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FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
NOTE 2—FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
Investment in MGM
June 30, 2026December 31, 2025
(In thousands)
Investment in MGM$3,194,777 $2,401,858 
At June 30, 2026, the Company owns 66.8 million common shares of MGM, including 1.0 million common shares purchased in the first quarter of 2026 for $37.2 million, which represents approximately 26.6% of MGM's common shares outstanding. The Company accounts for its investment in MGM under the equity method of accounting using the fair value option. The fair value of the investment in MGM is remeasured each reporting period based upon MGM’s closing stock price on the New York Stock Exchange on the last trading day in the reporting period; any unrealized pre-tax gains or losses are included in the statement of operations. For the three and six months ended June 30, 2026, the Company recorded unrealized pre-tax gains of $721.7 million and $755.7 million, respectively, from its investment in MGM. For the three and six months ended June 30, 2025, the Company recorded an unrealized pre-tax gain and loss of $307.4 million and $16.8 million, respectively, from its investment in MGM. The cumulative unrealized net pre-tax gain through June 30, 2026 is $1.9 billion. A $2.00 increase or decrease in the share price of MGM would result in an unrealized gain or loss, respectively, of $133.6 million.
On April 3, 2026, the Company entered into a voting agreement with MGM and Barry Diller (the “MGM Voting Agreement”). Pursuant to the MGM Voting Agreement, when a matter is brought to a vote at an annual or special MGM shareholder meeting (or by written consent in lieu of a meeting), the Company, Mr. Diller and their controlled affiliates (the “Covered Entities”) will vote the voting securities they beneficially own in excess of 25.73% of MGM’s total voting power (the “Excess Voting Securities”) in the same proportion as MGM’s other voting shareholders vote on that matter (excluding shareholders who do not vote).
The MGM Voting Agreement automatically terminates upon the earliest of: (a) the Covered Entities collectively ceasing to beneficially own at least 17.5% of MGM’s outstanding voting securities; (b) the MGM Board’s failure to nominate two directors designated by the Company (if the Company has designated two directors) who qualify under MGM’s Corporate Governance Guidelines (“Qualified Directors”) to stand for election (the “Nomination Condition”); or (c) a change of control of MGM. If the Company chooses not to designate one or more directors, the MGM Voting Agreement does not terminate. In order to satisfy the Nomination Condition, if at any time the MGM Board has fewer than two Company designated directors, the MGM Board must add Qualified Director(s) within one month of the Company’s designation (subject to required regulatory approvals). At signing, Mr. Diller was deemed designated by the Company to serve on the MGM Board.
Additionally, Mr. Diller and his controlled affiliates (other than the Company and its affiliates, the “Diller Entities”) will cease to be subject to the voting limitation on the Excess Voting Securities and will no longer be considered Covered Entities when both: (i) Mr. Diller no longer serves as the Company’s Chairman or Senior Executive, and (ii) the Diller Entities no longer beneficially own voting securities of the Company representing at least one‑third of the Company’s total voting power.
The following table presents MGM’s summarized financial information for the six months ended June 30, 2026 and 2025. As noted above, the Company accounts for its investment in MGM under the equity method of accounting using the fair value option. As a result, the carrying value of our investment and the gain or loss in any given period are not necessarily correlated with the income statement information presented below.
Six Months Ended June 30,
20262025
(In thousands)
Revenues$8,905,711 $8,681,952 
Expenses$8,136,697 $7,905,294 
Net income$497,581 $344,825 
Net income attributable to MGM$417,569 $197,505 
Long-term Investments
Long-term investments consist of:
June 30, 2026December 31, 2025
(In thousands)
Equity securities without readily determinable fair values$404,628 $409,240 
Total long-term investments$404,628 $409,240 
Equity Securities without Readily Determinable Fair Values
The following table presents a summary of unrealized pre-tax gains and losses recorded in “Other income, net” in the statement of operations as adjustments to the carrying value of equity securities without readily determinable fair values held at June 30, 2026 and 2025.
