Paramount Skydance Corp (PSKY) Risk Factors

Item 1A. Risk Factors.

A wide range of risks may affect our business, financial condition or results of operations, now and in the future. We consider the risks described below to be the most significant. There may be other currently unknown or unpredictable factors that could have adverse effects on our business, financial condition or results of operations.

Risks Relating to Our Business and Industry

If our streaming business is unsuccessful, our business, financial condition or results of operations could be adversely affected.

Streaming is intensely competitive and capital intensive and our streaming business may not be profitable or otherwise successful. Our ability to continue to attract, engage and retain streaming subscribers and active users (together, “users”), as well as generate corresponding subscription and advertising revenues, depends on a number of factors, including our ability to consistently provide appealing and differentiated content that resonates globally, offer a quality experience for selecting and viewing that content, execute a windowing strategy that maximizes service appeal and the value of our content, successfully market our content and services, and make effective choices globally regarding whether we distribute our content and services directly through our owned-and-operated services or through third parties, including through hard bundles, MVPD bundles and channel distributors. Our success will require significant investments to produce original content and acquire the rights to third-party content, including sports, as well as the establishment and maintenance of key content and distribution partnerships. If we are unable to manage costs, maintain such partnerships, or achieve sufficient scale, we may fail to meet our profitability goals.

In addition to attracting new users, we must also meaningfully engage existing users to minimize “churn” and maximize our advertising and subscription revenues. If consumers do not perceive our streaming services to be of value compared to competing services, including because we fail to introduce compelling new content and features, do not maintain competitive pricing, terminate or modify promotional or trial period offerings, change the mix of content in a manner that is unfavorably received, or offer an inferior consumer viewing experience, we may not be able to attract, engage and retain users, and our business, financial condition or results of operations could be adversely affected. If subscribers who receive access to our streaming services through third-party bundles, including through MVPDs, cancel or discontinue their subscriptions, including as a result of selecting an alternative bundle that does not include our services or canceling or discontinuing such bundled service, our business may be adversely affected. The advertising revenues we generate from our advertising-supported streaming offerings may also be affected by fluctuations in user engagement. If we are unable to attract, engage and retain users and offset the loss of users who cancel or stop engaging with our streaming services, our business, financial condition or results of operations could be adversely affected.

Our advertising revenues have been and may continue to be adversely impacted by several factors, including changes in consumer behavior and advertising market conditions.

We generate substantial revenues from the sale of advertising, and a decline in advertising revenues has had, and could continue to have, an adverse effect on our business, financial condition or results of operations.

The evolution of consumer preferences toward streaming and other digital services, and the increasing number of entertainment choices available to consumers, have intensified audience fragmentation and reduced viewership through traditional linear distribution models, which has caused and may continue to cause ratings and viewership declines for our television networks. This evolution has also given rise to new ways of purchasing advertising, as well as a general shift in total advertising expenditures toward streaming and digital, some of which may not be as beneficial to us as traditional advertising models. In addition, an increase in the number of advertising-supported streaming offerings has intensified, and may continue to intensify, competition for viewers and advertising. There can be no assurance we can successfully navigate the evolving streaming and digital advertising market or that the

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advertising revenues we generate in that market will offset declines in advertising revenues from our traditional linear business.

Our advertising business is sensitive to general macroeconomic conditions as well as the economic prospects and spending priorities of specific advertisers or industries. Our ability to generate advertising revenues also depends on demand for our content, the viewers in our targeted demographics, advertising rates, targeting capabilities, results observed by advertisers, the perceived effectiveness of our advertising offerings and alternative advertising options. Natural and other disasters, pandemics, acts of terrorism, political uncertainty or hostilities could also lead to a reduction in domestic and international advertising expenditures as a result of disrupted programming and services and economic uncertainty.

Major sports events, such as the Super Bowl and the NCAA Division I Men’s Basketball Tournament, and state, congressional and presidential election cycles, may cause our advertising revenues to vary substantially from year to year. Political advertising expenditures are impacted by the ability and willingness of candidates and political action campaigns to spend funds on advertising, the competitive nature of the elections affecting viewers in markets featuring our content and the timing of election cycles.

Advertising sales are also largely dependent on audience measurement and could be negatively affected if measurement methodologies do not accurately reflect viewership levels. In addition, if advertising buyers require the use of specific television measurement solutions, our inability to reach or maintain agreements with the providers of such solutions may negatively impact our advertising revenues. The industry is currently transitioning to a multiplatform measurement environment in an effort to more completely measure viewership and advertising across linear, streaming and digital, but has not yet established a consistent methodology for such measurement. Currently, the primary measurement technique used in our television advertising sales does not fully measure viewership across streaming and digital platforms. We measure and monetize across our streaming services using census-based advertising-server data to establish the number of impressions served, combined with third-party data providing demographic composition estimates. Multiplatform campaign verification is still not measured by any one consistently applied method. While we expect innovation and standards around multiplatform measurement to benefit us as the advertising market continues to evolve, we are nevertheless partially dependent on third parties to deliver those solutions.

Our ability to generate advertising revenues can also be impacted, and in certain circumstances has already been impacted, by an increasing number of global laws and regulations, including limitations on how we deliver to, target or measure audiences. In addition, regulatory actions that restrict how certain industries may advertise their products can reduce demand for advertising inventory and adversely affect our advertising revenues. See “—Risks Relating to Legal and Regulatory Matters—We are subject to complex, often inconsistent and potentially costly laws, regulations, industry standards and contractual obligations relating to privacy and data protection.”

We operate in highly competitive and dynamic industries and our business, financial condition or results of operations could be adversely affected if we do not compete effectively.

We face substantial and increasing competition to attract creative talent, to produce and acquire the rights to high-quality content, acquire, engage and retain audiences and users, and distribute our content and services across a range of third-party platforms. Competition for talent, content, audiences, subscribers, service providers, advertising, production infrastructure and distribution is intense and comes from other television networks and stations, streaming services (including those that provide pirated content), social media, content studios, independent content producers and distributors, consumer product companies and other entertainment outlets and platforms, as well as from “second screen” applications.

