Financial Performance - For the three months ended September 30, 2025, total revenue decreased by 3% to $12.4 million, with streaming and digital revenue declining by 5% to $9.6 million [146]. - The company experienced a 39% increase in base distribution revenue for the three months ended September 30, 2025, totaling $1.8 million, primarily due to theatrical releases [146]. - For the six months ended September 30, 2025, total revenue increased by 7% to $23.5 million, with streaming and digital revenue rising by 5% to $18.7 million [154]. - The company reported a net loss attributable to common stockholders of $9.3 million for the three months ended September 30, 2025 [139]. - The company reported a net loss of $9.1 million for the six months ended September 30, 2025, compared to a net loss of $4.3 million in 2024 [165]. - Adjusted EBITDA for the six months ended September 30, 2025, was a loss of $5.8 million, compared to a loss of $0.9 million in the same period of 2024 [165]. Expenses - Direct operating expenses decreased by 17% to $5.2 million for the three months ended September 30, 2025, driven by lower variable costs [150]. - Selling, general and administrative expenses increased by 79% to $11.4 million for the three months ended September 30, 2025, largely due to higher compensation and marketing expenses [151]. - For the six months ended September 30, 2025, total Selling, General and Administrative expenses increased by $7.4 million, or 57%, compared to the same period in 2024, reaching $20.4 million [157]. - Compensation expenses rose by $2.6 million, or 31%, primarily due to an increase in employee headcount [157]. - Marketing expenses surged by $3.3 million, or 7427%, largely attributed to the promotion of Toxic Avenger [157]. - Interest expense decreased by $0.2 million to $0.1 million for the three months ended September 30, 2025, due to a lower average balance on the Line of Credit Facility [153]. - Interest expense decreased by $0.9 million for the six months ended September 30, 2025, primarily due to higher outstanding debt balances and increased interest rates in 2024 [160]. - Amortization of intangible assets increased by $0.5 million, or 31%, during the six months ended September 30, 2025, primarily due to higher capitalized content costs [159]. Cash Flow and Financing - Net cash used in operating activities for the six months ended September 30, 2025, was $21.7 million, compared to $2.4 million in 2024 [166]. - Net cash provided by financing activities increased to $11.0 million for the six months ended September 30, 2025, from $0.5 million in 2024 [166]. - The company has a Line of Credit Facility with East West Bank, allowing borrowings of up to $12.5 million, with $6.6 million outstanding as of September 30, 2025 [140]. - The company plans to continue investing in content development and acquisitions, with short-term content advances of $5.4 million as of September 30, 2025 [141]. Accumulated Deficit and Working Capital - As of September 30, 2025, the company reported an accumulated deficit of $510.2 million and negative working capital of $1.3 million [139].
Cineverse (CNVS) - 2026 Q2 - Quarterly Report