Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

Management's Discussion and Analysis ofFinancial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with the condensed consolidated financial statements and related notes and schedules included elsewhere in this report. Amounts included in the following discussion, except for theaters, screens, average screens, average ticket price and concessions revenue per patron, are rounded in millions.

We are a leader in the theatrical exhibition industry, with theaters in the U.S., Brazil, Argentina, Chile, Colombia, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama, Guatemala, Bolivia, and Paraguay. As of September 30, 2025, we managed our business under two reportable segments - U.S. markets and international markets. See Note 15 to the condensed consolidated financial statements.

The success of the theatrical exhibition industry is contingent upon several key factors, including the volume of new film content available, which is continuing to recover from the effects of the COVID-19 pandemic and most recently the writers' and actors' guilds strikes (the "Hollywood strikes"), as well as the box office performance of new film content released, the duration of the exclusive theatrical release window, and evolving consumer behavior with competition from other forms of in-and-out-of-home entertainment.

Revenue and Expense

We generate revenue primarily from filmed entertainment box office receipts and concession sales, with additional revenue from screen advertising, screen rental and other revenue streams, such as transactional fees, studio trailer placements, meeting rentals, electronic video games and other games located in some of our facilities. Filmed entertainment box office receipts include traditional content from studios as well as alternative entertainment, such as foreign and faith-based films, concert events and other special events in our theaters. NCM provides our domestic theaters with various forms of in-theater advertising. Our Flix Media subsidiaries provide screen advertising and alternative content for our international circuit and for other international exhibitors.

Films leading the box office during the nine months ended September 30, 2025 included new releasesA Minecraft Movie, Lilo & Stitch, Superman, Jurassic World: Rebirth, andSinners.

Film rental costs are variable in nature and fluctuate with our admissions revenue. Film rental costs as a percentage of revenue are generally higher for periods in which more blockbuster films are released. Advertising costs, which are expensed as incurred, are primarily related to expanding our customer base, increasing the frequency of visits and growing loyalty. These expenses vary depending on the timing and length of such campaigns.

Concession supplies expense is variable in nature and fluctuates with our concession revenue and also product mix. Inflationary pressures and tariffs continue to impact product costs in the near term and may impact product costs going forward. We source products from a variety of partners around the world to minimize supply chain interruptions and manage costs, wherever possible.

Although salaries and wages include a fixed cost component (i.e., the minimum staffing costs to operate a theater facility during non-peak periods), salaries and wages tend to move in relation to anticipated changes in attendance. Staffing levels may vary based on the amenities offered at each location, such as full-service restaurants, bars or expanded food and beverage options. In certain international locations, staffing levels are also subject to local regulations, including minimum hour requirements. Labor market conditions and inflationary pressures have driven increases in wage rates and benefits across our labor base and similar increases may continue in the future.

Facility lease expense is primarily a fixed cost at the theater level as most of our facility leases require a fixed monthly minimum rent payment. Certain leases are subject to percentage rent only, while others are subject to percentage rent in addition to their fixed monthly rent if a target annual performance level is achieved. Facility lease expense as a percentage of revenue is also affected by the number of theaters under operating leases, the number of theaters under finance leases and the number of owned theaters.

Utilities and other costs include both fixed and variable costs and primarily consist of utilities, property taxes, property insurance, janitorial costs, credit card fees, third party ticket sales commissions, gift card commissions, repairs and maintenance expenses, security services, and projection and sound equipment maintenance expenses.

General and administrative expenses to support the overall management of the Company are primarily fixed in nature. Fixed expenses include salaries, wages and benefits costs for our corporate office personnel, facility expenses for our corporate and other offices, software license and maintenance costs and audit fees. General and administrative expenses also include some variable expenses such as incentive compensation, consulting and legal fees, general supplies, and other costs that are not specifically associated with the operations of our theaters.

Recent Developments

On October 30, 2025, Holdings' Board of Directors approved a share repurchase program. Under the share repurchase program, Holdings is authorized to repurchase up to $300 million of its outstanding stock, before direct costs associated with the share repurchases.

On November 4, 2025, Holdings' Board of Directors approved an increase to the annual cash dividend from $0.32 to $0.36 per share of common stock per annum, or $0.09 per quarter, effective for our next quarterly dividend payment. The next quarterly dividend will be payable on December 12, 2025 to shareholders of record as of November 28, 2025.

Results of Operations

The following table sets forth, for the periods indicated, the amounts for certain items reflected in the operating income of Holdings along with each of those items as a percentage of revenue.

Three months ended September 30, 2025 (the "third quarter of 2025") versus the three months ended September 30, 2024 (the "third quarter of 2024")

Third quarter of 2025 - The North American Industry box office was approximately $2.5 billion during the third quarter of 2025 which included new releasesSuperman, Jurassic World: Rebirth, The Fantastic Four: First Steps, The Conjuring: Last Rites, andWeapons.

Third quarter of 2024 - The North American Industry box office was approximately $2.7 billion during the third quarter of 2024, which included new releasesDeadpool & Wolverine, Despicable Me 4, Twisters, Beetlejuice Beetlejuice, and the carryover ofInside Out 2.

Revenue. The table below, presented by reportable segment, summarizes our year-over-year revenue performance and certain key performance indicators that impact our revenue.

Cost of Operations. The table below, presented by reportable segment, summarizes our year-over-year theater operating costs.

Salaries and wages decreased 2.6% to $88.7 million for the third quarter of 2025 compared with $91.1 million for the third quarter of 2024 due to lower attendance, reduced operating hours and the favorable impact of labor productivity initiatives, partially offset by wages and benefits inflation. Facility lease expense decreased 3.9% to $61.0 million driven by lower percentage rent. Utilities and other costs increased 1.7% to $99.0 million, primarily driven by higher electricity, repairs and maintenance, and gift card costs.

