MIAMI, FLORIDA / ACCESS Newswire / October 8, 2025 / Last night in New York City, Dolphin (NASDAQ:DLPN) celebrated the recognition of its Founder and CEO, Bill O'Dowd, who was named to the PRNEWS 2025 People of the Year list, honoring the industry's most innovative and influential leaders. At the same time, Dolphin was recognized on the PRNEWS Agency Elite 120 , a prestigious ranking of the top communications, PR, and marketing firms shaping the future of the industry. ...

New Scenes Will be Shot at The LA Kings Crypto.com Arena The Adaptation of the Iconic Classic Hockey Movie Had Its World Premiere at the 2025 Toronto International Film Festival LOS ANGELES, CALIFORNIA / ACCESS Newswire / September 30, 2025 / Dolphin (NASDAQ:DLPN), a leading entertainment marketing and premium content production company, and Anschutz Entertainment Group (AEG), the global live entertainment and sports conglomerate, announced today a historic collaboration that will see the Los Angeles Kings ...

NEW YORK, NY / ACCESS Newswire / September 18, 2025 / Dolphin (NASDAQ:DLPN) subsidiary The Digital Dept. brought together more than 150 of today's most influential fashion, beauty, wellness, and lifestyle creators for The BRANDEdit Fashion Week Experience: A Glimpse Into the Future, held September 11-12 during New York Fashion Week. ...

LOS ANGELES, CALIFORNIA / ACCESS Newswire / September 16, 2025 / The entertainment PR and marketing powerhouse 42West, a subsidiary of Dolphin (NASDAQ:DLPN), congratulates its clients on their wins at the 77th Primetime Emmy Awards, collaborating for a total of five wins. Katherine LaNasa took home Outstanding Supporting Actress in a Drama Series for her performance as Dana Evans in HBO Max's The Pitt, which also won the top prize of the night in the Drama field. ...

[PART I — FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) This section provides the unaudited condensed consolidated financial information for Dolphin Entertainment, Inc., covering financial statements, management's discussion, and controls [ITEM 1. FINANCIAL STATEMENTS](index=4&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) This section presents the unaudited condensed consolidated financial statements for Dolphin Entertainment, Inc. and its subsidiaries, including balance sheets, statements of operations, cash flows, and changes in stockholders' equity, along with detailed notes explaining accounting policies, revenue recognition, debt, equity, and other financial commitments [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The condensed consolidated balance sheets show a slight increase in total assets and liabilities from December 31, 2024, to June 30, 2025, while total stockholders' equity decreased significantly Condensed Consolidated Balance Sheet Summary | Metric | June 30, 2025 ($) | December 31, 2024 ($) | | :--------------------------- | :-------------- | :------------------ | | Total Assets | 58,611,434 | 58,437,279 | | Total Liabilities | 50,709,023 | 46,791,888 | | Total Stockholders' Equity | 7,902,411 | 11,645,391 | - Current assets increased from **$20,067,099** to **$22,156,949**, primarily driven by increases in accounts receivable (trade and other) and deferred revenue[8](index=8&type=chunk)[11](index=11&type=chunk) - Current liabilities increased from **$26,514,137** to **$29,131,730**, mainly due to increases in accounts payable and deferred revenue, and the introduction of a current portion of convertible note payable[11](index=11&type=chunk) [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company reported a net loss for both the three and six months ended June 30, 2025, with a significant increase in net loss for the six-month period compared to the prior year, primarily due to a loss on extinguishment of debt Condensed Consolidated Statements of Operations Summary | Metric | Three Months Ended June 30, 2025 ($) | Three Months Ended June 30, 2024 ($) | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenues | 14,087,529 | 11,449,089 | 26,257,240 | 26,684,981 | | Total expenses | 14,144,583 | 12,568,554 | 28,087,820 | 27,639,907 | | Loss from operations | (57,054) | (1,119,465) | (1,830,580) | (954,926) | | Total other (expenses) income, net | (1,335,341) | (481,453) | (1,869,355) | (949,221) | | Net loss | (1,413,918) | (1,624,458) | (3,742,980) | (1,951,226) | | Basic Loss per share | (0.13) | (0.17) | (0.33) | (0.20) | | Diluted Loss per share | (0.13) | (0.17) | (0.34) | (0.20) | - Revenues increased by **$2.6 million** for the three months ended June 30, 2025, but decreased by **$0.4 million** for the six months ended June 30, 2025, compared to the prior year periods[13](index=13&type=chunk) - A significant loss on extinguishment of debt of **$835,324** was recorded for both the three and six months ended June 30, 2025, contributing to the increased net loss[13](index=13&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash flows from operating activities shifted from a net inflow in 2024 to a net outflow in 2025, while financing activities provided less cash in 2025 compared to 2024, leading to a smaller net increase in cash and cash equivalents Condensed Consolidated Statements of Cash Flows Summary | Cash Flow Activity | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :----------------------------------- | :----------------------------- | :----------------------------- | | Net cash (used in) provided by operating activities | (197,522) | 661,239 | | Net cash used in investing activities | (1,088) | (1,136,510) | | Net cash provided by financing activities | 692,128 | 2,761,515 | | Net increase in cash and cash equivalents and restricted cash | 493,518 | 2,286,244 | - Operating activities used **$197,522** cash in H1 2025, a significant change from providing **$661,239** in H1 2024, primarily due to an increased net loss and changes in working capital[16](index=16&type=chunk)[169](index=169&type=chunk) - Financing activities provided **$692,128** in H1 2025, down from **$2,761,515** in H1 2024, mainly due to lower proceeds from related party loans and equity line of credit, despite new convertible and nonconvertible notes[16](index=16&type=chunk)[171](index=171&type=chunk)[178](index=178&type=chunk) [Consolidated Statements of Changes in Stockholders' Equity](index=9&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) Stockholders' equity decreased from $11,645,391 at December 31, 2024, to $7,902,411 at June 30, 2025, primarily due to net losses incurred during the period Consolidated Statements of Changes in Stockholders' Equity Summary | Metric | December 31, 2024 ($) | June 30, 2025 ($) | | :--------------------------- | :---------------- | :-------------- | | Total Stockholders' Equity | 11,645,391 | 7,902,411 | | Net loss for Q1 2025 | N/A | (2,329,062) | | Net loss for Q2 2025 | N/A | (1,413,918) | - The accumulated deficit increased from **$(146,214,429)** at December 31, 2024, to **$(149,957,409)** at June 30, 2025, reflecting the net losses[21](index=21&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed disclosures on the company's accounting policies, revenue recognition, goodwill and intangible assets, debt instruments, related party transactions, segment performance, leases, and recent accounting pronouncements, offering crucial context to the condensed financial statements [NOTE 1 – GENERAL](index=10&type=section&id=NOTE%201%20%E2%80%93%20GENERAL) Dolphin Entertainment, Inc. is a leading independent entertainment marketing and production company, operating through various subsidiaries providing strategic marketing, publicity, and content production services. The financial statements are prepared in accordance with U.S. GAAP for interim reporting, and management's estimates are crucial for fair value and impairment assessments - The Company operates through subsidiaries like 42West, The Door, Shore Fire, The Digital Dept., Special Projects, Always Alpha, and Elle, offering services in motion picture, television, music, gaming, culinary, hospitality, and lifestyle industries[23](index=23&type=chunk)[24](index=24&type=chunk) - New accounting standard ASU 2023-09 (Income Taxes) will require additional disclosures for income tax rate reconciliation and disaggregation of taxes paid, effective for fiscal year ending **December 31, 2025**[28](index=28&type=chunk) - ASU 2024-03 (Disaggregation of Income Statement Expenses) will require disaggregated disclosure of specific expense categories, effective for annual periods beginning after **December 15, 2026**[29](index=29&type=chunk) [NOTE 2 – REVENUE](index=11&type=section&id=NOTE%202%20%E2%80%93%20REVENUE) Revenue is primarily generated from the Entertainment Publicity and Marketing (EPM) segment, which saw significant growth, while the Content Production (CPD) segment experienced a decrease due to the prior year's Blue Angels film revenue Revenue by Segment | Segment | Three Months Ended June 30, 2025 ($) | Three Months Ended June 30, 2024 ($) | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Entertainment publicity and marketing | 14,087,529 | 11,449,089 | 26,165,207 | 23,263,840 | | Content production | — | — | 92,033 | 3,421,141 | | Total Revenues | 14,087,529 | 11,449,089 | 26,257,240 | 26,684,981 | - EPM segment revenue increased by **$2.6 million (22.9%)** for the three months and **$2.9 million (12.5%)** for the six months ended June 30, 2025, driven by acquisitions (Elle) and organic growth (The Digital Dept., Special Projects, The