Item 1A. Risk Factors.
The risks described below and elsewhere in this Annual Report are not the only ones that relate to our businesses or our capitalization. The risks described below are considered to be the most material. However, there may be other unknown or unpredictable economic, business, competitive, regulatory or other factors that also could have material adverse effects on our businesses. Past financial performance may not be a reliable indicator of future performance and historical trends should not be used to anticipate results or trends in future periods. If any of the events described below were to occur, our businesses, prospects, financial condition, results of operations and/or cash flows could be materially adversely affected.
Risk Factor Summary
The following is a summary of the material risk factors that could adversely affect our business, financial condition, and results of operations:
Factors Relating to Our Corporate History and the Separation
The historical financial information included in this annual report is not necessarily representative of our future financial position, future results of operations or future cash flows.
We may not realize the benefits of acquisitions or other strategic investments and initiatives.
The unfavorable outcome of pending or future legal proceedings could have a material adverse impact on the operations and financial condition of our business.
We are a holding company, and we may be unable to obtain cash in amounts sufficient to service our financial obligations or meet our other commitments.
Factors Relating to the GCI Business
GCI faces competition, including from non-geostationary satellites and other providers receiving federal grants to construct additional terrestrial networks, that may reduce its market share and harm its financial performance.
Issues related to the use of AI in GCI’s business could give rise to legal or regulatory action, damage GCI’s reputation or otherwise materially harm GCI’s business.
If GCI experiences customer losses or a change in demand for our products and services, our Company’s financial performance will be negatively impacted.
Adverse economic conditions in the U.S. and inflationary pressures on input costs and labor could impact GCI’s results of operations.
GCI may be unable to obtain or maintain the roaming services it needs from other carriers to remain competitive.
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GCI’s business is subject to extensive governmental legislation and regulation. Changes to or interpretations of existing statutes, rules, regulations, or the adoption of new ones, could adversely affect GCI’s business, financial position, results of operations, or liquidity.
A successful legal challenge to relevant USF statutes could disrupt GCI’s USF support.
Failure to stay abreast of new technology could affect GCI’s ability to compete in the industry.
GCI’s operations are geographically concentrated in Alaska and are impacted by the economic conditions in Alaska, and GCI may not be able to increase its share of the existing market for its services.
Natural or man-made disasters or terrorist attacks could have an adverse effect on GCI’s business.
Cyberattacks or other network disruptions could have an adverse effect on our Company and GCI’s business.
The processing, storage, sharing, use, disclosure and protection of personal data could give rise to liabilities as a result of governmental regulation, conflicting legal requirements or differing views of personal privacy rights.
GCI depends on a limited number of third-party vendors to supply communications equipment. If GCI does not obtain the necessary communications equipment, GCI will not be able to meet the needs of its customers.
Uncertainty related to climate change and environmental laws, rules and regulations, and customer expectations could adversely affect GCI’s business.
GCI does not have insurance to cover certain risks to which it is subject, which could lead to the occurrence of uninsured liabilities.
We will require a significant amount of cash to service our debt and to meet other obligations. Our ability to service our debt and other obligations will require access to funds, which may be restricted, and we may not be able to obtain additional financing, or refinance or renew our existing indebtedness, on acceptable terms or at all.
We have significant indebtedness, which could adversely affect our business and financial condition.
Variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly.
Factors Relating to Ownership of GCI Group Common Stock and the Securities Market
Our stock price may fluctuate significantly.
Our multi-series structure may depress the trading price of the shares of GCI Group common stock.
If the GCI Liberty board determines to issue the shares of Ventures Group common stock, GCI Group common stock will become a tracking stock, and a tracking stock structure may cause market confusion.
If the GCI Liberty board decides to implement a tracking stock capital structure, such structure could create conflicts of interest, and the GCI Liberty board may make decisions that could adversely affect only some holders of GCI Liberty’s common stock.
Holders of shares of stock relating to a particular group may not have any remedies if any action by GCI Liberty’s directors or officers has an adverse effect on only that stock, or on a particular series of that stock.
GCI Liberty may dispose of its assets, even if they are attributed to a tracking stock group, without stockholder approval (except to the extent such approval is required under Nevada law or GCI Liberty’s restated articles).
The GCI Liberty board may, in its sole discretion, elect to convert the common stock relating to one group into common stock relating to the other group, thereby changing the nature of your investment and possibly diluting your economic interest in GCI Liberty, which could result in a loss in value to you.
Our multi-series voting structure and potential tracking stock structure may limit your ability to influence corporate matters and future issuances of GCI Group common stock or Ventures Group common stock may further dilute the voting power of shares of GCI Group common stock.
Holders of the common stock of tracking stock groups will vote together and will have limited separate voting rights.
GCI Liberty common stock transactions by our insiders could depress the market price of those stocks.
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Factors Relating to Our Corporate History and the Separation
The historical financial information included in this annual report is not necessarily representative of our future financial position, future results of operations or future cash flows.
Investors should recognize that certain of the historical financial information included in this annual report has been extracted from Liberty Broadband’s historical consolidated financial statements and does not necessarily reflect what our results of operations, financial condition and cash flows would have been had we been a separate, standalone company pursuing independent strategies during the periods presented.
References in this annual report to GCI Liberty’s historical assets, liabilities, products, businesses or activities prior to July 14, 2025 refer to the historical assets, liabilities, products, businesses or activities of the GCI Business, as conducted through the subsidiaries of GCI, LLC, as the business was conducted as part of Liberty Broadband prior to the Separation.
We will continue to incur additional costs as a result of our separation from Liberty Broadband.
We will continue to incur costs and expenses not previously incurred as a result of the Separation. These increased costs and expenses may arise from various factors, including financial reporting, costs associated with complying with the federal securities laws (including compliance with the Sarbanes-Oxley Act), tax administration and human resources-related functions. Although Liberty Media provides many of these services for us under the services agreement, neither we nor Liberty Media can assure you that the services agreement will continue or that these costs will not be material to our business.
Our inter-company agreements were negotiated while we were still a subsidiary of Liberty Broadband.
We entered into a number of inter-company agreements in connection with the completion of the Separation, covering matters such as tax sharing and allocation of responsibility for certain liabilities previously undertaken by Liberty Broadband. In addition, we entered into a services agreement with Liberty Media pursuant to which Liberty Media provides us with certain management, administrative, financial, treasury, accounting, tax, legal and other services, for which we reimburse Liberty Media on a fixed fee basis. The terms of all of these agreements were established while we were a wholly owned subsidiary of Liberty Broadband and, therefore, our agreements with Liberty Broadband and Liberty Media may not be the result of arms’ length negotiations. We believe that the terms of these inter-company agreements are commercially reasonable and fair to all parties under the circumstances; however, conflicts could arise in the interpretation or any extension or renegotiation of the foregoing agreements after the Separation is consummated.
We may not realize the benefits of acquisitions or other strategic investments and initiatives.
Our business strategy and that of our subsidiaries may include selective acquisitions, other strategic investments and initiatives that allow our subsidiaries to expand their businesses. The success of any acquisition depends upon effective integration and management of acquired businesses and assets into the acquirer’s operations, which is subject to risks and uncertainties, including the realization of the growth potential, any anticipated synergies and cost savings, the ability to retain and attract personnel, the diversion of management’s attention from other business concerns and undisclosed or potential legal liabilities of acquired businesses or assets.
Following the Separation, our financial profile has changed, and we are a smaller, less diversified company than Liberty Broadband prior to the Separation.
Following the Separation, GCI Liberty is a smaller, less diversified company than Liberty Broadband prior to the distribution. As a result, we are more vulnerable to changing market conditions, which could have a material adverse effect on our business, financial condition and results of operations. In addition, the diversification of our costs and cash flows has diminished as a standalone company, such that our results of operations, cash flows, working capital and financing requirements are subject to increased volatility and our ability to fund capital expenditures and investments and service debt may be diminished.
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We have overlapping directors and officers with Liberty Broadband and Liberty Media, and overlapping officers with Liberty Live Holdings, which may lead to conflicting interests.
