Angel Studios, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

Angel Studios, Inc.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The financial information presented in these unaudited financial statements is condensed and should be read in conjunction with the entity’s latest annual audited financial statements. Interim disclosures generally do not repeat those in the annual statements.

**1.**Description of Organization and Summary of Significant Accounting Policies

Organization

The company comprises Angel Studios, Inc., a Delaware corporation, and its subsidiaries and affiliates (collectively, the “Company”) (f/k/a Southport Acquisition Corporation or “Southport”). The Company’s mission is to share stories with the world that amplify light. This is done by aligning the Company’s interests with those of the creators and the audience and utilizing the wisdom of crowds to help guide decisions on the content that gets created.

Southport Merger

On September 10, 2025, the Company consummated the previously announced Southport Merger (as defined below) pursuant to that certain Agreement and Plan of Merger, dated as of September 11, 2024 (as amended, the “Merger Agreement”), by and among the Company, Sigma Merger Sub, Inc., a Delaware corporation and direct wholly-owned subsidiary of the Company (“Merger Sub”), and Angel Studios Legacy, Inc. (f/k/a Angel Studios, Inc.), a Delaware corporation (“Angel Legacy”).

Pursuant to the terms of the Merger Agreement, a merger was effected in which Merger Sub merged with and into Angel Legacy, the separate corporate existence of Merger Sub ceased to exist and Angel Legacy survived as the surviving company and direct wholly-owned subsidiary of the Company (the “Merger” and, collectively with the other transactions described in the Merger Agreement, the “Southport Merger”). On the Closing Date (as defined in the Merger Agreement), and prior to the Effective Time (as defined in the Merger Agreement), the Company changed its name from “Southport Acquisition Corporation” to “Angel Studios, Inc.” Angel Legacy subsequently merged up and into Angel Studios, Inc., with Angel Studios, Inc. as the surviving entity.

Notwithstanding the legal form of the Southport Merger pursuant to the Merger Agreement, the Southport Merger has been accounted for as a reverse recapitalization in accordance with United States generally accepted accounting principles (“GAAP”) because Angel Legacy is the operating company and has been determined to be the accounting acquirer, while Southport is a blank check company.

Under the reverse recapitalization model, the Southport Merger was treated as Angel Legacy issuing equity for the net assets of Southport, with no goodwill or intangible assets recorded.

While Southport was the legal acquirer in the Southport Merger, because Angel Legacy was deemed the accounting acquirer, the historical financial statements of Angel Legacy became the historical financial statements of the combined company upon the consummation of the Southport Merger. As a result, the condensed consolidated financial statements reflect (i) the historical operating results of Angel Legacy prior to the Southport Merger; (ii) the combined results of Southport and Angel Legacy following the closing of the Southport Merger; (iii) the assets and liabilities of Angel Legacy at their historical cost; and (iv) the Company’s equity structure for all periods presented.

In accordance with the applicable guidance, the equity structure within these quarterly financial statements has been retroactively restated in all comparative periods up to the closing date, to reflect the number of shares of the Company’s Common Stock (as defined below) issued to Angel Legacy common shareholders. As such, the shares and corresponding capital amounts and earnings per share related to Angel Legacy common stock prior to the Southport Merger have been retroactively restated as shares reflecting the exchange ratio established in the Southport Merger, which is 5.3504621, with all Angel Legacy Class A common stock and Class C common stock being converted to Class A common stock, par value $0.0001 per share (the “Class A Common Stock”) and all Angel Legacy Class B common stock and Class F common stock being converted to Class B common stock, par value $0.0001 per share (the “Class B Common Stock” and, together with the Class A Common Stock, the “Common Stock”).

Basis of Presentation

The condensed consolidated financial statements include the accounts of the Company. All significant intercompany balances and transactions have been eliminated in consolidation.

The unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial information. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of the Company’s management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been reflected in these unaudited condensed consolidated financial statements. Operating results for the three and nine months ended September 30, 2026 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2026. The balance sheet at December 31, 2025 has been derived from the audited financial statements at that date, but does not include all the information and footnotes required by GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements should be read together with the annual audited consolidated financial statements and related notes for the fiscal year ended December 31, 2025 included in the Annual Report on Form 10-K for the year ended December 31, 2025, filed with the Securities and Exchange Commission (the “SEC”) on March 12, 2026.

As comprehensive income equals net income, separate statements of comprehensive income were not included in the accompanying condensed consolidated financial statements.

Reclassifications

Certain prior period balances have been reclassified to conform to the current period presentation in the condensed consolidated financial statements and the accompanying notes.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Estimates are based on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. Regularly, the Company evaluates the assumptions, judgments, and estimates. Actual results may differ from these estimates.

Liquidity

The condensed consolidated financial statements have been prepared assuming the Company will continue to operate as a going concern within one year from the date of issuance of these condensed consolidated financial statements. For the nine months ended September 30, 2026, the Company incurred a net loss of approximately $42.7 million and had cash provided by operating activities of approximately $29.1 million. The Company had an accumulated deficit of approximately $284.3 million as of September 30, 2026.

Management is working to increase revenues through the growth of Angel Guild memberships, the Company’s pipeline of theatrical releases during the final quarter of 2026 and additional streaming agreements. During the nine months ended September 30, 2026, the Company generated approximately $322.7 million in cash from Angel Guild paid memberships. The Company has historically financed marketing activities for theatrical releases through two primary methods: 1) Regulation A offerings that are tailored to raise money for the print and advertising costs (“P&A”) for specific theatrical releases and 2) P&A loan agreements with individual and institutional investors. During the nine months ended September 30, 2026, the Company raised $0.0 million from Regulation A offerings and received $20.0 million from P&A loans. During the year ended December 31, 2025, the Company raised $13.2 million from Regulation A offerings and received $84.0 million from P&A loans. During the nine months ended September 30, 2026, the Company paid $68.7 million for the repayments of P&A loans, including interest and paid $5.9 million as a redemption of shares for Regulation A investors, from the proceeds collected from the theatrical releases and other revenues earned. During the year ended December 31, 2025, the Company paid $43.5 million for the repayments of P&A loans, including interest and paid $15.8 million as a redemption of shares for Regulation A investors, from the proceeds collected from the theatrical releases and other revenues earned.