Door)[35](index=35&type=chunk)[149](index=149&type=chunk) - CPD segment revenue decreased by **$3.3 million** for the six months ended June 30, 2025, primarily due to the prior year's revenue from The Blue Angels documentary film[35](index=35&type=chunk)[150](index=150&type=chunk) [NOTE 3 – GOODWILL AND INTANGIBLE ASSETS](index=12&type=section&id=NOTE%203%20%E2%80%93%20GOODWILL%20AND%20INTANGIBLE%20ASSETS) The company's goodwill remained stable at $21.5 million, all related to the EPM segment, with no impairment triggers identified in H1 2025. Finite-lived intangible assets, primarily customer relationships and trademarks, decreased due to amortization - Goodwill balance was **$21,507,944** as of June 30, 2025, unchanged from December 31, 2024, and is entirely allocated to the EPM segment[39](index=39&type=chunk) - No goodwill impairment was recorded for the six months ended June 30, 2025, compared to **$190,565** impairment in H1 2024 related to the closure of Viewpoint subsidiary[40](index=40&type=chunk)[155](index=155&type=chunk) Intangible Assets Net Carrying Amount | Intangible Asset Category | June 30, 2025 (Net Carrying Amount) ($) | December 31, 2024 (Net Carrying Amount) ($) | | :------------------------ | :---------------------------------- | :-------------------------------------- | | Customer relationships | 7,472,293 | 8,355,778 | | Trademarks and trade names | 1,568,248 | 1,833,248 | | Total Intangible Assets | 9,040,541 | 10,189,026 | [NOTE 4 – OTHER CURRENT LIABILITIES](index=13&type=section&id=NOTE%204%20%E2%80%93%20OTHER%20CURRENT%20LIABILITIES) Other current liabilities increased to $12.0 million at June 30, 2025, from $11.1 million at December 31, 2024, driven by higher accumulated customer deposits and other liabilities, partially offset by decreases in accrued commissions and professional fees Other Current Liabilities Summary | Category | June 30, 2025 ($) | December 31, 2024 ($) | | :--------------------------------------- | :-------------- | :------------------ | | Accrued funding under Max Steel production agreement | 620,000 | 620,000 | | Accrued audit, legal and other professional fees | 154,501 | 369,347 | | Accrued commissions | 836,361 | 1,285,751 | | Accrued bonuses | 1,084,380 | 1,207,829 | | Talent liability | 5,778,347 | 5,595,816 | | Accumulated customer deposits | 2,187,174 | 937,766 | | Other | 1,387,285 | 1,087,527 | | Total Other current liabilities | 12,048,048 | 11,104,036 | - An additional **$416,171** acquisition cost related to the Special Projects working capital adjustment was recorded in H1 2025, with a balance of **$277,447** remaining in other current liabilities[44](index=44&type=chunk) [NOTE 5 – DEBT](index=14&type=section&id=NOTE%205%20%E2%80%93%20DEBT) Total debt increased to $24.4 million at June 30, 2025, from $22.4 million at December 31, 2024, driven by new convertible and non-convertible notes, including a significant convertible note from a related party, partially offset by term loan repayments Debt Summary | Debt Type | June 30, 2025 ($) | December 31, 2024 ($) | | :------------------------------------ | :-------------- | :------------------ | | Convertible notes payable | 7,000,000 | 5,100,000 | | Convertible note payable - fair value option | 250,000 | 320,000 | | Non-convertible promissory notes | 4,430,000 | 3,880,000 | | Non-convertible promissory notes – Socialyte | 3,000,000 | 3,000,000 | | Convertible note payable – related party | 3,078,197 | — | | Loans from related party | 983,112 | 3,225,985 | | Revolving line of credit | — | 400,000 | | First BKU Term loan | 4,033,725 | 4,565,048 | | Second BKU Term loan | 1,695,946 | 2,000,000 | | Total debt | 24,382,633 | 22,394,274 | - The company issued fourteen new convertible notes payable totaling **$1.9 million** in H1 2025, with conversion prices tied to market prices or fixed rates, and maturity dates ranging from **2026 to 2030**[46](index=46&type=chunk)[47](index=47&type=chunk) - Interest expense for debt increased by **$0.04 million** (three months) and **$0.1 million** (six months) YoY, primarily due to new convertible and nonconvertible notes and the Second BKU Term Loan[162](index=162&type=chunk) [NOTE 6 – LOANS FROM RELATED PARTY](index=18&type=section&id=NOTE%206%20%E2%80%93%20LOANS%20FROM%20RELATED%20PARTY) The company exchanged nonconvertible promissory notes from its CEO's entity (DE LLC) for convertible notes, resulting in a $0.8 million loss on extinguishment of debt. Additionally, notes from the CEO's brother (Mock Notes) remain outstanding - On **May 12, 2025**, the company exchanged **$2,242,873** in nonconvertible notes from DE LLC (CEO's entity) for convertible notes (DE New Notes) with extended maturities and a conversion price of **$1.00 per share**[69](index=69&type=chunk) - This exchange resulted in an **$835,324** loss on extinguishment of debt, recorded in the condensed consolidated statement of operations for H1 2025[69](index=69&type=chunk) - The company has **$983,112** in Mock Notes (from CEO's brother) outstanding, bearing **10% interest**, with no principal or interest payments made in H1 2025[72](index=72&type=chunk)[73](index=73&type=chunk) [NOTE 7 – FAIR VALUE MEASUREMENTS](index=18&type=section&id=NOTE%207%20%E2%80%93%20FAIR%20VALUE%20MEASUREMENTS) The company uses Level 3 inputs for fair value measurements of convertible notes and contingent consideration, with a gain recognized on the fair value change of a specific convertible note. The fair value of a warrant was nominal Fair Value Measurements | Financial Instrument | Level in Fair Value Hierarchy | June 30, 2025 (Fair Value) ($) | December 31, 2024 (Fair Value) ($) | | :------------------------------------ | :---------------------------- | :--------------------------- | :----------------------------- | | Convertible notes payable | 3 | 6,632,000 | 5,065,000 | | Convertible notes payable, related party | 3 | 3,246,259 | — | | Convertible note payable at fair value | 3 | 250,000 | 320,000 | | Contingent consideration | 3 | — | 486,000 | - A gain of **$70,000** was recorded for the six months ended June 30, 2025, from the change in fair value of the convertible note for which the fair value option was elected[53](index=53&type=chunk)[158](index=158&type=chunk) - The fair value of convertible notes is computed using a Monte Carlo Simulation, with assumptions including stock price, minimum conversion price, annual asset volatility, and risk-free discount rate[80](index=80&type=chunk) [NOTE 8 – STOCKHOLDERS' EQUITY](index=21&type=section&id=NOTE%208%20%E2%80%93%20STOCKHOLDERS'%20EQUITY) The company did not sell common stock under the 2022 Lincoln Park Purchase Agreement in H1 2025, but issued shares in H1 2024. Shareholder approval was obtained to decrease the voting rights of Series C Convertible Preferred Stock, and shares were issued for a Special Projects working capital adjustment in 2024 - No shares were sold under the LP 2022 Purchase Agreement during the three and six months ended **June 30, 2025**[84](index=84&type=chunk) - Shareholders approved an amendment on **January 21, 2025**, to decrease the conversion votes per share of Series C Convertible Preferred Stock from **ten to three votes per share**[86](index=86&type=chunk) - In **May 2024**, **357,289 shares** of common stock were issued for a Special Projects working capital adjustment, increasing the purchase price and goodwill[87](index=87&type=chunk) [NOTE 9 – LOSS PER SHARE](index=23&type=section&id=NOTE%209%20%E2%80%93%20LOSS%20PER%20SHARE) Basic and diluted loss per share increased for the six months ended June 30, 2025, compared to the prior year, with potentially dilutive instruments excluded from diluted EPS calculation due to their antidilutive effect Loss Per Share Data | Metric | Three Months Ended June 30, 2025 ($) | Three Months Ended June 30, 2024 ($) | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Basic loss per share | (0.13) | (0.17) | (0.33) | (0.20) | | Diluted loss per share | (0.13) | (0.17) | (0.34) | (0.20) | | Basic weighted average shares outstanding | 11,168,572 | 9,723,155 | 11,166,596 | 9,481,034 | | Diluted weighted average shares outstanding | 11,232,511 | 9,787,094 | 11,230,535 | 9,544,973 | - Potentially dilutive instruments, including convertible notes and warrants, were excluded from diluted EPS calculations for both periods as their inclusion would have been antidilutive due to the net loss[90](index=90&type=chunk)[91](index=91&type=chunk) [NOTE 10 — RELATED PARTY TRANSACTIONS](index=23&type=section&id=NOTE%2010%20%E2%80%94%20RELATED%20PARTY%20TRANSACTIONS) The company has significant accrued compensation and interest owed to its CEO, totaling $2.6 million in compensation and $1.6 million in accrued interest as of June 30, 2025. A consulting agreement was also entered with a director - Accrued compensation to the CEO totaled **$2,625,000** as of June 30, 2025, along with **$1,633,976** in accrued interest, both payable on demand[92](index=92&type=chunk)[93](index=93&type=chunk) - Interest expense related to CEO's accrued compensation was **$130,171** for the six months ended June 30, 2025, with no cash payments made[94](index=94&type=chunk) - A one-year consulting agreement was signed with director Hilarie Bass for **$100,000**, providing commercial litigation advice[95](index=95&type=chunk) [NOTE 11 — SEGMENT INFORMATION](index=25&type=section&id=NOTE%2011%20%E2%80%94%20SEGMENT%20INFORMATION) The Entertainment Publicity and Marketing (EPM) segment showed adjusted income from operations, while the Content