Film rentals and advertising costs increased to 51.8% of admissions revenue as reported for the third quarter of 2025 compared with 50.8% for the third quarter of 2024 due to the overall mix of films and increased marketing spend. Concession supplies expense remained relatively flat at 22.6% of concessions revenue as reported for the third quarter of 2025 compared with 22.5% for the third quarter of 2024.

Salaries and wages, facility lease expense and utilities and other expenses, as reported, for the third quarter of 2025 benefited from favorable exchange rate fluctuations. In constant currency, salaries and wages increased slightly to $18.9 million for the third quarter of 2025 primarily driven by wages and benefits inflation, mostly offset by effective labor management. Facility lease expense decreased 1.8% to $22.0 million in constant currency for the third quarter of 2025 primarily due to lower percentage rent, partially offset by inflationary increases. Utilities and other costs increased to $30.8 million in constant currency for the third quarter of 2025 due to inflationary pressures.

General and Administrative Expense. General and administrative expense for Holdings increased to $61.9 million for the third quarter of 2025 compared with $56.4 million for the third quarter of 2024. General and administrative expense for CUSA increased to $61.1 million for the third quarter of 2025 compared with $55.5 million for the third quarter of 2024. The increase for both Holdings and CUSA is primarily due to higher share-based compensation, wages and benefits inflation, increased headcount and higher cloud-based software costs, partially offset by the favorable impact of exchange rate fluctuations.

Depreciation and Amortization. Depreciation and amortization expense was $50.9 million for the third quarter of 2025 compared with $49.1 million for the third quarter of 2024.

Impairment of Long-Lived Assets. We recorded an asset impairment charge of $0.6 million during the third quarter of 2025 related to one domestic theater and three international theaters that have underperformed relative to the rest of our theater circuit. We did not record any asset impairment charges during the third quarter of 2024.

Loss (Gain) on Disposal of Assets and Other. A loss on disposal of assets and other of $3.0 million was recorded for the third quarter of 2025 compared with a gain of $0.1 million for the third quarter of 2024. Activity for the third quarter of 2025 was primarily related to the retirement of certain assets that were replaced as a result of theater remodels.

Interest Expense. Interest expense for Holdings, which includes amortization of debt issuance costs and original issue discount and amortization of accumulated losses for swap amendments, was $32.2 million during the third quarter of 2025 compared with $36.7 million during the third quarter of 2024. The interest expense attributable to CUSA was $29.3 million during the third quarter of 2025 compared with $30.6 million during the third quarter of 2024. The decrease in interest expense was primarily due to the payoff of the $460.0 million principal of the 4.50% Convertible Senior Notes on August 15, 2025 and the term loan reprice transactions in November 2024 and June 2025. See further discussion in Liquidity and Capital Resources below.

Interest Income. Interest income for Holdings was $10.1 million during the third quarter of 2025 compared with $14.2 million during the third quarter of 2024. The interest income attributable to CUSA was $9.9 million during the third quarter of 2025 compared with $11.1 million during the third quarter of 2024. The decrease in interest income primarily reflects lower average cash balances as a result of cash used to repay the $460.0 million principal of the 4.50% Convertible Senior Notes and for the cash settlement of the warrants. See further discussion of the Company's long-term debt activity in Note 7 to the condensed consolidated financial statements.

Loss on Debt Amendments and Extinguishments. We recorded a loss on amendment and extinguishment of debt of $3.0 million during the third quarter of 2024 related to the early extinguishment of the 5.875% Senior Notes. We did not have a loss on amendment and extinguishment of debt during the third quarter of 2025.

Loss on Warrants. Holdings recorded a loss on warrants of $54.5 million during the third quarter of 2025 primarily related to the fair value adjustments recorded as a result of the Warrant Early Termination Agreements entered into on August 15, 2025. See further discussion of the warrants in Note 7 to the condensed consolidated financial statements and in Liquidity and Capital Resources below.

Foreign Currency Exchange and Other Related Loss. We recorded a foreign currency exchange loss of $5.2 million during the third quarter of 2025 compared with $3.0 million during the third quarter of 2024. Activity for the third quarter of 2025 and 2024 includes losses of $0.7 million and $0.9 million, respectively, associated with Blue Chip Swap transactions. Excluding the impact of Blue Chip Swap transactions, the loss on foreign exchange is primarily driven by the impact of hyper-inflationary accounting for Argentina, partially offset by currency exchange fluctuations related to US-denominated accounts in certain international countries.

Equity in Income of Affiliates. Equity in income of affiliates of $1.6 million was recorded during the third quarter of 2025 compared with $5.0 million during the third quarter of 2024. Equity in income of affiliates for the third quarter of 2024 reflected higher income earned from our investment in AC JV LLC. See Note 8 to the condensed consolidated financial statements for information about our equity investments.

Net Loss (Gain) on Investment in NCMI. We recorded a net loss on our investment in NCMI of $1.5 million during the third quarter of 2025 compared with a net gain of $11.6 million during the third quarter of 2024, primarily related to the mark-to-market adjustment of our investment in NCMI under the fair value basis of accounting. See Note 8 to the condensed consolidated financial statements for information about our investment in NCMI.

Income Taxes - Holdings. An income tax benefit of $22.9 million was recorded for the third quarter of 2025 compared with an income tax benefit of $42.7 million for the third quarter of 2024. The effective tax rate was approximately (82.8)% for the third quarter of 2025 compared with (29.2)% for the third quarter of 2024. The effective tax rate for the third quarter of 2025 was favorably impacted by changes in valuation allowances previously recorded against federal and certain state interest expense carryforwards. The effective tax rate for the third quarter of 2024 was favorably impacted by changes in valuation allowances previously recorded against certain foreign tax credits, other federal deferred tax assets, certain state net operating losses and other state deferred tax assets. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Income Taxes - CUSA. An income tax expense of $23.8 million was recorded for the third quarter of 2025 compared with an income tax benefit of $39.7 million for the third quarter of 2024. The effective tax rate was approximately 27.8% for the third quarter of 2025 compared with (26.4)% for the third quarter of 2024. The effective tax rate for the third quarter of 2025 differs from the U.S. statutory rate primarily due to foreign tax rate differences, U.S. tax impact of foreign operations, and state and local taxes. The effective tax rate for the third quarter of 2024 was favorably impacted by changes in valuation allowances previously recorded against certain foreign tax credits, other federal deferred tax assets, certain state net operating losses and other state deferred tax assets. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Nine months ended September 30, 2025 (the "2025 period") versus the nine months ended September 30, 2024 (the "2024 period")

2025 Period - The North American Industry box office generated approximately $6.7 billion during the 2025 period, which included new releasesA Minecraft Movie, Lilo & Stitch, Superman, Jurassic World: Rebirth, andSinners.