Our competitors include companies with interests across multiple media and entertainment businesses that are often vertically integrated, as well as companies in adjacent sectors with significant financial, marketing and other resources, greater efficiencies of scale, fewer regulatory constraints and more competitive pricing. In addition, faster or more effective deployment of evolving technologies by our competitors, including generative artificial intelligence and other machine‑learning tools (“AI Technologies”), could put us at a competitive disadvantage. Our

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competitors may also consolidate or enter into business combinations or alliances that strengthen their competitive position. We also rely on third-party platforms with which we compete to make our content available to users, and if these third parties are unwilling to continue to distribute our content or do so on terms favorable to us, our business, financial condition or results of operations could be adversely affected.

These increased competitive pressures have resulted in, and may continue to result in, increased costs, including with respect to talent and intellectual property rights. We invest significant resources to produce, market and distribute original content. We also acquire content and ancillary rights and pay related rights fees (including for sports and music rights), license fees, royalties and/or contingent compensation. If these competitive pressures continue to increase, we may not be able to produce or acquire content in a cost-effective manner. We may be outbid by competitors for the rights to new, popular content or in connection with the renewals of popular rights we currently hold.

This competition could result in a decrease in audiences and users, lower ratings and advertising revenues, lower affiliate and other revenues, and increased content and promotional costs, which could negatively affect our ability to generate revenues and profitability. If we are not able to compete successfully in the future against existing or new competitors, it could have an adverse effect on our business, financial condition or results of operations.

The unpredictable and constantly shifting nature of consumer behavior, as well as evolving technologies and distribution models, have affected, and could continue to adversely affect, our business, financial condition or results of operations.

Our success depends on our ability to anticipate and adapt to shifting content consumption patterns, evolving technologies and distribution models.

Our ability to maintain attractive brands and to create, distribute and/or license popular content is key to our success and ability to generate revenues. The revenues we generate primarily depend on our ability to consistently anticipate and satisfy consumer tastes and expectations in the U.S. and internationally. Consumer tastes and behavior change frequently, and it is a challenge to anticipate what will resonate with audiences at any given time. The popularity of our original and acquired content is affected by our ability to target key audiences; the quality and attractiveness of competing content; and the availability and popularity of alternative forms of entertainment and leisure activities, general economic conditions and other tangible and intangible factors, all of which can be unpredictable. Declines in the popularity of our content, including sports for which we have acquired rights, could have an adverse effect on our business, financial condition or results of operations.

Evolving technologies, including AI Technologies, and distribution models, as well as the overall size of the entertainment and content market, affect demand for our content; how our content is generated, distributed and consumed; the sources and nature of competing offerings; and advertisers’ options for reaching target audiences, any of which can affect the predictability of our revenues and profitability. These developments have impacted certain traditional distribution models, including ones we have historically relied upon, as demonstrated by industrywide declines in broadcast and cable ratings, declines in cable subscribers, the development of alternative distribution platforms for broadcast and cable content and reduced theatergoing. Declines in linear viewership are expected to continue and may accelerate, which could adversely affect our advertising and affiliate revenues.

Shifts in consumer behavior may also be exacerbated by events outside our control, including prolonged disruptions to our ability to create content caused by global events such as pandemics or industry-wide labor actions similar to what we experienced in 2023 with the Writers Guild of America (“WGA”) and the Screen Actors Guild-American Federation of Television and Radio Artists (“SAG-AFTRA”) strikes.

To respond to these developments, we regularly evaluate and adopt new technologies and business strategies, including our increased investment in streaming. However, we may not successfully anticipate or respond to these developments and may experience disruption as we respond to such developments. Further, the new technologies or business models we develop may not be as successful or profitable as historical or existing ones.

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Decisions to invest in new businesses, products, services and technologies, and the evolution of our business strategy, could adversely affect our business, financial condition or results of operations.

To effectively respond to market and consumer changes, we have made, and expect to continue to make, changes to our business strategy that are subject to execution risk, and they may not produce anticipated benefits. As part of the evolution of our business strategy, we have invested in or otherwise implemented, and expect to continue to invest in or implement, new businesses, products, services, technologies and other strategic initiatives, including through tender offers, mergers, acquisitions, strategic partnerships and investments, as well as through restructurings, cost savings and other transformation initiatives such as workforce reductions, new enterprise solutions and changes to our reporting structure and segments. These changes may involve significant risks and uncertainties, including: difficulty integrating acquired businesses and technologies; failure to realize anticipated benefits; unanticipated expenses and liabilities; disruption to our business and operations; diversion of management attention; difficulty managing operations; the loss or inability to retain key employees and creative talent; challenges to or loss of relationships with users, audiences, advertisers, suppliers, distributors and licensors; legal and regulatory limitations; and insufficient revenues from such investments to offset new liabilities and expenses. Integrating or replacing legacy systems with new technologies may also present operational challenges. Many of these factors are outside our control, and because new investments are inherently risky, and the anticipated benefits or value of these investments may not materialize, such investments and other strategic initiatives may adversely affect our business, financial condition or results of operations.

The loss of affiliation and distribution agreements, renewals on less favorable terms or adverse interpretations thereof could have an adverse effect on our business, financial condition or results of operations.

A significant portion of our revenue is attributable to agreements with a limited number of distributors. There can be no assurance these agreements will be renewed, or renewed on favorable terms, including terms related to pricing, programming tiers and the types of rights we grant distributors. The loss of existing packaging, positioning, pricing or other opportunities and the loss of carriage (including service blackouts) or the failure to renew or any delay in renewing our agreements with distributors, or the renewal of such agreements on less favorable terms, could reduce the distribution of our content, decrease the potential audience for our content and negatively affect our growth prospects, affiliate fees and advertising revenues, and our reputation with viewers. The CBS Network provides affiliated television stations regularly scheduled programming in return for the insertion of network commercials and payment of reverse compensation. The loss of such station affiliation agreements, or renewals on less favorable terms, would reduce the reach of our programming and therefore our appeal to advertisers, adversely affecting our results of operations.

Consolidation and vertical integration among distributors in the cable and broadcast network businesses has provided more leverage to these distributors and could adversely affect our ability to maintain or obtain distribution for our network programming or distribution and/or marketing of our subscription services on favorable or commercially reasonable terms, or at all. Consolidation among television station group owners could similarly increase their leverage. Competitive pressures faced by MVPDs, particularly in light of evolving consumer consumption patterns and new distribution models, could adversely affect the terms of our renewals with MVPDs. In addition, MVPDs continue to develop alternative offerings, and if these offerings exclude our content and gain widespread acceptance, we could experience a decline in affiliate revenues.