Additionally, the Company has raised capital through the sale of its Common Stock, generating $104.1 million of cash during the year ended December 31, 2025. The Company issued Common Stock for aggregate proceeds of $34.6 million during the nine months ended September 30, 2026. As the Company continues to grow, management expects that the existing capital resources, including cash, accounts receivables, licensing receivables, recurring revenues from its membership base, the ability to draw on its existing debt facility, and the ability to sell its digital assets if necessary, will be sufficient to meet the Company’s operating requirements for at least the next twelve months. While there is no assurance of success, management remains committed to its plans to grow revenues and manage expenses.

Summary of Significant Accounting Policies

The Company’s significant accounting policies are described in Note 1 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. There have been no material changes to the Company’s significant accounting policies since the date of those financial statements, except as described below.

Goodwill

Goodwill represents the excess of the consideration transferred in a business combination, plus the acquisition-date fair value of any previously held equity interest in the acquiree, over the fair value of the identifiable net assets acquired. Goodwill is not amortized. The Company tests goodwill for impairment annually, and more frequently if events or changes in circumstances indicate that it is more likely than not that the fair value of the reporting unit is less than its carrying amount. The Company has determined that it operates as a single reporting unit. The Company may first assess qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If the Company concludes that it is, or elects to bypass the qualitative assessment, it compares the fair value of the reporting unit with its carrying amount and recognizes an impairment charge for the amount by which the carrying amount exceeds fair value, not to exceed the carrying amount of goodwill. No goodwill impairment was recognized during three and nine months ended September 30, 2026.

Intangible Assets

Intangible assets acquired in business combinations are recorded at their estimated fair values as of the acquisition date. Finite-lived intangible assets consist of acquired tradenames and technology assets and are amortized on a straight-line basis over their estimated useful lives. The Company evaluates finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable, in accordance with its policy for long-lived assets.

Content

The Company capitalizes owned content, whether produced or acquired, as film costs in accordance withASC 926-20, Entertainment-Films-Other Assets-Film Costs. Acquired content is initially recognized at its acquisition-date fair value. Owned content predominantly monetized through the Angel streaming platform is monetized as a film group, together with the Company’s other owned content monetized through the platform. The Company amortizes each film in the film group to cost of revenues based on its watch-time, whereby amortization each period is determined by the ratio of the film’s current-period watch-time to its estimated remaining total watch-time, applied to the film’s unamortized cost. Because this content is monetized as a group, the Company assesses it for impairment at the film-group level, reviewing the film group in aggregate when events or changes in circumstances indicate that the fair value of the film group may be less than its unamortized cost.

Certain owned content is predominantly monetized on its own rather than as part of the film group. The Company amortizes this content to cost of revenues using the individual-film-forecast-computation method, based on the ratio of the content’s current-period revenue to its estimated remaining ultimate revenue, and assesses it for impairment individually when events or changes in circumstances indicate that its fair value may be less than its unamortized cost.

Content is amortized over its estimated period of use, not to exceedten years from the later of the content’s first release or, for acquired content, the acquisition date.

Guarantees of Third-Party Indebtedness

The Company guarantees repayment of certain third-party loans made to independent film production companies. At the inception of each guarantee, the Company recognizes a guarantee liability measured at fair value in accordance with ASC 460, Guarantees, using a probability-weighted present value of expected cash outflows (Level 3 under ASC 820, Fair Value Measurement). The offsetting debit is recorded in other long-term assets, representing the expected economic recovery through revenue generated from the distribution of the film (“Producer Royalty Rights”). The guarantee liability and other long-term assets are reduced pro-rata as Producer Royalty Rights are applied to the outstanding loan balance over the guarantee term, with no income statement impact as long as full recovery is projected. If a shortfall becomes probable and estimable, the Company recognizes guarantee expense for the net unrecoverable amount, writes off the other long-term assets, and recognizes a royalty recoverable asset for the estimated post-term royalty recovery underASC 926-20, Entertainment-Films-Other Assets-Film Costs. SeeNote 6,Commitments and Contingencies, for further information.

Minimum Royalty Guarantees

The Company enters into agreements with certain filmmakers that guarantee minimum royalty payments over a specified term, regardless of the box office, streaming, or other performance of the underlying content (“Minimum Royalty Guarantees”).

Unlike Guarantees of Third-Party Indebtedness discussed above, Minimum Royalty Guarantees do not involve a guarantee of a third party's indebtedness and are not accounted for underASC 460, Guarantees. The Company recognizes royalty expense and a corresponding liability as royalties are earned under the applicable royalty formula, with cash payments reducing the liability. If the Company determines that royalties expected to be earned over the guarantee term will not be sufficient to satisfy the guaranteed minimum, the Company recognizes the estimated shortfall as expense, with a corresponding liability, in the period the shortfall becomes probable and estimable. SeeNote 6,Commitments and Contingencies, for further information regarding amounts outstanding under these arrangements.

Deferred Revenue

Deferred revenue represents payments received in advance of the Company fulfilling its performance obligations under various arrangements, including Angel Guild memberships, content licensing, theatrical ticket presales and other deferred revenue. The Company recognizes deferred revenue when cash is received before the related revenue recognition criteria are met, and such amounts are recognized as revenue when the related performance obligations are satisfied.

Angel Guild Memberships

Angel Guild membership fees, which include multiple membership options, are recorded as deferred revenue when received. As of September 30, 2026 and December 31, 2025, the Company had $97.8 million and $64.8 million, respectively, of deferred revenue related to Angel Guild memberships. These amounts are expected to be recognized as revenue over the membership period and within the next twelve months.

