v3.25.2
Fair Value Measurements
 6 Months Ended
Jun. 30, 2025
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
Certain assets and liabilities are carried at fair value under U.S. GAAP. Fair value is defined as 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. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value and nonrecurring fair value measurements are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable:
 
•Level 1 — Quoted prices in active markets for identical assets or liabilities.
•Level 2 — Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.

•Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.

The following tables set forth the fair value of the Company’s financial assets and liabilities measured at fair value as of June 30, 2025 and December 31, 2024 based on the three-tier fair value hierarchy:

June 30, 2025
Level 1Level 2Level 3Total
Assets
Cash equivalents:
Money market funds$278,780 
(1)
$— $— $278,780 
Other non-current assets:
Derivative instruments— — 7,059 
(3)
7,059 
Equity securities— 13,533 
(2)
— 13,533 
Total$278,780 $13,533 $7,059 $299,372 
Liabilities
Other current liabilities$— $— $36,028 
(5)
$36,028 
Warrant liabilities— 14,205 
(4)
— 14,205 
Other long-term liabilities— — 18,541 
(5)
18,541 
Total$— $14,205 $54,569 $68,774 

December 31, 2024
Level 1Level 2Level 3Total
Assets
Other non-current assets:
Derivative instruments$— $— $7,059 
(3)
$7,059 
Equity securities— 13,533 
(2)
— 13,533 
Total$— $13,533 $7,059 $20,592 
Liabilities
Other current liabilities$— $— $3,300 
(5)
$3,300 
Warrant liabilities— 22,033 
(4)
— 22,033 
Other long-term liabilities— — 74,665 
(5)
74,665 
Total$— $22,033 $77,965 $99,998 

(1)Represents the Company’s money market funds, which are classified as Level 1 because the Company measures these assets to fair value using quoted market prices.
(2)Represents the Company’s non-marketable equity securities, which are classified as Level 2 because the Company measures these assets to fair value using observable inputs for similar investments of the same issuer. The Company has elected the remeasurement alternative for these assets.
(3)Represents the Company’s derivative instruments held in other public and privately held entities. The Company measures these derivative instruments to fair value using option pricing models and, accordingly, classifies these assets as Level 3. There were no new Level 3 derivative instruments sold, purchased by or issued to the Company during the six months ended June 30, 2025. The table below includes a range and an average weighted by relative fair value of the significant unobservable inputs used to measure these Level 3 derivative instruments to fair value. The key inputs to the valuations are underlying stock price, volatility and risk free rate. A change in these significant unobservable inputs might result in a significantly higher or lower fair value measurement at the reporting date. Changes to fair value of these instruments are
recorded in Other gain (loss), net on the condensed consolidated statements of operations in the condensed consolidated statements of cash flows.
(4)The Company measures its Private Warrants and the GNOG Private Warrants to fair value using a binomial lattice model or a Black-Scholes model, where appropriate, with the significant assumptions being observable inputs and, accordingly, classifies these liabilities as Level 2. Key assumptions used in the valuation of the Private Warrants and GNOG Private Warrants include term, risk free rate and volatility.
(5)Represents the contingent consideration issuable to former SIQ, Dijon and Simplebet securityholders in connection with the acquisition of SIQ, the acquisition of Dijon and Simplebet Transaction upon the achievement of certain performance targets. The fair value of contingent consideration was generally calculated using customary valuation models based on probability-weighted outcomes of meeting certain future performance targets and forecasted results. The Company classified the contingent consideration liabilities as a Level 3 fair value measurement due to the lack of observable inputs used in the model. The key inputs to the valuations are the projections of future financial results in relation to the business, revenue risk premium, revenue volatility, and operational leverage ratio as well as management judgment regarding the probability of achieving a future performance target. The table below includes a range and an average weighted by relative fair value of the significant unobservable inputs used to measure contingent consideration at fair value. A change in these significant unobservable inputs might result in a significantly higher or lower fair value measurement at the reporting date. Changes to fair value of these instruments are recorded in Other (loss) gain, net on the condensed consolidated statements of operations.
June 30, 2025December 31, 2024
Significant Unobservable Input of Level 3 InvestmentsRange (Weighted Average)Range (Weighted Average)
Revenue volatility
10.6% - 15.2% (13.2%)
17.3% - 17.7% (17.6%)
Equity volatility
45.0% - 47.1% (46.2%)
53.4% - 60.0% (55.3%)
Operational leverage ratio
65.0% - 75.0% (69.4%)
65.0% - 70.0% (66.4%)

The following table provides a roll forward of the recurring Level 3 fair value liability measurements:
Six Months Ended June 30, 2025
Balance at January 1, 2025$77,965 
Settlement of contingent consideration liabilities(3,300)
Fair value adjustment to contingent consideration liabilities(20,096)
Balance at June 30, 2025$54,569