2024 Period - The North American Industry box office generated approximately $6.4 billion during the 2024 period, which included new releases Inside Out 2, Deadpool & Wolverine, Despicable Me 4, Dune: Part Two, andTwisters.

Revenue. The table below, presented by reportable segment, summarizes our year-over-year revenue performance and certain key performance indicators that impact our revenue.

Cost of Operations. The table below, presented by reportable segment, summarizes our year-over-year theater operating costs.

Salaries and wages increased 4.0% to $254.2 million for the 2025 period compared with $244.4 million for the 2024 period due to wages and benefits inflation, partially offset by labor productivity initiatives. Facility lease expense of $183.4 million was relatively flat compared with the 2024 period. Utilities and other costs increased 8.9% to $278.5 million, primarily driven by increases in credit card fees, real estate taxes, property and liability insurance, repairs and maintenance costs, and utilities.

Film rentals and advertising costs increased to 51.2% of admissions revenue as reported for the 2025 period compared with 50.0% for the 2024 period due to the increased concentration of high-grossing films and increased marketing spend. Concession supplies expense was 22.8% of concessions revenue as reported for the 2025 period compared with 21.9% for the 2024 period. The increase in the concession supplies rate was primarily driven by inflationary pressures and a higher mix of merchandise.

Salaries and wages, facility lease expense and utilities and other expenses, as reported, for the 2025 period benefited from favorable exchange rate fluctuations. In constant currency, salaries and wages increased to $57.3 million for the 2025 period primarily driven by wages and benefits inflation, partially offset by effective labor management. Facility lease expense increased to $64.6 million in constant currency for the 2025 period primarily due to inflationary increases and the dissipation of temporary rent abatements that benefited the 2024 period. Utilities and other costs increased to $88.0 million in constant currency for the 2025 period due to inflationary pressures and higher screen advertising related commissions.

General and Administrative Expense. General and administrative expense for Holdings increased to $170.5 million for the 2025 period compared with $161.0 million for the 2024 period. General and administrative expense for CUSA increased to $167.9 million for the 2025 period compared with $158.2 million for the 2024 period. The increase for both Holdings and CUSA is primarily due to higher share-based compensation, wages and benefits inflation, increased headcount, and higher professional fees and cloud-based software costs, partially offset by the favorable impact of exchange rate fluctuations.

Depreciation and Amortization. Depreciation and amortization expense increased to $149.8 million for the 2025 period compared with $148.3 million for the 2024 period.

Impairment of Long-Lived Assets. We recorded an asset impairment charge of $2.2 million during the 2025 period related to one domestic theater and five international theaters that have underperformed relative to the rest of our theater circuit. We did not record any asset impairment charges during the 2024 period.

(Gain) Loss on Disposal of Assets and Other. A gain on disposal of assets and other of $0.1 million was recorded for the 2025 period compared with a loss of $2.0 million for the 2024 period. Activity for the 2025 period was primarily related to gains on the sale of real estate, offset by the retirement of certain assets replaced as a result of remodels. Activity for the 2024 period was primarily related to the removal and disposal of equipment at closed theaters.

Interest Expense. Interest expense for Holdings, which includes amortization of debt issuance costs and original issue discount and amortization of accumulated losses for swap amendments, was $110.1 million during the 2025 period compared with $109.0 million during the 2024 period. The interest expense attributable to CUSA was $95.1 million during the 2025 period compared with $90.8 million during the 2024 period. The increase in interest expense was primarily due to the impact of the issuance of the 7.00% Senior Notes in July 2024, partially offset by the redemption of the remaining principal amount of the 8.75% Secured Notes during May 2024, the extinguishment of the 5.875% Senior Notes during July 2024, the term loan reprice transactions in May 2024, November 2024, and June 2025, and the payoff of the $460.0 million principal of the 4.50% Convertible Senior Notes on August 15, 2025. See further discussion in Liquidity and Capital Resources below.

Interest Income. Interest income for Holdings was $33.3 million during the 2025 period compared with $40.3 million during the 2024 period. The interest income attributable to CUSA was $30.8 million during both the 2025 and 2024 periods. The decrease in interest income for Holdings primarily reflects lower average cash balances as a result of cash used to repay the $460.0 million principal of the 4.50% Convertible Senior Notes and for the cash settlement of the warrants in the third quarter of 2025, as well as cash used for the repurchase of common stock through the Company's share repurchase program in the first quarter of 2025. See further discussion of the Company's share repurchase program in Liquidity and Capital Resources below.

Loss on Debt Amendments and Extinguishments. We recorded a loss on amendment and extinguishment of debt of $1.5 million during the 2025 period related to the amendment of our term loan, including the write-off of unamortized debt issuance costs and original issue discount, and legal and other fees paid. We recorded a loss on amendment and extinguishment of debt of $5.5 million during the 2024 period related to the amendment of our term loan and the redemption of the remaining 8.75% Secured Notes, and the extinguishment of the 5.875% Senior Notes, including the write-off of unamortized debt issuance costs and original issue discount, and legal and other fees paid. See Note 7 to the condensed consolidated financial statements for information about our loss on debt amendments and extinguishments.

