Versant Media Group, Inc. (VSNT)

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion of our financial condition and results of operations should be read in conjunction with our interim condensed consolidated and combined financial statements and the accompanying notes included elsewhere in this Quarterly Report on Form 10-Q. For more information about our company’s operations, see “Item 1. Business” in our Annual Report on Form 10-K. The following discussion and analysis includes forward-looking statements. These forward-looking statements are based on our current expectations and are subject to risks, uncertainties and other factors that could cause our actual results to differ materially from those expressed or implied by the forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed in our Annual Report on Form 10-K, as well as those discussed below and elsewhere in this report, particularly in “Special Note Regarding Forward Looking Statements” and “Item 1A. Risk Factors.”

Overview

We are a media and entertainment business that operates in four core markets: political news and opinion, business news and personal finance, golf, and sports and genre entertainment. We serve these markets primarily through a strong portfolio of brands comprised of renowned networks and complementary digital platforms.

The following is a summary of our financial performance:

•Revenue of $1.64 billion and $1.71 billion for the three months ended June 30, 2026 and 2025, respectively, and $3.33 billion and $3.41 billion for the six months ended June 30, 2026 and 2025, respectively.

•Net income attributable to Versant of $211 million and $302 million for the three months ended June 30, 2026 and 2025, respectively, and $497 million and $669 million for the six months ended June 30, 2026 and 2025, respectively.

•Adjusted EBITDA of $624 million and $685 million for the three months ended June 30, 2026 and 2025, respectively and $1,328 million and $1,442 million for the six months ended June 30, 2026 and 2025, respectively. Adjusted EBITDA is a financial measure not defined by GAAP. See “Non-GAAP Financial Measures” below for additional information, including our definition and use of Adjusted EBITDA and for a reconciliation from net income attributable to Versant to Adjusted EBITDA.

•Cash flows from operations of $967 million and $1,113 million for the six months ended June 30, 2026 and 2025, respectively.

Recent Events and Factors Affecting Results of Operations and Comparability

Separation and Transition to Standalone Company

Versant became a standalone public company following the Separation from Comcast on January 2, 2026. We have incurred and will continue to incur incremental costs related to operating as a public company, including external reporting, internal audit, treasury, investor relations, board of directors, and stock administration, and expanding the services of existing functions such as information technology, finance, supply chain, human resources, legal, tax, facilities and insurance. These costs are higher than operating costs in our combined financial statements for periods prior to the Separation, which were generally allocated on a pro rata basis using an applicable measure of revenue. Accordingly, the combined financial statements for periods prior to the Separation do not reflect our results of operations, financial position, and cash flows had we been a separate, standalone company during those historical periods. See Note 1 to our consolidated and combined financial statements for additional information on the basis of presentation of the financial statements included in this report.

In connection with the Separation, we incurred approximately $3.0 billion of debt, including our Senior Notes and Term Loans (see Note 5). A portion of the proceeds from these borrowings were used to fund a cash payment to Comcast of $2.25 billion.

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Acquisition

On August 3, 2026, we acquired Full Swing, a leading sports technology company with patented hardware and integrated software used by consumers, competitive athletes, coaches, and commercial venues, for approximately $530 million in cash, subject to customary purchase price adjustments.

Divestiture

During the second quarter of 2026, we completed the sale of our SportsEngine business, resulting in decreases in revenue and operating expenses for periods following the sale. Total revenue generated from SportsEngine was $13 million and $30 million, respectively, for the three months ended June 30, 2026 and 2025, and $48 million and $65 million, respectively, for the six months ended June 30, 2026 and 2025.

Key Factors Affecting Our Business

We believe the key business and marketplace factors that are impacting our business include the following:

•Consumer Demand for Cable Television. The amount of revenue we earn from multichannel video programming distributors (“MVPDs”) for the distribution of our networks has declined in recent years, primarily reflecting ongoing declines in MVPD subscriber levels due to evolving consumer preferences for consuming video content, and is expected to continue to decline in the future. As a result of these trends, we expect that our future success will depend on, among other things, our ability to compete with alternative content distribution platforms, our success in reaching new audiences by extending our content offerings through new distribution outlets, and our continued ability to distribute our networks on MVPDs on favorable terms.

•Advertising. We derive significant revenue from selling advertising on our networks, and have experienced in recent years, and expect to continue to experience, declines in advertising revenue caused by changes in advertiser priorities primarily due to increased competition for the leisure time of viewers and increased audience fragmentation primarily from greater use of streaming and digital platforms (all of which we expect will continue in the foreseeable future), as well as by cyclical factors, such as election cycles and the timing of sporting events and macroeconomic conditions. In addition, lower audience ratings and reduced viewership, which our networks have experienced, and likely will experience in the future, affect pricing and the willingness of advertisers to purchase advertising.

