Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-39312

PLBY Group, Inc.

(Exact name of registrant as specified in its charter)


Delaware		37-1958714
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
	10960 Wilshire Blvd., Suite 2200
	Los Angeles, California 90024
(Address of principal executive offices including zip code)
Registrant’s telephone number, including area code: (310) 424-1800

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $0.0001 par value per share	PLBY	Nasdaq Global Market

Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	£	Accelerated filer	☒
Non-accelerated filer	£	Smaller reporting company	☒
		Emerging growth company	£

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of Registrant’s Common Stock outstanding as of August 5, 2024 was 73,892,060.

TABLE OF CONTENTS


			Page
Part I - Financial Information
Item 1. Unaudited Condensed Consolidated Financial Statements
Condensed Consolidated Statements of Operations			1
Condensed Consolidated Statements of Comprehensive Loss			2
Condensed Consolidated Balance Sheets			3
Condensed Consolidated Statements of Stockholders’ Equity			4
Condensed Consolidated Statements of Cash Flows			6
Notes to the Unaudited Condensed Consolidated Financial Statements			8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			26
Item 3. Quantitative and Qualitative Disclosures About Market Risk			44
Item 4. Controls and Procedures			45
Part II - Other Information
Item 1. Legal Proceedings			48
Item 1A. Risk Factors			48
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			48
Item 3. Defaults Upon Senior Securities			48
Item 4. Mine Safety Disclosures			49
Item 5. Other Information			49
Item 6. Exhibits			49
Signatures			50

Part I. FINANCIAL INFORMATION

Item 1. Unaudited Condensed Consolidated Financial Statements.

PLBY Group, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

(in thousands, except share and per share amounts)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net revenues	$	24,885	$	35,101	$	53,204	$	70,304
Costs and expenses:
Cost of sales	(8,018)		(9,659)		(20,525)		(31,436)
Selling and administrative expenses	(25,489)		(32,517)		(47,801)		(73,912)
Impairments	(599)		(146,240)		(3,016)		(146,240)
Other operating income, net	18		259		18		249
Total operating expense	(34,088)		(188,157)		(71,324)		(251,339)
Operating loss	(9,203)		(153,056)		(18,120)		(181,035)
Nonoperating (expense) income:
Interest expense	(6,588)		(5,757)		(13,015)		(10,966)
Gain on extinguishment of debt	—		7,980		—		6,133
Fair value remeasurement gain	—		9,523		—		6,505
Other (expense) income, net	(245)		175		(295)		250
Total nonoperating (expense) income	(6,833)		11,921		(13,310)		1,922
Loss from continuing operations before income taxes	(16,036)		(141,135)		(31,430)		(179,113)
(Expense) benefit from income taxes	(616)		8,868		(1,669)		10,538
Net loss from continuing operations	(16,652)		(132,267)		(33,099)		(168,575)
Income (loss) from discontinued operations, net of tax	—		452		—		(920)
Net loss	(16,652)		(131,815)		(33,099)		(169,495)
Net loss attributable to PLBY Group, Inc.	$	(16,652)	$	(131,815)	$	(33,099)	$	(169,495)
Net loss per share from continuing operations, basic and diluted	$	(0.23)	$	(1.77)	$	(0.45)	$	(2.41)
Net income (loss) per share from discontinued operations, basic and diluted	—		0.01		—		(0.01)
Net loss per share, basic and diluted	$	(0.23)	$	(1.76)	$	(0.45)	$	(2.42)
Weighted-average shares outstanding, basic and diluted	73,040,566		74,916,379		72,859,533		70,129,055

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PLBY Group, Inc.

Condensed Consolidated Statements of Comprehensive Loss

(Unaudited)

(in thousands)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net loss	$	(16,652)	$	(131,815)	$	(33,099)	$	(169,495)
Other comprehensive loss:
Foreign currency translation adjustment	848		(272)		(885)		(1,968)
Other comprehensive income (loss)	848		(272)		(885)		(1,968)
Comprehensive loss	$	(15,804)	$	(132,087)	$	(33,984)	$	(171,463)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PLBY Group, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(in thousands, except share and per share amounts)


	June 30, 2024		December 31, 2023
Assets
Current assets:
Cash and cash equivalents	$	16,850	$	28,120
Restricted cash	100		1,587
Receivables, net of allowance for credit losses	5,724		7,496
Inventories, net	10,355		13,000
Prepaid expenses and other current assets	7,104		7,802
Assets held for sale	7,325		11,692
Total current assets	47,458		69,697
Restricted cash	1,908		1,969
Property and equipment, net	10,943		13,514
Operating right-of-use assets	20,894		25,284
Goodwill	54,456		54,899
Other intangible assets, net	157,166		157,901
Contract assets, net of current portion	8,014		8,716
Other noncurrent assets	950		2,274
Total assets	$	301,789	$	334,254
Liabilities, Redeemable Noncontrolling Interest and Stockholders’ Equity
Current liabilities:
Accounts payable	$	14,023	$	14,500
Deferred revenues, current portion	9,583		9,205
Long-term debt, current portion	304		304
Operating lease liabilities, current portion	6,438		6,955
Other current liabilities and accrued expenses	22,514		27,967
Total current liabilities	52,862		58,931
Deferred revenues, net of current portion	4,755		4,641
Long-term debt, net of current portion	195,948		190,115
Deferred tax liabilities, net	11,149		9,304
Operating lease liabilities, net of current portion	20,628		24,621
Other noncurrent liabilities	970		957
Total liabilities	286,312		288,569
Commitments and contingencies (Note 11)
Redeemable noncontrolling interest	(208)		(208)
Stockholders’ equity:
Preferred stock, $0.0001 par value per share, 5,000,000 shares authorized, 50,000 shares designated Series A preferred stock, of which 0 shares were issued and outstanding as of June 30, 2024 and December 31, 2023	—		—
Common stock, $0.0001 par value per share, 150,000,000 shares authorized, 75,503,774 shares issued and 73,253,845 shares outstanding as of June 30, 2024; 74,783,683 shares issued and 72,533,754 shares outstanding as of December 31, 2023	7		7
Treasury stock, at cost, 2,249,929 shares as of June 30, 2024 and December 31, 2023	(5,445)		(5,445)
Additional paid-in capital	693,894		690,055
Accumulated other comprehensive loss	(25,795)		(24,910)
Accumulated deficit	(646,976)		(613,814)
Total stockholders’ equity	15,685		45,893
Total liabilities, redeemable noncontrolling interest and stockholders’ equity	$	301,789	$	334,254

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PLBY Group, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)

(in thousands, except share amounts)


	Three Months Ended June 30, 2024
	Series A Preferred Stock			Common Stock
	Shares	Amount		Shares	Amount		Treasury Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Income		Accumulated Deficit		Total
Balance at March 31, 2024	—	$	—	72,643,445	$	7	$	(5,445)	$	691,889	$	(26,643)	$	(630,261)	$	29,547
Shares issued in connection with equity incentive plans	—	—		610,400	—		—		—		—		—		—
Stock-based compensation expense and vesting of restricted stock units	—	—		—	—		—		2,005		—		—		2,005
Other	—	—		—	—		—				—		(63)		(63)
Other comprehensive income	—	—		—	—		—		—		848		—		848
Net loss	—	—		—	—		—		—		—		(16,652)		(16,652)
Balance at June 30, 2024	—	$	—	73,253,845	$	7	$	(5,445)	$	693,894	$	(25,795)	$	(646,976)	$	15,685


	Three Months Ended June 30, 2023
	Series A Preferred Stock			Common Stock
	Shares	Amount		Shares	Amount		Treasury Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total
Balance at March 31, 2023	50,000	$	—	73,174,547	$	7	$	(4,445)	$	684,643	$	(25,841)	$	(471,076)	$	183,288
Exchange of mandatorily redeemable preferred shares	(50,000)	—		—	—		—		—		—		—		—
Shares issued in connection with equity incentive plans	—	—		622,703	—		—		—		—		—		—
Stock-based compensation expense and vesting of restricted stock units	—	—		—	—		—		3,637		—		—		3,637
Other comprehensive loss	—	—		—	—		—		—		(272)		—		(272)
Net loss	—	—		—	—		—		—		—		(131,815)		(131,815)
Balance at June 30, 2023	—	$	—	73,797,250	$	7	$	(4,445)	$	688,280	$	(26,113)	$	(602,891)	$	54,838

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PLBY Group, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)

(in thousands, except share amounts)


	Six Months Ended June 30, 2024
	Series A Preferred Stock			Common Stock
	Shares	Amount		Shares	Amount		Treasury Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total
Balance at December 31, 2023	—	$	—	72,533,754	$	7	$	(5,445)	$	690,055	$	(24,910)	$	(613,814)	$	45,893
Shares issued in connection with equity incentive plans	—	—		720,091	—		—		—		—		—		—
Stock-based compensation expense and vesting of restricted stock units	—	—		—	—		—		3,839		—		—		3,839
Other	—	—		—	—		—		—		—		(63)		(63)
Other comprehensive loss	—	—		—	—		—		—		(885)		—		(885)
Net loss	—	—		—	—		—		—		—		(33,099)		(33,099)
Balance at June 30, 2024	—	$	—	73,253,845	$	7	$	(5,445)	$	693,894	$	(25,795)	$	(646,976)	$	15,685


	Six Months Ended June 30, 2023
	Series A Preferred Stock			Common Stock
	Shares	Amount		Shares	Amount		Treasury Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total
Balance at December 31, 2022	50,000	$	—	47,037,699	$	5	$	(4,445)	$	617,233	$	(24,145)	$	(433,396)	$	155,252
Issuance of common stock in rights offering	—	—		19,561,050	2		—		47,600		—		—		47,602
Issuance of common stock in registered direct offering	—	—		6,357,341	—		—		13,890		—		—		13,890
Exchange of mandatorily redeemable preferred shares	(50,000)	—		—	—		—		—		—		—		—
Shares issued in connection with equity incentive plans	—	—		837,848	—		—		—		—		—		—
Shares issued pursuant to a license, services and collaboration agreement	—	—		3,312	—		—		—		—		—		—
Stock-based compensation expense and vesting of restricted stock units	—	—		—	—		—		9,557		—		—		9,557
Other comprehensive loss	—	—		—	—		—		—		(1,968)		—		(1,968)
Net loss	—	—		—	—		—		—		—		(169,495)		(169,495)
Balance at June 30, 2023	—	$	—	73,797,250	$	7	$	(4,445)	$	688,280	$	(26,113)	$	(602,891)	$	54,838

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PLBY Group, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(in thousands)


	Six Months Ended June 30,
	2024		2023
Cash Flows From Operating Activities
Net loss	$	(33,099)	$	(169,495)
Net loss from continuing operations	$	(33,099)	$	(168,575)
Income (loss) from discontinued operations, net of tax	$	—	$	(920)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	4,311		3,537
Stock-based compensation	3,839		8,370
Fair value measurement of liabilities	(56)		(6,772)
Gain on extinguishment of debt	—		(6,133)
Impairments	3,016		146,240
Inventory reserve charges	(852)		5,860
Amortization of right-of-use assets	4,271		1,676
Capitalized paid-in-kind interest	3,703		—
Amortization of debt issuance costs	2,212		1,183
Deferred income taxes	1,833		(9,841)
Other	509		(90)
Changes in operating assets and liabilities:
Receivables, net	1,781		(3,062)
Inventories	4,282		4,949
Contract assets	129		(14,947)
Prepaid expenses and other assets	921		2,353
Accounts payable	(296)		(1,341)
Deferred revenues	521		14,440
Operating lease liabilities	(4,971)		(1,795)
Other	(4,834)		(2,705)
Net cash used in operating activities from continuing operations	(12,780)		(26,653)
Net cash provided by operating activities from discontinued operations	—		30
Net cash used in operating activities	(12,780)		(26,623)
Cash Flows From Investing Activities
Purchases of property and equipment	(1,244)		(752)
Proceeds from sale of artwork	1,572		—
Proceeds from sale of Yandy	—		1,000
Net cash provided by investing activities - continuing operations	328		248
Net cash used in investing activities - discontinued operations	—		(68)
Net cash provided by investing activities	328		180
Cash Flows From Financing Activities
Proceeds from issuance of common stock in rights offering, net	—		47,600
Proceeds from issuance of common stock in registered direct offering, net	—		13,890
Proceeds from issuance of long-term debt	—		11,828
Repayment of long-term debt	(152)		(45,476)
Payment of financing costs	—		(508)
Other	(63)		—
Net cash (used in) provided by financing activities - continuing operations	(215)		27,334
Effect of exchange rate changes on cash and cash equivalents	(151)		19
Net (decrease) increase in cash and cash equivalents and restricted cash	(12,818)		910
Balance, beginning of year	$	31,676	$	35,449
Balance, end of period	$	18,858	$	36,359
Cash and cash equivalents and restricted cash consist of:
Cash and cash equivalents	$	16,850	$	34,404
Restricted cash	2,008		1,955
Total	$	18,858	$	36,359

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PLBY Group, Inc.

Condensed Consolidated Statements of Cash Flows (continued)

(Unaudited)

(in thousands)


	Six Months Ended June 30,
	2024		2023
Supplemental Disclosures
Cash paid (refunded) for income taxes	$	717	$	(749)
Cash paid for interest	$	6,981	$	8,853
Supplemental Disclosure of Non-Cash Activities
Right-of-use assets in exchange for lease liabilities - continuing operations	$	600	$	2,400
Right-of-use assets in exchange for lease liabilities - discontinued operations	$	—	$	885
Shares issued pursuant to a license, services and collaboration agreement	$	—	$	236

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PLBY Group, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

1. Basis of Presentation and Summary of Significant Accounting Policies

Description of Business

PLBY Group, Inc. (the “Company”, “PLBY”, “we”, “our” or “us”), together with its subsidiaries through which it conducts business, is a global consumer lifestyle company marketing the Playboy brand through a wide range of direct-to-consumer products, licensing initiatives, digital subscriptions and content, and online and location-based entertainment businesses, in addition to the sale of direct-to-consumer products through its Honey Birdette brand.

We have three reportable segments: Direct-to-Consumer, Licensing, and Digital Subscriptions and Content. Refer to Note 15, Segments.

Basis of Presentation

The interim condensed consolidated financial statements and accompanying notes were prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).

The Yandy Enterprises LLC (“Yandy”) and TLA Acquisition Corp. (“TLA”, owner of the Lovers business) disposal groups, previously included in the Direct-to-Consumer segment in the prior year comparative period, were classified as discontinued operations in the condensed consolidated statements of operations for the prior year comparative period presented. The sale of Yandy was completed on April 4, 2023 (the “Yandy Sale”). The sale of TLA was completed on November 3, 2023 (the “TLA Sale”).

Principles of Consolidation

The interim condensed consolidated financial statements include our accounts and all majority-owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation.

The Company follows a monthly reporting calendar, with its fiscal year ending on December 31.

Unaudited Interim Condensed Consolidated Financial Statements

The interim condensed consolidated balance sheet as of June 30, 2024, and the interim condensed consolidated statements of operations, comprehensive loss, cash flows, and stockholders’ equity for the three and six months ended June 30, 2024 and 2023 are unaudited. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and reflect, in the opinion of management, all adjustments of a normal and recurring nature that are necessary for the fair statement of our financial position as of June 30, 2024 and our results of operations and cash flows for the three and six months ended June 30, 2024 and 2023. The financial data and other financial information disclosed in these notes to the interim condensed consolidated financial statements related to the three and six-month periods are also unaudited. The interim condensed consolidated results of operations for the six months ended June 30, 2024 are not necessarily indicative of the results to be expected for the year ending December 31, 2024 or for any future annual or interim period. The interim condensed consolidated balance sheet as of December 31, 2023 included herein was derived from the audited financial statements as of that date. These interim condensed consolidated financial statements should be read in conjunction with our audited financial statements included in the Annual Report on Form 10-K as filed by us with the U.S. Securities and Exchange Commission (the “SEC”) on March 29, 2024.

Reclassifications

Certain prior period amounts in the condensed consolidated statements of operations and condensed consolidated balance sheets have been reclassified to conform with the current period presentation.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

We regularly assess these estimates, including, but not limited to, valuation of our trademarks and trade names; valuation of our contingent consideration liabilities; valuation of our only authorized and issued preferred stock (our “Series A Preferred Stock”), with the previously outstanding Series A Preferred Stock having been exchanged for debt and thereby eliminated in May 2023 upon amendment and restatement of our senior secured debt; pay-per-view and video-on-demand buys, and monthly subscriptions to our television and digital content; the adequacy of reserves associated with accounts receivable and inventory; unredeemed gift cards and store credits; licensing commission accruals; and stock-based compensation expense. We base these estimates on historical experience and on various other market-specific and relevant assumptions that we believe to be reasonable under the circumstances. Actual results could differ from these estimates and such differences could be material to the financial position and results of operations.

Concentrations of Business and Credit Risk

We maintain certain cash balances in excess of Federal Deposit Insurance Corporation insured limits. We periodically evaluate the credit worthiness of the financial institutions with which we maintain cash deposits. We have not experienced any losses in such accounts and do not believe that there is any credit risk to our cash. Concentration of credit risk with respect to accounts receivable is limited due to the wide variety of customers to whom our products are sold and/or licensed.

There were no receivables from our customers exceeding 10% of our total as of June 30, 2024 and December 31, 2023.

The following table represents revenue from our customers exceeding 10% of our total revenue, excluding revenues from discontinued operations:


	Three Months Ended June 30,			Six Months Ended June 30,
Customer	2024	2023		2024	2023
Customer A(1)	*	15	%	*	15	%
_________________ (1) The agreement with this licensee was terminated in the fourth quarter of 2023. *Indicates revenues for the customer did not exceed 10% of our total for the three and six months ended June 30, 2024.

Restricted Cash

At June 30, 2024 and December 31, 2023, restricted cash was primarily related to a cash collateralized letter of credit we maintained in connection with the lease of our Los Angeles headquarters and Honey Birdette’s term deposit in relation to its Sydney office lease. The December 31, 2023 restricted cash balance also included cash held in escrow related to the TLA Sale, which had been released to us in full as of June 30, 2024.

Liquidity Assessment and Management’s Plans

Our revenues, results of operations and cash flows have been materially adversely impacted by negative macroeconomic factors beginning in the second quarter of 2022 and continuing through the second quarter of 2024. The persistently challenging macroeconomic and retail environments, including reduced consumer spending and increased price sensitivity in discretionary categories, has significantly impacted our licensees’ performance. Our net revenues from continuing operations for the three and six months ended June 30, 2024 decreased by $10.2 million and $17.1 million, compared to the three and six months ended June 30, 2023, respectively, and this decline, coupled with investments into our creator platform, drove our operating loss and net loss. For the three and six months ended June 30, 2024, we reported a net operating loss from continuing operations of $9.2 million and $18.1 million, respectively, and negative operating cash flows from continuing operations of $12.8 million for the six months ended June 30, 2024. As of June 30, 2024, we had approximately $16.9 million in unrestricted cash and cash equivalents.

We expect our capital expenditures and working capital requirements in 2024 to be largely consistent with 2023, as we continue to invest in our creator platform. We may, however, need additional cash resources to fund our operations until the creator platform achieves a level of revenue that provides for operating profitability. To the extent that our current resources are insufficient to satisfy our cash requirements, we may need to seek additional equity or debt financing, or dispose of additional assets, and there can be no assurance that we will be successful in these efforts. If the financing is not available, or if the terms of financing are less desirable than we expect, we may be forced to decrease our planned level of investment in our creator platform or scale back its operations, which could have an adverse impact on our business and financial prospects.

We evaluated whether there are any conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern over the next twelve months from the date of filing this Quarterly Report on Form 10-Q. Although consequences of ongoing macroeconomic uncertainty could adversely affect our liquidity and capital resources in the future, and cash requirements may fluctuate based on the timing and extent of many factors, such as those discussed above, we believe our existing sources of liquidity, along with proceeds from asset dispositions and savings from cost reductions initiatives, will be sufficient to meet our obligations as they become due under the A&R Credit Agreement (as such term is defined in Note 8, Debt) and our other obligations for at least one year following the date of the filing of this Quarterly Report on Form 10-Q. We may seek additional equity or debt financing in the future to satisfy capital requirements, respond to adverse developments such as changes in our circumstances or unforeseen events or conditions, or fund organic or inorganic growth opportunities. However, in the event that additional financing is required from third-party sources, we may not be able to raise it on acceptable terms or at all.

As of June 30, 2024, we were in compliance with the covenants under our senior secured credit agreement. However, due to ongoing negative macroeconomic factors and their uncertain impacts on our business, results of operations and cash flows, we could experience further material decreases to net sales and operating cash flows and materially higher operating losses, and may experience difficulty remaining in compliance with such covenants. Refer to Note 8, Debt, for further details regarding the terms of our A&R Credit Agreement and the A&R Term Loans (as such terms are defined in Note 8, Debt).

The accompanying unaudited condensed consolidated financial statements are prepared in accordance with GAAP applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

Advertising Costs

We expense advertising costs as incurred. Advertising expenses were $1.1 million and $1.4 million for the three months ended June 30, 2024 and 2023, respectively, excluding $0.3 million of advertising costs related to discontinued operations for the three months ended June 30, 2023. Advertising expenses for the six months ended June 30, 2024 and 2023 were $2.1 million and $3.7 million, respectively, excluding $2.3 million of advertising costs related to discontinued operations for the six months ended June 30, 2023. We also have various arrangements with collaborators pursuant to which we reimburse them for a portion of their advertising costs in the form of co-op marketing which provide advertising benefits to us. The costs that we incur for such advertising costs are recorded as a reduction of revenue.

Long-Lived Assets, Indefinite-lived Intangible Assets and Goodwill

The carrying amounts of long-lived assets, including property and equipment, stores, acquired intangible assets and right-of-use operating lease assets are periodically reviewed for indicators of impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable or that the useful life is shorter than originally estimated. We recognized $0.6 million of impairment charges on right-of-use assets pertaining to our corporate leases during the three months ended June 30, 2024.

In the second quarter of 2024, we had impairment indicators to our direct-to-consumer business, causing us to perform a quantitative impairment test for our indefinite-lived and amortizable intangibles, including goodwill, as of June 30, 2024. The quantitative impairment test for indefinite-lived and amortizable intangibles, including goodwill, indicated that their carrying values were less than the fair values, therefore, there were no impairment charges to be recognized on our intangibles, including goodwill during the three and six months ended June 30, 2024. We recognized $5.1 million of impairment charges on our trade names at the impairment date in the second quarter of 2023.

Indefinite-lived intangible assets that are not amortized but subject to annual impairment testing consist of Playboy-branded trademarks. Our indefinite-lived Playboy-branded trademarks are periodically reviewed for indicators of impairment whenever events or changes in circumstances indicate that the value of these assets may not be recoverable or that the useful life is shorter than originally estimated.

We evaluate the indefinite-lived Playboy-branded trademarks for impairment using the discounted cash flow and relief from royalty method. This valuation approach requires that we make a number of assumptions to estimate fair value, including projections of future revenues, market royalty rates, tax rates, discount rates and other relevant variables. The projections we use in the model are updated annually or more frequently if an impairment triggering event has been identified and will change over time based on the historical performance and changing business conditions. If the carrying value of the trademark exceeds its estimated fair value, an impairment charge is recognized for the excess amount. There were no impairment charges to Playboy-branded trademarks to be recognized during the three and six months ended June 30, 2024. In the second quarter of 2023, we experienced declines in revenue and profitability, causing us to test the recoverability of our indefinite-lived assets as of June 30, 2023. The impairment charges on the indefinite-lived Playboy-branded trademarks were $65.5 million as of the impairment date in the second quarter of 2023.

We perform annual impairment testing on goodwill in the fourth quarter of each fiscal year or when events occur or circumstances change that would, more likely than not, reduce the fair value of a reporting unit below its carrying value. We may first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If we determine it is more likely than not that the fair value of the reporting unit is greater than its carrying amount, an impairment test is unnecessary. If an impairment test is necessary, we will estimate the fair value of a related reporting unit. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is determined to be impaired, and we will proceed with recording an impairment charge equal to the excess of the carrying value over the related fair value. If we determine it is more likely than not that goodwill is not impaired, a quantitative test is not necessary.

There were no impairment charges to goodwill to be recognized during the three and six months ended June 30, 2024. In the second quarter of 2023, we experienced declines in revenue and profitability, causing us to test our goodwill for impairment as of June 30, 2023. Utilizing the income approach, we performed a quantitative impairment test on goodwill using a discounted cash flow analysis, which determined that the carrying value of certain of our reporting units exceeded their fair value. As a result, we recognized $66.7 million of impairment charges on our goodwill at the impairment date in the second quarter of 2023.

Gift Card Liabilities

We account for gift cards sold to customers by recording a liability in other current liabilities and accrued expenses in our consolidated balance sheets at the time of sale, which is recognized as revenue when redeemed or when we have determined the likelihood of redemption to be remote, which is referred to as gift card breakage. Depending on the jurisdiction in which we operate, gift cards sold to customers have expiration dates ranging from three to five years from the date of sale, or they do not expire and may be subject to escheatment rights. Our gift card liability totaled $1.7 million, $1.6 million and $1.6 million as of June 30, 2024, December 31, 2023 and December 31, 2022, respectively. Revenues recognized that were included in gift card liabilities at the beginning of the period were $0.5 million and $0.7 million for the six months ended June 30, 2024 and 2023, respectively.

Comprehensive Loss

Comprehensive loss consists of net loss and other gains and losses affecting stockholders’ equity that, under GAAP, are excluded from net loss. Our other comprehensive income (loss) represents foreign currency translation adjustments attributable to Honey Birdette’s operations. Refer to the Condensed Consolidated Statements of Comprehensive Loss. Total foreign currency transaction gains and losses were immaterial for the three and six months ended June 30, 2024 and 2023.

Recently Adopted Accounting Pronouncements

There were no recently adopted accounting pronouncements applicable to the Company for the quarter ended June 30, 2024.

Accounting Pronouncements Issued but Not Yet Adopted

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. All disclosure requirements under ASU 2023-07 are also required for public entities with a single reportable segment. The ASU’s amendments are effective for all public entities for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the impact of this pronouncement on our disclosures.

