MKTW 10-K & 10-Q changes, risk factors and insider trading

The risks described below reflect our beliefs and opinions as to factors that could hurt our business, financial condition, or operating results.results in the future. Although it is not possible to predict or identify all such risks and uncertainties, they may include the factors discussed below. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that challenge our business or results of operationsoperations. References to past events are provided by way of example only and are not intended to be a complete listing or a representation as to whether or not such factors have occurred in the past or their likelihood of occurring in the future.

To increase our revenue and maintain profitability, we must attract new subscribers, retain existing subscribers, and expand the subscriptions of current customers. Our ability to do so depends in part on the quality of theour content, including the performance of the investment research we publish. If the performance of such research falls short of our subscribers’ expectations, our ability to attract and retain subscribers will decline.

Many of our subscribers initially register for subscriptions to our free products and services. We strive to demonstrate the value of our free products to our subscribers, thereby encouraging them to convert to paying subscribers. As of December 31, 2024,2025, we had approximately 152 million total subscribers, of which approximately 506374 thousand were payingPaid subscribers.Subscribers. The actual number of unique subscribers may be lower than we report as one person could count as multiple,multiple activeActive subscribersFree Subscribers or payingPaid subscribers.Subscribers. As a result, we may have fewer unique subscribers that we may be able to convert, upsell or cross-sell. Our inability to determine the number of our unique subscribers is a limitation in the data that we measure and may adversely affect our understanding of certain aspects of our business and make it more challenging to manage our business. Most of our activeActive subscribersFree Subscribers never convert to a payingPaid subscribers,Subscribers, and if we are unable to convert a sufficient number of freeActive subscribersFree Subscribers to payingPaid subscribers,Subscribers, our business, results of operations and financial condition could suffer.

If we are unable to cost-effectively use social media platforms or ad networks as marketing tools, our ability to acquire new subscribers and our financial condition may suffer. Unauthorized or inappropriate use of our social media channels could result in harmful publicity or negative customer experiences, which could undermine our marketing in these channels. In addition, substantial negative commentary by others on social media platforms could have hinder our ability to successfully connect with consumers.

Inefficient or ineffective promotion of our content could prevent us from maintainmaintaining and growing our subscriber base, which would harm our business, results of operations, and financial condition.

We believe our portfolio of brands are highly regarded because of the integrity of their editorial content. Independence is at the core of our brands and business, and we believe that the reputation of our company and our brands is one of our greatest assets. Importantly, we believe that one of our greatest competitive advantages is the loyalty that we have gained from our subscribers as a direct result of our brand, reputation for integrity, and ability to deliver high-quality products and services. To protect our brands, our corporate policies, codes of conduct, and workplace culture demand that all of our content providers, whether employees or outside contributors, adhere to rigorous standards of integrity and independence. Our internal guidelines are designed to prevent any actual, potential, or perceived conflict of interest, and ensure we comply with all applicable laws, including securities laws. The occurrence of events such as our misreporting a market event, the non-disclosure of a security ownership position by one or more of our content providers, the manipulation of a security by one or more of our content providers, or any other breach of our compliance policies could harm our reputation for trustworthiness and reduce our subscriber base. Despite our rigorous standards of integrity and independence, we have experienced instances where our content providers have not lived up to these standards and have breached our compliance policies. These events can damage our reputation for trustworthiness and independence, and may have an adverse effect on our business, results or operations, and financial condition. For example, inwe February 2024, wehave terminated a content providerproviders for violations ofviolating our corporate policies and announcedclosed aoperating wind-downbusinesses because of the operationsreputational ofharm Legacycaused Research.by Seesuch Notepolicy 4 – Legacy Reorganization to our consolidated financial statements included elsewhere in this annual report.violations.

Any harm to the reputation of any of our current or former directors, officers, key contributors, editors, or staff could adversely affect us as a resultbecause of our association with such individual. In particular, ourOur operating brands depend heavily on the ideas and reputation of their editors and editorial teams, and often name products and operating companies after members of those editorial teams. Our editors and editorial team members have,have in the past been, and continue to be,been the subject of regulatory actions, accusations, claims, investigations, lawsuits, and/or settlements, which may have orhad and may continue to damagehave a negative impact to our reputation, subscriber base, and financial results. For example, in February 2024, a former employee was charged by the U.S. Attorney’s Office for the Central District of California with touting securities for undisclosed compensation and conspiracy to tout securities for undisclosed compensation, following 2022 charges brought by the SEC against the same individual. The Company has not been charged by the U.S. Attorney's Office or the SEC.

Adverse or weakened conditions in the financial sector, global financial markets, and the broader global economyeconomy, trade policies, and geopolitical events may impact our results.business, financial conditions and results of operations.

GeneralOur performance is influenced by general economic trendstrends, political and regulatory developments, and the performanceoverall stability and functioning of financial markets influence our business results.markets. Global macroeconomic conditions and U.S. financial markets remain vulnerable to potentiala range of risks posed by factors such as, economic recessions, fluctuation in interest rates, rising inflation, volatility in commodity prices, foreign currency movements, trade policies and international tariffs, and broader social, political and financialeconomic uncertaintyinstability. Additional risks include actual or threatened hostilities, military conflict and acts of war, terrorism, civil unrest, uncertain in themajor Unitedglobal Stateseconomies, complications affecting global trade or travel, and Europe,geopolitical warstensions, including conflicts in the Middle East, Russia and Ukraine, concerns about China’s economy, complications involving terrorism, armed conflicts, civil unrest around the world, or other challenges to global tradetrade, orrelated travel.sanctions and other restrictive governmental actions.

Any downturn and volatility in the economy or financial markets could weakenaffect oncustomer ourconfidence businessand results,behavior, asleading customersto mayreductions becomeor cautiousdelays aboutin capital spending, discretionary purchases, and investments in data and content expenditures.solutions. Our average customers are people at or approaching retirement age who may be particularly vulnerable during economic downturns. As a result, unfavorable market or economic conditions could reduce demand for our products and services and negatively affect our revenues, cash flows, and overall financial results, including revenues and cash flow, may decline.performance.