Loss on Warrants. We recorded a loss on warrants of $54.5 million during the 2025 period related to the fair value adjustments recorded as a result of the Warrant Early Termination Agreements entered into on August 15, 2025. See further discussion of the warrants in Note 7 to the condensed consolidated financial statements and in Liquidity and Capital Resources below.

Foreign Currency Exchange and Other Related Loss. We recorded a foreign currency exchange loss of $5.7 million during the 2025 period compared with $7.9 million during the 2024 period. Activity for the 2025 and 2024 periods includes losses of $0.7 million and $0.9 million, respectively, associated with Blue Chip Swap transactions. Excluding the impact of Blue Chip Swap transactions, the loss on foreign exchange is primarily driven by the impact of hyper-inflationary accounting for Argentina, partially offset by currency exchange fluctuations related to US-denominated accounts in certain international countries.

Distributions from NCMI/NCM. We recorded distributions received from NCMI and NCM of $1.6 million during the 2025 period primarily related to a tax receivable agreement with NCM.

Equity in Income of Affiliates. Equity in income of affiliates of $5.1 million was recorded during the 2025 period compared with $11.3 million during the 2024 period. See Note 8 to the condensed consolidated financial statements for information about our equity investments.

Net (Loss) Gain on Investment in NCMI. We recorded a net loss on our investment in NCMI of $9.4 million during the 2025 period compared with a net gain of $12.8 million during the 2024 period, primarily related to the mark-to-market adjustment of our investment in NCMI under the fair value basis of accounting. See Note 8 to the condensed consolidated financial statements for information about our investment in NCMI.

Income Taxes - Holdings. An income tax expense of $4.9 million was recorded for the 2025 period compared with an income tax benefit of $71.3 million for the 2024 period. The effective tax rate was approximately 4.4% for the 2025 period compared with (37.6)% for the 2024 period. During the 2025 period, a deferred tax benefit of $47.7 million was recorded discretely related to the release of valuation allowances previously recorded against federal and certain state interest expense carryforwards. The changes in tax law within the OBBBA related to the business interest expense limitation resulted in sufficient positive evidence to reach a conclusion that valuation allowances related to federal and certain state interest expense carryforwards are no longer required. During the 2024 period, a deferred tax benefit of $116.3 million was recorded discretely related to the release of valuation allowances previously recorded against certain foreign tax credits, other federal deferred tax assets, certain state net operating losses and other state deferred tax assets as well as deferred tax assets in certain foreign jurisdictions. The release of these valuation allowances was the result of the availability of positive evidence related to sustained taxable income in the relevant jurisdictions to support the future realizability of deferred tax assets. These discrete benefits favorably impacted the effective tax rate for the 2025 and 2024 periods, causing the income tax expense and benefit, respectively, to vary significantly from the tax expense derived by applying the statutory tax rate to the pre-tax income for each respective period. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Income Taxes - CUSA. An income tax expense of $53.2 million was recorded for the 2025 period compared with income tax benefit of $67.6 million for the 2024 period. The effective tax rate was approximately 29.4% for the 2025 period compared with (33.7)% for the 2024 period. The effective tax rate for the 2025 period differs from the U.S. statutory rate primarily due to foreign tax rate differences, U.S. tax impact of foreign operations, and state and local taxes. During the 2024 period, a deferred tax benefit of $112.4 million was recorded discretely related to the release of valuation allowances previously recorded against certain foreign tax credits, other federal deferred tax assets, certain state net operating losses and other state deferred tax assets as well as deferred tax assets in certain foreign jurisdictions. The release of these valuation allowances was the result of the availability of positive evidence related to sustained taxable income in the relevant jurisdictions to support the future realizability of deferred tax assets. This discrete benefit favorably impacted the effective tax rate for the 2024 period, causing the income tax benefit to vary significantly from the tax expense derived by applying the statutory tax rate to the pre-tax income for the period. Income tax provisions for interim periods are generally based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.

Income Taxes - Valuation Allowances

The Company assesses the likelihood that it will be able to recover its deferred tax assets against future sources of taxable income and reduces the carrying amounts of deferred tax assets by recording a valuation allowance, if, based on all available evidence, the Company believes it is more likely than not that all or a portion of such assets will not be realized. There is a possibility that within the next 12 months, sufficient positive evidence may become available to reach a conclusion that a portion of the valuation allowance in certain state jurisdictions will no longer be required.

Liquidity and Capital Resources

Operating Activities

We primarily collect our revenue in cash, mainly through box office receipts and the sale of concessions. Our revenue is generally received in cash prior to the payment of related expenses; therefore, we have an operating "float" and historically have not required traditional working capital financing. However, our working capital position will fluctuate based on seasonality, the timing and volume of new film content, the timing of interest payments on our debt as well as timing of payment of other operating expenses that are paid annually or semi-annually, such as property and other taxes and incentive compensation. We believe our existing cash and expected cash flows from operations will be sufficient to meet our working capital, capital expenditures, and known contractual obligations for the next twelve months and beyond.

Cash provided by operating activities was $248.3 million for Holdings and $260.1 million for CUSA for the nine months ended September 30, 2025, compared with cash provided by operating activities of $269.6 million for Holdings and $279.5 million for CUSA for the nine months ended September 30, 2024. The decrease in cash provided by operating activities was primarily driven by the timing of payments to vendors for expenses partially offset by the level of revenue earned during each period.

Investing Activities

Investing activities have been principally related to the development, remodel and enhancement of theaters, which historically have been financed with cash flow from operations and debt financings. Cash used for investing activities was $98.6 million and $89.1 million for the nine months ended September 30, 2025 and 2024, respectively. The increase in cash used for investing activities was primarily due to an increase in capital expenditures, partially offset by the sale of a land parcel and one of our owned theater properties during the nine months ended September 30, 2025.

