Alliance Entertainment FY26 revenue up 8%
AENT grew revenue, margins and non-GAAP earnings in fiscal 2026, but GAAP profit fell and operating cash flow turned negative amid higher working-capital investment.
Rhea-AI Filing Summary
Alliance Entertainment Holding Corp (AENT) reported fiscal 2026 results showing solid top-line and profitability growth but weaker GAAP earnings and cash generation. Net revenues increased 8% to $1.15 billion, driven by higher physical music, movie and collectibles sales. Gross profit rose 15% to $152.3 million, with gross margin expanding to 13.3% from 12.5%. However, GAAP net income declined to $13.1 million from $15.1 million, pressured by a $7.8 million non-cash write-off of a historical vendor rebate receivable. Adjusted EBITDA increased 14% to $41.5 million, while adjusted net income rose 24% to $23.4 million and adjusted diluted EPS to $0.46. Operating cash flow was a $1.7 million use of cash versus $26.8 million provided in fiscal 2025, mainly due to higher inventory and receivables as working capital increased to $62.4 million. Alliance ended the year with $74.3 million outstanding under a $120 million revolver and $45.7 million of remaining availability, and benefited from a lower average effective interest rate of 6.1% versus 9.2% after refinancing.
Positive
- Revenue grew 8% to $1.15 billion, with broad-based strength across vinyl, CDs, physical movies and collectibles, supporting scale in its entertainment and collectibles platform.
- Gross margin expanded to 13.3%, lifting gross profit 15% to $152.3 million and helping drive a 14% increase in adjusted EBITDA to $41.5 million.
- Adjusted net income rose 24% to $23.4 million and adjusted diluted EPS increased 24% to $0.46, indicating improved underlying earnings power despite one-time charges.
- Interest expense decreased 28% to $7.6 million as the average effective interest rate fell to 6.1% from 9.2% following refinancing, easing the debt service burden.
Negative
- GAAP net income declined to $13.1 million from $15.1 million, hurt by a $7.8 million non-cash write-off of a historical vendor rebate receivable.
- Operating cash flow swung to a $1.7 million use of cash from $26.8 million provided in fiscal 2025, as inventory and receivables grew faster than the 8% revenue increase.
- Working capital increased to $62.4 million from $45.4 million and revolver borrowings rose to $74.3 million from $55.3 million, reflecting greater balance-sheet investment and higher leverage.
- Net income per diluted share fell to $0.26 from $0.30, showing that reported earnings to common shareholders declined year over year.
Filing Explained
Year-end cash was $814,000, while $45.7 million remained available and another $50 million was only conditional.
The September 10 Form 8-K reports fiscal 2026 results through
The release describes liquidity as “solid,” but the reported cash balance equals 8.2 days of the latest quarterly operating cash use, and the additional
The company also reports compliance with applicable covenants at year-end and repayment of
Sources and calculations
- Alliance Entertainment Form 8-K and attached fiscal 2026 results release (2026-09-10)
- Alliance Entertainment latest quarterly fundamentals (2026Q4)
- Available liquidity against the last reported quarterly operating outflow, in days at that rate $814,000 / ($9,029,000 / 91) = 8.2 days
8-K Event Classification
Key Figures
Key Terms
Adjusted EBITDA financial
Non-GAAP Financial Measures financial
revolving credit facility financial
working capital financial
vendor rebate receivable financial
NFC-enabled authentication technical
Earnings Snapshot
FAQ
How did AENT’s revenue perform in fiscal 2026?
What were AENT’s earnings and margins for fiscal 2026?
How did AENT’s non-GAAP results change in fiscal 2026?
What happened to AENT’s operating cash flow and working capital?
What is AENT’s debt and liquidity position under its revolving credit facility?
How did key product categories perform for AENT in fiscal 2026?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date
of Report (Date of earliest event reported):
(Exact Name of Registrant as Specified in its Charter)
| (State or Other Jurisdiction | (Commission | (IRS Employer | ||
| of Incorporation) | File Number) | Identification No.) |
(Address of Principal Executive Offices) (Zip Code)
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e 4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On September 10, 2026, Alliance Entertainment Holding Corporation, a Delaware corporation (the “Company” or “Alliance”), issued a press release regarding Alliance’s financial results for the fiscal year ended June 30, 2026. A copy of the press release is attached hereto as Exhibit 99.1.
