense during the year ended December 31, 2025 includes net losses on debt extinguishment of $196.0 million, an increase in the fair value of the bifurcated embedded derivative in the New Exchangeable Notes of $19.3 million, and term loan modification third party fees of $3.1 million, partially offset by a decrease in the fair value of the bifurcated embedded derivative in the Existing Exchangeable Notes of $(56.7) million, foreign currency transaction gains of $(28.1) million, and shareholder litigation recoveries of $(3.8) million. |
Other income for the year ended December 31, 2024 includes a decrease in the fair value of the bifurcated embedded derivative in the Existing Exchangeable Notes of $(75.8) million, shareholder litigation recoveries of $(40.2) million, net gains on debt extinguishment of $(38.9) million, and a vendor dispute of $(36.2) million, partially offset by term loan modification third party fees of $42.3 million and foreign currency transaction losses of $7.0 million. Other income for the year ended December 31, 2023 includes gains on debt extinguishment of $(142.8) million and foreign currency transaction gains of $(17.8) million, partially offset by a non-cash litigation charge of $99.3 million. | (8) | Merger, acquisition and other costs are excluded as they are non-operating in nature. |
| (9) | Non-cash expense included in general and administrative: other. |
Financial information about geographic area is as follows: | | | | | | | | | | | | Year Ended | Revenues (In millions) | | December 31, 2025 | | December 31, 2024 | | December 31, 2023 | United States | | $ | 3,706.1 | | $ | 3,544.2 | | $ | 3,688.7 | United Kingdom | | | 428.5 | | | 408.8 | | | 400.9 | Spain | | | 153.4 | | | 143.3 | | | 148.2 | Sweden | | | 122.5 | | | 116.4 | | | 124.9 | Italy | | | 147.3 | | | 147.6 | | | 151.9 | Germany | | | 124.3 | | | 111.6 | | | 125.8 | Finland | | | 84.7 | | | 90.1 | | | 97.9 | Ireland | | | 33.1 | | | 32.5 | | | 32.2 | Other foreign countries | | | 49.0 | | | 42.7 | | | 42.1 | Total revenues | | $ | 4,848.9 | | $ | 4,637.2 | | $ | 4,812.6 |
| | | | | | | | | As of | | As of | Long-term assets, net (In millions) | | December 31, 2025 | | December 31, 2024 | United States | | $ | 5,267.4 | | $ | 5,474.2 | International | | | 2,019.9 | | | 1,826.1 | Total long-term assets (1) | | $ | 7,287.3 | | $ | 7,300.3 |
| (1) | Long-term assets are comprised of property, operating lease right-of-use assets, intangible assets, goodwill, deferred tax assets, net and other long-term assets. |
|