Below is a summary of capital expenditures, disaggregated by new and existing theaters, for the nine months ended September 30, 2025 and 2024 (in millions):

We operated 497 theaters with 5,644 screens worldwide as of September 30, 2025. Theaters and screens opened and closed during the nine months ended September 30, 2025 were as follows:

As of September 30, 2025, we had the following signed new build and expansion commitments:

Actual expenditures for the continued development of venues and remodels can vary based on such factors as the type of venue, the amenities being built or remodeled within the venue and the timing for completion of a project. Actual expenditures are also subject to change based upon the availability of attractive opportunities and the impact of tariffs. During the next twelve months and the foreseeable future, we plan to fund capital expenditures for our continued development projects with cash flow from operations and, if needed, borrowings under our revolving credit facility, proceeds from debt issuances, sale leaseback transactions and/or sales of excess real estate.

Financing Activities

Cash used for financing activities was $761.8 million for Holdings and $544.1 million for CUSA for the nine months ended September 30, 2025, compared with $94.7 million for Holdings and CUSA for the nine months ended September 30, 2024. The increase in cash used for financing activities for Holdings reflects the repayment of the principal on the 4.50% Convertible Senior Notes, the repurchase of common stock through the Company's share repurchase program, cash paid to settle warrants, the payment of quarterly cash dividends in the first, second and third quarters of 2025, and an increase in restricted stock withholdings for the payment of payroll taxes on equity awards that vested during the period. Cash used for financing activities for CUSA was driven by cash distributions to Cinemark Holdings, Inc. to fund the repayment of the principal on the 4.50% Convertible Senior Notes and the cash settlements of warrants, as well as a portion of the quarterly cash dividend payments, and an increase in restricted stock withholdings for the payment of payroll taxes on equity awards that vested during the period. The cash used for financing activities during the nine months ended September 30, 2024 for both Holdings and CUSA reflected the repayment of the 5.875% Senior Notes and the redemption of the remaining 8.75% secured notes, partially offset by the issuance of the 7.00% Senior Notes.

On March 6, 2025, Holdings' Board of Directors approved a share repurchase program (the "Program"). Under the Program, Holdings was authorized to repurchase up to $200 million of its outstanding stock, before direct costs associated with the share repurchases. This Program commenced on March 11, 2025 and continued until the authorized repurchase amount was reached on March 27, 2025. Repurchases under the Program were funded using cash on hand.

During the first quarter of 2025, Holdings' Board of Directors approved a reinstatement of the Company's dividend at $0.32 per common share per annum, or $0.08 payable quarterly. Holdings, at the discretion of its Board of Directors and subject to applicable law, anticipates paying quarterly cash dividends on its common stock. The amount of the dividends to be paid in the future, if any, will depend upon our then available cash balances, anticipated cash needs, overall financial condition, loan agreement restrictions as discussed below, and future prospects for earnings and cash flows, as well as other relevant factors. The following table summarizes the quarterly dividends paid during the nine months ended September 30, 2025. See Note 6 to the condensed consolidated financial statements for further information about the dividends paid.

On May 15, 2025, as required by the indenture to the 4.50% Convertible Senior Notes, the Company provided irrevocable notice to the holders of the 4.50% Convertible Senior Notes of its election to settle all conversion obligations with respect to any 4.50% Convertible Senior Notes that are converted on or after May 15, 2025 by means of Combination Settlement as defined in the indenture to the 4.50% Convertible Senior Notes. Under the Combination Settlement, the Company repaid the $460.0 million outstanding principal amount of the 4.50% Convertible Senior Notes on their August 15, 2025 maturity date, using cash on hand. Concurrently, on August 15, 2025, the Company issued approximately 16.2 million shares of Holdings' common stock for the $472.0 million owed above the $460.0 million principal amount of the 4.50% Convertible Senior Notes and received an equal and offsetting number of shares from the hedge counterparties. See "4.50% Convertible Senior Notes" below.

On August 15, 2025, Holdings entered into irrevocable warrant unwind and termination agreements with each of the warrant counterparties to unwind the warrant transactions the Company had entered into in connection with the issuance of the 4.50% Convertible Senior Notes (the "Warrant Early Termination Agreements"). Pursuant to the Warrant Early Termination Agreements, the Company will deliver approximately equal amounts of cash and shares of Holdings' common stock to mitigate shareholder dilution. During the period from August 15, 2025 through September 30, 2025, the Company paid approximately $39.2 million in cash and issued 1.4 million shares of Holdings' common stock with a value of approximately $39.2 million to settle a portion of the warrant transactions. Subsequent to September 30, 2025, the Company paid approximately $58.7 million in cash and issued 2.2 million shares of Holdings' common stock with a value of approximately $58.7 million to settle the remaining warrant transactions in accordance with the Warrant Early Termination Agreements, with the final settlement to occur on November 5, 2025. See "4.50% Convertible Senior Notes" below.

We may, from time to time, seek to retire or repurchase our outstanding debt securities through cash purchases or exchanges for other securities, in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on the availability and prices of such debt securities, prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

Contractual Obligations

There have been no material changes in the contractual obligations previously disclosed in "Liquidity and Capital Resources" in the Company's Annual Report on Form 10-K for the year ended December 31, 2024 filed February 19, 2025.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

4.50% Convertible Senior Notes

On August 21, 2020, Holdings issued $460.0 million of 4.50% convertible senior notes (the "4.50% Convertible Senior Notes"). The 4.50% Convertible Senior Notes matured on August 15, 2025. Interest on the notes was payable on February 15 and August 15 of each year.

The initial conversion rate was 69.6767 shares of Holdings' common stock per one thousand dollars principal amount of the 4.50% Convertible Senior Notes. On February 18, 2025, Holdings' Board of Directors declared a cash dividend of $0.32 per common share per annum, $0.08 payable quarterly. As a result of the dividends paid to stockholders on March 19, 2025 and June 12, 2025, the conversion rate was adjusted to 70.0752 shares of Holdings' common stock per one thousand dollars principal amount of the 4.50% Convertible Senior Notes. This adjustment was implemented effective June 17, 2025, which was the first day of the observation period for settlements of conversion of the 4.50% Convertible Senior Notes at maturity.