The information set forth in this Item 2.02, including the exhibit attached hereto, shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise be subject to the liabilities of that section, nor shall they be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act.
Item 7.01. Regulation FD Disclosure.
An updated version of an investor presentation of the Company is attached as Exhibit 99.2 to this Current Report on Form 8-K. The presentation will be accessible online through the Investor Relations section of the Company’s website, located at ir.aent.com, under the heading “Investor Presentation.” The information on the Company’s website is not a part of this Current Report on Form 8-K.
The information set forth in this Item 7.01, including the exhibit attached hereto, shall not be deemed to be filed for purposes of Section 18 of the Exchange Act, or otherwise be subject to the liabilities of that section, nor shall they be deemed to be incorporated by reference in any filing under the Securities Act or the Exchange Act.
Forward-Looking Statements
This Current Report on Form 8-K includes certain statements that are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. These statements are based on various assumptions, whether or not identified in this Current Report on Form 8-K, and on the current expectations of the Company’s management and are not predictions of actual performance. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. These forward-looking statements are subject to a number of risks and uncertainties, including those factors discussed in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on September 10, 2026 under the heading “Risk Factors,” and other documents of the Company filed, or to be filed, with the SEC, which are accessible through the Investor Relations section of the Company’s website at ir.aent.com. If the risks materialize or assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. The Company disclaims any obligation to update any forward-looking statements.
Item 9.01. Financial Statements and Exhibits.
| (d) | Exhibits. |
| Exhibit No. | Exhibit | |
| 99.1 | Press Release dated September 10, 2026. | |
| 99.2 | Investor Presentation. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: September 10, 2026 | ALLIANCE ENTERTAINMENT HOLDING CORPORATION | |
| By: | /s/ Bruce Ogilvie | |
| Name: | Bruce Ogilvie | |
| Title: | Executive Chairman | |
Exhibit 99.1
Alliance Entertainment Reports Fiscal 2026 Revenue Up 8% to $1.15 Billion; Gross Margin Expands 80 Basis Points to 13.3%
GAAP net income was $13.1 million, or $0.26 per diluted share; adjusted EBITDA increased 14% to $41.5 million; adjusted net income rose 24% to $23.4 million and adjusted diluted EPS increased 24% to $0.46
Vinyl revenue increases 13% to $383 million; CD revenue rises 25% to $156 million
Physical movie revenue increases 22% as relationships with Paramount and Amazon MGM Studios reinforce Alliance’s position as a scaled physical entertainment distribution partner
Collectibles revenue increases 45% as Alliance expands its portfolio of higher-value, premium and proprietary products
PLANTATION, Fla., September 10, 2026 (GLOBE NEWSWIRE) — Alliance Entertainment Holding Corporation (Nasdaq: AENT), a scaled entertainment commerce and collectibles platform serving content owners, brands, retailers and fans across music, movies, gaming, licensed merchandise and collectibles, with proprietary brands, authentication technology and reach across more than 35,000 retail and e-commerce storefronts, reported its financial and operational results for its fiscal year ended June 30, 2026.
Fiscal 2026 Financial Highlights
| ● | Net Revenues: Increased 8% to $1.149 billion, compared with $1.063 billion in fiscal 2025. | |
| ● | Gross Profit and Margin: Gross profit increased 15% to $152.3 million from $132.9 million, while gross margin expanded 80 basis points to 13.3% from 12.5%. | |
| ● | GAAP Results: Operating income was $27.2 million and net income was $13.1 million, compared with $30.1 million and $15.1 million, respectively. Fiscal 2026 included a $7.8 million non-cash write-off of a historical vendor rebate receivable. | |
| ● | Adjusted EBITDA: Increased 14% to $41.5 million, compared with $36.5 million in fiscal 2025. | |
| ● | Adjusted Net Income and Adjusted Diluted EPS: Adjusted net income increased 24% to $23.4 million, compared with $18.9 million in fiscal 2025, while adjusted diluted earnings per share increased 24% to $0.46 from $0.37. | |
| ● | Interest Expense: Decreased 28% to $7.6 million from $10.6 million, reflecting a lower average effective interest rate following the Company’s refinancing. | |
| ● | Cash Flow and Liquidity: Net cash used in operating activities was $1.7 million, compared with $26.8 million of net cash provided in fiscal 2025, primarily reflecting increased inventory and receivables to support growth. The Company ended fiscal 2026 with $45.7 million of availability under its $120 million revolving credit facility. |
“Fiscal 2026 demonstrated that the strategy we have been executing is strengthening both the quality of our business and our position across the entertainment ecosystem,” said Jeff Walker, Chief Executive Officer of Alliance Entertainment. “The market for physical entertainment continues to evolve toward premium formats, collectible products and more specialized distribution, and those changes are playing directly to the capabilities we have built over more than three decades. Our expanding relationships with major content owners, including Paramount and Amazon MGM Studios, reinforce the value of our scale, infrastructure, and ability to manage increasingly complex physical entertainment programs across wholesale, retail, and e-commerce channels.”
“Our opportunity is increasingly broader than traditional distribution,” Walker continued. “We are using the same infrastructure and relationships that support our core business to expand into higher-value collectibles, proprietary products, fulfillment services and new capabilities such as authentication and digital product identity. Our focus is not simply on putting more volume through the platform, but on improving the value and economics of what moves through it. As the entertainment market becomes more specialized and content owners and retailers look for scaled partners that can manage that complexity, we believe Alliance is increasingly well positioned to capture those opportunities and create durable long-term value.”
“Fiscal 2026 was a year of strong execution for Alliance Entertainment,” said Amanda Gnecco, Chief Financial Officer of Alliance Entertainment. “We expanded gross margins, grew gross profit faster than revenue and delivered growth in adjusted EBITDA, adjusted net income and adjusted diluted earnings per share. These results demonstrate the progress we’ve made in strengthening the earnings profile of the business while continuing to invest in the products, capabilities and partnerships that support our long-term growth strategy.”
“Looking ahead to fiscal 2027, we are excited about the opportunities in front of us,” Gnecco added. “Our focus remains on driving profitable growth, improving cash generation and increasing operating leverage as we continue to scale the business. Combined with lower borrowing costs, solid liquidity and continued investment in automation and technology, we believe we are well positioned to deliver continued value for our customers, partners and shareholders.”
Strategic & Operating Highlights
| ● | Physical Music Demand Remained Strong Across Formats: Vinyl revenue increased 13% to $383 million, while CD revenue increased 25% to $156 million. Growth across both formats reflects sustained consumer demand for physical ownership, premium editions and collectible-oriented releases, reinforcing the durability of physical music as an important part of Alliance’s portfolio. | |
| ● | Home Entertainment Growth Reinforced Alliance’s Strategic Position with Major Studios: Physical movie revenue increased 22% to $339 million, supported by higher unit volumes and the Company’s expanding studio relationships. Alliance’s exclusive physical-media distribution relationship with Paramount and the addition of Amazon MGM Studios during fiscal 2026 further strengthen the Company’s role as a scaled partner for content owners seeking to manage physical entertainment distribution across wholesale, retail and e-commerce channels. | |
| ● | Collectibles Continued to Expand as a Higher-Value Growth Category: Collectibles revenue increased 45% to $32 million, supported by higher average selling prices, expanded licensed merchandise offerings and continued development of proprietary products. The Company is leveraging its existing entertainment relationships and distribution infrastructure to broaden its participation in premium fan and collector categories, including through its owned Handmade by Robots™ brand. |
| ● | Fulfillment Growth and Automation Investments Enhanced Platform Scalability: Distribution and fulfillment fee revenue increased 26% to $18.6 million as Alliance continued to expand its role as an omnichannel logistics and fulfillment partner. During fiscal 2026, the Company ordered 5,000 additional totes for its AutoStore system, increasing capacity to 57,000 totes and supporting higher throughput while maintaining fulfillment labor efficiency. | |
| ● | Authentication and Digital Identity Expanded Alliance’s Platform Capabilities: Following the acquisition and integration of Endstate, Alliance continued developing NFC-enabled authentication and digital product identity capabilities through Endstate Authentic and Alliance Authentic™. These initiatives are designed to extend the Company’s participation beyond initial product distribution into areas such as authenticated ownership, provenance, brand protection and resale, creating additional long-term opportunities across premium physical products and collectibles. |
Fiscal 2026 Financial Review
The improvement in gross margin during fiscal 2026 reflected stronger margins in physical movies and collectibles, increased contribution from premium and exclusive content, favorable product mix and returns activity, and lower wholesale freight costs as a percentage of sales. A portion of the increase in gross profit was offset by higher selling, general and administrative expenses, which increased to $66.0 million from $56.0 million, primarily reflecting higher payroll and employee-related costs to support growth, as well as increased consulting and professional-service costs associated with strategic initiatives and public-company operations. Fiscal 2026 also included a $7.8 million non-cash write-off of a historical vendor rebate receivable associated with Tastemakers following the counterparty’s cessation of operations. The Company does not consider this charge representative of its ongoing operating performance.