Other Deferred Revenue

As of September 30, 2026 and December 31, 2025, the Company had $0.7 million and $1.7 million, respectively, in deferred revenue from various other types of contractual arrangements. These amounts will be recognized as revenue when the performance obligations are satisfied, primarily within the next twelve months.

As of December 31, 2025, the Company had $66.5 million of total deferred revenue. Of this amount, $12.4 million and $60.1 million were recognized as revenue during the three and nine months ended September 30, 2026.

Revenue Recognition

The Company recognizes revenue when a customer obtains control of promised products or services. The amount of revenue recognized reflects the consideration that the Company expects to be entitled to receive in exchange for these products or services. The Company applies the following five steps: 1) Identify the contract with the customer; 2) Identify the performance obligations in the contract; 3) Determine the transaction price; 4) Allocate the transaction price to performance obligations in the contract; and 5) Recognize revenue when or as the Company satisfies a performance obligation. The following components represent the most significant portions of revenue being recognized:

Angel Guild Revenue

The Angel Guild is a paid membership that gives certain benefits, such as early access to certain content and the ability to vote on future content. Premium memberships receive additional benefits, such as complimentary theatrical tickets and merchandise discounts. Members have the option to pay either on a monthly or annual basis. The payments for memberships are initially recorded as deferred revenue and allocated to three different performance obligations: 1) memberships – recognized on a straight-line basis over the membership period, 2) complimentary theatrical tickets – allocated only in periods of theatrical releases by the Company and recognized as tickets are redeemed during the month of membership and 3) merchandise – recognized as the benefit is used.

Theatrical Release Revenue

Prior to the digital release of licensed content, the Company might provide the option to release content as part of a theatrical release. Revenue from these events is recognized at a point in time – when the theatrical showing takes place. The Company will negotiate the terms of the theatrical distribution window (ranging from a few weeks to a few months), profit sharing percentage, and collection terms with the theater owners prior to the release. Theatrical release revenue fluctuates depending on the timing and scale of theatrical showings.

Content Licensing Revenue

The Company’s content licensing arrangements include fixed fee and minimum guarantee arrangements, and sales or usage based royalties. The Company’s fixed fee or minimum guarantee licensing arrangements may, in some cases, include multiple titles, multiple license periods (windows), rights to exploitation in different media, or rights to exploitation in multiple territories, which may be considered distinct performance obligations. When these performance obligations are considered distinct, the fixed fee or minimum guarantee in the arrangement is allocated to the title, window, media right or territory as applicable, based on estimates of relative standalone selling prices. The amounts related to each performance obligation (i.e., title, window, media or territory) are recognized when the content has been delivered, and the window for the exploitation right in that territory has begun, which is the point in time at which the customer is able to begin to use and benefit from the content.

Sales or usage based royalties represent amounts due to the Company based on the “sale” or “usage” of its content by the customer, and revenues are recognized at the later of when the subsequent sale or usage occurs, or the performance obligation

to which some or all the sales or usage-based royalty has been allocated has been satisfied (or partially satisfied). Generally, when the Company licenses completed content (with standalone functionality, such as a movie, or television show), its performance obligation will be satisfied prior to the sale or usage. The actual amounts due to the Company under these arrangements are typically not reported to the Company until several months after the close of the reporting period. The Company records revenue under these arrangements for the amounts due and not yet reported to the Company based on estimates of the sales or usage of these customers and pursuant to the terms of the contracts. Such estimates are based on information from the Company’s customers, historical experience with similar titles in that market or territory, the performance of the title in other markets and/or available data in the industry. While the Company believes these estimates are reasonable estimates of the amounts due under these arrangements, such estimated amounts could differ from the actual amounts to be subsequently reported by the customer, which could be higher or lower than the Company’s estimates, and could result in an adjustment to revenues in future periods. Any adjustments booked during the three and nine months ended September 30, 2026 and 2025 have been immaterial.

For certain multi-year licensing arrangements, payments may be due over a longer period. When the Company expects the period between fulfillment of its performance obligation and the receipt of payment to be greater than a year, a significant financing component is present. In these cases, such payments are discounted to present value based on a discount rate reflective of a separate financing transaction between the customer and the Company, at contract inception. The Company does not assess contracts with deferred payments for significant financing components if, at contract inception, the Company expects the period between fulfillment of the performance obligation and subsequent payment to be one year or less.

Content licensing arrangements can last between several months and up toten years. The typical period ranges around three years.

Other Revenue

Other revenue consists of merchandise, tickets to Dry Bar Comedy shows and other events, concession sales, general and administrative management fees and in-app advertising. Other revenue is recognized when shipment of the merchandise occurs, the services are performed or when the event takes place.

The Company's remaining performance obligations consist primarily of Angel Guild memberships, for which unrecognized amounts are reflected in deferred revenue above.

The Company does not disclose revenue by geography as it is impracticable to do so. The Company’s business operations involve complex, interconnected revenue streams that are not easily attributable to specific geographic regions. Revenue is often generated through multi-region engagements, global contracts and shared operational resources, making geographic segmentation inaccurate or misleading. As a result, providing such information would not reflect the true nature of the Company’s business and could lead to misinterpretation.

Basic and Diluted Earnings (Loss) Per Share

Basic earnings (loss) per share attributable to the Company is computed by dividing income (loss) attributable to the Company by the weighted-average number of shares outstanding during the period. Diluted earnings (loss) per share attributable to the Company gives effect to all dilutive potential shares that are outstanding during the period (if any) and excludes stock options that are anti-dilutive as a result of any net losses during the period.

Segment Reporting

The Company operates as asingle reportable segment. The Chief Operating Decision Maker (“CODM”), Neal Harmon, the Chief Executive Officer, evaluates the Company’s financial performance and allocates resources based on consolidated financial results. The Company does not manage its operations or prepare financial information on a disaggregated basis beyond the consolidated level for internal reporting purposes.