Certain executive officers of Liberty Broadband, Liberty Media and Liberty Live Holdings also serve as our executive officers pursuant to the services agreement between us and Liberty Media, and certain directors of Liberty Broadband and Liberty Media also serve on our board of directors. Our executive officers and members of our board of directors have fiduciary duties to our stockholders. Likewise, any such persons who serve in similar capacities at Liberty Broadband, Liberty Media and Liberty Live Holdings or any other public company, have fiduciary duties to that company’s stockholders. For example, there may be the potential for a conflict of interest when our Company, Liberty Broadband, Liberty Media or Liberty Live Holdings pursues acquisitions and other business opportunities that may be suitable for each of them. Therefore, such persons may have conflicts of interest or the appearance of conflicts of interest with respect to matters involving or affecting more than one of the companies to which they owe fiduciary duties. Further, as allowed by Nevada law, our restated articles renounce any interest or expectancy in certain business opportunities involving our directors and officers, which will allow such directors and officers to pursue those business without liability to us or our stockholders arising out of any duty or obligation to permit the Company to pursue such . Each of our company, Liberty Broadband and Liberty Live Holdings has its rights to certain business and their respective certificate of incorporation provides that no director or officer of the respective company will their fiduciary duty and therefore be liable to the respective company or its stockholders by reason of the fact that any such individual directs a corporate to another person or entity instead of the respective company, or does not refer or communicate information regarding such corporate to our company, unless (x) such was expressly offered to such person solely in his or her capacity as a director or officer of the respective company or as a director or officer of any of the respective company’s subsidiaries, and (y) such relates to a line of business in which the respective company or any of its subsidiaries is then directly engaged.
Our Chairman of the Board, certain other directors and our officers will continue to own Liberty Broadband common stock, Liberty Media common stock and/or Liberty Live Holdings common stock, and equity incentive awards with respect to Liberty Broadband common stock, Liberty Media common stock and/or Liberty Live Holdings common stock. These ownership interests could create, or appear to create, potential conflicts of interest when these individuals are faced with decisions that could have different implications for us, Liberty Broadband, Liberty Media or Liberty Live Holdings.
In addition, any potential conflict that qualifies as a “related party transaction” (as defined in Item 404 of Regulation S-K) is subject to review by the audit committee of our board or another independent body of our board designated to address such actual or potential conflicts. Any other potential conflicts that arise will be addressed on a case-by-case basis, keeping in mind the applicable fiduciary duties owed by the executive officers and directors of each issuer. From time to time, we may enter into transactions with Liberty Broadband, Liberty Media, Liberty Live Holdings and/or their respective subsidiaries or other affiliates. There can be no assurance that the terms of any such transactions will be as favorable to us, Liberty Broadband, Liberty Media, Liberty Live Holdings or any of their respective subsidiaries or affiliates, as would be the case where there is no overlapping officer or director.
The unfavorable outcome of pending or future legal proceedings could have a material adverse impact on the operations and financial condition of our business.
Our subsidiaries are parties to several legal proceedings arising out of various aspects of their businesses, including but not limited to the various matters related to the RHC Program described under Part I, Item 1. “Business — Regulatory Matters—Data Services and Products—RHC Program.” The outcome of these proceedings may not be favorable, and one or more unfavorable outcomes could have a material adverse impact on their respective financial conditions, which can impact our financial performance.
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John C. Malone, the Chairman of the Board, owns shares of GCI Group common stock representing approximately 53.5% of the aggregate voting power of our Company, as of January 31, 2026. While Mr. Malone’s voting power is currently subject to the Malone nonvoting side letter, his current and potential voting power may be deemed to put him in a position to influence significant corporate actions and may discourage others from initiating a potential change of control transaction that may be beneficial to our stockholders.
John C. Malone, the Chairman of the Board, beneficially owns shares of GCI Group common stock representing the power to direct approximately 53.5% of the aggregate voting power of GCI Group common stock, as of January 31, 2026, subject to the Malone nonvoting side letter (as defined below). As a result, Mr. Malone is deemed to be in a position to influence significant corporate actions, including corporate transactions such as mergers, business combinations or dispositions of assets, due to his ownership of GCI Group common stock. However, on December 31, 2024, Mr. Malone and certain holders of shares of GCI Group common stock affiliated with Mr. Malone (collectively, the “Malone GCI group”) entered into a side letter with GCI Liberty (the “Malone nonvoting side letter”) pursuant to which each member of the Malone GCI group irrevocably and unconditionally agreed that the members of the Malone GCI group, in the aggregate, will not vote any shares of GCI Liberty voting stock beneficially owned by the Malone GCI group that, if voted, would result in the aggregate voting power of the Malone GCI group exceeding approximately 49.3%. The Malone nonvoting side letter will automatically terminate upon the occurrence of certain events, including the receipt of the approval of transfer of control applications by the FCC and the RCA permitting the Malone GCI group to exercise de jure control of GCI Liberty. This concentration of ownership could discourage others from initiating any potential merger, takeover or other change of control transaction that may otherwise be to our stockholders. See the risk factor entitled “ It may be for a third party to acquire us, even if doing so may be to our stockholders. ” for information about certain provisions of our articles and bylaws that may , or prevent a change in control of GCI Liberty that a stockholder may consider .
We are a holding company, and we may be unable to obtain cash in amounts sufficient to service our financial obligations or meet our other commitments.
Our ability to meet our current and future financial obligations and other contractual commitments depends upon our ability to access cash. We are a holding company, and our sources of cash include our available cash balances, net cash from the operating activities and indebtedness of our wholly owned subsidiary GCI, LLC and proceeds from any asset sales or other forms of asset monetization we may undertake in the future. In addition, the ability of GCI, LLC to pay dividends or to make other payments or advances to us depends on its operating results and any statutory, regulatory or contractual restrictions to which it may be or may become subject. Some state regulators have imposed, and others may consider imposing, cash management practices on regulated companies, including us, that could limit the ability of such regulated companies to transfer cash between subsidiaries or to the parent company. While none of the existing state regulations materially affect our cash management, any changes to the existing regulations or imposition of new regulations or restrictions may materially adversely affect our ability to transfer cash within our consolidated companies.
Satisfaction by us of our indemnification obligations or the failure of Liberty Broadband or Charter (as defined below) to satisfy their indemnification obligations could have a material adverse effect on our financial conditions, results of operations and cash flows.
Pursuant to the separation and distribution agreement that we entered into with Liberty Broadband in connection with the Separation of the GCI Business by Liberty Broadband, we have agreed to indemnify Liberty Broadband for all losses arising out of, resulting from or in connection with (i) the businesses, assets or liabilities contributed to us in the internal reorganization, (ii) any breach of, or failure to perform or comply with, any covenant, undertaking or obligation of ours under the separation and distribution agreement or other agreements referenced therein and (iii) any untrue statement of material fact in (A) the Company’s Registration Statement on Form S-1 (File No. 333-286272), declared effective by the SEC on June 23, 2025 (the “prior registration statement”), or other disclosure document filed with the SEC in connection with the distribution (other than untrue statements of material fact made by Liberty Broadband or for which Liberty Broadband provided information in writing), or (B) Liberty Broadband’s disclosure documents filed with the SEC prior to the effective time of the distribution for which the applicable disclosure relates to any member of the Spinco group (as defined in the separation and distribution agreement) or for which the Spinco group or its predecessors
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provided information in writing. Further, pursuant to the separation and distribution agreement, Liberty Broadband has agreed to indemnify us for all losses arising out of, resulting from or in connection with (i) the businesses, assets or liabilities retained by Liberty Broadband in the internal reorganization, (ii) any breach of, or failure to perform or comply with, any covenant, undertaking or obligation of Liberty Broadband under the separation and distribution agreement or other agreements referenced therein and (iii) any untrue statement of material fact in (A) the prior registration statement where such untrue statement of material fact is made by Liberty Broadband or for which Liberty Broadband provided information in writing or (B) Liberty Broadband’s disclosure documents filed with the SEC prior to the effective time of the distribution (other than untrue statements of material fact that arise out of disclosures relating to the Spinco group or for which Spinco group or its predecessors provided information in writing). On November 12, 2024, Liberty Broadband entered into a merger agreement with Charter Communications, Inc., a Delaware corporation (“Charter”), and certain of its subsidiaries, whereby, subject to the terms thereof, Charter has agreed to acquire Liberty Broadband in an all-stock transaction (the “Charter combination”). At the completion of the Charter combination, in accordance with the Agreement and Plan of Merger, dated as of November 12, 2024, by and among Liberty Broadband, Charter and certain of Charter’s subsidiaries (the “Charter merger agreement”), Charter will execute a joinder agreement to the separation and distribution agreement, pursuant to which, from and after the of the Charter combination, Charter will be directly responsible and liable for Liberty Broadband’s obligations under the separation and distribution agreement, including Liberty Broadband’s indemnification obligations. These indemnification obligations exclude any matters relating to taxes; however, under the tax sharing agreement and tax receivables agreement, we and Liberty Broadband (and after the of the Charter combination, Charter) also have indemnification obligations to each other with respect to taxes, tax-related items and tax benefits allocated between them under these tax agreements. We could be affected if Liberty Broadband does not make a timely indemnification payment to us, or if we are required to make material payments pursuant to our indemnification obligations to Liberty Broadband.
