Financial Performance - Q3 2025 net income was $8.8 million, or $0.73 per diluted share, compared to $7.5 million, or $0.62 per diluted share in Q3 2024, representing a 17.4% increase[6]. - Total revenue increased 37.8% to $184.6 million from $133.9 million, driven by acquisitions and organic growth[6]. - Adjusted EBITDA for Q3 2025 was $21.8 million, up 25.6% from $17.3 million in Q3 2024[6]. - Operating income for the three months ended September 30, 2025, increased to $13,345,000, a 22.6% rise compared to $10,888,000 in 2024[17]. - Net income for the nine months ended September 30, 2025, was $26,764,000, compared to $21,033,000 for the same period in 2024, reflecting a 27.3% increase[21]. - Adjusted EBITDA for the nine months ended September 30, 2025, was $54,585,000, up from $42,898,000 in 2024, reflecting a significant growth in operational performance[35]. - Operating income for the nine months ended September 30, 2025, was $31,898,000, representing a 24.6% increase from $25,610,000 in 2024[29]. - Adjusted diluted earnings per share for the nine months ended September 30, 2025, was $3.10, up from $2.46 in 2024[36]. Revenue Breakdown - Owner Direct Relationships (ODR) revenue rose 52.0% to $141.4 million, accounting for 76.6% of total revenue, with organic ODR revenue growth of 12.2%[6][7]. - The acquisition of Pioneer Power contributed $37.1 million to ODR revenue, with acquisition-related revenue accounting for 39.8% of the ODR segment's growth[7]. - Total revenue for the nine months ended September 30, 2025, was $459,932,000, representing a 22.6% increase from $375,131,000 in 2024[29]. - ODR revenue increased by 36.3% to $340,723,000, while GCR revenue decreased by 4.7% to $119,209,000[29]. - Acquisition-related revenue contributed $76,128,000 for the nine months ended September 30, 2025, accounting for 20.3% of total revenue growth[38]. Profitability Metrics - Total gross profit increased 23.7% to $44.7 million, with ODR gross profit rising 20.3% to $35.7 million[9]. - Total gross profit for the nine months ended September 30, 2025, was $121,230,000, a 20.4% increase from $100,710,000 in 2024[29]. - Adjusted EBITDA margin for the nine months ended September 30, 2025, was 11.9%, compared to 11.4% in 2024[35]. Expenses and Cash Flow - Selling, general and administrative (SG&A) expenses increased by approximately $4.6 million to $28.3 million, but SG&A as a percentage of revenue decreased to 15.3%[9]. - The company reported net cash from operating activities of $13.3 million, significantly up from $4.9 million in the prior year[6]. - The company reported a net cash provided by operating activities of $17,571,000 for the nine months ended September 30, 2025, compared to $17,494,000 for the same period in 2024[21]. Balance Sheet Highlights - The current ratio as of September 30, 2025, was 1.43x, slightly down from 1.46x at the end of 2024[8]. - Total current assets as of September 30, 2025, were $216,819,000, slightly down from $220,334,000 as of December 31, 2024[19]. - Total assets increased to $409,117,000 as of September 30, 2025, compared to $352,129,000 as of December 31, 2024[19]. - Total liabilities rose to $227,555,000 as of September 30, 2025, from $198,638,000 as of December 31, 2024[19]. - Cash and cash equivalents decreased to $9,818,000 as of September 30, 2025, down from $44,930,000 as of December 31, 2024[19].

Financial Performance - As of September 30, 2025, the Annualized Exit Monthly Recurring Subscriptions (AERR) was $56,100, an increase from $49,039 as of September 30, 2024, representing a growth of approximately 21%[178] - Total revenue for the three months ended September 30, 2025, was $17,497,000, representing a 12% increase from $15,627,000 in the same period of 2024[189] - Total revenue for the nine months ended September 30, 2025, was $50,106,000, a 12% increase from $44,598,000 in the same period of 2024[192] - Net income for the three months ended September 30, 2025, was $1,450,000, compared to $148,000 in the same period of 2024, marking a significant increase[188] - Non-GAAP net income for the three months ended September 30, 2025, was $3,034,000, compared to $1,700,000 in 2024[202] Revenue Breakdown - Software solutions revenue increased by $1,661,000 to $7,521,000 for the three months ended September 30, 2025, while service revenue rose by $616,000[189] - Service revenue for the three months ended September 30, 2025, increased to $8,607,000, representing an 8% increase from $7,953,000 in the same period of 2024[210] - Software solutions revenue increased by 28% to $7,521 million for the three months ended September 30, 2025, compared to $5,860 million in 2024, attributed to higher recurring software license and maintenance subscriptions[237] - Software solutions revenue increased by 31% to $21,364 million for the nine months ended September 30, 2025, compared to $16,331 million in the same period of 2024[246] Expenses and Costs - The company reported an increase in operating expenses of $3,148,000 for the nine months ended September 30, 2025, primarily due to higher salaries and benefits[193] - Cost of service revenue for the three months ended September 30, 2025, rose to $3,664,000, a 10% increase from $3,336,000 in 2024[213] - Selling and marketing expenses for the three months ended September 30, 2025, increased to $3,215,000, an 8% rise from $2,976,000 in 2024[216] - General and administrative expenses decreased to $1,928,000 for the three months ended September 30, 2025, down 15% from $2,278,000 in 2024[218] - Research and development expenses for the three months ended September 30, 2025, were $122,000, a decrease of 9% from $134,000 in 2024[219] Cash Flow and Financial Position - Net cash provided by operating activities increased by 69% to $6,950 million for the nine months ended September 30, 2025, compared to $4,107 million in 2024[259] - Cash and cash equivalents amounted to $28,573 million as of September 30, 2025, compared to $18,193 million as of December 31, 2024[258] - Other income increased significantly by 283% to $398 million for the nine months ended September 30, 2025, compared to $104 million in 2024, mainly from higher interest income[233] Customer Metrics - The Net Monthly Subscription Dollar Retention Rate was 99% for cloud telecommunications services and 102% for software solutions, indicating strong customer retention and growth potential[186] - The company supports over six million end users globally through more than 235 cloud communication platform software subscribers[162] - Remaining Performance Obligations (RPOs) increased by 11%, or $6,030, to $58,993,000 as of September 30, 2025, compared to $52,963,000 in 2024[212] Market and Operational Insights - The cloud telecommunications contracts typically have a term of 36 to 60 months, contributing to the company's recurring revenue model[165] - The company continues to invest in technology and CPaaS offerings to enhance competitiveness and profitability in the market[173] - The cloud telecommunications services include a range of essential and advanced features, providing significant value to customers without requiring capital investments[171] Other Financial Information - The income tax provision for the nine months ended September 30, 2025, was $(135,000), an increase of 35% from $(100,000) in 2024[194] - Basic earnings per share for the three months ended September 30, 2025, was $0.05, compared to $0.01 in the same period of 2024[188] - The company believes exposure to foreign currency fluctuation from operating expenses is immaterial, as costs do not constitute a significant portion of total expenses[273] - Inflation has not had a material effect on the company's business or financial condition, but significant inflationary pressures could harm operations[275]

