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

If the rate of decline in the number of subscribers to Distributor services increases or these subscribers shift to other services or bundles that do not include our stations or programming networks, there may be a material adverse effect on our revenues.revenue.

If the rate of decline in the number of Distributor service subscribers increases or if subscribers shift to OTT services or smaller bundles of programming that do not include our programming networks, this may have a material adverse effect on our revenues.revenue.

If subscribers shift to DTC platforms, this may have a material adverse effect on our revenues.revenue.

As distribution agreements expire, we may not be able to renegotiate such agreements at terms comparable to or more favorable than our current agreements. This may cause revenuesrevenue and/or revenue growth from our distribution agreements to decrease under the renegotiated terms despite the fact that our current distribution agreements include automatic annual fee escalators. In addition, certain networks or program service providers with which our stations are affiliated are currently, or in the future are expected to, require us to share revenue from distribution agreements with them as part of renewing expiring affiliation agreements or pursuant to certain rights contained in existing affiliation agreements. Generally, our distribution agreements and agreements with networks or program service providers are for different lengths of time and expire in different periods. If we are unable to negotiate a distribution agreement or the revenue received as part of those agreements declines over time, then we may be exposed to a reduction in or loss from distribution revenue net of revenue shared with networks and program service providers. We cannot predict the outcome or provide assurances as to the outcome of any future negotiations relating to our distribution agreements or what impact, if any, they may have on our financial condition and results of operations. See Television Markets and Stations within Item 1. Business for a listing of current expirations of our affiliation agreements.

The FCC’s prohibition on certain joint retransmission consent negotiations and the possible elimination or modification of the network non-duplication and syndicated exclusivity protection rules may affect our ability to sustain our current level of distribution revenuesrevenue or grow such revenuesrevenue in the future and could have an adverse effect on our business, financial condition and results of operations.

We have pursued and intend to selectively continue to pursue divestitures, acquisitions and investments, which may include, mergers, station swaps and joint ventures, subject to market conditions, our liquidity, and the availability of attractive acquisition and investment candidates, with the goal of enhancing or expanding our existing business and to acquire and develop new products and services. In the future, we may not be able to identify attractive acquisitions and investments, or we may not be able to fund additional acquisitions and investments.

Acquisitions and investments involve inherent risks, such as increasing leverage and debt service requirements and combining company cultures and facilities, and we may not be able to successfully implement effective cost controls, achieve expected synergies, or increase revenuesrevenue as a result of an acquisition or investment. Future acquisitions and investments may result in our assumption of unexpected liabilities, may result in the diversion of management’s attention from the operation of our core business and may limit our ability to generate higher returns elsewhere. Additionally, acquisitions and investments present numerous growth challenges, and our investments may not be favorably received by the market and may fail to grow.

We face intense, wide-ranging competition for viewers and advertisers.advertisers, which could have a negative impact on the amount of advertising revenue we earn.

We compete, in certain respects and to varying degrees, for viewers and advertisers with other programming networks, pay-per-view, video on demand, online streaming services, and other content offered by Distributors. We also compete for viewers, listeners and advertisers with connected televisions, OTT and DTC, mobile media, radio, motion picture, home video, stadiums and arenas, podcasts, outdoor advertising and other sources of information and entertainment and advertising services. Important competitive factors are the prices we charge for our programming networks, the quantity, quality and variety of the programming offered and the effectiveness of marketing efforts.

With respect to advertising services, factors affecting the degree and extent of competition include prices, reach and audience demographics, among others. Some of our competitors are large companies that have greater financial resources available to them than we do, which could impact our viewership and the resulting advertising revenues.revenue.