The indemnity from Liberty Broadband may not be sufficient to protect us against the full amount of such liabilities if, for example, Liberty Broadband fails to fully satisfy its indemnification obligations. Moreover, even if we ultimately succeed in recovering from Liberty Broadband any amounts for which it is held liable, we may be temporarily required to bear those losses ourself, requiring us to divert cash that would otherwise have been used in furtherance of our business operations. In addition, third parties could seek to hold us responsible for any of the liabilities that Liberty Broadband has agreed to retain. Each of these risks could have a material adverse effect on our financial conditions, results of operations and cash flows.
Factors Relating to the GCI Business
We refer to the business operations of the GCI Business as “ GCI ” in the following risk factors relating to the GCI Business.
GCI faces competition, including from non-geostationary satellites and other providers receiving federal grants to construct additional terrestrial networks , that may reduce its market share and harm its financial performance.
There is substantial competition in the telecommunications industry. Through mergers, various service integration strategies, and business alliances, major providers are striving to strengthen their competitive positions. GCI faces increased wireless services competition from national carriers in the Alaska market who are often able to offer more flexible subscription packages and exclusive content. GCI also faces competition from direct-to-user non-geostationary satellite-based internet providers.
In addition, the National Telecommunications and Information Administration is in the process of awarding grants and subgrants under the BEAD program to support the deployment of additional terrestrial broadband facilities in Alaska by multiple providers, including but not limited to GCI. To the extent those grants actually result in deployment of new network facilities by other providers, GCI could face additional competition for both consumer and enterprise services.
Our Company expects competition to increase as a result of the rapid development of new technologies, services, and products, including the increasing use of AI and machine learning technologies, and the availability of increased federal funding of broadband infrastructure. Our Company cannot predict which of many possible future technologies,
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products or services will be important to maintain GCI’s competitive position or what expenditures will be required to develop and provide these technologies, products or services. GCI’s ability to compete successfully will depend on marketing and on its ability to anticipate and respond to various competitive factors affecting the industry, including new services that may be introduced, improvements in network quality and capacity, changes in consumer preferences or habits, demographic trends, economic conditions, and pricing strategies by competitors. To the extent GCI does not keep pace with technological advances or fails to timely respond to changes in competitive factors in its industry and in its markets, GCI could lose market share or experience a decline in its revenue and net income. Competitive conditions create a risk of market share loss and the risk that customers shift to less profitable, lower margin services. Competitive pressures also create challenges for GCI’s ability to grow new businesses or introduce new services successfully and execute its business plan. GCI also faces the risk of potential price cuts by our Company’s competitors partially driven by federal funding for broadband infrastructure that could materially affect its market share and gross margins.
GCI’s wholesale customers, including its major roaming customers, may construct facilities in locations where they currently contract with GCI to use its network to provide service on their behalf. Our Company could experience a decline in revenue and net income if any of GCI’s wholesale customers constructed or expanded their existing networks in places where service is currently provided by GCI’s network. Some of GCI’s wholesale customers have greater access to financial, technical, and other resources than GCI does. GCI expects to continue to offer competitive alternatives to such customers in order to retain significant traffic on GCI’s network. Our Company cannot predict whether such customers will continue to see GCI’s network as a compelling alternative. GCI’s inability to negotiate renewals of such contracts could have a material adverse effect on our Company’s business, financial condition, and results of operations.
Issues related to the use of AI in GCI’s business could give rise to legal or regulatory action, damage GCI’s reputation or otherwise materially harm GCI’s business.
GCI currently incorporates AI technology in certain parts of its business operations. AI presents risks and challenges, and its use could have unintended consequences. AI algorithms and training methodologies may be flawed. Additionally, AI technologies are complex and rapidly evolving. While GCI aims to develop and use AI responsibly and attempt to identify and mitigate ethical and legal issues presented by its use, it may be unsuccessful in identifying or resolving issues before they arise. The U.S. has taken initial steps to regulate AI, which could ultimately increase the risks associated with utilizing AI in GCI’s business, including with respect to data protection, privacy, intellectual property infringement and cybersecurity, or decrease its usefulness. These challenges could adversely affect GCI’s reputation or otherwise materially harm GCI’s business.
If GCI experiences customer losses or a change in demand for our products and services, our Company’s financial performance will be negatively impacted.
GCI is in the business of selling communication services to subscribers, and its economic success is based on its ability to retain current subscribers and attract new subscribers. If GCI is unable to retain and attract subscribers, its and our Company’s financial performance will be impaired. GCI’s rates of subscriber acquisition and turnover are affected by a number of competitive factors, including the size of its service areas, network performance and reliability issues, changing technologies, its device and service offerings, creditworthiness of subscribers, subscribers’ perceptions of its services and the costs thereof, and customer care quality. Managing these factors and subscribers’ expectations is essential in attracting and retaining subscribers. Although GCI has implemented programs to attract new subscribers and address subscriber turnover, including promotional programs, our Company cannot make assurances that these programs or GCI’s strategies to address subscriber acquisition and turnover will be successful. A high rate of turnover or subscriber loss, including loss of promotional subscribers or suspended subscribers, or a change in demand for GCI’s products and services, would reduce revenue and increase the total marketing expenditures required to attract the minimum number of subscribers required to sustain GCI’s business plan which, in turn, could have a material effect on GCI and our Company’s business, financial condition, and results of operations.
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Adverse economic conditions in the U.S. and inflationary pressures on input costs and labor could impact GCI’s results of operations.
In recent years, varying factors have contributed to significant volatility and disruption of financial markets and global supply chains. Additionally, the U.S. Federal Reserve began decreasing interest rates in 2024 after several years of higher rates, and while interest rates remained steady throughout most of 2025, the U.S. Federal Reserve further decreased rates in the second half of 2025. The imposition of tariffs and other economic measures which may have an impact on inflation, and inflationary cost pressures and recessionary fears have negatively impacted the U.S. and global economy. Unfavorable economic conditions, such as a recession or economic slowdown in the U.S., or inflation in the markets in which GCI operates, could negatively affect the affordability of, and demand for, GCI’s products and services and its cost of doing business. Higher interest rates, as well as higher labor, information technologies and capital expenditure costs due to inflation, could negatively impact GCI’s results. Increased equipment costs, for example due to increased tariffs, could also impact GCI’s results. See the risk factor entitled “ GCI depends on a limited number of third-party vendors to supply communications equipment. If GCI does not obtain the necessary communications equipment, GCI will not be to meet the needs of its customers. ” for more information about the risks associated with changes in U.S. and foreign trade policies.
The Alaska economy is dependent upon the oil industry, state and federal spending, investment earnings and tourism. Volatility in oil prices, and in particular a decline in oil prices, including as a result of uncertainty arising from the U.S.’s actions in relation to Venezuela and increasing tensions in Iran, would put significant pressure on the Alaska state government budget. The Alaska state government has financial reserves that GCI believes may be able to help fund the state government for the next couple of years. If the U.S. government were to significantly reduce federal funding, such a reduction could have a material adverse impact on the state of Alaska and GCI. The potential impact of any reduction in federal spending cannot be predicted at this time. The Alaska economy is subject to recessionary pressures as a result of the economic impacts of volatility in oil prices, inflation, and other causes that could result in a decrease in economic activity. While it is difficult for GCI to predict the future impact of a recession on its business, these conditions have had an impact on its business and could affect the affordability of, and demand for, some of its products and services and cause customers to shift to lower priced products and services or to or forgo purchases of its products and services. GCI’s customers may not be to obtain adequate access to credit, which could affect their ability to make timely payments to GCI and could lead to an increase in accounts receivable and debt expense. If Alaska experiences a or economic , it could affect GCI’s business, including its financial position, results of operations, or liquidity, as well as its ability to service debt, pay other obligations, and shareholder returns.
In addition, during 2024 and continuing in 2025, GCI experienced the impact of inflation-sensitive items, including upward pressure on the costs of materials, labor, and other items that are critical to GCI’s business, and GCI expects these trends to continue into 2026. GCI continues to monitor these impacts closely and, if costs continue to rise, GCI may be unable to recoup losses or offset diminished margins by passing these costs through to its customers or implementing offsetting cost reductions.