Revenue Growth - Q3 2025 revenue increased 15% year-over-year to $44.2 million, with Life Sciences Services revenue growing 16% to $24.3 million[5] - Revenue from commercial cell and gene therapies rose 36% year-over-year to $8.3 million, contributing to the overall revenue growth[3] - Life Sciences Products revenue grew 15% year-over-year to $20.0 million, representing 45% of total revenue from continuing operations[22] - Total revenue for Q3 2025 was $44.233 million, a 15.1% increase from $38.317 million in Q3 2024[38] - Life Sciences Services revenue reached $24.258 million, up 15.6% from $20.931 million year-over-year[38] - Life Sciences Products revenue increased to $19.975 million, representing a 15.1% growth compared to $17.386 million in the same quarter last year[38] Financial Performance - The company reported a net loss of $6.943 million for Q3 2025, compared to a net income of $805,000 in Q3 2024[38] - Operating costs and expenses totaled $31.257 million for Q3 2025, slightly up from $30.825 million in Q3 2024[38] - The loss from operations for the nine months ended September 30, 2025, was $26.775 million, a decrease from $108.926 million for the same period in 2024[38] - For the three months ended September 30, 2025, GAAP net income was $(6,943) thousand, compared to $805 thousand for the same period in 2024[45] - Adjusted net income (loss) for the three months ended September 30, 2025, was $(6,696) thousand, compared to $(16,521) thousand in 2024[45] Guidance and Future Outlook - The company updated its full-year 2025 revenue guidance to a range of $170 million to $174 million, reflecting strong year-to-date performance[7] - The company expects to provide updated guidance for full-year 2025 revenue during the upcoming conference call[36] - Anticipated up to 25 possible BLA/MAA filings in 2026, indicating a strong pipeline for future growth[14] Cash and Assets - The company held $421.3 million in cash, cash equivalents, and short-term investments as of September 30, 2025[26] - Current assets totaled $484.84 million, an increase from $457.72 million year-over-year[39] - Cash and cash equivalents were reported at $255.81 million, compared to $334.13 million in the previous year[39] - Total assets amounted to $774.32 million, up from $703.49 million year-over-year[39] - Current liabilities reached $307.49 million, an increase from $256.36 million in the previous year[39] Operational Highlights - Cryoport supported a total of 745 global clinical trials as of September 30, 2025, a net increase of 54 trials from the previous year[10] - The company launched next-generation dry vapor shippers with integrated condition monitoring solutions, enhancing its product offerings[4] - Cryoport is focusing on expanding its global supply chain centers and enhancing its strategic partnership with DHL[36] - The company is actively developing new products and services to meet the growing demands of the life sciences sector[36] Cost Management - Total GAAP operating costs and expenses for the three months ended September 30, 2025, were $31,257 thousand, slightly up from $30,825 thousand in 2024[44] - Non-GAAP adjusted operating costs and expenses for the nine months ended September 30, 2025, were $88,118 thousand, down from $159,089 thousand in 2024[44] - Stock-based compensation expense for the three months ended September 30, 2025, was $2,526 thousand, down from $4,056 thousand in 2024[46] Impairments and Losses - The company reported an impairment loss of $(63,809) thousand for the nine months ended September 30, 2024[45] - The company incurred acquisition and integration costs of $69 thousand for the nine months ended September 30, 2025[46] - The company experienced a foreign currency gain of $2,521 thousand for the nine months ended September 30, 2025[46]

Merger and Acquisition - The merger with Sandy Spring Bancorp, Inc. was completed on April 1, 2025, with successful integration of operations by October 14, 2025, leading to increased average balances and net interest income [209]. - The integration of Sandy Spring is expected to yield strategic gains and cost savings, although realization of these benefits is subject to various risks [194]. - The company recorded preliminary goodwill of $512.3 million related to the Sandy Spring acquisition as of September 30, 2025 [219]. - The company paid down $116.1 million in brokered deposits in Q3 2025, with total brokered deposits decreasing to $1.0 billion from $1.2 billion at December 31, 2024 [319]. - The company recorded $89.5 million of Day 1 initial provision expense on non-PCD loans acquired from Sandy Spring in Q2 2025 [312]. - Preliminary goodwill associated with the Sandy Spring acquisition totaled $512.3 million at September 30, 2025 [257]. Financial Performance - Net income available to common shareholders for Q3 2025 was $89.2 million, with basic and diluted EPS of $0.63, compared to $73.4 million and $0.82 in Q3 2024 [218]. - For the first nine months of 2025, net income available to common shareholders was $152.8 million, with basic and diluted EPS of $1.23 and $1.22, respectively, compared to $142.4 million and $1.68 in the same period of 2024 [218]. - Adjusted operating earnings for the first nine months of 2025 were $306.4 million, with adjusted diluted operating EPS of $2.46, compared to $191.4 million and $2.25 in the same period of 2024 [218]. - Adjusted operating earnings (non-GAAP) for Q3 2025 were $122,693,000, up from $77,497,000 in Q3 2024, reflecting enhanced operational performance [333]. - Total revenue (FTE) (non-GAAP) for the first nine months of 2025 reached $999,720,000, up from $610,377,000 in the same period of 2024 [329]. Assets and Deposits - Total assets increased to $37.1 billion as of September 30, 2025, up $12.5 billion from December 31, 2024, primarily due to the Sandy Spring acquisition [219]. - Total deposits reached $30.7 billion at September 30, 2025, an increase of $10.3 billion from December 31, 2024, with quarterly average deposits up 53.8% year-over-year [219]. - Total liabilities were $32.2 billion, an increase of $10.7 billion from December 31, 2024, primarily