Our revenues also depend on the compliance of major distributors with the terms of our affiliation or distribution agreements. As these agreements have grown in complexity, disputes regarding their interpretation and validity have increased, resulting in greater uncertainty and, at times, litigation over rights and obligations. Some of our distribution agreements contain “most favored nation” (“MFN”) clauses, which provide that if we enter into an agreement with a distributor and such agreement includes terms that are more favorable than those held by a distributor holding an MFN right, we must offer some of those terms to the distributor holding the MFN right. Disagreements with a distributor on the interpretation or validity of an agreement could adversely impact our affiliate and advertising revenues, as well as our relationship with that distributor.

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Damage to our reputation or brands could adversely affect our business, financial condition or results of operations.

Our reputation and globally recognized brands are critical to our success. Our reputation depends on a number of factors, including the quality of our content, services and other offerings, the level of trust we maintain with our consumers and our ability to innovate and adapt to changing expectations. Because our brands engage consumers across our businesses, damage to our reputation or brands in one business may have an impact on our others and, because some of our brands are recognized around the world, brand damage may not be locally contained. Our reputation and brands may be harmed by significant negative claims or publicity regarding Paramount or its business decisions, operations, practices, content, products, social responsibility and culture, management, employees, business partners and individuals associated with the content we create or license, even if such claims are untrue. Our ability to adequately prepare for or respond to such claims or publicity may be limited, particularly given the speed and reach of social media, which can amplify actual or perceived incidents before we have an opportunity to investigate or respond meaningfully. Damage to our reputation or brands could negatively impact sales, viewership, user engagement, business opportunities, profitability, talent retention and recruitment, and the price of our Class B Common Stock.

Losses due to asset impairment charges for goodwill, content and long-lived assets, including finite-lived intangible assets, could have an adverse effect on our business, financial condition or results of operations.

Certain events and circumstances can result in a decline in the values of our reporting units, content, or asset groups containing our finite-lived intangible assets, which could result in noncash impairment charges. Deterioration of market conditions, increases in interest rates and/or unfavorable impacts to the projections used in goodwill and long-lived asset impairment tests (including from changes in consumer behavior, a decrease in audience acceptance of our content and platforms and delays or difficulties in achieving our profitability goals for our streaming services), could result in a downward revision in the estimated fair value of our reporting units or long-lived assets, which could result in a noncash impairment charge. In 2024, Paramount Global recorded programming charges totaling $1.12 billion as a result of major strategic changes in its content strategy that led to the removal of significant levels of content from our platforms, the abandonment of development projects and the termination of certain programming agreements. Future strategic changes could result in further programming charges. Any such impairment charge for goodwill, programming, and/or long-lived assets could have a material adverse effect on our reported net earnings.

Our liabilities related to discontinued operations and former businesses could adversely affect our business, financial condition or results of operations.

We have both recognized and potential liabilities and costs related to discontinued operations and former businesses, certain of which are unrelated to our existing business, including leases, guarantees, environmental liabilities, liabilities related to the pensions and medical expenses of retirees, asbestos liabilities, contractual disputes and other pending and threatened litigation. There can be no assurance our accruals for these matters are sufficient to cover these liabilities, individually or in the aggregate, if and/or when they become due. Therefore, these liabilities could have an adverse effect on our business, financial condition or results of operations.

Increasing scrutiny of, and evolving expectations for, sustainability initiatives could increase costs, harm our reputation or otherwise adversely impact our business, financial condition or results of operations.

A number of disclosure requirements relating to sustainability matters have taken effect or are expected to take effect in the next several years in the U.S. and Europe, including the Climate Corporate Data Accountability Act and the Climate-Related Financial Risk Act in California, the E.U.’s Corporate Sustainability Reporting Directive (CSRD). While the full costs and operational impacts of compliance are not yet known, noncompliance with these or other applicable laws and regulations could result in financial, operational and reputational risks. At the same time, there has been an increase in proposed or enacted “anti-ESG” and “anti-DEI” legislation, regulation, policies, enforcement priorities, litigation, directives, initiatives and legal opinions. Conflicting regulations and

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requirements and a lack of harmonization of legal and regulatory environments across the jurisdictions in which we operate may create enhanced compliance risks and costs.

We have also faced, and may continue to face, increasing scrutiny from our consumers, advertisers, distributors, suppliers, licensors, creative talent, employees and other stakeholders relating to the appropriate role of sustainability-related practices and disclosures. If we fail—or are perceived to fail—to achieve or properly report on our progress toward achieving voluntary goals we have set out, or if our goals are not perceived as being sufficiently robust, our business, brand or reputation may be negatively impacted and subject to additional investor or regulatory scrutiny. Furthermore, some market participants, including major institutional investors and providers of debt and equity financing, may also consider our performance in these areas and the ratings of third-party benchmarks or scores (which we have limited ability to influence) in their decisions involving our Company, which could impact our cost of capital and adversely affect our business, financial condition or results of operations. These opposing views may also be adopted by our investors.

Risks Relating to Business Continuity, Cybersecurity and Privacy and Data Protection

Disruptions or failures of, or attacks on, our or our service providers’ networks, information systems and other technologies could result in the disclosure of business or personal information, disruption of our businesses, damage to our brands and reputation, and legal exposure and financial losses.

