Financial Analysis

"(14) Commitments and Contingencies Litigation QVC Group has contingent liabilities related to legal and tax proceedings and other matters arising in the ordinary course of business. Although it is reasonably possible QVC Group may incur losses upon conclusion of such matters, an estimate of any loss or range of loss cannot be made. In the opinion of management, it is expected that amounts, if any, which may be required to satisfy such contingencies will not be material in relation to the accompanying consolidated financial statements. HSN Settlement Agreement In October 2023, HSN entered into a settlement agreement with the Consumer Product Safety Commission (CPSC) in which HSN agreed to pay a civil penalty to settle the CPSCs claims in relation to certain handheld clothing steamers sold by HSN that were subject to a voluntary recall previously announced in 2021. In January 2024, HSN received a grand jury subpoena from the U.S. Attorney for the Central District of California that was issued in connection with an official criminal investigation into the clothing steamer matter. QVC has cooperated (and intends to continue cooperating) fully with this investigation, and at this time, QVC is unable to predict the eventual scope, duration or outcome of this investigation, nor is it able to reasonably estimate any range of loss or possible loss. Fire at Rocky Mount Fulfillment Center On December 18, 2021, QVC experienced a fire at its Rocky Mount fulfillment center in North Caroli …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

"(6) Debt Debt is summarized as follows: Outstanding principal December 31, 2025 Carrying value December 31, 2025 December 31, 2024 amounts in millions Corporate level debentures 8.5% Senior Debentures due 2029 $ 287 286 286 8.25% Senior Debentures due 2030 505 503 503 4% Exchangeable Senior Debentures due 2029 (1)(2)(3) 339 24 128 3.75% Exchangeable Senior Debentures due 2030 (1)(2)(3) 427 28 154 Subsidiary level notes and facilities QVC 4.45% Senior Secured Notes due 2025 (3) 585 QVC 4.75% Senior Secured Notes due 2027 (2) 44 44 44 QVC 4.375% Senior Secured Notes due 2028 (2) 72 72 72 QVC 6.875% Senior Secured Notes due 2029 (2) 605 605 605 QVC 5.45% Senior Secured Notes due 2034 (2) 400 400 400 QVC 5.95% Senior Secured Notes due 2043 (2) 300 300 300 QVC 6.375% Senior Secured Notes due 2067 (2) 225 225 225 QVC 6.25% Senior Secured Notes due 2068 (2) 500 500 500 QVC Senior Secured Credit Facility (2) 2,900 2,900 1,195 Finance lease obligations 2 2 Deferred loan costs (2) (24) (29) Total consolidated QVC Group debt $ 6,606 5,865 4,968 Less current classification (5,075) (867) Total long-term debt $ 790 4,101 _________________________________ (1) Measured at fair value (2) Classified as current as of December 31, 2025 (3) Classified as current as of December 31, 2024 Covenant Compliance As noted in note 1, as of December 31, 2025 QVC is not in compliance with the net leverage ratio, as calculated under the Credit Facility. Under the terms of the Fifth Amended and Restated Cred …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

Disaggregated revenue by segment and product category consisted of the following: Year ended December 31, 2025 QxH QVC Int'l CBI Corp and other Total amounts in millions Home $ 2,389 956 770 4,115 Apparel 1,094 422 167 1,683 Beauty 883 545 1,428 Accessories 708 206 914 Electronics 441 66 507 Jewelry 273 161 434 Other revenue 148 1 149 Total Revenue $ 5,936 2,357 937 9,230 Year ended December 31, 2024 QxH QVC Int'l CBI Corp and other Total amounts in millions Home $ 2,626 975 864 4,465 Apparel 1,177 418 176 1,771 Beauty 1,010 566 1,576 Accessories 799 208 1,007 Electronics 539 69 608 Jewelry 293 161 454 Other revenue 154 2 156 Total Revenue $ 6,598 2,399 1,040 10,037 Year ended December 31, 2023 QxH QVC Int'l CBI Corp and other Total amounts in millions Home $ 2,768 982 984 76 4,810 Apparel 1,207 436 181 113 1,937 Beauty 1,083 588 14 1,685 Accessories 846 208 79 1,133 Electronics 617 68 2 687 Jewelry 304 165 11 480 Other revenue 170 7 6 183 Total Revenue $ 6,995 2,454 1,165 301 10,915 …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