The CODM reviews consolidated operating results, primarily focusing on revenue, operating income (loss), and key expense categories to assess performance and make strategic decisions. Thesingle reportable segment derives its revenue as described above, primarily from Angel Guild revenue, theatrical release revenue, content licensing, merchandise revenue and other revenue. Segment profit or loss is measured consistently with the consolidated operating income (loss) presented in the condensed consolidated statements of operations.

The significant expense categories regularly provided to the CODM as part of the consolidated financial review include cost of revenue, selling and marketing, research and development, legal and general and administrative expenses. The amounts for these categories are included in the condensed consolidated statements of operations. These expenses represent the primary financial measures used by the CODM to evaluate operational efficiency and resource needs. No other significant expense categories or performance metrics are regularly provided to the CODM on a disaggregated basis.

Recent Accounting Pronouncements

Recently Issued Accounting Pronouncements Not Yet Adopted

ASU 2025-12

In December 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2025-12, Codification Improvements, which addresses stakeholder suggestions through technical corrections, clarifications, and minor improvements across various Codification Topics, applying to all entities within affected guidance. ASU 2025-12 is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2025-12.

ASU 2025-11

In December 2025, the FASB issued ASU 2025-11,Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies the guidance in Topic 270 to improve the consistency of interim financial reporting. The ASU provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2025-11.

ASU 2024-03

In November 2024, the FASB issued ASU 2024-03,Disaggregation of Income Statement Expenses, which improves the disclosures about a public business entity’s expenses and addresses requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, SG&A, and research and development). Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03. The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The amendments should be applied either (1) prospectively to financial statements issued for reporting periods after the effective date or (2) retrospectively to any or all

prior periods presented in the financial statements. The Company will review the guidance in ASU 2024-03 and will adopt disclosures as applicable in the fiscal year ending December 31, 2027.

R**ecently Adopted Accounting Pronouncements

ASU 2025-06

In September 2025, the FASB issued ASU 2025-06, which amends certain aspects of the accounting for and disclosure of software costs under ASC 350-40. The ASU makes targeted improvements to ASC 350-40 but does not fully align the framework for accounting for internally developed software costs that are subject to ASC 350-40 with the framework applied to software to be sold or marketed externally that is subject to ASC 985-20. The ASU also does not amend the guidance on costs of software licenses that are within the scope of ASC 985-20. The amendments supersede the guidance on Web site development costs in ASC 350-50 and relocate that guidance, along with the recognition requirements for development costs specific to Web sites, to ASC 350-40. This ASU becomes effective for annual periods beginning in 2028, including interim periods, with early adoption permitted. The Company has adopted this standard with its annual period beginning on January 1, 2025 and applied it retrospectively. The adoption of this standard required the capitalization of software costs not previously capitalized under the old standard; therefore, it required an adjustment to the Company’s opening accumulated deficit balance as of January 1, 2025 to recognize the cumulative effect of initially applying the change in accounting principle to previous periods. The adjustment subsequently made was a decrease in the accumulated deficit for the year ended December 31, 2024 of $12.9 million. An adjustment to decrease the Company’s net loss was required for the three and nine months ended September 30, 2025 of $0.1 million and$0.2 million, respectively. The per-share impact for the three and nine months ended September 30, 2025 was$0.00 for both basic and diluted Net Loss per common share.

ASU 2025-05

In July 2025, the FASB issued ASU 2025-05,Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The ASU provides all entities with a practical expedient that permits an entity to assume that conditions as of the balance sheet date do not change for the remaining life of current accounts receivable and current contract assets arising from transactions accounted for under ASC 606 when estimating expected credit losses. The Company adopted ASU 2025-05 on January 1, 2026 on a prospective basis. The Company did not elect the practical expedient and therefore the adoption did not have a material impact on the Company’s condensed consolidated financial statements or related disclosures.

During the three months ended September 30, 2026, the Company completedtwo acquisitions, each accounted for as a business combination in accordance with ASC 805,Business Combinations. The Company has not presented supplemental pro forma financial information for these acquisitions. As substantially all of the acquired businesses' revenue was derived from the Company under pre-existing arrangements that are eliminated in consolidation, pro forma results would not differ materially from the Company's reported results.

Tuttle Twins Show, LLC

On August 20, 2026 (the “TTS Closing Date”), the Company completed its previously disclosed acquisition of 100% of the outstanding equity interests of Tuttle Twins Show, LLC (“TTS”) pursuant to the Amended and Restated Agreement and Plan of Merger, dated June 29, 2026 (as amended, the “TTS Merger Agreement”), by and among the Company, Angel Tuttle Merger Sub, LLC, TTS, which owns the rights to the Tuttle Twins series and for which the Company is the distributor under an existing agreement, and Daniel Harmon, as the Unitholder Representative. Prior to the TTS Closing Date, TTS was a related party to the Company, and the Company had an existing distribution and production-funding relationship with TTS (seeNote 8, Related-Party Transactions).

At closing, the Company issued 4,200,695 shares of Class A Common Stock to the former equity holders of TTS. The fair value of these shares of $18.4 million was determined using the closing price of the Company’s Class A Common Stock on the TTS Closing Date of $4.37 per share.

Total consideration transferred at the TTS Closing Date consisted of the following:

The following table summarizes the preliminary allocation of the purchase price to the estimated fair values of the identifiable assets acquired and liabilities assumed as of the TTS Closing Date:

In connection with the TTS acquisition, the Company recognized a deferred tax liability of $0.3 million. Because this deferred tax liability provides a source of future taxable income supporting the realization of certain of the Company’s existing deferred tax assets, the Company released $0.3 million of its valuation allowance, which was recognized as an income tax benefit during the three months ended September 30, 2026, separately from the acquisition accounting.