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
(In thousands)
Downward adjustments including impairments (gross unrealized pre-tax losses)— (10,900)$(4,612)$(28,945)
Total$— $(10,900)$(4,612)$(28,945)
The cumulative upward and downward adjustments (including impairments) to the carrying value of equity securities without readily determinable fair values held at June 30, 2026 were $31.4 million and $175.6 million, respectively.
Realized and unrealized pre-tax gains and losses for the Company’s investments without readily determinable fair values for the three and six months ended June 30, 2026 and 2025 are as follows:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
(In thousands)
Realized pre-tax gains, net, for equity securities sold$— $473 $38 $9,777 
Unrealized pre-tax losses, net, on equity securities held— (10,900)(4,612)(28,945)
Net pre-tax losses recognized$— $(10,427)$(4,574)$(19,168)
All pre-tax gains and losses on equity securities without readily determinable fair values, realized and unrealized, are recognized in “Other income, net” in the statement of operations.
Fair Value Measurements
The Company categorizes its financial instruments measured at fair value into a fair value hierarchy that prioritizes the inputs used in pricing the asset or liability. The three levels of the fair value hierarchy are:
•Level 1: Observable inputs obtained from independent sources, such as quoted market prices for identical assets and liabilities in active markets.
•Level 2: Other inputs, which are observable directly or indirectly, such as quoted market prices for similar assets or liabilities in active markets, quoted market prices for identical or similar assets or liabilities in markets that are not active and inputs that are derived principally from or corroborated by observable market data. The fair values of the Company’s Level 2 financial assets are primarily obtained from observable market prices for identical underlying securities that may not be actively traded. Certain of these securities may have different market prices from multiple market data sources, in which case an average market price is used.
•Level 3: Unobservable inputs for which there is little or no market data and require the Company to develop its own assumptions, based on the best information available in the circumstances, about the assumptions market participants would use in pricing the assets or liabilities.
The following tables present the Company’s financial instruments that are measured at fair value on a recurring basis:
June 30, 2026
Level 1Level 2Level 3Total Fair Value
Measurements
(In thousands)
Assets:
Cash equivalents:
Money market funds$726,812 $— $— $726,812 
Time deposits— 19,937 — 19,937 
Investment in MGM 3,194,777 — — 3,194,777 
Other current assets:
Interest rate swaps(a)
— 239 — 239 
Total$3,921,589 $20,176 $— $3,941,765 
_____________________
(a)    The fair value of interest rate swaps was determined using discounted cash flows derived from observable market prices, including swap curves, which are Level 2 inputs. See “Note 3—Long-term Debt” for additional information.
December 31, 2025
Level 1Level 2Level 3Total Fair Value
Measurements
(In thousands)
Assets:
Cash equivalents:
Money market funds$739,891 $— $— $739,891 
Time deposits— 20,689 — 20,689 
Investment in MGM2,401,858 — — 2,401,858 
Total$3,141,749 $20,689 $— $3,162,438 
Liabilities:
Other long-term liabilities:
Interest rate swaps(a)
$— $(2,018)$— $(2,018)
Assets measured at fair value on a nonrecurring basis
The Company’s non-financial assets, such as goodwill, intangible assets, ROU assets, buildings, equipment, leasehold improvements and capitalized software, are adjusted to fair value only when an impairment is recognized. The Company's financial assets, comprising equity securities without readily determinable fair values, are adjusted to fair value when observable price changes for similar or identical securities are identified or an impairment is recognized. Such fair value measurements are based predominantly on Level 3 inputs.
Financial instruments measured at fair value only for disclosure purposes
The total fair value of the outstanding long-term debt, including the current portion, is estimated using observable market prices or indices for similar liabilities, which are Level 2 inputs, and was approximately $1.35 billion and $1.33 billion at June 30, 2026 and December 31, 2025, respectively.