due to growth in deposits from the Sandy Spring acquisition [262]. - Stockholders' equity increased to $4.9 billion, up $1.8 billion from December 31, 2024, mainly due to the issuance of common stock related to the Sandy Spring acquisition [265]. Interest Income and Margin - Net interest income for Q3 2025 was $319.2 million, an increase of $136.3 million from Q3 2024, driven by a $11.6 billion increase in average interest-earning assets [220]. - The net interest margin increased by 46 basis points to 3.77% in Q3 2025 from 3.31% in Q3 2024, attributed to lower cost of funds and higher net accretion from the Sandy Spring acquisition [222]. - For the first nine months of 2025, net interest income was $824.7 million, an increase of $309.5 million from the same period in 2024 [223]. - The net interest margin increased by 40 basis points to 3.68% for the first nine months of 2025 compared to the same period in 2024 [224]. - The average yield on interest-earning assets increased by 11 basis points to 5.89% for the first nine months of 2025 [223]. Noninterest Income and Expense - Noninterest income rose by $78.79 million or 94.2% to $162.44 million for the nine months ended September 30, 2025, compared to $83.65 million in 2024, primarily due to the Sandy Spring acquisition [238]. - Noninterest expense rose by $115.9 million or 94.5% to $238.4 million for the quarter ended September 30, 2025, compared to $122.6 million for the same quarter in 2024, mainly due to a $38.9 million increase in salaries and benefits and a $33.5 million increase in merger-related costs [240]. - Total noninterest expense for the nine months ended September 30, 2025, increased by $274.5 million or 72.6% to $652.3 million, primarily driven by a $93.8 million increase in salaries and benefits and an $85.6 million increase in merger-related costs [243]. Credit Quality and Allowance for Losses - The allowance for credit losses (ACL) rose to $320.0 million as of September 30, 2025, an increase of $126.3 million from December 31, 2024, primarily due to the Sandy Spring acquisition [302]. - Nonaccrual LHFI increased to $131.2 million at September 30, 2025, up from $58.0 million at December 31, 2024, with NPAs as a percentage of LHFI rising to 0.49% from 0.32% [301]. - The provision for credit losses in Q3 2025 was $16.2 million, up $13.6 million from $2.6 million in Q3 2024, with total provisions for the nine months ended September 30, 2025, reaching $139.6 million, an increase of $107.0 million from $32.6 million in the prior year [311]. Economic Environment and Strategy - The economic environment is being closely monitored, with factors such as inflation, unemployment rates, and market interest rates impacting financial results [210]. - The company emphasizes the importance of liquidity and capital resources in light of potential economic changes and market conditions [192]. - The company is focused on managing growth and implementing its growth strategy amid competitive pressures from fintech companies [194]. - The company is committed to monitoring technological risks and cyber threats as part of its operational strategy [194].

Financial Performance - For the nine months ended September 30, 2025, Innovex reported revenues of $704.6 million, a 72% increase from $410.1 million in the same period of 2024[121] - The net income for the nine months ended September 30, 2025, was $69.3 million, down 36% from $108.5 million in the prior year[121] - Innovex's income from operations for the nine months ended September 30, 2025, was $106.8 million, compared to $22.2 million in the same period of 2024, representing an increase of 382%[121] - Innovex's total costs and expenses for the nine months ended September 30, 2025, were $597.8 million, a 54% increase from $388.0 million in the same period of 2024[121] - Total revenue for the nine months ended September 30, 2025 was $704.6 million, an increase of $294.4 million or 72.2% from the same period in 2024, driven by acquisitions and increased market share[134] - Cost of revenues for the nine months ended September 30, 2025 was $480.5 million, an increase of $218.1 million or 83.1% from the same period in 2024, primarily due to increased personnel expenses and product costs[135] - Selling, general and administrative expenses for the nine months ended September 30, 2025 were $96.8 million, an increase of $18.9 million or 24.3% from the same period in 2024, driven by higher salaries, IT, and R&D costs[136] - Net income for the nine months ended September 30, 2025 was $69.3 million, a decrease of $39.2 million or 36.1% from the same period in 2024, impacted by prior gains on bargain purchases[145] - Adjusted EBITDA for the nine months ended September 30, 2025, was $136.2 million, an increase of $46.8 million or 52% from $89.4 million in the same period of 2024[166] Market Segmentation - The North American market accounted for approximately 53% of total revenue, while international and offshore markets contributed 47%[109] - Innovex's international and offshore market revenue for the three months ended September 30, 2025, was $108.1 million, an increase of 102% from the previous year[123] - The company aims to increase revenue from international and offshore markets, which are less cyclical compared to the North American market[109] Cash Flow and Investments - Net cash provided by operating activities for the nine months ended September 30, 2025 was $138.7 million, an increase of $81.6 million or 143% from the same period in 2024[150] - Net cash used in investing activities for the nine months ended September 30, 2025 was $8.8 million, a decrease of $159.2 million from the previous year, primarily due to acquisitions[151] - Free Cash Flow for the nine months ended September 30, 2025 was $112.5 million, an increase of $61.3 million (120%) from the same period in 2024[170] - The increase in Free Cash Flow indicates improved operational efficiency and cash generation capabilities[170] - The substantial rise in capital expenditures may suggest ongoing investments in growth initiatives[170] Capital Expenditures and Costs - Capital expenditures for the nine months ended September 30, 2025, accounted for 4% of revenue, compared to 1% in the same period of 2024[113] - The company reported a significant increase in depreciation and amortization expenses, which rose by 136% to $45.3 million for the nine months ended September 30, 2025[121] - Capital expenditures rose significantly to $26.2 million, an increase of $20.2 million (339%) from $6.0 million in 2024[170] Acquisitions and Integration - The company acquired Citadel Casing Solutions for $69.7 million in cash on May 30, 2025, enhancing its downhole technology offerings[115] - Acquisition and integration costs for the nine months ended September 30, 2025 were $13.1 million, a decrease of $12.4 million or 48.6% from the same period in 2024[140] - The company incurred acquisition and integration costs of $20.9 million