The technology landscape has been changing at an accelerating rate over the past several years. Advances in technology have led to an increasing number of methods for delivery of content and have resulted in a wide and evolving variety of consumer demands and expectations. The increasing number of digital media options available on the Internet, through social-networking tools and throughtools, mobile applications and other devices, is expanding consumer choice significantly.

Financing an acquisition could result in dilution from issuing equity securities, reduce our financial flexibility because of reductions in our cash balance, or result in a weaker balance sheet from incurring additional debt.

We recognize revenue from subscribers ratably over the terms of their subscription agreements, which are typically one year, but can range from one month to multiple years. As a result, most of the revenue we report in each period is the result of subscription agreements entered into during prior periods. Consequently, a decline in new or renewed subscriptions in any one period may not be reflected in our revenue and operating results for that period. However, any such decline may undercut our revenue and operating results in future periods.

We intend to continue to make investments to support our business growth and may require additional funds to respond to business challenges, including the need to develop new features and products or enhance our existing services, improve our operating infrastructure, or acquire complementary businesses and products. Accordingly, we may need to raise money through equity or debt financings. Issuances of equity or convertible debt securities could dilute our existing stockholders. Any new equity securities we issue could also have rights, preferences, and privileges superior to those of holders of Class A common stock. Debt financing could involve covenants that restrict subsequent efforts to raise capital.. We may not be able to obtain additional financing on terms favorable to us, if at all. If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to continue to support our business growth and to respond to business challenges could be impaired.

If we change our business practices in such a way as to not satisfy the publisher’s exclusion, or otherwise failsfail to comply with the regulatory requirements concerning this exclusion, we may face civil and/or criminal penalties as an unregistered investment adviser or other resultsconsequences that could damage our business.

These cybersecurity incidents or other significant disruptions could be caused by persons inside our organization, persons outside our organization with authorized access to systems inside our organization, or by individuals outside our organization. . Although the cybersecurity incidents that we have experienced to date, as well as those reported to us by our third-party partners, have not had a material effect on our business, financial condition or results of operations, they could be more damaging in the future.

Our business requires that we securely collect, process, store, transmit, and dispose of confidential information relating to our operations, subscribers, employees, and other third parties. InWe particular,collect Paid Subscribers must give usSubscribers’ information (including name, mailing address, phone number, email address, and credit card information) (collectively “personal information”), which we use to administer our services. We also requirecollect the Free Subscribers (as defined below) to provide personal information, such as email addresses, during the membership registration process.. Additionally, we rely on security and authentication technology licensed from third parties to perform real-time credit card authorization and verification. At timestimes, we also rely on third parties, including technology consulting firms, to help protect our infrastructure from security threats.

Laws in countries outside of the United States create significant compliance obligations and liability. For example, the European Union General Data Protection Regulation (Regulation 2016/679) and applicable national supplementing laws and the UK data protection regime consisting primarily of the UK General Data Protection Regulation and the UK Data Protection Act 2018 (together referred to as the “GDPR”) may create an ongoing compliance commitment and substantial costs in relation to our use of personal data. Ensuring compliance with the GDPR could involve substantial costs. Despite our efforts, competent authorities or third parties willmay assert that our business practices fail to comply. If our operations are found to be in violation of the GDPR, we may be required to change our business practices and/or be subject to significant civil penalties, regulatory enforcement, business disruption, and reputational harm, any of which could have a material adverse effect on our business. If we or our vendors fail to comply with the GDPR and the EU’s national data protection laws, , we may face regulatory enforcement actions, which can result in significant monetary penalties and other administrative penalties.

We are also subject to evolving EU and UK privacy laws on cookies, tracking technologies, and e-marketing practices. Recent European court decisions and regulators’ recent decisions and guidance hashave increased attention on these technologies. If enforcement continues increasing, this could increase our liability exposure and lead to substantial costs. It could also require significant systems changes, limit the effectiveness of our marketing activities, and divert the attention of our technology personnel. Those changes could shrink our margins, increase costs, and subject us to additional liabilities. It may lead to broader restrictions and impairments on our marketing and personalization activities and hinder our efforts to understand users.

We use a broad mix of marketing programs and platforms to promote our services and content to current and prospective subscribers. Two of our primary means of communicating with our subscribers has been via email and text messages. Actual or perceived improper sending of such email or text messaging communications may subject us to liabilities or claims relating to consumer protection laws. We strive to ensure that all of our marketing communications comply with the requirements set forth in the TCPA and CAN-SPAM Act. However, any violations could result in the Federal Communications Commission (FCC) and FTC, respectively, seeking civil penalties against us. Numerous class-action suits under federal and state laws have been filed in recent years against companies who conduct email marketing, telemarketing and/or SMS texting programs. Many have resulted in multimillion-dollar settlements to the plaintiffs. Any current or future such litigation against us could be costly and time-consuming to defend.

At the same time, use of AI has recently become the source of significant media attention and political debate. The introduction of AI technologies, particularly generative AI, into new or existing offerings may result in new or expanded risks and liabilities, including due to enhanced governmental or regulatory scrutiny, litigation, compliance issues, ethical concerns, confidentiality or security risks, as well as other factors that could adversely affect our business, reputation, and financial results. For example, AI technologies can lead to unintended consequences, including generating content that appears correct but is factually inaccurate, misleading or otherwise flawed, or that results in unintended biases and discriminatory outcomes, which could harm our reputation and business and expose us to liability. We may also not identify inaccurate information, which may expose us to liability. If the content, analyses, or recommendations that AI applications assist in producing are, or are alleged to be, deficient, inaccurate, unreliable, misleading, biased, discriminatory or otherwise flawed, any of which may not be easily detectable, our business and reputation may be adversely affected. Laws, regulations or industry standards that develop in response to the use of AI may be burdensome or may significantly restrict the deployment of AI, particularly generative AI technologies, in our products or processes.

