Newsmax Inc. (NMAX)

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following “Management’s Discussion and Analysis of Financial Condition and Results of Operations” should be read in conjunction with the unaudited consolidated financial statements for the three and six months ended June 30, 2026 and the audited consolidated financial statements for the year ended December 31, 2025, and other information included elsewhere in this Quarterly Report. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from such forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those identified below and those discussed in the sections entitled “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements” included elsewhere in this Quarterly Report and our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 as may be amended supplemental or superseded from time to time by other reports we file with the SEC. Additionally, our historical results are not necessarily indicative of the results that may be expected in any future period.

Overview

We are a global media company delivering news, opinion and entertainment content across multiple television and digital platforms. We serve audiences through our linear television network, streaming and digital properties, and related distribution channels, with a focus on producing compelling programming that builds viewer engagement, deepens loyalty and extends the reach of the Newsmax brand. We seek to enhance the value of our platform by investing in programming, strengthening our digital experience, broadening monetization opportunities and pursuing strategic domestic and international growth initiatives, including distribution and licensing arrangements that extend our content and brand into new markets.

We have developed a significant audience, reaching over 50 million Americans each month through our television broadcasts and multi-platform content, and have demonstrated sustainable growth. Revenues are up 17% and 15% comparing the three and six months ended June 30, 2026, respectively compared to the same period in 2025. Newsmax Broadcasting's TV content is now available to over 100 million homes in the U.S. In addition, international companies have licensed Newsmax Broadcasting’s channels and brand for regional, national and local television and digital media purposes. Certain licensing agreements now provide cable television and digital news under the Newsmax brand to viewers in more than 100 countries including several European countries like Republic of Serbia, Republic of Croatia, Bosnia and Herzegovina, Montenegro, North Macedonia, Slovenia, Albania, Hungary, Poland, Bulgaria, Slovakia, Romania, Ukraine, and the Czech Republic.

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Results of Operations

Three months ended June 30, 2026, versus June 30, 2025

The following table sets forth our results of operations data for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025:

Revenues

Revenues increased by $7.7 million, or 16.5%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025. Affiliate fee revenues increased by $6.0 million due to new contractual relationships as well as rate increases which took effect in late 2025 and 2026. Licensing revenue increased by $3.9 million due to an amendment of one of our licensing agreements that increased the rate and duration of the arrangement in February 2026. Advertising revenue decreased by $(1.1) million due to reductions in digital advertising revenue and a decline in linear cable and satellite advertising, as the same quarter last year benefited from election-related demand. Subscription revenue decreased by $(0.7) million due to lower new customer acquisition offset by gains from expanded affiliate agreements making Newsmax available on more linear cable providers.

Cost of revenues increased by $2.0 million, or 6.9%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The increase was due to increased production headcount, programming and production costs on our main Newsmax TV channel as well as continued investment into Newsmax 2 for OTT to build out the programming to better monetize Newsmax 2 on FAST channels.

Gross Profit

Gross profit increased by $5.7 million, or 32.3%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. Gross profit as a percent of revenues increased to 43.1% for the three months ended June 30, 2026 from 38.0% for the three months ended June 30, 2025. Gross profit percentage increased mainly due to increases in rates for both affiliate fee and licensing revenues.

General and Administrative Expense

General and administrative expense decreased by $(72.0) million or (76.6)%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The decrease was primarily driven by the reduction of legal expenses related to the settlement of legal matters in 2025.

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Other Income, Net

Other income, net increased by $0.3 million, or 26.0%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The increase was primarily driven by an increase in unrealized gains on marketable securities offset by decreases in interest and dividend income.

Segment Analysis

The following tables set forth our Revenues and Segment EBITDA for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025:

Broadcasting

Broadcasting Revenues increased by $7.8 million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, due to an increase in affiliate fee revenue of $6.0 million, which is attributed to new contractual relationships starting later in 2025 as well as rate increases in late 2025 and 2026. Licensing revenue increased by $3.9 million due to an amendment of one of our licensing agreements that increased the rate and duration of the arrangement in February 2026, offset by a decrease in advertising revenue of $(1.8) million due to lower customer insertion order volume and lower subscription revenue of $(0.3) million due to change in subscriber mix.

Broadcasting Segment Adjusted EBITDA increased for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, mainly due to increases in rates for both affiliate and license revenues.

1 For a discussion of Adjusted EBITDA, see “Non-GAAP Financial Measures” below.

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Digital

Digital Revenues decreased by $0.1 million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, due to increases in advertising revenue driven by new contractual relationships offset by reductions in subscription and product revenue.

Digital Segment Adjusted EBITDA increased for the three months ended June 30, 2026, as compared to three months ended June 30, 2025, due to decreases in cost of revenues and general and administrative expenses.