Production (CPD) segment reported an adjusted loss, reflecting the company's primary focus on marketing services Adjusted Income (Loss) from Operations by Segment | Segment | Six Months Ended June 30, 2025 (Adjusted Income (Loss) from Operations) ($) | Six Months Ended June 30, 2024 (Adjusted Income (Loss) from Operations) ($) | | :-------------------------------- | :------------------------------------------------------ | :------------------------------------------------------ | | Entertainment Publicity and Marketing | 1,540,030 | 1,127,241 | | Content Production | (1,593,877) | (495,825) | | Total Adjusted Income (Loss) from Operations | (53,847) | 631,416 | - EPM segment revenue increased to **$26.2 million** in H1 2025 from **$23.3 million** in H1 2024, while CPD segment revenue significantly decreased to **$92,033** from **$3.4 million**[102](index=102&type=chunk)[106](index=106&type=chunk) - All goodwill and intangible assets are assigned to the EPM segment, totaling **$21.5 million** and **$9.0 million** (net), respectively, as of June 30, 2025[106](index=106&type=chunk) [NOTE 12 — LEASES](index=27&type=section&id=NOTE%2012%20%E2%80%94%20LEASES) The company holds both operating and finance leases for office space, with total operating lease liabilities of $4.2 million and finance lease liabilities of $0.15 million as of June 30, 2025. Cash payments for operating leases decreased in H1 2025 Lease Liabilities | Lease Type | June 30, 2025 (Total Lease Liability) ($) | December 31, 2024 (Total Lease Liability) ($) | | :---------------- | :------------------------------------ | :---------------------------------------- | | Operating Leases | 4,169,310 | 5,086,614 | | Finance Leases | 150,222 | 139,091 | - Cash payments for operating leases were **$1,129,444** for the six months ended June 30, 2025, a decrease from **$1,333,342** in the prior year[114](index=114&type=chunk) - The weighted average remaining lease term for operating leases is **3.96 years**, and for finance leases is **1.83 years**, as of June 30, 2025[115](index=115&type=chunk) [NOTE 13 — COLLABORATIVE ARRANGEMENT](index=30&type=section&id=NOTE%2013%20%E2%80%94%20COLLABORATIVE%20ARRANGEMENT) The company co-produced and co-financed 'The Blue Angels' documentary with IMAX, which was distributed by Amazon. Revenue from this agreement was recognized in 2024 upon film delivery - The company co-produced and co-financed 'The Blue Angels' documentary with IMAX, contributing **$2,250,000** to production costs[116](index=116&type=chunk) - Net revenues of **$3,421,141** were recorded in H1 2024 from the Amazon Agreement for distribution rights of 'The Blue Angels' upon film delivery[34](index=34&type=chunk)[118](index=118&type=chunk) [NOTE 14— COMMITMENTS AND CONTINGENCIES](index=30&type=section&id=NOTE%2014%E2%80%94%20COMMITMENTS%20AND%20CONTINGENCIES) The company is involved in a lawsuit against the Socialyte seller and its principals for alleged breach of contract, fraud, and negligence, with a trial scheduled for February 2026. No estimate of potential loss can be made at this early stage - A complaint was filed on **June 21, 2024**, against NSL Ventures (Socialyte seller) and its principals for alleged breach of the Socialyte Purchase Agreement, fraud, and negligence[119](index=119&type=chunk) - NSL Ventures filed a cross-complaint for breach of contract, and the trial is scheduled for **February 2026**[119](index=119&type=chunk) - Due to the early stage of litigation, an estimate of any possible loss or range of loss cannot be made[119](index=119&type=chunk) [NOTE 15— SUBSEQUENT EVENTS](index=30&type=section&id=NOTE%2015%E2%80%94%20SUBSEQUENT%20EVENTS) Subsequent to June 30, 2025, the company entered into a new $15 million equity purchase agreement with Lincoln Park Capital Fund, LLC, issued additional convertible notes, and is assessing the impact of the recently signed One Big Beautiful Bill Act (OBBBA) on its financial statements - On **August 12, 2025**, the company entered into a new **$15,000,000** equity purchase agreement with Lincoln Park Capital Fund, LLC, allowing the sale of common stock over a **36-month term**[120](index=120&type=chunk) - The company issued **244,698 shares** of Common Stock to Lincoln Park as an initial commitment fee for the new purchase agreement[125](index=125&type=chunk) - The One Big Beautiful Bill Act (OBBBA) was signed into law on **July 4, 2025**, and the company is currently assessing its impact on consolidated financial statements[129](index=129&type=chunk)[130](index=130&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=33&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) This section provides management's perspective on the company's financial performance and condition, highlighting revenue trends, expense drivers, and liquidity. It details the performance of the Entertainment Publicity and Marketing (EPM) and Content Production (CPD) segments, explains changes in key financial metrics, and discusses debt and financing arrangements [Overview](index=33&type=section&id=Overview) Dolphin Entertainment, Inc. is a leading independent entertainment marketing and production company, pursuing an acquisition strategy for complementary businesses and an investment strategy ('Ventures' or 'Dolphin 2.0') to develop or acquire ownership stakes in entertainment content, live events, and consumer products - The company operates through subsidiaries like 42West, The Door, Shore Fire, The Digital Dept., Special Projects, Always Alpha, and Elle, providing strategic marketing and publicity services[132](index=132&type=chunk) - An acquisition strategy focuses on complementary entertainment publicity and marketing services and content production businesses to create synergistic opportunities[133](index=133&type=chunk) - The 'Ventures' investment strategy aims to develop or acquire ownership stakes in entertainment content, live events, and consumer products, leveraging existing marketing expertise[134](index=134&type=chunk) [HOW WE ASSESS THE PERFORMANCE OF OUR BUSINESS](index=33&type=section&id=HOW%20WE%20ASSESS%20THE%20PERFORMANCE%20OF%20OUR%20BUSINESS) The company assesses performance using key financial indicators such as revenues, direct costs, payroll and benefits, selling, general and administrative expenses, legal and professional expenses, other income/expense, and net income, across its two reportable segments: Entertainment Publicity and Marketing (EPM) and Content Production (CPD) - Key performance indicators include revenues, direct costs, payroll and benefits, selling, general and administrative expenses, legal and professional expenses, other income/expense (mainly interest and fair value changes), and net income[136](index=136&type=chunk) - The company operates in two reportable segments: Entertainment Publicity and Marketing (EPM) and Content Production (CPD)[137](index=137&type=chunk) [Entertainment Publicity and Marketing ("EPM")](index=34&type=section&id=Entertainment%20Publicity%20and%20Marketing%20(%22EPM%22)) The EPM segment generates revenue from diverse marketing services, including celebrity talent services, entertainment marketing and brand strategy, strategic communications, digital media influencer campaigns, and celebrity booking for live events, with fees collected through fixed monthly retainers, percentage-based contracts, or project-based fees - Revenue is driven by client retention, spending levels, and new client acquisition, with a stable client base and organic growth through referrals[138](index=138&type=chunk) - Key revenue sources include talent services, entertainment marketing and brand strategy, strategic communications, digital media influencer marketing campaigns, and celebrity booking and live event programming[139](index=139&type=chunk) [Content Production ("CPD")](index=35&type=section&id=Content%20Production%20(%22CPD%22)) The CPD segment focuses on project development for digital, television, or motion picture productions, seeking third-party financing for future projects. The segment recognized significant revenue in 2024 from 'The Blue Angels' documentary and is partnering on a 'Youngblood' movie reboot expected in September 2025 - The CPD team identifies scripts, story treatments, and novels for acquisition, development, and production, with future projects contingent on obtaining financing[140](index=140&type=chunk)[141](index=141&type=chunk) - The Blue Angels documentary, co-produced with IMAX, generated **$3,421,141** in revenue from the Amazon Agreement during the six months ended June 30, 2024[142](index=142&type=chunk) - Dolphin Films partnered with Aircraft Productions in **February 2025** to produce a reboot of the movie 'Youngblood,' expected to be completed by **September 2025**[143](index=143&type=chunk) [Revenues](index=35&type=section&id=Revenues) For the three months ended June 30, 2025, all revenues were derived from the EPM segment. For the six months ended June 30, 2025, EPM accounted for 99.6% of total revenue, while CPD contributed 0.4%, a significant shift from 2024 when CPD had a 13.1% share due to the Blue Angels film Revenue Contribution by Segment | Segment | Q2 2025 (%) | Q2 2024 (%) | H1 2025 (%) | H1 2024 (%) | | :-------------------------- | :------ | :------ | :------ | :------ | | Entertainment publicity and marketing | 100 | 100 | 99.6 | 86.9 | | Content production | — | — | 0.4 | 13.1 | | Total revenue | 100 | 100 | 100 | 100 | - The majority of revenues for both periods were from the entertainment