On May 15, 2025, as required by the indenture to the 4.50% Convertible Senior Notes, the Company provided irrevocable notice to the holders of the 4.50% Convertible Senior Notes of its election to settle all conversion obligations with respect to any 4.50%

Convertible Senior Notes that are converted on or after May 15, 2025 by means of Combination Settlement as defined in the indenture to the 4.50% Convertible Senior Notes. On the August 15, 2025 maturity date of the 4.50% Convertible Senior Notes, the Company settled the $460.0 million outstanding principal amount of the 4.50% Convertible Senior Notes in cash and issued approximately 16.2 million shares of Holdings' common stock to the holders of the 4.50% Convertible Senior Notes for the $472,0 million owed above the $460.0 million principal amount.

Concurrently with the issuance of the 4.50% Convertible Senior Notes, Holdings entered into privately negotiated convertible note hedge transactions (the "hedge transactions"), with one or more of the initial purchasers of the 4.50% Convertible Senior Notes or their respective affiliates (the "option counterparties"). The hedge transactions covered, subject to anti-dilution adjustments substantially similar to those applicable to the 4.50% Convertible Senior Notes, the number of shares of Holdings' common stock that underlied the aggregate amount of the 4.50% Convertible Senior Notes, which gave Holdings the option to purchase approximately 32.0 million shares of its common stock at a price of $14.35 per share, which was adjusted to approximately 32.2 million shares at a price of $14.27 per share as a result of the dividends paid to stockholders on March 19, 2025 and June 12, 2025, as discussed above. The hedge transactions were generally expected to reduce potential dilution to Holdings' common stock upon any conversion of the 4.50% Convertible Senior Notes and/or offset any cash payments we may be required to make in excess of the principal amount of converted 4.50% Convertible Senior Notes. On May 15, 2025, the Company provided notice to the option counterparties of its election to settle the hedges by Net Share Settlement, as defined in the call option confirmations. The Company received from the option counterparties an equal and offsetting number of shares as delivered to the convertible noteholders to settle the amounts owed above the $460.0 million principal amount as discussed above, or 16.2 million shares. The settlement of the hedges occurred on August 15, 2025, concurrent with the maturity of the 4.50% Convertible Senior Notes.

Concurrently with entering into the hedge transactions, Holdings also entered into separate privately negotiated warrant transactions with the option counterparties (the "warrant transactions"), whereby Holdings sold to option counterparties warrants to purchase (subject to the net share settlement provisions set forth therein) up to the same number of shares of Holdings' common stock, subject to customary anti-dilution adjustments (the "warrants"). The warrants could separately have a dilutive effect to the extent that the market value per share of Holdings' common stock exceeds the strike price of the warrants on the applicable expiration dates unless, subject to the terms of the warrants, Holdings elects to cash settle the warrants. The warrants gave the option counterparties the option to purchase approximately 32.0 million shares at a price of $22.08 per share, adjusted to approximately 32.2 million shares at a price of $21.95 per share as a result of the dividends paid to stockholders on March 19, 2025 and June 12, 2025. The economic effect of these transactions was to effectively raise the strike price of the 4.50% Convertible Senior Notes to approximately $21.95 per share of Holdings' common stock. Holdings received $89.4 million in cash proceeds from the warrant transactions, which were used, along with proceeds from the 4.50% Convertible Senior Notes, to pay approximately $142.1 million to enter into the hedge transactions. The cash proceeds from the warrant transactions were recorded as additional paid-in-capital in the Company's Consolidated Statement of Equity.

On August 15, 2025, Holdings entered into Warrant Early Termination Agreements, pursuant to which the Company will deliver cash and shares to each counterparty, the amount of which is determined based upon the volume-weighted average price per share of the Company's common stock during the observation period from August 18, 2025 through November 3, 2025, as specified in the Warrant Early Termination Agreements. Since a portion of the warrants are settled in cash under the Warrant Early Termination Agreements, the warrants were required to be accounted for as a liability, at estimated fair value, effective August 15, 2025. The estimated fair value of the liability was derived using a Monte Carlo simulation model. The estimated fair value of the warrants under the terms of the Warrant Early Termination Agreements exceeded the estimated fair value of the previously existing warrants by $15.1 million, and therefore the Company recognized a loss for that amount on August 15, 2025. During the period from August 15, 2025 through September 30, 2025, the Company paid approximately $39.2 million in cash and issued 1.4 million shares of Holdings' common stock with a value of approximately $39.2 million to settle a portion of the warrant transactions. The estimated fair value of the liability for the remaining warrants at September 30, 2025 was $132.6 million and is reflected in "Liability for warrants" in Holdings' condensed consolidated balance sheet at September 30, 2025. The Company recognized a loss of $39.4 million related to the fair value adjustment of the warrant liability between August 15, 2025 and September 30, 2025. The losses related to the warrants are collectively reflected as "Loss on warrants" in the Company's condensed consolidated statements of income for the three and nine months ended September 30, 2025. Subsequent to September 30, 2025, the Company paid approximately $58.7 million in cash and issued 2.2 million shares of Holdings' common stock with a value of approximately $58.7 million to settle the remaining warrant transactions in accordance with the Warrant Early Termination Agreements, with the final settlement to occur on November 5, 2025.

Senior Secured Credit Facility

On May 26, 2023, CUSA amended and restated its senior secured credit facility (the "Credit Agreement") to provide for an aggregate principal amount of $775.0 million, consisting of a $650.0 million term loan with a maturity date of May 24, 2030 and a $125.0 million revolving credit facility with a maturity date of May 26, 2028. The term loan and revolving credit facility are subject to a springing maturity date of April 15, 2028 if CUSA's 5.25% Senior Notes due 2028 have not been paid or refinanced as required under the Credit Agreement prior to such date, as more specifically described in the Credit Agreement.

On June 30, 2025, CUSA amended and restated its Credit Agreement to reduce the rate at which the term loan bears interest by 0.50% and reset the 101% soft call for another six months (the "2025 Amendment"). See below for additional discussion of interest rates on the term loan, and Note 7 to the condensed consolidated financial statements for additional information on the 2025 Amendment.