for the twelve months ended September 30, 2025, a decrease of 19% from $25.8 million in 2024[168] Debt and Financing - The company had $12.7 million of borrowings outstanding under the Term Loan as of September 30, 2024, and no borrowings under the revolving credit facility as of September 30, 2025[162] - The company entered into a new Credit Agreement on February 27, 2025, increasing the revolving credit facility from $110 million to $200 million, with a potential increase to $250 million[157] - The company is required to maintain a fixed charge coverage ratio of not less than 1.10 to 1.00 if Excess Availability is less than 20%[160] - The company is subject to various covenants under the Credit Agreement, including limitations on incurring debt and asset sales[160] Other Financial Metrics - As of September 30, 2025, the company had cash and restricted cash of $163.4 million and availability under the Revolver of $132.8 million[146] - Total interest expense for the nine months ended September 30, 2025 was $1.9 million, a slight decrease from $2.1 million in the same period in 2024[141] - Income tax expense for the nine months ended September 30, 2025 was $32.2 million, an increase of $25.3 million or 367.1% from the same period in 2024, due to changes in income mix and non-deductible expenses[144] - The company’s Return on Capital Employed (ROCE) for the twelve months ended September 30, 2025, was 13%, up from 9% for the same period in 2024[168] - The company’s net income as a percentage of revenue was 10% for the nine months ended September 30, 2025, down from 26% in 2024[164] Operational Insights - The company operates in one reportable segment, with performance assessed at a consolidated level[171] - The company continues to focus on financial information at a consolidated level for resource allocation[171] - No significant changes to critical accounting estimates have occurred since the Annual Report[172] - There have been no material changes affecting market risk disclosures since the last Annual Report[175] - Recent accounting pronouncements are discussed in the Summary of Significant Accounting Policies section of the Quarterly Report[173]

Financial Performance - For the nine months ended September 30, 2025, Innovex reported revenues of $704.6 million, a 72% increase from $410.1 million in the same period of 2024[121] - The net income for the nine months ended September 30, 2025, was $69.3 million, a decrease of 36% compared to $108.5 million for the same period in 2024[121] - Innovex's income from operations for the nine months ended September 30, 2025, was approximately $106.8 million, compared to $22.2 million in the same period of 2024, reflecting an increase of 382%[121] - Total revenue for the nine months ended September 30, 2025 was $704.6 million, an increase of $294.4 million or 72.2% from the same period in 2024, driven by acquisitions and increased market share[134] - The company reported a net income decrease of $39.2 million for the three months ended September 30, 2025, compared to $82.6 million for the same period in 2024, representing a 53% decline[156] - The company’s net income as a percentage of revenue decreased to 10% for the nine months ended September 30, 2025, down from 26% in the same period of 2024[164] Market and Revenue Breakdown - The North American market accounted for approximately 53% of total revenue, while international and offshore markets contributed 47% for the nine months ended September 30, 2025[109] - Innovex's revenues from the International and Offshore market for the three months ended September 30, 2025, were $108.1 million, an increase of 102% from the previous year[123] Expenses and Costs - Cost of revenues for the nine months ended September 30, 2025 was $480.5 million, an increase of $218.1 million or 83.1% from the same period in 2024, primarily due to increased personnel expenses and product costs[135] - Selling, general and administrative expenses for the nine months ended September 30, 2025 were $96.8 million, an increase of $18.9 million or 24.3% from the same period in 2024, driven by higher salaries, IT, and R&D costs[136] - Income tax expense for the nine months ended September 30, 2025 was $32.2 million, an increase of $25.3 million or 367.1% from the same period in 2024, due to changes in income mix and non-deductible expenses[144] Cash Flow and Investments - Net cash provided by operating activities for the nine months ended September 30, 2025 was $138.7 million, an increase of $81.6 million or 143% from the same period in 2024[150] - Net cash used in investing activities for the nine months ended September 30, 2025 was $8.8 million, a decrease of $159.2 million from the prior year, primarily due to cash used for acquisitions[151] - Free Cash Flow for the nine months ended September 30, 2025 was $112.5 million, an increase of $61.3 million (120%) from the same period in 2024[170] - Net cash provided by operating activities increased to $138.7 million, up $81.6 million (143%) compared to $57.1 million in 2024[170] Acquisitions and Strategic Initiatives - The company completed the acquisition of Citadel Casing Solutions for $69.7 million on May 30, 2025, enhancing its portfolio of downhole technologies[115] - Innovex's disciplined acquisition strategy aims to identify high-quality opportunities that meet stringent investment criteria, contributing to organic growth[111] - Acquisition and integration costs for the nine months ended September 30, 2025 were $13.1 million, a decrease of $12.4 million or 48.6% from the same period in 2024, due to reduced merger-related expenses[140] Capital Expenditures and Financial Ratios - Capital expenditures for the nine months ended September 30, 2025, accounted for 4% of revenue, compared to 1% in the same period of 2024[113] - The company’s Return on Capital Employed (ROCE) for the twelve months ended September 30, 2025, was 13%, up from 9% in the previous year[168] Debt and Credit Facilities - The company had $12.7 million of borrowings outstanding under the Term Loan as of September 30, 2024, and no borrowings under the revolving credit facility as of September 30, 2025[162] - The revolving credit facility was increased from $110 million to $200 million, with the potential to increase to $250 million, and the maturity extended to February 27, 2030[157] - Total interest expense for the nine months ended September 30, 2025 was $1.9 million, a decrease from $2.1 million in the same period in 2024, reflecting stable debt levels[141] Operational Performance - The company operates in one reportable segment, with performance assessed at a consolidated level[171] - The financial information indicates strong operational performance and cash flow generation capabilities[170] - The increase in Free Cash Flow reflects improved operational efficiency and resource allocation[170] Compliance and Risk Management - The company is required to maintain a fixed charge coverage ratio of not less than 1.10 to 1.00 if Excess Availability is less than 20%[160] - The company is subject to various covenants under the Credit Agreement, including limitations on incurring debt and asset sales[160] - The company continues to monitor market risks and accounting standards to ensure compliance and accuracy[175] - There have been no material changes affecting market risk disclosures from the Annual Report[175] - Recent accounting pronouncements are discussed in the Summary of Significant Accounting Policies[173] - No significant changes to critical accounting estimates have occurred since the Annual Report[172]