In December 2023, the FASB issued ASU 2023-08, Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets, which addresses the accounting and disclosure requirements for certain crypto assets. This ASU requires entities to subsequently measure certain crypto assets at fair value, with changes in fair value recorded in net income in each reporting period. In addition, entities are required to provide additional disclosures about the holdings of certain crypto assets. The ASU’s amendments are effective for all entities holding assets that meet certain scope criteria for fiscal years beginning after December 15, 2024, including interim periods within those years. Early adoption is permitted for both interim and annual periods. If an entity adopts the amendments in an interim period, it must adopt them as of the beginning of the fiscal year that includes that interim period. We do not expect this pronouncement to have a material impact on our financial statements, and are currently evaluating its impact on our disclosures and consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. Under this ASU, public entities must annually (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than five percent of the amount computed by multiplying pretax income or loss by the applicable statutory income tax rate). This ASU’s amendments are effective for all entities that are subject to Topic 740, Income Taxes, for annual periods beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the impact of this pronouncement on our disclosures.

2. Fair Value Measurements

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. We apply the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

Level 1 inputs: Based on unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2 inputs: Based on observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 inputs: Based on unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities, and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability.

For cash equivalents, receivables and certain other current assets and liabilities at June 30, 2024 and December 31, 2023, the amounts reported approximate fair value (Level 1) due to their short-term nature. For debt, based upon the refinancing of our senior secured debt in May 2021, its amendments in 2021 and 2022, as well as its further amendment and restatement in 2023, we believe that its carrying value at June 30, 2024 and December 31, 2023 approximates fair value, as our debt is variable-rate debt that reprices to current market rates frequently. Refer to Note 8, Debt, for additional disclosures about our debt. Our debt is classified within Level 2 of the valuation hierarchy.

Liabilities Measured and Recorded at Fair Value on a Recurring Basis

The following table summarizes the fair value of our financial liabilities measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands):


	June 30, 2024
	Level 1		Level 2		Level 3		Total
Liabilities
Contingent consideration liability	$	—	$	—	$	(343)	$	(343)


	December 31, 2023
	Level 1		Level 2		Level 3		Total
Liabilities
Contingent consideration liability	$	—	$	—	$	(399)	$	(399)

There were no transfers of financial instruments between Level 1, Level 2, and Level 3 during the periods presented.

Contingent consideration liability relates to the contingent consideration recorded in connection with the 2021 acquisition of GlowUp Digital Inc. (“GlowUp”), which represents the fair value for shares which may be issued and cash which may be paid to the GlowUp sellers, subject to certain indemnification obligations that remained unsettled as of June 30, 2024 and December 31, 2023. The fair value of such shares is remeasured each reporting date using the PLBY stock price as of each reporting date. Fair value change as a result of contingent liabilities fair value remeasurement during the three and six months ended June 30, 2024 and 2023 was immaterial. We classified financial liabilities associated with the contingent consideration as Level 3 due to the lack of relevant observable inputs. Changes in assumptions described above could have an impact on the payout of contingent consideration.

Our Series A Preferred Stock liability, initially valued as of May 16, 2022 (the initial issuance date), and our subsequent Series A Preferred Stock liability, valued as of the August 8, 2022 (the final issuance date), were each calculated using a stochastic interest rate model implemented in a binomial lattice, in order to incorporate the various early redemption features. The fair value option was elected for Series A Preferred Stock liability, as we believe fair value best reflects the expected future economic value. Such liabilities are subsequently remeasured to fair value for each reporting date using the same valuation methodology as originally applied with updated input assumptions. Financial liabilities associated with our Series A Preferred Stock were classified as Level 3 due to the lack of relevant observable inputs. We recorded $9.5 million and $6.5 million of fair value gain in nonoperating income as a result of remeasurement of the fair value of our Series A Preferred Stock during the three and six months ended June 30, 2023, respectively. In May 2023, in connection with the amendment and restatement of our senior secured credit agreement, the outstanding Series A Preferred Stock was exchanged for debt (and thereby eliminated). Refer to Note 8, Debt, for further details.

The following table provides a roll-forward of the fair value of the liabilities categorized as Level 3 for the six months ended June 30, 2024 (in thousands):


	Contingent Consideration
Balance at December 31, 2023	$	399
Change in fair value	(56)
Balance at June 30, 2024	$	343

The decrease in the fair value of the contingent consideration for the six months ended June 30, 2024 was primarily due to a decrease in a price per share of our common stock.

Assets Held for Sale

We began the sale of artwork assets in the fourth quarter of 2023, but they were not fully disposed of as of December 31, 2023 and June 30, 2024, and as such continued to be classified as current assets held for sale in our condensed consolidated balance sheet as of June 30, 2024.

We initially measure an asset that is classified as held for sale at the lower of its carrying amount or fair value less costs to sell. We assess the fair value of an asset less costs to sell each reporting period that it remains classified as held for sale, and report any subsequent changes as an adjustment to the carrying amount of the asset. Assets are not depreciated or amortized while they are classified as held for sale.

The assumptions used in measuring fair value of our artwork held for sale are considered Level 2 inputs, which include market prices obtained from recent auctions of similar works of art, or management’s judgment as to their salable value. There were no impairment charges on artwork held for sale recorded during the three months ended June 30, 2024. During the six months ended June 30, 2024, we recorded $2.4 million of impairment charges related to our artwork held for sale.

Assets Measured and Recorded at Fair Value on a Non-recurring Basis

In addition to liabilities that are recorded at fair value on a recurring basis, we record assets and liabilities at fair value on a nonrecurring basis. Generally, our non-financial instruments, which primarily consist of goodwill, intangible assets, including digital assets, right-of-use assets and property and equipment, are not required to be measured at fair value on a recurring basis and are reported at carrying value. However, on a periodic basis, or whenever events or changes in circumstances indicate that their carrying value may not be fully recoverable (and at least annually for goodwill and indefinite-lived intangible assets), non-financial instruments are assessed for impairment and, if applicable, written-down to and recorded at fair value, considering market participant assumptions. Recognized losses related to the impairment of our digital assets during the three and six months ended June 30, 2024 and 2023 were immaterial, and the fair value of our digital assets was immaterial as of June 30, 2024 and December 31, 2023. Fair value of digital assets held are predominantly based on Level 1 inputs.

3. Revenue Recognition

Contract Balances

Our contract assets relate to our trademark licensing revenue stream, which arrangements are typically long-term and non-cancelable. Contract assets are reclassified to accounts receivable when the right to bill becomes unconditional. Our contract liabilities consist of billings or payments received in advance of revenue recognition and are recognized as revenue when transfer of control to customers has occurred. Contract assets and contract liabilities are netted on a contract-by-contract basis. Contract liabilities are classified as deferred revenue in the consolidated balance sheets as of June 30, 2024 and December 31, 2023.

The following table summarizes our contract assets and certain contract liabilities (in thousands). Such table excludes $4.2 million of accounts receivable included in assets held for sale in our consolidated balance sheets as of December 31, 2022, and $0.3 million of contract liabilities included in liabilities held for sale in our consolidated balance sheet as of December 31, 2022.


	June 30, 2024		December 31, 2023		December 31, 2022
Accounts receivable	$	5,724	$	7,496	$	14,214
Contract Balances:
Contract assets, current portion	$	2,120	$	1,547	$	2,559
Contract assets, net of current portion	8,014		8,716		13,680
Contract liabilities, current portion	(9,583)		(9,205)		(10,480)
Contract liabilities, net of current portion	(4,755)		(4,641)		(21,406)
Contract liabilities, net	$	(4,204)	$	(3,583)	$	(15,647)

The following tables provide a roll-forward of our netted contract assets and contract liabilities from continuing operations (in thousands):


	Contract Liabilities, Net
Balance at December 31, 2023	$	(3,583)
Revenues recognized that were included in gross contract liabilities at December 31, 2023	13,195
Contract assets reclassified to accounts receivable in the six months ended June 30, 2024	(11,882)
Cash received in advance since prior year and remains in net contract liabilities at period-end	(1,934)
Balance at June 30, 2024	$	(4,204)


	Contract Liabilities, Net
Balance at December 31, 2022	$	(15,647)
Revenues recognized that were included in gross contract liabilities at December 31, 2022	22,065
Contract assets reclassified to accounts receivable in the six months ended June 30, 2023	(22,529)
Cash received in advance since prior year and remained in net contract liabilities at period-end	(2,356)
Write-down of contract liabilities due to impairment of a trademark licensing agreement	3,150
Contract impairments, modifications and terminations in 2023	(5,834)
Balance at June 30, 2023	$	(21,151)

Future Performance Obligations

As of June 30, 2024, unrecognized revenue attributable to unsatisfied and partially unsatisfied performance obligations under our long-term contracts was $72.5 million, of which $66.2 million related to trademark licensing, $5.5 million related to digital subscriptions and products, and $0.8 million related to direct-to-consumer products. Unrecognized revenue of the trademark licensing revenue stream is expected to be recognized over the next seven years, of which 97% is expected to be recognized in the first five years. Unrecognized revenue of the digital subscriptions and products revenue stream is expected to be recognized over the next five years, of which 51% is expected to be recognized in the first year. Unrecognized revenues under contracts disclosed above do not include contracts for which variable consideration is determined based on the customer’s subsequent sale or usage.

Disaggregation of Revenue

The following table disaggregates revenue by type (in thousands):


	Three Months Ended June 30, 2024										Six Months Ended June 30, 2024
	Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total		Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total
Trademark licensing	$	5,272	$	—	$	—	$	—	$	5,272	$	9,357	$	—	$	—	$	—	$	9,357
Digital subscriptions and products	—		—		3,479		—		3,479		—		—		7,283		—		7,283
TV and cable programming	—		—		1,630		—		1,630		—		—		3,320		—		3,320
Consumer products	—		14,504		—		—		14,504		—		33,244		—		—		33,244
Total revenues	$	5,272	$	14,504	$	5,109	$	—	$	24,885	$	9,357	$	33,244	$	10,603	$	—	$	53,204


	Three Months Ended June 30, 2023										Six Months Ended June 30, 2023
	Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total		Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total
Trademark licensing	$	10,288	$	—	$	—	$	—	$	10,288	$	19,982	$	—	$	—	$	—	$	19,982
Digital subscriptions and products	—		—		3,097		1		3,098		—		—		5,786		4		5,790
TV and cable programming	—		—		2,015		—		2,015		—		—		4,064		—		4,064
Consumer products	—		19,700		—		—		19,700		—		40,468		—		—		40,468
Total revenues	$	10,288	$	19,700	$	5,112	$	1	$	35,101	$	19,982	$	40,468	$	9,850	$	4	$	70,304

The following table disaggregates revenue by point in time versus over time (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Point in time	$	15,837	$	20,801	$	36,125	$	42,144
Over time	9,048		14,300		17,079		28,160
Total revenues	$	24,885	$	35,101	$	53,204	$	70,304

4. Inventories, Net

The following table sets forth inventories, net, which are stated at the lower of cost (specific cost and first-in, first-out) and net realizable value (in thousands):


	June 30, 2024		December 31, 2023
Editorial and other pre-publication costs	$	107	$	242
Merchandise finished goods	10,248		12,758
Total	$	10,355	$	13,000

At June 30, 2024 and December 31, 2023, reserves for slow-moving and obsolete inventory amounted to $4.6 million and $5.5 million, respectively.

5. Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):


	June 30, 2024		December 31, 2023
Contract assets, current portion	$	2,120	$	1,547
Prepaid inventory not yet received	2,031		703
Prepaid software	832		1,488
Prepaid insurance	305		858
Promissory note receivable	142		1,632
Other	1,674		1,574
Total	$	7,104	$	7,802

6. Property and Equipment, Net

Property and equipment, net consisted of the following (in thousands):


	June 30, 2024		December 31, 2023
Internally developed software	$	11,643	$	10,812
Leasehold improvements	9,987		10,682
Equipment	3,715		3,747
Furniture and fixtures	1,762		1,932
Construction in progress	699		692
Total property and equipment, gross	27,806		27,865
Less: accumulated depreciation	(16,863)		(14,351)
Total	$	10,943	$	13,514

The aggregate depreciation expense related to property and equipment included in loss from continuing operations was $2.2 million and $1.3 million for the three months ended June 30, 2024 and 2023, respectively, and $3.6 million and $2.5 million for the six months ended June 30, 2024 and 2023, respectively.

7. Other Current Liabilities and Accrued Expenses

Other current liabilities and accrued expenses consisted of the following (in thousands):


	June 30, 2024		December 31, 2023
Taxes	$	6,923	$	8,479
Accrued interest	3,069		3,040
Accrued salaries, wages and employee benefits	2,314		4,157
Accrued creator fees	1,951		2,113
Outstanding gift cards and store credits	1,707		1,618
Other	6,550		8,560
Total	$	22,514	$	27,967

8. Debt

The following table sets forth our debt (in thousands):


	June 30, 2024		December 31, 2023
Term loan, due 2027	$	209,621	$	209,772
Plus: capitalized payment-in-kind interest	5,551		1,848
Total debt	215,172		211,620
Less: unamortized debt issuance costs	(536)		(582)
Less: unamortized debt discount	(18,384)		(20,619)
Total debt, net of unamortized debt issuance costs and debt discount	196,252		190,419
Less: current portion of long-term debt	(304)		(304)
Total debt, net of current portion	$	195,948	$	190,115

On May 10, 2023 (the “Restatement Date”), we entered into an amendment and restatement (the “A&R Credit Agreement”) of our prior credit agreement (the “2021 Credit Agreement”) to reduce the interest rate applicable to our senior secured debt and the implied interest rate on our Series A Preferred Stock, exchange (and thereby eliminate) our outstanding Series A Preferred Stock, and obtain additional covenant relief and funding. For the terms of the 2021 Credit Agreement, as amended, refer to Note 10, Debt, within the notes to our consolidated financial statements set forth in our Annual Report on Form 10-K filed with the SEC on March 29, 2024.

In connection with the A&R Credit Agreement, Fortress Credit Corp. and its affiliates (together, “Fortress”) became our lender with respect to approximately 90% of the term loans under the A&R Credit Agreement (the “A&R Term Loans”). Fortress exchanged 50,000 shares of our Series A Preferred Stock (representing all of our issued and outstanding preferred stock) for approximately $53.6 million of the A&R Term Loans, and we obtained approximately $11.8 million of additional funding as part of the A&R Term Loans. As a result, our Series A Preferred Stock was eliminated, and the principal balance of the A&R Term Loans under the A&R Credit Agreement became approximately $210.0 million on the Restatement Date.

In connection with the A&R Credit Agreement, the term loan under the 2021 Credit Agreement was apportioned into approximately $20.6 million of Tranche A term loans (“Tranche A”) and approximately $189.4 million of Tranche B term loans (“Tranche B”, and together with Tranche A comprising the A&R Term Loans). The prior amortization payments applicable to the term loan under the 2021 Credit Agreement were eliminated. The A&R Credit Agreement only requires that the smaller Tranche A be subject to quarterly amortization payments of approximately $76,000 per quarter. The benchmark rate for the A&R Term Loans is the applicable term of the Secured Overnight Financing Rate (“SOFR”), as published by the U.S. Federal Reserve Bank of New York (rather than the London Inter-Bank Offered Rate (“LIBOR”), as under the 2021 Credit Agreement). As of the Restatement Date, Tranche A accrued interest at SOFR plus 6.25% and 0.10% SOFR adjustment, with a SOFR floor of 0.50%. As of the Restatement Date, Tranche B accrued interest at SOFR plus 4.25% and 0.10% SOFR adjustment, with a SOFR floor of 0.50%.

We obtained additional leverage covenant relief through the first quarter of 2025, with testing of a total net leverage ratio covenant commencing following the quarter ending March 31, 2025, which covenant will be initially set at 7.25:1.00, reducing in 0.25 increments per quarter until the ratio reaches 5.25:1.00 for the quarter ending March 31, 2027.

In July 2023, DBD Credit Funding LLC, an affiliate of Fortress, became the administrative agent and collateral agent under the A&R Credit Agreement.

In connection with the TLA Sale, on November 2, 2023, we entered into Amendment No. 1 to the A&R Credit Agreement (the “A&R First Amendment”), to permit, among other things: (a) the TLA Sale and the sale of certain other assets (and the proceeds of such sales will not be required to prepay the A&R Term Loans); and (b) the Company to elect, through August 31, 2025, to pay in cash accrued interest equal to the applicable SOFR plus 1.00%, with the remainder of any applicable accrued interest not paid in cash capitalized into the A&R Term Loans. The other terms of the A&R Credit Agreement remained substantially unchanged from those prior to the A&R First Amendment.

On March 27, 2024, we entered into Amendment No. 2 to the A&R Credit Agreement (the “A&R Second Amendment”), which provided for, among other things:

(a) the amendment of the Total Net Leverage Ratio covenant to (i) suspend testing of such covenant until the quarter ending June 30, 2026, (ii) adjust the Total Net Leverage Ratio financial covenant levels once the covenant testing is resumed, and (iii) add a mechanism for the Total Net Leverage Ratio to be eliminated permanently upon the satisfaction of certain prepayment-related conditions (the date upon which such prepayment-related conditions are satisfied, the “Financial Covenant Sunset Date”);

(b) the addition of a covenant to maintain a $7.5 million minimum balance of unrestricted cash and cash equivalents (on a consolidated basis), subject to periodic testing and certification, as well as the ability to cure a below-minimum balance, and which covenant will be in effect (i) from March 27, 2024 until March 31, 2026 and (ii) from and after the Financial Covenant Sunset Date; and

(c) that assignments of commitments or loans under the A&R Credit Agreement from existing lenders to certain eligible assignees under the A&R Credit Agreement (i.e. a commercial bank, insurance company, investment or mutual fund or other entity that is an “accredited investor” (as defined in Regulation D under the Securities Act of 1933) and which extends credit or buys loans in the ordinary course of business) shall not require consent from us while the minimum cash balance financial covenant is in effect.

The other terms of the A&R Credit Agreement prior to the A&R Second Amendment remained substantially unchanged.

The stated interest rate of Tranche A and Tranche B term loans as of June 30, 2024 was 11.68% and 9.68%, respectively. The stated interest rate of Tranche A and Tranche B term loans as of December 31, 2023 was 11.41% and 9.41%, respectively. The effective interest rate of Tranche A and Tranche B A&R Term Loans as of June 30, 2024 was 12.30% and 13.55%, respectively. The effective interest rate of Tranche A and Tranche B A&R Term Loans as of December 31, 2023 was 12.03% and 13.27%, respectively. The difference between the stated interest rate and effective interest rate for Tranche B as of June 30, 2024 and December 31, 2023 is driven primarily by the amortization of $21.3 million of debt discount which is included in the calculation of the effective interest rate.

We were in compliance with applicable financial covenants under the terms of the A&R Credit Agreement and its amendments as of June 30, 2024 and December 31, 2023.

The following table sets forth maturities of the principal amount of our A&R Term Loans as of June 30, 2024 (in thousands):


Remainder of 2024	$	152
2025	304
2026	304
2027	214,412
Total	$	215,172

9. Stockholders’ Equity

Common Stock

Common stock reserved for future issuance consisted of the following:


	June 30, 2024	December 31, 2023
Shares available for grant under equity incentive plans	3,687,252	739,178
Options issued and outstanding under equity incentive plans	1,997,466	2,291,328
Unvested restricted stock units	1,604,235	3,214,910
Vested equity awards not yet settled	1,196,828	14,994
Unvested performance-based restricted stock units	389,827	707,655
Maximum number of shares issuable to GlowUp sellers pursuant to acquisition indemnity holdback	249,116	249,116
Total common stock reserved for future issuance	9,124,724	7,217,181

10. Stock-Based Compensation

As of June 30, 2024, 10,737,065 shares of common stock had been authorized for issuance under our 2021 Equity and Incentive Compensation Plan (the “2021 Plan”) and 6,287,687 shares of common stock were originally reserved for issuance under our 2018 Equity Incentive Plan.

Stock Option Activity

A summary of the stock option activity under our equity incentive plans is as follows:


	Number of Options	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (in thousands)
Balance – December 31, 2023	2,291,328	$	2.49	6.4	$	311
Granted	—	—		—	—
Exercised	—	—		—	—
Forfeited, expired and cancelled	(293,862)	5.05		—	—
Balance – June 30, 2024	1,997,466	$	2.12	6.8	$	107
Exercisable – June 30, 2024	1,540,180	$	2.55	6.1	$	54
Vested and expected to vest as of June 30, 2024	1,997,466	$	2.12	6.8	$	107

There were no options granted during the three or six months ended June 30, 2024 or 2023. There were no options forfeited, expired or cancelled during the three months ended June 30, 2024.

Restricted Stock Units

A summary of restricted stock unit activity under our equity incentive plans is as follows:


	Number of Awards	Weighted- Average Grant Date Fair Value per Share
Unvested and outstanding balance at December 31, 2023	3,214,910	$	2.91
Granted	—	—
Vested	(1,584,097)	3.08
Forfeited	(26,578)	3.11
Unvested and outstanding balance at June 30, 2024	1,604,235	$	2.74

The total fair value of restricted stock units that vested during the three months ended June 30, 2024 and 2023 was approximately $1.1 million and $1.2 million, respectively. The total fair value of restricted stock units that vested during the six months ended June 30, 2024 and 2023 was approximately $1.4 million and $1.6 million, respectively. We had 879,000 outstanding and fully vested restricted stock units that remained unsettled at June 30, 2024, all of which are expected to be settled in 2024. As such, they are excluded from outstanding shares of common stock but are included in weighted-average shares outstanding for the calculation of net loss per share for the three and six months ended June 30, 2024.

A summary of performance-based restricted stock unit (“PSU”) activity under our 2021 Plan is as follows:


	Number of awards	Weighted- average grant date fair value per share
Unvested and outstanding balance at December 31, 2023	707,655	$	10.8
Granted	—	—
Vested (1)	(317,828)	16.93
Forfeited	—	—
Unvested and outstanding balance at June 30, 2024	389,827	$	5.80

(1) Relates to PSUs that were modified in the fourth quarter of 2023 to change the unvested shares underlying the original awards to time-based vesting.

The total fair value of PSUs that vested during the three and six months ended June 30, 2024 was approximately $0.2 million. There were no PSUs that vested during the three and six months ended June 30, 2023. We had 317,828 outstanding and fully vested PSUs that remained unsettled at June 30, 2024, all of which are expected to be settled in 2024. As such, they are excluded from outstanding shares of common stock but are included in weighted-average shares outstanding for the calculation of net loss per share for the three and six months ended June 30, 2024.

Stock-Based Compensation Expense

Stock-based compensation expense under our equity incentive plans was as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Cost of sales (1)	$	—	$	(826)	$	633	$	(453)
Selling and administrative expenses (2)	2,005		3,977		3,206		8,823
Total	$	2,005	$	3,151	$	3,839	$	8,370

(1) Cost of sales for the three and six months ended June 30, 2023 includes a net reversal of $1.1 million of stock-based compensation expense associated with equity awards granted to an independent contractor for services pursuant to the terms of a license, services and collaboration agreement. The contract with such independent contractor expired in the fourth quarter of 2023, and there was no related stock-based compensation expense recorded for the three and six months ended June 30, 2024.

(2) Selling and administrative expenses for the three and six months ended June 30, 2023 includes $1.3 million and $2.3 million of accelerated amortization of stock-based compensation expense for certain equity awards during the three and six months ended June 30, 2023, respectively.

The expense presented in the table above is net of capitalized stock-based compensation relating to software development costs of $0.5 million and $1.2 million during the three and six months ended June 30, 2023, respectively. There was no capitalized stock-based compensation relating to software development costs during the three and six months ended June 30, 2024, as stock-based compensation relating to software development costs eligible to be capitalized in the first and second quarters of 2024 was immaterial.

At June 30, 2024, unrecognized compensation cost related to unvested stock options was $0.5 million and is expected to be recognized over the remaining weighted-average service period of 1.0 year. At June 30, 2024, total unrecognized compensation cost related to unvested PSUs and restricted stock units was $4.2 million and is expected to be recognized over the remaining weighted-average service period of 1.29 years.

11. Commitments and Contingencies

Leases

As of June 30, 2024 and December 31, 2023, the weighted-average remaining term of our operating leases from continuing operations was 4.7 years and 5.2 years, respectively, and the weighted-average discount rate used to estimate the net present value of the operating lease liabilities was 7.1% and 7.0%, respectively. Cash payments for amounts included in the measurement of operating lease liabilities attributable to continuing operations were $2.1 million for the three months ended June 30, 2024 and 2023, and $4.5 million and $4.3 million for the six months ended June 30, 2024 and 2023, respectively. There were no right-of-use assets obtained in exchange for new operating lease liabilities during the three months ended June 30, 2024. Right-of-use assets obtained in exchange for new operating lease liabilities attributable to continuing operations were $1.2 million for the three months ended June 30, 2023. Right-of-use assets obtained in exchange for new operating lease liabilities attributable to continuing operations were $0.6 million and $2.4 million for the six months ended June 30, 2024 and 2023, respectively.

In conjunction with the Yandy Sale in the second quarter of 2023, we entered into a sublease agreement with the buyer of Yandy in relation to its warehouse and office space for the remaining term of the lease, which expires in 2031.

Net lease cost recognized in our unaudited condensed consolidated statements of operations for the three and six months ended June 30, 2024 and 2023 is summarized in the table below (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Operating lease cost	$	2,105	$	1,928	$	4,190	$	3,819
Variable lease cost	266		343		640		745
Short-term lease cost	445		581		848		1,291
Sublease income	(232)		(196)		(454)		(265)
Total	$	2,584	$	2,656	$	5,224	$	5,590

Maturities of our operating lease liabilities as of June 30, 2024 were as follows (in thousands):


Remainder of 2024	$	4,129
2025	7,900
2026	7,314
2027	4,832
2028	2,458
Thereafter	5,773
Total undiscounted lease payments	32,406
Less: imputed interest	(5,340)
Total operating lease liabilities	$	27,066

Operating lease liabilities, current portion	$	6,438
Operating lease liabilities, noncurrent portion	$	20,628

Legal Contingencies

From time to time, we may have certain contingent liabilities that arise in the ordinary course of our business activities. We accrue a liability for such matters when it is probable that future expenditures will be made and that such expenditures can be reasonably estimated. Significant judgment is required to determine both probability and the estimated amount.