Goodwill recognized in the TTS acquisition is primarily attributable to expected synergies from integrating TTS’s content and production operations with the Company’s existing distribution platform, and assembled workforce, neither of which qualifies for separate recognition as an intangible asset, and is not expected to be deductible for tax purposes. The Company incurred approximately $0.6 million of acquisition-related costs, which were expensed as incurred and are included in general and administrative expenses in the condensed consolidated statements of operations. Additionally, the Company incurred approximately $0.4 million of costs related to the issuance of Class A Common Stock in connection with the acquisition, which were recognized as a reduction of additional paid-in capital. The Company has not finalized its valuation of the assets acquired and liabilities assumed, and the allocation above is preliminary and subject to revision during the measurement period, which will not extend beyond one year from the TTS Closing Date.

Toothy Cow Productions, LLC

On September 17, 2026 (the “TCP Closing Date”), the Company completed its previously disclosed acquisition of 100% of the outstanding equity interests of Toothy Cow Productions, LLC (“TCP”), which owns the rights to theWingfeather Sagaseries and for which the Company is the distributor under an existing agreement, pursuant to the Amended and Restated Agreement and Plan of Merger, dated June 29, 2026 (as amended, the “TCP Merger Agreement”), by and among the Company, Angel TCP Merger Sub, TCP, and Shining Isle Productions, as Unitholder Representative.

At closing, the Company issued 5,232,230 shares of Class A Common Stock to the former equity holders of TCP. Of these shares,4,113,872 shares are included in consideration transferred at a fair value of $20.2 million, determined using the closing price of the Company’s Class A Common Stock on the TCP Closing Date of $4.90 per share. The remaining 1,118,358 shares are subject to forfeiture if specified performance or service conditions are not met. Of these,997,353 shares are accounted for as equity-classified contingent consideration with an acquisition-date fair value of $2.8 million, which will not be remeasured, and 121,005 shares are accounted for as post-combination compensation with an acquisition-date fair value of $0.6 million.

Total consideration transferred at the TCP Closing Date consisted of the following:

The following table summarizes the preliminary allocation of the purchase price to the estimated fair values of the identifiable assets acquired and liabilities assumed as of the TCP Closing Date:

In connection with the TCP acquisition, the Company recognized a deferred tax asset for the difference between the acquisition-date fair values and the tax bases of the assets acquired and liabilities assumed, primarily related to capitalized production costs. Based on its assessment of the realizability of these deferred tax assets, which considered the Company’s history of cumulative losses, the Company recorded a full valuation allowance against the acquired net deferred tax assets as of the TCP Closing Date. As a result, no net deferred tax asset is included in the preliminary purchase price allocation.

Goodwill recognized in the TCP acquisition is primarily attributable to expected synergies from integrating TCP’s content and production operations with the Company’s existing distribution platform, and assembled workforce, neither of which qualifies for separate recognition as an intangible asset, and is not expected to be deductible for tax purposes. The Company incurred approximately $0.5 million of acquisition-related costs, which were expensed as incurred and are included in general and administrative expenses in the condensed consolidated statements of operations. Additionally, the Company incurred approximately $0.4 million of costs related to the issuance of Class A Common Stock in connection with the acquisition, which were recognized as a reduction of additional paid-in capital. The Company has not finalized its valuation of the assets acquired and liabilities assumed, and the allocation above is preliminary and subject to revision during the measurement period, which will not extend beyond one year from the TCP Closing Date.

Pending Acquisition — Homestead

On November 14, 2025, the Company entered into an Agreement and Plan of Merger (the “Black Autumn Merger Agreement”), by and among the Company, Black Autumn Show, Inc. (“Black Autumn”), which owns the rights to theHomestead film and series and for which the Company is the distributor under an existing agreement, Angel Black Autumn Merger Sub and Matthew Peterson. If completed, Black Autumn stockholders will receive, at the effective time of the merger, the following consideration will be payable: at the effective time, each holder of issued and outstanding shares of Black Autumn Stock will be entitled to receive (a) that number of shares of the Company’s Class A Common Stock equal to (i)(A) the Homestead Per Share Merger Consideration multiplied by (B) the number of shares of Black Autumn Common Stock, par value $0.00001 per share, Black Autumn Series A-1 Preferred Stock, par value $0.00001 per share, Black Autumn Series ACF Preferred Stock, par value $0.00001 per share and Black Autumn Series Seed Preferred Stock, par value $0.00001 per share, held by such holder as of immediately prior to the effective time, divided by (ii) $6.13, plus (b) such holder’s Homestead Pro Rata Share of the Homestead Royalty Shares. Capitalized terms in the foregoing not defined herein shall have the terms assigned to them in the Black Autumn Merger Agreement, filed as Exhibit 2.3 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 12, 2026. Completion is subject to customary closing

conditions. As of the date of this report, the merger has not closed. A member of the Company’s board of directors is an executive producer and board member of Black Autumn (see Note 8, Related-Party Transactions).

Content consists of owned film and episodic content produced or acquired by the Company and accounted for as film costs underASC 926-20, Entertainment-Films-Other Assets-Film Costs. Owned content predominantly monetized through the Angel streaming platform is monetized as a film group, while certain owned content is predominantly monetized on its own.

The Company amortizes content monetized as a film group to cost of revenues based on watch-time, and amortizes content monetized on its own to cost of revenues using the individual-film-forecast-computation method. Content monetized as a film group is assessed for impairment at the film-group level, and content monetized on its own is assessed for impairment individually, in each case when events or changes in circumstances indicate that the fair value may be less than the unamortized cost.

Content consisted of the following:

The following table summarizes the amortization of content:

Amortization of content is included in cost of revenues in the condensed consolidated statements of operations.

The table below summarizes the digital assets shown on the Company’s condensed consolidated balance sheets as of:

The cost basis is determined using the first-in, first-out methodology. The following table summarizes the Company’s digital asset purchases, dispositions, and gains (losses) on digital assets as calculated for the periods indicated:

**5.**Debt

Notes Payable

The following table summarizes the Company’s debt facilities as of September 30, 2026 and December 31, 2025 (in millions):

*The interest rates for these loans are calculated as simple interest, where the amount of interest is a fixed amount of the principal.

Notes with convertible features and/or warrants

May 2025 convertible note with warrants

In May 2025, the Company entered into a note and warrant purchase agreement with an unaffiliated third party, providing for the private placement of a subordinated convertible promissory note and warrant to purchase 163,322 shares of the Company’s Class A Common Stock with an exercise price of $6.13 per share. At the investor’s option and prior to the maturity date, the convertible note and any accrued interest may be converted into shares of the Company’s Class A Common Stock at a fixed price of $6.13 per share. The Company does not have the right to prepay the convertible note. Interest is compounded monthly and payable on the maturity date. A discount of $1.3 million was recorded for the convertible feature of the note and the warrant, as allocated based on the relative fair values of the elements of the convertible note and warrant. This discount was recorded as paid-in capital. Due to the total fair value of the note, including the warrant and convertible feature, being greater than the principal amount of the note, the effective interest rate is greater than the coupon rate and is approximately 30.9%. In September 2025, Steve Sarowitz, who is the controlling person of this unaffiliated third party, became a member of the Company’s board of directors.

September 2025 note with warrants

In September 2025, the Company entered into a loan and security agreement with certain lenders, which provides for up to a $100.0 million term loan with a delayed draw feature, which is composed offour committed tranches: (i) the first tranche in an aggregate principal amount of $40.0 million, which was funded on the closing date; (ii) the second tranche in an aggregate principal amount equal to $20.0 million, which was drawn in February 2026, and is discussed below in theFebruary 2026 note with warrants section; (iii) the third tranche in an aggregate principal amount equal to $20.0 million, which may be drawn on or prior to December 31, 2026 and (iv) the fourth tranche in an aggregate principal amount equal to $20.0 million, which may be drawn on or prior to June 30, 2027. The availability of each tranche will be subject to achievement by the Company of certain conditions, including, without limitation, achievement of a specified minimum annualized recurring revenue and receipt of a minimum of net cash proceeds from the sale or issuance of equity. Borrowings under the credit facility were used to pay off certain of the Company’s existing indebtedness, as well as for general working capital purposes and business operations.

The Company’s obligations under the credit facility will be secured by substantially all of the Company’s assets, but shall exclude the equity held by the Company in, and the assets of, the subsidiaries of the Company that are formed from time to time for the primary purpose of raising capital under Regulation A of the Securities Act of 1933. Borrowings under the credit facility will bear interest at a variable rate equal to the greater of (x) the Prime Rate (as defined under the credit facility)plus 6.0% and (y)13.5%. The Company will be required to make monthly payments of principal and accrued interest (the first 26 months being interest only payments), with the remaining balance being repaid upon maturity on October 1, 2030.

The credit facility contains representations, warranties and covenants that are typical for these types of facilities. These covenants include restrictions on mergers or sales of assets and secured debt borrowings, subject to exceptions and limitations. The credit facility also requires the Company to maintain a minimum liquidity level and contains events of default applicable to the Company that are customary for agreements of this type. In connection with the credit facility, the Company issued each lender thereunder a warrant to purchase an aggregate amount of 1,462,682 shares of the Company’s Class A Common Stock with an exercise price per share of $7.29. The warrants vest and become exercisable in proportion to and in conjunction with the advancement of each tranche under the credit facility. The warrants will expire on September 11, 2030. The Company also granted the lenders rights to participate in future issuances of the Company’s capital stock. As part of the initial draw, the lenders received warrants to purchase 585,072 shares of the Company’s Class A Common Stock with an exercise price of $7.29 per share. A discount of $2.3 million was recorded for the warrant, as allocated based on the relative fair values of the elements of the note and warrant. This portion of the debt discount was recorded as paid-in capital. An additional $0.4 million was booked as a debt discount for commitment fees paid to the lender, and $0.3 million was booked as debt issuance costs for legal and other fees paid to third parties. Due to the total fair value of the note, including the warrant, being greater than the principal amount of the note, the effective interest rate is greater than the coupon rate and is approximately 16.3%.

February 2026 note with warrants

In February 2026, the Company drew the second tranche from the term loan discussed in the September 2025 note with warrants section above. The terms are identical to the September 2025 note. This tranche was for aggregate principal amount equal to $20.0 million. As part of the draw, the lenders received warrants to purchase 292,537 shares of the Company’s Class A Common Stock with an exercise price of $7.29 per share. A discount of $0.2 million was recorded for the warrant, as allocated based on the relative fair values of the elements of the note and warrant. This portion of the debt discount was recorded as paid-in capital. An additional $0.2 million was booked as a debt discount for commitment fees paid to the lender. Due to the total fair value of the note, including the warrant, being greater than the principal amount of the note, the effective interest rate is greater than the coupon rate and is approximately 14.5%.

The following table summarizes further details of the outstanding notes with convertible features and/or warrants as of September 30, 2026:

Components and Fair Value of the Convertible Notes

The convertible note consisted of the following components as of September 30, 2026 and December 31, 2025. The principal shown in the table below consists of the principal amount of the note as well as the interest (which is paid-in-kind each month):

Interest Expense of the Convertible Notes

The following table summarizes interest expenses related to the convertible notes for the three and nine months ended September 30, 2026 and 2025:

**6.**Commitments and Contingencies

Legal Proceedings

The Company is, and from time to time may become, involved in litigation and other legal matters arising in the normal course of business. Management does not believe the outcome of any currently pending matter will have a material adverse effect on the Company’s financial position, results of operations, or liquidity, andno amounts have been accrued as of September 30, 2026.

Disney Settlement

In August 2020, the Company settled copyright litigation brought by Disney Enterprises, Inc. and other studios as part of its reorganization plan, and completed all required cash settlement payments in September 2025. Under the settlement, a separate$62.5 million promissory note will be cancelled upon the Company's continued compliance, over a 14-year period, with covenants restricting

unauthorized uses of the studios' content. The Company has concluded that payment under the note is not probable and, accordingly, no liability for the note has been recognized in the condensed consolidated financial statements.