On September 5, 2025, CUSA amended and restated its Credit Agreement to increase the revolving credit facility to $225.0 million and to reduce the range of rates at which the revolving credit loans bear interest. In addition, the rate at which CUSA is required to pay a commitment fee on the revolving line of credit now ranges from 0.25% to 0.375%. See below for additional discussion of interest rates on the revolving credit facility, and Note 7 to the condensed consolidated financial statements for additional information on the amendment of the revolving credit facility.

Under the Credit Agreement, quarterly principal payments of $1.6 million are due on the term loan through March 31, 2030, with a final principal payment of the remaining unpaid principal due on May 24, 2030.

Pursuant to the 2025 Amendment noted above, interest on the term loan accrues, at CUSA's option, at either (i) a rate determined by reference to the secured overnight financing rate ("SOFR") as published by CME Group Benchmark Administration Limited and identified by Barclay's Bank PLC (the Administrative Agent) as the forward-looking term rate based on SOFR for a period of 1, 3, or 6 months (depending upon the Interest Period (as defined in the Credit Agreement) chosen by CUSA) (the "Term SOFR Rate"), subject to a floor of 0.50% per annum, plus an applicable margin of 2.25% per annum, or (ii) for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Reserve Bank of New York Rate in effect on such day, plus 1/2 of 1.00% and (c) the Term SOFR Rate for a one month Interest Period, as published two U.S. Government Securities Business Days prior to such day (or if such day is not a U.S. Government Securities Business Day, the immediately preceding U.S. Government Securities Business Day), plus 1.00% (this clause (ii), the "Alternate Base Rate"), subject in the case of this clause (ii) to a floor of 1.50% per annum, plus, in the case of this clause (ii), an applicable margin of 1.25% per annum.

Pursuant to the amendment of the revolving credit facility noted above, interest on revolving credit loans accrues, at CUSA's option, at either (i) the Term SOFR Rate plus an applicable margin that ranges from 1.75% to 2.00% per annum, or (ii) the Alternate Base Rate, subject, in the case of this clause (ii) to a floor of 1.00% per annum, plus, in the case of this clause (ii), an applicable margin that ranges from 0.75% to 1.00%. The applicable margin with respect to revolving credit loans is a function of the Consolidated Net Senior Secured Leverage Ratio as defined in the Credit Agreement. As of September 30, 2025, the applicable margin was 1.75%, however, there were no borrowings outstanding under the revolving line of credit. In addition, CUSA is required to pay a commitment fee on the revolving line of credit that accrues at a rate ranging from 0.25% to 0.375% per annum of the daily unused portion of the revolving line of credit. The commitment fee rate is a function of the Consolidated Net Senior Secured Leverage Ratio and was 0.25% at September 30, 2025.

CUSA's obligations under the Credit Agreement are guaranteed by Holdings and certain subsidiaries of Holdings other than CUSA (the "Other Guarantors") and are secured by security interests in substantially all of Holdings' and the Other Guarantors' personal property.

The Credit Agreement contains usual and customary negative covenants for agreements of this type, including, but not limited to, restrictions on the ability of Holdings, CUSA and their subsidiaries to: merge, consolidate, liquidate, or dissolve; sell, transfer or otherwise dispose of assets; create, incur or permit to exist certain indebtedness and liens; pay dividends, repurchase stock and make other Restricted Payments (as defined in the Credit Agreement); prepay certain indebtedness; make investments; enter into transactions with affiliates; and change the nature of their business. At any time that CUSA has revolving credit loans outstanding, it is not permitted to allow the Consolidated Net Senior Secured Leverage Ratio to exceed 3.5 to 1.0. As of September 30, 2025, there were no revolving credit loans outstanding, and CUSA's Consolidated Net Senior Secured Leverage Ratio was 0.3 to 1.

The Credit Agreement also includes customary events of default, including, among other things, payment default, covenant default, breach of representation or warranty, bankruptcy, cross-default, material ERISA events, a change of control, material money judgments and failure to maintain security interests. If an event of default occurs, all commitments under the Credit Agreement may be terminated and all obligations under the Credit Agreement could be accelerated by the Lenders, causing all loans outstanding (including accrued interest and fees payable thereunder) to be declared immediately due and payable.

The Restricted Payments covenant, as defined in the Credit Agreement generally does not limit the ability of Holdings and its subsidiaries to pay dividends and make other Restricted Payments if the Consolidated Net Total Leverage Ratio (as defined in the Credit Agreement) is less than or equal to 2.75 to 1.00. If the Consolidated Net Total Leverage Ratio is greater than 2.75 to 1.00, but not greater than 5.00 to 1.00, Restricted Payments generally may be made in an aggregate amount not to exceed the Available Amount (as defined in the Credit Agreement), which is a function of CUSA's Consolidated EBITDA minus 1.75 times its Consolidated Interest Expense (as such terms are defined in the Credit Agreement) and certain other factors as specified in the Credit Agreement. As of September 30, 2025, the Consolidated Net Total Leverage Ratio was 2.23 to 1.00 and the Available Amount was $1.2 billion. In addition, the Credit Agreement contains other baskets that allow certain Restricted Payments in excess of the Applicable Amount.

We have three interest rate swap agreements that are used to hedge a portion of the interest rate risk associated with the variable interest rates on the term loan outstanding under the Credit Agreement. See Note 7 to the condensed consolidated financial statements for discussion of the interest rate swaps.

As of September 30, 2025, there was $633.9 million outstanding under the term loan and no borrowings were outstanding under the $225.0 million revolving line of credit. The average interest rate on outstanding term loan borrowings under the Credit Agreement as of September 30, 2025 was approximately 5.7% per annum, after giving effect to the interest rate swap agreements.