Operating cash flow in fiscal 2026 was principally affected by increased working-capital investment to support the Company’s higher revenue base and anticipated customer demand. Working capital increased to $62.4 million at June 30, 2026, from $45.4 million a year earlier. Inventory and trade receivables increased at rates above the Company’s 8% revenue growth during the year, contributing to the year-over-year decline in operating cash flow. In fiscal 2027, management’s objective is to convert a greater share of earnings into operating cash flow by moderating working-capital growth relative to revenue, increasing inventory productivity and strengthening receivable collections.
The Company benefited from lower borrowing costs during fiscal 2026, with its average effective interest rate declining to 6.1% from 9.2% following its refinancing with Bank of America in October 2025. The Company had $74.3 million outstanding under its $120 million revolving credit facility, with $45.7 million of remaining availability, The facility also provides, subject to certain conditions and lender consent, for up to $50 million of additional borrowing capacity, providing further potential financial flexibility as the business grows. The Company was in compliance with applicable covenants at year-end. During fiscal 2026, the Company also repaid $10.0 million of related-party borrowings, further simplifying its financing structure.
Conference Call
Alliance Entertainment Chief Executive Officer Jeff Walker, Chief Financial Officer Amanda Gnecco, and Executive Chairman Bruce Ogilvie will host the conference call, which will be followed by a question-and-answer session. A presentation will accompany the call and can be viewed during the webcast or accessed via the investor relations section of the Company’s website here.
To access the call, please use the following information:
| Date: | Thursday, September 10, 2026 |
| Time: | 4:30 p.m. Eastern Time, 1:30 p.m. Pacific Time |
| Toll-free dial-in number: | 1-877-407-0784 |
| International dial-in number: | 1-201-689-8560 |
| Conference ID: | 13762431 |
Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact RedChip Companies at 1-407-644-4256.
The conference call will be broadcast live and available for replay at https://viavid.webcasts.com/starthere.jsp?ei=1774079&tp_key=92e32c8d84 and via the investor relations section of the Company’s website here.
A telephone replay of the call will be available approximately three hours after the call concludes and can be accessed through October 10, 2026, using the following information:
| Toll-free replay number: | 1-844-512-2921 |
| International replay number: | 1-412-317-6671 |
| Replay ID: | 13762431 |
About Alliance Entertainment
Alliance Entertainment (NASDAQ: AENT) is a scaled entertainment commerce and collectibles platform serving content owners, brands, retailers and fans across music, movies, gaming, licensed merchandise and collectibles. The Company also owns and develops proprietary brands and platforms, including Handmade by Robots™ and Alliance Authentic™, while Endstate Authentic adds NFC-enabled authentication and digital product identity capabilities supporting provenance, brand protection and authenticated resale. Leveraging decades of industry relationships and distribution, fulfillment and inventory-management expertise, Alliance reaches more than 35,000 retail and e-commerce storefronts, connecting entertainment franchises and collectible products with consumers across channels and generations.
For more information, visit www.aent.com.