GCI may be unable to obtain or maintain the roaming services it needs from other carriers to remain competitive.
Some of GCI’s competitors have national networks that enable them to offer nationwide coverage to their subscribers at a lower cost than GCI can offer. The networks GCI operates do not, by themselves, provide national coverage, and GCI must pay fees to other carriers that provide roaming services to it. GCI currently relies on roaming agreements with several carriers for the majority of its roaming services.
The FCC requires commercial mobile radio service providers to provide roaming, upon request, for voice and SMS text messaging services on just, reasonable, and non-discriminatory terms. The FCC also requires carriers to offer data roaming services. The rules do not provide or mandate any specific mechanism for determining the reasonableness of roaming rates for voice, SMS text messaging or data services and require that roaming complaints be resolved on a case-by-case basis, based on a non-exclusive list of factors that can be taken into account in determining the reasonableness of particular conduct or rates. If GCI were to lose the benefit of one or more key roaming or wholesale agreements unexpectedly, it may be unable to obtain similar replacement agreements and as a result may be unable to continue providing nationwide voice and data roaming services for its customers or may be unable to provide such services on a
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cost-effective basis. GCI’s inability to obtain new or replacement roaming services on a cost-effective basis may limit its ability to compete effectively for wireless customers, which may increase customer turnover and decrease GCI’s revenue, which in turn could materially adversely affect our Company’s business, financial condition and results of operations.
GCI’s business is subject to extensive governmental legislation and regulation. Changes to or interpretations of existing statutes, rules, regulations, or the adoption of new ones, could adversely affect GCI’s business, financial position, results of operations, or liquidity.
As described below under Part I, Item 1 “Business—Regulatory Matters,” GCI’s business is subject to extensive federal and state governmental legislation and regulation. There can be no assurance that future changes or additions to the regulatory system under which GCI operates will benefit or have no adverse effect on GCI. Similarly, these rules and regulations are subject to interpretation by the applicable agencies, and new interpretations, which could impact GCI’s operations and have an adverse effect on GCI’s business, position, results of operations, or liquidity. There can be no assurance that future regulatory actions taken by Congress, the FCC or other federal, state or local government authorities, by the judiciary or through Executive Branch action, will not have a similar effect.
With respect to wireless services provided by GCI, the licensing, leasing, construction, operation, sale and interconnection arrangements of wireless communications systems are regulated by the FCC, Alaska, and potentially other state and local regulatory agencies. In particular, the FCC grants wireless licenses and imposes significant regulation on licensees of wireless spectrum. There can be no guarantee that GCI’s existing licenses will be renewed. In addition, while the FCC does not currently regulate wireless service providers’ rates, states may exercise authority over such things as certain billing practices and consumer-related issues. These regulations could increase the costs of GCI’s wireless operations, including with respect to the maintenance of existing licenses granted by the FCC, due to a failure to comply with applicable regulations. GCI is also subject to FCC rules relating to E911 capabilities and failure to comply with these rules could subject GCI to significant fines.
With respect to Internet services provided by GCI, GCI could be adversely impacted if Congress, the FCC or the State of Alaska reclassifies broadband Internet service as a telecommunications service under Title II of the Communications Act. In 2015, the FCC classified broadband Internet service as a telecommunication service. The FCC’s implementing regulations prohibited broadband providers from blocking or throttling most lawful public Internet traffic, from engaging in paid prioritization of that traffic, and from unreasonably interfering with or disadvantaging end users’ and edge providers’ ability to send traffic to, from, and among each other. Although a 2018 FCC order returned to a Title I classification of Internet service and eliminated many of the requirements imposed in its initial 2015 order, in 2024 the FCC adopted an order again reclassifying Internet services as a Title II service and adopting “net neutrality” rules regulating the Internet under Title II. On January 2, 2025, the United State Court of Appeals for the Sixth Circuit vacated the FCC’s 2024 order. Nonetheless, a new administration, Congress and state legislatures may undertake similar efforts. For example, California and Vermont have undertaken such efforts and some states, such as New York, have adopted rules capping Internet access rates for at least some services or customers. Any such rules could decrease GCI’s revenues and could adversely affect the manner and price of providing service, which could have a material effect on GCI’s business, financial position, results of operations, or liquidity.
USF receivables and contributions are subject to change due to regulatory actions taken by the FCC, including the FCC’s interpretations of the USF program rules, or legislative actions that change the rules and regulations governing the USF program.
GCI participates in various USF programs, which provide government subsidies for service to schools, libraries and certain health care providers, to low-income and other eligible households and to support networks in high-cost areas. USF support was 46% and 42% of GCI’s revenue for the years ended December 31, 2025 and 2024, respectively. GCI had USF net receivables of $96 million at December 31, 2025. In addition, the USF programs require GCI and other telecommunications providers to make contributions, based on certain revenue earned, into a fund used to subsidize nationwide these USF programs. The USF programs in which GCI participates are highly regulated. While the rules and regulations governing the USF programs are fairly robust, there can be no assurance that any new rules or regulations adopted will not impact GCI’s USF program anticipated receivables or contribution payments. Further, the FCC and USAC may interpret or apply the applicable rules and regulations in ways that are unexpected to GCI or other program
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participants. As a result, material changes to receivables and contributions may occur, which could have an adverse effect on GCI’s business and our Company’s financial position, results of operations or liquidity. As described above in Part I, Item 1 “Business—Regulatory Matters,” GCI has experienced material changes to receivables and contributions from the USF programs in recent years. For example, in October 2018, the FCC’s Wireline Competition Bureau notified GCI of its decision to reduce rural rates charged to RHC Program customers for the funding year that ended on June 30, 2018 by approximately 26%, resulting in a reduction of total support payments of $28 million, and applied the same cost methodology for the funding years ended on June 30, 2019 and June 30, 2020. In addition, although the FCC has adjusted the RHC Program funding cap and committed to annual adjustments in future years for inflation, there is no guarantee that aggregate funding will be available to pay in full the approved funding for future years. Furthermore, the FCC has adopted a series of changes to the manner in which support issued under the RHC Program will be calculated and approved and has a pending rulemaking to consider additional future changes. Also, in November 2024, the FCC adopted changes to the mechanisms for support of fixed and mobile telecommunications networks in Alaska, with further changes under consideration in a pending rulemaking. Those changes increased support for service to high-cost areas in 2025, but that support may be subject to some reductions thereafter. GCI is currently unable to assess the substance, impact on funding or timing of any such changes to any of the USF programs.
Failure to comply with USF program requirements may have an adverse effect on GCI’s business and our Company’s financial position.
The USF programs in which GCI participates are highly regulated, and, in many cases, require highly technical and nuanced processes and procedures in order to obtain funding and to ensure compliance with the USF programs. For example, telecommunication providers and their customers are subject to regulations that set forth procedures that must be followed by both the provider and the customer, and there are limitations on communications between these parties. If a customer or a provider is found to have not complied with any aspect of these regulations, regardless of whether such noncompliance was unintentional or accidental, the FCC may deny funding and/or require disgorgement of any amounts received under the affected contracts. The FCC may also invalidate any affected contract and impose fines or penalties.
Accordingly, failure to comply with these rules and regulations could have a material adverse effect on GCI’s business and our Company’s financial position, results of operations or liquidity.
Loss of GCI’s ETC status would disqualify it for high-cost and low-income USF support.
The USF pays support to ETCs to support the provision of facilities-based wireline and wireless telephone service in high-cost areas and to low-income consumers. If GCI were to lose its ETC status in any of the high-cost areas where it is currently an authorized ETC, whether due to legislative or regulatory reform or its failure to comply with applicable laws and regulations, GCI would be ineligible to receive high-cost or low-income USF support for providing service in that area, which would have an adverse effect on our Company’s business, financial position, results of operations or liquidity.
A disruption in the payment of USF support or federal grants on which GCI relies, through Executive Branch action or otherwise, could delay or halt those payments.
GCI receives a substantial portion of its revenues from federal universal service support to support infrastructure and services, as well as federal grants, whether as a recipient or a subrecipient, that fund infrastructure investments. On January 27, 2025, the OMB issued a memorandum directing a pause in federal financial assistance pending review for consistency with presidential executive actions. On January 28, 2025, OMB clarified that this only applied to programs affected by certain specified executive actions, which did not appear to include FCC universal service support programs but may include some grants that GCI receives as a recipient or subrecipient, or for which it has applied. OMB withdrew the memorandum on January 29, 2025, and two federal district courts have subsequently issued preliminary injunctions affecting the memorandum. Further reviews may be ongoing by the FCC, the National Telecommunications and Information Administration or the Rural Utility Service. Any pause or other disruption in USF or grant disbursements, or if any pause were to extend to federal universal service support programs, or to other infrastructure grants GCI receives,
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or if any such pause were to become extended, could have a material adverse effect on GCI’s business and our Company’s financial position, results of operations or liquidity.