"(11) Stock-Based Compensation The Company has granted to certain of its directors, employees and employees of its subsidiaries, restricted stock (""RSAs""), restricted stock units (RSUs), performance restricted stock units (PSUs), performance cash awards and options to purchase shares of the Companys common stock (collectively, ""Awards""). The Company measures the cost of employee services received in exchange for an equity classified Award (such as stock options and RSAs) based on the grant-date fair value (GDFV) of the Award, and recognizes that cost over the period during which the employee is required to provide service (usually the vesting period of the Award). The Company measures the cost of employee services received in exchange for a liability classified Award based on the current fair value of the Award, and remeasures the fair value of the Award at each reporting date. In connection with the Reverse Stock Split, each QVCGA RSU, PSU and deferred stock unit (DSU) outstanding immediately prior to the effective time: i. was divided by the ratio of 1-for-50 and rounded down to the nearest whole RSU, PSU or DSU, and ii. cash was issued in lieu of fractional RSUs, PSUs or DSUs. Also in connection with the Reverse Stock Split, each QVCGA and QVCGB stock option and stock appreciation right (SAR) outstanding immediately prior to the effective time: i. was divided by the ratio of 1-for-50 and rounded down to the nearest whole stock option or SAR, and ii. the corresponding e …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

"(4) Assets and Liabilities Measured at Fair Value For assets and liabilities required to be reported at fair value, GAAP provides a hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three broad levels. Level 1 inputs are quoted market prices in ""active markets"" for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs, other than quoted market prices included within Level 1, that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. The Company measures the fair value of money market funds based on quoted prices in active markets for identical assets. Money market funds are included as cash equivalents Level 1 fair value instruments in the table below. The Company's Level 2 financial liabilities are debt instruments with quoted market prices that are not considered to be traded on ""active markets,"" as defined in GAAP. The fair values for such instruments are derived from a typical model using observable market data as the significant inputs. Accordingly, these financial instruments are reported in the below table as Level 2 fair value instruments. The Companys assets and liabilities measured at fair value on a recurring basis were as follows: December 31, 2025 December 31, 2024 Description Total Quoted prices in active markets for identical assets (Level 1) Significant other ob …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

(5) Intangible Assets Goodwill Changes in the carrying amount of goodwill are as follows: QxH QVC International CBI Corporate and Other amounts in millions Balance at January 1, 2024 $ 2,367 785 12 3,164 Impairment (902) (902) Exchange rate fluctuations (45) (45) Balance at December 31, 2024 1,465 740 12 2,217 Impairment (1,465) (12) (1,477) Exchange rate fluctuations 60 60 Balance at December 31, 2025 $ 800 800 Intangible Assets Other intangible assets consist of the following: December 31, 2025 December 31, 2024 Gross carrying amount Accumulated amortization Intangible assets, net Gross carrying amount Accumulated amortization Intangible assets, net Weighted average remaining life (years) amounts in millions Purchased and internally developed software $ 1,230 (1,015) 215 1,195 (943) 252 2 Affiliate and customer relationships 2,835 (2,788) 47 2,816 (2,722) 94 1 Television distribution rights 161 (93) 68 535 (489) 46 1 Other 54 (48) 6 46 (36) 10 2 Intangible assets subject to amortization $ 4,280 (3,944) 336 4,592 (4,190) 402 Tradenames (indefinite life) $ 1,190 1,190 2,120 2,120 N/A As of December 31, 2025, QVC Group expects that amortization expense will be as follows for the next five years (amounts in millions): 2026 $ 225 2027 76 2028 33 2029 2 2030 Impairment of goodwill and intangible assets As a result of recent financial performance, macroeconomic conditions, declines in stock price and credit rating downgrades, it was determined during the second quarter of 2025 tha …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

