Six Flags Swings to $1.18B Loss on Massive Goodwill Impairment

Ticker: FUN · Form: 10-Q · Filed: 2025-11-07T00:00:00.000Z

Sentiment: bearish

Topics: Goodwill Impairment, Net Loss, Amusement Parks, Merger Integration, Debt Levels, Seasonal Business, SEC Filing

Related Tickers: FUN, SIX

TL;DR

**Six Flags just took a $1.5B goodwill hit, signaling deep trouble for the Cedar Fair merger and making FUN a risky bet.**

AI Summary

Six Flags Entertainment Corporation (FUN) reported a significant net loss of $1.187 billion for the three months ended September 28, 2025, a stark contrast to the net income of $110.966 million in the prior-year period. For the nine months ended September 28, 2025, the net loss attributable to Six Flags Entertainment Corporation was $1.506 billion, compared to a net income of $33.052 million in the same period of 2024. This substantial loss was primarily driven by a $1.518 billion loss on impairment of goodwill and other intangibles recorded in the current nine-month period, compared to $42.462 million in the prior year. Total net revenues decreased slightly to $1.317 billion for the three months ended September 28, 2025, from $1.348 billion in the prior-year quarter, with admissions revenue declining from $716.684 million to $664.647 million. However, for the nine months, total net revenues increased to $2.450 billion from $2.021 billion. The company's cash and cash equivalents decreased to $70.683 million as of September 28, 2025, from $83.174 million at December 31, 2024. Long-term debt increased to $5.011 billion from $4.723 billion over the same period, including $500 million in term debt borrowings during the nine months ended September 28, 2025.

Why It Matters

This filing reveals a critical financial deterioration for Six Flags, primarily due to a massive $1.518 billion goodwill impairment, signaling that the company's assets are significantly overvalued relative to their earning potential. For investors, this translates to a substantial loss per share of $11.77 for the quarter, raising serious questions about the long-term viability and valuation of the combined entity post-merger with Cedar Fair. Employees and customers might see impacts through potential cost-cutting measures or changes in park operations as the company navigates this financial challenge. In the competitive amusement park industry, this impairment could weaken Six Flags' ability to invest in new attractions or compete effectively with rivals like Disney or Universal, potentially shifting market dynamics.

Risk Assessment

Risk Level: high — The company reported a staggering $1.518 billion loss on impairment of goodwill and other intangibles for the nine months ended September 28, 2025, a dramatic increase from $42.462 million in the prior-year period. This impairment directly led to a net loss of $1.187 billion for the quarter and $1.506 billion for the nine months, indicating significant overvaluation of assets post-merger and substantial financial distress.

Analyst Insight

Investors should exercise extreme caution and consider reducing exposure to FUN given the massive goodwill impairment and significant net losses. A thorough re-evaluation of the company's post-merger synergy projections and debt load, which increased to $5.011 billion, is warranted before making any new investment decisions.

Financial Highlights

debt To Equity
N/A
revenue
$2.450B
operating Margin
N/A
total Assets
$7.889B
total Debt
$5.011B
net Income
$(1.506B)
eps
$(14.99)
gross Margin
N/A
cash Position
$70.683M
revenue Growth
+21.2%

Revenue Breakdown

SegmentRevenueGrowth
Admissions$664,647,000-7.3%
Food, merchandise and games$443,126,000+1.4%
Accommodations, extra-charge products and other$209,980,000+7.7%
Admissions$1,256,832,000+20.5%
Food, merchandise and games$832,129,000+21.4%
Accommodations, extra-charge products and other$361,239,000+23.5%

Key Numbers

Key Players & Entities

FAQ

What caused Six Flags Entertainment Corporation's significant net loss in Q3 2025?

Six Flags Entertainment Corporation's significant net loss of $1.187 billion for the three months ended September 28, 2025, was primarily caused by a $1.518 billion loss on impairment of goodwill and other intangibles. This compares to a net income of $110.966 million in the same period of 2024.

How did the Cedar Fair merger impact Six Flags' financial statements?

The Cedar Fair merger, completed on July 1, 2024, resulted in Cedar Fair being the accounting acquirer. The results of Former Six Flags are included from the closing date forward. The merger's impact is evident in the substantial goodwill impairment of $1.518 billion, suggesting a re-evaluation of the combined entity's asset values.

What are the key revenue trends for Six Flags Entertainment Corporation?

For the three months ended September 28, 2025, net revenues decreased slightly to $1.317 billion from $1.348 billion in the prior-year quarter, with admissions revenue declining from $716.684 million to $664.647 million. However, for the nine months, total net revenues increased to $2.450 billion from $2.021 billion.

What is Six Flags' current debt situation?

As of September 28, 2025, Six Flags Entertainment Corporation's long-term debt stood at $5.011 billion, an increase from $4.723 billion at December 31, 2024. This includes $500 million in term debt borrowings during the nine months ended September 28, 2025.

How has Six Flags' liquidity changed?

Six Flags' liquidity, as measured by cash and cash equivalents, decreased to $70.683 million as of September 28, 2025, from $83.174 million at December 31, 2024. Net cash from operating activities also decreased to $365.140 million for the nine months ended September 28, 2025, from $405.983 million in the prior-year period.

What is the impact of the goodwill impairment on Six Flags' balance sheet?

The $1.518 billion loss on impairment of goodwill and other intangibles significantly reduced the goodwill balance to $2.064 billion as of September 28, 2025, from $3.296 billion at December 31, 2024. This directly contributed to a decrease in total assets from $9.130 billion to $7.889 billion.

What is the status of the putative securities class action lawsuit against Six Flags?

During the third quarter of 2024, Six Flags Entertainment Corporation entered into a settlement agreement, subject to court approval, to resolve a putative securities class action lawsuit for $40.0 million. The court approved the settlement in January 2025, and the amount will be fully funded by the company's insurance carriers.

How does Six Flags account for its seasonal operations?

Due to the seasonal nature of its amusement and water park operations, Six Flags recognizes revenues from multi-use products over their estimated uses. Certain seasonal operating costs are expensed over each park's operating season, with some pre-season costs deferred and amortized over the season.

What was the change in depreciation accounting for Six Flags?

Beginning July 1, 2024, the Combined Company changed its interim basis of recording depreciation from park operating days to a straight-line method. This change was implemented to improve internal and industry comparability and better represent the impact on fixed asset values over time.

What are the earnings per share for Six Flags Entertainment Corporation?

For the three months ended September 28, 2025, basic loss per share was $(11.77), compared to basic income per share of $1.11 in the prior-year quarter. For the nine months, basic loss per share was $(14.99), a significant drop from basic income per share of $0.49 in the prior-year period.

Risk Factors

Industry Context

The amusement park industry is highly competitive, relying on unique attractions, guest experience, and effective marketing to drive attendance and spending. Six Flags operates in a mature market facing competition from other theme parks, entertainment venues, and leisure activities. Trends include investments in new rides, technology integration, and evolving consumer preferences for experiences.

Regulatory Implications

The company must comply with various safety regulations for amusement rides and operational standards. Changes in consumer privacy laws could affect marketing strategies. The significant impairment charges might attract scrutiny from financial regulators regarding asset valuation practices.

What Investors Should Do

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Key Dates

Glossary

Goodwill
An intangible asset that arises when a company acquires another company for a price greater than the fair value of its identifiable net assets. (A significant impairment loss on goodwill was recorded, indicating a substantial decrease in the value of past acquisitions.)
Intangibles
Non-physical assets that have value, such as patents, trademarks, and brand names. Goodwill is a type of intangible asset. (Impairment charges on other intangibles, along with goodwill, contributed to the large net loss.)
Net Revenues
The total revenue of a company after deducting returns, allowances, and discounts. (Provides the top-line performance metric, showing a slight decrease for the quarter but an increase for the nine-month period.)
Cash and cash equivalents
Highly liquid short-term investments that are readily convertible to known amounts of cash and have an insignificant risk of changes in value. (A decrease in this metric suggests reduced liquidity for the company.)
Long-term debt
Financial obligations that are due more than one year from the balance sheet date. (An increase in long-term debt signifies higher financial leverage and potential increased interest expense.)
Deferred revenue
Revenue that has been received by the company but not yet earned, as the goods or services have not yet been provided. (Represents future revenue obligations, with a notable balance of $333.1 million as of September 28, 2025.)
Redeemable non-controlling interests
Represents the equity interests of minority shareholders in consolidated subsidiaries that are redeemable at the option of the holder. (A significant liability of $247.3 million, indicating potential future cash outflows.)

Year-Over-Year Comparison

Compared to the prior year, Six Flags Entertainment Corporation has experienced a dramatic shift from profitability to significant losses, with net income turning into a $1.506 billion net loss for the nine months ended September 28, 2025. This is largely attributable to a $1.518 billion impairment charge, a stark increase from $42.462 million in the prior year. While total revenues for the nine-month period increased by 21.2% to $2.450 billion, driven by strong performance across all segments, the company's financial position has weakened with a decrease in cash and cash equivalents and an increase in long-term debt to $5.011 billion.

Filing Stats: 4,656 words · 19 min read · ~16 pages · Grade level 16.7 · Accepted 2025-11-07 14:56:02

Key Financial Figures

Filing Documents

- Financial Information

Part I - Financial Information Item 1.

Financial Statements

Financial Statements 3 Index for Notes to Unaudited Condensed Consolidated Financial Statements 8 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 26 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 38 Item 4.

Controls and Procedures

Controls and Procedures 38

- Other Information

Part II - Other Information Item 1.

Legal Proceedings

Legal Proceedings 38 Item 1A.

Risk Factors

Risk Factors 39 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 39 Item 5. Other Information 39 Item 6. Exhibits 39

Signatures

Signatures 40 Table of Contents

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS SIX FLAGS ENTERTAINMENT CORPORATION UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) September 28, 2025 December 31, 2024 September 29, 2024 ASSETS Current assets: Cash and cash equivalents $ 70,683 $ 83,174 $ 89,705 Receivables 280,878 164,861 201,653 Inventories 84,921 71,104 89,842 Other current assets 64,137 80,731 75,761 500,619 399,870 456,961 Property and equipment, gross 7,318,003 6,916,761 7,526,470 Accumulated depreciation ( 2,953,376 ) ( 2,619,806 ) ( 2,547,454 ) Property and equipment, net 4,364,627 4,296,955 4,979,016 Goodwill 2,064,541 3,296,523 2,786,109 Other intangibles, net 722,314 897,834 898,662 Right-of-use assets 215,095 227,284 236,286 Other assets 22,290 12,050 12,192 $ 7,889,486 $ 9,130,516 $ 9,369,226 LIABILITIES AND EQUITY Current liabilities: Current maturities of long-term debt $ 15,038 $ 210,000 $ 210,000 Accounts payable 117,552 107,056 120,351 Deferred revenue 333,096 302,326 330,945 Accrued interest 93,805 54,342 95,367 Accrued taxes 44,236 41,021 74,368 Accrued salaries, wages and benefits 47,400 51,030 49,890 Self-insurance reserves 56,908 36,630 124,618 Other accrued liabilities 152,301 124,272 135,072 860,336 926,677 1,140,611 Deferred tax liabilities 456,507 542,583 476,292 Lease liabilities 214,185 230,443 236,810 NCI call option liability 316,370 290,390 — Other liabilities 168,544 133,672 53,743 Long-term debt: Revolving credit loans 97,361 296,953 139,080 Term debt 1,453,308 966,712 976,622 Notes 3,461,264 3,459,407 3,458,805 5,011,933 4,723,072 4,574,507 Commitments and contingencies ( Note 1 ) Redeemable non-controlling interests 247,297 241,816 545,685 Equity: Common stock, 101,259 , 100,350 and 100,275 shares outstanding as of September 28, 2025, December 31, 2024 and September 29, 2024, respectively 1,013 1,004 1,003 Additional paid-in-capital 2,226,836 2,207,410 2,215,647 Retained (deficit) earnings ( 1,670,985 ) ( 164,271 )

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