A successful legal challenge to relevant USF statutes could disrupt GCI’s USF support.
There have been a number of legal challenges to the constitutionality of the USF. The U.S. Courts of Appeals for the Sixth and Eleventh Circuits rejected such challenges in 2023, as did a panel of three judges in the Fifth Circuit. However, on July 24, 2024, the U.S. Court of Appeals for the Fifth Circuit sitting en banc ruled that the USF program is unconstitutional as currently administered, and remanded the case to the FCC. In its decision, the en banc Fifth Circuit concluded that the public delegation of legislative authority to the FCC, combined with the private delegation of authority from the FCC to the USAC resulted in an impermissible and unconstitutional delegation of Congress’ Article I authority. The Supreme Court reversed the Fifth Circuit’s decision and remanded the case on June 27, 2025. There is continuing litigation, as petitioners have filed a new Petition for Review in the Fifth Circuit, on October 1, 2025, to challenge two statutory provisions that the Supreme Court did not have occasion to address, and pursuant to which GCI or its customers receive universal service support, as well as to challenge the legality of the USAC, which administers that program for the FCC. It is possible that additional cases and appeals will continue to be filed in relation to the matter. A future judicial decision determining that a portion of the legislation establishing the USF program is unconstitutional could GCI’s USF support unless and until any identified legal with the program structure or administration are remedied. Such a ruling could result in a material decrease in revenue and accounts receivable, which would have an effect on GCI’s business and an effect on the Company’s financial position, results of operations or liquidity. USF support was 46% and 42% of GCI’s revenue for the years ended December 31, 2025 and 2024, respectively. GCI had USF net receivables of $96 million at December 31, 2025.
With a material reduction in USF support, telecommunications providers, including GCI, may need to consider various actions including, but not limited to, terminating certain high-cost or low profit services, discontinuing rural networks or a reduction in workforce, which could have a negative impact on GCI’s business.
GCI may not meet its performance plan milestones under the Alaska High Cost Order.
As an ETC, GCI receives support from the USF to support the provision of wireline local access and wireless service in high-cost areas. In 2016, the FCC published the Alaska High Cost Order, which required GCI to submit to the FCC a performance plan with five-year and ten-year commitments. The FCC approved revised performance obligations in 2021. If GCI is unable to meet the final performance plan milestones approved by the FCC, it could required to repay 1.89 times the average amount of support per location received over the ten-year term for the relevant number of locations that GCI failed to deploy to, plus potentially ten percent of its total Alaska High Cost Order support received over the ten-year term. In addition, a material failure to meet the performance plan milestones under the Alaska High Cost Order could affect GCI’s participation in the Alaska Connect Fund mobile high-cost support, which is a successor plan to the Alaska High Cost Order and would provide high-cost universal service support from 2027 through 2034. Inability to meet GCI’s performance plan milestones with or without disqualification from the Alaska Connect Fund could have an adverse effect on its business, financial position, results of operations, or liquidity, and could cause us to incur a fine of up to $58.6 million and an additional $7,951 per resident .
GCI may lose USF high-cost support after 2026 if certain competitive conditions are met.
On November 4, 2024, the FCC released an order establishing a new high-cost support mechanism for Alaska, the Alaska Connect Fund Order, to replace the Alaska High Cost Order, which was set to expire at the end of 2026. In the Alaska Connect Fund Order, the FCC increased by 30% the annual support that each Alaska High Cost Order recipient received, starting January 1, 2025, through the end of 2026 for mobile services and through the end of 2028 for fixed services. For mobile services, support may be reduced after 2026 to the extent associated with any areas deemed ineligible for support and not replaced by comparable areas, and may be further reduced after 2030 in areas served by more than one Alaska Connect Fund Order supported provider, based upon a competitive selection process still pending further FCC consideration in a pending rulemaking proceeding. Because key elements of these processes are still being defined by the FCC, GCI cannot estimate whether or to what extent it will experience a reduction of mobile high-cost universal service
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support after 2026. Similarly, GCI cannot estimate whether or to what extent it may experience a reduction in fixed broadband support after 2028.
GCI may experience delayed or lost USF high-cost support if the FCC does not approve its mobile performance plan in 2026 or its fixed broadband performance plan in or after 2028.
Continuation of GCI’s high-cost support after 2026, for mobile service, and after 2028, for fixed voice and broadband service, is contingent upon obtaining FCC approval for its performance plan in which it would make commitments as to how support would be used to improve mobile and fixed broadband services, respectively. If GCI cannot obtain FCC approval of its performance plan by the end of 2026, for mobile services, or the end of 2028, for fixed services, it could be subject to a delay or loss of such support.
The decline in GCI’s Other revenue, which includes long-distance and local access services, may accelerate.
Our Company expects GCI’s Other revenue, which includes long-distance and local access services, will continue to decline due to decreases in voice subscribers, consistent with the industry. Until 2025, GCI’s Other revenue also included video services. We experienced losses in video revenue as a result of the transition from traditional linear video delivery to IP delivery and GCI’s decision to discontinue selling bulk video packages for multi-dwelling units. Following regulatory approval, GCI Holdings exited the video business in 2025.
As competition from wireless carriers, as well as competition from GCI’s own product offerings, increases, our Company expects GCI’s long-distance and local access services’ subscribers and revenue will continue to decline and the rate of decline may accelerate. In addition, GCI’s success in the local telephone market depends on its continued ability to obtain interconnection, access, and related services from local exchange carriers on terms that are reasonable and that are based on the cost of providing these services. GCI’s ability to provide service in the local telephone market depends on its negotiation or arbitration with local exchange carriers to allow interconnection to the carrier’s existing local telephone network (in some Alaska markets at cost-based rates), to establish dialing parity, to obtain access to rights-of-way, to resell services offered by the local exchange carrier, and in some cases, to allow the purchase, at cost-based rates, of access to certain unbundled network elements. Future negotiations or arbitration proceedings with respect to new or existing markets could result in a change in GCI’s cost of serving these markets via the facilities of the ILECs or via wholesale offerings. GCI’s local telephone services business faces the risk of unfavorable changes in regulation or legislation or the introduction of new regulations.
Failure to stay abreast of new technology could affect GCI’s ability to compete in the industry.
GCI tests and deploys various new technologies and support systems intended to enhance its competitiveness and increase the utility of its services. As GCI’s operations grow in size and scope, it must continuously improve and upgrade its systems and infrastructure while maintaining or improving the reliability and integrity of its systems and infrastructure. The emergence of alternative platforms such as mobile or tablet computing devices and the emergence of niche competitors who may be able to optimize products, services, or strategies for such platforms will require new investment in technology. Replacing or upgrading GCI’s infrastructure to keep pace with such technological changes could result in significant capital expenditures. Further, current and new wireless internet technologies such as 4G and 5G wireless broadband services continue to evolve rapidly to allow for greater speed and reliability, and our Company expects other advances in communications technology to occur in the future. GCI may not successfully complete the rollout of new technology and related features or services in a timely manner, and they may not be widely accepted by GCI’s customers or may not be , in which case GCI could not recover its investment in the technology. There can be no assurance that GCI will be to compete with technology or introduce new technologies and systems as quickly as it would like or in a cost- manner. Deployment of technology supporting new service offerings may also affect the performance or reliability of its networks with respect to both the new and existing services. Any resulting customer could affect GCI’s ability to retain customers and attract new customers and may have an effect on our Company’s financial position, results of operations, or liquidity. In addition to introducing new technologies and offerings, GCI must phase out and technologies and services. If GCI is to do so on a cost- basis, GCI could experience reduced profits.
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GCI’s operations are geographically concentrated in Alaska and are impacted by the economic conditions in Alaska, and GCI may not be able to increase its share of the existing market for its services.
GCI offers products and services to customers primarily throughout Alaska. Because of this geographic concentration, growth of GCI’s business and operations depends upon economic conditions in Alaska, which have been negatively impacted in recent years by a recession.