publicity and marketing segment[144](index=144&type=chunk) - Content production revenue in H1 2025 was minimal (**$92,033**) compared to H1 2024 (**$3,421,141**) due to the prior year's Blue Angels film distribution[144](index=144&type=chunk) [Expenses](index=35&type=section&id=Expenses) Expenses include direct costs, payroll and benefits, selling, general and administrative, acquisition costs, impairment of goodwill, depreciation and amortization, and legal and professional fees, with direct costs and payroll showing notable changes year-over-year - Direct costs increased by **$0.5 million** in Q2 2025 due to Digital Dept. showrooms but decreased by **$1.4 million** in H1 2025 due to the absence of Blue Angels film amortization[151](index=151&type=chunk) - Payroll and benefits expenses increased by **$1.1 million** in Q2 2025 and **$1.8 million** in H1 2025, primarily due to the inclusion of Elle and Always Alpha payroll expenses[152](index=152&type=chunk) - Acquisition costs of **$0.4 million** were recorded in H1 2025 for a Special Projects working capital adjustment, with no such costs in prior periods[154](index=154&type=chunk) [Other (Expense) Income](index=36&type=section&id=Other%20(Expense)%20Income) Other expense (income) primarily consists of changes in fair value of convertible notes, interest income, and interest expense. A significant loss on extinguishment of debt was recorded in H1 2025 - Other expense (income) includes changes in fair value of convertible notes, interest income, and interest expense[147](index=147&type=chunk) - A loss on extinguishment of debt was recorded for the three and six months ended June 30, 2025[147](index=147&type=chunk) [RESULTS OF OPERATIONS](index=37&type=section&id=RESULTS%20OF%20OPERATIONS) The company experienced increased revenues in its EPM segment but a significant decline in CPD revenue due to the prior year's Blue Angels film. Total expenses increased, driven by payroll and acquisition costs, while a substantial loss on debt extinguishment contributed to a higher net loss for the six months ended June 30, 2025 [Revenues](index=37&type=section&id=Revenues_Results) Entertainment publicity and marketing revenues increased by $2.6 million for the three months and $2.9 million for the six months ended June 30, 2025, primarily due to the inclusion of Elle and growth in The Digital Dept. and Special Projects. Content production revenues decreased significantly due to the prior year's Blue Angels film distribution Revenues by Segment | Segment | Three Months Ended June 30, 2025 ($) | Three Months Ended June 30, 2024 ($) | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Entertainment publicity and marketing | 14,087,529 | 11,449,089 | 26,165,207 | 23,263,840 | | Content production | — | — | 92,033 | 3,421,141 | | Total revenue | 14,087,529 | 11,449,089 | 26,257,240 | 26,684,981 | - EPM revenue increase for the three months was driven by Elle (**$0.9M**), The Digital Dept. (**$0.8M**), Special Projects (**$0.6M**), and The Door (**$0.3M**)[149](index=149&type=chunk) - CPD revenue decreased by approximately **$3.3 million** for the six months ended June 30, 2025, due to the Amazon Agreement for The Blue Angels film being recognized in 2024[150](index=150&type=chunk) [Expenses](index=37&type=section&id=Expenses_Results) Total expenses increased for the three months ended June 30, 2025, but slightly for the six months, primarily due to higher payroll and benefits from acquisitions (Elle, Always Alpha) and acquisition costs related to Special Projects. Direct costs decreased for the six-month period due to the absence of film amortization Expenses by Category | Expense Category | Three Months Ended June 30, 2025 ($) | Three Months Ended June 30, 2024 ($) | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Direct costs | 742,171 | 216,247 | 1,086,585 | 2,535,474 | | Payroll and benefits | 10,302,292 | 9,195,018 | 20,606,985 | 18,769,269 | | Selling, general and administrative | 1,922,336 | 1,864,852 | 3,694,319 | 3,841,843 | | Acquisition cost | — | — | 416,171 | — | | Impairment of goodwill | — | 190,565 | — | 190,565 | - Payroll and benefits increased by **$1.1 million** (Q2) and **$1.8 million** (H1) YoY, mainly due to Elle and Always Alpha payroll expenses[152](index=152&type=chunk) - Selling, general and administrative expenses decreased by **$0.15 million** for the six months ended June 30, 2025, primarily due to a decrease in office rent expense from lease expirations[153](index=153&type=chunk) [Other Expense (Income), net](index=39&type=section&id=Other%20Expense%20(Income),%20net_Results) Total other expenses increased significantly for both the three and six months ended June 30, 2025, primarily due to an $0.8 million loss on extinguishment of debt from the exchange of related party notes, coupled with higher interest expense Other (Expense) Income, Net | Other (expense) income, net | Three Months Ended June 30, 2025 ($) | Three Months Ended June 30, 2024 ($) | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Change in fair value of convertible notes | 50,000 | 40,000 | 70,000 | 65,000 | | Loss on extinguishment of debt | (835,324) | — | (835,324) | — | | Interest expense | (561,222) | (522,184) | (1,121,310) | (1,025,821) | | Total other (expenses) income, net | (1,335,341) | (481,453) | (1,869,355) | (949,221) | - A **$0.8 million** loss on extinguishment of debt was recorded in H1 2025 due to the exchange of nonconvertible notes from the CEO for convertible notes[160](index=160&type=chunk) - Interest expense increased by **$0.04 million** (Q2) and **$0.1 million** (H1) YoY, driven by new convertible and nonconvertible notes and the Second BKU Term Loan[162](index=162&type=chunk) [Income Taxes](index=39&type=section&id=Income%20Taxes_Results) Income tax expense remained relatively stable, reflecting the accrual of a valuation allowance due to limitations on using indefinite-lived tax assets to offset indefinite-lived tax liabilities Income Tax Expense | Metric | Three Months Ended June 30, 2025 ($) | Three Months Ended June 30, 2024 ($) | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :---------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Income tax expense | (21,523) | (23,540) | (43,045) | (47,079) | - The income tax expense reflects the accrual of a valuation allowance due to limitations on offsetting indefinite-lived tax assets against indefinite-lived tax liabilities[164](index=164&type=chunk) [Net Loss](index=41&type=section&id=Net%20Loss_Results) The net loss for the three months ended June 30, 2025, was $1.4 million, an improvement from $1.62 million in the prior year. However, the net loss for the six months ended June 30, 2025, significantly increased to $3.7 million from $1.95 million in the prior year, primarily due to the factors discussed above, including the loss on extinguishment of debt Net Loss and Loss Per Share | Metric | Three Months Ended June 30, 2025 ($) | Three Months Ended June 30, 2024 ($) | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss | (1,413,918) | (1,624,458) | (3,742,980) | (1,951,226) | | Basic loss per share | (0.13) | (0.17) | (0.33) | (0.20) | | Diluted loss per share | (0.13) | (0.17) | (0.34) | (0.20) | - The increase in net loss for the six months ended June 30, 2025, was primarily driven by the loss on extinguishment of debt and higher interest expenses[166](index=166&type=chunk) [LIQUIDITY AND CAPITAL RESOURCES](index=41&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) The company's liquidity saw a shift from cash provided by operating activities in 2024 to cash used in 2025, with financing activities providing less cash. Total debt increased, and the company entered into a new equity line of credit agreement with Lincoln Park Capital Fund, LLC, post-period end [Cash Flows](index=41&type=section&id=Cash%20Flows_Liquidity) Cash used in operating activities for the six months ended June 30, 2025, was $0.2 million, a significant change from $0.7 million provided in the prior year. Financing activities provided $0.7 million, down from $2.8 million in 2024, leading to a smaller net increase in cash Cash Flow Summary | Cash Flow Activity | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :----------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | (197,522) | 661,239 | | Net cash used in investing activities | (1,088) | (1,136,510) | | Net cash provided by financing activities | 692,128 | 2,761,515 | | Net increase in cash and cash equivalents and restricted cash | 493,518 | 2,286,244 | - The increase in cash used in operating activities was primarily due to a **$2.1 million** increase in net loss, partially offset by a **$2.5 million** net change in working capital[169](index=169&type=chunk) - Financing activities in H1 2025 included **$1.9 million** from convertible notes and **$0.6 million** from nonconvertible notes, offset by **$0.8 million** in term loan repayments and **$0.5 million** for contingent consideration[171](index=171&type=chunk) [Debt and Financing Arrangements](index=43&type=section&id=Debt%20and%20Financing%20Arrangements_Liquidity) Total debt increased to $23.5 million at June 30, 2025, driven by new convertible and nonconvertible notes, including related party debt. The company entered into a new $15 million equity purchase agreement with Lincoln Park post-period end to support working capital and general corporate purposes - Total debt increased by **$1.1 million** to **$23.5 million** as of June 30, 2025, primarily due