Equity-Method and Other Investments

2521 Entertainment

In October 2025, the Company and 2521 Entertainment, LLC (“2521”) formed Giant Slayer Media, LLC (“Giant Slayer”), a joint venture that owns the intellectual property for the animated feature film DAVID and associated works. The Company made a total initial capital contribution of$33.7 million, consisting of$31.4 million in cash and$2.3 million credited for a prior investment, in exchange for a 42% equity interest, with 2521 holding the remaining 58%. The Company has significant influence over, but does not control, Giant Slayer and accounts for its interest under the equity method; the Company has concluded it is not the primary beneficiary of Giant Slayer. The carrying value of the investment was$33.7 million at both September 30, 2026 and December 31, 2025, and is included in investments in affiliates on the condensed consolidated balance sheets.

Under the Giant Slayer operating agreement, distributions and earnings are allocated among the members in a specified order of priority under which 2521 first recovers its capital contribution plus a return, then the Company recovers its capital contribution plus a return, before the members participate pro rata based on equity ownership. No earnings were allocated to the Company for the three and nine months ended September 30, 2026. The Company is the exclusive distributor of DAVID under a distribution agreement with Giant Slayer.

Other Investments

In addition to Giant Slayer, the Company holds equity-method investments in other unconsolidated entities in which it has significant influence, including preferred units acquired in October 2023, and investments in entities in which it does not have significant influence that are accounted for under the measurement alternative. The Company's share of the net income of its equity-method investees, other than Giant Slayer, was$0.1 million and$0.2 million for the three and nine months ended September 30, 2026. The aggregate carrying value of these other investments was$10.6 million and$12.3 million at September 30, 2026 and December 31, 2025, respectively.

Guarantees of Third-Party Indebtedness

The Company guarantees repayment of certain third-party loans made to independent film production companies. The Company acts as the film distributor and collection account manager, remitting the royalties from the distribution of the film, the Producer Royalty Rights, directly to the lender as the primary source of loan repayment during the loan term. If the Producer Royalty Rights remitted over the guaranteed term are insufficient to repay the loan in full and the film production company is unable to cover the balance of the loan, the Company is obligated to fund the remaining balance to the lender under a contractual payment undertaking (the "Angel Backstop"). The Angel Backstop is an unconditional and irrevocable guarantee of the borrower's loan repayment obligation.

The Angel Backstop is recognized as a guarantee liability at a Day 1 fair value in accordance with ASC 460, Guarantees, using the probability-weighted present value methodology described in Note 1. The offsetting debit was recorded as a deferred guarantee cost, presented within other long-term assets on the condensed consolidated balance sheet, representing the expected economic recovery of the guarantee obligation through Producer Royalty Rights. After initial recognition, the guarantee liability and deferred guarantee cost are reduced pro-rata as Producer Royalty Rights are applied to the outstanding loan balance.

The following table presents information about the Angel Backstop as of September 30, 2026:

term. Presented gross and undiscounted and has not been reduced by projected royalty recoveries. No collateral is held by the Company in connection with the Angel Backstop.

The Company assesses the probability of being required to make payments under the Angel Backstop based on current projections of film revenue performance relative to the outstanding loan balance. As of September 30, 2026, the Company has assessed the payment risk as low.

In the event the Company is required to make a payment under the Angel Backstop, it retains the contractual right to receive post-term Producer Royalty Rights from the borrower to the extent earned in subsequent periods, representing a potential recovery of amounts funded. No collateral is held by the Company in connection with this guarantee.

Minimum Royalty Guarantees

The Company has entered into agreements with filmmakers that guarantee minimum royalty payments over specified periods, generally not expected to result in a shortfall given anticipated royalties. The Company recognizes royalty expense and a corresponding liability as royalties are earned, with cash payments reducing the liability. As of September 30, 2026, the remaining unrecognized commitments under these agreements are as follows:

During the three and nine months ended September 30, 2026, royalties earned and credited against these guarantees reduced the aggregate remaining commitment by $6.1 million and $31.0 million.

With respect to the Company's minimum royalty guarantee arrangements, the Company has determined that a shortfall between royalties expected to be earned and the guaranteed minimums is reasonably possible, based on box office, licensing deals, and streaming performance of certain films relative to the original projections. The Company continues to project that royalties earned over the remaining terms of these arrangements will be sufficient to satisfy the guaranteed minimum, and no shortfall has been deemed probable as of September 30, 2026. Given the various stages of the distribution windows and in some cases limited performance data to date, the Company is unable to reasonably estimate the amount of any potential shortfall at this time. The Company will continue to monitor the performance of the underlying content and will record a liability for each estimated shortfall in the period in which it becomes probable and reasonably estimable.

**7.**Common Stock

The Company has authorized Common Stock consisting of 700,000,000 shares, par value $0.0001 per share, of which 500,000,000 shares have been designated as Class A Common Stock and 200,000,000 shares have been designated as Class B Common Stock. The Company has also authorized preferred stock consisting of 1,000,000 shares, par value $0.0001 per share. Each outstanding share of Class A Common Stock is entitled toone vote and each outstanding share of Class B Common Stock is entitled toten votes.

Warrant Offerings

In May 2025, the Company entered into a note and warrant purchase agreement with an unaffiliated third party, providing for the private placement of a subordinated convertible promissory note with a principal balance of $5.0 million and warrant to purchase 163,322 shares of the Company’s Class A Common Stock with an exercise price of $6.13 per share. In September 2025, Steve Sarowitz, who is the controlling person of this unaffiliated third party, became a member of the Company’s board of directors. SeeNote 5, Debt for additional details.

