Alliance Entertainment Holding Corp 10-K for FY2026

Alliance Entertainment Holding Corp (AENT)

10-K 2026-09-10 For: 2026-06-30

Added on September 10, 2026

About this 10-K

Alliance Entertainment Holding Corp filed this 10-K on September 10, 2026, covering the fiscal year ended June 30, 2026 (FY2026).

Headline figures

Fiscal year ended June 30, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $2.7M; unchanged from $2.7M a year earlier
Net income: $13.06M; down 13.4% from net income of $15.08M a year earlier
Diluted EPS: $0.26; down 13.3% from $0.30 a year earlier

Search and read filings like this one from Claude or ChatGPT with the SEC filings MCP server →

Title:	Trading Symbol	Name of Exchange on which registered
Class A common stock, par value $0.0001 per share	AENT	The Nasdaq Stock Market LLC
Redeemable warrants, exercisable for shares of Class A common stock at an exercise price of $11.50 per share	AENTW	The Nasdaq Stock Market LLC

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

			Page
Part I.
	Item 1.	Business	1
	Item 1A.	Risk Factors.	12
	Item 1B.	Unresolved Staff Comments.	41
	Item 1C.	Cybersecurity	41
	Item 2.	Properties	41
	Item 3.	Legal Proceedings	41
	Item 4.	Mine Safety Disclosure	42
Part II.
	Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.	43
	Item 6.	[Reserved]	43
	Item 7.	Management’s Discussion and Analysis Of Financial Condition and Results Of Operations	43
	Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	56
	Item 8.	Financial Statements and Supplementary Data	56
	Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	56
	Item 9A.	Controls and Procedures	56
	Item 9B	Other Information.	57
Part III.
	Item 10	Directors, Executive Officers and Corporate Governance.	57
	Item 11	Executive Compensation.	63
	Item 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.	69
	Item 13	Certain Relationships and Related Transactions.	70
	Item 14	Principal Accountant Fees and Services.	72
Part IV.
	Item 15	Exhibits, Financial Statement Schedules.	72
	Item 16	Form 10-K Summary.	75
SIGNATURES			76

	●	Risks related to market acceptance and growth opportunities.
	●	Potential changes in laws or regulations.
	●	Supply chain disruptions and increased costs.
	●	Dependence on key suppliers and customers.
	●	Risks related to our significant indebtedness and compliance with debt covenants.
	●	Litigation and regulatory risks.
	●	Economic factors such as inflation and interest rates.
	●	Challenges in retaining key personnel.
	●	Cybersecurity threats and IT infrastructure issues.
	●	Environmental, safety, and product liability concerns.
	●	Risks related to potential acquisitions.
	●	Changes in U.S. tax laws.
	●	Risks related to international trade policies and tariffs.

	■	Alliance Home Entertainment, the exclusive distributor of Paramount Pictures’ physical media content as of January 1, 2025, and of Amazon MGM Studios’ physical media content as of January 1, 2026, offering full-service support across production, marketing, and retail execution.

	■	Handmade by Robots, In December 2024, the Company acquired Handmade by Robots (“HMBR”), a designer of licensed vinyl collectible figures, for approximately $7.55 million in a transaction accounted for as a business combination under ASC 805. See Note 16 – Business Combinations and Asset Purchase.
	■	Alliance Authentic, a new division focused on licensed collectibles and branded merchandise, including partnerships with Handmade by Robots, Master Replicas, and Wētā Workshop.

	●	Gaming Products: For the fiscal year ended June 30, 2026, gaming represented approximately 16% of Alliance revenues on a consolidated basis. Leading products distributed are Nintendo, Microsoft, and third-party video game publishers. For the year ended June 30, 2025, gaming represented approximately 24% of Alliance revenues on a consolidated basis.

	●	Vinyl Records: For the fiscal year ended June 30, 2026, vinyl represented approximately 33% of all Company revenues on a consolidated basis. For the year ended June 30, 2025, vinyl represented approximately 32% of Alliance revenues on a consolidated basis.

	●	Digital Video Discs (DVD)/Blu-Ray/UltraHD: Sales for the fiscal year ended June 30, 2026, represented approximately 30% of Alliance’s consolidated revenue. For the year ended June 30, 2025, DVD, Blu-Ray and UltraHD represented approximately 26% of Alliance revenues on a consolidated basis.

	●	Compact Discs: CDs for the fiscal year ended June 30, 2026, represent approximately 14% of Alliance’s consolidated revenue. For the year ended June 30, 2025, CDs represented approximately 12% of Alliance revenues on a consolidated basis.

	●	Collectables and Electronics: Sales in Collectables and Consumer Electronics represented approximately 4% of the Company consolidated revenue for the fiscal year ended June 30, 2026, and approximately 4% of Alliance revenues on a consolidated basis for the year ended June 30, 2025.

	●	Advanced product search and personalized selection tools

	●	Integrated Hubspot marketing and customer relationship management (CRM) tools supporting multi-channel retailer marketplaces. Hubspot with its AI tools was installed and working as Februry 2026.

	●	Conversational commerce and Fintech solutions providing diverse payment options

	●	Self-service purchasing and 24/7 customer support

	●	Packaged Goods consisting of licensed physical media and entertainment content;

	●	Gaming Consoles and Accessories; and

	●	Licensed Toys and Collectables.

	●	Proven Management Team with Significant Ownership Alignment. Senior management has more than 30 years of industry experience and maintains significant ownership in the Company, aligning management’s interests with those of stockholders.

	●	Significant barriers to entry and market leadership. Alliance is a leader in fulfillment and e-commerce distribution with over 340,000 SKUs in stock. The company’s market leadership is further protected by a three-pronged moat of services, selection, and technology. The company’s platforms create efficiencies that benefit its partners in the physical media and entertainment marketplace. As a result, both suppliers and retail customers rely on the company’s platforms to drive transaction volume.

	●	Strategic Partnerships with Major Content Providers. Through Alliance Home Entertainment, the Company has established strong distribution relationships with major studios and independent content owners. Most recently, the Company secured exclusive physical media distribution agreements with Paramount Home Entertainment and Amazon MGM Studios, reinforcing Alliance’s role as a key physical media partner and unlocking new growth opportunities within the home entertainment segment.

	●	Expansion into Premium Collectibles and Licensed Merchandise Alliance Authentic, the Company’s newest division, is focused on delivering curated, premium collectible products through exclusive licensing partnerships and proprietary brands. This leverages Alliance’s core distribution infrastructure and deep relationships in entertainment to capitalize on the growing demand for pop culture merchandise.

	●	Organic Growth Opportunities. Alliance will seek to grow revenue and expand margins through the expansion of partnerships with vendors and customers and investment in existing facilities.

	●	Proven track record of building scale through significant acquisitions. Since its inception, Alliance has successfully acquired and integrated sixteen businesses that have greatly expanded the vendors and customers we are supporting. This M&A activity has built scale and added capabilities to the Company’s platforms. Further, Alliance has demonstrated an ability to integrate those companies into its existing platforms to fundamentally improve the acquired businesses. Alliance management believes significant consolidation opportunities remain to drive future growth by acquiring complementary businesses and competitors.

	●	Modern technology distribution platform and interface. The Company’s technology platform increases transaction efficiency, provides great mobile accessibility, and incorporates modern marketing and Fintech tools.

	●	Execute Acquisition Strategy. Alliance has a proven track record of successfully acquiring and integrating competitors and complementary businesses. With additional capital, Alliance will be able to execute its acquisition strategy more effectively.

	●	Increase Market Share. Expanding its existing product and service offerings and executing its acquisition strategy will drive Alliance’s efforts toward increasing market share. The Company has historically built scale and added capabilities through acquisitions. It has demonstrated an ability to execute accretive and synergistic acquisitions as well as integrate and fundamentally improve the acquired businesses. Alliance expects to continue pursuing strategic opportunities that strengthen its platforms, expand the breadth and depth of its content, and enhance its distribution infrastructure. Alliance will continue to actively monitor and evaluate these and future opportunities in its acquisition pipeline in both the near and mid-term.

	●	Enhance Direct to Consumer (DTC) Relationships and Capabilities. Alliance’s DTC services are in greater demand as consumer preferences shift and stress retailers’ e-commerce and DTC capabilities. Enhancing DTC relationships will grow existing revenue lines and improving capabilities will generate a more attractive overall service offering.

	●	Expand into New Consumer Products. Leveraging existing relationships, Alliance can expand into new consumer product segments, growing its product offering and providing more to its existing customer base while attracting new customers in the process.

	●	Continuing Technological Advancement. Alliance will further invest in automating facilities and upgrading proprietary software.

		Capitalize on Strategic Studio Partnerships. Building on our exclusive distribution agreements with Paramount Home Entertainment and Amazon MGM Studios through Alliance Home Entertainment, we intend to develop additional studio partnerships to expand our footprint in the physical media market.

	●	If Alliance fails to respond to or capitalize on the rapid technological development in the music, video, gaming, and entertainment industry, including changes in entertainment delivery formats, its business could be harmed.

	●	If Alliance does not successfully optimize and operate its fulfillment network, its business could be harmed.

	●	Disruptions in Alliance’s supply chain have increased product expenditures and could result in an adverse impact on results of operations.

	●	Inflation could cause Alliance’s product costs and operating and administrative expenses to grow more rapidly than net sales, which could result in lower gross margins and lower net earnings.

	●	Weakness in the economy, market trends and other conditions affecting the profitability and financial stability of Alliance’s customers could negatively impact Alliance’s sales growth and results of operations.

	●	Our expansion places a strain on our management, operational, financial, and other resources.

	●	Our expansion into new products, services, technologies, and geographic regions subjects us to additional business, legal, financial, and competitive risks;

	●	Our business will suffer if we are not successful in developing and expanding our partner brands across our consumer base.

	●	Consumer interests change rapidly and acceptance of products and entertainment offerings are influenced by outside factors;

	●	If we are unable to navigate through global supply chain challenges, our business may be harmed;

	●	If we are unable to adapt our business to the continued shift to ecommerce, our business may be harmed;

	●	Our business, including our costs and supply chain, is subject to risks associated with sourcing, manufacturing, warehousing, distribution and logistics, and the loss of any of our key suppliers or service providers could negatively impact our business;

	●	We face significant inventory risk;

	●	We rely on third-party suppliers, labels, studios, publishers, suppliers, retail and ecommerce partners and other vendors, and they may not continue to produce products or provide services that are consistent with our standards or applicable regulatory requirements, which could harm our brand, cause consumer dissatisfaction, and require us to find alternative suppliers of our products or services;

	●	Alliance’s existing and any future indebtedness could adversely affect its ability to operate its business;

	●	Covenants and events of default under Alliance’s Credit Agreement could limit our ability to undertake certain types of transactions and adversely affect our liquidity;

	●	Our indebtedness may limit our availability of cash, cause us to divert cash to fund debt service payments or make it more difficult to take certain other actions;

	●	If we were unable to obtain or service our other external financings, or if the restrictions imposed by such financing were too burdensome, our business would be harmed;

	●	We might not be able to maintain the listing of our Class A common stock on the Nasdaq Capital Market;

	●	We are subject to risks arising from international trade policies, including the imposition of new or increased tariffs on imported goods.

	●	our ability to retain and increase sales to existing customers, attract new customers, and satisfy our customers’ demands;

	●	our ability to retain and expand our network of customers;

	●	our ability to offer products on favorable terms, manage inventory, and fulfill orders;

	●	the introduction of competitive stores, websites, products, services, price decreases, or improvements;

	●	changes in usage or adoption rates of the Internet, e-commerce, electronic devices, and web services, including outside the U.S.;

	●	timing, effectiveness, and costs of expansion and upgrades of our systems and infrastructure;

	●	the success of our geographic, service, and product line expansions;

	●	the extent to which we finance, and the terms of any such financing for, our current operations and future growth;

	●	the outcomes of legal proceedings and claims, which may include significant monetary damages or injunctive relief and could have a material adverse impact on our operating results;

	●	variations in the mix of products and services we sell;

	●	variations in our level of merchandise and vendor returns;

	●	the extent to which we offer free shipping, continue to reduce prices worldwide, and provide additional benefits to our customers;

	●	factors affecting our reputation or brand image;

	●	the extent to which we invest in technology and content, fulfillment, and other expense categories;

	●	increases in the prices of fuel and gasoline, as well as increases in the prices of other energy products and commodities like paper and packing supplies;

	●	the extent to which our equity-method investees record significant operating and non-operating items;

	●	the extent to which operators of the networks between our customers and our stores successfully charge fees to grant our customers unimpaired and unconstrained access to our online services;

	●	our ability to collect amounts owed to us when they become due;

	●	the extent to which use of our services is affected by spyware, viruses, phishing and other spam emails, denial of service attacks, data theft, computer intrusions, outages, and similar events;

	●	terrorist attacks and armed hostilities;

	●	supply chain issues either in chip shortages; and

	●	long lead time in the manufacturing vinyl LP’s.

	●	local economic and political conditions;

	●	government regulation and compliance requirements (such as regulation of our product and service offerings and of competition), restrictive governmental actions (such as trade protection measures, including export duties and quotas and custom duties and tariffs), nationalization, and restrictions on foreign ownership;

	●	restrictions on sales or distribution of certain products or services and uncertainty regarding liability for products, services, and content, including uncertainty as a result of less Internet- friendly legal systems, local laws, lack of legal precedent, and varying rules, regulations, and practices regarding the physical and digital distribution of media products and enforcement of intellectual property rights;

	●	business licensing or certification requirements, such as for imports, exports, web services, and electronic devices;

	●	limitations on the repatriation and investment of funds and foreign currency exchange restrictions;

	●	limited fulfillment and technology infrastructure;

	●	shorter payable and longer receivable cycles and the resultant negative impact on cash flow;

	●	laws and regulations regarding consumer and data protection, privacy, network security, encryption, payments, and restrictions on pricing or discounts;

	●	lower levels of consumer spending and fewer opportunities for growth compared to the U.S.;

	●	lower levels of credit card usage and increased payment risk;

	●	difficulty in staffing, developing, and managing foreign operations as a result of distance, language, and cultural differences.

	●	different employee/employer relationships and the existence of works councils and labor unions;

	●	compliance with the U.S. Foreign Corrupt Practices Act and other applicable U.S. and foreign laws prohibiting corrupt payments to government officials and other third parties;

	●	laws and policies of the U.S. and other jurisdictions affecting trade, foreign investment, loans, and taxes; and

	●	geopolitical events, including war and terrorism.

	●	have economic or business interests or goals that are inconsistent with ours;

	●	take actions contrary to our instructions, requests, policies, or objectives;

	●	be unable or unwilling to fulfill their obligations under relevant purchase orders, including obligations to meet our production deadlines, quality standards, pricing guidelines and product specifications, and to comply with applicable regulations, including those regarding the safety and quality of products;

	●	have financial difficulties;

	●	encounter raw material or labor shortages;

	●	encounter increases in raw material or labor costs which may affect our procurement costs;

	●	encounter difficulties with proper payment of custom duties or excise taxes;

	●	disclose our confidential information or intellectual property to competitors or third parties;

	●	engage in activities or employ practices that may harm our reputation; and

	●	work with, be acquired by, or come under control of, our competitors.

	●	Requiring us to dedicate a portion of our cash resources to the payment of interest and principal, reducing money available to fund working capital, capital expenditures, potential acquisitions, international expansion, new product development, new enterprise relationships and other general corporate purposes;

	●	Increasing our vulnerability to adverse changes in general economic, industry and market conditions;

	●	Subjecting us to restrictive covenants that may reduce our ability to take certain corporate actions or obtain further debt or equity financing;

	●	Limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we compete; and placing us at a competitive disadvantage compared to our competitors that have less debt or better debt servicing options.

	●	make it more difficult and/or costly for us to pay or refinance our debts as they become due, particularly during adverse economic and industry conditions, because a decrease in revenues or increase in costs could cause cash flow from operations to be insufficient to make scheduled debt service payments;

	●	require a substantial portion of our available cash to be used for debt service payments, thereby reducing the availability of our cash to fund working capital, capital expenditures, development projects, acquisitions or other strategic opportunities, dividend payments, share repurchases and other general corporate purposes;

	●	make it more difficult for us to raise capital to fund working capital, make capital expenditures, pay dividends, pursue strategic initiatives or for other purposes and result in higher interest expense, which could be further increased in case of current or future borrowings subject to variable rates of interest;

	●	require that materially adverse terms, conditions, or covenants be placed on us under our debt instruments, which could include, for example, limitations on additional borrowings or limitations on our ability to create liens, pay dividends, repurchase our common stock or make investments, any of which could hinder our access to capital markets or our flexibility in the conduct of our business and make us more vulnerable to economic downturns and adverse competitive industry conditions; and

	●	jeopardize our ability to pay our indebtedness if our business experienced a severe downturn.

	●	Our ability or inability to generate revenues or profit.

	●	The relatively small number of shares in our public float, which could exacerbate stock price volatility.

	●	Increased competition.

	●	a prohibition on actions by its stockholders except at an annual or special meeting of stockholders.

	●	a prohibition on actions by its stockholders by written consent; and

	●	the ability of the board of directors to issue preferred stock without stockholder approval, which could be used to institute a “poison pill” that would work to dilute the stock ownership of a potential hostile acquirer, effectively preventing acquisitions that have not been approved by the board of directors.

	●	may significantly dilute the equity interest of holders of Class A common stock.