"(8) Income Taxes Income tax benefit (expense) consists of: Years ended December 31, 2025 2024 2023 amounts in millions Current: Federal $ 8 (86) (8) State and local 19 (6) 12 Foreign (72) (78) (84) (45) (170) (80) Deferred: Federal 210 172 (50) State and local 23 42 (3) Foreign (3) (3) (27) 230 211 (80) Income tax benefit (expense) $ 185 41 (160) The following table presents a summary of our domestic and foreign earnings (losses) from continuing operations before income taxes: Years ended December 31, 2025 2024 2023 amounts in millions Domestic $ (2,757) (1,525) (236) Foreign 174 234 302 Total $ (2,583) (1,291) 66 Total Income tax benefit (expense) differs from the amounts computed by applying the U.S. federal income tax rate of 21% in 2025 as a result of the following: Year ended December 31, 2025 amounts in millions percent US Federal statutory income tax rate $ 542 21.0 % Domestic federal Tax credits 5 0.2% Nontaxable and non-deductible items, net Goodwill impairment (310) (12)% Other non-deductible items (36) (1.4)% Cross-border tax laws (23) (0.9)% Valuation Allowance - FTC C/F (11) (0.4)% Other 6 0.2% Domestic state and local income taxes, net of federal tax effect (1) 25 1.0 % Foreign tax effects (13) (0.5) % Worldwide changes in unrecognized tax benefits % Total tax benefit (expense) $ 185 7.2 % (1) The following jurisdictions make up greater than 50% of the state income tax expense for 2025: California and New York. For the year ended December 31, 2025, income tax b …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

(7) Leases Right-of-use assets and lease liabilities are initially recognized based on the present value of the future lease payments over the expected lease term. As for most leases the implicit rate is not readily determinable, the Company uses a discount rate in determining the present value of future payments based on the Companys incremental borrowing rate on a collateralized basis aligning with the term of the lease. Our lease agreements include both lease and non-lease components, which the Company accounts for as a single lease component. The Companys leases have base rent periods and some with optional renewal periods. Leases with base rent periods of less than 12 months are not recorded on the balance sheet. For purposes of measurement of lease liabilities, the expected lease terms may include renewal options when it is reasonably certain that the Company will exercise such options. Leases with an initial term greater than twelve months are classified as either finance or operating. Finance leases are generally those that we substantially use or pay for the entire asset over its estimated useful life and are recorded in property and equipment. All other leases are categorized as operating leases and recorded in operating lease right-of-use assets. We have entered into sale leaseback transactions. To determine whether the transaction should be accounted for as a sale, we evaluate whether control of the asset has transferred to a third party. If the transfer of the as …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

New Accounting Pronouncements Not Yet Adopted In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses , which expands disclosures about specific expense categories at interim and annual reporting periods. The standard is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is in the process of evaluating the impact of the new standard on the related disclosures. In July 2025, the FASB issued ASU 2025-05, Financial InstrumentsCredit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets , which simplifies the estimation of expected credit losses for certain current receivables and contract assets under the CECL model, particularly those arising from revenue contracts under ASC 606. The standard is effective for fiscal years beginning after December 15, 2025, and interim reporting periods within those fiscal years. Prospective application of the new guidance is required. The Company will adopt this new standard as of January 1, 2026 and does not expect it to have a material impact on its consolidated financial statements. In September 2025 the FASB issued ASU 2025-06, IntangiblesGoodwill and OtherInternal-Use …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

(10) Related Party Transactions with Officers and Directors Chairman Compensation Arrangement In December 2019, LMC entered into a new employment arrangement with Gregory B. Maffei, our Chairman. The arrangement provided for a five year employment term which began on January 1, 2020 and ended December 31, 2024, with an annual base salary of $3 million (with no contracted increase), a one-time cash commitment bonus of $5 million (paid in December 2019), an annual target cash performance bonus of $17 million (with payment subject to the achievement of one or more performance metrics as determined by the applicable companys Compensation Committee), upfront equity awards and annual equity awards (as described below). The Chairman was entitled to receive term equity awards with an aggregate GDFV of $90 million (the Upfront Awards) which were granted in two equal tranches. The first tranche consisted of time-vested stock options from each of QVC Group, LMC, Liberty Broadband and GCI Liberty and time-vested restricted stock units (RSUs) from Liberty TripAdvisor Holdings, Inc. (Liberty TripAdvisor) (collectively, the 2019 term awards) that vested, in each case, on December 31, 2023 (except Liberty TripAdvisors award of time-vested RSUs, which vested on December 15, 2023). The second tranche of the Upfront Awards consisted of time-vested stock options from each of LMC, QVC Group, Liberty Broadband and GCI Liberty and time-vested RSUs from Liberty TripAdvisor (collectively, the 2020 te …