to an increase in convertible and nonconvertible promissory notes[173](index=173&type=chunk) - The company expects its current cash, operational cash generation, and available funds to meet its **$5.6 million** debt obligations in the next twelve months[174](index=174&type=chunk) - Subsequent to June 30, 2025, the company entered into a new **$15,000,000** equity purchase agreement with Lincoln Park Capital Fund, LLC, allowing for the sale of common stock over **36 months** for working capital and general corporate purposes[120](index=120&type=chunk)[128](index=128&type=chunk) [Critical Accounting Estimates](index=49&type=section&id=Critical%20Accounting%20Estimates) The most critical accounting estimates involve fair value assessments for acquisitions, goodwill, intangible assets, acquisition-related contingent consideration, and convertible debt, as these require significant judgment and can materially impact financial statements - Critical accounting estimates include fair value estimates for acquisitions, goodwill, intangible assets, acquisition-related contingent consideration, and convertible debt[209](index=209&type=chunk) - These estimates are considered critical due to their reliance on assumptions about uncertain future events and their potential material impact on consolidated financial statements[208](index=208&type=chunk)[209](index=209&type=chunk) [Recent Accounting Pronouncements](index=49&type=section&id=Recent%20Accounting%20Pronouncements) For a discussion of recent accounting pronouncements, refer to Note 1 to the unaudited condensed consolidated financial statements - Refer to Note 1 for details on recent accounting pronouncements, including ASU 2023-09 (Income Taxes) and ASU 2024-03 (Disaggregation of Income Statement Expenses)[210](index=210&type=chunk) [SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS](index=49&type=section&id=SPECIAL%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section contains forward-looking statements based on current plans and expectations, which are subject to risks and uncertainties. Readers are cautioned not to place undue reliance on these statements and to refer to 'Risk Factors' in the Annual Report on Form 10-K for potential material differences in actual results - Forward-looking statements are based on assumptions and assessments of historical trends, current conditions, and future developments[213](index=213&type=chunk) - These statements are not guarantees of future performance and are subject to risks and uncertainties, many outside the company's control[213](index=213&type=chunk) - Readers should refer to the 'Risk Factors' section in the Annual Report on Form 10-K for factors that could cause actual results to differ materially[214](index=214&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=49&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded that the company's disclosure controls and procedures were not effective as of June 30, 2025, due to un-remediated material weaknesses identified in the prior annual report. Remediation efforts are underway, with no material changes in internal control over financial reporting during the quarter [Management's Report on the Effectiveness of Disclosure Controls and Procedures](index=49&type=section&id=Management's%20Report%20on%20the%20Effectiveness%20of%20Disclosure%20Controls%20and%20Procedures) The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were not effective as of June 30, 2025, due to material weaknesses previously disclosed in the Annual Report on Form 10-K that have not yet been remediated - Disclosure controls and procedures were deemed **not effective** as of June 30, 2025[216](index=216&type=chunk) - This conclusion is based on un-remediated material weaknesses disclosed in the Annual Report on Form 10-K for the year ended **December 31, 2024**[216](index=216&type=chunk) [Remediation of Material Weaknesses in Internal Control over Financial Reporting](index=50&type=section&id=Remediation%20of%20Material%20Weaknesses%20in%20Internal%20Control%20over%20Financial%20Reporting) The company has initiated remediation efforts to improve internal control over financial reporting, including developing formal policies for fraud risk assessment, enhancing management review, engaging third-party consultants for complex transactions, and strengthening period-end closing procedures and independent review of journal entries - Remediation efforts include developing formal policies for fraud risk assessment and risk management[219](index=219&type=chunk) - The company is enhancing management review precision, engaging third-party consultants for complex transactions, and improving period-end closing procedures[219](index=219&type=chunk) - Policies and procedures are being implemented to enhance independent review and documentation of journal entries, including segregation of duties[219](index=219&type=chunk) [Changes in Internal Control over Financial Reporting](index=50&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) There were no changes in the company's internal control over financial reporting during the most recently completed fiscal quarter that materially affected, or are reasonably likely to materially affect, its internal control over financial reporting - No material changes in internal control over financial reporting occurred during the quarter ended **June 30, 2025**[218](index=218&type=chunk) [PART II — OTHER INFORMATION](index=51&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) This section provides additional information including legal proceedings, risk factors, equity sales, defaults, mine safety, other disclosures, and exhibits [ITEM 1. LEGAL PROCEEDINGS](index=51&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company is engaged in a lawsuit against NSL Ventures, the Socialyte seller, and its principals, alleging breach of contract, fraud, and negligence, with a trial scheduled for February 2026. A cross-complaint has also been filed against the company - The company filed a complaint on **June 21, 2024**, against NSL Ventures and its principals for alleged breach of the Socialyte Purchase Agreement, fraud, and negligence[221](index=221&type=chunk) - NSL Ventures filed a cross-complaint against the company for breach of contract[221](index=221&type=chunk) - Trial for the litigation is scheduled for **February 2026**, and an estimate of any possible loss cannot be made at this time[221](index=221&type=chunk) [ITEM 1A. RISK FACTORS](index=51&type=section&id=ITEM%201A.%20RISK%20FACTORS) As a 'smaller reporting company,' the registrant is not required to provide a detailed discussion of risk factors in this quarterly report - The company is a 'smaller reporting company' and is not required to disclose risk factors in this Form 10-Q[222](index=222&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=51&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) There were no unregistered sales of equity securities or use of proceeds to report for the period - No unregistered sales of equity securities or use of proceeds to report[222](index=222&type=chunk) [ITEM 3. DEFAULTS UPON SENIOR SECURITIES](index=51&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) There were no defaults upon senior securities to report for the period - No defaults upon senior securities to report[223](index=223&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=51&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) There were no mine safety disclosures to report for the period - No mine safety disclosures to report[224](index=224&type=chunk) [ITEM 5. OTHER INFORMATION](index=51&type=section&id=ITEM%205.%20OTHER%20INFORMATION) This section details subsequent events, including a new $15 million equity purchase agreement with Lincoln Park Capital Fund, LLC, and the issuance of additional convertible promissory notes to investors, along with the related registration rights and terms [Item 1.01 Entry into a Material Definitive Agreement](index=51&type=section&id=Item%201.01%20Entry%20into%20a%20Material%20Definitive%20Agreement) On August 12, 2025, the company entered into a new $15 million equity purchase agreement with Lincoln Park Capital Fund, LLC, allowing the company to sell common stock over a 36-month term, with specific purchase terms and volume limitations. An initial commitment fee of 244,698 shares was issued to Lincoln Park - The company entered into a 2025 LP Purchase Agreement with Lincoln Park Capital Fund, LLC, to sell up to **$15,000,000** of common stock over **36 months**[226](index=226&type=chunk) - Regular Purchases allow the company to sell up to **20,000 shares** daily (or more at higher stock prices), with a maximum commitment of **$500,000** per purchase, at **97%** of the lesser of the lowest sale price or the average of the three lowest closing prices[227](index=227&type=chunk) - An initial fee of **244,698 shares** of Common Stock was issued to Lincoln Park for its commitment[231](index=231&type=chunk) [Item 3.02 Unregistered Sales of Equity Securities.](index=54&type=section&id=Item%203.02%20Unregistered%20Sales%20of%20Equity%20Securities.) Between May 30, 2025, and July 28, 2025, the company issued five convertible promissory notes totaling $660,000 to investors, bearing 10% interest and convertible into common stock at various fixed conversion prices, in reliance on the Section 4(a)(2) exemption from registration - Five convertible promissory notes, totaling **$660,000**, were issued to investors between **May 30, 2025**, and **July 28, 2025**[239](index=239&type=chunk) - These notes bear **10% interest** per annum and are convertible into common stock at conversion prices ranging from **$1.06** to **$1.28 per share**[239](index=239&type=chunk) - The issuance was made in reliance upon the exemption from registration provided by Section 4(a)(2) of the Securities Act[241](index=241&type=chunk) [ITEM 6. EXHIBITS](index=55&type=section&id=ITEM%206.