Cloud services, networks, software, information systems and other technologies we use or that are used by our third-party service providers and our product suppliers (“Providers”), including technology systems used by us and our Providers in connection with the production and distribution of our content and that otherwise perform important functions (“Systems”), are critical to our business activities. These Systems have experienced, and are expected to continue to experience, cybersecurity attacks intended to disrupt our services and operations, exfiltrate, corrupt or prevent our access to and/or use of our data, proprietary information or intellectual property, or exfiltrate or corrupt the personal and other information of third parties, employees, contractors and customers. Shutdowns, disruptions and attacks on our or our Providers’ Systems pose increasing risks to our business and may be caused by third-party hacking; dissemination of computer viruses, worms, malware, ransomware and other destructive or disruptive software; denial-of-service attacks and other bad acts; human error; and power outages, natural disasters, extreme weather, terrorist attacks or other similar events. Shutdowns, disruptions and attacks could have an adverse impact on us, our business partners, advertisers and other Providers, employees, consumers of our content, including degradation or disruption of service, loss of data or intellectual property, and damage to equipment and data. Steps we or our Providers take to enhance, improve or upgrade Systems may not be sufficient to avoid shutdowns, disruptions and attacks. In addition, the rapid global advancement of AI Technologies may also heighten our risks by making cyberattacks more difficult to detect, contain, and mitigate. Significant events could result in a disruption of our operations and reduction of our revenues, the loss of or damage to intellectual property, the loss of or damage to the integrity of data used by management to make decisions and operate our businesses, viewer or advertiser dissatisfaction or a loss of viewers or advertisers, and damage to our reputation or brands. In addition, our recovery and business continuity plans may prove inadequate to address any such disruption, failure or cybersecurity attack. We are subject to risks caused by the misappropriation, misuse, falsification or intentional or accidental release or loss of business or personal data or content maintained in our or our Providers’ Systems, including proprietary and personal information of third parties, employees and users of our online, mobile and app offerings, business information, including intellectual property, or other confidential information. Outside parties may attempt to penetrate our or our Providers’ Systems, or fraudulently induce or impersonate employees, business partners or users of our online, mobile and app offerings to disclose sensitive or confidential information, to gain access to our proprietary data or the data of our users, employees or contractors, our content or other intellectual property. The number and sophistication of attempted and successful phishing, information security breaches or disruptive ransomware or denial-of-service attacks have increased significantly in recent years, and because of our prominence or the prominence of our content, we and/or our Providers may be a particularly attractive target. Because the techniques used to obtain unauthorized access to, or disable, degrade or sabotage, networks and Systems change frequently, we or our Providers may be unable to anticipate these techniques, implement adequate security measures or remediate flaws or detect intrusions on a timely or effective basis. We also rely on proprietary

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and third-party technologies to optimize operations across certain areas of our business. The use of these technologies may lead to unintentional disclosure of sensitive, confidential, proprietary or personal information of ours and of our employees or customers. Such technologies may be subject to manipulation or prone to error from data or manipulation outside our direct control. We operate an information security program to identify and mitigate cybersecurity risk. Despite our efforts, the risk of unauthorized access, modification, exfiltration, destruction or denial of access with respect to our data, the data of our customers and employees or our Systems and other cybersecurity attacks cannot be eliminated entirely, and the risks associated with a potential incident remain. If a breach or perceived breach of our Systems or those of our Providers occurs, the perception of the effectiveness of our security measures could be harmed, we could lose consumers, revenues, advertisers and other business partners, and users of our online, mobile and app offerings; our reputation, brands, credibility and the overall attractiveness of our offerings could be damaged; and we could be required to expend significant amounts of money and other resources to repair, replace or recover such Systems. We could also be subject to actions by regulatory authorities and claims asserted in private litigation. The costs relating to any data breach could be material, and we may not have adequate insurance coverage to compensate us for any losses associated with such events.

Risks Relating to Intellectual Property

Challenges in protecting and maintaining our intellectual property rights could have an adverse effect on our business, financial condition or results of operations.

Our success depends in part on our ability to maintain and monetize our intellectual property rights. We are fundamentally a content company and infringement of our content adversely affects the value of our content. Copyright infringement is particularly prevalent in many parts of the world that lack effective laws and technical protection measures similar to those in the U.S. and Europe or lack effective enforcement of such measures, or both. Such foreign copyright infringement can also create a supply of pirated content for major markets. The interpretation of copyright, trademark and other intellectual property laws as applied to our content, and our infringement-detection and enforcement efforts, remain in flux, and some methods of enforcement have encountered political or commercial opposition. The failure to appropriately enforce and/or the weakening of existing intellectual property laws could make it more difficult for us to adequately protect and monetize our intellectual property and thus negatively affect its value. Copyright infringement is made easier by the wide availability of higher bandwidth and reduced storage costs, as well as tools that undermine encryption and other security features and enable infringers to disguise their identities online. We and our production and distribution partners operate various technology systems in connection with the production and distribution of our programming and films, and intentional or unintentional acts could result in unauthorized access to our content. The continuing proliferation of digital formats and technologies heightens this risk. Internet-connected televisions, set-top boxes and mobile devices are ubiquitous, and many can support illegal retransmission platforms, illicit video-on-demand or streaming services and preloaded hardware, providing more accessible, versatile and legitimate-looking environments for consuming unlicensed film and television content. Unauthorized access to our content could result in the premature release of films, television programs or other content as well as a reduction in demand for authorized content, which would likely have adverse effects on the value of the affected content and our ability to monetize it. The legal landscape continues to evolve with respect to the development and increased prevalence of certain new technologies, including AI Technologies. As a consequence, we face uncertainty with respect to our ability to protect our intellectual property and brands from unauthorized use, misappropriation, and infringement utilizing such technologies, and an increased risk of being subjected to claims brought by third-party rights owners with respect thereto. Copyright infringement reduces the revenue we are able to generate from the legitimate sale and distribution of our content, undermines lawful distribution channels, reduces the public’s and some affiliate partners’ perceived value of our content and inhibits our ability to recoup or profit from the costs incurred to create such content. We are actively engaged in enforcement and other activities to protect our intellectual property, and it is likely we will continue to expend resources in connection with these initiatives. Efforts to prevent the unauthorized reproduction, distribution and exhibition of our content may affect our profitability and may not be successful in preventing harm to our business. We also face risks arising from disputes over the validity, enforceability or scope of our intellectual property rights, and successful challenges to these

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rights could result in increased costs or reduced revenues. In addition, we are on occasion subject to claims that we are infringing third-party rights. For example, our streaming platforms and technology are subject to patent infringement litigation and other claims seeking both damages and injunctive relief. The outcome of these matters could adversely affect our business, financial condition or operating results.

Risks Relating to Macroeconomic and Political Conditions

Economic and political conditions in the U.S. and around the world could have an adverse effect on our business, financial condition or results of operations.

