18.

INCOME TAXES

Holdings

The provision for federal and foreign income tax expense for continuing operations of Holdings consisted of the following:


	Year Ended December 31,
	2023		2024		2025
Income before income taxes:
U.S.	$	151.4	$	173.3	$	87.0
Foreign		70.0		79.5		66.9
Total	$	221.4	$	252.8	$	153.9

Current and deferred income taxes for Holdings were as follows:


	Year Ended December 31,
	2023			2024			2025
Current:
Federal	$	2.2		$	29.9		$	5.1
State		2.9			5.6			4.4
Foreign		14.2			15.2			22.1
Total current expense		19.3			50.7			31.6
Deferred:
Federal	$	15.8		$	(19.9	)	$	(20.0	)
State		0.5			(54.9	)		(11.8	)
Foreign		(5.7	)		(36.0	)		12.6
Total deferred taxes		10.6			(110.8	)		(19.2	)
Total:
Federal	$	18.0		$	10.0		$	(14.9	)
State		3.4			(49.3	)		(7.4	)
Foreign		8.5			(20.8	)		34.7
Income taxes	$	29.9		$	(60.1	)	$	12.4

A reconciliation between Holdings’ income tax expense and taxes computed by applying the applicable statutory federal income tax rate to income before income taxes after the adoption of ASU 2023-09 is as follows:


	Year Ended December 31,
	2025

Computed U.S. federal statutory tax expense	$	32.3		21.0	%
State and local income taxes, net of federal income tax impact (1)		(5.1	)	(3.3	)%
Foreign tax effects
Argentina:
Statutory tax rate difference between Argentina and U.S.		2.8		1.8	%
Inflation adjustments		1.8		1.2	%
Withholding tax		2.8		1.8	%
Other		0.8		0.5	%
Brazil:
Statutory tax rate difference between Brazil and U.S.		3.4		2.2	%
Other		2.1		1.4	%
Colombia:
Statutory tax rate difference between Colombia and U.S.		1.8		1.2	%
Other		1.4		0.9	%
Other foreign jurisdictions:		3.7		2.4	%
Effect of changes in tax laws or rates enacted in the current period (2)		(46.1	)	(30.0	)%
Effect of cross-border tax laws:
Global intangible low-taxed income		3.4		2.2	%
Foreign-derived intangible income		(1.8	)	(1.2	)%
Unremitted earnings		1.8		1.1	%
Other		(0.3	)	(0.3	)%
Tax Credits:
Foreign tax credits		(10.1	)	(6.6	)%
Other		(1.3	)	(0.8	)%
Changes in valuation allowance		2.8		1.9	%
Nontaxable and nondeductible items:
Nondeductible compensation		4.2		2.7	%
Loss on warrant settlements		8.3		5.4	%
Other		1.5		1.0	%
Other adjustments		2.2		1.5	%
Effective tax rate	$	12.4		8.1	%

(1)

State taxes in Florida and Pennsylvania made up greater than fifty percent of the tax effect.

(2)

Reflects the valuation allowance release related to federal interest expense carryforwards resulting from OBBBA, as defined under Deferred Income Taxes below.

A reconciliation between Holdings’ income tax expense and taxes computed by applying the applicable statutory federal income tax rate to income before income taxes for the periods presented prior to the adoption of ASU 2023-09 is as follows:


	Year Ended December 31,
	2023			2024
Computed statutory tax expense	$	46.5		$	53.1
State and local income taxes, net of federal income tax impact		5.4			7.7
Changes in valuation allowance		(63.9	)		(136.7	)
Foreign tax rate differential		1.4			—
Foreign tax credits		(13.0	)		(4.9	)
Inflation adjustments		(0.3	)		(6.1	)
Nondeductible compensation		2.9			3.9
Changes in uncertain tax positions		(0.9	)		3.1
U.S. tax impact of foreign operations		10.3			9.6
Return to provision		(3.3	)		1.4
Expiration of attribute carryforwards		37.1			3.1
Permanent differences		6.8			7.4
Other, net		0.9			(1.7	)
Income taxes	$	29.9		$	(60.1	)

CUSA

The provision for federal and foreign income tax expense for continuing operations of CUSA consisted of the following:


	Year Ended December 31,
	2023		2024		2025
Income before income taxes:
U.S.	$	167.0	$	188.8	$	142.3
Foreign		70.0		79.5		66.9
Total	$	237.0	$	268.3	$	209.2

Current and deferred income taxes for CUSA were as follows:


	Year Ended December 31,
	2023			2024			2025
Current:
Federal	$	2.8		$	29.5		$	5.9
State		2.9			6.6			5.2
Foreign		14.2			15.2			22.1
Total current expense		19.9			51.3			33.2
Deferred:
Federal	$	13.8		$	(20.3	)	$	25.5
State		0.4			(50.8	)		(10.5	)
Foreign		(5.7	)		(36.0	)		12.5
Total deferred taxes		8.5			(107.1	)		27.5
Total:
Federal	$	16.6		$	9.2		$	31.4
State		3.3			(44.2	)		(5.3	)
Foreign		8.5			(20.8	)		34.6
Income taxes	$	28.4		$	(55.8	)	$	60.7

A reconciliation between CUSA’s income tax expense and taxes computed by applying the applicable statutory federal income tax rate to income before income taxes after the adoption of ASU 2023-09 is as follows:


	Year Ended December 31,
	2025

Computed U.S. federal statutory tax expense	$	43.9		21.0	%
State and local income taxes, net of federal income tax impact (1)		(3.6	)	(1.7	)%
Foreign tax effects
Argentina:
Statutory tax rate difference between Argentina and U.S.		2.8		1.3	%
Inflation adjustments		1.8		0.9	%
Withholding tax		2.8		1.3	%
Other		0.8		0.4	%
Brazil:
Statutory tax rate difference between Brazil and U.S.		3.4		1.6	%
Other		2.1		1.0	%
Colombia:
Statutory tax rate difference between Colombia and U.S.		1.8		0.9	%
Other		1.4		0.7	%
Other foreign jurisdictions:		3.7		1.8	%
Effect of changes in tax laws or rates enacted in the current period (2)		(3.0	)	(1.4	)%
Effect of cross-border tax laws:
Global intangible low-taxed income		3.4		1.6	%
Other		(0.3	)	(0.2	)%
Tax Credits:
Foreign tax credits		(9.1	)	(4.3	)%
Other		(1.3	)	(0.6	)%
Changes in valuation allowance		3.2		1.5	%
Nontaxable and nondeductible items:
Nondeductible compensation		4.2		2.0	%
Other		1.5		0.7	%
Other adjustments		1.2		0.5	%
Effective tax rate	$	60.7		29.0	%

(1)

State taxes in Florida and Pennsylvania made up greater than fifty percent of the tax effect.

(2)

Reflects the valuation allowance release related to federal interest expense carryforwards resulting from OBBBA, as defined under Deferred Income Taxes below.

A reconciliation between CUSA’s income tax expense and taxes computed by applying the applicable statutory federal income tax rate to income before income taxes for the periods presented prior to the adoption of ASU 2023-09 is as follows:


	Year Ended December 31,
	2023			2024
Computed statutory tax expense	$	49.8		$	56.3
State and local income taxes, net of federal income tax impact		5.9			8.1
Changes in valuation allowance		(68.6	)		(134.8	)
Foreign tax rate differential		1.4			—
Foreign tax credits		(12.9	)		(5.9	)
Inflation adjustments		(0.3	)		(6.1	)
Nondeductible compensation		2.8			3.9
Changes in uncertain tax positions		(0.9	)		3.2
U.S. tax impact of foreign operations		10.4			9.4
Return to provision		(3.3	)		1.1
Expiration of attribute carryforwards		36.4			3.2
Permanent differences		6.9			7.4
Other, net		0.8			(1.6	)
Income taxes	$	28.4		$	(55.8	)

As of December 31, 2025, the Company is not indefinitely reinvested with respect to $42.7 of accumulated undistributed earnings of its various subsidiaries. As of December 31, 2025, the Company had approximately $166.2 of accumulated undistributed earnings and profits which it considers to be indefinitely reinvested. Of this indefinitely reinvested amount, approximately $158.9 was subject to the one-time transition tax pursuant to the 2017 Tax Cuts and Jobs Act. Additional tax due on the repatriation of these previously-taxed earnings would generally be foreign withholding and U.S. state income taxes. The Company does not intend to repatriate these offshore earnings and profits, and therefore has not recorded any deferred taxes on such earnings. The Company considers any excess of the amount for financial reporting over the tax basis of its investment in these foreign subsidiaries to be indefinitely reinvested. At this time, the determination of deferred tax liabilities on this amount is not practicable.