%20EXHIBITS) This section lists all exhibits filed with the Form 10-Q, including articles of incorporation, bylaws, various agreements (e.g., Lincoln Park Purchase Agreement, Bass Consulting Agreement), and certifications - Exhibits include organizational documents (Amended and Restated Articles of Incorporation, Bylaws), material agreements (Lincoln Park Registration Rights Agreement, Bass Consulting Agreement, Dolphin Entertainment LLC Note Exchange Agreement, Lincoln Park Purchase Agreement), and certifications (CEO/CFO Sarbanes-Oxley Act certifications)[243](index=243&type=chunk) [SIGNATURES](index=56&type=section&id=SIGNATURES) The report is signed by William O'Dowd IV, Chief Executive Officer, and Mirta A Negrini, Chief Financial Officer, on behalf of Dolphin Entertainment, Inc., as of August 14, 2025 - The report was signed by William O'Dowd IV, Chief Executive Officer, and Mirta A Negrini, Chief Financial Officer, on **August 14, 2025**[247](index=247&type=chunk)[249](index=249&type=chunk)

Financial Data and Key Metrics Changes - Total revenue for Q2 2025 reached a record $14.1 million, representing a 23% increase year over year from $11.4 million in Q2 2024 [4][20] - Adjusted operating income was approximately $628,000 compared to an adjusted operating loss of $137,000 in the same period of 2024 [4][20] - Operating loss decreased to approximately $57,000 from $1.1 million in Q2 2024 [20] Business Line Data and Key Metrics Changes - Each of the seven operating subsidiaries experienced steady growth, contributing to broad revenue increases [23][25] - The event company had a particularly strong quarter, with expectations for continued growth in the second half of the year [24] - The digital department and music PR firm also showed strong performance throughout the summer [24] Market Data and Key Metrics Changes - The company anticipates significant free cash flow generation over the next three years due to the expiration of long-term leases and repayment of commercial bank loans [6][48] - The market is moving towards comprehensive solutions, and the company is positioning itself at the forefront of this evolution with new service offerings [15] Company Strategy and Development Direction - The creation of the Tastemakers division exemplifies the company's broader growth strategy by integrating services across subsidiaries to maximize commercial opportunities [9][15] - The company aims to innovate within its existing portfolio to generate new revenue streams and deepen client relationships [14] - Future initiatives are being explored in other verticals where combined expertise can create differentiated offerings [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's trajectory, highlighting the potential for significant cash flow and margin improvement in the coming years [5][6] - The company is optimistic about the upcoming premiere of the film "Youngblood" at the Toronto International Film Festival, which could lead to successful distribution opportunities [17][38] - Management emphasized the importance of continued investment in women's sports and affiliate marketing as strategic growth areas [31][32] Other Important Information - The company is actively negotiating for a follow-up project to "Blue Angels" with IMAX, indicating ongoing interest in expanding its film production capabilities [54] - Management's personal investment in the company underscores confidence in its value creation for shareholders [18] Q&A Session Summary Question: Where did the revenue upside come from in the quarter? - Management indicated that revenue growth was broad-based across all subsidiaries, with no single factor driving the increase [23][25] Question: How are investments in Always Alpha and affiliate marketing progressing? - Management noted that while adjusted operating income was strong, it was somewhat depressed by ongoing investments in these areas, which are expected to pay off in 2026 and beyond [27][30] Question: What are the production costs for "Youngblood" and how are they accounted for? - Management explained that the film was produced with a budget between $5 million and $15 million, financed through partnerships, and emphasized the potential upside from its sale [37][42] Question: Is there any seasonality in the business? - Management confirmed that Q1 is typically the weakest quarter, while Q4 is the strongest, with some subsidiaries experiencing seasonal fluctuations [50][52] Question: Are there plans for future projects with IMAX? - Management expressed a strong desire to negotiate a follow-up to "Blue Angels" and highlighted the importance of "Youngblood" as a reentry into scripted films [54][56]

[Executive Summary & Financial Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Financial%20Highlights) Dolphin reported strong Q2 2025 financial results, with revenue growth, improved profitability, and strategic investments highlighted by the CEO [CEO Commentary & Strategic Focus](index=1&type=section&id=CEO%20Commentary%20%26%20Strategic%20Focus) Dolphin's CEO highlighted strong Q2 performance, strategic investments in future growth, and anticipated profit margin expansion - Dolphin's Q2 revenue grew by **23% year-over-year**, reaching **$14.1 million**, exceeding expectations and demonstrating strong financial performance[2](index=2&type=chunk)[3](index=3&type=chunk) - The company strategically invested in future growth engines like women's sports and affiliate marketing, anticipating long-term returns after initial investment phases[3](index=3&type=chunk) - CEO Bill O'Dowd purchased approximately **1% of outstanding shares** since April 2025, demonstrating confidence in the company's value[2](index=2&type=chunk)[5](index=5&type=chunk) - Adjusted operating margins are expected to grow as Always Alpha and affiliate marketing investments decrease, real estate commitments expire, and bank loans are repaid[4](index=4&type=chunk) [Q2 2025 Financial Performance Overview](index=2&type=section&id=Q2%202025%20Financial%20Performance%20Overview) Dolphin's Q2 2025 saw revenue grow 23%, operating loss significantly narrow, and adjusted operating income turn profitable Q2 2025 Key Financial Metrics (Compared to Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | | :--------------------- | :--------------- | :--------------- | :--------------------- | | Total Revenue | $14.1 million | $11.4 million | +23% | | Operating Loss | $(57,000) | $(1.1) million | Significantly narrowed | | Adjusted Operating Income (Loss) | $0.6 million | $(0.1) million | Shifted to profit | | Net Loss | $(1.4) million | $(1.6) million | Reduced | | Net Loss Per Share (Basic) | $(0.13) | $(0.17) | Improved | | Net Loss Per Share (Diluted) | $(0.13) | $(0.17) | Improved | - Q2 2025 operating expenses were **$14.1 million**, including **$0.6 million** in depreciation and amortization and approximately **$0.1 million** in non-recurring or non-cash expenses, an increase from **$12.6 million** in Q2 2024[7](index=7&type=chunk) [Operational Highlights & Business Updates](index=3&type=section&id=Operational%20Highlights%20%26%20Business%20Updates) Dolphin's subsidiaries achieved significant Q2 2025 milestones, including new partnerships, industry awards, platform launches, and expanded marketing [Subsidiary & Division Achievements](index=3&type=section&id=Subsidiary%20%26%20Division%20Achievements) Dolphin's subsidiaries achieved Q2 2025 milestones, including new partnerships, Emmy nominations, platform launches, and diverse marketing support - Dolphin established a company-wide partnership with The Lumistella Company, leveraging its agency alliance for integrated marketing, media, and brand strategy for Elf on the Shelf® Santaverse™ and new IP extensions[13](index=13&type=chunk) - Dolphin demonstrated leadership in fan public relations at San Diego Comic-Con 2025, executing campaigns for top talent and brands like Amazon Studios, Funko, and Crunchyroll[13](index=13&type=chunk) - Dolphin's clients received **15 nominations** for the 77th Primetime Emmy Awards[13](index=13&type=chunk) - The Door and The Digital Dept. jointly launched Dolphin Tastemakers, combining talent management and media outreach to build impactful multi-dimensional brands for top talent like Rachael Ray, Josh Scherer, and Jeanine Donofrio[13](index=13&type=chunk) [42West](index=3&type=section&id=42West) 42West clients garnered significant industry recognition, including multiple Emmy nominations and high-profile fashion collaborations - 42West clients received **15 nominations** for the 77th Primetime Emmy Awards[13](index=13&type=chunk) - At the Met Gala, 42West client Christian Siriano designed custom looks for Lizzo, Bebe Rexha, and Alex Newell[13](index=13&type=chunk) [The Door / The Digital Dept. / DISRPT Agency](index=3&type=section&id=The%20Door%20%2F%20The%20Digital%20Dept.