TNR Case

On June 21, 2024, we settled the previously disclosed litigation against our subsidiary Playboy Enterprises International, Inc. (together with its subsidiaries, “PEII”), which was brought by Thai Nippon Rubber Industry Public Limited Company, a manufacturer of condoms and lubricants and a publicly traded Thailand company (“TNR”). No party to the lawsuit admitted any liability or wrongdoing in connection with the settlement agreement. The TNR lawsuit was fully dismissed with prejudice by the court on August 1, 2024.

AVS Case

In March 2020, PEII terminated its license agreement with a licensee, AVS Products, LLC (“AVS”), for AVS’s failure to make required payments to PEII under the agreement, following notice of breach and an opportunity to cure. On February 6, 2021, PEII received a letter from counsel to AVS alleging that the termination of the contract was improper, and that PEII failed to meet its contractual obligations, preventing AVS from fulfilling its obligations under the license agreement.

On February 25, 2021, PEII brought suit against AVS in Los Angeles Superior Court to prevent further unauthorized sales of Playboy-branded products and for disgorgement of unlawfully obtained funds. On March 1, 2021, PEII also brought a claim in arbitration against AVS for outstanding and unpaid license fees. PEII and AVS subsequently agreed that the claims PEII brought in arbitration would be alleged in the Los Angeles Superior Court case instead, and on April 23, 2021, the parties entered into and filed a stipulation to that effect with the court. On May 18, 2021, AVS filed a demurrer, asking for the court to remove an individual defendant and dismiss PEII’s request for a permanent injunction. On June 10, 2021, the court denied AVS’s demurrer. AVS filed an opposition to PEII’s motion for a preliminary injunction to enjoin AVS from continuing to sell or market Playboy-branded products on July 2, 2021, which the court denied on July 28, 2021.

On August 10, 2021, AVS filed a cross-complaint for breach of contract, breach of the implied covenant of good faith and fair dealing, quantum meruit and declaratory relief. As in its February 2021 letter, AVS alleges its license was wrongfully terminated and that PEII failed to approve AVS’ marketing efforts in a manner that was either timely or that was commensurate with industry practice. AVS is seeking to be excused from having to perform its obligations as a licensee, payment of the value for services rendered by AVS to PEII outside of the license, and damages to be proven at trial. The court heard PEII’s motion for summary judgment on June 6, 2023, and dismissed six out of 10 of AVS’ causes of action. AVS’ contract-related claims remain to be determined at trial, which is set for September 30, 2024. The parties are currently engaged in discovery. We believe AVS’ remaining claims and allegations are without merit, and we will defend this matter vigorously.

New Handong Arbitration

On February 8, 2024, PEII and certain of its subsidiaries initiated arbitration in the Hong Kong International Arbitration Centre (the “Arbitration”) against PEII’s terminated China licensee, New Handong Investment (Guangdong) Co., Ltd. (“New Handong”). In October 2023, PEII’s subsidiary terminated its license agreement with New Handong due to ongoing, uncured material breaches by New Handong. PEII and its subsidiaries are seeking damages, including the payment of outstanding guaranteed minimum royalties, the payment of all guaranteed minimum royalties for the remainder of the term of the agreement, and other contractual damages for a variety of breaches. Such breaches include unauthorized sales of products, underpayment of earned royalties, failure to use approved trademarks and affix official holograms to all products, and the use of unapproved sublicensees. PEII and its subsidiaries are also seeking a declaration that the termination of the agreement was lawful and valid and the issuance of a legal order to require New Handong to refrain from any further manufacture, sale, distribution or other use of any Playboy intellectual property or products. While PEII believes it has strong claims against New Handong, and that the facts of the matter support those claims, even in the event PEII were to obtain all the relief it seeks from the Arbitration, PEII can provide no assurance or guarantee that it will be able to enforce the results of the Arbitration against New Handong or recover any or all monetary awards from New Handong.

Former Model Case

On July 5, 2024, a former Playboy model filed a complaint against the Company, certain of the Company’s affiliates and A&E Television Networks LLC (“A&E”, and collectively, with the Company and its affiliates, the “Defendants”) in California Superior Court for claims arising from A&E’s “Secrets of Playboy” show (the “A&E Show”) which showed certain Playboy videos that depicted the former model. Neither the Company nor its affiliates participated in any way in the creation, production, distribution or airing of the A&E Show, nor did the Company or its affiliates license or otherwise authorize use of the videos in the A&E Show. The complaint alleges, among other things, invasion of privacy, appropriation, distribution of private explicit video, negligence and unfair competition by the Defendants to the detriment of the former model. The lawsuit seeks at least $2 million in damages from the Defendants. The Company believes the plaintiff’s claims and allegations with respect to the Company and its affiliates are without merit, and it will defend itself vigorously in this matter.

12. Severance Costs

We incurred severance costs during 2023 due to the reduction of headcount, as we shift our business to a more capital-light model. Severance costs are recorded in selling and administrative expenses in the condensed consolidated statements of operations, with an immaterial amount recorded in cost of sales, and in accrued salaries, wages, and employee benefits in our condensed consolidated balance sheets. Severance costs were immaterial during the three and six months ended June 30, 2024.

Severance costs in our condensed consolidated statements of operations were as follows (in thousands):


	Three Months Ended June 30, 2023		Six Months Ended June 30, 2023
Direct-to-Consumer	$	756	$	1,127
Licensing	36		53
Digital Subscriptions and Content	—		39
Corporate	10		1,221
Total	$	802	$	2,440

The following is a reconciliation of the beginning and ending severance costs balances recorded in accrued salaries, wages, and employee benefits in our condensed consolidated balance sheets (in thousands):


	Employee Separation Costs
Balance at December 31, 2023	$	1,184
Costs incurred and charged to expense	169
Costs paid or otherwise settled	(1,157)
Balance at June 30, 2024	$	196

13. Income Taxes

The effective tax rate for the three months ended June 30, 2024 and 2023 was (3.8)% and 6.3%, respectively. The effective tax rate for the six months ended June 30, 2024 and 2023 was (5.3)% and 5.9%, respectively. The effective tax rate for the three and six months ended June 30, 2024 differed from the U.S. statutory federal income tax rate of 21% primarily due to impairment charges on artwork held for sale, foreign withholding taxes and the release of valuation allowance due to a reduction in net deferred tax liabilities of indefinite lived intangibles. The effective tax rate for the three and six months ended June 30, 2023 differed from the U.S. statutory federal income tax rate of 21% primarily due to foreign withholding taxes, the limitations of Internal Revenue Code Section Section 162(m), stock compensation shortfall deductions and the release of valuation allowance due to a reduction in net deferred tax liabilities of indefinite lived intangibles.

During the second quarter of 2024, the Company decided to revoke its permanent reinvestment assertion on certain foreign jurisdictions and repatriated total earnings from foreign subsidiaries of $2.7 million to the United States. Due to the Company’s overall losses incurred and the dividends received deduction in the United States, such repatriation did not have any material impact on the Company’s tax provision for the quarter ended June 30, 2024.

14. Net Loss Per Share

The following outstanding potentially dilutive shares have been excluded from the calculation of diluted net loss per share due to their anti-dilutive effect:


	Three Months Ended June 30,		Six Months Ended June 30,
	2024	2023	2024	2023
Options issued and outstanding under equity incentive plans	1,997,466	2,496,494	1,997,466	2,496,494
Unvested restricted stock units	1,604,235	1,066,281	1,604,235	1,066,281
Unvested performance-based restricted stock units	389,827	1,089,045	389,827	1,089,045
Total	3,991,528	4,651,820	3,991,528	4,651,820

15. Segments

We have three reportable segments: Direct-to-Consumer, Licensing, and Digital Subscriptions and Content. The Direct-to-Consumer segment derives revenue from sales of consumer products sold by us online direct to customers or at our Honey Birdette brick-and-mortar stores, of which there were 59 stores in three countries as of June 30, 2024. The Licensing segment derives revenue from trademark licenses for third-party consumer products and online and location-based entertainment businesses.

The Digital Subscriptions and Content segment derives revenue from the subscription of Playboy programming that is distributed through various channels, including websites and domestic and international television, and sales of creator content offerings and memberships to consumers through the Playboy Club on playboy.com.

Our Chief Executive Officer is our Chief Operating Decision Maker (“CODM”). Segment information is presented in the same manner that our CODM reviews the operating results in assessing performance and allocating resources. Total asset information is not included in the tables below as it is not provided to and reviewed by our CODM. The “All Other” line items in the tables below are miscellaneous in nature and do not relate to the previously identified reportable segments disclosed herein. These segments do not meet the quantitative threshold for determining reportable segments. The “Corporate” line item in the tables below includes certain operating expenses that are not allocated to the reporting segments presented to our CODM. These expenses include legal, human resources, accounting/finance, information technology and facilities. The accounting policies of the reportable segments are the same as those described in Note 1, Basis of Presentation and Summary of Significant Accounting Policies.

The following table sets forth financial information by reportable segment (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net revenues:
Direct-to-Consumer	$	14,504	$	19,700	$	33,244	$	40,468
Licensing	5,272		10,288		9,357		19,982
Digital Subscriptions and Content	5,109		5,112		10,603		9,850
All Other	—		1		—		4
Total	$	24,885	$	35,101	$	53,204	$	70,304
Operating (loss) income:
Direct-to-Consumer	$	(2,365)	$	(75,002)	$	(1,483)	$	(90,058)
Licensing	4,323		(65,131)		6,340		(61,564)
Digital Subscriptions and Content	(2,215)		1,002		(2,314)		393
Corporate	(8,948)		(13,918)		(20,675)		(29,794)
All Other	2		(7)		12		(12)
Total	$	(9,203)	$	(153,056)	$	(18,120)	$	(181,035)

Geographic Information

Revenue by geography is based on where the customer is located. The following table sets forth revenue by geographic area (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net revenues:
United States	$	11,470	$	14,975	$	25,630	$	30,634
Australia	6,689		7,608		14,823		15,136
China	3,024		7,475		4,470		14,423
UK	2,044		2,943		4,744		5,445
Other	1,658		2,100		3,537		4,666
Total	$	24,885	$	35,101	$	53,204	$	70,304

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

You should read the following discussion of our financial condition and results of operations in conjunction with our unaudited interim condensed consolidated financial statements as of and for the three and six months ended June 30, 2024 and 2023 and the related notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q, our audited consolidated financial statements as of and for the years ended December 31, 2023 and 2022 and the related notes thereto included in our Annual Report on Form 10-K filed with the SEC on March 29, 2024. This discussion contains forward-looking statements that involve risks and uncertainties and that are not historical facts, including statements about our beliefs and expectations. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed below and particularly under the headings “Risk Factors”, “Business” and “Cautionary Note Regarding Forward-Looking Statements” contained in our Annual Report on Form 10-K filed with the SEC on March 29, 2024. As used herein, “we”, “us”, “our”, the “Company”, and “PLBY” refer to PLBY Group, Inc. and its subsidiaries.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains statements that are forward-looking and as such are not historical facts. These statements are based on the expectations and beliefs of the management of the Company in light of historical results and trends, current conditions and potential future developments, and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those anticipated in these forward-looking statements. These forward-looking statements include all statements other than historical fact, including, without limitation, statements regarding the financial position, capital structure, dividends, indebtedness, business strategy and plans and objectives of management for future operations of the Company. These statements constitute projections, forecasts and forward-looking statements, and are not guarantees of performance. Such statements can be identified by the fact that they do not relate strictly to historical or current facts. When used in this Quarterly Report on Form 10-Q, words such as “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “intend”, “may”, “might”, “plan”, “possible”, “potential”, “predict”, “project”, “should”, “strive”, “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. When we discuss our strategies or plans, we are making projections, forecasts or forward-looking statements. Such statements are based on the beliefs of, as well as assumptions made by and information currently available to, our management.

The forward-looking statements contained in this Quarterly Report on Form 10-Q are based on current expectations and beliefs concerning future developments and their potential effects on our business. There can be no assurance that future developments affecting us will be those that we anticipated. These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from those discussed in the forward-looking statements. Factors that may cause such differences include, but are not limited to: (1) the inability to maintain the listing of the Company’s shares of common stock on Nasdaq; (2) the risk that the Company’s completed or proposed transactions disrupt the Company’s current plans and/or operations, including the risk that the Company does not complete any such proposed transactions or achieve the expected benefits from any transactions; (3) the ability to recognize the anticipated benefits of corporate transactions, commercial collaborations, commercialization of digital assets, cost reduction initiatives and proposed transactions, which may be affected by, among other things, competition, the ability of the Company to grow and manage growth profitably, and the Company’s ability to retain its key employees; (4) costs related to being a public company, corporate transactions, commercial collaborations and proposed transactions; (5) changes in applicable laws or regulations; (6) the possibility that the Company may be adversely affected by global hostilities, supply chain delays, inflation, interest rates, foreign currency exchange rates or other economic, business, and/or competitive factors; (7) risks relating to the uncertainty of the projected financial information of the Company, including changes in the Company’s estimates of cash flows and the fair value of certain of its intangible assets, including goodwill; (8) risks related to the organic and inorganic growth of the Company’s businesses, and the timing of expected business milestones; (9) changing demand or shopping patterns for the Company’s products and services; (10) failure of licensees, suppliers or other third-parties to fulfill their obligations to the Company; (11) the Company’s ability to comply with the terms of its indebtedness and other obligations; (12) changes in financing markets or the inability of the Company to obtain financing on attractive terms; and (13) other risks in “Part I—Item 1A. Risk Factors” in our most recent Annual Report on Form 10-K. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We caution that the foregoing list of factors is not exclusive, and readers should not place undue reliance upon any forward-looking statements.

Forward-looking statements included in this Quarterly Report on Form 10-Q speak only as of the date of this Quarterly Report on Form 10-Q or any earlier date specified for such statements. We do not undertake any obligation to update or revise any forward-looking statements to reflect any change in its expectations or any change in events, conditions, or circumstances on which any such statement is based, except as may be required under applicable securities laws. All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf are qualified in their entirety by this Cautionary Note Regarding Forward-Looking Statements.

Business Overview

We are a global consumer lifestyle company marketing our brands through a wide range of direct-to-consumer products, licensing initiatives, digital subscriptions and content, and online and location-based entertainment businesses. We reach consumers worldwide with products across four key market categories: Style and Apparel, including a variety of apparel and accessories products; Digital Entertainment and Lifestyle, including our creator platform, web and television-based entertainment, and our spirits and hospitality products; Sexual Wellness, including lingerie and intimacy products; and Beauty and Grooming, including fragrance, skincare, grooming and cosmetics.

We have three reportable segments: Direct-to-Consumer, Licensing, and Digital Subscriptions and Content. The Direct-to-Consumer segment derives its revenue from sales of consumer products sold directly to consumers through our own online channels and our retail stores. The Licensing segment derives revenue from trademark licenses for third-party consumer products, location-based entertainment businesses and online gaming. The Digital Subscriptions and Content segment derives revenue from the subscription of Playboy programming, which is distributed through various channels, including websites and domestic and international television, and sales of creator content offerings and memberships to consumers at the Playboy Club on playboy.com.

Key Factors and Trends Affecting Our Business

We believe that our performance and future success depends on several factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and referenced in the section of this Quarterly Report on Form 10-Q titled “Risk Factors”.

Pursuing a More Capital-Light Business Model

We are pursuing a commercial strategy that relies on a more capital-light business model focused on revenue streams with higher margin, lower working capital requirements and higher growth potential. We are doing this by leveraging our flagship Playboy brand to scale our creator platform with influencers who embody the Playboy brand’s aspirational lifestyle and attract best-in-class strategic partners. We are focused on our two key growth pillars: first, investing in the Playboy digital platform as we return to our roots as a place to see and be seen for creators and up and coming cultural influencers; and second, strategically expanding our licensing business in key categories and territories. We will continue to use our licensing business as a marketing tool and brand builder, in particular through our high-end designer collaborations and our large-scale strategic partnerships.

China Licensing Revenues

Our licensing revenues from China (including Hong Kong) as a percentage of our total revenues from continuing operations were 12% and 21% for the three months ended June 30, 2024 and 2023, respectively, and 8% and 21% for the six months ended June 30, 2024 and 2023, respectively. At the end of the first quarter of 2023, we entered into a joint venture (the “China JV”) with Charactopia Licensing Limited, the brand management unit of Fung Group. The China JV owns and operates the Playboy consumer products business in mainland China, Hong Kong and Macau. In 2023, due to challenging economic conditions in China, collections from certain of our Chinese licensees slowed significantly, and we had to renegotiate terms of, or terminate, certain licenses. Future contract modifications and collectability issues could further impact the revenue recognized against our ongoing contract assets. Nonetheless, we continue to work with our China JV partner to re-invigorate our China-market Playboy direct-to-consumer and licensing businesses, by building on Playboy’s current roster of licensees and online storefronts and developing additional revenue through expanding into new product categories with new licensees.

Seasonality of Our Consumer Product Sales

While we receive revenue throughout the year, our businesses have experienced, and may continue to experience, seasonality. For example, our licensing business historically experienced higher receipts in its first and third fiscal quarters due to the licensing fee structure in our licensing agreements, which typically require advance payment of such fees during those quarters, but such payments can be subject to variations, extensions or delays. Our direct-to-consumer businesses have historically experienced higher sales in the fourth quarter due to the U.S. holiday season, but changing market conditions and demand could affect such sales. Historical seasonality of revenues may be subject to change as increasing pressure from competition and changes in consumer trends and economic conditions impact our licensees and consumers. Transitioning to a capital-light business model with a more streamlined consumer products business may further impact the seasonality of our business in the future.

How We Assess the Performance of Our Business

In assessing the performance of our business, we consider a variety of performance and financial measures. The key indicators of the financial condition and operating performance of the business are revenues, salaries and benefits, and selling and administrative expenses. To help assess performance with these key indicators, we use Adjusted EBITDA as a non-GAAP financial measure. We believe this non-GAAP measure provides useful information to investors and expanded insight to measure revenue and cost performance as a supplement to the GAAP consolidated financial statements. See the “EBITDA and Adjusted EBITDA” section below for reconciliations of Adjusted EBITDA to net loss, the closest GAAP measure.

Components of Results of Operations

Revenues

We generate revenue from sales of consumer products sold through our retail stores or online direct-to-customer, trademark licenses for third-party consumer products and online and location-based entertainment businesses, and sales of creator content offerings and memberships to consumers on our creator-led platform on playboy.com, in addition to subscriptions to our programming, which is distributed through various channels, including websites and domestic and international television.

Consumer Products

Revenue from sales of online apparel and accessories, including sales through third-party sellers, is recognized upon delivery of the goods to the customer. Revenue from sales of apparel at our retail stores is recognized at the time of transaction. Revenue is recognized net of incentives and estimated returns. We periodically offer promotional incentives to customers, which include basket promotional code discounts and other credits, which are recorded as a reduction of revenue.

Trademark Licensing

We license trademarks under multi-year arrangements to third-party consumer products and online and location-based entertainment businesses. Typically, the initial contract term ranges between one to ten years. Renewals are separately negotiated through amendments. Under these arrangements, we generally receive an annual non-refundable minimum guarantee that is recoupable against a sales-based royalty generated during the license year. Earned royalties received in excess of the minimum guarantee (“Excess Royalties”) are typically payable quarterly. We recognize revenue for the total minimum guarantee specified in the agreement on a straight-line basis over the term of the agreement and recognize Excess Royalties only when the annual minimum guarantee is exceeded. Generally, Excess Royalties are recognized when they are earned. In the event that the collection of any royalty becomes materially uncertain or unlikely, we recognize revenue from our licensees on a cash basis.

Digital Subscriptions

Digital subscription revenue is derived from subscription sales of playboyplus.com and playboy.tv, which are online content platforms. We receive fixed consideration shortly before the start of the subscription periods from these contracts, which are primarily sold in monthly, annual, or lifetime subscriptions. Revenues from lifetime subscriptions are recognized ratably over a five-year period, representing the estimated period during which the customer accesses the platforms. Revenues from digital subscriptions are recognized ratably over the subscription period.

Revenues generated from the sales of creator content offerings and memberships to consumers via our creator platform on playboy.com are recognized at the point in time when the sale is processed. Revenues generated from subscriptions to our creator platform are recognized ratably over the subscription period.

TV and Cable Programming

We license programming content to certain cable television operators and direct-to-home satellite television operators who pay royalties based on monthly subscriber counts and pay-per-view and video-on-demand buys for the right to distribute our programming under the terms of affiliation agreements. Royalties are generally collected monthly and recognized as revenue as earned.

Cost of Sales

Cost of sales primarily consist of merchandise costs, warehousing and fulfillment costs, agency fees, website expenses, digital platform expenses, marketplace traffic acquisition costs, credit card processing fees, personnel and affiliate costs, including stock-based compensation, costs associated with branding events, customer shipping and handling expenses, fulfillment activity costs and freight-in expenses.

Selling and Administrative Expenses

Selling and administrative expenses primarily consist of corporate office and retail store occupancy costs, personnel costs, including stock-based compensation, and contractor fees for accounting/finance, legal, human resources, information technology and other administrative functions, general marketing and promotional activities and insurance.

Impairments

Impairments consist of the impairments of our art held for sale, certain licensing contracts, right-of-use assets, Playboy-branded trademarks, trade names and goodwill.

Other Operating Income, Net

Other operating income, net consists primarily of gains recognized from the sale of crypto assets and other miscellaneous items.

Nonoperating (Expense)

Interest Expense

Interest expense consists of interest on our long-term debt and the amortization of deferred financing costs and debt discount.

Gain on Extinguishment of Debt

In the first quarter of 2023, we recorded a loss on partial extinguishment of debt in the amount of $1.8 million related to the write-off of unamortized debt discount and deferred financing costs as a result of $45 million in prepayments of our senior debt pursuant to the third and fourth amendments of our 2021 Credit Agreement in February 2023. In the second quarter of 2023, we recorded a gain on partial extinguishment of debt in amount of $8.0 million upon the amendment and restatement of the 2021 Credit Agreement (as such term is defined in Note 8, Debt within the notes to the financial statements included in this Quarterly Report on Form 10-Q; see Note 8, Debt and “Liquidity and Capital Resources” for additional details).

Fair Value Remeasurement Gain

Fair value remeasurement gain consists of changes to the fair value of mandatorily redeemable preferred stock liability related to its remeasurement.

Other Income (Expense), Net

Other income (expense), net consists primarily of other miscellaneous nonoperating items, such as bank charges and foreign exchange gains or losses as well as non-recurring transaction fees.

(Expense) Benefit from Income Taxes

(Expense) benefit from income taxes consists of an estimate for U.S. federal, state, and foreign income taxes based on enacted rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities, and changes in the tax law. Due to cumulative losses, we maintain a valuation allowance against our U.S. federal and state deferred tax assets, as well as our Australia, U.K. and China deferred tax assets.

Results of Operations

Comparison of the Three Months Ended June 30, 2024 and 2023

The following table summarizes key components of our results of operations for the periods indicated (in thousands, except percentages):


	Three Months Ended June 30,
	2024		2023		$ Change		% Change
Net revenues	$	24,885	$	35,101	$	(10,216)	(29)	%
Costs and expenses:
Cost of sales	(8,018)		(9,659)		1,641		(17)	%
Selling and administrative expenses	(25,489)		(32,517)		7,028		(22)	%
Impairments	(599)		(146,240)		145,641		(100)	%
Other operating income, net	18		259		(241)		(93)	%
Total operating expense	(34,088)		(188,157)		154,069		(82)	%
Operating loss	(9,203)		(153,056)		143,853		(94)	%
Nonoperating (expense) income:
Interest expense	(6,588)		(5,757)		(831)		14	%
Gain on extinguishment of debt	—		7,980		(7,980)		(100)	%
Fair value remeasurement gain	—		9,523		(9,523)		(100)	%
Other (expense) income, net	(245)		175		(420)		(240)	%
Total nonoperating (expense) income	(6,833)		11,921		(18,754)		(157)	%
Loss from continuing operations before income taxes	(16,036)		(141,135)		125,099		(89)	%
(Expense) benefit from income taxes	(616)		8,868		(9,484)		(107)	%
Net loss from continuing operations	(16,652)		(132,267)		115,615		(87)	%
Income from discontinued operations, net of tax	—		452		(452)		(100)	%
Net loss	(16,652)		(131,815)		115,163		(87)	%
Net loss attributable to PLBY Group, Inc.	$	(16,652)	$	(131,815)	$	115,163	(87)	%

The following table sets forth our condensed consolidated statements of operations data expressed as a percentage of total revenue for the periods indicated:


	Three Months Ended June 30,
	2024	2023
Net revenues	100%	100%
Costs and expenses:
Cost of sales	(32)	(28)
Selling and administrative expenses	(102)	(93)
Impairments	(2)	(417)
Other operating income, net	—	1
Total operating expense	(136)	(537)
Operating loss	(36)	(437)
Nonoperating (expense) income:
Interest expense	(26)	(16)
Gain on extinguishment of debt	—	23
Fair value remeasurement gain	—	27
Other (expense) income, net	(1)	—
Total nonoperating (expense) income	(27)	34
Loss from continuing operations before income taxes	(63)	(403)
(Expense) benefit from income taxes	(2)	25
Net loss from continuing operations	(65)	(378)
Income from discontinued operations, net of tax	—	1
Net loss	(65)	(377)
Net loss attributable to PLBY Group, Inc.	(65)%	(377)%

Net Revenues

The decrease in net revenues for the three months ended June 30, 2024, as compared to the prior year comparative period, was primarily due to lower licensing revenue of $5.0 million, largely driven by the termination of certain Chinese licensing agreements in 2023, lower direct-to-consumer revenue of $5.2 million, as a result of $1.4 million less revenue from Playboy’s e-commerce site, as it changed from our ownership and operation to a licensed business model in the third quarter of 2023, and a $3.8 million decrease in revenue from Honey Birdette, partly offset by $0.3 million of higher revenue from our creator platform.

