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Angel Studios, Inc. 2025 Annual Report (10-K) Summary

Business Context and Reporting Period

This Form 10-K covers the fiscal year ended December 31, 2025. Angel Studios, Inc. (formerly Southport Acquisition Corporation) is a media and technology company operating a community-driven model via the "Angel Guild," which allows approximately 2.0 million paying members to vote on, fund, and distribute values-driven film and television content. The company completed a business combination with Southport Acquisition Corporation in September 2025. Its primary revenue streams include Angel Guild memberships, theatrical distribution, content licensing, and merchandise.

Key Financial Metrics (Year Ended Dec 31, 2025)

Material Changes vs. Prior Period

• Revenue Growth: Revenue increased 233% to $321.6 million, driven primarily by a 488% surge in Angel Guild revenue ($209.7 million) as membership grew from 0.6 million to 2.0 million. Theatrical revenue also rose 162% to $77.0 million due to successful releases including The King of Kings and David.
• Expense Expansion: Selling and marketing expenses jumped 220% to $297.3 million to support membership acquisition and theatrical marketing. Cost of revenues increased 181% to $124.9 million, largely due to higher royalties and transaction fees associated with membership growth.
• Debt Financing: Notes payable increased significantly from $11.5 million to $97.2 million. This includes a new $100 million credit facility (with $40 million drawn in 2025) and increased Print & Advertising (P&A) loans to fund theatrical releases.
• Bitcoin Strategy: The company adopted ASU 2023-08, measuring digital assets at fair value. While the number of Bitcoin held remained relatively stable, the carrying value increased due to fair value adjustments, though a net loss of $1.8 million was recorded on digital assets for the year.

Guidance, Outlook, and Risks

Outlook: Management expects to continue funding operations through 2026 via debt issuance, equity offerings, and recurring Angel Guild revenue. The company has a strong pipeline of theatrical releases scheduled for 2026, including I Was a Stranger, Solo Mio, and Animal Farm. A second tranche of $20 million from the credit facility was drawn in February 2026.

Key Risks:

• Going Concern: The company reported a net loss of $170.5 million and an accumulated deficit of $241.5 million. Continued profitability is not guaranteed, and future capital raises may be necessary.
• Disney Settlement Agreement: The company remains subject to a settlement agreement with major studios. Four instances of unauthorized use of copyrighted material within a five-year period could trigger enforcement actions, potentially resulting in the loss of all equity held by founders and foreclosure on assets.
• Bitcoin Volatility: The company's financial results and stock price are significantly exposed to Bitcoin price fluctuations. A significant decrease in Bitcoin value could impair liquidity and the ability to satisfy financial obligations.
• Content Dependency: Revenue is heavily reliant on the success of specific theatrical releases and the ability to retain Angel Guild members.

Investor Verification Checklist

• Verify the sustainability of the 233% revenue growth and the retention rate of the 2.0 million Angel Guild members.
• Review the terms of the $100 million credit facility, specifically the covenants regarding minimum annualized recurring revenue and liquidity requirements.
• Assess the impact of the Bitcoin treasury strategy on the balance sheet and the potential for forced liquidation if Bitcoin prices decline.
• Monitor compliance with the Disney Settlement Agreement to ensure no "strikes" occur that could jeopardize the company's existence.
• Confirm the execution and financial impact of the pending mergers with Black Autumn Show (Homestead), Toothy Cow Productions (Wingfeather Saga), and Tuttle Twins Show.