In addition, the customer base in Alaska is limited, and GCI has already achieved significant market penetration with respect to its service offerings in Anchorage and other locations in Alaska. GCI may not be able to continue to increase its share of the existing markets for its services, and no assurance can be given that the Alaskan economy will grow and increase the size of the markets GCI serves or increase the demand for the services it offers. The markets in Alaska for wireless and wireline telecommunications are unique and distinct within the U.S. due to Alaska’s large geographical size, its sparse population located in a limited number of clusters, and its distance from the rest of the U.S.
Natural or man-made disasters or terrorist attacks could have an adverse effect on GCI’s business.
GCI’s technical infrastructure (including its communications network infrastructure and ancillary functions supporting its network such as service activation, billing and customer care) is vulnerable to damage or interruption from technology failures, power surges or outages, natural disasters, fires, human error, terrorism, intentional wrongdoing, or similar events. As a communications provider, there is an increased risk that GCI’s technological infrastructure may be targeted in connection with terrorism, either as a primary target, or as a means of facilitating additional attacks on other targets.
In addition, earthquakes, floods, fires, and other unforeseen natural disasters or events could materially disrupt GCI’s business operations or its provision of service in one or more markets. Specifically, the majority of GCI’s facilities are located in areas with known significant seismic activity, as well as harsh winter conditions and ice. Costs GCI incurs to restore, repair or replace its network or technical infrastructure, as well as costs associated with detecting, monitoring, or reducing the incidence of unauthorized use, may be substantial and increase GCI’s cost of providing service. For example, the costs to restore and repair our infrastructure due to the damage caused by Typhoon Halong in October 2025 may be significant. Many of the areas in which GCI operates have limited emergency response services and may be difficult to reach in an emergency situation. Should a natural disaster or other event occur, it could be weeks or longer before remediation efforts could be implemented, if they could be implemented at all. Further, any in, or of, systems that GCI or third parties maintain to support ancillary functions, such as billing, point of sale, inventory management, customer care, and financial reporting, could materially impact GCI’s ability to timely and accurately record, process, and report information important to our Company’s business. Further, if the communities impacted by natural are not rebuilt, depending on magnitude of the of customers, the Company’s results of operations and financial condition could be materially affected. If any of the above events were to occur, GCI could experience higher churn, reduced revenue, and increased costs, any of which could its reputation and have a material effect on our Company’s business, financial condition, or results of operations.
Additionally, our Company’s insurance may not be adequate to cover the costs associated with a natural disaster or terrorist attack.
Cyberattacks or other network disruptions could have an adverse effect on our Company and GCI’s business.
Our Company’s operations depend upon the transmission of information over the Internet. Unauthorized parties attempt to gain access to our Company’s and its vendors’ information systems by, among other things, hacking into its systems or those of third parties, through fraud or other means of deceiving our Company’s employees or its vendors, burglaries, errors by our Company or its vendors’ employees, misappropriation of data by employees, or other irregularities that may result in persons obtaining unauthorized access to its data. The techniques used to gain such access to our Company’s or its vendors’ information systems, data or customer information, disable or degrade service, or sabotage systems are constantly evolving and continue to become more sophisticated and targeted, may be difficult to detect quickly, and often are not recognized until launched a target. Further, the use of AI and machine learning by
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may increase the frequency and severity of cybersecurity attacks against us or our suppliers, vendors and other service providers.
Cyberattacks against GCI’s or our Company’s vendors’ technological infrastructure or breaches of information systems may cause equipment failures, disruption of its or their operations, and potentially unauthorized access to confidential customer or employee data, which could subject our Company to increased costs and other liabilities as discussed further below. Cybersecurity incidents and cybersecurity threats, which include the use of malware, computer viruses, and other means for service disruption or unauthorized access to confidential customer or employee data, have increased in frequency, scope, and potential harm for businesses in recent years. It is possible for such cybersecurity incidents and cybersecurity threats to go undetected for an extended period of time, increasing the potential to GCI’s or our Company’s respective customers, employees, assets, and reputation. For example, third-party service providers, such as telecommunications and cloud services providers, have been subject to increasing from state-sponsored actors that could materially impact our information systems and operations.
To date, our Company and GCI have not been subject to cybersecurity incidents or disruptions of information systems that, individually or in the aggregate, have been material to our or GCI’s operations or financial condition. Although our Company and GCI have not detected such a material security breach or cybersecurity incident to date, our Company and GCI have been the target of events of this nature and expect to be subject to similar attacks in the future. Our Company and GCI engage in a variety of preventive measures at an increased cost intended to reduce the risk of cyberattacks and safeguard our information systems and confidential customer information, but as with all companies, these measures may not be sufficient for all eventualities, and there is no guarantee that they will be adequate to safeguard against all cybersecurity incidents, system compromises, or misuses of data. Such measures include, but are not limited to, the following practices: application whitelisting, anti-malware, message and spam filtering, encryption, advanced firewalls, monitoring and detection, access controls, penetration testing, third party risk management and URL filtering. these preventive and detective actions, our and GCI’s efforts may be to repel a cybersecurity , detect all cybersecurity , or prevent of information systems in the future and prevent the risks described above.
In addition, some of the most significant risks to GCI’s information systems, networks, and infrastructure include:
cyberattacks that disrupt, damage, or allow unauthorized access to GCI’s network and computer systems by criminal or terrorist actors, which may result in data breaches or network disruptions;
undesired human actions including intentional or accidental errors, misconfigurations, and break-ins;
malware (including viruses, worms, and Trojan horses), software defects, unsolicited mass advertising, denial of service attacks, ransomware, and other malicious or abusive attacks by third parties; and
unauthorized access to GCI’s information technology, billing, customer care, and provisioning systems and networks and those of its vendors and other providers.
If hackers or cybercriminals gain access to our or GCI’s information systems, networks, or infrastructure, they may be able to access, steal, publish, delete, misappropriate, modify or otherwise disrupt access to confidential customer or employee data. Moreover, additional harm to customers or employees could be perpetrated by third parties who obtain unauthorized access to the confidential customer data. A network or other disruption of information systems (including one resulting from a cyberattack or other cybersecurity incident) could cause an interruption or degradation of service and diversion of management attention, as well as permit access, theft, publishing, deletion, misappropriation, or modification of confidential customer data. Due to the evolving techniques used in to or access to technology networks, our Company or GCI may not be to anticipate or prevent such or access.
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The costs imposed on our Company and GCI as a result of a cybersecurity incident or disruption of information systems could be significant. Among others, such costs could include increased expenditures on cybersecurity measures, litigation, regulatory actions, fines, sanctions, lost revenue from business interruption, and damage to our or GCI’s reputation and the public’s perception regarding GCI’s ability to provide a secure service. As a result, a cybersecurity incident could have a material adverse effect on GCI’s and our Company’s business, financial condition, and operating results. Our Company and GCI also face similar risks associated with security breaches and other cybersecurity incidents affecting third parties with which we affiliate or otherwise conduct business. While GCI maintains cyber liability insurance that provides both third-party liability and first-party insurance coverage, its insurance may not be sufficient to protect all of its from any future or of its systems or other events as described above.
The processing, storage, sharing, use, disclosure and protection of personal data could give rise to liabilities as a result of governmental regulation, conflicting legal requirements or differing views of personal privacy rights.
Through our Company’s operations, sales and marketing activities, it collects and stores certain non-public personal information related to its customers. Our Company also gathers and retains information about employees in the normal course of business. Our Company may share information about such persons with vendors, contractors and other third parties that assist with certain aspects of its business. The collection, storage, sharing, use, disclosure and protection of this information are governed by the privacy and data security policies maintained by these businesses. Moreover, there are federal, state and international laws regarding privacy and the collection, storage, sharing, use, disclosure and protection of personally identifiable information and user data, including regulations specific to GCI’s operations as a telecommunications carrier or video service provider. Specifically, personally identifiable information is increasingly subject to changing legislation and regulations, in numerous jurisdictions around the world, which are intended to protect the privacy of personal information that is collected, processed and transmitted in or from the governing jurisdiction. Compliance with these laws and regulations may be onerous and expensive and may be inconsistent from jurisdiction to jurisdiction, further increasing the cost of compliance.
In addition, while Alaska has not, many states have passed comprehensive state data privacy laws, and some states have enacted issue-specific privacy laws covering health information and children's information. GCI’s failure, and/or the failure by the various third-party vendors and service providers with which GCI does business, to comply with applicable privacy policies or federal or state laws or changes in applicable laws and regulations, or any compromise of security that results in the unauthorized release of personally identifiable information or other user data could damage GCI’s and our reputations and the reputation of their third-party vendors and service providers, discourage potential users from trying their products and services and/or result in fines and/or proceedings by governmental agencies and/or consumers, any one or all of which could adversely affect GCI’s business, financial condition and results of operations and, as a result, our Company. In addition, we, our subsidiaries or our business affiliates may not have adequate insurance coverage to compensate for losses.
