21. Discontinued operations and assets held for sale

(a) Complexity

As discussed in Note 4, on March 1, 2024, the Company sold Complexity and recognized a gain on disposition of $3.0 million, resulting in Complexity meeting the requirements for presentation as discontinued operations.

The Company recognized a pretax net loss of $1.4 million for the year ended December 31, 2024, in net income (loss) from discontinued operations in the consolidated statements of operations and comprehensive loss in relation to Complexity. The pretax net loss of $1.4 million during the year ended December 31, 2024, includes revenue of $1.0 million, cost of revenue of $0.9 million, and operating expenses of $1.5 million.

Complexity had amortization and depreciation of $0.2 million for the year ended December 31, 2024. Complexity did not have significant capital expenditures or significant noncash activity during the periods presented.

(b) FaZe Media

As discussed in Note 4, on April 1, 2025, the Company sold FaZe Media and recognized a gain on disposition of $3.0 million, resulting in FaZe Media meeting the requirements for presentation as discontinued operations.

The Company recognized a pretax net loss of $2.6 million and $8.8 million for the year ended December 31, 2025 and 2024, in net income (loss) from discontinued operations in the consolidated statements of operations and comprehensive loss in relation to FaZe Media. The pretax net loss of $2.6 million during the year ended December 31, 2025, includes revenue of $6.4 million, cost of revenue of $6.4 million, and operating expenses of $2.6 million. The pretax net loss of $8.8 million during the year ended December 31, 2024, includes revenue of $21.8 million, cost of revenue of $18.2 million, and operating expenses of $12.4 million.

FaZe Media had amortization and depreciation of $0.3 million and $1.3 million for the year ended December 31, 2025 and 2024. FaZe Media did not have significant capital expenditures or significant noncash activity during the periods presented.

(c) Frankly

During the third quarter of 2025, the Company executed a plan to discontinue the operations of Frankly, following a strategic decision to focus the Company’s resources on its full-service creative agency, SaaS and newly launched digital asset treasury. Subsequent to the Frankly asset disposal (see Note 4), the business of Frankly that remained was its legacy programmatic advertising operation. Given its single digit-gross margins and operating losses, management deemed it in the best interest of the Company to discontinue operations of Frankly. During the year ended December 31, 2025, Frankly met the requirements to be reported as discontinued operations.

The Company recognized a pretax net loss of $12.3 million and $12.0 million for the years ended December 31, 2025 and 2024, in net income (loss) from discontinued operations in the consolidated statements of operations and comprehensive loss in relation to Frankly. The pretax net loss of $12.3 million during the year ended December 31, 2025, includes revenue of $15.4 million, cost of revenue of $15.2 million, and operating expenses of $12.5 million. The pretax net loss of $12.0 million during the year ended December 31, 2024, includes revenue of $46.9 million, cost of revenue of $44.7 million, and operating expenses of $14.2 million.

Frankly had amortization and depreciation of $0.1 million and $0.6 million for the years ended December 31, 2025 and 2024. Frankly did not have significant capital expenditures or significant noncash activity during the periods presented outside of the following: a) Frankly recorded a non-cash impairment charge to goodwill and intangible assets of $8.5 million during the year ended December 31, 2025 (see Note 9); and b) Frankly recorded a non-cash impairment charge of $2.1 million on promissory notes receivable and c) Frankly recorded a non-cash loss on disposition of assets of $8.3 million during the year ended December 31, 2024 (see Note 4).