In September 2025, the Company entered intotwo notes and warrant purchase agreements with unaffiliated third parties, providing for the private placement of notes with a total principal balance of $40.0 million and warrants to purchase 1,462,682 shares of the Company’s Class A Common Stock with an exercise price per share of$7.29. As part of the initial draw, the lenders received warrants to purchase 585,072 shares of the Company’s Class A Common Stock. The second draw was taken by the Company in February 2026, from which the lenders received warrants to purchase 292,537 shares of the Company’s Class A Common Stock. SeeNote 5, Debtfor additional details.

The Company determined that the outstanding warrants meet the criteria for equity classification. Therefore, the warrants are recorded as a component of additional paid-in capital on the condensed consolidated statements of stockholders’ equity at the time of issuance. The fair value of the warrants was estimated using the Black-Scholes option pricing model at the time of issuance and will not be remeasured throughout their life, pursuant to ASC 815-40.

For more information regarding the note and warrant purchase agreements, refer toNote 5, Debt.

Common Stock Offering

In April 2026, the Company entered into an underwriting agreement with an unaffiliated third party for the issuance and sale of 16,445,000 shares of its Class A Common Stock at a price to the public of$2.10 per share. The Company received net proceeds of approximately $32.5 million, after underwriting discounts, commissions, and estimated offering expenses.

Loss per Share

The following table represents the Company’s loss per share for the three and nine months ended September 30, 2026 and 2025:

Basic loss per share includes no dilution and is computed by dividing net income available to common stockholders by the weighted average common shares outstanding for the period. Diluted loss per share is calculated similarly to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the common shares were dilutive. All potential common shares were anti-dilutive as a result of the Company’s net losses during the three and nine months ended September 30, 2026 and 2025.

The following table sets forth the outstanding potentially dilutive securities that have been excluded in the calculation of diluted loss per share as their inclusion would be anti-dilutive, for the three and nine months ended September 30, 2026 and 2025:

8**.**Related-Party Transactions

The Company has a marketing services contract with an entity owned by one or more of the Company’s directors, officers, and stockholders. During the three months ended September 30, 2026 and 2025, the Company incurred expenses of $0.0 million and $0.2 million, respectively, to the related party for marketing services. During the nine months ended September 30, 2026 and 2025, the Company incurred expenses of $0.3 million and $0.5 million, respectively, to the related party for marketing services.

In February 2024, the Company entered into a revolving P&A loan agreement with Angel P&A, LLC, a Delaware limited liability company (“Angel P&A”) that is wholly owned by one or more of the Company’s directors, officers, and stockholders. Angel P&A was formed for the specific purpose of raising P&A funds for the Company’s upcoming theatrical releases in exchange for revenue participation rights in those films. These rights entitle Angel P&A to receive up to 115.0% of its invested amount, representing its investment plus a return of 10.0% to 15.0%. Angel P&A has first claim on the Company’s cash receipts from each film it funds and must be repaid in full before any other claims on those receipts are paid, except that any P&A funds raised for that film under Regulation A, which falls under Section 3(b) of the Securities Act, are repaid first. When Angel P&A is repaid, it distributes the interest portion to its institutional investors, and the original investment either remains at Angel P&A to fund additional P&A loans to the Company or is returned to the investors until the Company needs the funds again. The commitment periods between Angel P&A and the Company, and between Angel P&A and its investors, run through February 2027. Angel P&A hasno employees and is not expected to incur operating expenses. Each draw typically matures 80 to 120 days after it is made. As of September 30, 2026 and December 31, 2025, the total outstanding balance of revolving P&A loans was $10.5 million and $53.5 million, respectively.

In May 2025, the Company entered into a note and warrant purchase agreement with an unaffiliated third party, providing for the private placement of a subordinated convertible promissory note*.*In September 2025, Steve Sarowitz, who is the controlling person of this unaffiliated third party, became a member of the Company’s board of directors. See Note 5,Debt for additional details.

Benton Crane, a member of the Company’s board of directors, is an executive producer and board member of Black Autumn, and certain directors and officers of the Company or their family members, and certain affiliated entities of the Company, including Angel Acceleration Fund, are entitled to receive shares of Class A Common Stock as consideration in the pending acquisition. The Company has a distribution agreement with the Homestead film and series resulting in payments of $6.5 million during the year ended December 31, 2025, and payments of $6.8 million during the nine months ended September 30, 2026.

Additionally, Benton Crane was a manager of TTS prior to its acquisition, and certain directors and officers of the Company or their family members, and certain affiliated entities of the Company, including Harmon Brothers, LLC and VAS Portal, LLC, own units of TTS, received shares of Class A Common Stock as consideration in the acquisition. On August 20, 2026, the Company completed its acquisition of TTS. See Note 2, Business Combinations, for the consideration transferred and purchase price allocation. In connection with the closing, the Company’s pre-existing production-funding and royalty arrangements with TTS were settled for approximately $2.9 million, which is included within total consideration transferred inNote 2, Business Combinations. The Company made payments, including royalties, to TTS of $2.9 million during the period from January 1, 2026 through the acquisition date and $3.9 million during the year ended December 31, 2025. Following the closing, TTS is a wholly-owned subsidiary of the Company, and transactions between the Company and TTS are intercompany and eliminate in consolidation.

9**.**Subsequent Events

Subsequent events have been evaluated through November 10, 2026, which is the date the condensed consolidated financial statements were issued.

On October 3, 2026, 2521 entered into a $4.3 million funding agreement with the filmmakers ofRode to Ruin, and the Company agreed to backstop the agreement. The Company’s maximum potential undiscounted future payments under the backstop are $4.3 million. The Company has not yet determined the amount of the related guarantee liability. See Note 6, Commitments and Contingencies, for information about the Company’s guarantee arrangements of this type.

On October 28, 2026, the Company purchased production equipment and computer hardware from Harmon Brothers, LLC, a related party, for $0.4 million. SeeNote 8, Related-Party Transactions, for the nature of the related-party relationship.