The following table reconciles Net income (loss) to Adjusted EBITDA for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025:

2 For a discussion of Adjusted EBITDA, see “Non-GAAP Financial Measures” below.

3 Comprised of certain litigation expenses, and related fees, for specific legal proceedings that we have determined are infrequent and unusual in terms of their magnitude.

4 Comprised of miscellan

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Readers should carefully review this document and the other documents filed by Newsmax Inc. with the Securities and Exchange Commission (the “SEC”). This section should be read together with the consolidated financial statements and related notes appearing elsewhere in this Annual Report on Form 10-K. The consolidated financial statements are referred to as the “Financial Statements” herein.

Overview of the Company's Business

Founded in 1998 as a digital media brand, Newsmax Inc. entered the cable news market in 2014. Since then, the network has had an astonishing rise, climbing into the top tier of cable channels, and is now the fourth highest-rated cable news channel in the United States, just behind CNN. We have developed a significant audience, reaching over 58 million Americans each month through its television broadcasts and multi-platform content, and has demonstrated remarkable growth. As of December 31, 2025 revenues are up 353% since 2019. In June 2024, a Reuters global survey of media found Newsmax Inc. was one of the nation’s “top news brands,” identifying the network as one of only 12 major media outlets Americans are turning to regularly. For the second year in a row, Newsmax was voted the "most trusted" cable news outlet in the nation by attendees at the 2025 Conservative Political Action Conference.

Newsmax Inc. is a holding company that owns 100% of the equity interests of its operating company Newsmax Media, Inc. and the other Subsidiaries operate the businesses described in this Annual Report, and none of those businesses are operated by Newsmax Inc.

Newsmax Inc. is a television broadcaster and multi-platform content publisher that produces original news and editorial content for consumers through various media outlets, including through its TV news channels, digital and print publications, its popular website Newsmax.com and affiliated sites, its syndicated radio show and podcasts, social media accounts and other platforms in order to sell advertising to third-party marketers as well as offering paid subscriptions to more than a dozen digital and print products sold by Newsmax Media. Newsmax Broadcasting content, notably its Newsmax channel, is carried by all major linear cable and satellite pay TV platforms, or MVPDs. Newsmax Broadcasting also airs its World at War military documentary channel on several MVPDs. Newsmax2, Newsmax Broadcasting's free streaming and FAST channel is carried on almost all top OTT streaming platforms. Newsmax Broadcasting's TV content is now available to over 100 million homes in the U.S. In addition, international companies have licensed Newsmax Broadcasting’s channels and brand for regional, national and local television and digital media purposes. Certain licensing agreements currently in place have allowed Newsmax Broadcasting’s partners to provide cable television and digital news under the Newsmax brand to viewers in several European countries, including Republic of Serbia, Republic of Croatia, Bosnia and Herzegovina, Montenegro, North Macedonia, Slovenia, Albania, Hungary, Poland, Bulgaria, Slovakia, Romania, and the Czech Republic.

Newsmax Inc. operates several business lines through its subsidiaries and divisions, creating a synergistic effect on audience growth, revenues and customer acquisition. These business lines are grouped into two separate reportable segments which consist of Broadcasting and Digital:

Broadcasting - The broadcast segment of our business produces and licenses news, business news and lifestyle content for distribution primarily through multichannel video programming distributors (“MVPDs”) including cable television systems, direct broadcast satellite operators and telecommunication companies, primarily in the United States, generating revenue through (1) placement of advertisements on our broadcast content, (2) subscriptions to our broadcast content, and (3) affiliate fees from the MVPDs. The components of Broadcasting are as follows:

•Newsmax Broadcasting provides programming through three channels, Newsmax, Newsmax2, and World at War. Newsmax and World at War are linear cable channels available on pay TV services, and Newsmax2, is a free streaming channel. Both Newsmax and Newsmax2 offer 24/7 television news and informational programming channels which are distributed through both cable and digital streaming platforms. World at War offers 24/7 historical documentaries and movies that have a primary focus on the wars of the past 150 years and the people who fought them.

•Newsmax Radio provides programming through a syndicated "Rob Carson Show" as well as widely-available podcasts. These podcasts include “The Newsmax Daily with Tony Marino,” a talk show with radio personality Gerry Callahan and “Greg Kelly Reports” with its TV host Greg Kelly.

Digital - The digital segment generates revenues through (1) online advertising, including online display, email advertising, other online placements and print advertisements, (2) subscriptions, including our collection of specialized health and financial newsletters, Newsmax Magazine and four online membership programs, and (3) e-commerce, primarily through our subsidiaries that sell nutraceuticals and nonfiction books on political, financial and health-related topics. The components of Digital are as follows:

•Humanix Publishing is a print and e-book publishing house that publishes books in the areas of politics, health, personal finance, history, religion and current affairs. Under Newsmax ownership, Humanix Publishing has published approximately 100 titles, including seven New York Times bestsellers. We use our published books as free premiums when offering subscriptions to their publications, including Newsmax Magazine and our health and financial newsletters.