Sphere Venues and Experiences - Sphere Entertainment's first venue opened in Las Vegas in September 2023, accommodating up to 20,000 guests and hosting a variety of events year-round[172] - The Sphere Experience features original immersive productions and concerts, supported by Sphere Studios, which includes a 68,000-square-foot development facility[172] - The company is working with DCT Abu Dhabi to establish the world's second Sphere venue in Abu Dhabi, United Arab Emirates[172] - The Sphere's exterior features nearly 580,000 square feet of fully programmable LED paneling, creating the largest LED screen in the world[172] - Sphere opened in Las Vegas in September 2023, with multiple revenue streams expected to generate substantial revenue and adjusted operating income over time[258] - The Company and DCT Abu Dhabi finalized a Franchise Agreement for the construction and operation of Sphere Abu Dhabi, with royalties expected from the use of Sphere's intellectual property[259] - The Company plans to explore additional domestic and international markets for future Sphere venues, utilizing options such as joint ventures and equity partners[260] MSG Networks Operations and Performance - MSG Networks operates two regional sports and entertainment networks and a direct-to-consumer streaming product, MSG+, serving the New York designated market area[173] - MSG Networks' performance is tied to the number of subscribers and the terms of its media rights agreements[178] - MSG Networks reported revenues of $262,511 for Q3 2025, a 15% increase from $227,913 in Q3 2024[195] - The company experienced a net loss of $101,196 in Q3 2025, a slight improvement from a net loss of $105,283 in Q3 2024, representing a 4% decrease in losses[195] - For the nine months ended September 30, 2025, revenues were $825,762, showing a marginal increase of 0% compared to $822,638 in the same period of 2024[195] - MSG Networks experienced a subscriber decline of approximately 13.5% for the three months ended September 30, 2025, impacting distribution revenue[243] - MSG Networks introduced MSG+, a DTC streaming product, which is expected to influence future revenue streams positively[241] Financial Performance and Adjustments - The company recognized impairments and other losses of $65,457 in Q3 2025, primarily due to a $65,400 goodwill impairment charge for the MSG Networks reporting unit[199] - Restructuring charges for Q3 2025 totaled $5,993, compared to $913 in Q3 2024, indicating an increase in restructuring activities[200] - Selling, general and administrative expenses decreased by 16% in Q3 2025, amounting to $99,692 compared to $118,977 in Q3 2024[195] - Adjusted operating income for the three months ended September 30, 2025, increased by $46,558 to $36,364, while for the nine months ended September 30, 2025, it increased by $56,814 to $133,798[212] - The effective tax rate for the three months ended September 30, 2025, was 26%, reflecting an income tax benefit related to state and local taxes[207] - The company recognized cancellation of debt income (CODI) of approximately $614 million on June 27, 2025, which was excluded from taxable income under insolvency provisions[206] - The company reported a net income of $31,334 for the current year period, a significant improvement from a net loss of $199,109 in the prior year period[285] Debt and Cash Management - MSG Networks has entered into a Transaction Support Agreement for debt restructuring, which was consummated on June 27, 2025[180] - Interest income for the three and nine months ended September 30, 2025, decreased by $4,302 and $11,723, respectively, due to lower average cash and cash equivalent balances[202] - Interest expense for the three and nine months ended September 30, 2025, decreased by $17,575 and $19,547, respectively, primarily due to a reduction in the average outstanding principal balance of the MSGN Term Loan Facility[203] - As of September 30, 2025, the Company's unrestricted cash and cash equivalents balance was $384,835, compared to $355,661 as of June 30, 2025[253] - The outstanding balance under the MSGN Term Loan Facility was $200,000 as of September 30, 2025, with a principal amount of $210,000 maturing on December 31, 2029[264] - The interest rate on the MSGN Term Loan Facility as of September 30, 2025, was 9.27%[266] - MSGN L.P. is required to maintain a minimum liquidity level of $50,000, with $25,000 required to be held in cash or cash equivalents[275] - The company experienced a net decrease in cash, cash equivalents, and restricted cash of $117,379 for the nine months ended September 30, 2025[281] - Net cash used in financing activities increased by $120,216 for the nine months ended September 30, 2025, primarily due to a $56,943 increase in principal repayments of debt[287] Market Risks and Currency Fluctuations - The Company continues to monitor the performance and fair value of its MSG Networks reporting unit closely[298] - The Company is exposed to market risk from foreign currency fluctuations primarily related to activities in the UK and Germany[301] - A hypothetical 200 basis point increase in floating interest rates would increase the Company's interest payments by $12,476[300] - The GBP/USD exchange rate fluctuated between 1.2181 and 1.3749, with a 10% fluctuation resulting in a change of approximately $200 in the Company's net asset value[302] - The EUR/USD exchange rate fluctuated between 1.0247 and 1.1868, with a 10% fluctuation resulting in a change of approximately $10 in the Company's net asset value[303] - The Company may consider entering into foreign currency forward exchange contracts to reduce translation risk from foreign currency fluctuations[304] - The Company does not plan to enter into derivative financial instrument transactions for foreign currency speculative purposes[305]