Forward Looking Statements
Certain statements included in this Press Release that are not historical facts are forward-looking statements for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by words such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “should,” “would,” “plan,” “predict,” “potential,” “seem,” “seek,” “future,” “outlook,” and similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, statements regarding estimates and forecasts of other financial and performance metrics and projections of market opportunity. These statements are based on various assumptions, whether identified in this Press Release, and on the current expectations of Alliance’s management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as and must not be relied on by an investor as, a guarantee, an assurance, a prediction, or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of Alliance. These forward-looking statements are subject to a number of risks and uncertainties, including risks relating to the anticipated growth rates and market opportunities; changes in applicable laws or regulations; the ability of Alliance to execute its business model, including market acceptance of its systems and related services; Alliance’s reliance on a concentration of suppliers for its products and services; increases in Alliance’s costs, disruption of supply, or shortage of products and materials; Alliance’s dependence on a concentration of customers, and failure to add new customers or expand sales to Alliance’s existing customers; increased Alliance inventory and risk of obsolescence; Alliance’s significant amount of indebtedness; our ability to refinance our existing indebtedness; risks that a breach of the revolving credit facility could result in the lender declaring a default and that the full outstanding amount under the revolving credit facility could be immediately due in full, which would have severe adverse consequences for the Company; known or future litigation and regulatory enforcement risks, including the diversion of time and attention and the additional costs and demands on Alliance’s resources; Alliance’s business being adversely affected by increased inflation, uncertainty regarding tariffs, higher interest rates and other adverse economic, business, and/or competitive factors; geopolitical risk and changes in applicable laws or regulations; as well as our financial condition and results of operations; substantial regulations, which are evolving, and unfavorable changes or failure by Alliance to comply with these regulations; product liability claims, which could harm Alliance’s financial condition and liquidity if Alliance is not able to successfully defend or insure against such claims; availability of additional capital to support business growth; and the inability of Alliance to develop and maintain effective internal controls.
For investor inquiries, please contact:
Dave Gentry
RedChip Companies, Inc.
1-800-REDCHIP (733-2447)
1-407-644-4256
AENT@redchip.com
ALLIANCE ENTERTAINMENT HOLDING CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
| Year Ended | Year Ended | |||||||
| ($ in thousands except share and per share amounts) | June 30, 2026 | June 30, 2025 | ||||||
| Net Revenues | $ | 1,148,986 | $ | 1,063,457 | ||||
| Cost of Revenues (excluding depreciation and amortization) | 996,662 | 930,605 | ||||||
| Operating Expenses | ||||||||
| Distribution and Fulfillment Expense | 44,960 | 40,375 | ||||||
| Selling, General and Administrative Expense | 66,169 | 55,992 | ||||||
| Depreciation and Amortization | 5,359 | 5,334 | ||||||
| Loss on Vendor Receivable | 7,823 | |||||||
| Transaction Costs | 1,213 | 957 | ||||||
| Insurance Claim Recovery | (395 | ) | - | |||||
| Restructuring Cost | - | 73 | ||||||
| Gain on Disposal of Fixed Assets | (24 | ) | (15 | ) | ||||
| Total Operating Expenses | 125,105 | 102,716 | ||||||
| Operating Income | 27,219 | 30,136 | ||||||
| Other Expenses | ||||||||
| Interest Expense | 7,606 | 10,575 | ||||||
| State tax Benefit from prior year | (51 | ) | ||||||
| Change in Fair Value of Warrants | 850 | 853 | ||||||
| Total Other Expenses | 8,405 | 11,428 | ||||||
| Income Before Income Tax Expense | 18,814 | 18,708 | ||||||
| Income Tax Expense | 5,756 | 3,630 | ||||||
| Net Income | 13,058 | 15,078 | ||||||
| Other Comprehensive Income (Loss) | ||||||||
| Foreign Currency Translation | (1 | ) | 3 | |||||
| Total Comprehensive Income | 13,057 | 15,081 | ||||||
| Net Income per Share – Basic | $ | 0.26 | $ | 0.30 | ||||
| Weighted Average Common Shares Outstanding - Basic | 50,963,975 | 50,957,370 | ||||||
| Net Income per Share – Diluted | 0.26 | 0.30 | ||||||
| Weighted Average Common Shares Outstanding - Diluted | 51,051,740 | 51,016,546 | ||||||
ALLIANCE ENTERTAINMENT HOLDING CORP.