Income tax payouts are subject to volatility. Among the factors that could cause them to rise are::

Any of these factors could harm our operating results. Significant judgment is required to determine the recognition and measurement attribute prescribed in GAAP relating to accounting for income taxes. In addition, we are subject to examinations of our income tax returns by the U.S. Internal Revenue Service (the “IRS”) and other tax authorities. We assess the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of our provision for income taxes. There may be exposure that theThe outcomes from these examinations willmay have an adverse effect on our business, financial condition, and results of operations.

MarketWise, LLC is treated as a partnership for U.S. federal income tax purposes and, as such, generally will not be subject to any entity-level U.S. federal income tax. Instead, taxable income will be allocated to its equityholders,equity holders, including MarketWise, Inc. Accordingly, MarketWise, Inc. will incur income taxes on its allocable share of any net taxable income of MarketWise, LLC. Under the terms of the Third Amended and Restated Limited Liability Company Operating Agreement of MarketWise, LLC (the “MarketWise Operating Agreement”), MarketWise, LLC is obligated to make tax distributions to owners of the common units issued by MarketWise, LLC (“LLC Units”), including MarketWise, Inc. MarketWise, Inc. intends, as MarketWise, LLC’s sole manager, to cause MarketWise, LLC to make cash distributions to the owners of LLC Units in an amount sufficient to (i) fund all or part of such owners’ tax obligations in respect of taxable income allocated to such owners and (ii) cover MarketWise, Inc.’s operating expenses, including payments under the Tax Receivable Agreement. However, MarketWise, LLC’s ability to make such distributions may be subject to various limitations and restrictions, such as restrictions on distributions under contracts or agreements to which MarketWise, LLC is then a party. Additionally, any distribution that would render MarketWise, LLC insolvent would be restricted. If MarketWise, Inc. does not have sufficient funds to pay tax or other liabilities or to fund our operations, it may have to borrow funds, which could materially adversely affect its liquidity and financial condition and subject MarketWise, Inc. to various restrictions imposed by any such lenders.

As a result of (i) potential differences in the amount of net taxable income allocable to the MarketWise Members, (ii) the lower tax rates currently applicable to corporations as opposed to individuals, and (iii) the favorable tax benefits that MarketWise, Inc. anticipates from any redemptions or exchanges of LLC Units for its Class A common stock or cash pursuant to the MarketWise Operating Agreement in the future, tax distributions payable to MarketWise, Inc. may be in amounts that exceed its actual tax liabilities and obligations to make payments under the Tax Receivable Agreement with respect to the relevant taxable year. MarketWise, Inc.’s board of directors (“Board”) will determine the appropriate uses for any excess cash so accumulated, which may include, among other uses, the payment of other expenses or dividends on MarketWise, Inc.’s stock, although MarketWise, Inc. will have no obligation to distribute such cash (or other available cash) to its stockholders. On January 15, 2025, MarketWise, Inc. has declared a special dividenddividends to Class A shareholders to distribute excess tax distributions received from MarketWise, LLC. Except as otherwise determined by MarketWise, Inc. as the sole manager of MarketWise, LLC, there is no adjustment to the exchange ratio for LLC Units and corresponding shares of our Class A common stock as a result of any cash distributions or any retention of cash by MarketWise, Inc. To the extent MarketWise, Inc. does not distribute such excess cash as dividends on its Class A common stock, it may take other actions with respect to such excess cash—for example, holding such excess cash or lending it (or a portion thereof) to MarketWise, LLC, which may result in shares of our Class A common stock increasing in value relative to the value of the LLC Units. The MarketWise Members may benefit from any value attributable to such cash balances if they acquire shares of our Class A common stock in exchange for their LLC Units, notwithstanding that such holders may previously have participated in distributions by MarketWise, LLC as holders of the LLC Units that resulted in such excess cash balances held by MarketWise, Inc.

Payments under the Tax Receivable Agreement will be based on the tax reporting positions that MarketWise, Inc. determines, and the IRS or another tax authority may challenge all or part of the tax basis increases or other tax benefits MarketWise, Inc. claims, as well as other related tax positions it takes, and a court could sustain any such challenge. MarketWise, Inc.’s ability to settle or to forgo contesting such challenges may be restricted by the rights of the MarketWise Members pursuant to the Tax Receivable Agreement, and such restrictions apply for as long as the Tax Receivable Agreement remains in effect. In addition, MarketWise, Inc. will not be reimbursed for any cash payments previously made to the MarketWise Members under the Tax Receivable Agreement in the event that any tax benefits initially claimed by MarketWise, Inc. and for which payment has been made to the MarketWise Members are subsequently challenged by a taxing authority and are ultimately disallowed. Instead, any excess cash payments made by MarketWise, Inc. to the MarketWise Members will be netted against any future cash payments that MarketWise, Inc. might otherwise be required to make to the MarketWise Members under the terms of the Tax Receivable Agreement. However, MarketWise, Inc. might not determine that it has effectively made an excess cash payment to the MarketWise Members for a number of years following the initial time of such payment, and, if any of its tax reporting positions are challenged by a taxing authority, MarketWise, Inc. will not be permitted to reduce any future cash payments under the Tax Receivable Agreement until any such challenge is finally settled or determined. Moreover, the excess cash payments MarketWise, Inc. previously made under the Tax Receivable Agreement could be greater than the amount of future cash payments against which MarketWise, Inc. would otherwise be permitted to net such excess. The applicable U.S. federal income tax rules for determining applicable tax benefits MarketWise, Inc. claims are complex and factual in nature, and there can be no assurance that the “IRS” or a court will not disagree with MarketWise, Inc.’s tax reporting positions. As a result, payments could be made under the Tax Receivable Agreement in excess of the tax savings that MarketWise, Inc. actually realizes in respect of the tax attributes with respect to the MarketWise Members that are the subject of the Tax Receivable Agreement.