Deferred Income Taxes

Holdings

The tax effects of significant temporary differences and tax loss and tax credit carryforwards comprising the net long-term deferred income tax assets for Holdings as of the periods presented consisted of the following:


	December 31,
	2024			2025
Deferred liabilities:
Theater properties and equipment	$	56.7		$	69.8
Finance lease assets		22.4			19.2
Operating lease right-of-use assets		232.6			239.4
Intangible asset – other		57.4			62.5
Intangible asset – tradenames		69.5			69.7
Total deferred liabilities		438.6			460.6
Deferred assets:
Deferred revenue – NCM and other		83.0			81.6
Gift cards		10.8			12.6
Operating lease obligations		249.0			253.5
Finance lease obligations		27.9			24.5
Tax impact of items in accumulated other comprehensive income and additional paid-in-capital		10.3			4.4
Restricted stock		6.1			5.2
Other tax loss carryforwards		65.8			62.3
Other tax credit and attribute carryforwards		167.9			165.5
Other expenses, not currently deductible for tax purposes		13.6			14.7
Total deferred assets		634.4			624.3
Net deferred income tax asset before valuation allowance		(195.8	)		(163.7	)
Valuation allowance against deferred assets – non-current		129.5			74.5
Net deferred income tax asset	$	(66.3	)	$	(89.2	)
Net deferred tax asset – Foreign	$	(32.4	)	$	(22.8	)
Net deferred tax asset – U.S.		(33.9	)		(66.4	)
Total	$	(66.3	)	$	(89.2	)

CUSA

The tax effects of significant temporary differences and tax loss and tax credit carryforwards comprising the net long-term deferred income tax assets for CUSA as of the periods presented consisted of the following:


	December 31,
	2024			2025
Deferred liabilities:
Theater properties and equipment	$	56.6		$	69.7
Finance lease assets		22.4			19.2
Operating lease right-of-use assets		232.3			239.4
Intangible asset – other		57.3			62.5
Intangible asset – tradenames		69.4			69.7
Total deferred liabilities		438.0			460.5
Deferred assets:
Deferred revenue – NCM and other		82.8			81.5
Gift cards		10.8			12.6
Operating lease obligations		248.7			253.5
Finance lease obligations		27.9			24.5
Tax impact of items in accumulated other comprehensive income and additional paid-in-capital		3.5			4.4
Restricted stock		5.9			5.1
Other tax loss carryforwards		63.1			59.5
Other tax credit and attribute carryforwards		128.1			117.0
Other expenses, not currently deductible for tax purposes		13.5			14.7
Total deferred assets		584.3			572.8
Net deferred income tax asset before valuation allowance		(146.3	)		(112.3	)
Valuation allowance against deferred assets – non-current		83.7			73.5
Net deferred income tax asset	$	(62.6	)	$	(38.8	)
Net deferred tax asset – Foreign	$	(32.4	)	$	(22.8	)
Net deferred tax asset – U.S.		(30.2	)		(16.0	)
Total	$	(62.6	)	$	(38.8	)

Federal interest expense limitation carryforwards have an indefinite carryforward period. Foreign net operating losses have varying carryforward periods with some being indefinite. Similarly, state net operating losses have varying carryforward periods with some being indefinite. Foreign tax credits have a 10-year carryforward period. A majority of the Company’s foreign tax credit carryforwards expire in 2026 and 2027, with the remainder expiring in future periods.

The One Big Beautiful Bill Act (“OBBBA”) was signed into law on July 4, 2025. The OBBBA makes permanent certain expiring provisions of the Tax Cuts and Jobs Act and restores favorable tax treatment for certain business provisions including 100% bonus depreciation and the business interest expense limitation. In general, the favorable bonus depreciation and interest expense limitation provisions will allow the Company to accelerate deductions and reduce cash taxes. The impacts of the OBBBA are reflected in our consolidated financial statements for the year ended December 31, 2025.