%20%2F%20DISRPT%20Agency) These agencies launched Dolphin Tastemakers, secured major client partnerships, and expanded influencer marketing, solidifying cultural influence - The Door and The Digital Dept. jointly launched Dolphin Tastemakers, empowering top talent and digital-native creators by combining talent management and media outreach[13](index=13&type=chunk)[17](index=17&type=chunk) - DISRPT Agency announced its 2025 client roster, including CultureCon and Edison Chen x Bad Bunny for adidas Originals, reinforcing its leadership in cultural influence[13](index=13&type=chunk) - The Digital Dept. debuted the BRANDEdit experience at CMA Fest 2025 and hosted its highest-grossing BRANDEdit influencer experience in Los Angeles to date[17](index=17&type=chunk) [Shore Fire Media](index=5&type=section&id=Shore%20Fire%20Media) Shore Fire Media secured PR for the Miles Davis Estate and supported high-profile music festivals and artists - Shore Fire Media was appointed as the public relations agency for the Miles Davis Estate ahead of its 2026 centennial celebration[17](index=17&type=chunk) - Shore Fire Media was selected to support several high-profile music festivals and concert series, including Summerfest and Montreux Jazz Festival Miami[17](index=17&type=chunk) - Long-term client Cyndi Lauper was inducted into the Rock & Roll Hall of Fame[17](index=17&type=chunk) [Special Projects](index=6&type=section&id=Special%20Projects) Special Projects curated star-studded lineups for major events like the Academy Museum Gala and Peabody Awards ceremony - Special Projects secured a star-studded lineup for the 2025 Academy Museum Gala, featuring Bruce Springsteen, Penélope Cruz, Walter Salles, and Bowen Yang[21](index=21&type=chunk) - Special Projects managed bookings for the 2025 Peabody Awards ceremony, successfully securing host Roy Wood, Jr. and several notable presenters and performers[21](index=21&type=chunk) [Always Alpha](index=6&type=section&id=Always%20Alpha) Always Alpha strengthened its women's sports management team with key hires and elevated women's sports profile at Cannes Lions - Malea Hotson and Tracy Hughes joined Always Alpha, bringing decades of expertise to the women's sports management team to drive innovation and growth in the sector[21](index=21&type=chunk) - Always Alpha elevated the profile of women's sports at the 2025 Cannes Lions International Festival of Creativity through high-profile events and panel discussions[21](index=21&type=chunk) [Youngblood (Film Adaptation)](index=6&type=section&id=Youngblood%20%28Film%20Adaptation%29) Dolphin's film adaptation, *Youngblood*, is set to premiere at the 2025 Toronto International Film Festival - Dolphin announced its film adaptation, *Youngblood*, has been selected to premiere at the 2025 Toronto International Film Festival[20](index=20&type=chunk) [Company Information](index=7&type=section&id=Company%20Information) Dolphin (NASDAQ:DLPN) provided a business overview, announced Q2 earnings call details, and included standard forward-looking statements [About Dolphin & Business Divisions](index=7&type=section&id=About%20Dolphin%20%26%20Business%20Divisions) Founded in 1996, Dolphin (NASDAQ:DLPN) evolved into three dynamic divisions, with Dolphin Marketing recognized as a top agency - Dolphin, founded by Bill O'Dowd in 1996, began as an Emmy-nominated television, digital, and film content production company[23](index=23&type=chunk) - The company now comprises three core divisions: Dolphin Entertainment (content production), Dolphin Marketing (PR, influencer marketing, brand strategy), and Dolphin Ventures (accelerating innovative ideas and products)[23](index=23&type=chunk)[24](index=24&type=chunk)[25](index=25&type=chunk)[26](index=26&type=chunk) - The Dolphin Marketing division was named a Top Agency of 2025 by Observer[25](index=25&type=chunk) [Conference Call & Investor Relations](index=7&type=section&id=Conference%20Call%20%26%20Investor%20Relations) Dolphin scheduled an August 13, 2025 webcast and conference call to discuss Q2 2025 results, with participation and replay details provided - The company will host a Q2 2025 earnings conference call and webcast on Wednesday, August 13, 2025, at **4:30 PM ET**[22](index=22&type=chunk) - Toll-free, international dial-in numbers, participant access codes, webcast links, and replay information are provided[22](index=22&type=chunk) [Forward-Looking Statements & Disclaimer](index=7&type=section&id=Forward-Looking%20Statements%20%26%20Disclaimer) This press release contains forward-looking statements on Dolphin's stock offerings and financial results, subject to risks and no update obligation - This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act, concerning stock offerings and anticipated financial and operational results[27](index=27&type=chunk) - Forward-looking statements involve unpredictable risks and uncertainties, where actual results may differ materially from those discussed[27](index=27&type=chunk)[28](index=28&type=chunk) - Dolphin Entertainment assumes no obligation to update any forward-looking statements unless required by applicable law[28](index=28&type=chunk) [Financial Statements](index=9&type=section&id=Financial%20Statements) Dolphin's Q2 2025 financial statements show revenue growth, narrowed operating losses, and a GAAP to non-GAAP adjusted operating income reconciliation [Condensed Consolidated Balance Sheets](index=9&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, Dolphin's total assets slightly increased to **$58.61 million**, with growing current assets but decreasing shareholder equity Condensed Consolidated Balance Sheets Key Data | Metric | June 30, 2025 ($) | December 31, 2024 ($) | | :--------------------- | :--------------- | :--------------- | | Cash and Cash Equivalents | 8,697,360 | 8,203,842 | | Total Current Assets | 22,156,949 | 20,067,099 | | Total Assets | 58,611,434 | 58,437,279 | | Total Current Liabilities | 29,131,730 | 26,514,137 | | Total Liabilities | 50,709,023 | 46,791,888 | | Total Stockholders' Equity | 7,902,411 | 11,645,391 | [Condensed Consolidated Statements of Operations](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Dolphin's Q2 2025 revenue grew **23%** to **$14.09 million**, with narrowed operating and net losses, despite increased year-to-date losses Condensed Consolidated Statements of Operations Key Data | Metric | Q2 2025 ($) | Q2 2024 ($) | H1 2025 ($) | H1 2024 ($) | | :--------------------- | :--------------- | :--------------- | :--------------- | :--------------- | | Revenue | 14,087,529 | 11,449,089 | 26,257,240 | 26,684,981 | | Total Expenses | 14,144,583 | 12,568,554 | 28,087,820 | 27,639,907 | | Operating Loss | (57,054) | (1,119,465) | (1,830,580) | (954,926) | | Net Loss | (1,413,918) | (1,624,458) | (3,742,980) | (1,951,226) | | Basic Loss Per Share | (0.13) | (0.17) | (0.33) | (0.20) | | Diluted Loss Per Share | (0.13) | (0.17) | (0.34) | (0.20) | [Reconciliation of Non-GAAP Measures](index=12&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) Dolphin's Q2 2025 GAAP operating loss of **$57,000** adjusted to non-GAAP operating income of **$627,905**, reflecting core business profitability Reconciliation of GAAP Operating Loss to Non-GAAP Adjusted Operating Income (Loss) | Metric | Q2 2025 ($) | Q2 2024 ($) | H1 2025 ($) | H1 2024 ($) | | :--------------------------------- | :--------------- | :--------------- | :--------------- | :--------------- | | Operating Loss (GAAP) | (57,054) | (1,119,465) | (1,830,580) | (954,926) | | **Adjustments:** | | | | | | Depreciation and Amortization | 591,552 | 555,694 | 1,183,104 | 1,108,797 | | Bad Debt Expense | 93,407 | 82,959 | 149,161 | 286,980 | | Acquisition Costs | — | — | 416,171 | — | | Goodwill Impairment | — | 190,565 | — | 190,565 | | Stock-Based Compensation | — | 153,291 | — | 259,052 | | **Adjusted Operating Income (Loss) (Non-GAAP)** | 627,905 | (136,956) | (82,144) | 890,468 |

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $12.2 million, down from $15.2 million in Q1 2024, primarily due to a one-time contribution of $3.4 million from the Blue Angels documentary in the previous year [3][15] - Excluding the one-time revenue, core entertainment, publicity, and marketing revenue grew by 2% year over year [3][15] - Adjusted operating loss for Q1 2025 was approximately $600,000, comparable to the previous year's adjusted operating income of $1 million when excluding the Blue Angels revenue [4][16] - Net loss for Q1 2025 was $2.3 million, compared to a net loss of $300,000 in Q1 2024 [16][17] Business Line Data and Key Metrics Changes - The women's sports management firm, Always Alpha, is expected to double its roster of represented athletes and sportscasters by the end of 2025, with plans to expand into women's soccer and basketball [5][7] - The Digital Department launched a dedicated affiliate marketing division, aiming to triple the number of influencers on its roster by the end of the year [8][30] Market Data and Key Metrics Changes - The affiliate marketing sector is estimated to be over $17 billion globally, and the company aims to capture a significant share of this market through its new division [8][30] - The company has a backlog of affiliate influencers eager to work with them, indicating strong demand for their services [29][30] Company Strategy and Development Direction - The company is focusing on strategic investments in women's sports and affiliate marketing to broaden its addressable market and create sustainable growth opportunities [13][54] - The management emphasized the importance of increasing the frequency of film productions and expanding ventures as key priorities for 2025 [53][54] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of