We have received written notice from Nasdaq thatIf we aredo not in compliance with Nasdaq’s minimum bid price requirements and if we are unable to regainmaintain compliance with Nasdaq continued listing standards, we could be delisted from The Nasdaq Stock Market, which would negatively impact our business, our ability to raise capital, and the market price and liquidity of our Class A Common Stock.

Purchases of shares of our common stock by us pursuant to oura stock repurchase program may affect the value of our common stock, and there can be no assurance that our stock repurchase program will enhance stockholder value.

In February 2025, ourOur Board previously approved a stock repurchase programprogram. Repurchase activities pursuant to whicha we are authorized tostock repurchase up to $50 million of our Class A common stock either through open market transactions or through other transactions at the discretion of the management of the Company for a period of 12 months. The timing and amount of any share repurchases will be determined based on legal requirements, price, market and economic conditions, the nature of other investment opportunities available to us from time to time, the availability of cash, and other factors. These repurchase activitiesprogram could increase, or reduce the size of any decrease in, the market price of our common stock at that time and, as a result, the price of our shares of common stock maycould be higher than the price that otherwise might exist in the open market.market at that time.

Although ourA share repurchase program is intended to enhance long-term stockholder value,value; however, short-term share price fluctuations could reduce the program’s effectiveness. Our repurchasesRepurchases could affect the trading price of our common stock, increase trading price volatility, and thea stock repurchase program may be suspended or terminated at any time, which may result in a decrease in the trading prices of our common stock.stock at that time. Additionally, repurchases under oura share repurchase program will continue tomay diminish our cash reserves, which could impact our ability to pursue possible strategic opportunities and acquisitions and could result in lower overall returns on our cash balances. There can be no assurance that any share repurchases will enhance stockholder value.

We qualify as an “emerging growth company” and a smaller reporting company, and the reduced disclosure requirements applicable to emergingsmaller growth companies and smaller growth companies may make itsour securities less attractive to investors.

Additionally, weWe qualify as a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K under the Securities Act. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements in its periodic reports. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible.

It is difficult to predict whether investors will find our securities less attractive as a result of our taking advantage of these exemptions and relief granted to emerging growth companies and smaller reporting companies. If some investors find our securities less attractive as a result, the trading prices of our securities may be lower than they otherwise would be, there may be a less active trading market for our securities and the market price of our securities may be more volatile.

OnceIf we lose our “emerging growth company” and/or “smaller reporting company” status, we will no longer be able to take advantage of certain exemptions from reporting. If we lose our "non-accelerated filer" status, we will be required to comply with the auditor attestation requirements of Section 404 of SOX. We will incur additional expenses in connection with such compliance and our management will need to devote additional time and effort to implement and comply with such requirements.

As a public company, we have, and will continue to incur legal, regulatory, finance, accounting, investor relations, and other expenses that we did not previously incur as a private company, including costs associated with public company reporting requirements and costs of recruiting and retaining non-executive directors. We are now subject to the Exchange Act, including the reporting requirements thereunder, SOX, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Nasdaq rules and other applicable securities rules and regulations. Compliance with these rules and regulations will increase our legal and financial compliance costs, make some activities more difficult, time-consuming, or costly (although these costs are currently unable to be estimated with any degree of certainty), and increase demand on our systems and resources, particularly after we are no longer an “emerging growth company” or a “smaller reporting company.” The expenses incurred by public companies generally for reporting and corporate governance purposes have been increasing. Our management will need to devote a substantial amount of time to ensure that we comply with all of these requirements, diverting the attention of management away from revenue-producing activities. Further, these rules and regulations may make it more difficult and more expensive for us to obtain certain types of insurance, including directors’ and officers’ liability insurance, which could make it more difficult for us to attract and retain qualified members of our Board. We may be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. In addition, enhanced legal and regulatory regimes and heightened standards relating to corporate governance and disclosure for public companies result in increased legal and financial compliance costs and make some activities more time consuming.

Pursuant to Section 404 of SOX, oncesince we are no longer an emerging growth company or a smaller reporting company, we maywill be required to furnish an attestation report on internal control over financial reporting issued by our independent registered public accounting firm. When our independent registered public accounting firm is required to undertake an assessment of our internal control over financial reporting, the cost of complying with Section 404 of SOX will significantly increase, and management’s attention may be further diverted from other business concerns, which could adversely affect our business and results of operations. We may need to hire more employees in the future or engage outside consultants to comply with the requirements of Section 404 of SOX, which will further increase cost and expense.

OurIf failurewe to remediateidentify additional material weaknesses in the future, could adversely affect our abilityinternal control over financial reporting we may be unable to report financial information, including filing of quarterly or annual reports with the SEC on a timely and accurate basis. Moreover, our identification of additional material weaknesses could prohibit us from producingproduce timely and accurate financial statements, which maycould adversely affect theour business and market price of shares of our Class A common stock and we may be unable to maintain compliance with listing requirements.stock.

•failure to meet or exceed financial estimates and projections of the investment community;

In 2024,2025, we paid quarterly and special dividends on shares of our Class A common stock. We also declared a special dividend for Class A shareholders on January 15, 2025. Our continued declaration and payment of dividends and institution of any other distributions of capital to shareholders will nonetheless be at the discretion of our Board and will depend on many factors, including our earnings, financial condition and results of operations, capital requirements, ability to obtain cash or other assets from our subsidiaries, restrictions imposed by applicable law, general business conditions and other factors that our Board may deem relevant. There can be no assurance that we will continue to pay dividends in the future. Therefore, the success of an investment in shares of our Class A common stock may in the future depend only upon any future appreciation in their value. There is no guarantee that shares of our Class A common stock will appreciate or even maintain their value.