•Medix Select offers and sells 22 nutraceutical products. Medix Select’s products are aimed at Newsmax Media’s core demographic of consumers and cross-sold through Newsmax Media’s health newsletters. These supplements have been certified as compliant with current Good Manufacturing Practices by The Natural Products Association and are typically formulated by medical doctors who also write and edit Newsmax Media’s health newsletters. Newsmax Media retains all intellectual property rights to the supplement formulations created for Medix Select. The natural supplements seek to help customers alleviate pain, reduce blood glucose, prevent heart disease, improve energy and mental acuity, and, in general, improve overall wellness. All Medix Select supplements are manufactured at third-party manufacturing facilities that are FDA registered and meet current Good Manufacturing Practices standards. All Medix Select supplements are offered online and are usually purchased as part of a recurring subscription program.

•Newsmax Media Digital Advertising handles advertising and marketing offers and sales to third party companies and agencies associated with our digital segment. Newsmax Digital Advertising sells placements for display and native website ads, email sponsorships in Newsmax News Alerts, sponsorships for SMS/text and push notification, print ads for our Newsmax Magazine, inserts for our newsletters, and podcast offerings.

•Newsmax Publications publishes and manages Newsmax Media’s paid subscription business with over 300,000 subscribers. This division currently publishes Newsmax Magazine, five health newsletters including Health Radar, Dr. Crandall’s Heart & Health; The Blaylock Wellness Report; financial newsletters including The Dividend Machine, High Income Factor and Financial Intelligence Report, and Newsmax Platinum, our online publication.

•ROI Media Strategies provides media buying and strategy services to third party companies and agencies, helping companies to market their offerings across all channels of marketing, including email, broadcast, podcasts, digital, and print.

•Crown Atlantic Insurance is an insurance agency licensed in 50 states of the U.S. and the District of Columbia with an emphasis on life insurance and retirement solutions. Newsmax Media’s subsidiaries use Crown Atlantic Insurance for the purposes of marketing annuities, life insurance and other insurance offerings across their platforms. The Company is not currently marketing such products but expects to in the near future.

Growth Strategies and Outlook

Maintain and enhance leading position in news and other content production.

Newsmax Media has been a leader in digital news and with the continued growth of its television service, plans to continue to invest in online content and offerings. Additionally, Newsmax Broadcastings plans additional talent acquisition and programming efforts that we expect will raise the profile and visibility of the Newsmax brand and its affiliates to a broader audience. With expanded content offerings, Newsmax Media plans to expand its reach and value to audiences through traditional platform and direct-to-consumer services.

Increase revenue growth through the continued delivery of premium content.

Newsmax Media will continue to focus on creating high-quality content delivered through diversified publishing platforms that offers value to its audience, advertisers and distribution partners. As a live linear content on cable, the Newsmax channel continues to offer a unique perspective and voice that resonates with audiences across those platforms and further develop a dedicated and loyal audience.

Expand television and digital distribution offerings, increasing complementary sources of revenues.

Newsmax Broadcasting’s key goals are to maximize its subscriber penetration on traditional cable platforms, growing its subscription base for Newsmax+, while increasing audiences for its news channels, Newsmax, Newsmax2 and World at War, develop its footprint in international markets - all while creating additional revenue opportunities through advertising sales. Newsmax Media and Newsmax Broadcasting will also further develop its delivery strategies on emerging content and social platforms to increase interaction with its audience.

Newsmax, as a relatively new network, has potential for additional distribution growth, and growth of its advertising and affiliate fee revenue, which was a new revenue stream that began in 2024. Linear Pay-TV is primarily driven by live sports, news and events, and as media companies continue to focus on expanding their streaming service offerings, news consumption has risen in importance.

Trends and Other Factors Impacting Our Performance

Our broadcast segment derives the majority of its revenues from advertising. For the year ended December 31, 2025, we generated revenues of approximately $189.3 million, of which 63.6% was generated from advertising in the broadcast and digital segments, 16.2% was generated from affiliate fee revenue, 14.5% was generated from subscriptions for publications including Newsmax+ and 5.7% was generated from other lines of business which are primarily e-commerce sales of nutraceuticals, books and licensing fees.

For the year ended December 31, 2024, we generated revenues of $171.0 million, of which 63.8% was generated from advertising in the broadcast and digital segments, 15.6% was generated from affiliate fee revenue, 15.7% was generated from subscriptions for publications including Newsmax+ and 4.9% was generated from other lines of business which are primarily e-commerce sales of nutraceuticals, books and licensing fees.

The cable network programming and television industries continue to evolve rapidly, with changes in technology leading to alternative methods for the delivery and storage of digital content. These technological advancements have driven changes in consumer behavior as consumers now have more contro

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