Increases in data usage on GCI’s wired and wireless networks may cause network capacity limitations, resulting in service disruptions, reduced capacity, or slower transmission speeds for GCI’s customers.
Video streaming services, AI data processing and peer-to-peer file sharing applications use significantly more bandwidth than traditional Internet activity such as web browsing and email. As use of these services continues to grow, GCI’s customers will likely use more bandwidth than in the past.
Additionally, new wireless handsets and devices may place a higher demand for data on GCI’s wireless network. If this occurs, GCI could be required to make significant capital expenditures to increase network capacity in order to avoid service disruptions, service degradation, or slower transmission speeds for its customers. Alternatively, GCI could choose to implement network management practices to reduce the network capacity available to bandwidth-intensive activities during certain times in market areas experiencing congestion, which could negatively affect its ability to retain and attract customers in affected areas. While our Company believes demand for these services may drive customers to pay for faster speeds, competitive or regulatory constraints may preclude GCI from recovering the costs of the necessary network investments, which could result in an adverse impact to its business, financial condition, and operating results.
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Prolonged service interruptions or system failures could affect GCI’s business.
GCI relies heavily on its network equipment, communications providers, data, and software to support all of its functions. GCI relies on its networks and the networks of others for substantially all of its revenue. GCI is able to deliver services and serve its customers only to the extent that it can protect its network systems against damage from power or communication failures, computer viruses, natural disasters, unauthorized access, and other disruptions. While GCI endeavors to account for failures in the network by providing back-up systems and procedures, GCI cannot guarantee that these back-up systems and procedures will operate satisfactorily in an emergency. Disruption to its billing systems due to a failure of existing hardware and backup protocols could have an adverse effect on our Company’s revenue and cash flow. Should GCI experience a , it could its ability to continue operations. In particular, should a significant service occur, GCI’s ongoing customers may choose a different provider, and its reputation may be , reducing its to new customers.
If failures occur in GCI’s owned or leased undersea fiber optic cable systems or capacity or GCI’s TERRA facilities and its extensions, or in terrestrial facilities owned by a third party upon which GCI relies for significant capacity, GCI’s ability to immediately restore the entirety of GCI’s service may be limited and our Company could incur significant costs.
GCI’s communications facilities include undersea fiber optic cable systems that carry a large portion of its traffic to and from the contiguous Lower 48 states, one of which provides an alternative geographically diverse backup communication facility to the other. GCI also obtains submarine cable-based services from unaffiliated providers operating on unaffiliated submarine cable systems. GCI’s facilities also include TERRA and its extensions, some of which are unringed, operating in a remote environment, and are at times difficult to access for repairs. Damage to an undersea fiber optic cable system or TERRA and its extensions could result in significant unplanned expense. For example, in January 2020, a fiber break occurred in GCI’s TERRA ring in Alaska’s Cook Inlet. Although service was not materially affected and has since been fully restored, and the financial impact was not significant, full functionality was not restored until March 2020 due to the uniquely challenging environmental conditions in the location of the fiber break. Similarly, in June 2023, a fiber break occurred in the network of a third-party provider of terrestrial capacity to GCI. GCI immediately re-routed customer services to be carried by GCI’s TERRA facilities, but service quality in several communities was materially impacted until full restoration was completed in September 2023. Another fiber occurred in the network of the third-party provider in January 2025. GCI re-routed customer services to be carried by GCI’s TERRA facilities, but service quality in several communities was materially impacted until full restoration in September 2025. If a of both sides of the ring of GCI’s undersea fiber optic facilities or GCI’s ringed TERRA facility and its unringed extensions occurs and GCI is not to secure alternative facilities, some of the communications services GCI offers to its customers could be , which could have a material effect on our Company’s business, financial position, results of operations, or liquidity. Furthermore, if GCI were to obtain timely repair of a submarine cable, it could incur costs for alternative connectivity, and its customers could experience or services.
If a failure occurs in GCI’s satellite communications systems, GCI’s ability to immediately restore its service may be limited.
GCI’s communications facilities include satellite transponders that GCI uses to serve many rural and remote Alaska locations. Each of GCI’s C-band and Ku-band satellite transponders are backed up using on-board transponder redundancy. In the event of a complete spacecraft failure, the services are restored using capacity on other spacecraft that are held in reserve. If a failure of GCI’s satellite transponders occurs and GCI is not able to secure alternative facilities, some of the communications services GCI offers to its customers could be interrupted, which could have a material adverse effect on our Company’s business, financial position, results of operations, or liquidity.
GCI depends on a limited number of third-party vendors to supply communications equipment. If GCI does not obtain the necessary communications equipment, GCI will not be able to meet the needs of its customers.
GCI depends on a limited number of third-party vendors to supply wireless, Internet, and other telephony-related equipment. If GCI’s providers of this equipment are unable to meet GCI’s specifications or supply, in a timely manner or
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at all, the equipment necessary to meet GCI’s needs or provide them at an acceptable cost, GCI may not be able to satisfy demand for its services and competitors may fulfill this demand. Due to the unique characteristics of the Alaska communications markets (i.e., remote locations, rural, satellite-served, and low-density populations), in many situations GCI deploys and utilizes specialized, advanced technology and equipment that may not have a large market or demand. GCI’s vendors may not succeed in developing sufficient market penetration to sustain continuing production and may fail. Vendor bankruptcy, or acquisition without continuing product support by the acquiring company, may require GCI to replace technology before its otherwise useful end of life due to lack of ongoing vendor support and product development. New restrictions on sourcing of equipment utilized in federally-supported projects may further exacerbate these risks.
The suppliers and vendors on which GCI relies may also be subject to litigation with respect to technology on which GCI depends, including litigation involving claims of patent infringement. Such claims have been growing rapidly in the communications industry. Our Company is unable to predict whether GCI’s business will be affected by any such litigation. Our Company expects GCI’s dependence on key suppliers to continue as they develop and introduce more advanced generations of technology. The failure of GCI’s key suppliers to provide products or product support could have a material adverse effect on our Company’s business, financial position, and results of operations.
Supply chain disruptions could impact GCI’s ability to obtain equipment and other supplies for its business from its key suppliers and vendors on acceptable terms or at all. To date, GCI’s supply chain disruptions have been limited, but it may experience more severe supply chain disruptions in the future or supplier inability to manufacture or deliver equipment or parts. For example, changes in U.S. or foreign trade policies, including new or increased tariffs, export controls, supply chain restrictions, trade restrictions or sanctions, may result in supply chain disruptions. Any suspension or delay in GCI suppliers’ and vendors’ ability to provide us adequate equipment, consumer devices, software, support services, or supplies, or in GCI’s ability to procure equipment or supplies from other sources in a timely manner or at all, could impair its ability to meet customer demand and therefore could have a material adverse effect on our Company’s business, financial condition, or results of operations. In addition to causing supply chain , changes in U.S. or foreign trade policies may also result in higher costs for the equipment GCI procures, new compliance requirements and other . If U.S. regulations impacting GCI’s supply chain require the removal of any such items from its networks, GCI could experience to its operations and increased costs. If GCI is to pass on any increased costs to customers without impacting demand, or offset them through other measures, GCI's business, financial condition or results of operations could be materially affected.
Uncertainty related to climate change and environmental laws, rules and regulations, and customer expectations could adversely affect GCI’s business.
In recent years, there has been a heightened public focus on climate change, sustainability, and environmental issues, and customer, regulatory, and shareholder expectations are evolving rapidly, with a focus on companies’ climate change readiness, response, and mitigation strategies. As a result, government regulation has been evolving rapidly.
Our Company expects that the trend of increasing environmental awareness will generally continue, which will result in higher costs of operations. GCI is committed to incorporating environmentally sustainable practices into its business. While undertaken in a manner designed to be as efficient and cost effective as possible, this may result in increases in GCI’s costs of operations relative to its competitors.