Our businesses operate and have audiences, customers and partners worldwide. Accordingly, economic conditions in the U.S. and around the world affect various aspects of our business. The global financial markets have experienced significant recent volatility, marked by declining economic growth, diminished liquidity and availability of credit, declines in consumer confidence, significant concerns about persistently high inflation and uncertainty about economic stability. The global financial markets have also been adversely affected by geopolitical events. There can be no assurance that further deterioration in credit and financial markets and confidence in economic conditions will not occur. Volatility and weakness in the capital markets, the tightening of credit markets or additional decreases in our debt ratings could adversely affect our ability to obtain cost-effective financing. Inflationary pressures in the U.S. over the past several years have raised our costs for labor and services and other costs required to operate our business. Economic conditions in each market can impact our audience’s discretionary spending and, in turn, their willingness to pay for our content. Economic conditions in each market can also impact the businesses of our advertising partners, potentially causing them to reduce spending or increase payment cycles. In addition, foreign currency fluctuations have impacted, and may continue to impact, revenues and expenses of our international operations and expose us to exchange rate risk. Our revenues may also be affected by political conditions in the U.S. such as changes in government leadership and shifts in policy priorities at the federal, state and local levels. Political risks inherent in conducting a global business include retaliatory actions by governments in response to U.S. or foreign policy changes, including trade negotiations and tariffs, as well as changes in the availability, scope or conditions of production-related tax credits, incentives or other similar benefits; issues related to the presence of corruption in certain markets and enforcement of anticorruption laws and regulations; increased risk of political instability in some markets as well as conflict and sanctions preventing us from accessing those markets; changes in trade and immigration policies; nuclear tensions; wars, terrorism or other hostilities; and other political or economic uncertainties. These economic and political risks could create instability in any of the markets where our businesses generate revenues, which could result in a reduction of revenues or loss of investment that adversely affects our business, financial condition or results of operations.

Risks Relating to Legal and Regulatory Matters

Failures to comply with or changes in U.S. or foreign laws or regulations could have an adverse effect on our business, financial condition or results of operations.

We are subject to a wide range of laws and regulations in the U.S. and in the foreign jurisdictions in which we or our partners operate, including laws and regulations relating to intellectual property, advertising and content regulation, consumer protection, privacy, data protection, cybersecurity, anticorruption, repatriation of profits, tax regimes, quotas, tariffs or other trade barriers, currency exchange controls, operating license and permit requirements, restrictions on foreign ownership or investment, anticompetitive conduct, and export and market access restrictions. The broadcast and cable industries in the U.S. are highly regulated by federal laws and regulations issued and administered by various federal agencies. For example, we are required to obtain licenses from the FCC to operate our television stations and periodically renew them, and it cannot be assured that the FCC will approve our future renewal applications or that the renewals will be for full terms or will not include conditions or qualifications. The nonrenewal, or renewal with substantial conditions or modifications, of one or more of our licenses could have an adverse effect on our business, financial condition or results of operations. We must also comply with various FCC limits on the ownership of our television stations, which could restrict our ability to consummate future transactions and in certain circumstances could require us to divest some television

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stations, and on the operation of both our television stations and the CBS Network in the U.S. In addition, there has been consideration from time to time as to whether virtual MVPDs should be considered MVPDs as defined and regulated by the FCC. Our business could be adversely affected by new laws and regulations, changes in existing laws, changes in the interpretation or enforcement of existing laws by courts and regulators, and the threat that additional laws or regulations may be forthcoming, as well as our ability to enforce our legal rights. Laws and regulations governing new technologies, including AI Technologies, remain unsettled and are an area of increasing regulatory focus, and legal and regulatory developments in this area could also impact our business. Changes in the legal or regulatory landscape could require us to change or limit certain of our business practices, which could impact our ability to generate revenues. We could also incur substantial costs to comply with new and existing laws and regulations, or face substantial fines and penalties or other liabilities, or be subjected to increased scrutiny from regulators and stakeholders, if we fail to comply with such laws and regulations.

We are subject to complex, often inconsistent and potentially costly laws, regulations, industry standards and contractual obligations relating to privacy and data protection.

We are subject to laws, regulations, industry standards and contractual obligations in the U.S. and in other countries relating to privacy and the collection, use, processing, transfer, storage and security of personal data. In the E.U., for example, we are subject to the European Union General Data Protection Regulation (“E.U. GDPR”) and in the U.K., to the U.K. General Data Protection Regulation and Data Protection Act 2018 (“U.K. GDPR,” and together with E.U. GDPR, “GDPR”), which mandate data protection compliance obligations and authorize significant fines for noncompliance, requiring extensive compliance resources and efforts on our part. Further, several other jurisdictions where we do business have enacted, amended or are considering new data protection regulations that may impact our business activities. In the U.S., numerous states have passed comprehensive data privacy laws. These laws mandate a host of obligations for businesses regarding how they handle personal information and provide new and expansive rights to the residents of these states. In 2025, comprehensive privacy laws in the U.S. and internationally were amended to, among other things, expand the threshold for the scope of those laws, expand protections for children and teens, enhance protection for health-related personal data and expand the definition of personal information. Other data privacy laws, such as health data privacy laws, may also have an impact on our business, especially with regard to some of our digital advertising offerings to advertisers in the health and wellness industries. Enforcement of privacy laws has continued to increase, with focus on contractual provisions, the effective operation of consent and opt-out tools and signals (including cookie consents), adequate transparency of privacy practices, and the proper processing of sensitive personal information. In addition, existing and amended U.S., state and international data protection laws may impose stringent obligations to notify impacted individuals and regulators in the event of unauthorized access, loss, or exposure of personal information often within tight statutory deadlines to report. We are also subject to laws and regulations in the U.S. and in other jurisdictions around the world that are intended specifically to protect the interests of children and the online safety and privacy of minors, such as, in the U.S., the federal Children’s Online Privacy Protection Act, as amended (“COPPA”), and various evolving and newly enacted state laws, including comprehensive privacy laws and laws specifically directed to the protection of children online. In the U.S., the Federal Trade Commission issued an update to its Rule under COPPA, imposing several new obligations on operators of online services. Many states have also passed various additional protections for minors limiting the data that can be collected from or about minors and limiting or prohibiting altogether behavioral or targeted advertising to minors. Further, in the E.U. and the U.K., we are subject to the GDPR, as well as codes of conduct and rules relating to the design of digital products and services likely to be accessed by children, including the U.K.’s Age Appropriate Design Code and other guidance documents issued in France, Ireland, the Netherlands, Spain, Sweden and other jurisdictions. As a result, we have been required to limit some functionality on digital properties and may be limited relative to our ability to leverage new media with respect to children’s programming or services. Such regulations also restrict the types of advertising we are able to sell on these digital properties and how we perform measurement for advertising purposes and impose strict liability on us for certain of our actions, as well as certain actions of our advertisers and other third parties, which could affect advertising demand and pricing. Although we strive to comply with privacy and data protection laws, regulations, industry standards and contractual obligations, these requirements are continuously evolving and may be modified, interpreted, and applied in an inconsistent manner from one jurisdiction to another and may conflict with one another or other legal obligations with which we must

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comply, which raises both costs of compliance and the likelihood that we will fail to satisfy all of our legal requirements. Any actual or perceived noncompliance could result in regulatory investigations and enforcement, investigation and remediation costs, significant monetary fines, breaches of contractual obligations, private litigation or harm to our reputation and market position.