The Company may allocate a portion of its cash on hand to investments meeting pre-determined guidelines, including U.S.-listed equity securities, with the objective to provide an acceptable rate of return while complying with established risk tolerances and liquidity parameters. See Item 7 “Management’s Discussion & Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” for more information. The Company’s holdings may be concentrated in a relatively small number of issuers. A significant decline in the market value of our investments, which are exposed to market volatility, may negatively affect the Company’s financial condition and results of operations. Additionally, we are required under accounting principles to include changes in unrealized gains and losses on equity securities in the Company’s reported net income (loss), even though the Company has not actually realized any gain or loss by selling such securities. Accordingly, changes in the market prices of such securities can have a significant impact on the Company’s reported results for the period, even though those changes do not bear on the performance of the Company’s operating business.

MarketWise started in 1999 with the simple idea that, if we could publish intelligent, independent, insightful, and in-depth investment research and treat the subscriber the way we would want to be treated, then subscribers would renew their subscriptions and stay with us. Over the years, we have expanded our business into a comprehensive suite of investment research products and solutions. We now produce a diversified product portfolio from a variety of financial research brands such as Stansberry ResearchResearch, Chaikin Analytics, Altimetry, TradeSmith, Investor Place,InvestorPlace, and Brownstone Research. Our entire investment research product portfolio is 100% digital and channel agnostic, and we offer all of our research across a variety of platforms, including desktop, laptop, and mobile devices, including tablets and mobile phones.

▪NetTotal incomenet revenue was $93.1$328.1 million for full year 2025 compared with $408.7 million for full year 2024 compared with $54.3 million for full year 2023(1)

▪Cash and cash equivalents were $97.9 million as of December 31, 2024 The following table presents net cash provided by operating activities (“CFFO”),CFFO, and the related margin as a percentage of net revenue, and Adjusted CFFO (as defined below), a non-GAAP measure, and the related margin as a percentage of Billings, for each of the periods presented. For more information on Adjusted CFFO and Adjusted CFFO Margin (as defined below), see “— Non-GAAP Financial Measures.”

Our Paid Subscribers (as defined below) as of December 31, 20242025 generated average customer lifetime Billings of approximately $1,120,$2,031, resulting in a LTV/CAC (as defined below) ratio of approximately 1.3x.2.0x On average it takes us approximately 1.6compared to 1.71.3x yearsat forDecember a31, Paid Subscriber’s cumulative net revenue to exceed the total cost of acquiring that subscriber (which includes fixed costs, such as marketing salaries).2024. For more information on Billings and our LTV/CAC ratio and the components of this ratio, see “—Key Business Metrics” and “—Definitions of Metrics,” We adjust our marketing spend to drive efficient and profitable customer acquisition. We can adjust our marketing spend in near real-time, and we monitor costs per acquisition relative to the cart value of the initial subscription.

As of December 31, 2024, our Paid Subscriber base was 506 thousand, down 231 thousand, or 31.4% as compared to 737 thousand at December 31, 2023. Our Paid Subscriber base is comprised of subscribers obtained through both direct-to-paid acquisition and free-to-paid conversions. Since 2022,2023, direct-to-paid acquisition has accounted for approximately 50%48% of our annual Paid Subscriber acquisition, and is largely driven by display ads and targeted email campaigns. Our free subscription products also serve as a significant source of new Paid Subscribers, accounting for approximately 52% of our annual Paid Subscriber acquisition.

Retaining and expanding relationships with existing subscribers. We believe that we have a significant opportunity to expand our relationships with our large base of Active Free Subscribers and Paid Subscribers. Thanks to the quality of our products, we believe our customers will continue their relationship with us and extend and increase their subscriptions over time. As we deepen our engagement with our subscribers, our customers tend to purchase more and higher-value products. Our ARPU (as defined below) as of December 31, 20242025 was $394,$670, which decreasedincreased 21.7%70.1% from $503$394 as of December 31, 2023.2024. For more information on ARPU, see “Key Business Metrics — Average Revenue Per User.”

We may face challenges and uncertainty in retaining and expanding relationships with existing subscribers due to the wind-down of operations of Legacy Research announced in February 2024 and any reputational harm associated with misconduct of former employees as discussed in the Risk Factor “Failure to maintain and protect our reputation for trustworthiness and independence may harm our business” included elsewhere in this annual report.

Active Free Subscribers. Active Free Subscribers are defined as unique subscribers who have subscribed to one of our free investment publications via a valid email address and continuewho tohave remainreceived directlyand/or optedconsumed in,our content during the quarter, excluding any Paid Subscribers who also have free subscriptions. Free subscriptions are often daily publications that include some commentary about the stock market, investing ideas, or other specialized topics. Included within our free publications are advertisements and editorial support for our current marketing campaigns. While subscribed to our publications, Active Free Subscribers learn about our editors and analysts, get to know our products and services, and learn more about ways we can help them be a better investor. Since 2023, approximately 52% of our new Paid Subscribers come from free to paid conversions.

Active Free Subscribers increaseddecreased by 0.71.3 million, or 4.7%,38.8%, to 16.42.0 million as of December 31, 20232025 as compared to 15.73.3 million as of December 31, 2022. As of December 31, 2023, Active Free Subscribers decreased by 0.2 million, or 5.3%, to 4.1 million as compared to 4.3 million as of December 31, 2022.2024. The year over year declinedecrease in Active Free Subscribers wasis a result of decreasedfewer engagementfree withsubscribers in total, a reduced number of free products available as we rationalize our Freeofferings, Subscriberand communitymore astargeted consumeremail engagement continued to be soft.sends.

Total Paid Subscribers decreased by 231 thousand, or 31.4%, to 506 thousand as of December 31, 2024 as compared to 737 thousand atas of December 31, 2023, driven by continued soft consumer engagement as well as elevated churn due to expiring subscriptions in our Legacy Research Group which likely came as a result of the wind down of this business which occurred during 2024. Additionally, direct marketing spend decreased as we managed profitability given the aforementioned factors .factors. The decrease was further compounded by the loss of approximately 20 thousand Paid Subscribers as part of sale of the MMPMoney Map Press, LLC Business in fourth quarter 2024. See also Note 5 – Acquisitions and Disposals.