Cost of Sales

The decrease in cost of sales for the three months ended June 30, 2024, as compared to the prior year comparative period, was primarily due to a decrease in inventory reserve charges of $0.7 million, a $2.6 million decrease in direct-to-consumer product costs, as a result of a $1.4 million decrease in product costs from Playboy’s e-commerce site, as it changed from our ownership and operation to a licensed business model in the third quarter of 2023, and a $1.2 million decrease in product costs from Honey Birdette, due to lower revenues, lower licensing product costs of $0.9 million primarily due to the termination of Playboy’s e-commerce licensing agreement in the second quarter of 2024, and lower digital subscriptions product costs of $0.4 million, which was partly offset by a $3.5 million increase in licensing commissions primarily due to a nonrecurring reduction in commission accrual in the prior year related to the termination of certain Chinese licensing agreements.

Selling and Administrative Expenses

The decrease in selling and administrative expenses for the three months ended June 30, 2024, as compared to the prior year comparative period, was primarily due to a $2.0 million decrease in stock-based compensation expense, lower legal fees of $2.0 million, a $1.4 million decrease in China JV expenses due to cost cuts, lower payroll expenses of $0.6 million due to headcount reductions, lower severance expense of $0.7 million, a decrease in insurance expense of $0.7 million due to renegotiation of insurance policies, and a $0.3 million decrease in digital marketing spend related to the Company’s discontinuation of owned-and-operated direct-to-consumer businesses, partly offset by higher technology costs of $0.6 million.

Impairments

The decrease in impairments for the three months ended June 30, 2024, as compared to the prior year comparative period, was primarily due to $138.2 million of impairment charges on Playboy-branded trademarks, Honey Birdette’s trade names and goodwill as well as $8.1 million of impairment charges on a certain licensing contract recorded in the prior year comparative period, partly offset by $0.6 million of impairment charges on our corporate leases in the second quarter of 2024.

Other Operating Income, Net

The decrease in other operating income, net was due to the gain on sale of our crypto assets in the prior year comparative period.

Nonoperating (Expense) Income

Interest Expense

The increase in interest expense for the three months ended June 30, 2024, as compared to the prior year comparative period, was primarily due to the higher interest rate on our senior secured debt in the second quarter of 2024, compared to the prior year comparative period, as a result of the amendment and restatement of our senior secured debt in May 2023 and the A&R First Amendment in November 2023.

Gain on Extinguishment of Debt

Gain on extinguishment of debt for the three months ended June 30, 2023 represented a gain of $8.0 million due to the partial extinguishment of debt upon the amendment and restatement of our senior secured credit agreement.

Fair Value Remeasurement Gain

Fair value remeasurement gain for the three months ended June 30, 2023 represented the remeasurement of our mandatorily redeemable preferred stock liability to its fair value recorded during the period upon exchange (and thereby elimination) of such preferred stock in connection with the amendment and restatement of our senior secured credit agreement.

Other (Expense) Income, Net

The change in other (expense) income, net for the three months ended June 30, 2024, as compared to the prior year comparative period, was immaterial.

(Expense) Benefit from Income Taxes

The change from benefit from income taxes to expense for the three months ended June 30, 2024, as compared to the prior year comparative period, was primarily driven by the change in valuation allowance due to the reduction in net indefinite-lived deferred tax liabilities, offset by increased foreign income taxes in the three months ended June 30, 2024.

Comparison of the Six Months Ended June 30, 2024 and 2023

The following table summarizes key components of our results of operations for the periods indicated (in thousands, except percentages):


	Six Months Ended June 30,
	2024		2023		$ Change		% Change
Net revenues	$	53,204	$	70,304	$	(17,100)	(24)	%
Costs and expenses:
Cost of sales	(20,525)		(31,436)		10,911		(35)	%
Selling and administrative expenses	(47,801)		(73,912)		26,111		(35)	%
Impairments	(3,016)		(146,240)		143,224		(98)	%
Other operating income, net	18		249		(231)		(93)	%
Total operating expense	(71,324)		(251,339)		180,015		(72)	%
Operating loss	(18,120)		(181,035)		162,915		(90)	%
Nonoperating (expense) income:
Interest expense	(13,015)		(10,966)		(2,049)		19	%
Gain on extinguishment of debt	—		6,133		(6,133)		(100)	%
Fair value remeasurement gain	—		6,505		(6,505)		(100)	%
Other (expense) income, net	(295)		250		(545)		(218)	%
Total nonoperating (expense) income	(13,310)		1,922		(15,232)		over 250%
Loss from continuing operations before income taxes	(31,430)		(179,113)		147,683		(82)	%
(Expense) benefit from income taxes	(1,669)		10,538		(12,207)		(116)	%
Net loss from continuing operations	(33,099)		(168,575)		135,476		(80)	%
Loss from discontinued operations, net of tax	—		(920)		920		(100)	%
Net loss	(33,099)		(169,495)		136,396		(80)	%
Net loss attributable to PLBY Group, Inc.	$	(33,099)	$	(169,495)	$	136,396	(80)	%

The following table sets forth our condensed consolidated statements of operations data expressed as a percentage of total revenue for the periods indicated:


	Six Months Ended June 30,
	2024		2023
Net revenues	100	%	100	%
Costs and expenses:
Cost of sales	(39)		(45)
Selling and administrative expenses	(90)		(105)
Impairments	(6)		(208)
Other operating income, net	—		—
Total operating expense	(135)		(358)
Operating loss	(35)		(258)
Nonoperating (expense) income:
Interest expense	(24)		(16)
Gain on extinguishment of debt	—		9
Fair value remeasurement gain	—		9
Other (expense) income, net	(1)		—
Total nonoperating (expense) income	(25)		2
Loss from continuing operations before income taxes	(60)		(256)
(Expense) benefit from income taxes	(3)		15
Net loss from continuing operations	(63)		(241)
Loss from discontinued operations, net of tax	—		(1)
Net loss	(63)		(242)
Net loss attributable to PLBY Group, Inc.	(63)	%	(242)	%

Net Revenues

The decrease in net revenues for the six months ended June 30, 2024, as compared to the prior year comparative period, was primarily due to lower licensing revenue of $10.6 million, largely driven by the termination of certain Chinese licensing agreements in 2023, lower direct-to-consumer revenue of $7.2 million, as a result of $4.9 million less revenue from Playboy’s e-commerce site, as it changed from our ownership and operation to a licensed business model in the third quarter of 2023, and a $2.3 million decrease in revenue from Honey Birdette, partly offset by $1.3 million of higher revenue from our creator platform.

Cost of Sales

The decrease in cost of sales for the six months ended June 30, 2024, as compared to the prior year comparative period, was primarily due to a decrease in inventory reserve charges of $7.1 million, a $3.2 million decrease in direct-to-consumer product costs from Playboy’s e-commerce site, as it changed from our ownership and operation to a licensed business model in the third quarter of 2023, lower licensing product costs of $0.9 million due to the termination of Playboy’s e-commerce licensing agreement in the second quarter of 2024, and lower digital subscriptions product costs of $1.2 million, which was partly offset by higher licensing commissions of $1.5 million, primarily due to a partial reversal of commission accrual in the prior year comparative period related to the termination of certain Chinese licensing agreements.

Selling and Administrative Expenses

The decrease in selling and administrative expenses for the six months ended June 30, 2024, as compared to the prior year comparative period, was primarily due to a $5.6 million decrease in stock-based compensation expense, lower technology costs of $4.9 million, primarily due to a $4.6 million restructuring charge taken on direct-to-consumer cloud-based software attributable to continuing operations in 2023, lower payroll expense of $4.0 million due to headcount reductions, lower severance expense of $2.3 million, a $2.1 million decrease in China JV expense due to cost cuts and non-recurring transaction expenses in 2023, lower audit, legal and consulting fees of $2.9 million, a $1.8 million decrease in digital marketing spend related to the Company’s discontinuation of owned-and-operated direct-to-consumer businesses, and lower insurance expense of $1.9 million due to renegotiation of insurance policies.

Impairments

The decrease in impairments for the six months ended June 30, 2024, as compared to the prior year comparative period, was primarily due to $138.2 million of impairment charges on Playboy-branded trademarks, Honey Birdette’s trade names and goodwill as well as $8.1 million of impairment charges on a certain licensing contract recorded in the prior year comparative period, partly offset by $2.4 million of impairment charges on our artwork held for sale in the first quarter of 2024 and $0.6 million of impairment charges on our corporate leases in the second quarter of 2024.

Other Operating Income, Net

The decrease in other operating income, net was due to the gain on sale of our crypto assets in the prior year comparative period.

Nonoperating (Expense) Income

Interest Expense

The increase in interest expense for the six months ended June 30, 2024, as compared to the prior year comparative period, was primarily due to the higher interest rate on our senior secured debt during the six months ended June 30, 2024, compared to the prior year comparative period, as a result of the amendment and restatement of our senior secured debt in May 2023 and the A&R First Amendment in November 2023.

Gain on Extinguishment of Debt

Gain on extinguishment of debt for the six months ended June 30, 2023 represented a $8.0 million gain due to the partial extinguishment of debt upon the amendment and restatement of our senior secured credit agreement in the second quarter of 2023, net of a $1.8 million loss recorded in the first quarter of 2023 due to the partial extinguishment of debt related to $45 million of prepayments of our senior debt.

Fair Value Remeasurement Gain

Fair value remeasurement gain for the six months ended June 30, 2023 represented the remeasurement of our mandatorily redeemable preferred stock liability to its fair value during the period, which was exchanged (and thereby eliminated) in connection with the A&R Credit Agreement in the second quarter of 2023.

Other (Expense) Income, Net

The change in other (expense) income, net for the six months ended June 30, 2024, as compared to the prior year comparative period, was immaterial.

(Expense) Benefit from Income Taxes

The change from benefit from income taxes to expense for the six months ended June 30, 2024, as compared to the prior year comparative period, was primarily driven by the change in valuation allowance due to a reduction in net indefinite-lived deferred tax liabilities, offset by increased foreign income taxes in the six months ended June 30, 2024.

Non-GAAP Financial Measures

In addition to our results determined in accordance with GAAP, we believe the following non-GAAP measure is useful in evaluating our operational performance. We use the following non-GAAP financial information to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that non-GAAP financial information, when taken collectively, may be helpful to investors in assessing our operating performance.

EBITDA and Adjusted EBITDA

“EBITDA” is defined as net income or loss before results from discontinued operations, interest, income tax expense or benefit, and depreciation and amortization. “Adjusted EBITDA” is defined as EBITDA adjusted for stock-based compensation and other special items determined by management. Adjusted EBITDA is intended as a supplemental measure of our performance that is neither required by, nor presented in accordance with, GAAP. We believe that the use of EBITDA and Adjusted EBITDA provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with those of comparable companies, which may present similar non-GAAP financial measures to investors. However, investors should be aware that when evaluating EBITDA and Adjusted EBITDA, we may incur future expenses similar to those excluded when calculating these measures. In addition, our presentation of these measures should not be construed as an inference that our future results will be unaffected by unusual or nonrecurring items. Our computation of Adjusted EBITDA may not be comparable to other similarly titled measures computed by other companies, because not all companies may calculate Adjusted EBITDA in the same fashion.

In addition to adjusting for non-cash stock-based compensation, non-cash charges for the fair value remeasurements of certain liabilities and non-recurring non-cash impairments, asset write-downs and inventory reserve charges, we typically adjust for non-operating expenses and income, such as non-recurring special projects, including the implementation of internal controls, non-recurring gain or loss on the sale of assets, expenses associated with financing activities, and reorganization and severance expenses that result from the elimination or rightsizing of specific business activities or operations.

Because of these limitations, EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our GAAP results and using EBITDA and Adjusted EBITDA on a supplemental basis. Investors should review the reconciliation of net loss to EBITDA and Adjusted EBITDA below and not rely on any single financial measure to evaluate our business.

The following table reconciles net loss to EBITDA and Adjusted EBITDA (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net loss	$	(16,652)	$	(131,815)	$	(33,099)	$	(169,495)
Adjusted for:
(Income) loss from discontinued operations, net of tax	—		(452)		—		920
Net loss from continuing operations	(16,652)		(132,267)		(33,099)		(168,575)
Adjusted for:
Interest expense	6,588		5,757		13,015		10,966
Gain on extinguishment of debt	—		(7,980)		—		(6,133)
Expense (benefit) from income taxes	616		(8,868)		1,669		(10,538)
Depreciation and amortization	2,511		1,848		4,311		3,537
EBITDA	(6,937)		(141,510)		(14,104)		(170,743)
Adjusted for:
Stock-based compensation	2,005		3,151		3,839		8,370
Impairments	599		146,240		3,016		146,240
Inventory reserve charges	—		—		—		3,637
Mandatorily redeemable preferred stock fair value remeasurement	—		(9,523)		—		(6,505)
Write-down of capitalized software	—		—		—		4,632
Adjustments	1,397		1,548		1,764		4,576
Adjusted EBITDA	$	(2,936)	$	(94)	$	(5,485)	$	(9,793)

•Impairments for the three months ended June 30, 2024 related primarily to the impairments of corporate leases.

•Impairments for the six months ended June 30, 2024 related to impairment charges on our artwork held for sale and corporate leases.

•Impairments for the three and six months ended June 30, 2023 related primarily to the impairments of intangible assets, including goodwill and impairments on certain of our licensing contracts.

•Inventory reserve charges for the six months ended June 30, 2023 related to non-cash inventory reserve charges, excluding certain ordinary inventory reserve items, recorded in the first quarter of 2023 to reflect the restructuring of the Playboy Direct-to-Consumer business.

•Mandatorily redeemable preferred stock fair value remeasurement for the three and six months ended June 30, 2023 related to the fair value remeasurement, non-cash fair value gain of the liability for such preferred stock.

•Write-down of capitalized software for the six months ended June 30, 2023 related to a $4.6 million restructuring charge taken on direct-to-consumer cloud-based software in the first quarter of 2023, excluding $0.4 million of costs related to discontinued operations.

•Adjustments for the three and six months ended June 30, 2024 are primarily related to non-cash fair value change related to contingent liabilities fair value remeasurement with respect to potential shares issuable for the acquisition of GlowUp that remained unsettled as of June 30, 2024, loss on the sale of artwork, consulting, advisory and other costs relating to corporate transactions and other strategic opportunities as well as reorganization and severance costs resulting in the elimination or rightsizing of specific business activities or operations.

•Adjustments for the three and six months ended June 30, 2023 are related to non-cash fair value change related to contingent liabilities fair value remeasurement with respect to potential shares issuable for the acquisition of GlowUp that remained unsettled as of June 30, 2023, consulting, advisory and other costs relating to corporate transactions and other strategic opportunities, as well as reorganization and severance costs resulting in the elimination or rightsizing of specific business activities or operations.

Segments

Our Chief Executive Officer is our Chief Operating Decision Maker. Our segment disclosure is based on our intention to provide the users of our condensed consolidated financial statements with a view of the business from our perspective. We operate our business in three primary operating and reportable segments: Direct-to-Consumer, Licensing, and Digital Subscriptions and Content. Direct-to-Consumer operations include consumer products sold through brick-and-mortar retail stores and e-commerce sites. Licensing operations include the licensing of one or more of our trademarks, our Playboy retail platform operations effective July 2023, and/or images for consumer products and location-based entertainment businesses. Digital Subscriptions and Content operations include the production, marketing and sales of programming under the Playboy brand name, which is distributed through various channels, including domestic and international television, and sales of creator content offerings and memberships to consumers through the Playboy Club on playboy.com.

Comparison of the Three Months Ended June 30, 2024 and 2023

The following are our results of financial performance from continuing operations by segment for each of the periods presented (in thousands):


	Three Months Ended June 30,
	2024		2023		$ Change		% Change
Net revenues:
Direct-to-Consumer	$	14,504	$	19,700	$	(5,196)	(26)	%
Licensing	5,272		10,288		(5,016)		(49)	%
Digital Subscriptions and Content	5,109		5,112		(3)		—	%
All Other	—		1		(1)		(100)	%
Total	$	24,885	$	35,101	$	(10,216)	(29)	%
Operating (loss) income:
Direct-to-Consumer	$	(2,365)	$	(75,002)	$	72,637	(97)	%
Licensing	4,323		(65,131)		69,454		(107)	%
Digital Subscriptions and Content	(2,215)		1,002		(3,217)		over 150%
Corporate	(8,948)		(13,918)		4,970		(36)	%
All Other	2		(7)		9		(129)	%
Total	$	(9,203)	$	(153,056)	$	143,853	(94)	%

Direct-to-Consumer

The decrease in net revenues for the three months ended June 30, 2024, compared to the comparable prior year period, was primarily due to a $3.8 million decrease in revenue from Honey Birdette and $1.4 million less revenue from Playboy’s e-commerce site, as it changed from our ownership and operation to a licensed business model in the third quarter of 2023.

The decrease in operating loss for the three months ended June 30, 2024, compared to the comparable prior year period, was primarily due to $72.6 million of non-cash impairment charges on certain of our intangible assets, including goodwill, recorded in the second quarter of 2023, lower payroll expense of $1.4 million due to headcount reductions, a decrease in inventory reserve charges of $0.7 million, a $0.4 million decrease in digital marketing spend and $1.4 million lower gross profit as a result of lower revenue.

Licensing

The decrease in net revenues for the three months ended June 30, 2024, compared to the comparable prior year period, was primarily due to the termination of certain Chinese licensing agreements in 2023.

The improvement from an operating loss to a gain for the three months ended June 30, 2024, compared to the comparable prior year period, was primarily due to $65.5 million of non-cash impairment charges on our trademarks and the $8.1 million impairment of a certain licensing contract in the prior year comparative period, lower licensing product costs of $0.9 million due to the termination of Playboy’s e-commerce licensing agreement in the second quarter of 2024 and a $3.1 million decrease in legal fees and China JV expenses, partly offset by a $4.1 million decrease in licensing gross profit as a result of lower revenue and a $3.5 million increase in licensing commissions primarily due to a nonrecurring reduction in commission accrual in the prior year comparative period related to the termination of certain Chinese licensing agreements.

Digital Subscriptions and Content

The decrease in net revenues for the three months ended June 30, 2024, compared to the comparable prior year period, was primarily due to a $0.3 million increase in net revenue from our creator platform, partly offset by a $0.3 million decrease in other digital subscriptions and content revenue.

The decrease in operating income for the three months ended June 30, 2024, compared to the comparable prior year period, was primarily due to a $2.3 million increase in expenses related to our creator platform and a $1.1 million reversal of stock-based compensation expense in the prior year comparative period.

Corporate

The decrease in corporate expenses for the three months ended June 30, 2024, compared to the comparable prior year period, was primarily due to a $3.3 million decrease in stock-based compensation expense, a decrease of $0.7 million in insurance expense and a $0.9 million decrease in payroll expenses due to headcount reductions.

Comparison of the Six Months Ended June 30, 2024 and 2023

The following are our results of financial performance from continuing operations by segment for each of the periods presented (in thousands):


	Six Months Ended June 30,
	2024		2023		$ Change		% Change
Net revenues:
Direct-to-Consumer	$	33,244	$	40,468	$	(7,224)	(18)	%
Licensing	9,357		19,982		(10,625)		(53)	%
Digital Subscriptions and Content	10,603		9,850		753		8	%
All Other	—		4		(4)		(100)	%
Total	$	53,204	$	70,304	$	(17,100)	(24)	%
Operating (loss) income:
Direct-to-Consumer	$	(1,483)	$	(90,058)	$	88,575	(98)	%
Licensing	6,340		(61,564)		67,904		(110)	%
Digital Subscriptions and Content	(2,314)		393		(2,707)		over 150%
Corporate	(20,675)		(29,794)		9,119		(31)	%
All Other	12		(12)		24		over 150%
Total	$	(18,120)	$	(181,035)	$	162,915	(90)	%

Direct-to-Consumer

The decrease in net revenues for the six months ended June 30, 2024, compared to the comparable prior year period, was primarily due to $4.9 million less revenue from Playboy’s e-commerce site, as it changed from our ownership and operation to a licensed business model in the third quarter of 2023, and a $2.3 million decrease in revenue from Honey Birdette.

The decrease in operating loss for the six months ended June 30, 2024, was primarily due to $72.6 million of non-cash impairment charges on certain of our intangible assets, including goodwill, recorded in the prior year comparative period, a decrease in inventory reserve charges of $7.1 million, lower technology costs of $5.5 million, primarily due to a $4.6 million restructuring charge taken on direct-to-consumer cloud-based software attributable to continuing operations in 2023, lower payroll expense of $3.6 million due to headcount reductions, a $1.9 million decrease in digital marketing spend related to our discontinuation of owned-and-operated direct-to-consumer businesses, a $0.9 million decrease in other selling and administrative expenses, partly offset by $2.5 million lower gross profit as a result of lower revenue.

Licensing

The decrease in net revenues for the six months ended June 30, 2024, compared to the comparable prior year period, was primarily due to the termination of certain Chinese licensing agreements in 2023.

The decrease in operating loss for the six months ended June 30, 2024, compared to the comparable prior year period, was primarily due to $65.5 million of non-cash impairment charges and $8.1 million of impairment of a certain licensing contract in the prior year comparative period, lower licensing product costs of $0.9 million due to the termination of Playboy’s e-commerce licensing agreement in the second quarter of 2024 and a $4.9 million decrease in legal fees and China JV expenses, partly offset by a $10.6 million decrease in licensing gross profit as a result of lower revenue and higher licensing commissions of $1.5 million, primarily due to a partial reversal of commission accrual in the prior year comparative period related to the termination of certain Chinese licensing agreements.

Digital Subscriptions and Content

The increase in net revenues for the six months ended June 30, 2024, compared to the comparable prior year period, was primarily due to a $1.3 million increase in net revenues from our creator platform, partly offset by a $0.5 million decrease in other digital subscriptions and content revenue.

The change from operating income to a loss for the six months ended June 30, 2024, compared to the comparable prior year period, was primarily due to a $3.5 million increase in expenses related to our creator platform and a $1.1 million reversal of stock based-compensation in the prior year comparative period, partly offset by a $0.8 million increase in net revenues and a $0.5 million decrease in payroll.

Corporate

The decrease in corporate expenses for the six months ended June 30, 2024, compared to the comparable prior year period, was primarily due to a $7.0 million decrease in stock-based compensation expense, a $1.2 million decrease in severance costs, a decrease of $1.9 million in insurance expense, a decrease of $0.8 million in audit and consulting services and a $1.9 million decrease in payroll expenses due to headcount reductions, partly offset by $2.4 million of impairments on our artwork held for sale and a loss of $0.5 million on the sale of assets in the first quarter of 2024.

Liquidity and Capital Resources

Sources of Liquidity

Our sources of liquidity are cash generated from operating activities, which primarily includes cash derived from revenue generating activities, from financing activities, including proceeds from our issuance of debt, and proceeds from stock offerings (as described further below), and from investing activities, which includes the sale of assets (as described further below). As of June 30, 2024, our principal source of liquidity was cash in the amount of $16.9 million, which is primarily held in operating and deposit accounts.

On January 24, 2023, we issued 6,357,341 shares of our common stock in a registered direct offering to a limited number of investors. We received $15 million in gross proceeds from the registered direct offering, and net proceeds of $13.9 million, after the payment of offering fees and expenses.

We also completed a rights offering in February 2023, pursuant to which we issued 19,561,050 shares of common stock. We received net proceeds of approximately $47.6 million from the rights offering, after the payment of offering fees and expenses. We used $45 million of the net proceeds from the rights offering for repayment of debt under our senior secured credit agreement, with the remainder to be used for other general corporate purposes.

On April 4, 2023, we completed the Yandy Sale to an unaffiliated, third-party buyer. The consideration we received for the Yandy Sale consisted of $1.0 million in cash and a $2.0 million secured promissory note payable over three years (which note was then settled in the third quarter of 2023 for a cash payment to us of $1.3 million).

On November 3, 2023, we completed the TLA Sale to an unaffiliated, third-party buyer for approximately $13.5 million in cash (the “Purchase Price”). Approximately $2.1 million of the Purchase Price was placed into a short-term escrow account at the closing of the TLA Sale in connection with a post-closing working capital adjustment, certain possible indemnification claims payable by us and for certain post-closing items to be completed by us. As of the date of this Quarterly Report on Form 10-Q, such escrow funds had been released to us in full.

In November 2023, we also sold a small amount of our art assets, and we have continued the sale of our art assets in 2024.

Due to challenging economic conditions in China, collections from certain of our Chinese licensees slowed significantly in 2022 and 2023, and we have renegotiated terms of certain agreements. In October 2023, we also terminated licensing agreements with certain Chinese licensees. We have replaced certain terminated licensees with new licensees in China. Future contract modifications and collectability issues could further impact the revenue recognized against our ongoing contract assets.

Since going public in 2021, we have yet to generate operating income from our core business operations and have incurred significant operating losses. Our operating losses for the six months ended June 30, 2024 were $18.1 million. We expect to continue to incur operating losses for the foreseeable future.

We evaluated whether there are any conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern over the next twelve months from the date of filing this Quarterly Report on Form 10-Q. Although consequences of ongoing macroeconomic uncertainty could adversely affect our liquidity and capital resources in the future, and cash requirements may fluctuate based on the timing and extent of many factors, such as those discussed above, we believe our existing sources of liquidity, along with proceeds from asset dispositions and savings from cost reductions initiatives, will be sufficient to meet our obligations as they become due under the A&R Credit Agreement and our other obligations for at least one year following the date of the filing of this Quarterly Report on Form 10-Q. We may seek additional equity or debt financing in the future to satisfy capital requirements, respond to adverse developments such as changes in our circumstances or unforeseen events or conditions, or fund organic or inorganic growth opportunities. However, in the event that additional financing is required from third-party sources, we may not be able to raise it on acceptable terms or at all.

Debt

On May 10, 2023, we entered into an amendment and restatement of our prior credit agreement to reduce the interest rate applicable to our senior secured debt and the implied interest rate on our Series A Preferred Stock, exchange (and thereby eliminate) our outstanding Series A Preferred Stock, and obtain additional covenant relief and funding. For the terms of the 2021 Credit Agreement, as amended, refer to Note 10. Debt, within the notes to our audited consolidated financial statements set forth in our Annual Report on Form 10-K filed with the SEC on March 29, 2024.