Changes and uncertainties with respect to taxes in the jurisdictions in which we operate may have an adverse effect on our business, financial condition or results of operations.

We and our subsidiaries conduct business globally and are subject to tax in multiple U.S. federal, state and local and non-U.S. jurisdictions. Our tax position could be materially adversely affected by several factors, including: new or changing tax laws both domestically and internationally, including regulations and treaties, or the interpretation thereof, tax policy initiatives and reforms under consideration by the international community (such as those related to the Organization for Economic Co-operation and Development’s Base Erosion and Profit Shifting Project, the European Commission’s state aid investigations and other initiatives), the practices of tax authorities in jurisdictions in which we operate (including changes in the availability, scope or conditions of production-related tax credits, incentives or other similar benefits), and the resolution of issues arising from tax audits, examinations or assessments and any related interest or penalties. We are currently unable to predict whether such changes or events will occur and, if so, the ultimate impact on our business. To the extent that any such changes or events negatively impact us, including as a result of related uncertainty, our business, financial condition or results of operations may be adversely impacted.

Risks Relating to Human Capital

The inability to hire or retain key employees or secure creative talent could adversely affect our business, financial condition or results of operations.

Our business depends on the continued efforts, abilities and expertise of our executives and other employees and the creative talent with whom we work. We compete for executives in highly specialized and rapidly evolving industries and our ability to attract, retain and engage such individuals may be impacted by our reputation; workplace culture; restructurings, cost savings and other transformation initiatives, including workforce reductions; the training, development, compensation and benefits we provide; our commitment to effectively managing executive succession; and our efforts with respect to inclusion and sustainability matters. We also employ or contract with entertainment personalities with loyal audiences and produce films and other content with highly regarded directors, producers, writers, actors and other creative talent in highly competitive markets. These individuals are important to attracting viewers and to the success of our content, and our ability to attract and retain them may also be impacted by our reputation, culture, inclusion and sustainability efforts. There can be no assurance these individuals will remain with us or maintain their current appeal, or that the costs associated with retaining them or new talent will be reasonable. If we fail to retain or attract new key employees or creative talent, our business, financial condition or results of operations could be adversely affected.

Labor disputes could disrupt our operations and adversely affect our business, financial condition or results of operations.

We and our business partners engage the services of writers, directors, actors, musicians and other creative talent, production crew members, trade employees, professional athletes and others who are subject to collective bargaining agreements. Any labor dispute may disrupt our operations and cause production delays, which could increase our costs and have an adverse effect on our business, financial condition or results of operations. In 2023, for example, the WGA and SAG-AFTRA commenced industry-wide strikes following the expiration of their collective bargaining agreements with the Alliance of Motion Picture and Television Producers (“AMPTP”), which negotiates with the guilds on behalf of certain content producers. These strikes resulted in months-long shutdowns in television and film production, with effects that have extended beyond the work stoppages. Upcoming negotiations with other unions could lead to further work stoppages. For example, the AMPTP’s agreement with the WGA expires in May 2026, while its agreements with both the Directors Guild of America and SAG-AFTRA expire in June 2026. In addition, the U.S. has in recent years experienced a surge in labor activity, including

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unionization and strikes. There can be no assurance we will renew collective bargaining agreements on favorable terms or avoid work stoppages.

Risks Relating to the Transactions

Combining Paramount Global’s and Skydance’s businesses may be more difficult, time-consuming or costly than expected and the actual benefits of the combination may be less than expected, either or both of which may adversely affect our future results.

We may not be able to integrate Paramount Global’s and Skydance’s businesses in a manner that facilitates growth opportunities and achieves certain cost savings, operating synergies and revenue growth trends identified by each company without adversely affecting current revenues or investments in future growth.

The combination of two independent businesses is complex, costly and time-consuming and may divert significant management attention and resources toward integration planning at the expense of Paramount Global’s and Skydance’s ordinary-course business practices and operations. This process also may disrupt their businesses. Paramount Global and Skydance operated as independent businesses until the completion of the Transactions. Now that the Transactions are complete, our management may face significant challenges in integrating the technologies, organizations, systems, procedures, policies and operations, as well as addressing the different business cultures at Paramount Global and Skydance, managing the increased scale and scope of the combined business, identifying and eliminating duplicative programs, and retaining key personnel. Failure to meet the challenges involved in combining the businesses and to realize the anticipated benefits of the Transactions could adversely affect our business, financial condition or results of operations. The combination of Paramount Global’s and Skydance’s businesses may also result in material unanticipated problems, expenses, liabilities, competitive responses, and loss of customer and other business relationships or strategic partnerships, including:

•the diversion of management attention to integration matters and/or litigation matters brought against the companies;

•difficulties in integrating operations and systems, including intellectual property and communications systems, administrative and information technology infrastructure and financial reporting and internal control systems;

•challenges in conforming business cultures, standards, controls, procedures and accounting and other policies between the two companies;

•difficulties in integrating employees and compensation structures, and attracting and retaining key personnel, including talent;

•challenges in retaining existing, and obtaining new customers, viewers, suppliers, distributors, licensors, lessors, employees, business associates and others, including material content providers, writers, producers, directors, actors and other talent, and advertisers;

•difficulties in achieving anticipated cost savings, synergies, business opportunities, financing plans and growth prospects from the combination;

•difficulties in managing the expanded operations of a larger and more complex company;

•challenges in continuing to develop valuable and widely accepted content and technologies;

•contingent liabilities that are larger than expected; and

•potential unknown liabilities, adverse consequences and unforeseen increased expenses associated with the Transactions.