•print media providers such as newspapers, direct mail and periodicals;

The ways in which consumers view content and technology and business models in our industry continue to rapidly evolve and new distribution platforms and increased competition from new entrants and emerging technologies have added to the complexity of maintaining predictable revenue streams. Technological advancements have driven changes in consumer behavior as consumers seek more control over when, where and how they consume content and have affected advertisers’ options for reaching their target audiences. Consumer preferences have evolved towards subscription video on demand and free advertising supported video on demand services and other DTC offerings and there has been a substantial increase in the availability of content with reduced advertising or without advertising at all. Consumers are also increasingly using time-shifting and advertising-skipping technologies that enable them to fast-forward or circumvent advertisements. There has also been a proliferation of high-speed internet connections and expansion of 5G networks able to support high-quality streaming video within increasingly interactive and interconnected digital environments and on a wide variety of devices other than traditional televisions. Additionally, gaming and other consoles are establishing themselves as providers of video services. Substantial use of these technologies could impact the attractiveness of the Company’s programming to advertisers and adversely affect our advertising revenues.revenue. Our ability to meet consumer demands and expectations in today’s evolving mobile, multi-screen and multi-platform environment and to successfully adapt to technological advances in our industry, including alternative distribution platforms and viewing technologies, may affect the attractiveness of our offerings. Ineffective technology and product integration, lack of specific features and functionalities, poor interface design or ease of use, or performance issues, among other factors, may cause viewers to favor alternative offerings. Failure to adapt or to remain competitive with these developing technologies could have an adverse effect on our business, financial condition and results of operations.

Distributors are developing or have developed new technology that allows them to transmit more channels on their existing equipment to highly targeted audiences, reducing the cost of creating channels and potentially leading to the division of the television industry into ever more specialized niche markets. Competitors who target programming to such sharply defined markets may gain an advantage over us for television advertising revenues.revenue. The decreased cost of creating channels may also encourage new competitors to enter our markets and compete with us for advertising revenue.

Advertising revenuesrevenue can be significantly impacted by new technologies, since advertising sales are dependent on audience measurement provided by third parties, and the results of audience measurement techniques can vary independent of the size of the audience for a variety of reasons, including variations in, and difficulties related to, the employed statistical sampling methods, new distribution platforms and viewing technologies (such as digital recording and time-skipping technologies), and the shifting of the marketplace to the use of measurement of different viewer behaviors, such as delayed viewing. Nielsen’s statistical sampling method is the primary measurement technique used in our television advertising sales; however, the industry is expected to adopt new measurement currencies in the near-future and Nielsen is making methodological changes to the way it measures viewing by incorporating set top box and smart TV data. The emerging measurement currencies generally undercount over-the-air viewing and Nielsen has not prioritized over-the-air enhancements. If measurement evolves in a direction that is unfavorable to over-the-air viewing it could reduce the attractiveness of our audiences to advertisers. In addition to traditional measurement currencies, we also measure and monetize our campaign reach and frequency on and across digital platforms based on other third-party data using a variety of methods including the number of impressions served and demographics. These variations and changes could have a significant negative effect on advertising revenues.revenue.

We have experienced a cyber securitycyber-security breach in the past and may be vulnerable to future security breaches, data privacy, and other information technology failures that could have a material adverse effect on our financial performance and operating results and disrupt our operations.

We recurringly identify cyber threats as well as vulnerabilities in our systems and work to address them. Despite our efforts and the efforts of our third-party vendors to ensure the integrity of our software, computers, systems and information, we may not be able to anticipate, detect or recognize threats to our systems and assets, or to implement effective preventive measures against all cyber threats, especially because the techniques used are increasingly sophisticated, including the use of artificial intelligence, change frequently, are complex, and are often not recognized until launched. For example, in 2021, we detected an incident that resulted in an approximate $20 million loss, net of insurance recoveries. Cyber-attacks can originate from a variety of sources, including external parties who are affiliated with foreign governments or are involved with organized crime or terrorist organizations. Third parties may also attempt to induce employees, customers or other users of our systems to disclose sensitive information or provide access to our systems or network, or to our data or that of our counterparties, and these types of risks may be difficult to detect or prevent. Despite our security measures (including, employee training, multi-factor authentication, security information and event management, firewalls and testing tools, and backup and recovery systems), in 2021, we detected an incident that resulted in the loss in the fourth quarter of 2021 of approximately $63 million of advertising revenue, primarily related to our local media segment, as well as approximately $7 million in costs and expenses related to mitigation efforts, our investigation and the security improvements resulting therefrom. These amounts exceeded the limits under our insurance policies and thus, based on the known effects of the cyber incident, the cyber incident resulted in approximately $20 million of unrecoverable net loss through December 31, 2022. We expect cyber-attack and breach incidents to continue, and we are unable to predict the direct or indirect impact of future attacks or breaches on our business operations.