In connection with the A&R Credit Agreement, Fortress Credit Corp. and its affiliates became our lender with respect to approximately 90% of the term loans under the A&R Credit Agreement. Fortress exchanged 50,000 shares of our Series A Preferred Stock (representing all of our issued and outstanding preferred stock) for approximately $53.6 million of the A&R Term Loans, and we obtained approximately $11.8 million of additional funding as part of the A&R Term Loans. As a result, our Series A Preferred Stock was eliminated, and the principal balance of the A&R Term Loans under the A&R Credit Agreement became approximately $210.0 million on the Restatement Date.

In connection with the A&R Credit Agreement, the term loan under the 2021 Credit Agreement was apportioned into approximately $20.6 million of Tranche A term loans and approximately $189.4 million of Tranche B term loans. The prior amortization payments applicable to the term loan under the 2021 Credit Agreement were eliminated. The A&R Credit Agreement only requires that the smaller Tranche A be subject to quarterly amortization payments of approximately $76,000 per quarter. The benchmark rate for the A&R Term Loans is the applicable term of SOFR as published by the U.S. Federal Reserve Bank of New York (rather than LIBOR, as under the 2021 Credit Agreement). As of the Restatement Date, Tranche A accrued interest at SOFR plus 6.25% and 0.10% SOFR adjustment, with a SOFR floor of 0.50%. As of the Restatement Date, Tranche B accrued interest at SOFR plus 4.25% and 0.10% SOFR adjustment, with a SOFR floor of 0.50%.

In July 2023, DBD Credit Funding LLC, an affiliate of Fortress, became the administrative agent and collateral agent under the A&R Credit Agreement.

In connection with the TLA Sale, on November 2, 2023, we entered into Amendment No. 1 to the A&R Credit Agreement, to permit, among other things: (a) the TLA Sale and the sale of certain other assets (and the proceeds of such sales will not be required to prepay the A&R Term Loans); and (b) the Company to elect, through August 31, 2025, to pay in cash accrued interest equal to the applicable SOFR plus 1.00%, with the remainder of any applicable accrued interest not paid in cash capitalized into the A&R Term Loans. The other terms of the A&R Credit Agreement remained substantially unchanged from those prior to the A&R First Amendment.

On March 27, 2024, we entered into Amendment No. 2 to the A&R Credit Agreement, which provided for, among other things:

The other terms of the A&R Credit Agreement prior to the A&R Second Amendment remained substantially unchanged.

Leases

Our principal lease commitments are for office space and operations under several noncancelable operating leases with contractual terms expiring through 2033. Some of these leases contain renewal options and rent escalations. As of June 30, 2024 and December 31, 2023, our fixed leases were $27.1 million and $31.6 million, respectively, with $6.4 million and $7.0 million due in the next 12 months. For further information on our lease obligations, refer to Note 11, Commitments and Contingencies within the notes to the financial statements included in this Quarterly Report on Form 10-Q.

Cash Flows

The following table summarizes our cash flows from continuing operations for the periods indicated (in thousands):


	Six Months Ended June 30,
	2024		2023		$ Change		% Change
Net cash (used in) provided by:
Operating activities	$	(12,780)	$	(26,653)	$	13,873	(52)	%
Investing activities	328		248		80		32	%
Financing activities	(215)		27,334		(27,549)		(101)	%

Cash Flows from Operating Activities

The decrease in net cash used in operating activities from continuing operations for six months ended June 30, 2024, compared to the prior year comparable period, was primarily due to a reduction in net loss from continuing operations of $135.5 million, partly offset by changes in assets and liabilities that had a current period cash flow impact, such as $0.4 million of net changes in working capital and $121.2 million of changes in non-cash charges. The change in assets and liabilities, as compared to the prior year comparable period, was primarily driven by a $13.9 million decrease in deferred revenues due to the termination of certain Chinese licensing agreements in the prior year comparative period, an increase of $1.4 million in prepaid expenses and other assets primarily due to a restructuring charge taken on direct-to-consumer cloud-based software in the prior year comparable period, a $3.2 million decrease in operating lease liabilities, and a $2.1 million decrease in other liabilities, net, partly offset by a $4.8 million decrease in accounts receivable due to the timing of royalties collections and modifications of certain trademark licensing contracts, a $15.1 million decrease in contract assets due to the impairment, modification or termination of certain trademark licensing contracts, and a $1.0 million increase in accounts payable due to the timing of payments. The change in non-cash charges, compared to the change in the prior year comparable period, was primarily driven by a $143.2 million decrease in non-cash impairment charges, a $4.5 million decrease in stock-based compensation expense, and a decrease in inventory reserve charges of $6.7 million, partly offset by a $2.6 million increase in amortization of right-of-use assets, a $6.1 million net gain on the extinguishment of debt in 2023, a $6.7 million change in fair value remeasurement charges, a $11.7 million increase in deferred income taxes, and $3.7 million of capitalized paid-in-kind interest.

Cash Flows from Investing Activities

The increase in net cash provided by investing activities for the six months ended June 30, 2024 over the prior year comparable period was primarily due to proceeds from the sale of certain of our artwork of $1.6 million, partly offset by $1.0 million of proceeds from the Yandy Sale in the prior year comparable period and a $0.5 million increase in purchases of property and equipment.

Cash Flows from Financing Activities

The decrease in net cash provided by financing activities for the six months ended June 30, 2024, compared to the prior year comparable period, was due to net proceeds of $13.9 million from our registered direct offering in January of 2023, net proceeds of $47.6 million from the issuance of common stock in our rights offering in February of 2023, and gross proceeds of $11.8 million from the amendment and restatement of our senior secured debt in the second quarter of 2023, partly offset by a $45.3 million decrease in the repayment of long-term debt from the proceeds of our equity offerings.

Contractual Obligations

For the six months ended June 30, 2024, there were no material changes to our contractual obligations from December 31, 2023, as disclosed in our audited consolidated financial statements included in our Annual Report on Form 10-K filed on March 29, 2024.

Critical Accounting Estimates

Our interim condensed consolidated financial statements have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the condensed consolidated financial statements, as well as the reported expenses incurred during the reporting periods. Estimates and judgments used in the preparation of our interim condensed consolidated financial statements are, by their nature, uncertain and unpredictable, and depend upon, among other things, many factors outside of our control, such as demand for our products, inflation, foreign currency exchange rates, economic conditions and other current and future events, such as the impact of public health crises and epidemics and global hostilities. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

During the six months ended June 30, 2024, there were no material changes to our critical accounting policies or in the methodology used for estimates from those described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K filed with the SEC on March 29, 2024.

Recent Accounting Pronouncements

Refer to Note 1, Basis of Presentation and Summary of Significant Accounting Policies, within the notes to the to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for more information about recent accounting pronouncements, the timing of their adoption, and our assessment, to the extent we have made one, of their potential impact on our financial condition and results of operations.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We are exposed to a variety of market and other risks, including the effects of changes in interest rates, inflation, and foreign currency exchange rates, as well as risks to the availability of funding sources, hazard events, and specific asset risks.

Interest Rate Risk

The market risk inherent in our financial instruments and our financial position represents the potential loss arising from adverse changes in interest rates. As of June 30, 2024 and December 31, 2023, we had unrestricted cash and cash equivalents of $16.9 million and $28.1 million, respectively, primarily held in interest-bearing deposit accounts for which the fair market value would be affected by changes in the general level of U.S. interest rates. As of June 30, 2024 and December 31, 2023, we had restricted cash of $2.0 million and $3.6 million, respectively, of which $0.5 million was held in interest-bearing deposit accounts. However, an immediate 10% change in interest rates would not have a material effect on the fair market value of our cash and restricted cash and cash equivalents.

In order to maintain liquidity and fund business operations, our long-term A&R Term Loans are subject to a variable interest rate based on prime, federal funds, or SOFR plus an applicable margin based on our total net leverage ratio. The nature and amount of our long-term debt can be expected to vary as a result of future business requirements, market conditions, and other factors. We may elect to enter into interest rate swap contracts to reduce the impact associated with interest rate fluctuations, but as of June 30, 2024, we have not entered into any such contracts.

As of June 30, 2024 and December 31, 2023, we had outstanding debt obligations of $215.2 million and $211.6 million, respectively, which accrued interest at a rate of 11.68% and 9.68% for Tranche A and Tranche B term loans, respectively, during the second quarter of 2024. Based on the balance outstanding under our A&R Term Loans at June 30, 2024, we estimate that a 0.5% or 1% increase or decrease in underlying interest rates would increase or decrease annual interest expense by $1.1 million or $2.3 million, respectively, in any given fiscal year. See also our “Risk Factors—Risks Related to Our Business and Industry—Our variable rate debt subjects us to interest rate risk that could cause our debt service obligations to increase significantly.” included in Item 1A of our Annual Report on Form 10-K filed on March 29, 2024.

Foreign Currency Risk

We transact business in various foreign currencies and have significant international revenues, as well as costs denominated in foreign currencies other than the U.S. dollar, primarily the Australian dollar. Accordingly, changes in exchange rates, and in particular a strengthening of the U.S. dollar, have in the past, and may in the future, negatively affect our revenue and other operating results as expressed in U.S. dollars. For the three months ended June 30, 2024 and 2023, we derived approximately 54% and 57%, respectively, of our revenue from outside the United States, out of which 34% and 30%, respectively, was denominated in foreign currency. For the six months ended June 30, 2024 and 2023, we derived approximately 52% and 56%, respectively, of our revenue from outside the United States, out of which 36% and 29%, respectively, was denominated in foreign currency. We expect the percentage of revenue derived from outside the United States to increase in future periods as we continue to expand globally. Revenue and related expenses generated from our international operations (other than most international licenses) are denominated in the functional currencies of the corresponding country. The functional currency of our subsidiaries that either operate in or support these markets is generally the same as the corresponding local currency. The majority of our international licenses are denominated in U.S. dollars. The results of operations of, and certain of our intercompany balances associated with, our international operations are exposed to foreign exchange rate fluctuations. Upon consolidation, as exchange rates vary, our revenue and other operating results may differ materially from expectations, and we may record significant gains or losses on the remeasurement of intercompany balances. We do not have an active foreign exchange hedging program.

There are numerous factors impacting the amount by which our financial results are affected by foreign currency translation and transaction gains and losses resulting from changes in currency exchange rates, including, but not limited to, the volume of foreign currency-denominated transactions in a given period. Foreign currency transaction exposure from a 10% movement of currency exchange rates would have a material impact on our results, assuming no foreign currency hedging. For the three and six months ended June 30, 2024, we recorded an unrealized gain of $0.8 million and unrealized loss of $0.9 million, respectively, which is included in accumulated other comprehensive loss as of June 30, 2024. This was primarily related to the decrease and increase in the U.S. dollar against the Australian dollar during the three and six months ended June 30, 2024, respectively.

Inflation Risk

Inflationary factors such as increases in the cost of our product and overhead costs may adversely affect our operating results. Although we do not believe that inflation has had a material impact on our financial position or results of operations in recent periods, a high rate of inflation in the future may have an adverse effect on our ability to maintain or improve current levels of revenue, gross margin and selling and administrative expenses, or the ability of our customers to make discretionary purchases of our goods and services. See our “Risk Factors—Risks Related to Our Business and Industry—Our business depends on consumer purchases of discretionary goods and content, which can be negatively impacted during an economic downturn or periods of inflation. This could materially impact our sales, profitability and financial condition,” included in Item 1A of our Annual Report on Form 10-K filed on March 29, 2024.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation and supervision of our Chief Executive Officer and our Chief Financial Officer, have evaluated our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures were not effective due to the material weaknesses in our internal control over financial reporting described below. However, after giving full consideration to such material weaknesses, and the additional analyses and other procedures that we performed to ensure that our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q were prepared in accordance with GAAP, our management has concluded that our consolidated financial statements present fairly, in all material respects, our financial position, results of operations and cash flows for the periods disclosed in conformity with GAAP.

Management has determined that the Company had the following material weaknesses in its internal control over financial reporting:

Control Environment, Risk Assessment, and Monitoring

We did not maintain appropriately designed entity-level controls impacting the control environment, risk assessment procedures, and effective monitoring controls to prevent or detect material misstatements to the consolidated financial statements. These deficiencies were attributed to: (i) lack of structure and responsibility, insufficient number of qualified resources and inadequate oversight and accountability over the performance of controls, (ii) ineffective identification and assessment of risks impacting internal control over financial reporting, and (iii) ineffective evaluation and determination as to whether the components of internal control were present and functioning.

Control Activities and Information and Communication

These material weaknesses contributed to the following additional material weaknesses within certain business processes and the information technology environment:

•We did not fully design, implement and monitor general information technology controls in the areas of program change management, user access, and segregation of duties for systems supporting substantially all of the Company’s internal control processes. Accordingly, the Company did not have effective automated process-level controls, and manual controls that are dependent upon the information derived from the IT systems are also determined to be ineffective.

•We did not design and implement, and retain appropriate documentation of formal accounting policies, procedures and controls across substantially all of the Company’s business processes to achieve timely, complete, accurate financial accounting, reporting, and disclosures. Additionally, we did not design and implement controls at the corporate level at a sufficient level of precision to provide for the appropriate level of oversight of business process activities and related controls.

•We did not appropriately design and implement management review controls at a sufficient level of precision around complex accounting areas and disclosure including asset impairments, revenue contracts, income tax, stock-based compensation and lease accounting.

•We did not appropriately design and implement controls over the existence, accuracy, completeness, valuation and cutoff of inventory.

Although these material weaknesses did not result in any material misstatement of our consolidated financial statements for the periods presented, they could lead to a material misstatement of account balances or disclosures. Accordingly, management has concluded that these control deficiencies constitute material weaknesses.

Remediation Efforts

We continue to work on designing and implementing effective internal controls measures to improve our internal control over financial reporting and remediate the material weaknesses. Our internal control remediation efforts include the following:

•We hired additional qualified accounting resources and outside resources to segregate key functions within our financial and information technology processes to support our internal controls over financial reporting.

•We are in the process of reassessing and formalizing the design of certain accounting and information technology policies relating to controls with respect to systems security and change management.

•We engaged an outside firm to assist management with (i) reviewing our current processes, procedures, and systems and assessing the design of controls to identify opportunities to enhance the design of controls that would address relevant risks identified by management, and (ii) enhancing and implementing protocols to retain sufficient documentary evidence of operating effectiveness of such controls.

In addition to implementing and refining the above activities, we expect to engage in additional remediation activities in coming fiscal years, including:

•Continuing to enhance and formalize our accounting, business operations, and information technology policies, procedures, and controls to achieve complete, accurate, and timely financial accounting, reporting and disclosures.

•Establishing effective general controls over our accounting and operating systems to ensure that our automated process level controls and information produced and maintained in our IT systems is relevant and reliable.

•Designing and implementing controls that address the completeness and accuracy of underlying data used in the performance of controls over accounting transactions and disclosures.

•Enhancing policies and procedures to retain adequate documentary evidence for certain management review controls over certain business processes including precision of review and evidence of review procedures performed to demonstrate effective operation of such controls.

•Developing monitoring controls and protocols that will allow us to timely assess the design and the operating effectiveness of controls over financial reporting and make necessary changes to the design of controls, if any.

While these actions and planned actions are subject to ongoing management evaluation and will require validation and testing of the design and operating effectiveness of internal controls over a sustained period of financial reporting cycles, we are committed to the continuous improvement of our internal control over financial reporting and will continue to diligently review our internal control over financial reporting.

Changes in Internal Control over Financial Reporting

As described above, we are in the process of implementing changes to our internal control over financial reporting to remediate the material weaknesses described herein. There have been no changes in our internal control over financial reporting during the quarter ended June 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on Effectiveness of Controls and Procedures

The effectiveness of any system of internal control over financial reporting, including ours, is subject to inherent limitations, including the exercise of judgment in designing, implementing, operating, and evaluating the controls and procedures, and the inability to eliminate misconduct completely. Accordingly, any system of internal control over financial reporting, including ours, no matter how well designed and operated, can only provide reasonable, not absolute assurances. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. We intend to continue to monitor and upgrade our internal controls as necessary or appropriate for our business, but there can be no assurance that such improvements will be sufficient to provide us with effective internal control over financial reporting.

Part II. OTHER INFORMATION

Item 1. Legal Proceedings.

We are party to pending litigation and claims in connection with the ordinary course of our business. We make provisions for estimated losses to be incurred in such litigation and claims, including legal costs, and we believe such provisions are adequate. Refer to Note 11, Commitments and Contingencies—Legal Contingencies, within the notes to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for a summary of material legal proceedings, in addition to Part I, Item 3, “Legal Proceedings” of our Annual Report on Form 10-K filed with the SEC on March 29, 2024.

Item 1A. Risk Factors.

In addition to the other information set forth in this Quarterly Report on Form 10-Q, including the risk factors set forth below, please carefully consider the risk factors described under the heading “Part I – Item 1A. Risk Factors” in our most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2023. Such risks described are not the only risks facing us. Additional risks and uncertainties not currently known to us, or that our management currently deems to be immaterial, also may adversely affect our business, financial condition and/or operating results.

There can be no assurance that our common stock will continue to be listed on The Nasdaq Global Market (“Nasdaq”) and the de- listing of our common stock could, among other things, limit investors’ ability to trade our common stock and negatively impact the price of our common stock and our ability to access the capital markets.

Our common stock is traded on Nasdaq under the symbol “PLBY”. To maintain our listing we are required to satisfy continued listing requirements, including the requirement commonly referred to as the minimum bid price rule (Nasdaq Listing Rule 5450(a)(1)). The minimum bid price rule requires that the closing bid price of our common stock be at least $1.00 per share. On June 27, 2024, we received a letter from the Staff of the Listing Qualifications Department of The Nasdaq Stock Market LLC indicating that based upon our common stock’s closing bid price during the previous 32 consecutive business days, we no longer satisfied the Nasdaq minimum bid price rule. The notice had no immediate effect on the listing of our common stock on Nasdaq, and we have until December 24, 2024 to regain compliance. If at any time during such 180-calendar day period the closing bid price of our common stock is at least $1.00 for a minimum of 10 consecutive business days, Nasdaq will provide us written confirmation of compliance and the matter will be closed. If we do not regain compliance by December 24, 2024, and we apply to transfer the listing of our common stock from The Nasdaq Global Market to The Nasdaq Capital Market, we may be eligible for an additional 180-calendar day compliance period, subject to satisfying the conditions in the applicable Nasdaq Listing Rules. However, there can be no assurance that we will be able to regain compliance with the minimum bid price rule or continue to satisfy other continued listing standards and maintain the listing of our common stock on Nasdaq. The suspension or delisting of our common stock, or the commencement of delisting proceedings, could, among other things, materially impair our stockholders’ ability to buy and sell shares of our common stock and could have an adverse effect on the market price of, and the efficiency of the trading market for, our common stock. Although we may effect a reverse stock split of our issued and outstanding common stock in the future, there can be no assurance that such reverse stock split will enable us to regain, or maintain, compliance with the Nasdaq minimum bid price requirement.

Any delisting determination by Nasdaq could seriously decrease or eliminate the value of an investment in our common stock and other securities linked to our common stock. While an alternative listing on an over-the-counter exchange could maintain some degree of a market in our common stock, we could face substantial material adverse consequences, including, but not limited to, the following: limited availability for market quotations for our common stock; reduced liquidity with respect to and decreased trading prices of our common stock; a determination that shares of our common stock are “penny stock” under the SEC rules, subjecting brokers trading our common stock to more stringent rules on disclosure and the class of investors to which the broker may sell the common stock; limited news and analyst coverage for our company, in part due to the “penny stock” rules; decreased ability to issue additional securities or obtain additional financing in the future; and potential breaches under or terminations of our agreements with current or prospective large stockholders, strategic investors and banks.

Item 2. Recent Sales of Unregistered Securities and Use of Proceeds.

During the six months ended June 30, 2024, we did not repurchase any shares of our common stock as authorized pursuant to the 2022 Stock Repurchase Program, which was authorized by the Company’s board of directors on May 14, 2022.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

No Rule 10b5‑1 plans or non-Rule 10b5-1 trading arrangements were adopted, modified or terminated by officers or directors of the Company, nor were there any material changes to the procedures by which security holders may recommend nominees to the Company’s board of directors, during the quarter ended June 30, 2024.

Item 6. Exhibits.


Exhibit No.						Description
3.1						Second Amended and Restated Certificate of Incorporation of PLBY Group, Inc. (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed with the SEC on February 16, 2021)
3.2						Amended and Restated Bylaws of PLBY Group, Inc. (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K filed with the SEC on February 16, 2021)
3.3						Certificate of Designation of the Series A Preferred Stock (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed with the SEC on May 17, 2022)
31.1*						Certification of the Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated pursuant to the Securities Exchange Act of 1934, as amended
31.2*						Certification of the Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated pursuant to the Securities Exchange Act of 1934, as amended
32.1**						Certification of the Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2**						Certification of the Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101						The following financial information from PLBY Group, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2024 are formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Condensed Consolidated Statements of Operations, (ii) Condensed Consolidated Balance Sheets, (iii) Condensed Consolidated Statements of Stockholders’ Equity, (iv) Condensed Consolidated Statements of Cash Flows, and (v) related notes (submitted electronically with this Quarterly Report on Form 10-Q)
101.INS						Inline XBRL Instance Document - the instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document (submitted electronically with this Quarterly Report on Form 10-Q)
101.SCH						Inline XBRL Taxonomy Extension Schema Document (submitted electronically with this Quarterly Report on Form 10-Q)
101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document (submitted electronically with this Quarterly Report on Form 10-Q)
101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document (submitted electronically with this Quarterly Report on Form 10-Q)
101.LAB						Inline XBRL Taxonomy Extension Labels Linkbase Document (submitted electronically with this Quarterly Report on Form 10-Q)
101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document (submitted electronically with this Quarterly Report on Form 10-Q)
104						Cover Page Interactive Data File, formatted in Inline XBRL and contained in Exhibit 101

_____________________

* Filed herewith.

** This certification is being furnished solely to accompany this quarterly report pursuant to 18 U.S.C. § 1350, and is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of PLBY Group, Inc., whether made before or after the date hereof, regardless of any general incorporation language in such filing.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	PLBY GROUP, INC.

Date: August 9, 2024	By:	/s/ Ben Kohn
	Name:	Ben Kohn
	Title:	Chief Executive Officer and President (principal executive officer)

Date: August 9, 2024	By:	/s/ Marc Crossman
	Name:	Marc Crossman
	Title:	Chief Financial Officer and Chief Operating Officer (principal financial officer and principal accounting officer)

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Ben Kohn, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of PLBY Group, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 9, 2024

By: /s/ Ben Kohn

Ben Kohn

Chief Executive Officer and President

(Principal Executive Officer)

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Marc Crossman, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of PLBY Group, Inc.;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 9, 2024

By: /s/ Marc Crossman

Marc Crossman

Chief Financial Officer and Chief Operating Officer

(Principal Financial Officer & Principal Accounting Officer)

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of PLBY Group, Inc. (the “Company”) on Form 10-Q for the period ended June 30, 2024, as filed with the Securities and Exchange Commission (the “Report”), Ben Kohn, Chief Executive Officer and President of the Company, certifies, to the best of his knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of and for the period covered by the Report.

Date: August 9, 2024

By: /s/ Ben Kohn

Ben Kohn

Chief Executive Officer and President

(Principal Executive Officer)

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of PLBY Group, Inc. (the “Company”) on Form 10-Q for the period ended June 30, 2024, as filed with the Securities and Exchange Commission (the “Report”), Marc Crossman, Chief Financial Officer and Chief Operating Officer of the Company, certifies, to the best of his knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of and for the period covered by the Report.