•Growth of Digital Platforms. Our digital platforms generate revenue from selling advertising, providing services directly to consumers and selling cloud-based technology and related services. The growth of digital platforms continues to be shaped by evolving consumer behavior and broader macroeconomic conditions, including changes in consumer spending patterns, concerns about data privacy and evolving preferences for digital engagement through websites and mobile applications. Our revenue from our digital platforms has grown in recent years, and we expect that it will continue to grow as we invest in this growing portion of our business.

•Competition for Programming. The market for programming has been, and we expect will continue to be, very competitive. In recent years, sports programming in particular has become significantly more competitive and expensive. We expect to continue to devote significant resources to acquire sports programming in the future, and our ability to continue to provide compelling content will be vital to our success.

•Impact of Macroeconomic Conditions. A substantial portion of our revenue is impacted by consumer spending patterns, which are affected by prevailing economic conditions. Downturns in global economic conditions have in the past, and may in the future, negatively affect the spending patterns of consumers and, as a result, our current and potential customers, advertisers, vendors and others with whom we do business.

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•Brand Value and Reputation. Our brand image, awareness and reputation strengthen our relationship with our audiences and can be important drivers of consumer and advertiser engagement. We are establishing the Versant brand as a standalone public company and elevated public scrutiny, geopolitical tensions and rapid consumer reaction have heightened reputational concerns.

We evaluate these and other factors as we develop and execute our strategies.

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Operating Results

Percentage changes that are considered not meaningful are denoted with NM.

(a) Adjusted EBITDA is a non-GAAP financial measure. Refer to “Non-GAAP Financial Measures” for additional information, including our definition and our use of Adjusted EBITDA, and for a reconciliation from net income attributable to Versant to Adjusted EBITDA.

Revenue

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Linear distribution revenue decreased for the three and six months ended June 30, 2026 as compared to the corresponding prior year periods, primarily due to continued declines in subscribers, which were partially offset by contrac

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion of our financial condition and results of operations should be read in conjunction with our combined financial statements and the accompanying notes included elsewhere in this Annual Report on Form 10-K. For more information about our company’s operations, see “Item 1. Business”. The following discussion and analysis includes forward-looking statements. These forward-looking statements are based on our current expectations and are subject to risks, uncertainties and other factors that could cause our actual results to differ materially from those expressed or implied by the forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed elsewhere in this Annual Report on Form 10-K, particularly in “Note About Forward Looking Statements” and “Item 1A. Risk Factors.”

Overview

We are a media and entertainment business that operates in four core markets: political news and opinion, business news and personal finance, golf and athletics participation and sports and genre entertainment. We serve these markets primarily through a strong portfolio of brands comprised of renowned networks and complementary digital platforms.

The following is a summary of our financial performance, which is presented on a combined basis as part of Comcast and does not reflect our expected cost structure in periods following the Separation:

•Revenue of $6.69 billion and $7.06 billion for 2025 and 2024, respectively;

•Net income attributable to Versant of $930 million and $1.36 billion for 2025 and 2024, respectively;

•Adjusted EBITDA of $2.42 billion and $2.80 billion for 2025 and 2024, respectively. Adjusted EBITDA is a financial measure not defined by generally accepted accounting principles in the United States (“GAAP”). See “Non-GAAP Financial Measures” below for additional information, including our definition and use of Adjusted EBITDA and for a reconciliation from net income attributable to Versant to Adjusted EBITDA.

•Cash flows from operations of $2.0 billion and $2.21 billion for 2025 and 2024, respectively.

Recent Events and Factors Affecting Results of Operations and Comparability

Transition to Standalone Company

On January 2, 2026, the Separation of Versant from Comcast was completed through the distribution of 100% of the shares of Versant Class A common stock and Versant Class B common stock (together, the “common stock”) to holders of Comcast Class A common stock and Comcast Class B common stock as of the close of business on the record date of December 16, 2025. In connection with the Separation, Comcast’s shareholders of record received one share of Versant Class A common stock or Class B common stock for every 25 shares of Comcast Class A common stock or Comcast Class B common stock, respectively, held as of the record date. Immediately after the separation, holders of Comcast’s common stock prior to the distribution owned 100% of our issued and outstanding shares. On January 5, 2026, Versant’s Class A common stock began trading on Nasdaq under the ticker symbol “VSNT”.

Upon our Separation, we became subject to the requirements of federal and state securities laws and Nasdaq stock exchange requirements. We have begun to establish additional procedures and practices as a standalone company and have started to, and will continue to, incur additional expenditures in connection with our transition to a standalone company, including employee-related costs, costs to establish certain standalone functions and information technology systems, and other transaction-related costs. In addition, we have incurred, and will continue to incur, incremental costs related to operating as a public company, such as external reporting, internal audit, treasury, investor relations, board of directors, and stock administration, and expanding the services of existing functions such as information technology, finance, supply chain, human resources, legal, tax, facilities and insurance.