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Many of these factors are outside our control and any one of them could result in lower revenues, higher costs and diversion of management time and energy, which could materially and adversely impact our business, financial condition or results of operations. In addition, even if the operations of the businesses are integrated successfully, the full benefits of the Transactions may not be realized or may take longer to realize than currently expected, including, among others, the anticipated synergies, cost savings or growth opportunities. These benefits may not be achieved within the anticipated time frame or at all. Further, additional unanticipated costs may be incurred in the integration of the businesses. All of these factors could cause dilution to the earnings per share of our Class B Common Stock, decrease or delay the projected benefits of the Transactions, and negatively impact the price of our Class B Common Stock following the Transactions. As a result, no assurances can be provided that the combination will result in the realization of the full benefits expected from the Transactions within the anticipated time frames or at all.

Several lawsuits have been filed in connection with the Transactions and additional lawsuits may be filed in the future challenging the Transactions. An adverse ruling in any such lawsuit could result in substantial costs and otherwise adversely affect our business, financial condition or results of operations.

Several lawsuits have been filed in connection with the Transactions and additional lawsuits may be filed in the future challenging the Transactions. These matters could subject us to significant defense costs and potential liability, regardless of the merits of the underlying claims. We cannot predict the outcome, timing or ultimate impact of these matters, and any adverse development—whether through an unfavorable judgment, settlement, discovery ruling, or additional litigation or regulatory inquiries—could result in substantial costs and divert management attention, and may delay, impede, or otherwise adversely affect our business, financial condition and results of operations. Even the continued existence of these proceedings, and any future proceedings or demands that may be brought, could create uncertainty, affect our access to capital, and negatively impact the market price and volatility of our securities. See “Item 3. Legal Proceedings” for additional information regarding these proceedings.

Risks Relating to Ownership of Our Common Stock

We have experienced, and may continue to experience, volatility in the price of our Class B Common Stock.

We have experienced, and may continue to experience, volatility in the price of our Class B Common Stock. Various factors have impacted, and may continue to impact, the price of our Class B Common Stock, including variations in our operating results; changes in our estimates, guidance or business plans; variations between our actual results and expectations of securities analysts, and changes in recommendations by securities analysts; changes by any ratings agency to our outlook or credit ratings; market sentiment about our business, including the viability of our streaming business and views related to its profitability; the activities, operating results or stock prices of our competitors or other industry participants in the industries in which we operate; changes in management; the announcement or completion of significant transactions by us or a competitor; events affecting the stock market generally; and the broader macroeconomic and political environment in the U.S. and internationally, as well as other factors and risks described in this section. Some of these factors may adversely affect the price of our Class B Common Stock, regardless of our operating performance.

Our dual class capital structure and the concentrated control by the entities controlled by the Ellison Family may adversely affect our stock price or business.

Our dual class capital structure, combined with the concentrated control of our Company by entities controlled by the Ellison Family, may result in a lower trading price or greater fluctuations in the price of our Class B Common Stock, adverse publicity or other adverse consequences or additional costs. Certain index providers have in the past announced restrictions on including companies with dual class capital structures in certain of their indices and some index providers have determined that they will exclude non-voting stock, like our Class B Common Stock, from their membership. As a result, our dual class capital structure may render the shares of our Class B Common Stock ineligible for inclusion in such stock indices. Given the sustained flow of investment funds into passive strategies that seek to track certain indices, exclusion from stock indices could preclude investment by many of

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these funds and make our Class B Common Stock less attractive to investors. As a result, the market price and liquidity of our Class B Common Stock, as well as public sentiment, could be materially adversely affected.

If the entities controlled by the Ellison Family sell a controlling interest in our Company to a third party in a private transaction, our stockholders may not realize any change of control premium on shares of our Class B Common Stock and we may become subject to the control of a presently unknown third party.

Entities controlled by the Ellison Family indirectly own a controlling interest in our Company. Subject to our organizational documents, the entities controlled by the Ellison Family have the ability, should they choose to do so, to sell, or cause the sale of, some or all of the shares of our Common Stock held directly and indirectly by them in a privately negotiated transaction, which, if sufficient in size, could result in a change of control. Further, the distribution or sale, directly or indirectly, by the NAI Equity Investors of a substantial number of shares, even if not a controlling interest, or a perception that a distribution or such sales could occur, could significantly reduce the price of our Class B Common Stock.

Risk Factors Relating to Our Organization and Structure

We are exempt from certain corporate governance requirements because we are a “controlled company” within the meaning of Nasdaq rules, and as a result our stockholders do not have the protections afforded by these corporate governance requirements.

Harbor Lights and its applicable subsidiaries control 100% of our combined voting power for the election of our Board of Directors. As a result, we are considered a “controlled company” for the purposes of Nasdaq listing standards, and, therefore, are not required to comply with certain Nasdaq corporate governance requirements, including the requirements that a majority of our Board of Directors consists of “independent directors,” as defined under Nasdaq rules, and that our Board of Directors has a compensation committee composed entirely of independent directors. For so long as we remain a “controlled company,” we may, at any time and from time to time, utilize any or all of the applicable governance exemptions available to controlled companies under Nasdaq rules. We currently avail ourselves of the exemptions from the requirements to have a majority of independent directors on the Board of Directors, an entirely independent Compensation Committee, and independent director oversight of director nominations. Accordingly, holders of our Class B Common Stock do not have the same protections afforded to stockholders of companies that are subject to all of Nasdaq’s rules and corporate governance standards, and the ability of our independent directors to influence our business policies and affairs may be reduced. We expect to remain a controlled company until the Ellison Family or Harbor Lights and its applicable subsidiaries no longer control, including indirectly, more than 50% of our combined voting power. Additionally, we will have twelve months from the date we cease to be a “controlled company” to have a majority of independent directors on our Board of Directors.

Holders of our Class B Common Stock have no voting rights and, as a result, do not have any ability to influence stockholder decisions.