Investment Securities - For the three months ended September 30, 2025, total investment securities increased to $10,511.648 million, up from $8,603.269 million[304]. - The company acquired $1,856.142 million in new investment securities during the quarter, while repayments totaled $516.156 million[304]. - The fair value of Agency RMBS and TBAs rose to $6,658.646 million, reflecting an increase of $1,718.683 million[304]. - The company reported a total of $158.791 million in consolidated SLST investment securities as of September 30, 2025[305]. - As of September 30, 2025, total investments amounted to $10,518,504, an increase from $7,392,338 as of December 31, 2024, representing a growth of approximately 42.8%[337][338]. - The company had $6.1 billion outstanding under repurchase agreements as of September 30, 2025, with a weighted average interest rate of 4.43%[404][405]. - The fair value of investment securities pledged as collateral under repurchase agreements was $6.3 billion as of September 30, 2025, compared to $3.7 billion as of December 31, 2024[402]. - The total unrealized gains on investment securities were $111.4 million as of September 30, 2025, compared to $23.9 million as of December 31, 2024[401]. - The carrying value of Agency RMBS and TBAs increased to $8.01 billion as of September 30, 2025, compared to $4.24 billion as of December 31, 2024, indicating significant growth in this segment[400][401]. - The weighted average yield for total investment securities was 5.86% as of September 30, 2025, up from 5.94% as of December 31, 2024[401][405]. Financial Performance - Net income attributable to common stockholders for Q3 2025 was $32.7 million, or $0.36 per share, with Earnings Available for Distribution (EAD) increasing 9% quarter-over-quarter to $0.24 per share, marking a 140% year-over-year improvement[311]. - The company achieved a quarterly economic return of 3.51% on GAAP book value per share and 3.41% on adjusted book value per share[311]. - The company reported a net income attributable to common stockholders of $32,702 for the three months ended September 30, 2025, slightly up from $32,410 in 2024, while for the nine months, it was $59,501, down from $121,458 in 2024[342]. - The company reported a comprehensive income attributable to common stockholders of $59.5 million for the nine months ended September 30, 2025, compared to a loss of $61.9 million in 2024[363]. - The economic return on book value for the nine months ended September 30, 2025, was 5.93%[333]. - The Company’s recourse leverage ratio as of September 30, 2025, was 5.0x, an increase from 3.0x as of December 31, 2024[338]. - The Company declared a quarterly dividend of $0.23 per share, a 15% increase from the prior quarter, equating to a 13.2% annualized dividend yield as of September 30, 2025[311]. - The Company increased its common stock dividend to $0.23 per share in September 2025[334]. Loan Performance - Residential loans at fair value decreased slightly to $2,969.048 million from $2,826.644 million[304]. - The fair value of residential loans held for sale was reported at $105.036 million[304]. - Constructive originated approximately $1.8 billion of loans over the twelve months ended September 30, 2025, including $439.3 million in Q3 2025, a 9% increase from the prior quarter[313]. - The current fair value of residential loans backing first loss subordinated securities is $1,182,599,000, up from $965,672,000 as of December 31, 2024, representing a 22.5% increase[419]. - The current unpaid principal balance of these loans increased to $1,329,199,000 from $1,111,633,000, reflecting a growth of 19.6%[419]. - The number of loans backing these securities rose to 8,763 from 7,246, indicating an increase of 20.9%[419]. - The delinquency status showed that 94.7% of residential loans were current as of September 30, 2025, an increase from 91.2% as of December 31, 2024[415]. Expenses and Liabilities - The Company incurred general and administrative expenses of $23,349 for the three months ended September 30, 2025, up from $11,941 in 2024, reflecting a 95.5% increase[342]. - Total liabilities as of September 30, 2025, were $6,511,835, which includes repurchase agreements and warehouse facilities totaling $6,363,494[337][338]. - The Company’s preferred stock dividends for the nine months ended September 30, 2025, were $(36,021), compared to $(31,317) in 2024, indicating an increase in dividend payments[342]. - Total expenses related to real estate decreased by $16.416 million to $22.982 million for the three months ended September 30, 2025, from $39.398 million in 2024[344]. Market Conditions - The U.S. GDP grew at an annualized rate of 3.9% in Q3 2025, continuing the growth trend from Q2 2025[321]. - The unemployment rate trended up slightly to 4.3% at the end of August 2025, indicating a cooling labor market[322]. - Effective rents for professionally managed apartments fell 0.3% in Q3 2025, indicating a potential decline in rental housing fundamentals[326]. - The median existing-home sales price in August 2025 was $422,600, up 2.0% from $414,200 in August 2024, marking 26 consecutive months of year-over-year price increases[326]. - Total housing inventory as of the end of August 2025 was up 11.7% year-over-year, indicating potential moderation in the residential real estate market[326]. Strategic Initiatives - The company is focused on reallocating capital away from joint venture equity investments in multi-family properties to targeted assets[306]. - The company executed a strategic repositioning by disposing of certain joint venture equity investments and acquiring assets to expand interest income levels, including Agency RMBS and business purpose loans[382]. - The Company has repositioned its business by reallocating capital from joint venture equity investments in multi-family properties to targeted assets[436]. - The Company sold its equity interests in two joint venture entities during the three months ended September 30, 2025, with a fair value of $1,338,000 as of December 31, 2024[443]. Debt and Financing - The Company completed the issuance of $115 million in Senior Notes due 2030, resulting in net proceeds of approximately $111.4 million after expenses[334]. - The Company issued $90.0 million in aggregate principal amount of its 9.875% Senior Notes due 2030 on July 8, 2025, and an additional $25.0 million on August 22, 2025[452]. - The Company approved a $100.0 million preferred stock repurchase program, with $97.6 million remaining available as of September 30, 2025[486]. - The common stock repurchase program was increased to $246.0 million, with $188.2 million remaining available as of September 30, 2025[487]. - The Company’s debt as of September 30, 2025, includes senior unsecured notes and subordinated debentures, with trust preferred securities outstanding of $45.0 million at a weighted average interest rate of 8.24%[456]. Cash Flow - Net cash flows from operating activities totaled $72.0 million for the nine months ended September 30, 2025[466]. - Net cash flows used in investing activities were $2.7 billion, primarily due to purchases of investment securities and residential loans[467]. - Net cash flows provided by financing activities amounted to $2.6 billion, mainly from repurchase agreements and issuance of CDOs[470]. - The company had an aggregate amount at risk under repurchase agreements of approximately $93.5 million as of September 30, 2025[472].