The Company assesses the likelihood that it will be able to recover its deferred tax assets against future sources of taxable income and reduces the carrying amounts of deferred tax assets by recording a valuation allowance if, based on all available evidence, the Company believes it is more likely than not that all or a portion of such assets will not be realized. The changes in tax law within the OBBBA resulted in sufficient positive evidence to reach a conclusion that valuation allowances related to federal and certain state interest expense carryforwards are no longer required. The Company also considered the achievement of sustained profitability and cumulative income as well as future projected earnings in relevant state filing groups to be significant forms of positive evidence. The Company determined that the positive evidence outweighed the negative evidence and supported a release of a portion of the state valuation allowance.

The Company’s valuation allowance changed from $129.5 as of December 31, 2024 to $74.5 as of December 31, 2025. The decrease primarily relates to a $60.9 release of domestic valuation allowances consisting of $48.5 related to federal interest expense carryforwards and $11.2 related to state net operating losses, interest expense carryforwards and other deferred tax assets. CUSA’s valuation allowance changed from $83.7 as of December 31, 2024 to $ 73.5 as of December 31, 2025. The decrease primarily relates to a $10.4 release of state valuation allowances related to net operating losses and other deferred tax assets.

The Company maintains a valuation allowance against certain deferred tax assets for which the ultimate realization of future benefits is uncertain. Expiring carryforwards and the required valuation allowances are adjusted annually. After application of the valuation allowances described above, the Company anticipates that no limitations will apply with respect to utilization of any of the other deferred tax assets described above. The remaining valuation allowance primarily relates to foreign tax credits and certain state interest expense carryforwards and other deferred tax assets.

Holdings’ valuation allowance for deferred tax assets, which includes CUSA’s valuation allowance for deferred tax assets, and CUSA’s valuation allowance for deferred tax assets, for the periods presented were as follows:


	Valuation Allowance for Deferred Taxes
	Holdings			CUSA
Balance at January 1, 2023	$	326.1		$	283.2
Additions		16.6			5.9
Deductions		(83.0	)		(77.2	)
Currency translation		6.6			6.6
Balance at December 31, 2023	$	266.3		$	218.5
Additions		7.9			4.2
Deductions		(137.4	)		(131.7	)
Currency translation		(7.3	)		(7.3	)
Balance at December 31, 2024	$	129.5		$	83.7
Additions		5.8			4.2
Deductions		(60.8	)		(14.4	)
Balance at December 31, 2025	$	74.5		$	73.5

Uncertain Tax Positions

The following is a reconciliation of the total amounts of unrecognized tax benefits excluding interest and penalties for Holdings for the periods presented:


	Year Ended December 31,
	2023			2024		2025
Balance at January 1,	$	55.8		$	52.9	$	54.0
Gross increases - tax positions in prior periods		2.2			0.4		1.2
Gross decreases - tax positions in prior periods		(5.1	)		—		—
Gross increases - current period tax positions		0.2			0.7		1.9
Statute of limitations expiration		(0.2	)		—		(2.7	)
Balance at December 31,	$	52.9		$	54.0	$	54.4

The following is a reconciliation of the total amounts of unrecognized tax benefits excluding interest and penalties for CUSA for the periods presented:


	Year Ended December 31,
	2023			2024		2025
Balance at January 1,	$	53.9		$	51.0	$	52.2
Gross increases - tax positions in prior periods		2.2			0.5		1.2
Gross decreases - tax positions in prior periods		(5.1	)		—		—
Gross increases - current period tax positions		0.2			0.7		1.9
Statute of limitations expiration		(0.2	)		—		(2.7	)
Balance at December 31,	$	51.0		$	52.2	$	52.6

Holdings had $68.3 and $72.1 of unrecognized tax benefits, including interest and penalties, as of December 31, 2024 and 2025, respectively. Of these amounts, $68.3 and $68.2 represent the amount of unrecognized tax benefits

that, if recognized, would impact the effective income tax rate for the years ended December 31, 2024 and 2025, respectively. CUSA had $66.4 and $70.3 of unrecognized tax benefits, including interest and penalties, as of December 31, 2024 and 2025, respectively. Of these amounts, $66.4 and $65.7 represent the amount of unrecognized tax benefits that, if recognized, would impact the effective income tax rate for the years ended December 31, 2024 and 2025, respectively. Holdings and CUSA had $14.3 and $17.7 accrued for interest and penalties as of December 31, 2024 and 2025, respectively.