Subscriber count churn rate has ranged from approximately 2.4% to 3.3%3.7% per month between 20222023 and 2024.2025. Almost all of the subscribers who churned in 20242025 did so having owned only one entry level publication. This is evidenced by the fact that their ARPU approximately matched the subscription price of our entry level publications. We believe our net revenue retention rate, which has averaged over 55%improved from 202253% in 2024 to 2024,91% in 2025, is a more meaningful gauge of subscriber satisfaction.

ARPU decreasedincreased by $109,$276, or 21.7%,70.1%, to $670 as of December 31, 2025 as compared to $394 as of December 31, 2024 as compared to $503 as of December 31, 2023.2024. The year-over-year decreaseincrease was driven by a 37%13% decreaseincrease in trailing four quarter Billings, while trailing four quarter average Paid Subscribers only decreased by 20%.(33)%. The decreaseincrease in trailing four quarter Billings was driven by reducedsuccessful engagementcampaigns ofinvolving prospectiveour andsoftware existing subscribers,products, as further discussed in —Billings below. The decrease in trailing four quarter Paid Subscribers is also driven by the winding down of our Legacy Research Group business during 2024.

ARPU decreased by $16,$109, or 3.1%,21.7%, to $394 as of December 31, 2024 as compared to $503 as of December 31, 2023 as compared to $519 as of December 31, 2022.2023. The year-over-year decrease was driven by a 17%37% decrease in trailing four quarter BillingsBillings, in 2021, which significantly outpaced the decrease inwhile trailing four quarter average Paid Subscribers ofonly 14%.decreased by 20%. The decrease in trailing four quarter Billings was largely driven by cessationreduced engagement of prospective and existing subscribers.subscribers, as further discussed in —Billings below. The decrease in trailing four quarter Paid Subscribers is also driven by the winding down of our Legacy Research Group business during 2024. Our ARPUs remain high relative to other subscription businesses, and we attribute this to the quality of our content and effective sales and marketing efforts regarding higher value content, bundled subscriptions and membership subscriptions.

OtherNew Marketing Billings are Billings from revenueall share,new advertisingsubscription andsales. conferences.New OtherMarketing Billings decreasedincreased by $1.4$36.4 millionmillion, or 18.9%22.3%, to $6.0$199.1 million in 20242025 as compared to $7.4$162.8 million in 20232024. asThe increase was primarily driven by sales of our software related content and to a resultlesser extent, sales of decreasingour revenueentry sharelevel activity with external parties.products.

TotalNew Marketing Billings decreased by $143.3$115.5 million, or 37.5%,41.5%, to $239.1$162.8 million in 2024 as compared to $382.4$278.3 million in 2023. The decrease was primarily driven by theceasing windingnew downsales ofcampaigns within our Legacy Research Group brandsbrands, which began winding down operations in mid-February 2024. WhileThe balance of the growth of 12-month inflation rates has declined year over year, the consumer price indexdecline was still up 2.9%. We believe this continuesdue to createcontinuing soft engagement and reluctance among prospective andof existing subscribers to purchase ouradditional higher priced subscriptions.

Today, we benefit from the confluence of a leading editorial team, a diverse portfolio of content and brands, and a comprehensive suite of investor-centric tools that appeal to a broad subscriber base.

FirstSecond Quarter 2026 Highlights (1)

▪Total net revenue was $77.0$75.8 million in the firstsecond quarter 2026(2)

▪Total Billings were $81.4$91.2 million in firstthe second quarter 2026, a year-over-year increase of 15%57%

▪Net loss was $0.6$2.6 million in firstthe second quarter 2026

▪Cash from Operating Activities (“CFFO”) was $(2.1)$22.4 million in firstthe second quarter 2026, aan declineincrease of $3.8$4.6 million compared to the second quarter 2025. On a year to date basis, CFFO improved by $0.8 million compared to first quarterhalf of 2025.

▪Cash and cash equivalents were $52.7$32.9 million as of MarchJune 31,30, 2026, and no debt outstanding (1) The firstsecond quarter 2026 and 2025 quarterly results reported herein are unaudited.

The following table presents net cash provided by operating activities, and the related margin as a percentage of net revenue, Adjusted CFFO (as defined below), a non-GAAP measure, and the related margin as a percentage of Billings, and Free Cash FlowFlow, and EBITDA (as defined below), botha non-GAAP measures,measure, for each of the periods presented. For more information on our non-GAAP measures, see “— Non-GAAP Financial Measures.”

Our Paid Subscribers (as defined below) as of December 31, 2025 generated average customer lifetime Billings of approximately $2,031, resulting in a LTV/CAC (as defined below) ratio of approximately 2.0x. For more information on Billings and our LTV/CAC ratio and the components of this ratio, see “—Key Business Metrics” and “—Definitions of Metrics,Metrics.” We adjust our marketing spend to drive efficient and profitable customer acquisition. We can adjust our marketing spend in near real-time, and we monitor costs per acquisition relative to the cart value of the initial subscription.

Retaining and expanding relationships with existing subscribers. We believe that we have a significant opportunity to expand our relationships with our large base of Active Free and Paid Subscribers. Thanks to the quality of our products, we believe our customers will continue their relationship with us and extend and increase their subscriptions over time. As we deepen our engagement with our subscribers, our customers tend to purchase more and higher-value products. Our ARPU (as defined below) as of MarchJune 31,30, 2026 was $738,$822, which increased 76.2%by $347, or 73.3% from $419$474 as of MarchJune 31,30, 2025. For more information on ARPU, see “Key Business Metrics — Average Revenue Per User.”