CONSOLIDATED BALANCE SHEETS
| ($ in thousands, except per share amounts) | June 30, 2026 | June 30, 2025 | ||||||
| Assets | ||||||||
| Current Assets | ||||||||
| Cash | $ | 814 | $ | 1,236 | ||||
| Trade Receivables, Net of Allowance for Credit Losses of $811 and $867, respectively | 111,038 | 95,027 | ||||||
| Inventory, Net | 126,599 | 102,848 | ||||||
| Other Current Assets | 9,843 | 19,021 | ||||||
| Total Current Assets | 248,294 | 218,132 | ||||||
| Property and Equipment, Net | 10,564 | 11,291 | ||||||
| Operating Lease Right-Of-Use Assets, Net | 16,062 | 19,214 | ||||||
| Goodwill | 94,081 | 89,116 | ||||||
| Intangibles, Net | 18,457 | 18,475 | ||||||
| Other Long-Term Assets | 9,932 | 789 | ||||||
| Deferred Tax Asset, Net | 210 | 4,211 | ||||||
| Total Assets | $ | 397,600 | $ | 361,228 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current Liabilities | ||||||||
| Accounts Payable | $ | 170,958 | $ | 155,300 | ||||
| Accrued Expenses | 8,361 | 9,548 | ||||||
| Current Portion of Operating Lease Obligations | 3,329 | 3,229 | ||||||
| Current Portion of Finance Lease Obligations | 1,937 | 3,075 | ||||||
| Deferred Consideration | 1,300 | - | ||||||
| Contingent Liability | - | 1,577 | ||||||
| Total Current Liabilities | 185,885 | 172,729 | ||||||
| Revolving Credit Facility, Net | 73,721 | 55,268 | ||||||
| Finance Lease Obligation, Non- Current | - | 1,931 | ||||||
| Operating Lease Obligations, Non-Current | 14,217 | 17,432 | ||||||
| Shareholder Loan (subordinated), Non-Current | - | 10,000 | ||||||
| Contingent Liability, Non-Current | 5,500 | - | ||||||
| Acquired Royalty Obligation (Endstate), Non-Current | 165 | - | ||||||
| Warrant Liability | 1,496 | 646 | ||||||
| Total Liabilities | 280,984 | 258,006 | ||||||
| Commitments and Contingencies (Note 12) | ||||||||
| Stockholders’ Equity | ||||||||
| Preferred Stock: Par Value $0.0001 per share, Authorized 1,000,000 shares, Issued and Outstanding 0 shares as of June 30, 2026 and June 30, 2025 | - | - | ||||||
| Common Stock: Par Value $0.0001 per share, Authorized 550,000,000 shares at June 30, 2026, and at June 30, 2025; Issued and Outstanding 50,979,630 shares at June 30, 2026, and 50,957,370 at June 30, 2025, respectively | 5 | 5 | ||||||
| Paid In Capital | 48,907 | 48,570 | ||||||
| Accumulated Other Comprehensive Loss | (77 | ) | (76 | ) | ||||
| Retained Earnings | 67,781 | 54,723 | ||||||
| Total Stockholders’ Equity | 116,616 | 103,222 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 397,600 | $ | 361,228 | ||||
ALLIANCE ENTERTAINMENT HOLDING CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
| Year Ended | Year Ended | |||||||
| ($ in thousands) | June 30, 2026 | June 30, 2025 | ||||||
| Cash Flows from Operating Activities: | ||||||||
| Net Income | $ | 13,058 | $ | 15,078 | ||||
| Adjustments to Reconcile Net Income to | ||||||||
| Net Cash Provided by Operating Activities: | ||||||||
| Depreciation of Property and Equipment | 1,793 | 1,828 | ||||||
| Amortization of Intangible Assets | 3,567 | 3,506 | ||||||
| Amortization of Deferred Financing Costs (Included in Interest Expense) | 2,086 | 1,404 | ||||||
| Allowance for Credit Losses | 1,445 | 1,068 | ||||||
| Change in Fair Value of Warrants | 850 | 853 | ||||||
| Deferred Income Taxes | 4,001 | 2,322 | ||||||
| Non-cash lease expense | 3,152 | 2,910 | ||||||
| Stock-based Compensation Expense | 337 | 58 | ||||||
| Gain on Disposal of Fixed Assets | (24 | ) | (15 | ) | ||||
| Changes in Assets and Liabilities | ||||||||
| Trade Receivables | (17,455 | ) | (6,080 | ) | ||||
| Inventory | (23,751 | ) | (4,665 | ) | ||||
| Income Taxes Receivable | (600 | ) | (384 | ) | ||||
| Operating Lease Obligations | (3,115 | ) | (1,731 | ) | ||||
| Other Assets | 462 | (11,340 | ) | |||||
| Accounts Payable | 15,658 | 22,079 | ||||||
| Accrued Expenses and Contingent Liability | (3,164 | ) | (82 | ) | ||||
| Net Cash (Used In) Provided By Operating Activities | (1,700 | ) | $ | 26,809 | ||||