the LA wildfires on Q1 performance but expressed confidence in returning to normal operations in Q2 and beyond [57][58] - The company remains optimistic about achieving stronger growth in 2025, with no loss of confidence in its business outlook [57][58] Other Important Information - The company was named Agency of the Year by Observer's 2025 PR Power List, highlighting its strategic success and talent depth [12] - The film "Youngblood" is expected to premiere in February 2026, coinciding with the Winter Olympics, which presents a marketing opportunity [49][50] Q&A Session Summary Question: Growth strategy for Always Alpha and revenue potential - Management discussed the need for more managers to support the growth of Always Alpha and the expected timeline for revenue recognition from new talent [19][20][23] Question: Affiliate marketing strategy and influencer recruitment - Management explained the process of recruiting affiliate influencers and the expected quicker revenue turnaround compared to traditional brand representation [28][29][30] Question: Financial outlook and priorities for 2025 - Management reiterated the focus on growing Always Alpha and the affiliate division, alongside increasing film production frequency as top priorities for the year [53][56]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $12.2 million, down from $15.2 million in Q1 2024, primarily due to a one-time contribution of $3.4 million from the Blue Angels documentary in the previous year [4][16] - Excluding the one-time revenue, core entertainment, publicity, and marketing segment revenue grew by 2% year-over-year to $12.1 million, indicating underlying business strength despite challenges [4][16] - Adjusted operating loss for Q1 2025 was approximately $600,000, comparable to the previous year's adjusted operating income of $1 million when excluding the film revenue [5][17] - Net loss for Q1 2025 was $2.3 million, compared to a net loss of $300,000 in Q1 2024 [17][18] Business Line Data and Key Metrics Changes - The women's sports management firm, Always Alpha, is expected to double its roster of represented athletes and sportscasters by the end of 2025, with plans to expand into women's soccer and basketball [6][8] - The Digital Department launched a dedicated affiliate marketing division, aiming to triple the number of influencers on its roster by the end of the year [9][30] - The core entertainment, publicity, and marketing segment demonstrated resilience with a 2% revenue increase despite external challenges [16][60] Market Data and Key Metrics Changes - The affiliate marketing sector is estimated to be over $17 billion globally, and the company aims to capture a significant share of this market through its new division [9][30] - The company is positioned as a comprehensive agency in the women's sports space, enhancing its competitive edge in a rapidly growing market [6][34] Company Strategy and Development Direction - The company is focusing on strategic investments in women's sports and affiliate marketing to broaden its addressable market and create sustainable growth opportunities [14][54] - Plans to increase the frequency of film productions and expand ventures are also part of the growth strategy, with a focus on long-term success [55][66] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of the LA wildfires on Q1 performance but expressed confidence in returning to normal operations in Q2 and beyond [58][60] - The company remains optimistic about achieving stronger growth in 2025, with no loss of confidence in its business trajectory [58][61] Other Important Information - The company was named Agency of the Year by Observer's 2025 PR Power List, validating its strategy and talent depth [13] - The film "Youngblood" is targeting a February 2026 release, coinciding with the Winter Olympics, which is expected to enhance its marketability [50][51] Q&A Session Summary Question: Growth strategy for Always Alpha and revenue potential - Management discussed the need for more managers to support the growth of Always Alpha and the expected timeline for revenue recognition from new talent [20][22][26] Question: Affiliate marketing growth and strategy - Management explained the strategy for expanding the affiliate marketing division, emphasizing the potential for quick revenue generation and the importance of training affiliate managers [29][30][32] Question: Financial outlook and impact of past events - Management reiterated confidence in the company's growth trajectory despite past challenges, highlighting the resilience shown in Q1 revenue performance [57][60]

Revenue Performance - For the three months ended March 31, 2025, total revenue was $12,169,711, a decrease of approximately $3,066,181 compared to $15,235,892 for the same period in 2024[142]. - Revenue from the entertainment publicity and marketing segment increased to $12,077,678, representing 99.2% of total revenue, compared to 78.0% in the prior year[137]. - Revenue from content production decreased to $92,033, down approximately $3,329,108 from $3,421,141 in the previous year, primarily due to the revenue from The Blue Angels documentary[143]. Expense Analysis - Total expenses for the three months ended March 31, 2025, were $13,943,238, a decrease of approximately $1,128,114 from $15,071,352 in 2024[144]. - Direct costs decreased significantly to $344,414, down approximately $1,974,813 from $2,319,227 in the prior year, attributed to the amortization of production costs for The Blue Angels[144]. - Payroll and benefits expenses increased to $10,304,233, an increase of approximately $729,982 compared to $9,574,251 in the previous year, mainly due to the inclusion of Elle's payroll expenses[145]. - Selling, general and administrative expenses decreased to $1,772,444, down approximately $204,546 from $1,976,990 in the prior year, primarily due to reduced office rent expenses[146]. - Legal and professional fees decreased by $133 thousand for the three months ended March 31, 2025, primarily due to cost savings from bringing financial reporting in-house[149]. - Depreciation and amortization increased by $38 thousand for the three months ended March 31, 2025, compared to the same period in 2024[148]. Net Loss and Cash Flow - Net loss was approximately $2.3 million or ($0.21) per share for the three months ended March 31, 2025, compared to a net loss of approximately $0.3 million or ($0.04) per share for the same period in 2024[155]. - Cash used in operating activities was $1.7 million for the three months ended March 31, 2025, an increase of $0.5 million from the prior year[158]. - Cash flows provided by financing activities for the three months ended March 31, 2025 were $586 thousand, primarily from proceeds of convertible notes payable[160]. Debt and Financing - Total debt amounted to $23.0 million as of March 31, 2025, an increase of $597.1 thousand from December 31, 2024[161]. - The company issued six convertible notes payable during the three months ended March 31, 2025, receiving proceeds of $775,000[165]. - The company recorded a gain in fair value of $20 thousand for the convertible note payable at fair value for the three months ended March 31, 2025[171]. - The Socialyte Promissory Note, amounting to $3 million, matured on September 30, 2023, with no interest payments made during the three months ended March 31, 2025[176]. - As of March 31, 2025, the aggregate principal balance of DE LLC Notes was $2,242,873, with accrued interest of $434,066[180]. - The company issued three nonconvertible promissory notes totaling $983,112 to Mr. Donald Scott Mock, with accrued interest of $114,995 as of March 31, 2025[181]. - Interest expense related to DE LLC Notes and Mock Notes was $79,882 for the three months ended March 31, 2025, compared to $46,121 for the same period in 2024[182]. - The BankUnited Loan Agreement includes a $5,800,000 secured term loan, a $750,000 revolving line of credit, and a $400,000 commercial card[183]. - The Second Bank United Loan Agreement for $2.0 million was established to finance the acquisition of Elle Communications, LLC, maturing in December 2027[184]. - The First BKU Term Loan has an interest rate of 8.10% and a 5-year amortization schedule, while the Second BKU Term Loan has a 7.10% interest rate with a 3-year amortization[185]. - As of March 31, 2025, current liabilities were $1,708,051 and noncurrent liabilities were $4,349,537 related to the First and Second BKU Term Loans[187]. - The BankUnited Credit Facility requires a minimum debt service coverage ratio of 1.25:1.00 and a maximum funded debt/EBITDA ratio of 3.00:1.00[189]. - Amortization of debt origination costs under the Bank United Credit Facility amounted to approximately $7,012 for the three months ended March 31, 2025[188]. - The company recorded interest expense of $7,550 related to the BKU Line of Credit for the three months ended March 31, 2025[186]. Strategic Initiatives - The company has established an acquisition strategy to identify and acquire complementary businesses to enhance profits and cash flow, although no active negotiations are currently in place[127]. - The company plans to enter into Venture investments during 2025, focusing on developing internally owned assets in entertainment content, live events, and consumer products[128]. - Acquisition costs for the three months ended March 31, 2025, were $416,171, related to payments to Special Projects Sellers, with no acquisition costs recorded in the prior year[147].