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In connection with our Separation, we incurred approximately $3.0 billion of total debt, as further described in Note 8 to the combined financial statements and the “Liquidity” discussion below. Proceeds from the offering of our Senior Notes, together with a portion of the net proceeds of the borrowings under the Term Loans, were used to fund a special cash payment to Comcast of $2.25 billion and pay fees and expenses related to the financing transactions.

Held for Sale

In December 2025, we initiated a process to sell our SportsEngine business and the related assets and liabilities are classified as held for sale in our combined balance sheet as of December 31, 2025.

Basis of Presentation

For the periods presented in the combined financial statements included in this report, the Versant businesses were operated as part of Comcast. The combined financial statements have been derived from Comcast’s historical accounting records as if Versant operations had been conducted independently from Comcast, and reflect the assets, liabilities, revenues and expenses of the Company on a historical cost basis. The combined financial statements were prepared in accordance with GAAP and pursuant to the rules and regulations of the SEC, which required allocations and other carve-out methodologies, using assumptions that management believes are reasonable. Accordingly, the combined financial statements herein for periods prior to the Separation may not be indicative of our future performance, do not necessarily include the actual expenses that would have been incurred by us, and may not reflect our results of operations, financial position, and cash flows had we been a separate, standalone company during the historical periods presented. See Note 1 to our combined financial statement for additional information.

Key Factors Affecting Our Business

We believe the key business and marketplace factors that are impacting our business include the following:

•Consumer Demand for Cable Television. The amount of revenue we earn from MVPD distribution has declined in recent years, primarily reflecting ongoing declines in MVPD subscriber levels due to evolving consumer preferences for consuming video content, and is expected to continue to decline in the future. As a result of these trends, we expect that our future success will depend on, among other things, our ability to compete with alternative content distribution platforms, our success in reaching new audiences by extending our content offerings through new distribution outlets, and our continued ability to distribute our networks on MVPDs.

•Advertising. We derive significant revenue from selling advertising on our networks, and have experienced in recent years, and expect to continue to experience, declines in advertising revenue caused by shifts in advertiser priorities primarily due to increased competition for the leisure time of viewers, increased audience fragmentation and increased use of streaming and digital platforms (all of which we expect will continue in the foreseeable future), as well as by cyclical factors, such as election cycles and the timing of major sporting events, the availability of advertising-blocking technologies and macroeconomic conditions. In addition, lower audience ratings and reduced viewership, which our networks have experienced, and likely will continue to experience, affect pricing and the willingness of advertisers to purchase advertising.

•Growth of Digital Platforms. Our digital platforms generate revenue from selling advertising, providing services directly to consumers and selling cloud-based technology and related services. The growth of digital platforms continues to be shaped by evolving consumer behavior and broader macroeconomic conditions, including changes in consumer spending patterns, concerns about data privacy and evolving preferences for digital engagement through websites and mobile applications. Our revenue from our digital platforms has grown in recent years, and we expect that it will continue to grow as we invest in this growing portion of our business.

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•Competition for Programming. The market for programming has been, and we expect will continue to be, very competitive. In recent years, sports programming in particular has become significantly more competitive and expensive. We expect to continue to devote significant resources to acquire sports programming in the future, and our ability to continue to provide compelling content will be vital to our success.

•Impact of Macroeconomic Conditions. A substantial portion of our revenue is impacted by consumer spending patterns, which are affected by prevailing economic conditions. Downturns in global economic conditions have in the past, and may in the future, negatively affect the spending patterns of consumers and, as a result, our current and potential customers, advertisers, vendors and others with whom we do business.

•Brand Value and Reputation. Our brand image, awareness and reputation strengthen our relationship with our audiences and can be important drivers of consumer and advertiser engagement. We are establishing the Versant brand as a standalone public company and elevated public scrutiny, geopolitical tensions and rapid consumer reaction have heightened reputational concerns.

•Public Company Costs. As a result of the Separation and costs associated with running an independent, publicly traded company, we have incurred and expect to continue to incur expenditures that are higher than historical allocations that were allocated pro rata based on revenue, which may have an impact on our profitability and operating cash flows.

We evaluate these and other factors as we develop and execute our strategies. For more information on the risk factors affecting our business, see “Item 1A. Risk Factors.”

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Operating Results

Percentage changes that are considered not meaningful are denoted with NM.

(a) Adjusted EBITDA is a non-GAAP financial measure. Refer to “Non-GAAP Financial Measures” for additional information, including our definition and our use of Adjusted EBITDA, and for a reconciliation from net income attributable to Versant to Adjusted EBITDA.

Revenue

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