The Company prepares and files income tax returns based upon its interpretation of tax laws and regulations and record estimates based upon these judgments and interpretations. In the normal course of business, the Company’s income tax returns are subject to examination by various taxing authorities. Such examinations may result in future tax and interest assessments by these taxing authorities. Inherent uncertainties exist in estimates of tax contingencies due to changes in tax law resulting from legislation, regulation, and/or as concluded through the various jurisdictions' tax court systems. Significant judgment is exercised in applying complex tax laws and regulations across multiple global jurisdictions where we conduct our operations. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained upon examination by the taxing authorities, including resolutions of any related appeals or litigation processes, based upon the technical merits of the position.

The Company is no longer subject to income tax audits from the Internal Revenue Service for years before 2018. The Company is no longer subject to state income tax examinations by tax authorities in its major state jurisdictions for years before 2021. The Company is no longer subject to non-U.S. income tax examinations by tax authorities in its major non-U.S. tax jurisdictions for years before 2010.

The Company is currently under IRS audit for tax years 2019 and 2020 and is under audit in the non-U.S. tax jurisdiction of Brazil. On June 11, 2025, the IRS issued a revised Revenue Agent Report (“RAR”) proposing an income tax adjustment related to positions reported in each year. The balance sheet impact related to the tax years under audit, which includes a refund held in suspense, is estimated to be $65.0 before interest and penalties. The Company firmly disagrees with the conclusions presented by the IRS and believes the positions reported on its tax returns that have not been reserved for are more likely than not to prevail on technical merits. The Company intends to vigorously defend its reported positions through the applicable IRS administrative and judicial procedures, as appropriate. The Company regularly assesses the likelihood of adverse outcomes resulting from examinations such as this to determine the adequacy of the Company’s tax reserves. Currently, the Company believes it is adequately reserved for these matters. The ultimate outcome of disputes of this nature is uncertain and there can be no assurance that the dispute with the IRS will be resolved favorably.

Cash Paid for Income Taxes

The Company paid cash for income taxes, net of refunds, as follows:


	Year Ended December 31,
	2025

Federal	$	6.3

State:
California		3.3
Other		3.3
Total state		6.6

Foreign:
Argentina		4.7
Brazil		5.7
Colombia		2.7
Chile		7.4
Other		4.1
Total foreign		24.6

Total cash paid for income taxes	$	37.5

The amount of cash paid for income taxes, net of refunds, during the years ended December 31, 2023 and 2024 was $22.3 and $45.5, respectively.

Historical Timeline

Fiscal Year	Filed
2025	Feb 18, 2026	Showing above
2024	Feb 19, 2025

2023	Feb 16, 2024

2022	Feb 24, 2023

2021	Feb 25, 2022

2020	Feb 26, 2021

2019	Feb 21, 2020

2018	Feb 28, 2019

2017	Feb 23, 2018

2016	Feb 23, 2017

2015	Feb 24, 2016

About Income Taxes Disclosures

The income tax disclosure reveals how much a company actually pays in taxes versus what the statutory rate would predict. Analysts focus on the effective tax rate (ETR) reconciliation, which breaks down every item driving the gap between the 21% federal rate and the company's reported ETR — including R&D credits, foreign rate differentials, and state taxes. Deferred tax assets (DTAs) and their valuation allowances signal management's confidence in future profitability: a rising allowance suggests the company doubts it can use accumulated tax benefits. Uncertain tax benefit (UTB) reserves quantify exposure to IRS challenges on aggressive positions.

Key signals to watch: sudden ETR drops without clear operational reasons, large increases in valuation allowances, growing UTB balances, and significant unremitted foreign earnings. Post-TCJA, pay attention to GILTI and BEAT provisions that affect multinational tax structures. Compare the cash taxes paid (from the cash flow statement) against the income tax provision to gauge earnings quality.

Cinemark Holdings, Inc. Income Taxes Disclosure

Historical Timeline

About Income Taxes Disclosures

Other Available Disclosures