Our high-value composition rate reflects the percentage of Paid Subscribers that have purchased more than $600 of our products over their lifetime. We believe our high-value composition rate reflects our ability to retain existing subscribers through renewals and our ability to expand our relationship with them when those subscribers purchase higher-value subscriptions. Our ultra high-value composition rate reflects the percentage of Paid Subscribers that have purchased more than $5,000 of our products over their lifetime. We believe our ultra high-value composition rate reflects our ability to successfully build lifetime relationships with our subscribers, often across multiple products and brands. As of MarchJune 31,30, 2026, 62%60% of our Paid Subscribers were high-value subscribers and 29%28% of our Paid Subscribers were ultra high-value subscribers.

High-value composition rate: High-value composition rate is the number of high-valued subscribers divided by Paid Subscribers. High-value subscribers are Paid Subscribers who have purchased >greater than $600 in aggregate over their lifetime.

LTV/CAC ratio: We calculate LTV/CAC ratio as LTV divided by CAC. We use LTV/CAC ratio because it is a standard metric for subscription-based businesses, and we believe that an LTV/CAC ratio above 3x is considered to be indicative of strong profitability and marketing efficiency. We believe that an increasing LTV per subscriber reflects our existing subscribers recognizing our value proposition, which will expand their relationship with us across our platform over time, either through a combination of additional product purchases or by joining our membership offerings. Investors should consider this metric when evaluating our ability to achieve a return on our marketing investment. Lifetime valueValue (“LTV”) represents the average margin on average customer lifetime Billings (that is, the estimated cumulative spend across a customer’s lifetime). Customer acquisitionAcquisition costCosts (“CAC”) isare definedcomprised asof: direct marketing spend, plusexpenses; external revenue share expense, plusexpenses; retention and renewal expenses, plus copywriting and marketing salaries, plussalaries; telesales salaries and commissions,commissions; plusand customer service commissions.

Active Free Subscribers decreased by 1.00.2 million, or 34.4%,6.1%, to 2.02.1 million as of MarchJune 31,30, 2026 as compared to 3.02.3 million as of MarchJune 31,30, 2025. The year over year decrease in Active Free Subscribers is a result of fewer free subscribers in total,total and a reduced number of free products available as we rationalize our offerings, and more targeted email sends.offerings.

Active Free Subscribers decreasedincreased by 0.1 million, or 3.9%7.9% to 2.02.1 million as of MarchJune 31,30, 2026 as compared to 2.0 million as of DecemberMarch 31, 2025.2026. The slight sequential reductionincrease was the result of theincreased continuedsuccess with targeted email sends.sends during the quarter.

Subscriber count churn has ranged from approximately 2.4% to 3.7% per month between 2023 and 2025. Almost all of the subscribers who churned in firstsecond quarter 2026 did so having owned only one entry level publication. This is evidenced by the fact that their ARPU approximately matched the subscription price of our entry level publications. We believe our net revenue retention rate, which improved from 53% in 2024 to 91% in 2025, is a more meaningful gauge of subscriber satisfaction.

Average Revenue Per User (“ARPU”). We calculate ARPU as the trailing four quarters of net Billings divided by the average number of quarterly total Paid Subscribers over that period. We believe ARPU is a key indicator of how successful we are in attracting subscribers to higher-valuehigher value content. We believe that our high ARPU is indicative of the trust we build with our subscribers and of the value they see in our products and services.

ARPU increased by $319,$347, or 76.2%,73.3%, to $738$822 as of MarchJune 31,30, 2026 as compared to $419$474 as of MarchJune 31,30, 2025. The year-over-year increase was driven by a 21%35% increase in trailing four quarterfour-quarter Billings, while trailing fourfour-quarter quarteraverage Paid Subscribers decreased by 31%.22%. The Billings increase in trailing four quarter Billings was drivenseen byacross salesour product categories with the highest level of growth on a percentage basis coming from our software related content and to a lesser extent, sales of our entry level products.offerings. The decrease in trailing four quarterfour-quarter Paid Subscribers was driven by the winding down of our Legacy Research business during 2024. At the time of shutdown, paid Legacy Research subscribers were given replacement subscriptions to other affiliates within MarketWise for at least the duration of their original subscription. The last significant batch of these replacement subscriptions expired in the second quarter 2025 and as such, those subscribers are still impacting the trailing four quarterfour-quarter Paid Subscribers ending firstJune quarter30, 2025.

ARPU increased by $69,$83, or 10.3%,11.4%, to $822 as of June 30, 2026 as compared to $738 as of March 31, 2026 as compared to $670 as of December 31, 2025.2026. The sequential increase was driven by a 6%11.7% decreaseincrease in trailing four-quarter Billings, while trailing four-quarter average Paid Subscribers, while trailing four-quarter BillingsSubscribers were up 4%.flat. Our ARPUs remain high relative to other subscription businesses, and we attribute this to the quality of our content and effective sales and marketing efforts regarding higher value content, bundled subscriptions and membership subscriptions.

Billings. Billings representsrepresent amounts invoiced to customers. We measure and monitor our Billings because it provides insight into trends in cash generation from our marketing campaigns. We generally bill our subscribers at the time of sale and receive full cash payment up front, and defer and recognize a portion of the related revenue ratably over time for term and membership subscriptions. For certain subscriptions, we may invoice our Paid Subscribers at the beginning of the term, in annual or monthly installments, and, from time to time, in multi-year installments. Only amounts invoiced to a Paid Subscriber in a given period are included in Billings. While we believe that Billings provides valuable insight into the cash that will be generated from sales of our subscriptions, this metric may vary from period to period for a number of reasons and, therefore, Billings has a number of limitations as a quarter-over-quarter or year-over-year comparative measure. These reasons include, but are not limited to, the following: (i) a variety of contractual terms could result in some periods having a higher proportion of annual or membership subscriptions than other periods; (ii) fluctuations in payment terms may affect the Billings recognized in a particular period; and (iii) the timing of large campaigns may vary significantly from period to period.

While Net Revenue and Billings are both related to sales of our products, there are key differences in how those sales are recognized. From a Net Revenue perspective, substantially all of the amounts invoiced to customers are originally reported as deferred revenue on our Balance Sheet and isare subsequently recognized as Net Revenue over a period up to 5 years; whereas Billings, as defined above, represents amounts invoiced to customers in each period, and provides more insight from a cash generation perspective. As a result, there will be a perpetual disconnect between Billings and Net Revenue.