Date: August 9, 2024

By: /s/ Marc Crossman

Marc Crossman

Chief Financial Officer and Chief Operating Officer

(Principal Financial Officer & Principal Accounting Officer)

Cover Page - shares	6 Months Ended
Cover Page - shares	Jun. 30, 2024	Aug. 05, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2024
Document Transition Report	false
Entity File Number	001-39312
Entity Registrant Name	PLBY Group, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	37-1958714
Entity Address, Address Line One	10960 Wilshire Blvd., Suite 2200
Entity Address, City or Town	Los Angeles
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	90024
City Area Code	310
Local Phone Number	424-1800
Title of 12(b) Security	Common Stock, $0.0001 par value per share
Trading Symbol	PLBY
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		73,892,060
Entity Central Index Key	0001803914
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Amendment Flag	false

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Income Statement [Abstract]
Net revenues	$ 24,885	$ 35,101	$ 53,204	$ 70,304
Costs and expenses:
Cost of sales	(8,018)	(9,659)	(20,525)	(31,436)
Selling and administrative expenses	(25,489)	(32,517)	(47,801)	(73,912)
Impairments	(599)	(146,240)	(3,016)	(146,240)
Other operating income, net	18	259	18	249
Total operating expense	(34,088)	(188,157)	(71,324)	(251,339)
Operating loss	(9,203)	(153,056)	(18,120)	(181,035)
Nonoperating (expense) income:
Interest expense	(6,588)	(5,757)	(13,015)	(10,966)
Gain on extinguishment of debt	0	7,980	0	6,133
Fair value remeasurement gain	0	9,523	0	6,505
Other (expense) income, net	(245)	175	(295)	250
Total nonoperating (expense) income	(6,833)	11,921	(13,310)	1,922
Loss from continuing operations before income taxes	(16,036)	(141,135)	(31,430)	(179,113)
(Expense) benefit from income taxes	(616)	8,868	(1,669)	10,538
Net loss from continuing operations	(16,652)	(132,267)	(33,099)	(168,575)
Income (loss) from discontinued operations, net of tax	0	452	0	(920)
Net loss	(16,652)	(131,815)	(33,099)	(169,495)
Net loss attributable to PLBY Group, Inc.	$ (16,652)	$ (131,815)	$ (33,099)	$ (169,495)
Net loss per share from continuing operations, basic (in dollars per share)	$ (0.23)	$ (1.77)	$ (0.45)	$ (2.41)
Net loss per share from continuing operations, diluted (in dollars per share)	(0.23)	(1.77)	(0.45)	(2.41)
Net income (loss) per share from discontinued operations, basic (in dollars per share)	0	0.01	0	(0.01)
Net income (loss) per share from discontinued operations, diluted (in dollars per share)	0	0.01	0	(0.01)
Net loss per share, basic (in dollars per share)	(0.23)	(1.76)	(0.45)	(2.42)
Net loss per share, diluted (in dollars per share)	$ (0.23)	$ (1.76)	$ (0.45)	$ (2.42)
Weighted-average shares outstanding, basic (in shares)	73,040,566	74,916,379	72,859,533	70,129,055
Weighted-average shares outstanding, diluted (in shares)	73,040,566	74,916,379	72,859,533	70,129,055

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Statement of Comprehensive Income [Abstract]
Net loss	$ (16,652)	$ (131,815)	$ (33,099)	$ (169,495)
Other comprehensive loss:
Foreign currency translation adjustment	848	(272)	(885)	(1,968)
Other comprehensive income (loss)	848	(272)	(885)	(1,968)
Comprehensive loss	$ (15,804)	$ (132,087)	$ (33,984)	$ (171,463)

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 16,850	$ 28,120
Restricted cash	100	1,587
Receivables, net of allowance for credit losses	5,724	7,496
Inventories, net	10,355	13,000
Prepaid expenses and other current assets	7,104	7,802
Assets held for sale	7,325	11,692
Total current assets	47,458	69,697
Restricted cash	1,908	1,969
Property and equipment, net	10,943	13,514
Operating right-of-use assets	20,894	25,284
Goodwill	54,456	54,899
Other intangible assets, net	157,166	157,901
Contract assets, net of current portion	8,014	8,716
Other noncurrent assets	950	2,274
Total assets	301,789	334,254
Current liabilities:
Accounts payable	14,023	14,500
Deferred revenues, current portion	9,583	9,205
Long-term debt, current portion	304	304
Operating lease liabilities, current portion	6,438	6,955
Other current liabilities and accrued expenses	22,514	27,967
Total current liabilities	52,862	58,931
Deferred revenues, net of current portion	4,755	4,641
Long-term debt, net of current portion	195,948	190,115
Deferred tax liabilities, net	11,149	9,304
Operating lease liabilities, net of current portion	20,628	24,621
Other noncurrent liabilities	970	957
Total liabilities	286,312	288,569
Commitments and contingencies
Redeemable noncontrolling interest	(208)	(208)
Stockholders’ equity:
Preferred stock, $0.0001 par value per share, 5,000,000 shares authorized, 50,000 shares designated Series A preferred stock, of which 0 shares were issued and outstanding as of June 30, 2024 and December 31, 2023	0	0
Common stock, $0.0001 par value per share, 150,000,000 shares authorized, 75,503,774 shares issued and 73,253,845 shares outstanding as of June 30, 2024; 74,783,683 shares issued and 72,533,754 shares outstanding as of December 31, 2023	7	7
Treasury stock, at cost, 2,249,929 shares as of June 30, 2024 and December 31, 2023	(5,445)	(5,445)
Additional paid-in capital	693,894	690,055
Accumulated other comprehensive loss	(25,795)	(24,910)
Accumulated deficit	(646,976)	(613,814)
Total stockholders’ equity	15,685	45,893
Total liabilities, redeemable noncontrolling interest and stockholders’ equity	$ 301,789	$ 334,254

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock authorized (in shares)	5,000,000	5,000,000
Preferred stock, shares designated (in shares)	50,000	50,000
Preferred stock issued (in shares)	0
Preferred stock outstanding (in shares)	0
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock authorized (in shares)	150,000,000	150,000,000
Common stock issued (in shares)	75,503,774	74,783,683
Common stock outstanding (in shares)	73,253,845	72,533,754
Treasury stock (in shares)	2,249,929	2,249,929

Condensed Consolidated Statements of Stockholders’ Equity - USD ($) $ in Thousands	Total	Rights Offering	Private Placement	Series A Preferred Stock	Common Stock	Common Stock Rights Offering	Common Stock Private Placement	Treasury Stock	Additional Paid-in Capital	Additional Paid-in Capital Rights Offering	Additional Paid-in Capital Private Placement	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit
Shares outstanding at beginning of period (in shares) at Dec. 31, 2022				50,000	47,037,699
Stockholders' equity at beginning of period at Dec. 31, 2022	$ 155,252				$ 5			$ (4,445)	$ 617,233			$ (24,145)	$ (433,396)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock (in shares)						19,561,050	6,357,341
Issuance of common stock		$ 47,602	$ 13,890			$ 2				$ 47,600	$ 13,890
Exchange of mandatorily redeemable preferred shares (in shares)				(50,000)
Shares issued in connection with equity incentive plans (in shares)					837,848
Shares issued pursuant to a license, services and collaboration agreement (in shares)					3,312
Stock-based compensation expense and vesting of restricted stock units	9,557								9,557
Other comprehensive income (loss)	(1,968)											(1,968)
Net loss	(169,495)												(169,495)
Shares outstanding at end of period (in shares) at Jun. 30, 2023				0	73,797,250
Total stockholders' equity at end of period at Jun. 30, 2023	54,838				$ 7			(4,445)	688,280			(26,113)	(602,891)
Shares outstanding at beginning of period (in shares) at Mar. 31, 2023				50,000	73,174,547
Stockholders' equity at beginning of period at Mar. 31, 2023	183,288				$ 7			(4,445)	684,643			(25,841)	(471,076)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exchange of mandatorily redeemable preferred shares (in shares)				(50,000)
Shares issued in connection with equity incentive plans (in shares)					622,703
Stock-based compensation expense and vesting of restricted stock units	3,637								3,637
Other comprehensive income (loss)	(272)											(272)
Net loss	(131,815)												(131,815)
Shares outstanding at end of period (in shares) at Jun. 30, 2023				0	73,797,250
Total stockholders' equity at end of period at Jun. 30, 2023	54,838				$ 7			(4,445)	688,280			(26,113)	(602,891)
Shares outstanding at beginning of period (in shares) at Dec. 31, 2023				0	72,533,754
Stockholders' equity at beginning of period at Dec. 31, 2023	45,893				$ 7			(5,445)	690,055			(24,910)	(613,814)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Shares issued in connection with equity incentive plans (in shares)					720,091
Stock-based compensation expense and vesting of restricted stock units	3,839								3,839
Other	(63)												(63)
Other comprehensive income (loss)	(885)											(885)
Net loss	(33,099)												(33,099)
Shares outstanding at end of period (in shares) at Jun. 30, 2024				0	73,253,845
Total stockholders' equity at end of period at Jun. 30, 2024	15,685				$ 7			(5,445)	693,894			(25,795)	(646,976)
Shares outstanding at beginning of period (in shares) at Mar. 31, 2024				0	72,643,445
Stockholders' equity at beginning of period at Mar. 31, 2024	29,547				$ 7			(5,445)	691,889			(26,643)	(630,261)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Shares issued in connection with equity incentive plans (in shares)					610,400
Stock-based compensation expense and vesting of restricted stock units	2,005								2,005
Other	(63)												(63)
Other comprehensive income (loss)	848											848
Net loss	(16,652)												(16,652)
Shares outstanding at end of period (in shares) at Jun. 30, 2024				0	73,253,845
Total stockholders' equity at end of period at Jun. 30, 2024	$ 15,685				$ 7			$ (5,445)	$ 693,894			$ (25,795)	$ (646,976)

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Cash Flows From Operating Activities
Net loss	$ (33,099)	$ (169,495)
Net loss from continuing operations	(33,099)	(168,575)
Income (loss) from discontinued operations, net of tax	0	(920)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	4,311	3,537
Stock-based compensation	3,839	8,370
Fair value measurement of liabilities	(56)	(6,772)
Gain on extinguishment of debt	0	(6,133)
Impairments	3,016	146,240
Inventory reserve charges	(852)	5,860
Amortization of right-of-use assets	4,271	1,676
Capitalized paid-in-kind interest	3,703	0
Amortization of debt issuance costs	2,212	1,183
Deferred income taxes	1,833	(9,841)
Other	509	(90)
Changes in operating assets and liabilities:
Receivables, net	1,781	(3,062)
Inventories	4,282	4,949
Contract assets	129	(14,947)
Prepaid expenses and other assets	921	2,353
Accounts payable	(296)	(1,341)
Deferred revenues	521	14,440
Operating lease liabilities	(4,971)	(1,795)
Other	(4,834)	(2,705)
Net cash used in operating activities from continuing operations	(12,780)	(26,653)
Net cash provided by operating activities from discontinued operations	0	30
Net cash used in operating activities	(12,780)	(26,623)
Cash Flows From Investing Activities
Purchases of property and equipment	(1,244)	(752)
Proceeds from sale of artwork	1,572	0
Proceeds from sale of Yandy	0	1,000
Net cash provided by investing activities - continuing operations	328	248
Net cash used in investing activities - discontinued operations	0	(68)
Net cash provided by investing activities	328	180
Cash Flows From Financing Activities
Proceeds from issuance of common stock in rights offering, net	0	47,600
Proceeds from issuance of common stock in registered direct offering, net	0	13,890
Proceeds from issuance of long-term debt	0	11,828
Repayment of long-term debt	(152)	(45,476)
Payment of financing costs	0	(508)
Other	(63)	0
Net cash (used in) provided by financing activities - continuing operations	(215)	27,334
Effect of exchange rate changes on cash and cash equivalents	(151)	19
Net (decrease) increase in cash and cash equivalents and restricted cash	(12,818)	910
Balance, beginning of year	31,676	35,449
Balance, end of period	18,858	36,359
Cash and cash equivalents and restricted cash consist of:
Cash and cash equivalents	16,850	34,404
Restricted cash	2,008	1,955
Total	18,858	36,359
Supplemental Disclosures
Cash paid (refunded) for income taxes	717	(749)
Cash paid for interest	6,981	8,853
Supplemental Disclosure of Non-Cash Activities
Right-of-use assets in exchange for lease liabilities - continuing operations	600	2,400
Right-of-use assets in exchange for lease liabilities - discontinued operations	0	885
Shares issued pursuant to a license, services and collaboration agreement	$ 0	$ 236

Basis of Presentation and Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2024

Accounting Policies [Abstract]

Basis of Presentation and Summary of Significant Accounting Policies

Description of Business

We have three reportable segments: Direct-to-Consumer, Licensing, and Digital Subscriptions and Content. Refer to Note 15, Segments.

Basis of Presentation

The interim condensed consolidated financial statements and accompanying notes were prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).

Principles of Consolidation

The interim condensed consolidated financial statements include our accounts and all majority-owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation.

The Company follows a monthly reporting calendar, with its fiscal year ending on December 31.

Unaudited Interim Condensed Consolidated Financial Statements

Reclassifications

Certain prior period amounts in the condensed consolidated statements of operations and condensed consolidated balance sheets have been reclassified to conform with the current period presentation.

Use of Estimates

Concentrations of Business and Credit Risk

There were no receivables from our customers exceeding 10% of our total as of June 30, 2024 and December 31, 2023.

The following table represents revenue from our customers exceeding 10% of our total revenue, excluding revenues from discontinued operations:


	Three Months Ended June 30,			Six Months Ended June 30,
Customer	2024	2023		2024	2023
Customer A(1)	*	15	%	*	15	%
_________________ (1) The agreement with this licensee was terminated in the fourth quarter of 2023. *Indicates revenues for the customer did not exceed 10% of our total for the three and six months ended June 30, 2024.

Restricted Cash

Liquidity Assessment and Management’s Plans

Advertising Costs

Long-Lived Assets, Indefinite-lived Intangible Assets and Goodwill

Gift Card Liabilities

Comprehensive Loss

Recently Adopted Accounting Pronouncements

There were no recently adopted accounting pronouncements applicable to the Company for the quarter ended June 30, 2024.

Accounting Pronouncements Issued but Not Yet Adopted

Fair Value Measurements

6 Months Ended

Jun. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

Level 1 inputs: Based on unadjusted quoted prices in active markets for identical assets or liabilities.

Liabilities Measured and Recorded at Fair Value on a Recurring Basis

The following table summarizes the fair value of our financial liabilities measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands):


	June 30, 2024
	Level 1		Level 2		Level 3		Total
Liabilities
Contingent consideration liability	$	—	$	—	$	(343)	$	(343)


	December 31, 2023
	Level 1		Level 2		Level 3		Total
Liabilities
Contingent consideration liability	$	—	$	—	$	(399)	$	(399)

There were no transfers of financial instruments between Level 1, Level 2, and Level 3 during the periods presented.

The following table provides a roll-forward of the fair value of the liabilities categorized as Level 3 for the six months ended June 30, 2024 (in thousands):


	Contingent Consideration
Balance at December 31, 2023	$	399
Change in fair value	(56)
Balance at June 30, 2024	$	343

The decrease in the fair value of the contingent consideration for the six months ended June 30, 2024 was primarily due to a decrease in a price per share of our common stock.

Assets Held for Sale

Assets Measured and Recorded at Fair Value on a Non-recurring Basis

Revenue Recognition

6 Months Ended

Jun. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Contract Balances


	June 30, 2024		December 31, 2023		December 31, 2022
Accounts receivable	$	5,724	$	7,496	$	14,214
Contract Balances:
Contract assets, current portion	$	2,120	$	1,547	$	2,559
Contract assets, net of current portion	8,014		8,716		13,680
Contract liabilities, current portion	(9,583)		(9,205)		(10,480)
Contract liabilities, net of current portion	(4,755)		(4,641)		(21,406)
Contract liabilities, net	$	(4,204)	$	(3,583)	$	(15,647)

The following tables provide a roll-forward of our netted contract assets and contract liabilities from continuing operations (in thousands):


	Contract Liabilities, Net
Balance at December 31, 2023	$	(3,583)
Revenues recognized that were included in gross contract liabilities at December 31, 2023	13,195
Contract assets reclassified to accounts receivable in the six months ended June 30, 2024	(11,882)
Cash received in advance since prior year and remains in net contract liabilities at period-end	(1,934)
Balance at June 30, 2024	$	(4,204)


	Contract Liabilities, Net
Balance at December 31, 2022	$	(15,647)
Revenues recognized that were included in gross contract liabilities at December 31, 2022	22,065
Contract assets reclassified to accounts receivable in the six months ended June 30, 2023	(22,529)
Cash received in advance since prior year and remained in net contract liabilities at period-end	(2,356)
Write-down of contract liabilities due to impairment of a trademark licensing agreement	3,150
Contract impairments, modifications and terminations in 2023	(5,834)
Balance at June 30, 2023	$	(21,151)

Future Performance Obligations

Disaggregation of Revenue

The following table disaggregates revenue by type (in thousands):


	Three Months Ended June 30, 2024										Six Months Ended June 30, 2024
	Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total		Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total
Trademark licensing	$	5,272	$	—	$	—	$	—	$	5,272	$	9,357	$	—	$	—	$	—	$	9,357
Digital subscriptions and products	—		—		3,479		—		3,479		—		—		7,283		—		7,283
TV and cable programming	—		—		1,630		—		1,630		—		—		3,320		—		3,320
Consumer products	—		14,504		—		—		14,504		—		33,244		—		—		33,244
Total revenues	$	5,272	$	14,504	$	5,109	$	—	$	24,885	$	9,357	$	33,244	$	10,603	$	—	$	53,204


	Three Months Ended June 30, 2023										Six Months Ended June 30, 2023
	Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total		Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total
Trademark licensing	$	10,288	$	—	$	—	$	—	$	10,288	$	19,982	$	—	$	—	$	—	$	19,982
Digital subscriptions and products	—		—		3,097		1		3,098		—		—		5,786		4		5,790
TV and cable programming	—		—		2,015		—		2,015		—		—		4,064		—		4,064
Consumer products	—		19,700		—		—		19,700		—		40,468		—		—		40,468
Total revenues	$	10,288	$	19,700	$	5,112	$	1	$	35,101	$	19,982	$	40,468	$	9,850	$	4	$	70,304

The following table disaggregates revenue by point in time versus over time (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Point in time	$	15,837	$	20,801	$	36,125	$	42,144
Over time	9,048		14,300		17,079		28,160
Total revenues	$	24,885	$	35,101	$	53,204	$	70,304

Inventories, Net

6 Months Ended

Jun. 30, 2024

Inventory Disclosure [Abstract]

Inventories, Net

The following table sets forth inventories, net, which are stated at the lower of cost (specific cost and first-in, first-out) and net realizable value (in thousands):


	June 30, 2024		December 31, 2023
Editorial and other pre-publication costs	$	107	$	242
Merchandise finished goods	10,248		12,758
Total	$	10,355	$	13,000

At June 30, 2024 and December 31, 2023, reserves for slow-moving and obsolete inventory amounted to $4.6 million and $5.5 million, respectively.

Prepaid Expenses and Other Current Assets

6 Months Ended

Jun. 30, 2024

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):


	June 30, 2024		December 31, 2023
Contract assets, current portion	$	2,120	$	1,547
Prepaid inventory not yet received	2,031		703
Prepaid software	832		1,488
Prepaid insurance	305		858
Promissory note receivable	142		1,632
Other	1,674		1,574
Total	$	7,104	$	7,802

Property and Equipment, Net

6 Months Ended

Jun. 30, 2024

Property, Plant and Equipment [Abstract]

Property and Equipment, Net

Property and equipment, net consisted of the following (in thousands):


	June 30, 2024		December 31, 2023
Internally developed software	$	11,643	$	10,812
Leasehold improvements	9,987		10,682
Equipment	3,715		3,747
Furniture and fixtures	1,762		1,932
Construction in progress	699		692
Total property and equipment, gross	27,806		27,865
Less: accumulated depreciation	(16,863)		(14,351)
Total	$	10,943	$	13,514

Other Current Liabilities and Accrued Expenses

6 Months Ended

Jun. 30, 2024

Payables and Accruals [Abstract]

Other Current Liabilities and Accrued Expenses

Other current liabilities and accrued expenses consisted of the following (in thousands):


	June 30, 2024		December 31, 2023
Taxes	$	6,923	$	8,479
Accrued interest	3,069		3,040
Accrued salaries, wages and employee benefits	2,314		4,157
Accrued creator fees	1,951		2,113
Outstanding gift cards and store credits	1,707		1,618
Other	6,550		8,560
Total	$	22,514	$	27,967

Debt

6 Months Ended

Jun. 30, 2024

Debt Disclosure [Abstract]

Debt

The following table sets forth our debt (in thousands):


	June 30, 2024		December 31, 2023
Term loan, due 2027	$	209,621	$	209,772
Plus: capitalized payment-in-kind interest	5,551		1,848
Total debt	215,172		211,620
Less: unamortized debt issuance costs	(536)		(582)
Less: unamortized debt discount	(18,384)		(20,619)
Total debt, net of unamortized debt issuance costs and debt discount	196,252		190,419
Less: current portion of long-term debt	(304)		(304)
Total debt, net of current portion	$	195,948	$	190,115

In July 2023, DBD Credit Funding LLC, an affiliate of Fortress, became the administrative agent and collateral agent under the A&R Credit Agreement.

On March 27, 2024, we entered into Amendment No. 2 to the A&R Credit Agreement (the “A&R Second Amendment”), which provided for, among other things:

The other terms of the A&R Credit Agreement prior to the A&R Second Amendment remained substantially unchanged.

We were in compliance with applicable financial covenants under the terms of the A&R Credit Agreement and its amendments as of June 30, 2024 and December 31, 2023.

The following table sets forth maturities of the principal amount of our A&R Term Loans as of June 30, 2024 (in thousands):


Remainder of 2024	$	152
2025	304
2026	304
2027	214,412
Total	$	215,172

Stockholders’ Equity

6 Months Ended

Jun. 30, 2024

Equity [Abstract]

Stockholders’ Equity

Common Stock

Common stock reserved for future issuance consisted of the following:


	June 30, 2024	December 31, 2023
Shares available for grant under equity incentive plans	3,687,252	739,178
Options issued and outstanding under equity incentive plans	1,997,466	2,291,328
Unvested restricted stock units	1,604,235	3,214,910
Vested equity awards not yet settled	1,196,828	14,994
Unvested performance-based restricted stock units	389,827	707,655
Maximum number of shares issuable to GlowUp sellers pursuant to acquisition indemnity holdback	249,116	249,116
Total common stock reserved for future issuance	9,124,724	7,217,181

Stock-Based Compensation

6 Months Ended

Jun. 30, 2024

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

Stock Option Activity

A summary of the stock option activity under our equity incentive plans is as follows:


	Number of Options	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (in thousands)
Balance – December 31, 2023	2,291,328	$	2.49	6.4	$	311
Granted	—	—		—	—
Exercised	—	—		—	—
Forfeited, expired and cancelled	(293,862)	5.05		—	—
Balance – June 30, 2024	1,997,466	$	2.12	6.8	$	107
Exercisable – June 30, 2024	1,540,180	$	2.55	6.1	$	54
Vested and expected to vest as of June 30, 2024	1,997,466	$	2.12	6.8	$	107

There were no options granted during the three or six months ended June 30, 2024 or 2023. There were no options forfeited, expired or cancelled during the three months ended June 30, 2024.

Restricted Stock Units

A summary of restricted stock unit activity under our equity incentive plans is as follows:


	Number of Awards	Weighted- Average Grant Date Fair Value per Share
Unvested and outstanding balance at December 31, 2023	3,214,910	$	2.91
Granted	—	—
Vested	(1,584,097)	3.08
Forfeited	(26,578)	3.11
Unvested and outstanding balance at June 30, 2024	1,604,235	$	2.74

A summary of performance-based restricted stock unit (“PSU”) activity under our 2021 Plan is as follows:


	Number of awards	Weighted- average grant date fair value per share
Unvested and outstanding balance at December 31, 2023	707,655	$	10.8
Granted	—	—
Vested (1)	(317,828)	16.93
Forfeited	—	—
Unvested and outstanding balance at June 30, 2024	389,827	$	5.80

(1) Relates to PSUs that were modified in the fourth quarter of 2023 to change the unvested shares underlying the original awards to time-based vesting.

Stock-Based Compensation Expense

Stock-based compensation expense under our equity incentive plans was as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Cost of sales (1)	$	—	$	(826)	$	633	$	(453)
Selling and administrative expenses (2)	2,005		3,977		3,206		8,823
Total	$	2,005	$	3,151	$	3,839	$	8,370

Commitments and Contingencies

6 Months Ended

Jun. 30, 2024

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Leases

Net lease cost recognized in our unaudited condensed consolidated statements of operations for the three and six months ended June 30, 2024 and 2023 is summarized in the table below (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Operating lease cost	$	2,105	$	1,928	$	4,190	$	3,819
Variable lease cost	266		343		640		745
Short-term lease cost	445		581		848		1,291
Sublease income	(232)		(196)		(454)		(265)
Total	$	2,584	$	2,656	$	5,224	$	5,590

Maturities of our operating lease liabilities as of June 30, 2024 were as follows (in thousands):


Remainder of 2024	$	4,129
2025	7,900
2026	7,314
2027	4,832
2028	2,458
Thereafter	5,773
Total undiscounted lease payments	32,406
Less: imputed interest	(5,340)
Total operating lease liabilities	$	27,066

Operating lease liabilities, current portion	$	6,438
Operating lease liabilities, noncurrent portion	$	20,628

Legal Contingencies

TNR Case

AVS Case

New Handong Arbitration

Former Model Case

Severance Costs

6 Months Ended

Jun. 30, 2024

Restructuring and Related Activities [Abstract]

Severance Costs

Severance costs in our condensed consolidated statements of operations were as follows (in thousands):


	Three Months Ended June 30, 2023		Six Months Ended June 30, 2023
Direct-to-Consumer	$	756	$	1,127
Licensing	36		53
Digital Subscriptions and Content	—		39
Corporate	10		1,221
Total	$	802	$	2,440


	Employee Separation Costs
Balance at December 31, 2023	$	1,184
Costs incurred and charged to expense	169
Costs paid or otherwise settled	(1,157)
Balance at June 30, 2024	$	196

Income Taxes	6 Months Ended
Income Taxes	Jun. 30, 2024
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The effective tax rate for the three months ended June 30, 2024 and 2023 was (3.8)% and 6.3%, respectively. The effective tax rate for the six months ended June 30, 2024 and 2023 was (5.3)% and 5.9%, respectively. The effective tax rate for the three and six months ended June 30, 2024 differed from the U.S. statutory federal income tax rate of 21% primarily due to impairment charges on artwork held for sale, foreign withholding taxes and the release of valuation allowance due to a reduction in net deferred tax liabilities of indefinite lived intangibles. The effective tax rate for the three and six months ended June 30, 2023 differed from the U.S. statutory federal income tax rate of 21% primarily due to foreign withholding taxes, the limitations of Internal Revenue Code Section Section 162(m), stock compensation shortfall deductions and the release of valuation allowance due to a reduction in net deferred tax liabilities of indefinite lived intangibles. During the second quarter of 2024, the Company decided to revoke its permanent reinvestment assertion on certain foreign jurisdictions and repatriated total earnings from foreign subsidiaries of $2.7 million to the United States. Due to the Company’s overall losses incurred and the dividends received deduction in the United States, such repatriation did not have any material impact on the Company’s tax provision for the quarter ended June 30, 2024.

