PLAYSTUDIOS, Inc.MYPS

PLAYSTUDIOS, Inc. Fair Value Disclosure

10-KFiled Mar 14, 20252 min read
NOTE 8—FAIR VALUE MEASUREMENT
The carrying values of the Company’s cash and cash equivalents, receivables, net, prepaid expenses and other current assets, and accounts payable approximate fair value due to their short maturities.
The following tables present the liabilities measured at fair value on a recurring basis, by input level, in the Consolidated Balance Sheets at December 31, 2024 and December 31, 2023:
December 31, 2024
Level 1Level 2Level 3Total
Financial liabilities:
Public Warrants$134 — — $134 
Private Warrants— 96 — 96 
Derivative financial instruments— 38 — 38 
Contingent consideration— — 3,340 3,340 
Total financial liabilities$134 $134 $3,340 $3,608 
December 31, 2023
Level 1Level 2Level 3Total
Financial liabilities:
Public Warrants$635 — — $635 
Private Warrants— 451 — 451 
Total financial liabilities$635 $451 $— $1,086 
The fair value of our Level 3 contingent consideration liabilities relate to the Pixode Acquisition. This contingent consideration is primarily based on expected payments arising from a percentage of an adjusted net revenue for a three year period commencing on the re-launch date of the rebranded Pixode assets, payable at the end of each fiscal year. The value of these payments are subject to various market and operational risks. Significant unobservable inputs include a discount rate of approximately 13.5% and the probability of revenue growth over the same three year period. See Note 4—Business
Combinations for more information on the Pixode Acquisition. The change in fair value was included in "Other income (expense), net" in the Consolidated Statements of Operations and consisted of the following:
Total
Balance as of December 31, 2023
$— 
Recorded in connection with business combinations3,255 
Fair value adjustments based upon post-acquisition performance85 
Balance as of December 31, 2024
$3,340 

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

Other Available Disclosures

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