7.00% Senior Notes

On July 18, 2024, CUSA issued $500.0 million aggregate principal 7.00% senior unsecured notes, at par (the "7.00% Senior Notes"). The notes will mature on August 1, 2032. Interest on the 7.00% Senior Notes is payable on February 1 and August 1 of each year, beginning on February 1, 2025. CUSA incurred debt issuance costs of approximately $8.7 million in connection with the issuance, which were recorded as a reduction of long-term debt on the Company's consolidated balance sheet. Proceeds, net of fees, were used to repay CUSA's 5.875% $405.0 million aggregate principal amount of Senior Notes due March 2026.

The 7.00% Senior Notes are fully and unconditionally guaranteed on a joint and several senior unsecured basis by certain of CUSA's subsidiaries, or its guarantors, that guarantee, assume or in any other manner become liable with respect to any of CUSA's or its guarantors' other debt. If CUSA cannot make payments on the 7.00% Senior Notes when they are due, CUSA's guarantors must make them instead. The 7.00% Senior Notes and the guarantees are senior unsecured obligations and rank equally in right of payment with all of CUSA's and its guarantor's existing and future senior debt, including the 5.25% senior notes due 2028 and all borrowings under CUSA's Credit Agreement. The notes and the guarantees will be structurally subordinated to all existing and future debt and other liabilities of CUSA's non-guarantor subsidiaries. The notes and the guarantees will be structurally senior to any future debt, if any, issued by Holdings that is not guaranteed by CUSA or any of its subsidiaries.

Prior to August 1, 2027, CUSA has the option to redeem all or a portion of the 7.00% Senior Notes at a price equal to 100.0% of the principal amount thereof, plus accrued and unpaid interest, if any, plus a make-whole premium. In addition, prior to August 1, 2027, CUSA may redeem up to 40% of the aggregate principal amount of the 7.00% Senior Notes with funds in an amount equal to the net proceeds of certain equity offerings at a redemption price equal to 107.0% of the principal amount of the 7.00% Senior Notes redeemed, plus accrued and unpaid interest, if any, as long as (i) at least 60% of the principal amount of the 7.00% Senior Notes outstanding issued under the indenture governing the 7.00% Senior Notes (including any additional notes) remains outstanding immediately after each such redemption and (ii) the redemption occurs within 120 days of the date of the closing of such equity offerings.

CUSA may redeem the 7.00% Senior Notes in whole or in part at any time on or after August 1, 2027 at redemption prices set forth in the indenture governing the 7.00% Senior Notes.

The indenture governing the 7.00% Senior Notes contains covenants that limit, among other things, the ability of CUSA and certain of its subsidiaries to (1) incur or guarantee additional indebtedness, (2) pay dividends or distributions on, or redeem or repurchase, capital stock and make other restricted payments, (3) make certain investments, (4) engage in certain transactions with affiliates, (5) incur or assume certain liens, and (6) consolidate, merge or transfer all or substantially all of its assets. Additionally, upon a change in control, as defined in the indenture governing the 7.00% Senior Notes, CUSA would be required to make an offer to repurchase all of the 7.00% Senior Notes at a price equal to 101% of the aggregate principal amount outstanding plus accrued and unpaid interest, if any, through the date of repurchase.

5.25% Senior Notes

On June 15, 2021, CUSA issued $765.0 million aggregate principal amount of 5.25% senior notes due 2028, at par value (the "5.25% Senior Notes"). Interest on the 5.25% Senior Notes is payable on January 15 and July 15 of each year. The 5.25% Senior Notes mature on July 15, 2028.

The 5.25% Senior Notes are fully and unconditionally guaranteed on a joint and several senior unsecured basis by certain of CUSA's subsidiaries that guarantee, assume or become liable with respect to any of CUSA's or a guarantor's debt. The 5.25% Senior Notes and the guarantees will be CUSA's and the guarantors' senior unsecured obligations and (i) rank equally in right of payment to CUSA's and the guarantors' existing and future senior debt, including borrowings under CUSA's Credit Agreement and CUSA's existing senior notes, (ii) rank senior in right of payment to CUSA's and the guarantors' future subordinated debt, (iii) are effectively subordinated to all of CUSA's and the guarantors' existing and future secured debt, including all obligations under the Credit Agreement, in each case to the extent of the value of the collateral securing such debt, and (iv) are structurally subordinated to all existing and future debt and other liabilities of CUSA's non-guarantor subsidiaries.

CUSA may redeem the 5.25% Senior Notes in whole or in part at redemption prices specified in the indenture.

Covenant Compliance

The indentures governing the 5.25% Senior Notes and the 7.00% Senior Notes ("the indentures") contain covenants that limit, among other things, the ability of CUSA and certain of its subsidiaries to (1) make investments or other restricted payments, including paying dividends, making other distributions or repurchasing subordinated debt or equity, (2) incur additional indebtedness and issue preferred stock, (3) enter into transactions with affiliates, (4) enter new lines of business, (5) merge or consolidate with, or sell all or substantially all of its assets to, another person and (6) create liens. As of September 30, 2025, CUSA could have distributed up to approximately $4.3 billion to its parent company and sole stockholder, Holdings, under the terms of the indentures, subject to its available cash and other borrowing restrictions outlined in the indentures. Upon a change of control, as defined in the indentures, CUSA would be required to make an offer to repurchase the 5.25% Senior Notes and the 7.00% Senior Notes at a price equal to 101% of the aggregate principal amount outstanding plus accrued and unpaid interest, if any, through the date of repurchase. The indentures allow CUSA to incur additional indebtedness if it satisfies the coverage ratio specified in the indenture, after giving effect to the incurrence of

the additional indebtedness, and in certain other circumstances. The required minimum coverage ratio is 2 to 1 and our actual ratio as of September 30, 2025 was 6.9 to 1.

See discussion of dividend restrictions and the net senior secured leverage ratio under the Credit Agreement at Senior Secured Credit Facility above.

As of September 30, 2025, we believe we were in full compliance with all agreements, including all related covenants, governing our outstanding debt.