RelatedPartyTransactionsDisclosureTextBlock · excerpt; the full note is in the filing

(15) Information About QVC Group's Operating Segments QVC Group, through its ownership interests in subsidiaries and other companies, is primarily engaged in the video and on-line commerce industries. QVC Group identifies its reportable segments as (A) those operating segments that represent 10% or more of its consolidated annual revenue, annual Adjusted OIBDA or total assets and (B) those equity method affiliates whose share of earnings represent 10% or more of QVC Group's annual pre-tax earnings. The segment presentation for prior periods has been conformed to the current period segment presentation. QVC Groups chief operating decision maker, the chief executive officer, evaluates performance and makes decisions about allocating resources to its operating segments based on financial measures such as revenue, cost of goods sold, gross profit, operating expense, advertising expense, SG&A and Adjusted OIBDA, in addition to average sales price per unit, number of units shipped and revenue or sales per customer equivalent. In addition, QVC Group reviews nonfinancial measures such as unique website visitors, conversion rates and active customers, as appropriate. For segment reporting purposes, QVC Group defines Adjusted OIBDA as revenue less cost of goods sold, operating expenses, and SG&A excluding stock-based compensation and, where applicable, separately identified items impacting comparability . QVC Group believes this measure is an important indicator of the operatio …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

"(2) Summary of Significant Accounting Policies Cash and Cash Equivalents Cash equivalents consist of investments which are readily convertible into cash and have maturities of three months or less at the time of acquisition. Restricted Cash Restricted cash as of December 31, 2025 primarily includes cash deposits to cover potential disputes or other financial obligations with certain counterparties and a cash deposit with a third party trustee that provides financial assurance that the Company will fulfill its obligations in relation to claims under its workers' compensation policy. Restricted cash as of December 31, 2024 primarily includes the above noted cash deposit with a third party trustee. Trade Receivables Trade and Other Receivables from major credit cards represents amounts owed to QVC Group from the credit card clearing houses for amounts billed but not yet collected. Trade and Other Receivables consisted of the following: December 31, (in millions) 2025 2024 Installment payment option $ 816 946 Major credit cards and customers 179 205 Trade accounts receivable 995 1,151 Other receivables 124 83 Trade and other receivables 1,119 1,234 Less: allowance for credit losses (79) (91) Trade and other receivables, net $ 1,040 1,143 Trade receivables are reflected net of sales returns. A provision for credit losses is provided as a percentage of accounts receivable based on historical experience in the period of sale and included in selling, general and administrative expen …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

(9) Preferred and Common Stock On September 14, 2020 , QVC Group issued its Preferred Stock. There were 13,500,000 shares of Preferred Stock authorized and 12,723,158 shares and 12,723,258 shares issued and outstanding at December 31, 2025 and 2024 , respectively. Priority . The Preferred Stock ranks senior to the shares of QVC Group common stock, with respect to dividend rights, rights of redemption and rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of QVC Groups affairs. Shares of Preferred Stock are not convertible into shares of QVC Group common stock. Dividends . Holders of the Preferred Stock are entitled to receive quarterly cash dividends at a rate of 8.0% per annum of the liquidation price (as described below) on a cumulative basis, during the term. If declared, accrued dividends will be payable quarterly on each dividend payment date, beginning December 15, 2020 and thereafter on each March 15, June 15, September 15, and December 15 during the term (or, if such date is not a business day, the next business day after such date). If QVC Group fails to pay dividends or the applicable redemption price with respect to any redemption within 30 days after the applicable dividend payment or redemption date, the dividend rate will increase as provided by the Certificate of Designations for the Preferred Stock (the Certificate of Designations). Accrued dividends that are not paid within 30 days after the applicable …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing