11. Commitments and Contingencies
Non-cancelable Purchase Commitments
In the ordinary course of business, the Company enters into non-cancelable purchase commitments with various parties to purchase primarily software, IT, and cloud related-based services. As of December 31, 2025, the Company had outstanding non-cancelable purchase commitments in the amount of $141.3 million.
Other Commercial Commitments
In the ordinary course of business, we enter into agreements with certain media partners under which, in some cases, we agree to pay a guaranteed amount—generally tied to page views, placements, or other inventory-based metrics. These arrangements could result in losses on individual media partner accounts when guaranteed amounts exceed the revenue ultimately generated. Contract terms typically range from one to several years.
Legal Proceedings and Other Matters
From time to time, we are involved in, or may become subject to, legal proceedings, claims and government investigations arising in the ordinary course of business, including disputes related to intellectual property, commercial agreements, privacy matters and employment issues. We describe below certain legal proceedings to which we are a party.
Verve Group Arbitration
In December 2025, Verve Group Europe GmbH (“Verve”) filed a petition to compel arbitration against our subsidiary, Zemanta, Inc., in the U.S. District Court for the Southern District of New York. Verve alleges breach of contract related to certain unpaid invoices and seeks payment of approximately $8.1 million. The dispute relates to withholdings we applied to Verve’s accounts following the identification of significant volumes of invalid traffic and non-compliant activity originating from Verve’s inventory. We believe Verve’s claims are without merit, as it is our position that our withholdings were based on documented traffic quality issues, and we intend to defend the matter vigorously.
Other Matters
In addition to the matter described above, we are subject to various other legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of business. We do not believe that the final outcome of any of these matters, individually or in the aggregate, will have a material adverse effect on our consolidated financial position, results of operations, or cash flows.
In connection with the Acquisition, the Company identified and recorded a $19.1 million provision related to certain income tax items under ASC 740, “Income Taxes,” and an $8.7 million provision related to certain non-income tax items accounted for under ASC 450, “Contingencies,” within contingent tax liabilities in its consolidated balance sheet as of December 31, 2025. The Company has also recorded an indemnification asset in the full amount of the provision of $27.8 million, as the Company is indemnified against certain tax liabilities under the SPA. Altice Teads’ indemnification obligation may be increased if other indemnified risks materialize and will remain in place until all covered matters are resolved.