The occurrence of a cyber attack, breach, unauthorized access, misuse, ransomware, computer virus or other malicious code or other cybersecurity event could jeopardize or result in the unauthorized disclosure, gathering, monitoring, misuse, corruption, loss or destruction of confidential and other information that belongs to us, our customers, our counterparties, our employees, and third-party service providers that is processed and stored in, and transmitted through, our computer systems and networks. The occurrence of such an event could also result in damage to our software, computers or systems, or otherwise cause interruptions or malfunctions in our, our customers’, our counterparties’ or third parties’ operations. This could result in significant financial losses, loss of customers and business opportunities, reputational damage, litigation, regulatory fines, penalties, significant intervention, reimbursement or other compensatory costs, significant costs to investigate the event, remediate vulnerabilities and modify our protective measures, or otherwise adversely affect our business, financial condition or results of operations. While we maintain insurance to cover losses related to cybersecurity risks and business interruption, such policies, as was the case with respect to the October 2021 cybersecurity incident, may not be sufficient to cover all losses of this incident or any future incidents.

Our business depends upon cloud computing services provided by third-parties to provide a distributed computing infrastructure platform for certain of our business operations, including data processing, storage capabilities, and other services. Such third-party cloud computing services are vulnerable to damage or interruption from infrastructure changes, natural disasters, cybersecurity attacks, power outages, terrorist attacks, and other events or acts. In the future we could experience interruptions, delays and outages in service and availability from our third-party cloud computing providers from time to time due to a variety of factors, including, but not limited to, infrastructure changes, human or software errors, website hosting disruptions and capacity constraints. Because we cannot easily switch our cloud computing operations to other third-party providers without significant costs, any disruption ofof, or interference withwith, our use of third-party cloud computing service providers could have a materially negative impact on our business and the results of our operations.

The cost of producing and distributing entertainment programming has increased substantially in recent years due to, among other things, the increasing demands of creative talent and industry-wide collective bargaining agreements. Although we generally purchase programming content from others rather than produce such content ourselves, our program suppliers engage the services of writers, directors, actors and on-air and other talent, trade employees, and others, some of whom are subject to these collective bargaining agreements. Approximately 580550 of our employees and freelance employees are represented by labor unions under collective bargaining agreements. If we or our program suppliers are unable to renew expiring collective bargaining agreements, it is possible that the affected unions could take action in the form of strikes or work stoppages. Failure to renew these agreements, higher costs in connection with these agreements or a significant labor dispute could adversely affect our business by causing, among other things, delays in production that lead to declining viewers, a significant disruption of operations, and reductions in the profit margins of our programming and the amounts we can charge advertisers for time. Our stations also broadcast certain professional sporting events, and our viewership may be adversely affected by player strikes or lockouts which could adversely affect our advertising revenues,revenue, results of operations and result in rebates to our Distributors for not meeting minimum event thresholds. The amounts paid under our sports licensing agreements could be negatively impacted by rising professional player salaries and collective bargaining agreements. Further, any changes in the existing labor laws,laws includingand thepro-union possible enactment of the Employee Free Choice Act,reforms may further the realization of the foregoing risks.

We rely on sales of advertising time for a significant portion of our revenuesrevenue and, as a result, our operating results depend on the amount of advertising revenue we generate. If we generate less advertising revenue, it may be more difficult for us to repay debt and meet our debt service obligations, and the value of our business may decline. Our ability to sell advertising time depends on:

•the levels of political advertising, which are significantly higher in even-numbereven-numbered years and elevated further every four years related to the state, congressional, and presidential election cycles (as was the case in 2024), historically have represented a large portion of our advertising revenue; for the year ended December 31, 2025 (a non-political year), political advertising represented 3% of local media segment advertising revenue, and for the year ended December 31, 2024 (a political year), political advertising represented 26% of local media segment advertising revenue, and for the year ended December 31, 2023 (a non-political year), political advertising represented 4% of local media segment advertising revenue;

We internally originate and purchase programming in advance based on expectations about future revenues.revenue. Actual revenuesrevenue may be lower than our expectations. If this happens, it could have an adverse effect on our business, financial condition and results of operations.

The production of internally originated programming requires a large up-front investment and the revenuesrevenue derived from the airing of internally originated programming primarily depends upon its acceptance by the public, which is difficult to predict. The commercial success of original content also depends upon the quality and acceptance of other competing content released into the marketplace at or near the same time, the availability of a growing number of alternative forms of entertainment, general economic conditions and their effects on consumer spending, and other tangible and intangible factors, all of which can change and cannot be predicted with certainty. Any of these factors could reduce our revenuesrevenue or otherwise cause our costs to escalate relative to revenues.revenue. These factors are exacerbated during a weak advertising market.

One of our stations’ most significant costs is network and syndicated programming. We generally purchase syndicated programming content from others rather than producing such content ourselves, therefore, we have limited control over the costs of the programming. Often, we must purchase syndicated programming several years in advance and may have to commit to purchase more than one year’s worth of programming. We may replace programs that are doing poorly before we have recaptured any significant portion of the costs we incurred or before we have fully amortized the costs. We also receive programming from networks with which we have network affiliation agreements. The popularity of networks can affect revenue earned on those channels. If a particular network or program is not popular in relation to its costs, we may not be able to sell enough advertising time to cover the cost. Any of these factors could reduce our revenuesrevenue or otherwise cause our costs to escalate relative to revenuesrevenue and are likewise exacerbated during a weak advertising market.

As network affiliation agreements come up for renewal, we (or licensees of the stations we provide programming and/or sales services to), may not be able to negotiate terms comparable to or more favorable than our current agreements. The non-renewal or termination of any of our network affiliation agreements would prevent us from being able to carry programming of the relevant network. This loss of programming would require us to obtain replacement programming, which may involve higher costs and which may not be as attractive to our target audiences, resulting in reduced revenues.revenue. Upon the termination of any of our network affiliation agreements, we would be required to establish a new network affiliation agreement for the affected station with another network or operate as an independent station.

We may be subject to investigations or fines from governmental authorities, such as, but not limited to penalties related to violations of FCC indecency, children’s programming, sponsorship identification, closed captioning and other FCC rules and policies, the enforcement of which has increased in recent years, and complaints related to such violations may delay our FCC license renewal applications with the FCC.

We provide a significant amount of live news reporting that is provided by the broadcast networks or is controlled by our on-air news talent. Although both broadcast network and our on-air talent have generally been professional and careful about the information they communicate, there is always the possibility that information may be reported that is inaccurate or even in violation of certain indecency rules promulgated by the FCC. In addition, entertainment and sports programming provided by broadcast syndicators and networks may contain content that is in violation of the indecency rules promulgated by the FCC. Because the interpretation by the courts and the FCC of the indecency rules is not always clear, it is sometimes difficult for us to determine in advance what may be indecent programming. We have insurance to cover some of the liabilities that may occur, but the FCC has enhanced its enforcement efforts relating to the regulation of indecency. Also, the FCC has various rules governing children’s television programming,programming (including commercial matter limitations,limitations), closed captioning and sponsorship identification. We are subject to such rules regardless of whether the programming is produced by us or by third parties. Violation of the indecency, children’s programming, closed captioning or sponsorship identification rules could potentially subject us to penalties, license revocation, or renewal or qualification proceedings. For example, as described under LitigationFCC Matters within FCCLitigation, Claims, and Regulatory Matters under Note 12.11. Commitments and Contingencies within theSinclair’s Consolidated Financial Statements and Note 10. Commitments and Contingencies within SBG’s Consolidated Financial Statements, on May 22, 2020, the FCC released an Order and Consent Decree pursuant to which we agreed to pay $48 million and implement a four year compliance plan to resolve various matters (which compliance plan terminated on May 29, 2024) and on SeptemberJune 21,27, 20222025 issuedthe FCC released an Order and Consent Decree pursuant to which we agreed to pay $500,000 to resolve, without any admission of liability, a Noticeforfeiture oforder Apparentrelating Liability (NAL) alleging violations ofto the FCC’s limits on commercial matter in children’s television programming, a closed captioning investigation of Company station WUHF in Rochester, NY, and matters relating to certain of our pending station renewal applications. As part of the consent decree, we also agreed to implement a two-year compliance plan relating to the FCC’s limits on commercial matter in children’s programming and proposingclosed acaptioning forfeiturerules, and the FCC agreed to grant the license renewal applications of $2.7all millionCompany againststations involved in the Company,matters and fines ranging from $20,000 to $26,000 per station for other licensees coveredresolved by the NALconsent (including certain stations with whom the Company has an LMA, JSA, and/or SSA), for a total of $3.4 million. On October 21, 2022, the Company filed a written response seeking reduction of the proposed fine amount. On September 6, 2024, the FCC denied the Company’s request for reduction of the fine (and similar requests filed by certain other licensees) and issued a forfeiture order imposing the fine as proposed in the NAL. The Company and all other affected licensees filed a joint petition for reconsideration of the forfeiture order on October 7, 2024 and the matter remains pending. There can be no assurance that future incidents that may lead to significant fines or other penalties by the FCC can be avoided.decree.

The FCC’s multiple ownership rules and federal antitrust regulation may limit our ability to operate multiple television stations in some markets and may result in a reduction in our revenue or prevent us from reducing costs. Changes in these rules may threatenchange our existing strategic approach to certain television markets.

As discussed in National Ownership Rule under Ownership Matters under Federal Regulation of Television Broadcasting within Item 1. Business, in December 2017, the FCC released a Notice of Proposed Rulemaking to examine the National Ownership Rule, including the UHF discount, which remains pending. On June 18, 2025, the FCC issued a Public Notice seeking comment to update the public record in this proceeding on whether to modify, retain, or eliminate the 39% national audience reach cap and/or the UHF discount. Because we are near the 39% cap without application of the UHF discount, changes to the UHF discount or National Ownership Rule could limit our ability to acquire television stations in additional markets.

As discussed in Local Marketing and Outsourcing Agreements under Federal Regulation of Television Broadcasting within Item 1. BusinessBusiness, certain of our stations have entered into outsourcing or joint sales agreements (“JSAs”) pursuant to which we may sell more than 15% of advertising time on a separately owned television station in the same market. In August 2016, the FCC amended its ownership rules to provide for the attribution of such JSAs. The FCC subsequently adopted an Ownership Order on Reconsideration in 2017 and eliminated the JSA attribution rule. The Order on Reconsideration was appealed but ultimately upheld by the Supreme Court and became effective in June 2021. In December 2022, the FCC adopted the 2018 Quadrennial Ownership Order and declined to reconsider JSA attribution. The 2022 Quadrennial Regulatory Review proceeding remains pending. We have entered into JSAs whereby 3425 stations provide various non-programming related services such as sales, operational, and managerial services to other stations within the same markets. For additional information, refer to Television Markets and Stations within Item 1. Business. See Note 13.12. Variable Interest Entities within theSinclair’s Consolidated Financial Statements and Note 11. Variable Interest Entities within SBG’s Consolidated Financial Statements for further discussion of our JSAs which we consolidate as variable interest entities.

Certain of our stations have entered into LMAs pursuant to which we may provide programming to and sell advertising on a separately owned television station serving the same market. The FCC attributes LMAs to the programmer if the programmer provides more than 15% of a station’s weekly broadcast programming; provided, that, LMAs entered into prior to November 5, 1996, including ours, are currently exempt from attribution. The FCC may review these exempted LMAs in the future and if it determines to terminate or modify the exempt period and make all LMAs fully attributable we will be required to terminate or modify our exempted LMAs unless the FCC’s local ownership rules would permit us to own both stations. As of December 31, 2021,2025, we provide services under exempted LMAs to eightfive television stations owned by third parties. See Note 13.12. Variable Interest Entities within theSinclair’s Consolidated Financial Statements and Note 11. Variable Interest Entities within SBG’s Consolidated Financial Statements for further discussion of our LMAs which we consolidate as variable interest entities.

•Loss of revenues.revenue. If the FCC requires us to modify or terminate existing arrangements, we would lose some or all of the revenuesrevenue generated from those arrangements. We would lose revenue because we will have fewer demographic options, a smaller audience distribution and lower revenue share to offer to advertisers.

See Changes in the Rules of Television Ownership, Local Marketing Agreements, Joint Sales Agreements, Retransmission Consent Negotiations, and National Ownership Cap under Note 12.11. Commitments and Contingencies within theSinclair’s Consolidated Financial Statements and Note 10. Commitments and Contingencies within SBG’s Consolidated Financial Statements.

The FCC requires the owner / licensee of a station to maintain independent control over the programming and operations of the station. As a result, the owners / licensees of those stations with which we have outsourcing agreements can exert their control in ways that may be counter to our interests, including the right to preempt or terminate programming in certain instances. The preemption and termination rights cause some uncertainty as to whether we will be able to air all of the programming that we have purchased under our LMAs and therefore, uncertainty about the advertising revenue that we will receive from such programming. In addition, if the FCC determines that the owner / licensee is not exercising sufficient control, it may penalize the owner /licensee by a fine, revocation of the license for the station or a denial of the renewal of that license. Any one of these scenarios, especially the revocation of or denial of renewal of a license, might result in a reduction of our cash flow or margins and an increase in our operating costs. In addition, penalties might also affect our qualifications to hold FCC licenses, putting our own licenses at risk.

We have also invested in, and will continue to invest in, the development of other technologies and products. Product development is a costly, complex and time-consuming process, and the investment in product development often involves a long wait until a return, if any, is achieved on such investment. We continue to make significant investments in research and development relating to our technologies and products. Investments in new technologytechnologies and processes are inherently speculative. Technical obstacles and challenges we encounter in our research and development process may result in delays in or abandonment of product commercialization, substantially increase the costs of development and negatively affect our results of operations.

Pandemics, such as the COVID-19 pandemic,Pandemics and public health emergencies have affected and may, in the future, adversely affect our businesses. We experienced adverse business impacts relating to advertising sales, the suspension of content production, delays in the creation and availability of our programming, and other negative effects on our business during the COVID-19 pandemic. Additionally, if portions of our workforce, including key personnel, are unable to work effectively because of illness, government actions or other restrictions in connections with a pandemic or other public health emergency, there may be significant adverse effects on our business. In addition to the risks described above, a pandemic or other public health emergency may heighten other risks described in this section.

Our response to corporate social responsibility considerations, and compliance with laws and regulations related theretothereto, may adversely impact our business.

StateUntil recently, state and federal regulators, investors, consumers, and other stakeholders arewere increasingly focused on environmental, social, and governance (“ESG”) considerations. While we engage in various initiatives to help manage our corporate social responsibility profile and respond to stakeholder expectations, which continue to evolve, such initiatives can be costly and may not have the desired effect. As with other companies, our approach to such matters also evolves, and we cannot guarantee that our approach will align with the expectations or preferences of any particular stakeholder. Moreover, stakeholder expectations are not uniform, and both opponents and proponents of various ESG-related matters have increasingly resulted in a range of activism to advocate for their positions.