Net Loss Per Share

6 Months Ended

Jun. 30, 2024

Earnings Per Share [Abstract]

Net Loss Per Share

The following outstanding potentially dilutive shares have been excluded from the calculation of diluted net loss per share due to their anti-dilutive effect:


	Three Months Ended June 30,		Six Months Ended June 30,
	2024	2023	2024	2023
Options issued and outstanding under equity incentive plans	1,997,466	2,496,494	1,997,466	2,496,494
Unvested restricted stock units	1,604,235	1,066,281	1,604,235	1,066,281
Unvested performance-based restricted stock units	389,827	1,089,045	389,827	1,089,045
Total	3,991,528	4,651,820	3,991,528	4,651,820

Segments

6 Months Ended

Jun. 30, 2024

Segment Reporting [Abstract]

Segments

The following table sets forth financial information by reportable segment (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net revenues:
Direct-to-Consumer	$	14,504	$	19,700	$	33,244	$	40,468
Licensing	5,272		10,288		9,357		19,982
Digital Subscriptions and Content	5,109		5,112		10,603		9,850
All Other	—		1		—		4
Total	$	24,885	$	35,101	$	53,204	$	70,304
Operating (loss) income:
Direct-to-Consumer	$	(2,365)	$	(75,002)	$	(1,483)	$	(90,058)
Licensing	4,323		(65,131)		6,340		(61,564)
Digital Subscriptions and Content	(2,215)		1,002		(2,314)		393
Corporate	(8,948)		(13,918)		(20,675)		(29,794)
All Other	2		(7)		12		(12)
Total	$	(9,203)	$	(153,056)	$	(18,120)	$	(181,035)

Geographic Information

Revenue by geography is based on where the customer is located. The following table sets forth revenue by geographic area (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net revenues:
United States	$	11,470	$	14,975	$	25,630	$	30,634
Australia	6,689		7,608		14,823		15,136
China	3,024		7,475		4,470		14,423
UK	2,044		2,943		4,744		5,445
Other	1,658		2,100		3,537		4,666
Total	$	24,885	$	35,101	$	53,204	$	70,304

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Pay vs Performance Disclosure
Net loss	$ (16,652)	$ (131,815)	$ (33,099)	$ (169,495)

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Jun. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Basis of Presentation and Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
Basis of Presentation and Unaudited Interim Condensed Consolidated Financial Statements	Basis of Presentation The interim condensed consolidated financial statements and accompanying notes were prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The Yandy Enterprises LLC (“Yandy”) and TLA Acquisition Corp. (“TLA”, owner of the Lovers business) disposal groups, previously included in the Direct-to-Consumer segment in the prior year comparative period, were classified as discontinued operations in the condensed consolidated statements of operations for the prior year comparative period presented. The sale of Yandy was completed on April 4, 2023 (the “Yandy Sale”). The sale of TLA was completed on November 3, 2023 (the “TLA Sale”). Unaudited Interim Condensed Consolidated Financial Statements The interim condensed consolidated balance sheet as of June 30, 2024, and the interim condensed consolidated statements of operations, comprehensive loss, cash flows, and stockholders’ equity for the three and six months ended June 30, 2024 and 2023 are unaudited. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and reflect, in the opinion of management, all adjustments of a normal and recurring nature that are necessary for the fair statement of our financial position as of June 30, 2024 and our results of operations and cash flows for the three and six months ended June 30, 2024 and 2023. The financial data and other financial information disclosed in these notes to the interim condensed consolidated financial statements related to the three and six-month periods are also unaudited. The interim condensed consolidated results of operations for the six months ended June 30, 2024 are not necessarily indicative of the results to be expected for the year ending December 31, 2024 or for any future annual or interim period. The interim condensed consolidated balance sheet as of December 31, 2023 included herein was derived from the audited financial statements as of that date. These interim condensed consolidated financial statements should be read in conjunction with our audited financial statements included in the Annual Report on Form 10-K as filed by us with the U.S. Securities and Exchange Commission (the “SEC”) on March 29, 2024.
Principles of Consolidation	Principles of Consolidation The interim condensed consolidated financial statements include our accounts and all majority-owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. The Company follows a monthly reporting calendar, with its fiscal year ending on December 31.
Reclassifications	Reclassifications Certain prior period amounts in the condensed consolidated statements of operations and condensed consolidated balance sheets have been reclassified to conform with the current period presentation.
Use of Estimates	Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. We regularly assess these estimates, including, but not limited to, valuation of our trademarks and trade names; valuation of our contingent consideration liabilities; valuation of our only authorized and issued preferred stock (our “Series A Preferred Stock”), with the previously outstanding Series A Preferred Stock having been exchanged for debt and thereby eliminated in May 2023 upon amendment and restatement of our senior secured debt; pay-per-view and video-on-demand buys, and monthly subscriptions to our television and digital content; the adequacy of reserves associated with accounts receivable and inventory; unredeemed gift cards and store credits; licensing commission accruals; and stock-based compensation expense. We base these estimates on historical experience and on various other market-specific and relevant assumptions that we believe to be reasonable under the circumstances. Actual results could differ from these estimates and such differences could be material to the financial position and results of operations.
Concentrations of Business and Credit Risk	Concentrations of Business and Credit Risk We maintain certain cash balances in excess of Federal Deposit Insurance Corporation insured limits. We periodically evaluate the credit worthiness of the financial institutions with which we maintain cash deposits. We have not experienced any losses in such accounts and do not believe that there is any credit risk to our cash. Concentration of credit risk with respect to accounts receivable is limited due to the wide variety of customers to whom our products are sold and/or licensed.
Restricted Cash	Restricted Cash At June 30, 2024 and December 31, 2023, restricted cash was primarily related to a cash collateralized letter of credit we maintained in connection with the lease of our Los Angeles headquarters and Honey Birdette’s term deposit in relation to its Sydney office lease. The December 31, 2023 restricted cash balance also included cash held in escrow related to the TLA Sale, which had been released to us in full as of June 30, 2024.
Advertising Costs	Advertising Costs We expense advertising costs as incurred. Advertising expenses were $1.1 million and $1.4 million for the three months ended June 30, 2024 and 2023, respectively, excluding $0.3 million of advertising costs related to discontinued operations for the three months ended June 30, 2023. Advertising expenses for the six months ended June 30, 2024 and 2023 were $2.1 million and $3.7 million, respectively, excluding $2.3 million of advertising costs related to discontinued operations for the six months ended June 30, 2023. We also have various arrangements with collaborators pursuant to which we reimburse them for a portion of their advertising costs in the form of co-op marketing which provide advertising benefits to us. The costs that we incur for such advertising costs are recorded as a reduction of revenue.
Long-Lived Assets	Long-Lived Assets, Indefinite-lived Intangible Assets and Goodwill The carrying amounts of long-lived assets, including property and equipment, stores, acquired intangible assets and right-of-use operating lease assets are periodically reviewed for indicators of impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable or that the useful life is shorter than originally estimated. We recognized $0.6 million of impairment charges on right-of-use assets pertaining to our corporate leases during the three months ended June 30, 2024. In the second quarter of 2024, we had impairment indicators to our direct-to-consumer business, causing us to perform a quantitative impairment test for our indefinite-lived and amortizable intangibles, including goodwill, as of June 30, 2024. The quantitative impairment test for indefinite-lived and amortizable intangibles, including goodwill, indicated that their carrying values were less than the fair values, therefore, there were no impairment charges to be recognized on our intangibles, including goodwill during the three and six months ended June 30, 2024. We recognized $5.1 million of impairment charges on our trade names at the impairment date in the second quarter of 2023. Indefinite-lived intangible assets that are not amortized but subject to annual impairment testing consist of Playboy-branded trademarks. Our indefinite-lived Playboy-branded trademarks are periodically reviewed for indicators of impairment whenever events or changes in circumstances indicate that the value of these assets may not be recoverable or that the useful life is shorter than originally estimated. We evaluate the indefinite-lived Playboy-branded trademarks for impairment using the discounted cash flow and relief from royalty method. This valuation approach requires that we make a number of assumptions to estimate fair value, including projections of future revenues, market royalty rates, tax rates, discount rates and other relevant variables. The projections we use in the model are updated annually or more frequently if an impairment triggering event has been identified and will change over time based on the historical performance and changing business conditions. If the carrying value of the trademark exceeds its estimated fair value, an impairment charge is recognized for the excess amount. There were no impairment charges to Playboy-branded trademarks to be recognized during the three and six months ended June 30, 2024. In the second quarter of 2023, we experienced declines in revenue and profitability, causing us to test the recoverability of our indefinite-lived assets as of June 30, 2023. The impairment charges on the indefinite-lived Playboy-branded trademarks were $65.5 million as of the impairment date in the second quarter of 2023. We perform annual impairment testing on goodwill in the fourth quarter of each fiscal year or when events occur or circumstances change that would, more likely than not, reduce the fair value of a reporting unit below its carrying value. We may first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If we determine it is more likely than not that the fair value of the reporting unit is greater than its carrying amount, an impairment test is unnecessary. If an impairment test is necessary, we will estimate the fair value of a related reporting unit. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is determined to be impaired, and we will proceed with recording an impairment charge equal to the excess of the carrying value over the related fair value. If we determine it is more likely than not that goodwill is not impaired, a quantitative test is not necessary. There were no impairment charges to goodwill to be recognized during the three and six months ended June 30, 2024. In the second quarter of 2023, we experienced declines in revenue and profitability, causing us to test our goodwill for impairment as of June 30, 2023. Utilizing the income approach, we performed a quantitative impairment test on goodwill using a discounted cash flow analysis, which determined that the carrying value of certain of our reporting units exceeded their fair value. As a result, we recognized $66.7 million of impairment charges on our goodwill at the impairment date in the second quarter of 2023.
Indefinite-lived Intangible Assets and Goodwill	Long-Lived Assets, Indefinite-lived Intangible Assets and Goodwill The carrying amounts of long-lived assets, including property and equipment, stores, acquired intangible assets and right-of-use operating lease assets are periodically reviewed for indicators of impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable or that the useful life is shorter than originally estimated. We recognized $0.6 million of impairment charges on right-of-use assets pertaining to our corporate leases during the three months ended June 30, 2024. In the second quarter of 2024, we had impairment indicators to our direct-to-consumer business, causing us to perform a quantitative impairment test for our indefinite-lived and amortizable intangibles, including goodwill, as of June 30, 2024. The quantitative impairment test for indefinite-lived and amortizable intangibles, including goodwill, indicated that their carrying values were less than the fair values, therefore, there were no impairment charges to be recognized on our intangibles, including goodwill during the three and six months ended June 30, 2024. We recognized $5.1 million of impairment charges on our trade names at the impairment date in the second quarter of 2023. Indefinite-lived intangible assets that are not amortized but subject to annual impairment testing consist of Playboy-branded trademarks. Our indefinite-lived Playboy-branded trademarks are periodically reviewed for indicators of impairment whenever events or changes in circumstances indicate that the value of these assets may not be recoverable or that the useful life is shorter than originally estimated. We evaluate the indefinite-lived Playboy-branded trademarks for impairment using the discounted cash flow and relief from royalty method. This valuation approach requires that we make a number of assumptions to estimate fair value, including projections of future revenues, market royalty rates, tax rates, discount rates and other relevant variables. The projections we use in the model are updated annually or more frequently if an impairment triggering event has been identified and will change over time based on the historical performance and changing business conditions. If the carrying value of the trademark exceeds its estimated fair value, an impairment charge is recognized for the excess amount. There were no impairment charges to Playboy-branded trademarks to be recognized during the three and six months ended June 30, 2024. In the second quarter of 2023, we experienced declines in revenue and profitability, causing us to test the recoverability of our indefinite-lived assets as of June 30, 2023. The impairment charges on the indefinite-lived Playboy-branded trademarks were $65.5 million as of the impairment date in the second quarter of 2023. We perform annual impairment testing on goodwill in the fourth quarter of each fiscal year or when events occur or circumstances change that would, more likely than not, reduce the fair value of a reporting unit below its carrying value. We may first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If we determine it is more likely than not that the fair value of the reporting unit is greater than its carrying amount, an impairment test is unnecessary. If an impairment test is necessary, we will estimate the fair value of a related reporting unit. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is determined to be impaired, and we will proceed with recording an impairment charge equal to the excess of the carrying value over the related fair value. If we determine it is more likely than not that goodwill is not impaired, a quantitative test is not necessary. There were no impairment charges to goodwill to be recognized during the three and six months ended June 30, 2024. In the second quarter of 2023, we experienced declines in revenue and profitability, causing us to test our goodwill for impairment as of June 30, 2023. Utilizing the income approach, we performed a quantitative impairment test on goodwill using a discounted cash flow analysis, which determined that the carrying value of certain of our reporting units exceeded their fair value. As a result, we recognized $66.7 million of impairment charges on our goodwill at the impairment date in the second quarter of 2023.
Gift Card Liabilities	Gift Card Liabilities We account for gift cards sold to customers by recording a liability in other current liabilities and accrued expenses in our consolidated balance sheets at the time of sale, which is recognized as revenue when redeemed or when we have determined the likelihood of redemption to be remote, which is referred to as gift card breakage. Depending on the jurisdiction in which we operate, gift cards sold to customers have expiration dates ranging from three to five years from the date of sale, or they do not expire and may be subject to escheatment rights.
Comprehensive Loss	Comprehensive Loss Comprehensive loss consists of net loss and other gains and losses affecting stockholders’ equity that, under GAAP, are excluded from net loss. Our other comprehensive income (loss) represents foreign currency translation adjustments attributable to Honey Birdette’s operations. Refer to the Condensed Consolidated Statements of Comprehensive Loss. Total foreign currency transaction gains and losses were immaterial for the three and six months ended June 30, 2024 and 2023.
Recently Adopted Accounting Pronouncements and Accounting Pronouncements Issued but Not Yet Adopted	Recently Adopted Accounting Pronouncements There were no recently adopted accounting pronouncements applicable to the Company for the quarter ended June 30, 2024. Accounting Pronouncements Issued but Not Yet Adopted In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. All disclosure requirements under ASU 2023-07 are also required for public entities with a single reportable segment. The ASU’s amendments are effective for all public entities for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the impact of this pronouncement on our disclosures. In December 2023, the FASB issued ASU 2023-08, Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets, which addresses the accounting and disclosure requirements for certain crypto assets. This ASU requires entities to subsequently measure certain crypto assets at fair value, with changes in fair value recorded in net income in each reporting period. In addition, entities are required to provide additional disclosures about the holdings of certain crypto assets. The ASU’s amendments are effective for all entities holding assets that meet certain scope criteria for fiscal years beginning after December 15, 2024, including interim periods within those years. Early adoption is permitted for both interim and annual periods. If an entity adopts the amendments in an interim period, it must adopt them as of the beginning of the fiscal year that includes that interim period. We do not expect this pronouncement to have a material impact on our financial statements, and are currently evaluating its impact on our disclosures and consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. Under this ASU, public entities must annually (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than five percent of the amount computed by multiplying pretax income or loss by the applicable statutory income tax rate). This ASU’s amendments are effective for all entities that are subject to Topic 740, Income Taxes, for annual periods beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the impact of this pronouncement on our disclosures.

Basis of Presentation and Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2024

Accounting Policies [Abstract]

Schedules of Concentration of Risks

The following table represents revenue from our customers exceeding 10% of our total revenue, excluding revenues from discontinued operations:


	Three Months Ended June 30,			Six Months Ended June 30,
Customer	2024	2023		2024	2023
Customer A(1)	*	15	%	*	15	%
_________________ (1) The agreement with this licensee was terminated in the fourth quarter of 2023. *Indicates revenues for the customer did not exceed 10% of our total for the three and six months ended June 30, 2024.

Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2024

Fair Value Disclosures [Abstract]

Schedule of Fair Value of Financial Liabilities Measured on Recurring Basis

The following table summarizes the fair value of our financial liabilities measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands):


	June 30, 2024
	Level 1		Level 2		Level 3		Total
Liabilities
Contingent consideration liability	$	—	$	—	$	(343)	$	(343)


	December 31, 2023
	Level 1		Level 2		Level 3		Total
Liabilities
Contingent consideration liability	$	—	$	—	$	(399)	$	(399)

Schedule of Fair Value Liabilities Activity

The following table provides a roll-forward of the fair value of the liabilities categorized as Level 3 for the six months ended June 30, 2024 (in thousands):


	Contingent Consideration
Balance at December 31, 2023	$	399
Change in fair value	(56)
Balance at June 30, 2024	$	343

Revenue Recognition (Tables)

6 Months Ended

Jun. 30, 2024

Revenue from Contract with Customer [Abstract]

Contract with Customer, Contract Asset, Contract Liability, and Receivable


	June 30, 2024		December 31, 2023		December 31, 2022
Accounts receivable	$	5,724	$	7,496	$	14,214
Contract Balances:
Contract assets, current portion	$	2,120	$	1,547	$	2,559
Contract assets, net of current portion	8,014		8,716		13,680
Contract liabilities, current portion	(9,583)		(9,205)		(10,480)
Contract liabilities, net of current portion	(4,755)		(4,641)		(21,406)
Contract liabilities, net	$	(4,204)	$	(3,583)	$	(15,647)

The following tables provide a roll-forward of our netted contract assets and contract liabilities from continuing operations (in thousands):


	Contract Liabilities, Net
Balance at December 31, 2023	$	(3,583)
Revenues recognized that were included in gross contract liabilities at December 31, 2023	13,195
Contract assets reclassified to accounts receivable in the six months ended June 30, 2024	(11,882)
Cash received in advance since prior year and remains in net contract liabilities at period-end	(1,934)
Balance at June 30, 2024	$	(4,204)


	Contract Liabilities, Net
Balance at December 31, 2022	$	(15,647)
Revenues recognized that were included in gross contract liabilities at December 31, 2022	22,065
Contract assets reclassified to accounts receivable in the six months ended June 30, 2023	(22,529)
Cash received in advance since prior year and remained in net contract liabilities at period-end	(2,356)
Write-down of contract liabilities due to impairment of a trademark licensing agreement	3,150
Contract impairments, modifications and terminations in 2023	(5,834)
Balance at June 30, 2023	$	(21,151)

Revenue from External Customers by Products and Services

The following table disaggregates revenue by type (in thousands):


	Three Months Ended June 30, 2024										Six Months Ended June 30, 2024
	Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total		Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total
Trademark licensing	$	5,272	$	—	$	—	$	—	$	5,272	$	9,357	$	—	$	—	$	—	$	9,357
Digital subscriptions and products	—		—		3,479		—		3,479		—		—		7,283		—		7,283
TV and cable programming	—		—		1,630		—		1,630		—		—		3,320		—		3,320
Consumer products	—		14,504		—		—		14,504		—		33,244		—		—		33,244
Total revenues	$	5,272	$	14,504	$	5,109	$	—	$	24,885	$	9,357	$	33,244	$	10,603	$	—	$	53,204


	Three Months Ended June 30, 2023										Six Months Ended June 30, 2023
	Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total		Licensing		Direct-to-Consumer		Digital Subscriptions and Content		Other		Total
Trademark licensing	$	10,288	$	—	$	—	$	—	$	10,288	$	19,982	$	—	$	—	$	—	$	19,982
Digital subscriptions and products	—		—		3,097		1		3,098		—		—		5,786		4		5,790
TV and cable programming	—		—		2,015		—		2,015		—		—		4,064		—		4,064
Consumer products	—		19,700		—		—		19,700		—		40,468		—		—		40,468
Total revenues	$	10,288	$	19,700	$	5,112	$	1	$	35,101	$	19,982	$	40,468	$	9,850	$	4	$	70,304

The following table disaggregates revenue by point in time versus over time (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Point in time	$	15,837	$	20,801	$	36,125	$	42,144
Over time	9,048		14,300		17,079		28,160
Total revenues	$	24,885	$	35,101	$	53,204	$	70,304

Inventories, Net (Tables)

6 Months Ended

Jun. 30, 2024

Inventory Disclosure [Abstract]

Schedule of Inventory, Current

The following table sets forth inventories, net, which are stated at the lower of cost (specific cost and first-in, first-out) and net realizable value (in thousands):


	June 30, 2024		December 31, 2023
Editorial and other pre-publication costs	$	107	$	242
Merchandise finished goods	10,248		12,758
Total	$	10,355	$	13,000

Prepaid Expenses and Other Current Assets (Tables)

6 Months Ended

Jun. 30, 2024

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Schedule of Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):


	June 30, 2024		December 31, 2023
Contract assets, current portion	$	2,120	$	1,547
Prepaid inventory not yet received	2,031		703
Prepaid software	832		1,488
Prepaid insurance	305		858
Promissory note receivable	142		1,632
Other	1,674		1,574
Total	$	7,104	$	7,802

Property and Equipment, Net (Tables)

6 Months Ended

Jun. 30, 2024

Property, Plant and Equipment [Abstract]

Schedule of Property and Equipment

Property and equipment, net consisted of the following (in thousands):


	June 30, 2024		December 31, 2023
Internally developed software	$	11,643	$	10,812
Leasehold improvements	9,987		10,682
Equipment	3,715		3,747
Furniture and fixtures	1,762		1,932
Construction in progress	699		692
Total property and equipment, gross	27,806		27,865
Less: accumulated depreciation	(16,863)		(14,351)
Total	$	10,943	$	13,514

Other Current Liabilities and Accrued Expenses (Tables)

6 Months Ended

Jun. 30, 2024

Payables and Accruals [Abstract]

Schedule of Other Current Liabilities and Accrued Expenses

Other current liabilities and accrued expenses consisted of the following (in thousands):


	June 30, 2024		December 31, 2023
Taxes	$	6,923	$	8,479
Accrued interest	3,069		3,040
Accrued salaries, wages and employee benefits	2,314		4,157
Accrued creator fees	1,951		2,113
Outstanding gift cards and store credits	1,707		1,618
Other	6,550		8,560
Total	$	22,514	$	27,967

Debt (Tables)

6 Months Ended

Jun. 30, 2024

Debt Disclosure [Abstract]

Schedule of Debt Instruments

The following table sets forth our debt (in thousands):


	June 30, 2024		December 31, 2023
Term loan, due 2027	$	209,621	$	209,772
Plus: capitalized payment-in-kind interest	5,551		1,848
Total debt	215,172		211,620
Less: unamortized debt issuance costs	(536)		(582)
Less: unamortized debt discount	(18,384)		(20,619)
Total debt, net of unamortized debt issuance costs and debt discount	196,252		190,419
Less: current portion of long-term debt	(304)		(304)
Total debt, net of current portion	$	195,948	$	190,115

Schedule of Maturities of the Principal Amount of Debt

The following table sets forth maturities of the principal amount of our A&R Term Loans as of June 30, 2024 (in thousands):


Remainder of 2024	$	152
2025	304
2026	304
2027	214,412
Total	$	215,172

Stockholders’ Equity (Tables)

6 Months Ended

Jun. 30, 2024

Equity [Abstract]

Schedule of Common Stock Reserved for Future Issuance

Common stock reserved for future issuance consisted of the following:


	June 30, 2024	December 31, 2023
Shares available for grant under equity incentive plans	3,687,252	739,178
Options issued and outstanding under equity incentive plans	1,997,466	2,291,328
Unvested restricted stock units	1,604,235	3,214,910
Vested equity awards not yet settled	1,196,828	14,994
Unvested performance-based restricted stock units	389,827	707,655
Maximum number of shares issuable to GlowUp sellers pursuant to acquisition indemnity holdback	249,116	249,116
Total common stock reserved for future issuance	9,124,724	7,217,181

Stock-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2024

Share-Based Payment Arrangement [Abstract]

Schedule of Stock Option Activity

A summary of the stock option activity under our equity incentive plans is as follows:


	Number of Options	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (in thousands)
Balance – December 31, 2023	2,291,328	$	2.49	6.4	$	311
Granted	—	—		—	—
Exercised	—	—		—	—
Forfeited, expired and cancelled	(293,862)	5.05		—	—
Balance – June 30, 2024	1,997,466	$	2.12	6.8	$	107
Exercisable – June 30, 2024	1,540,180	$	2.55	6.1	$	54
Vested and expected to vest as of June 30, 2024	1,997,466	$	2.12	6.8	$	107

Schedule of Restricted Stock Unit Activity

A summary of restricted stock unit activity under our equity incentive plans is as follows:


	Number of Awards	Weighted- Average Grant Date Fair Value per Share
Unvested and outstanding balance at December 31, 2023	3,214,910	$	2.91
Granted	—	—
Vested	(1,584,097)	3.08
Forfeited	(26,578)	3.11
Unvested and outstanding balance at June 30, 2024	1,604,235	$	2.74

Schedule of Performance Stock Unit Activity

A summary of performance-based restricted stock unit (“PSU”) activity under our 2021 Plan is as follows:


	Number of awards	Weighted- average grant date fair value per share
Unvested and outstanding balance at December 31, 2023	707,655	$	10.8
Granted	—	—
Vested (1)	(317,828)	16.93
Forfeited	—	—
Unvested and outstanding balance at June 30, 2024	389,827	$	5.80

(1) Relates to PSUs that were modified in the fourth quarter of 2023 to change the unvested shares underlying the original awards to time-based vesting.