| Cash Flows from Investing Activities: | ||||||||
| Capital Expenditures | (1,074 | ) | (54 | ) | ||||
| Cash Inflow from Asset Disposal | 30 | 15 | ||||||
| Investment in Captive Stock (Equity Component) | 173 | - | ||||||
| Cash Paid for Business Acquisition/Asset Purchase | (1,150 | ) | (7,595 | ) | ||||
| Cash Paid for Contract | - | (500 | ) | |||||
| Net Cash Used in Investing Activities | (2,021 | ) | (8,134 | ) | ||||
| Cash Flows from Financing Activities: | ||||||||
| Payments on Financing Leases | (3,069 | ) | (2,848 | ) | ||||
| Payments on Revolving Credit Facility | (1,142,898 | ) | (986,132 | ) | ||||
| Borrowings on Revolving Credit Facility | 1,159,913 | 970,409 | ||||||
| Payments on Shareholder Note (Subordinated), Current | (10,000 | ) | - | |||||
| Deferred Financing Costs | (646 | ) | - | |||||
| Net Cash Provided By (Used In) Financing Activities | 3,300 | (18,571 | ) | |||||
| Net (Decrease)/Increase in Cash | (421 | ) | 104 | |||||
| Net Effect of Currency Translation on Cash | (1 | ) | 3 | |||||
| Cash, Beginning of the Year | 1,236 | 1,129 | ||||||
| Cash, End of the Year | $ | 814 | $ | 1,236 | ||||
| Supplemental disclosure for Cash Flow Information | ||||||||
| Cash Paid for Interest | $ | 7,530 | $ | 9,171 | ||||
| Cash Paid for Income Taxes | $ | 2,452 | $ | 1,727 | ||||
| Supplemental Disclosure for Non-Cash Investing and Financing Activities | ||||||||
| Conversion of Warrants from liability to Equity | $ | - | 454 | |||||
| Contract Acquisition | $ | - | 1,800 | |||||
Non-GAAP Financial Measures: EBITDA, Adjusted EBITDA, Adjusted Net Income, and Adjusted Earnings per Diluted Share (collectively, the “Non-GAAP Financial Measures”) are supplemental measures of our performance that are not required by, or presented in accordance with, U.S. GAAP. The Non-GAAP Financial Measures are not measurements of our financial performance under U.S. GAAP and should not be considered as alternatives to net income, earnings per share or any other performance measure derived in accordance with U.S. GAAP. We define EBITDA as net income before interest expense, net, income tax expense, depreciation and amortization. We define Adjusted EBITDA as EBITDA further adjusted for non-cash charges related to equity-based compensation programs, acquisition and deal-related costs, changes in the fair value of warrants and vendor transaction loss, insurance claim recoveries, and restructuring costs and net gains and losses on the disposal of assets. We define Adjusted Net Income as net income adjusted for the impact of certain non-cash charges and other items that we do not consider in our evaluation of ongoing operating performance. These items include, among other things, non-cash charges related to equity-based compensation programs, acquisition and deal-related costs, amortization of acquisition-related intangible assets, amortization of deferred financing costs, changes in the fair value of warrants and litigation costs and settlements, regulatory assessments and insurance settlements, and the income tax expense effect of these adjustments. We define Adjusted Earnings per Diluted Share as Adjusted Net Income divided by the weighted-average shares outstanding used in the calculation of diluted earnings per share in accordance with U.S. GAAP.
We caution investors that amounts presented in accordance with our definitions of the Non-GAAP Financial Measures may not be comparable to similar measures disclosed by our competitors, because not all companies and analysts calculate the Non-GAAP Financial Measures in the same manner. We present the Non-GAAP Financial Measures because we consider them to be important supplemental measures of our performance and believe they are frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry. Management believes that investors’ understanding of our performance is enhanced by including these Non-GAAP Financial Measures as a reasonable basis for comparing our ongoing results of operations.