However, on January 21, 2025, President Trump issued an Executive Order requiring all federal agencies to terminate any policies establishing diversity, equity and inclusion (“DEI”)-based preferences, and to enforce federal civil rights laws to combat such preferences of entities operating in the private sector. Further, the Executive Order directs federal agencies to take appropriate action to discourage private sector DEI-based initiatives. While the enforceability of the Executive Order and the steps that various federal agencies may take in response to it are uncertain at this time, the Executive Order signals a material shift in federal DEI policy that reasonably can be expected to have implications for the private sector, including those in the communications industry, which is regulated by the FCC. In this regard, any scrutiny by federal government authorities of the Company’s corporate social responsibility practices, or those of the communications industry generally, may have a material adverse effect on us. Additionally, the increased SEC disclosure rules discussed above may be abandoned by new leadership at the SEC, new regulations might be implemented that limit ESG shareholder proposals that may be considered, and Congress may continue to conduct investigations into companies’ ESG initiatives and priorities.

We are required to evaluate our goodwill, indefinite-lived and definite-lived intangible assets for impairment. We evaluate our goodwill and indefinite-lived intangible assets for impairment annually, or more frequently, if events or changes in circumstances indicate an impairment may exist. For the year ended December 31, 2024,2025, we did not identify any indicators that our definite-lived intangible assets may not be recoverable or that our goodwill or indefinite-lived assets were impaired. However, future losses of Distributors, continued elevated level of subscriber erosion, and any other factors that cause a deterioration in our financial results could result in future impairments charges. For additional information regarding impairments to our goodwill and intangible assets, see Valuation of Goodwill and Indefinite-Lived Intangible Assets under Critical Accounting Policies and Estimates within Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note 4. Goodwill, Indefinite-Lived Intangible Assets, and Other Intangible Assets within theSinclair’s Consolidated Financial Statements and Note 4. Goodwill, Indefinite-Lived Intangible Assets, and Other Intangible Assets within SBG’s Consolidated Financial Statements.

We are subject to risks related to our use of Artificial Intelligence (AI), a new and emerging technology,AI, which is in the early stages of commercial use.

Significant divestitures by the Smiths could cause them to own or control less than 51% of the voting power of our shares, which in turn (i) could, as discussed under A failure to comply with covenants under debt instruments could result in a default under such debt instruments, acceleration of amounts due under our debtdebt, and loss of assets securing our loans within Item 1A. Risk Factors, under certain circumstances require us to offer to buy back some or all of ourthe outstanding STG 5.125% unsecured notes due 2027, the STG 5.500% unsecured notes due 2030, theSTG STG8.125% first-out first lien secured notes due 2033, theSTG STG4.375% second-out first lien secured notes due 2022,2032, and theSTG STG9.750% senior secured second lien notes due 2033 (the STG notes are collectively referred to as the “STG Notes”) and could result in an event of default under our new credit agreement as described under Liquidity and Capital Resources within Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations below (“New Credit Agreement”) and (ii) give Cunningham Broadcasting Corporation (“Cunningham”) the right to terminate the LMAs and other outsourcing agreements with Cunningham due to a “change in control.” Any such termination of LMAs could have an adverse effect on our results of operations. The FCC’s multiple ownership rules may limit our ability to operate multiple television stations in some markets and may result in a reduction in our revenue or prevent us from reducing costs. Changes in these rules may threaten our existing strategic approach to certain television markets. See the risk factor below regarding the FCC’s multiple ownership rules.

Our high level of debt poses risks, including the following risks, particularly in periods of declining revenuesrevenue:

•if our distribution and advertising revenuesrevenue decline, we may not be able to service our debt;

Despite our current level of debt, we and our subsidiaries may still be able to incur substantially more debt. This could further exacerbate the risks to our financial condition described herein.

Interest rates may increase in the future. As a result, interest rates on the obligations under the New Credit Agreement or other variable rate debt offerings could be higher or lower than current levels. As of December 31, 2024,2025, approximately $2,620$1,432 million principal amount of our debt relates to the credit agreement in effect as of the end of 2024 (the “BankNew Credit Agreement”) and is subject to variable interest rates. If interest rates increase, our debt service obligations on our variable rate debt would increase even though the amount borrowed remained the same, and our net income and cash flows, including cash available for servicing our debt, would correspondingly decrease. While we may continue to enter into interest rate hedging agreements with respect to our borrowings under certain credit agreements, such agreements are not expected to fully mitigate against interest rate risk.