	●	may subordinate the rights of holders of shares of common stock if one or more classes of preferred stock are created, and such shares of preferred stock are issued, with rights senior to those afforded to Class A common stock.

	●	could cause a change in control if a substantial number of shares of common stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors; and

	●	may adversely affect prevailing market prices for the Class A common stock and/or Warrants.

	●	Shepherdsville, Kentucky — A 662,087 square foot facility leased for $5.86 per square foot through January 31, 2031. with 3.25% annual increases to base rent. In addition, we retain the right to extend for an additional term of five years at fair market rent.

	●	Shepherdsville, Kentucky (Additional Storage Facility) — We have vacated our previous cold storage building and moved to a new facility that charges $11.00 per pallet with a $14,000 monthly minimum, which equates to 1,273 pallets. This facility can accommodate up to 3,000 skids. There is no time limit set for this agreement

($ in thousands)	Year Ended June 30, 2026		Year Ended June 30, 2025
Net revenues	$	1,148,986	$	1,063,457
Net income	$	13,058	$	15,078
EBITDA (1)	$	31,779	$	34,617
Adjusted EBITDA (1)	$	41,532	$	36,543
Adjusted Net Income (1)	$	23,449	$	18,948

	Year Ended			Year Ended
($ in thousands)	June 30, 2026			June 30, 2025
Net Revenues	$	1,148,986		$	1,063,457
Cost of Revenues (excluding depreciation and amortization)		996,662			930,605
Operating Expenses
Distribution and Fulfillment Expense		44,960			40,375
Selling, General and Administrative Expense		66,169			55,992
Loss on Vendor Receivable		7,823			-
Depreciation and Amortization		5,359			5,334
Transaction Costs		1,213			957
Restructuring Costs		-			73
Insurance Claim Recovery		(395	)		-
Gain on Disposal of Fixed Assets		(24	)		(15	)
Total Operating Expenses		125,105			102,716
Operating Income		27,219			30,136
Other Expenses
Change in Fair Value of Warrants		850			853
State Tax Benefit from Prior Year		(51	)		-
Interest Expense		7,606			10,575
Total Other Expenses		8,405			11,428
Income Before Income Tax Expense		18,814			18,708
Income Tax Expense		5,756			3,630
Net Income		13,058			15,078
Other Comprehensive (loss) income		(1	)		3
Total Comprehensive Income		13,057			15,081

	●	as a measurement of operating performance because they assist us in comparing the operating performance of our business on a consistent basis, as they remove the impact of items not directly resulting from our core operations;
	●	for planning purposes, including the preparation of our internal annual operating budget and financial projections;
	●	to evaluate the performance and effectiveness of our operational strategies; and
	●	to evaluate our capacity to expand our business.

	●	such measures do not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments;
	●	such measures do not reflect changes in, or cash requirements for, our working capital needs;
	●	EBITDA and Adjusted EBITDA do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments on our debt;
	●	although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future and such measures do not reflect any cash requirements for such replacements;
	●	Adjusted Net Income and Adjusted Earnings per Diluted Share exclude amortization of acquisition-related intangible assets, while the revenue generated by those intangible assets is not excluded;
	●	certain of the items excluded in arriving at such measures require settlement in cash, and excluding an item does not reduce the cash we are required to pay in respect of that item; and
	●	other companies in our industry may calculate such measures differently than we do, limiting their usefulness as comparative measures.

	Year Ended			Year Ended
(in thousands, except share and per share data)	June 30, 2026			June 30, 2025
Net income	$	13,058		$	15,078
Equity-based compensation (1)		337			58
Acquisition and deal-related costs (2)		1,213			957
Amortization of acquisition-related intangible assets (3)		390			180
Amortization of deferred financing costs (4)		2,086			1,404
Change in fair value of warrants and contingent consideration (5)		850			853
Loss on Vendor Receivable (6)		7,823			-
Litigation costs and settlements (7)		1,267			1,424
Insurance Claim Recovery (8)		(395	)		—
Income tax effect of adjustments (9)		(3,180	)		(1,006	)
Adjusted net income	$	23,449		$	18,948
Weighted-average shares outstanding—basic		50,963,975			50,957,370
Effect of dilutive securities		87,765			8,600
Weighted-average shares outstanding—diluted		51,051,740			50,965,970
Earnings per diluted share	$	0.26		$	0.30
Adjusted earnings per diluted share	$	0.46		$	0.37

($in millions)	June 30, 2026		June 30, 2025
Revolver Balance	$	74	$	57
Availability		46		54