Investment Securities - For the three months ended September 30, 2025, total investment securities increased to $10,511.648 million, up from $8,603.269 million[304]. - The company acquired $1,856.142 million in new investment securities during the quarter, while repayments totaled $516.156 million[304]. - The fair value of Agency RMBS and TBAs rose to $6,658.646 million, reflecting an increase of $1,718.683 million during the quarter[304]. - The company reported a total of $158.791 million in consolidated SLST investment securities as of September 30, 2025[305]. - As of September 30, 2025, the total investment securities amounted to $8.9 billion, with a fair value of $7.03 billion, reflecting an increase from $5.67 billion as of December 31, 2024[400][401]. - The carrying value of Agency RMBS and TBAs was $8.01 billion, with a fair value of $6.66 billion, showing a weighted average yield of 5.78%[400][402]. - The fair value of investment securities pledged as collateral under repurchase agreements was $6.3 billion as of September 30, 2025, compared to $3.7 billion as of December 31, 2024[402]. - The total unrealized gains on investment securities were $111.4 million, while unrealized losses amounted to $57.7 million[400][401]. Financial Performance - Net income attributable to common stockholders for Q3 2025 was $32.7 million, or $0.36 per share, with Earnings Available for Distribution (EAD) increasing 9% quarter-over-quarter to $0.24 per share, marking a 140% year-over-year improvement[311]. - The company achieved a quarterly economic return of 3.51% on GAAP book value per share and 3.41% on adjusted book value per share[311]. - The company reported a net interest income of $36,586,000 for Q3 2025, with a net interest spread of 1.50%[333]. - Total net interest income for the three months ended September 30, 2025, was $36,586, compared to $20,237 in 2024, reflecting an increase of 80.5%[342]. - The company reported a net income attributable to common stockholders of $32.7 million for the three months ended September 30, 2025, compared to $32.4 million in 2024, reflecting a slight increase[363]. - The company reported a basic earnings per common share of $0.36 for the three months ended September 30, 2025, unchanged from the same period in 2024[342]. - The total other income for the nine months ended September 30, 2025, was $71.3 million, an increase from $16.5 million in 2024[365]. Dividends and Stockholder Returns - The company declared a quarterly dividend of $0.23 per share, a 15% increase from the prior quarter, equating to a 13.2% annualized dividend yield as of September 30, 2025[311]. - The company increased its common stock dividend to $0.23 per share in September 2025[334]. - Dividends declared for the three months ended September 30, 2025, were $21,416,000, translating to $0.24 per share[366]. - The common stock repurchase program was increased to $246.0 million, with $188.2 million remaining available as of September 30, 2025[487]. - During the nine months ended September 30, 2025, the Company repurchased 231,200 shares of common stock at an average price of $6.50 per share, totaling approximately $1.5 million[487]. Loans and Financing - Residential loans at fair value decreased slightly to $2,969.048 million from $2,826.644 million[304]. - The company completed two securitizations of residential loans totaling approximately $619.2 million in net proceeds during Q3 2025[314]. - The company acquired approximately $1.8 billion of Agency investments with an average coupon of 5.27% and $525.7 million in residential loans with an average gross coupon of 8.81% during Q3 2025[333]. - The total residential loans, including those held in Consolidated SLST, amounted to $4,256,683 thousand as of September 30, 2025, up from $3,841,738 thousand as of December 31, 2024, representing a growth of 10.8%[412]. - The company had repurchase agreements with a maximum principal amount of $3,225,000,000 as of September 30, 2025, compared to $2,775,000,000 at the end of 2024, a 16.2% increase[422]. - The company had $2.5 billion in carrying value for Company-sponsored residential loan securitization CDOs as of September 30, 2025[479]. Expenses and Losses - The Company incurred general and administrative expenses of $23,349 for the three months ended September 30, 2025, compared to $11,941 in 2024, reflecting an increase of 95.5%[342]. - The net loss from real estate for the three months ended September 30, 2025, improved to $(3,878) from $(7,495) in 2024, a positive change of 48.3%[342]. - The company recognized $5.6 million in net realized losses during the three months ended September 30, 2025, primarily due to losses on foreclosed properties[345]. - The Company recognized net unrealized losses of $50.0 thousand and $132.6 thousand for the three and nine months ended September 30, 2025, respectively, on its non-Agency RMBS re-securitization[410]. - The Company recognized $50.5 million in net realized losses during the nine months ended September 30, 2025, compared to $18.5 million in 2024, primarily related to foreclosed properties[346]. Economic Indicators - The U.S. GDP grew at an annualized rate of 3.9% in Q3 2025, continuing the growth trend from Q2 2025[321]. - The unemployment rate trended up slightly to 4.3% at the end of August 2025, indicating a cooling labor market[322]. - Effective rents for professionally managed apartments fell 0.3% in Q3 2025, indicating a potential decline in rental housing fundamentals[326]. - The average interest rate for a 30-year fixed mortgage was 6.34% as of October 2, 2025, up 0.22% year-over-year, contributing to affordability challenges for home buyers[326]. - The median existing-home sales price in August 2025 was $422,600, up 2.0% from $414,200 in August 2024, marking 26 consecutive months of year-over-year price increases[326]. Strategic Initiatives - The company is focused on reallocating capital away from joint venture equity investments in multi-family properties to targeted assets[306]. - The company executed a strategic repositioning by disposing of certain joint venture equity investments and acquiring assets to expand interest income levels, including Agency RMBS and business purpose loans[382]. - The company plans to maintain a solid position in unrestricted cash while pursuing investments in less price-sensitive assets like Agency RMBS[461]. - The Company intends to focus on longer-term financing arrangements to reduce exposure to fluctuations in collateral repricing[462].

Investment Securities - For the three months ended September 30, 2025, total investment securities increased to $10,511.648 million, up from $8,603.269 million[304]. - The company reported a total of $6,869.358 million in investment securities available for sale and TBAs as of September 30, 2025[304]. - The fair value of consolidated SLST investment securities owned by the company was $158.791 million as of September 30, 2025, down from $160.930 million[305]. - As of September 30, 2025, total investments amounted to $10,518,504, an increase from $7,392,338 as of December 31, 2024, representing a growth of approximately 42.8%[337][338]. - The company had $6.1 billion outstanding under repurchase agreements as of September 30, 2025, with a weighted average interest rate of 4.43%[404][405]. - The total unrealized gains on investment securities were $111.4 million as of September 30, 2025, compared to $23.9 million as of December 31, 2024[401]. - The carrying value of Agency RMBS and TBAs increased to $8.01 billion as of September 30, 2025, compared to $4.24 billion as of December 31, 2024, indicating significant growth in this segment[400][401]. Financial Performance - Net income attributable to common stockholders for Q3 2025 was $32.7 million, or $0.36 per share, with Earnings Available for Distribution (EAD) increasing 9% quarter-over-quarter to $0.24 per share, marking a 140% year-over-year improvement[311]. - The company achieved the highest level of quarterly investment activity in its history during Q3 2025, reflecting a strategic focus on enhancing recurring income and portfolio liquidity[310]. - The economic return on book value for Q3 2025 was 3.51%, while the economic return on adjusted book value was 3.41%[333]. - The Company reported a net income attributable to common stockholders of $32,702 for the three months ended September 30, 2025, slightly up from $32,410 in 2024, while for the nine months, it decreased to $59,501 from $121,458, a decline of 51.0%[342]. - The Company’s total other income (loss) for the three months ended September 30, 2025, was $48,604, down 8.1% from $52,875 in 2024, while for the nine months, it improved to $71,292 from $(10,527), a significant positive change[342]. Dividends and Stock Repurchases - The company declared a quarterly dividend of $0.23 per share, a 15% increase from the prior quarter, equating to a 13.2% annualized dividend yield as of September 30, 2025[311]. - Common stock repurchases amounted to $1,502,000 for the nine months ended September 30, 2025, with a total of 231,000 shares repurchased[366]. - The Company approved a $100.0 million preferred stock repurchase program, with $97.6 million remaining available as of September 30, 2025[486]. - The common stock repurchase program was increased to $246.0 million, with $188.2 million remaining available as of September 30, 2025[487]. Loan and Mortgage Activity - The company acquired approximately $1.8 billion of Agency investments with an average coupon of 5.27% and approximately $525.7 million in residential loans with an average gross coupon of 8.81% during Q3 2025[333]. - The total value of acquired and originated residential loans as of September 30, 2025, was $4,256,683 thousand, an increase of 10.8% from $3,841,738 thousand as of December 31, 2024[412]. - The business purpose rental loan strategy accounted for 39.5% of the total unpaid principal of acquired and originated residential loans as of September 30, 2025, with an average FICO score of 747 and an average loan-to-value (LTV) ratio of 70%[414]. - The company recognized net unrealized losses of $50.0 thousand and $132.6 thousand for the three and nine months ended September 30, 2025, respectively, on its non-Agency RMBS re-securitization[410]. Risks and Market Conditions - The company faces various risks including changes in interest rates, credit spreads, and the ability to maintain REIT qualification, which could impact future performance[300]. - The Federal Reserve cut the target range for the federal funds rate by 25 basis points in September and another 25 basis points in October 2025, marking the lowest level since 2022[324]. - The U.S. unemployment rate trended up to 4.3% by the end of August 2025, indicating a cooling labor market[322]. - Effective rents for professionally managed apartments fell 0.3% in Q3 2025, indicating a potential decline in rental housing fundamentals[326]. Capital Structure and Financing - The Company Recourse Leverage Ratio and Portfolio Recourse Leverage Ratio increased to 5.0x and 4.7x, respectively, from 3.8x and 3.6x as of June 30, 2025[314]. - The company had repurchase agreements and warehouse facilities totaling $3,225,000,000 as of September 30, 2025, with a weighted average interest rate of 6.37%[422]. - The company incurred loan origination costs of $3.8 million for both the three and nine months ended September 30, 2025[361]. - The company plans to maintain a solid position in unrestricted cash while pursuing investments in less price-sensitive assets like Agency RMBS[461]. Operational Costs - General and administrative expenses for the three months ended September 30, 2025, were $23,349, up 95.4% from $11,941 in 2024, indicating increased operational costs[342]. - Total expenses related to real estate decreased by $16.4 million to $22.98 million for the three months ended September 30, 2025, from $39.4 million in 2024[344]. - Total financing transaction costs for the three months ended September 30, 2025, were $7.9 million, an increase of $5.6 million compared to $2.4 million in 2024[362]. Strategic Acquisitions - The company completed the acquisition of the outstanding membership interests in Constructive, consolidating it into the financial statements, which included residential loans and mortgage servicing rights[304]. - The acquisition of Constructive was completed on July 15, 2025, resulting in full ownership and a reported $14.1 million in mortgage banking income from origination and sale activity for the quarter[313]. - The company executed a strategic repositioning by disposing of certain joint venture equity investments and acquiring assets to expand interest income levels, including Agency RMBS and business purpose loans[382].