In addition, we may fail to meet the tests and thereby default on one or more of our obligations (particularly if the economy weakens and reduces our advertising revenuesrevenue). If we default on our obligations, creditors could require immediate payment of the obligations or foreclose on collateral. If this happens, we could be forced to sell equity interests in our equity investments, broadcast stations or other assets or take other actions that could significantly reduce our value and we may not have sufficient assets or funds to pay our debt obligations.

•geopolitical conditions, including the war in Ukraine, conflicts in the Middle East and international trade sanctions, could negatively impact global supply prices and disrupt supply chain levels, which could negatively impact the operations of us, our customers’, our vendors’ and our Distributors’Distributors;

The following Management’s Discussion and Analysis provides qualitative and quantitative information about Sinclair’s and SBG’s financial performance and condition which should be read in conjunction with the other sections in this annual report, including Item 1. Business and thewithin Sinclair’s Consolidated Financial Statements and SBG’s Consolidated Financial Statements, including the accompanying notes to those statements. This discussion consists of the following sections:

Critical Accounting Policies and Estimates — a discussion of the accounting policies that are most important in understanding the assumptions and judgments incorporated inwithin theSinclair’s Consolidated Financial Statements and SBG’s Consolidated Financial Statements and a summary of recent accounting pronouncements;

Results of Operations — a summary of the components of Sinclair’s and SBG’s revenuesrevenue by category and by network affiliation, a summary of other operating data, and an analysis of Sinclair’s and SBG’s revenuesrevenue and expenses for 2025, 2024, 2023, and 2022,2023, including a comparison between 20242025 and 20232024; and Liquidity and Capital Resources — a discussion of Sinclair’s and SBG’s primary sources of liquidity and contractual cash obligations and an analysis of Sinclair’s and SBG’s cash flows from or used in operating activities, investing activities, and financing activities.

We are a diversified media company with national reach and a strong focus on providing high-quality content on our local television stations and digital platform. The content, distributed through our broadcast platform and third-party platforms, consists of programming provided by third-party networks and syndicators, local news, sports, and other original programming produced by us and our owned networks.networks, and professional sports. Additionally, we own digital media products that are complementary to our extensive portfolio of television station related digital propertiesproperties. and weWe have interests in, own, manage and/or operate technical and software services companies, research and development for the advancement of broadcast technology, and other media and non-media related businesses and assets, including real estate, venture capital, private equity, and direct investments.

As of December 31, 2024,2025, Sinclair had two reportable segments, local media and tennis, and SBG had one reportable segment, local media. Sinclair and SBG’s local media segment is comprised of our television stations, which are owned and/or operated by Sinclair and SBG’s wholly-owned subsidiary, Sinclair Television Group, Inc. (“STG”) and its direct and indirect subsidiaries, original networks and content. Sinclair’s tennis segment primarily consists of Tennis Channel, a cable network which includes coverage of many of tennis’ top tournaments and original professional sports and tennis lifestyle shows. Sinclair also earns revenuesrevenue from non-broadcast digital and internet services, technical services, and non-media investments, included within “other.” Other and corporate are not reportable segments for either Sinclair or SBG.

As of December 31, 2024,2025, STG, for which certain assets and results of operations are included in the local media segment and which is one of Sinclair and SBG’s wholly owned subsidiaries, was the primary obligor under the BankNew Credit Agreement and the STG Notes. SBG and substantially all of STG’s subsidiaries are guarantors under the STG debt instruments. Sinclair’s Class A Common Stock and Class B Common Stock remain securities of Sinclair and not obligations or securities of STG.

•In January 2025, SBGSinclair and NBC announced a comprehensive multi-year agreement that renews station affiliation agreements for 21 of SBG’s owned and/or operated NBC affiliates and affiliations in five markets where SBG provides sales and other services under a joint sales agreement or marketing service agreement.