New Marketing Billings are Billings from all new subscription sales. New Marketing Billings increased by $9.6$32.0 million, or 18.6%,77.0%, to $60.9$73.6 million for firstsecond quarter 2026 as compared to $51.3$41.6 million for firstsecond quarter 2025. The increase was primarily driven by sales across all of our categories, with the largest percentage increases coming from our entry level traditional newsletters followed by software related content and higher value productstraditional as well as sales of our software related content.newsletters.

New Marketing Billings increased by $3.4$12.7 million, or 5.9%21.0% to $60.9$73.6 million for firstsecond quarter 2026 as compared to $57.5$60.9 million in fourthfirst quarter 2025.2026. The increase was primarily driven by sales of our entry level and higher value productstraditional newsletters in firstthe second quarter 2026.

Net Renewal Billings are Billings from renewals and maintenance fee payments. Net Renewal Billings increased by $0.7$1.0 million, or 3.7%,6.3%, to $19.0$16.4 million for firstsecond quarter 2026 as compared to $18.3$15.4 million for firstsecond quarter 2025. The increase camewas fromprimarily driven by renewals of premiumour pricedhigher term subscriptions of bothvalue traditional newsletters as well as our software related content.newsletters.

TotalNet Renewal Billings increaseddecreased by $10.9$2.6 million, or 15.5%,13.9%, to $81.4$16.4 million for the firstsecond quarter 2026 as compared to $70.5$19.0 million for first quarter 2025.2026. The increasedecrease was primarily driven by newa marketingfar salessmaller base of oursubscriptions entryavailable levelfor productsrenewal asin wellsecond asquarter sales2026 vs first quarter 2026 due to timing of ourcampaigns softwarein relatedthe content.previous year.

TotalOther Billings increasedare Billings from revenue share, advertising and conferences. Other Billings decreased by $2.5$0.1 million, or 3.2%,2.2% to $81.4$1.1 million for firstsecond quarter 2026 as compared to $78.9$1.2 million for fourthsecond quarter 2025. The increase was primarily driven by new marketing sales and renewals of traditional newsletter products.

Impairment losses relate to impairment of leaseholdintangible improvements.assets.

Other Income (Expense),Income, Net

Other income (expense),income, net primarily consists of the net gains or losses on our embedded derivative instruments.instruments and gain on sale of business unit.

Interest (Expense) Income, Net

Interest (expense) income, net primarily consists of interest income from our money market accounts.

As of MarchJune 31,30, 2025,2026, MarketWise, Inc.’s controlling interest in MarketWise, LLC was 14.5%17.0% and the noncontrolling interest was 85.5%.83.0%. For the three months ended MarchJune 31,30, 20252026, net income attributable to controlling interests included a $1.0$0.2 million tax provision,benefit, and for six months ended June 30, 2026, net income attributable to controlling interests included a $0.1 million tax benefit both of which iswere 100% attributable to the controlling interest.

Comparison of Three Months Ended MarchJune 31,30, 2026 and Three Months Ended MarchJune 31,30, 2025

The decrease in net revenue was primarily driven by a $7.1decrease of $2.1 million decrease in term subscription revenue and a $0.2 million decrease in membership subscription revenue, partially offset by a $0.8$1.9 million increasein term subscription revenue, and $0.2 million in non-subscription revenue.

TermMembership subscription and term subscription revenue decreased during the three months ended MarchJune 31,30, 2026, primarily due to the wind down of Legacy Research and a decrease in Billings in prior periods causing reduced revenue recognition in the 2026 period,period whichsince contributedrevenue $3.0is milliondeferred and $5.5recognized million toover the overall term subscription revenue decrease, respectively.term. This is partially offset by an increase in Billings. Importantly, while Billings for the firstsecond quarter of 2026 increased 15%56.7% year over year, and represented the strongest quarterly Billings total since 2023, only a portion is recognized as Net Revenue in the current period, with the majority of the Billings recorded as Deferred Revenue to be recognized over future periods.

Non-subscription revenue increaseddecreased during the three months ended MarchJune 31,30, 2026, primarily due to decrease in income related to revenue share agreements.

Cost of revenue decreasedincreased $0.2 million primarily driven by a $0.7$1.0 million increase in credit card fees. This increase in Cost of revenue was partially offset by a $0.4 million decrease in stock-based compensation expense, and a $0.1$0.3 million decrease in outsourcedsalaries, customertaxes service.and benefits and outside labor.

Sales and marketing expenses increased $11.2 million primarily due to a $8.7$12.8 million increase in marketing expense as the Company meaningfully increased marketing efforts in the quarter due to multiple successful product launches. The increase in marketing expenses drove significantly higher customer acquisition in the quarter which also resulted in an increase in Paid Subscribers following several years of Paid Subscriber declines. From a timing perspective, the majority of Sales and marketing expenses are recognized in the period incurred whereas a majority of Billings resulting from the marketing efforts are recorded as Deferred Revenue. Additionally, salesSales and marketing expense increased due to a $1.0$1.2 million increase in salaries, taxes and benefits due to increased headcount. This increase in Sales and marketing expense was partially offset by a $4.6$2.6 million decrease in amortization of deferred contract acquisition costs.

General and administrative expense increased $2.9 million primarily due to aan $1.8increase of $1.4 million increasein incentive compensation, $0.8 million in professional services, a $1.0$0.7 million increase in incentive compensation, a $0.9 million increase in software expense, and a $0.5$0.3 million increase in salaries, taxes and benefits.benefits, Additionally,and the$1.1 2025million period’sin stock-based compensation expense. This increase in general and administrative expense was reducedoffset by one off items including a $1.6$1.4 million gaindecrease onin leaseoutside termination and a $1.2 million gain on contingent consideration receivable.labor.