Schedule of Allocated Share-based Compensation Expense

Stock-based compensation expense under our equity incentive plans was as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Cost of sales (1)	$	—	$	(826)	$	633	$	(453)
Selling and administrative expenses (2)	2,005		3,977		3,206		8,823
Total	$	2,005	$	3,151	$	3,839	$	8,370

Commitment and Contingencies (Tables)

6 Months Ended

Jun. 30, 2024

Commitments and Contingencies Disclosure [Abstract]

Schedule of Lease Costs

Net lease cost recognized in our unaudited condensed consolidated statements of operations for the three and six months ended June 30, 2024 and 2023 is summarized in the table below (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Operating lease cost	$	2,105	$	1,928	$	4,190	$	3,819
Variable lease cost	266		343		640		745
Short-term lease cost	445		581		848		1,291
Sublease income	(232)		(196)		(454)		(265)
Total	$	2,584	$	2,656	$	5,224	$	5,590

Maturities of Operating Lease Liabilities

Maturities of our operating lease liabilities as of June 30, 2024 were as follows (in thousands):


Remainder of 2024	$	4,129
2025	7,900
2026	7,314
2027	4,832
2028	2,458
Thereafter	5,773
Total undiscounted lease payments	32,406
Less: imputed interest	(5,340)
Total operating lease liabilities	$	27,066

Operating lease liabilities, current portion	$	6,438
Operating lease liabilities, noncurrent portion	$	20,628

Severance Costs (Tables)

6 Months Ended

Jun. 30, 2024

Restructuring and Related Activities [Abstract]

Restructuring and Related Costs

Severance costs in our condensed consolidated statements of operations were as follows (in thousands):


	Three Months Ended June 30, 2023		Six Months Ended June 30, 2023
Direct-to-Consumer	$	756	$	1,127
Licensing	36		53
Digital Subscriptions and Content	—		39
Corporate	10		1,221
Total	$	802	$	2,440


	Employee Separation Costs
Balance at December 31, 2023	$	1,184
Costs incurred and charged to expense	169
Costs paid or otherwise settled	(1,157)
Balance at June 30, 2024	$	196

Net Loss Per Share (Tables)

6 Months Ended

Jun. 30, 2024

Earnings Per Share [Abstract]

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

The following outstanding potentially dilutive shares have been excluded from the calculation of diluted net loss per share due to their anti-dilutive effect:


	Three Months Ended June 30,		Six Months Ended June 30,
	2024	2023	2024	2023
Options issued and outstanding under equity incentive plans	1,997,466	2,496,494	1,997,466	2,496,494
Unvested restricted stock units	1,604,235	1,066,281	1,604,235	1,066,281
Unvested performance-based restricted stock units	389,827	1,089,045	389,827	1,089,045
Total	3,991,528	4,651,820	3,991,528	4,651,820

Segments (Tables)

6 Months Ended

Jun. 30, 2024

Segment Reporting [Abstract]

Schedule of Segment Reporting Information

The following table sets forth financial information by reportable segment (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net revenues:
Direct-to-Consumer	$	14,504	$	19,700	$	33,244	$	40,468
Licensing	5,272		10,288		9,357		19,982
Digital Subscriptions and Content	5,109		5,112		10,603		9,850
All Other	—		1		—		4
Total	$	24,885	$	35,101	$	53,204	$	70,304
Operating (loss) income:
Direct-to-Consumer	$	(2,365)	$	(75,002)	$	(1,483)	$	(90,058)
Licensing	4,323		(65,131)		6,340		(61,564)
Digital Subscriptions and Content	(2,215)		1,002		(2,314)		393
Corporate	(8,948)		(13,918)		(20,675)		(29,794)
All Other	2		(7)		12		(12)
Total	$	(9,203)	$	(153,056)	$	(18,120)	$	(181,035)

Revenue from by Geographic Area

The following table sets forth revenue by geographic area (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net revenues:
United States	$	11,470	$	14,975	$	25,630	$	30,634
Australia	6,689		7,608		14,823		15,136
China	3,024		7,475		4,470		14,423
UK	2,044		2,943		4,744		5,445
Other	1,658		2,100		3,537		4,666
Total	$	24,885	$	35,101	$	53,204	$	70,304

Basis of Presentation and Summary of Significant Accounting Policies - Segment Information (Details)	6 Months Ended
	Jun. 30, 2024 segment
Accounting Policies [Abstract]
Number of reportable segments	3

Basis of Presentation and Summary of Significant Accounting Policies - Concentration Risk (Details)	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2023
Revenue Benchmark \| Customer Concentration Risk \| Customer A
Concentration Risk [Line Items]
Concentration risk, percentage	15.00%	15.00%

Basis of Presentation and Summary of Significant Accounting Policies - Liquidity Assessment and Management's Plans (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Accounting Policies [Abstract]
Increase (decrease) in revenue	$ (10,200)		$ (17,100)
Operating (loss) income	(9,203)	$ (153,056)	(18,120)	$ (181,035)
Net cash used in operating activities from continuing operations			(12,780)	(26,653)
Cash and cash equivalents	$ 16,850	$ 34,404	$ 16,850	$ 34,404	$ 28,120

Basis of Presentation and Summary of Significant Accounting Policies - Advertising Costs (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Advertising expenses	$ 1.1	$ 1.4	$ 2.1	$ 3.7
Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Advertising costs related to discontinued operations		$ 0.3		$ 2.3

Basis of Presentation and Summary of Significant Accounting Policies - Intangible Assets and Goodwill (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Finite-Lived Intangible Assets [Line Items]
Impairment on right-of-use assets	$ 0.6
Goodwill and intangible asset impairment	$ 0.0		$ 0.0
Impairment of indefinite-lived intangible assets		$ 65.5
Impairments		$ 66.7
Trade Names
Finite-Lived Intangible Assets [Line Items]
Impairment of indefinite-lived intangible assets				$ 5.1

Basis of Presentation and Summary of Significant Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023	Dec. 31, 2022
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Deferred revenues, current portion	$ 9,583		$ 9,205	$ 10,480
Minimum
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Gift card expiration period	3 years
Maximum
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Gift card expiration period	5 years
Gift Card
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Deferred revenues, current portion	$ 1,700		$ 1,600	$ 1,600
Revenue recognized	$ 500	$ 700

Fair Value Measurements - Financial Assets and Liabilities (Details) - Fair Value, Recurring - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration liability	$ (343)	$ (399)
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration liability	0	0
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration liability	0	0
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration liability	$ (343)	$ (399)

Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Digital asset impairments	$ 0.0		$ 0.0
Discontinued Operations, Disposed of by Sale
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impairment charges	$ 0.0		$ 2.4
Series A Preferred Stock
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value remeasurement of contingent consideration		$ 9.5		$ 6.5

Fair Value Measurements - Change in Fair Value Of Liability (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Change in fair value	$ 0	$ 9,523	$ 0	$ 6,505
Level 3 \| Contingent Consideration
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at December 31, 2023			399
Change in fair value			(56)
Balance at June 30, 2024	$ 343		$ 343

Revenue Recognition - Contract Balances (Details) - Disposal Group, Held-for-sale, Not Discontinued Operations $ in Millions	Dec. 31, 2022 USD ($)
Revenue from External Customer [Line Items]
Accounts receivable	$ 4.2
Contract liabilities	$ 0.3

Revenue Recognition - Contract Assets and Contract Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023	Jun. 30, 2023	Dec. 31, 2022
Revenue from Contract with Customer [Abstract]
Accounts receivable	$ 5,724	$ 7,496		$ 14,214
Contract Balances:
Contract assets, current portion	2,120	1,547		2,559
Contract assets, net of current portion	8,014	8,716		13,680
Contract liabilities, current portion	(9,583)	(9,205)		(10,480)
Contract liabilities, net of current portion	(4,755)	(4,641)		(21,406)
Contract liabilities, net	$ (4,204)	$ (3,583)	$ (21,151)	$ (15,647)

Revenue Recognition - Roll-Forward of Netted Contract Assets and Contract Liabilities (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Change in Contract with Customer, Asset and Liability [Roll Forward]
Balance at beginning of period	$ (3,583)	$ (15,647)
Revenues recognized that were included in gross contract liabilities	13,195	22,065
Contract assets reclassified to accounts receivable	(11,882)	(22,529)
Cash received in advance since prior year and remains in net contract liabilities at period-end	(1,934)	(2,356)
Write-down of contract liabilities due to impairment of a trademark licensing agreement		3,150
Contract impairments, modifications and terminations		(5,834)
Balance at end of period	$ (4,204)	$ (21,151)

Revenue Recognition - Performance Obligation (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, amount	$ 72,500		$ 72,500
Net revenues	24,885	$ 35,101	53,204	$ 70,304
Trademark licensing
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, amount	66,200		66,200
Net revenues	5,272	10,288	9,357	19,982
Digital subscriptions and products
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, amount	5,500		5,500
Net revenues	3,479	$ 3,098	7,283	$ 5,790
Other Obligations
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, amount	$ 800		$ 800
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-07-01 \| Trademark licensing
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, period (in years)	7 years		7 years
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-07-01 \| Trademark licensing \| Performance Obligation Recognition Period One
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, period (in years)	5 years		5 years
Revenue, remaining performance obligation (as a percent)	97.00%		97.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-07-01 \| Digital subscriptions and products
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, period (in years)	5 years		5 years
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-07-01 \| Digital subscriptions and products \| Performance Obligation Recognition Period One
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, period (in years)	1 year		1 year
Revenue, remaining performance obligation (as a percent)	51.00%		51.00%

Revenue Recognition - Disaggregation of Revenues (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Revenue from External Customer [Line Items]
Total revenues	$ 24,885	$ 35,101	$ 53,204	$ 70,304
Transferred at Point in Time
Revenue from External Customer [Line Items]
Total revenues	15,837	20,801	36,125	42,144
Transferred over Time
Revenue from External Customer [Line Items]
Total revenues	9,048	14,300	17,079	28,160
Trademark licensing
Revenue from External Customer [Line Items]
Total revenues	5,272	10,288	9,357	19,982
Digital subscriptions and products
Revenue from External Customer [Line Items]
Total revenues	3,479	3,098	7,283	5,790
TV and cable programming
Revenue from External Customer [Line Items]
Total revenues	1,630	2,015	3,320	4,064
Consumer products
Revenue from External Customer [Line Items]
Total revenues	14,504	19,700	33,244	40,468
All Other
Revenue from External Customer [Line Items]
Total revenues	0	1	0	4
All Other \| Trademark licensing
Revenue from External Customer [Line Items]
Total revenues	0	0	0	0
All Other \| Digital subscriptions and products
Revenue from External Customer [Line Items]
Total revenues	0	1	0	4
All Other \| TV and cable programming
Revenue from External Customer [Line Items]
Total revenues	0	0	0	0
All Other \| Consumer products
Revenue from External Customer [Line Items]
Total revenues	0	0	0	0
Licensing \| Operating Segments
Revenue from External Customer [Line Items]
Total revenues	5,272	10,288	9,357	19,982
Licensing \| Operating Segments \| Trademark licensing
Revenue from External Customer [Line Items]
Total revenues	5,272	10,288	9,357	19,982
Licensing \| Operating Segments \| Digital subscriptions and products
Revenue from External Customer [Line Items]
Total revenues	0	0	0	0
Licensing \| Operating Segments \| TV and cable programming
Revenue from External Customer [Line Items]
Total revenues	0	0	0	0
Licensing \| Operating Segments \| Consumer products
Revenue from External Customer [Line Items]
Total revenues	0	0	0	0
Direct-to-Consumer \| Operating Segments
Revenue from External Customer [Line Items]
Total revenues	14,504	19,700	33,244	40,468
Direct-to-Consumer \| Operating Segments \| Trademark licensing
Revenue from External Customer [Line Items]
Total revenues	0	0	0	0
Direct-to-Consumer \| Operating Segments \| Digital subscriptions and products
Revenue from External Customer [Line Items]
Total revenues	0	0	0	0
Direct-to-Consumer \| Operating Segments \| TV and cable programming
Revenue from External Customer [Line Items]
Total revenues	0	0	0	0
Direct-to-Consumer \| Operating Segments \| Consumer products
Revenue from External Customer [Line Items]
Total revenues	14,504	19,700	33,244	40,468
Digital Subscriptions and Content \| Operating Segments
Revenue from External Customer [Line Items]
Total revenues	5,109	5,112	10,603	9,850
Digital Subscriptions and Content \| Operating Segments \| Trademark licensing
Revenue from External Customer [Line Items]
Total revenues	0	0	0	0
Digital Subscriptions and Content \| Operating Segments \| Digital subscriptions and products
Revenue from External Customer [Line Items]
Total revenues	3,479	3,097	7,283	5,786
Digital Subscriptions and Content \| Operating Segments \| TV and cable programming
Revenue from External Customer [Line Items]
Total revenues	1,630	2,015	3,320	4,064
Digital Subscriptions and Content \| Operating Segments \| Consumer products
Revenue from External Customer [Line Items]
Total revenues	$ 0	$ 0	$ 0	$ 0

Inventories, Net (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Editorial and other pre-publication costs	$ 107	$ 242
Merchandise finished goods	10,248	12,758
Total	10,355	13,000
Inventory reserves	$ 4,600	$ 5,500

Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Contract assets, current portion	$ 2,120	$ 1,547
Prepaid inventory not yet received	2,031	703
Prepaid software	832	1,488
Prepaid insurance	305	858
Promissory note receivable	142	1,632
Other	1,674	1,574
Total	$ 7,104	$ 7,802

Property and Equipment, Net (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	$ 27,806		$ 27,806		$ 27,865
Less: accumulated depreciation	(16,863)		(16,863)		(14,351)
Total	10,943		10,943		13,514
Depreciation and amortization	2,200	$ 1,300	3,600	$ 2,500
Internally developed software
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	11,643		11,643		10,812
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	9,987		9,987		10,682
Equipment
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	3,715		3,715		3,747
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	1,762		1,762		1,932
Construction in progress
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	$ 699		$ 699		$ 692

Other Current Liabilities and Accrued Expenses (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Taxes	$ 6,923	$ 8,479
Accrued interest	3,069	3,040
Accrued salaries, wages and employee benefits	2,314	4,157
Accrued creator fees	1,951	2,113
Outstanding gift cards and store credits	1,707	1,618
Other	6,550	8,560
Total	$ 22,514	$ 27,967

Debt - Schedule of Debt Instruments (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Debt Instrument [Line Items]
Long-term debt, gross	$ 215,172	$ 211,620
Less: unamortized debt issuance costs	(536)	(582)
Less: unamortized debt discount	(18,384)	(20,619)
Total debt, net of unamortized debt issuance costs and debt discount	196,252	190,419
Less: current portion of long-term debt	(304)	(304)
Total debt, net of current portion	195,948	190,115
Term Loan
Debt Instrument [Line Items]
Long-term debt, gross	215,172
Term Loan \| Term loan, due 2027
Debt Instrument [Line Items]
Long-term debt, gross	209,621	209,772
Plus: capitalized payment-in-kind- interest
Debt Instrument [Line Items]
Long-term debt, gross	$ 5,551	$ 1,848

Debt - Narrative (Details) - USD ($) $ in Thousands			6 Months Ended
Debt - Narrative (Details) - USD ($) $ in Thousands	Nov. 02, 2023	May 10, 2023	Jun. 30, 2024	Mar. 27, 2024	Dec. 31, 2023
Debt Instrument [Line Items]
Long-term debt, gross			$ 215,172		$ 211,620
Term Loan
Debt Instrument [Line Items]
Long-term debt, gross			$ 215,172
A&R Term Loans \| Term Loan
Debt Instrument [Line Items]
Percent of term loans		90.00%
Preferred stock exchanged (in shares)		50,000
Term loan, amount borrowed		$ 53,600
Term loan, additional funding		11,800
Long-term debt, gross		$ 210,000
Net leverage ratio reduction per quarter		0.25
Minimum consolidated cash balance required				$ 7,500
A&R Term Loans \| Term Loan \| Debt Covenant One
Debt Instrument [Line Items]
Total net leverage ratio		7.25
A&R Term Loans \| Term Loan \| Debt Covenant Two
Debt Instrument [Line Items]
Total net leverage ratio		5.25
A&R Term Loans, Tranche A \| Term Loan
Debt Instrument [Line Items]
Long-term debt, gross		$ 20,600
Quarterly amortization payments		$ 76
Basis spread on variable rate (as a percent)		6.25%
Debt instrument, SOFR adjustment (as a percent)		0.10%
Interest rate floor (as a percent)		0.50%
Stated interest rate (as a percent)			11.68%		11.41%
Effective interest rate (as a percent)			12.30%		12.03%
A&R Term Loans, Tranche B \| Term Loan
Debt Instrument [Line Items]
Long-term debt, gross		$ 189,400
Basis spread on variable rate (as a percent)		4.25%
Debt instrument, SOFR adjustment (as a percent)		0.10%
Interest rate floor (as a percent)		0.50%
Stated interest rate (as a percent)			9.68%		9.41%
Effective interest rate (as a percent)			13.55%		13.27%
Debt discount capitalized			$ 21,300
Term loan, due 2027 \| Term Loan
Debt Instrument [Line Items]
Long-term debt, gross			$ 209,621		$ 209,772
Basis spread on variable rate (as a percent)	1.00%

Debt - Term Loan Maturities (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Debt Instrument [Line Items]
Total	$ 215,172	$ 211,620
Term Loan
Debt Instrument [Line Items]
Remainder of 2024	152
2025	304
2026	304
2027	214,412
Total	$ 215,172

Stockholders’ Equity - Schedule of Common Stock Reserved for Future Issuance (Details) - shares	Jun. 30, 2024	Dec. 31, 2023
Class of Stock [Line Items]
Total common stock reserved for future issuance (in shares)	9,124,724	7,217,181
Shares available for grant under equity incentive plans
Class of Stock [Line Items]
Total common stock reserved for future issuance (in shares)	3,687,252	739,178
Options issued and outstanding under equity incentive plans
Class of Stock [Line Items]
Total common stock reserved for future issuance (in shares)	1,997,466	2,291,328
Unvested restricted stock units
Class of Stock [Line Items]
Total common stock reserved for future issuance (in shares)	1,604,235	3,214,910
Vested equity awards not yet settled
Class of Stock [Line Items]
Total common stock reserved for future issuance (in shares)	1,196,828	14,994
Unvested performance-based restricted stock units
Class of Stock [Line Items]
Total common stock reserved for future issuance (in shares)	389,827	707,655
Maximum number of shares issuable to GlowUp sellers pursuant to acquisition indemnity holdback
Class of Stock [Line Items]
Total common stock reserved for future issuance (in shares)	249,116	249,116

Stock-Based Compensation - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total common stock reserved for future issuance (in shares)	9,124,724		9,124,724		7,217,181
Share-based compensation expense	$ 2,005	$ 3,151	$ 3,839	$ 8,370
Internally developed software
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 0	500	$ 0	1,200
Vested Restricted Stock Units Not Yet Settled
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total common stock reserved for future issuance (in shares)	879,000		879,000
Vested Performance Share Units Not Yet Settled
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total common stock reserved for future issuance (in shares)	317,828		317,828
Restricted stock units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of awards vested	$ 1,100	$ 1,200	$ 1,400	$ 1,600
Vested (in shares)			1,584,097
Performance Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of awards vested	200		$ 200
Vested (in shares)		0	317,828	0
Unrecognized compensation expense	4,200		$ 4,200
Unrecognized compensation expense, period for recognition, years			1 year 3 months 14 days
Employee stock option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense	$ 500		$ 500
Unrecognized compensation expense, period for recognition, years			1 year
2021 Equity and incentive compensation plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized for issuance (in shares)	10,737,065		10,737,065
2018 Equity incentive plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized for issuance (in shares)	6,287,687		6,287,687

Stock-Based Compensation - Schedule of Stock Option Activity (Details) - Employee stock option - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2024	Dec. 31, 2023
Number of Options
Beginning balance (in shares)	2,291,328
Granted (in shares)	0
Exercised (in shares)	0
Forfeited, expired and cancelled (in shares)	(293,862)
Ending balance (in shares)	1,997,466	2,291,328
Exercisable (in shares)	1,540,180
Vested and expected to vest, number of options (in shares)	1,997,466
Weighted- Average Exercise Price
Beginning balance (in dollars per share)	$ 2.49
Granted (in dollars per share)	0
Exercised (in dollars per share)	0
Forfeited, expired and cancelled (in dollars per share)	5.05
Ending balance (in dollars per share)	2.12	$ 2.49
Exercisable (in dollars per share)	2.55
Vested and expected to vest, weighted-average exercise price (in dollars per share)	$ 2.12
Weighted- Average Remaining Contractual Term (years)
Weighted average remaining contractual term (in years)	6 years 9 months 18 days	6 years 4 months 24 days
Weighted average remaining contractual term, exercisable (in years)	6 years 1 month 6 days
Vested and expected to vest, weighted-average remaining contractual term (in years)	6 years 9 months 18 days
Aggregate Intrinsic Value (in thousands)
Beginning aggregate intrinsic value	$ 311
Ending aggregate intrinsic value	107	$ 311
Exercisable aggregate intrinsic value	54
Vested and expected to vest, aggregate intrinsic value	$ 107

Stock-Based Compensation - Schedule of Restricted Stock Unit Activity (Details) - Unvested restricted stock units	6 Months Ended
	Jun. 30, 2024 $ / shares shares
Number of Awards
Beginning balance (in shares) \| shares	3,214,910
Granted (in shares) \| shares	0
Vested (in shares) \| shares	(1,584,097)
Forfeited (in shares) \| shares	(26,578)
Ending balance (in shares) \| shares	1,604,235
Weighted- Average Grant Date Fair Value per Share
Beginning balance (in dollars per share) \| $ / shares	$ 2.91
Granted (in dollars per share) \| $ / shares	0
Vested (in dollars per share) \| $ / shares	3.08
Forfeited (in dollars per share) \| $ / shares	3.11
Ending balance (in dollars per share) \| $ / shares	$ 2.74

Stock-Based Compensation - Schedule of Performance Stock Activity (Details) - Performance Stock Units - $ / shares	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Number of Awards
Beginning balance (in shares)		707,655
Granted (in shares)		0
Vested (in shares)	0	(317,828)	0
Forfeited (in shares)		0
Ending balance (in shares)		389,827
Weighted- Average Grant Date Fair Value per Share
Beginning balance (in dollars per share)		$ 10.8
Granted (in dollars per share)		0
Vested (in dollars per share)		16.93
Forfeited (in dollars per share)		0
Ending balance (in dollars per share)		$ 5.80

Stock-Based Compensation - Schedule of Allocated Share-based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense	$ 2,005	$ 3,151	$ 3,839	$ 8,370
Accelerated amortization of stock-based compensation expense		1,300		2,300
Internally developed software
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense	0	500	0	1,200
Cost of sales
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense	0	(826)	633	(453)
Cost of sales \| Independent Contractor
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense	0	(1,100)	0	(1,100)
Selling and administrative expenses
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense	$ 2,005	$ 3,977	$ 3,206	$ 8,823

Commitment and Contingencies - Leases (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Weighted average remaining term of operating lease	4 years 8 months 12 days		4 years 8 months 12 days		5 years 2 months 12 days
Weighted average discount rate	7.10%		7.10%		7.00%
Cash payments for amounts included in the measurement of operating lease liabilities	$ 2,100	$ 2,100	$ 4,500	$ 4,300
Right-of-use assets in exchange for lease liabilities - continuing operations	0	1,200	600	2,400
Lease cost	$ 2,584	$ 2,656	$ 5,224	$ 5,590

Commitment and Contingencies - Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Leases [Abstract]
Operating lease cost	$ 2,105	$ 1,928	$ 4,190	$ 3,819
Variable lease cost	266	343	640	745
Short-term lease cost	445	581	848	1,291
Sublease income	(232)	(196)	(454)	(265)
Total	$ 2,584	$ 2,656	$ 5,224	$ 5,590

Commitment and Contingencies - Schedule of Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Remainder of 2024	$ 4,129
2025	7,900
2026	7,314
2027	4,832
2028	2,458
Thereafter	5,773
Total undiscounted lease payments	32,406
Less: imputed interest	(5,340)
Total operating lease liabilities	27,066
Operating lease liabilities, current portion	6,438	$ 6,955
Operating lease liabilities, noncurrent portion	$ 20,628	$ 24,621

Commitment and Contingencies - Legal Contingencies (Details) $ in Millions	Jul. 05, 2024 USD ($)	Jun. 06, 2023 claim	Feb. 25, 2021 claim
AVS Case
Loss Contingencies [Line Items]
Claims dismissed		6
Claims filed			10
Former Model Case \| Minimum \| Subsequent Event
Loss Contingencies [Line Items]
Damages sought \| $	$ 2

Severance Costs (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Severance Costs (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Restructuring Cost and Reserve [Line Items]
Severance costs	$ 0	$ 802	$ 0	$ 2,440
Employee Separation Costs
Restructuring Reserve [Roll Forward]
Balance at December 31, 2023			1,184
Costs incurred and charged to expense			169
Costs paid or otherwise settled			(1,157)
Balance at June 30, 2024	$ 196		$ 196
Operating Segments \| Direct-to-Consumer
Restructuring Cost and Reserve [Line Items]
Severance costs		756		1,127
Operating Segments \| Licensing
Restructuring Cost and Reserve [Line Items]
Severance costs		36		53
Operating Segments \| Digital Subscriptions and Content
Restructuring Cost and Reserve [Line Items]
Severance costs		0		39
Corporate
Restructuring Cost and Reserve [Line Items]
Severance costs		$ 10		$ 1,221

Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
Income Taxes (Details) - USD ($) $ in Millions	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Income Tax Disclosure [Abstract]
Effective tax rate percentage, expense (benefit)	(3.80%)	6.30%	(5.30%)	5.90%
Repatriation of foreign earnings	$ 2.7

Net Loss Per Share - Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	3,991,528	4,651,820	3,991,528	4,651,820
Options issued and outstanding under equity incentive plans
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	1,997,466	2,496,494	1,997,466	2,496,494
Unvested restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	1,604,235	1,066,281	1,604,235	1,066,281
Unvested performance-based restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	389,827	1,089,045	389,827	1,089,045

Segments - Financial Information by Reportable Segment (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024 USD ($) country store	Jun. 30, 2023 USD ($)	Jun. 30, 2024 USD ($) segment country store	Jun. 30, 2023 USD ($)
Segment Reporting Information [Line Items]
Number of reportable segments \| segment			3
Net revenues	$ 24,885	$ 35,101	$ 53,204	$ 70,304
Operating (loss) income	(9,203)	(153,056)	(18,120)	(181,035)
Operating Segments \| Licensing
Segment Reporting Information [Line Items]
Net revenues	5,272	10,288	9,357	19,982
Operating (loss) income	4,323	(65,131)	6,340	(61,564)
Operating Segments \| Direct-to-Consumer
Segment Reporting Information [Line Items]
Net revenues	14,504	19,700	33,244	40,468
Operating (loss) income	(2,365)	(75,002)	(1,483)	(90,058)
Operating Segments \| Digital Subscriptions and Content
Segment Reporting Information [Line Items]
Net revenues	5,109	5,112	10,603	9,850
Operating (loss) income	(2,215)	1,002	(2,314)	393
Corporate
Segment Reporting Information [Line Items]
Operating (loss) income	(8,948)	(13,918)	(20,675)	(29,794)
All Other
Segment Reporting Information [Line Items]
Net revenues	0	1	0	4
Operating (loss) income	$ 2	$ (7)	$ 12	$ (12)
Honey Birdette
Segment Reporting Information [Line Items]
Number of stores \| store	59		59
Number of countries \| country	3		3

Segments - Geographic Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Segment Reporting Information [Line Items]
Total revenues	$ 24,885	$ 35,101	$ 53,204	$ 70,304
United States
Segment Reporting Information [Line Items]
Total revenues	11,470	14,975	25,630	30,634
Australia
Segment Reporting Information [Line Items]
Total revenues	6,689	7,608	14,823	15,136
China
Segment Reporting Information [Line Items]
Total revenues	3,024	7,475	4,470	14,423
UK
Segment Reporting Information [Line Items]
Total revenues	2,044	2,943	4,744	5,445
Other
Segment Reporting Information [Line Items]
Total revenues	$ 1,658	$ 2,100	$ 3,537	$ 4,666

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