The following tables reconcile the Non-GAAP Financial Measures to the most directly comparable U.S. GAAP financial performance measure, which is net income, for the years presented:
| Year Ended | Year Ended | |||||||
| (in thousands, except share and per share data) | June 30, 2026 | June 30, 2025 | ||||||
| Net income | $ | 13,058 | $ | 15,078 | ||||
| Equity-based compensation (1) | 337 | 58 | ||||||
| Acquisition and deal-related costs (2) | 1,213 | 957 | ||||||
| Amortization of acquisition-related intangible assets (3) | 390 | 180 | ||||||
| Amortization of deferred financing costs (4) | 2,086 | 1,404 | ||||||
| Change in fair value of warrants and contingent consideration (5) | 850 | 853 | ||||||
| Loss on Vendor Receivable (6) | 7,823 | - | ||||||
| Litigation costs and settlements (7) | 1,267 | 1,424 | ||||||
| Insurance Claim Recovery (8) | (395 | ) | — | |||||
| Income tax effect of adjustments (9) | (3,180 | ) | (1,006 | ) | ||||
| Adjusted net income | $ | 23,449 | $ | 18,948 | ||||
| Weighted-average shares outstanding—basic | 50,963,975 | 50,957,370 | ||||||
| Effect of dilutive securities | 87,765 | 8,600 | ||||||
| Weighted-average shares outstanding—diluted | 51,051,740 | 50,965,970 | ||||||
| Earnings per diluted share | $ | 0.26 | $ | 0.30 | ||||
| Adjusted earnings per diluted share | $ | 0.46 | $ | 0.37 | ||||
| ($ in thousands) | Year Ended June 30, 2026 | Year Ended June 30, 2025 | ||||||
| Net income | $ | 13,058 | $ | 15,078 | ||||
| Add back: | ||||||||
| Interest expense, net | 7,606 | 10,575 | ||||||
| Income tax expense | 5,756 | 3,630 | ||||||
| Depreciation and amortization (10) | 5,359 | 5,334 | ||||||
| EBITDA | 31,779 | 34,617 | ||||||
| Adjustments: | ||||||||
| Acquisition and deal-related costs (2) | 1,213 | 957 | ||||||
| Restructuring costs (11) | — | 73 | ||||||
| Loss on vendor receivable (6) | 7,823 | — | ||||||
| Equity-based compensation (1) | 337 | 58 | ||||||
| Change in fair value of warrants and contingent consideration (5) | 850 | 853 | ||||||
| Insurance claim recovery (8) | (395 | ) | — | |||||
| State tax benefit from Prior Year (13) | (51 | ) | - | |||||
| Gain on disposal of property and equipment (12) | (24 | ) | (15 | ) | ||||
| Adjusted EBITDA | $ | 41,532 | $ | 36,543 | ||||
(1) Represents non-cash charges related to equity-based compensation programs, which vary from period to period depending on the timing of awards.
(2) Represents costs incurred in connection with completed and contemplated business combinations, including advisory, legal, accounting and other professional fees.
(3) Represents amortization of intangible assets acquired in business combinations. The revenue generated by those intangible assets is not excluded from the Non-GAAP Financial Measures.
(4) Represents amortization of debt issuance costs incurred in connection with our credit facility with Bank of America and the terminated White Oak Credit Facility.
(5) Represents non-cash gains and losses resulting from the remeasurement of warrant liabilities and contingent consideration to fair value at each reporting date.
(6) Represents a loss recognized on a receivable due from a vendor for rebates owed before the company went out of business.
(7) Represents legal fees, settlement amounts and other costs associated with litigation matters that we do not consider indicative of our ongoing operating performance.
(8) Represents recoveries received under insurance claims
(9) Represents the income tax effect of the above adjustments. This adjustment uses a blended federal and state statutory income tax rate of 25% for all periods presented and is applied only to those adjustments that carry an income tax consequence. Changes in the fair value of warrants and contingent consideration are not deductible for income tax purposes and accordingly have not been tax effected.
(10) Represents total depreciation and amortization determined in accordance with U.S. GAAP, which includes amortization of acquisition-related intangible assets. Accordingly, no separate adjustment for that amortization is presented in the reconciliation of EBITDA to Adjusted EBITDA.
(11) Represents restructuring costs.
(12) Represents net gains and losses on the disposal of property and equipment.
(13) State Tax refund for abandoned property
Exhibit 99.2
Filing Exhibits & Attachments
39 documentsPress Releases
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