Except as required by applicable law, holders of our Class B Common Stock have no voting rights. Accordingly, all matters submitted to our stockholders are decided by the vote of holders of our Class A Common Stock, each share of which is entitled to one vote. Harbor Lights and its applicable subsidiaries hold 100% of our Class A Common Stock (which is not listed for trading on a stock exchange). Entities controlled by the Ellison Family indirectly hold approximately 77.5% of our Class A Common Stock through their collective approximately 77.5% ownership interest in Harbor Lights. This concentrated control prevents holders of our Class B Common Stock from influencing corporate matters and, as a result, our Board of Directors and/or holders of our Class A Common Stock may take actions that holders of our Class B Common Stock do not view as beneficial.

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Anti-takeover provisions contained in our Charter and Bylaws, as well as provisions of Delaware law, could impair a takeover attempt.

Provisions of our amended and restated certificate of incorporation (“Charter”) and amended and restated bylaws (“Bylaws”), in addition to those relating to the voting rights of our Common Stock, may have the effect of delaying, deferring or preventing a change in control of, or changes in our management. These include provisions that:

•authorize our Board of Directors to provide for the issuance, without stockholder approval, of up to 100 million shares of preferred stock with rights, powers and preferences fixed by our Board of Directors (subject to certain limitations set forth in our Charter), which rights, powers and preferences could be senior to those of our Common Stock;

•provide that each Specified Reserved Matter Designee (as defined in our Charter) will have the right to consent to entrance into a binding agreement contemplating, or otherwise consummating, a Change of Control Event (as defined in our Charter);

•provide that each director (except for the Ellison Designees (as defined in our Charter), but including any Low-Vote Designee (as defined in our Charter)) will be entitled to one vote for so long as Ellison (as defined in our Charter) holds an Original Ownership Percentage (as defined in our Charter) of at least 50%; provided that each Ellison Designee (which will not include any Low-Vote Designee) will have a number of votes on any matter presented to our Board of Directors or any committee thereof equal to one more than the total number of directors of the whole Board of Directors or committee thereof, as applicable; and

•provide that each Specified Stockholder (as defined in our Charter) will have the exclusive right to (i) remove at any time, with or without cause, its respective designee from our Board of Directors and (ii) subject to the rights of holders of any series of our preferred stock, fill any vacancy created at any time by the death, removal, disqualification or resignation of any director designated by such Specified Stockholder with a new designee.

These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in our management and reduce the price that investors might be willing to pay for shares of our Class B Common Stock in the future, which could reduce the price of our Class B Common Stock. We have elected in the Charter not to be subject to Section 203 of the General Corporation Law of the State of Delaware (the “DGCL”). Subject to specified exemptions, Section 203 of the DGCL prohibits a Delaware corporation listed on a national securities exchange from engaging in a “business combination,” including mergers, consolidations, sales and leases of assets, issuances of securities and other similar transactions, with an interested stockholder (generally, a person that, together with its affiliates and associates, owns 15% or more of the corporation’s voting stock) for a period of three years after the date of the transaction in which the person became an interested stockholder. As a result of our election in the Charter to not be subject to Section 203 of the DGCL, such restrictions on business combinations under Section 203 of the DGCL are not applicable to us.

The provisions of our Charter requiring exclusive venue in the Court of Chancery of the State of Delaware for certain types of lawsuits and the federal district courts of the U.S. for the resolution of any complaint asserting a cause of action under the Securities Act may have the effect of discouraging lawsuits against our directors and officers.

Our Charter provides that unless our Board of Directors consents in writing to the selection of an alternative forum, (A) the Court of Chancery of the State of Delaware be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, employees, agents or stockholders to us or to our stockholders, (iii) any action asserting a claim arising pursuant to any provision of the DGCL, our Charter or Bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware or (iv) any action asserting a claim governed by the internal affairs doctrine, in each such case subject to such Court of Chancery having personal jurisdiction over the

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indispensable parties named as defendants therein or, if such court does not have subject matter jurisdiction thereof, the federal district court located in the State of Delaware; and (B) the federal district courts of the U.S. shall be the exclusive forum for the resolution of any complaint asserting a cause or causes of action arising under the Securities Act of 1933, as amended (the “Securities Act”). Notwithstanding the foregoing, the exclusive forum provision shall not apply to claims seeking to enforce any liability or duty created by the Exchange Act. Although we believe this provision benefits us by providing increased consistency in the application of Delaware law in the types of lawsuits to which it applies, the provision may have the effect of discouraging lawsuits against our directors and officers. It is possible that, in connection with any applicable action brought against us, a court could find the choice of forum provisions contained in our Charter to be inapplicable or unenforceable in such action. If a court were to find the choice of forum provisions contained in our Charter to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business, financial condition or results of operations.

The competitive opportunity provisions in our Charter could enable certain directors, principals, officers, employees, members and/or equity holders or their respective affiliates to benefit from competitive opportunities that might otherwise be available to us.

Our Charter provides that, to the fullest extent permitted by law, we renounce any interest or expectancy in a transaction or matter that may be a competitive opportunity for certain directors, principals, officers, employees, members, equity holders and/or other representatives of the NAI Equity Investors and certain other affiliates of investors of Skydance or their respective affiliates (the “Identified Persons”) (other than any such Identified Person in his or her capacity as a director of our Company), and such Identified Persons have no duty to refrain from directly or indirectly (i) participating or otherwise engaging in any competitive opportunity, (ii) otherwise competing with us or any of our controlled affiliates, (iii) otherwise doing business or transacting with any potential or actual customer, supplier or other business relation of ours or any of its controlled affiliates or (iv) otherwise employing or engaging any officer, employee or other service provider of ours or any of our controlled affiliates. In addition, the Identified Persons have no duty to present any such competitive opportunity to us. To the extent that any Identified Person engages in any of the foregoing actions, they may have differing interests than our other stockholders.

We are a holding company, and our principal assets are equity interests in our subsidiaries and, accordingly, we are dependent upon distributions from our subsidiaries to pay taxes and other expenses.

We are a holding company, and our principal assets are our ownership interests in our subsidiaries. We do not have independent means of generating revenue. Each of our subsidiaries is a distinct legal entity, and under certain circumstances legal and contractual restrictions may limit our ability to obtain cash from such subsidiaries. In the future, it is possible that lack of cash flow from operating activities could impact our ability to fund our debt service obligations. The deterioration of the earnings from, or other available assets of, our subsidiaries for any reason could also limit or impair such subsidiaries’ ability to pay us dividends or other distributions.