The potential impact of climate change on GCI’s operations and customers remains uncertain. The primary risk that climate change poses to GCI’s business is the potential for increases in severe weather in the areas in which it operates, including the potential destruction of some communities. See the risk factor entitled “ Natural or man-made disasters or terrorist attacks could have an adverse effect on GCI’s business. ” for more information on the impact of severe weather on our business. Potential physical effects of climate change, such as damage to GCI’s network infrastructure, could result in increased costs and loss of revenue. In addition, governmental initiatives to address climate change could, if adopted, restrict GCI’s operations, require GCI to make capital expenditures to comply with these initiatives, increase GCI’s costs, and impact GCI’s ability to compete. GCI’s inability to timely respond to the risks posed by climate change and the costs of compliance with climate change laws and regulations could have a material impact on GCI.
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In addition, there is regulatory uncertainty with respect to the U.S.’ climate change policy. On January 20, 2025, President Trump signed an executive order to withdraw the U.S. from the Paris Agreement, marking a significant shift in U.S. climate policy. It remains unclear what further actions the current administration may take with respect to domestic and international programs and initiatives, what support the Trump administration would have for any potential changes to such legislative programs and initiatives in Congress, and what the impacts of such changes may be.
GCI does not have insurance to cover certain risks to which it is subject, which could lead to the occurrence of uninsured liabilities.
As is typical in the communications industry, GCI is self-insured for damage or loss to certain of its transmission facilities, including its buried, undersea, and above-ground fiber optic cable systems. If GCI becomes subject to substantial uninsured liabilities due to damage or loss to such facilities, our Company’s financial position, results of operations or liquidity may be adversely affected.
GCI uses third-party vendors for its customer billing systems. Any errors, cyber-attacks or other operational disruption could have adverse operational, financial, and reputational effects on our Company’s business.
GCI’s third-party billing services vendors may experience errors, cybersecurity incidents, or other operational disruptions of their information systems that could negatively impact GCI and over which GCI may have limited control. Interruptions and/or failure of these billing services systems could disrupt GCI’s operations and impact its ability to provide or bill for its services, retain customers, or attract new customers, and negatively impact overall customer experience. Any occurrence of the foregoing could cause material adverse effects on our Company’s operations and financial condition, material weaknesses in its internal control over financial reporting and reputational damage.
Any significant impairment of GCI’s indefinite-lived intangible assets would lead to a reduction in its net operating performance and a decrease in its assets, and have a material adverse effect on GCI’s results of operations and financial condition.
GCI had $812 million of indefinite-lived intangible assets as of December 31, 2025, consisting of goodwill of $638 million, cable certificates of $149 million and other indefinite-lived intangible assets primarily comprised of wireless licenses of $25 million. Goodwill represents the excess of cost over fair value of net assets acquired in connection with business acquisitions and the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition. GCI’s cable certificates represent agreements or authorizations with government entities that allow access to homes in cable service areas, including the future economic benefits of the right to solicit and service potential customers and the right to deploy and market new services to potential customers.
GCI’s wireless licenses are from the FCC and give GCI the right to provide wireless service within a certain geographical area.
If GCI makes changes in its business strategy or if market or other conditions adversely affect its operations or the price of its common stock, it may be forced to record an impairment charge, which would lead to a decrease in its assets and a reduction in its net operating performance. GCI’s indefinite-lived intangible assets are tested annually for impairment during the fourth quarter and at any time upon the occurrence of certain events or substantive changes in circumstances that indicate the assets might be impaired. If the testing performed indicates that impairment has occurred, GCI is required to record an impairment charge for the difference between the carrying value and the fair value of the goodwill and/or the indefinite-lived intangible assets, as appropriate, in the period in which the determination is made. For example, during the third quarter of 2025, GCI recorded impairments in the amounts of $401 million for cable certificates and $16 million for other indefinite-lived intangible assets, and a goodwill impairment in the amount of $108 million. GCI will continue to monitor the Company’s current business performance and stock price versus current and updated long-term forecasts, among other relevant considerations, to determine whether it is more likely than not that the fair value of GCI Liberty is less than its carrying value. Future outlook in revenue, cash flows, or other factors could result in a sustained decrease in fair value that may result in a determination that additional carrying value adjustments are required, which could be material, and GCI could be required to record additional charges on goodwill or other
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indefinite-lived intangible assets in the future, which could have a material adverse effect on GCI’s business, results of operations and financial condition.
The testing of goodwill and indefinite-lived intangible assets for impairment requires GCI to make significant estimates about its future performance and cash flows, as well as other assumptions. These estimates can be affected by numerous factors, including changes in economic, industry, or market conditions, changes in underlying business operations, future operating performance, changes in competition, or changes in technologies. Any changes to key assumptions, or actual performance compared with those assumptions, about GCI’s business and its future prospects or other assumptions could affect the fair value, resulting in an additional impairment charge.
If we are unable to retain key employees, our ability to manage our business could be adversely affected.
Our operational results have depended, and our future results will depend, upon the retention and continued performance of our management team. Our ability to hire and retain key employees for management positions could be impacted adversely by the competitive environment for management talent in the broadband communications and technology industries. The loss of the services of key members of management and the inability to hire, or a delay in hiring, new key employees could adversely affect our ability to manage our business and our future operational and financial results.
We will require a significant amount of cash to service our debt and to meet other obligations. Our ability to service our debt and other obligations will require access to funds, which may be restricted, and we may not be able to obtain additional financing, or refinance or renew our existing indebtedness, on acceptable terms or at all.
We will require a significant amount of cash to service our debt and to meet other obligations. As of December 31, 2025, we had approximately $971 million principal amount of debt outstanding, consisting of (i) GCI, LLC’s 4.750% senior notes due 2028, (ii) term and revolving loans under GCI, LLC’s senior secured credit facility with a syndicate of banks (the “Senior Credit Facility”) and (iii) a note payable to Wells Fargo originally issued by GCI Holdings (the “Wells Fargo Notes Payable”).
Our ability to make payments on and to refinance our debt and to fund planned capital expenditures and potential acquisitions will depend on our ability to access cash, and cash flows from operations may be insufficient to satisfy the respective financial obligations under indebtedness outstanding from time to time, and to arrange additional financing in the future. Accessing cash at operating subsidiaries will depend on those subsidiaries’ individual operating results and any statutory, regulatory or contractual restrictions to which they may be or may become subject. Our other potential sources of cash include available cash balances, dividends and interest from its investments, monetization of public investments, and proceeds from asset sales or capital raises.
Moreover, our ability to secure additional financing will depend upon our operating performance, our credit rating, general economic and credit and equity market conditions, including interest rate levels and the availability of credit generally, the state of competition in our market, the outcome of certain legislative and regulatory issues and financial, business and other factors, many of which are beyond our control. There can be no assurance that sufficient financing will be available, or that we will be able to renew or refinance existing indebtedness, on desirable terms or at all. If financing is not available when needed or is not available on favorable terms, we may be unable to take advantage of business or market opportunities as they arise or it may be necessary for us to curtail, delay or abandon our business growth plans, which could have a material adverse effect on our business and financial condition. Further, if we incur significant additional indebtedness to fund our plans, it could cause a in our credit rating and could increase our borrowing costs or limit our ability to raise additional capital.
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We have significant indebtedness, which could adversely affect our business and financial condition.
As discussed above, as of December 31, 2025, we had approximately $971 million principal amount of debt outstanding. As a result of this significant indebtedness, we may:
experience increased vulnerability to general adverse economic and industry conditions;
be required to dedicate a substantial portion of cash flow from operations to principal and interest payments on our indebtedness, thereby reducing the availability of cash flow to fund working capital, capital expenditures, strategic acquisitions and investments and other general corporate purposes;
be exposed to the risk of increased interest rates with respect to any variable rate portion of indebtedness;
be impeded in our ability to satisfy our obligations with respect to our indebtedness;
be restricted from making strategic acquisitions or required to make non-strategic divestitures;
be exposed to the risk of increased interest rates with respect to any variable rate portion of indebtedness;
be limited in our ability to obtain additional financing for working capital, capital expenditures, product and service development, debt service requirements, acquisitions, and general corporate or other purposes; and
be limited in planning for, or reacting to, changes in our business or market conditions and placing us, including our subsidiaries, at a competitive disadvantage compared to competitors who are less highly leveraged and who, therefore, may be able to take advantage of opportunities that our leverage may prevent us from exploiting.
In addition, it is possible that we may need to incur additional indebtedness in the future.
The agreements that govern our current and future indebtedness may contain various affirmative and restrictive covenants that will limit our discretion in the operation of our business.
The agreements governing our indebtedness contain various covenants that could materially and adversely affect our ability to finance future operations or capital needs and to engage in other business activities that may be in our best interest.
We may also enter into certain other indebtedness arrangements in the future. The instruments governing such indebtedness often contain covenants that, among other things, place certain limitations on a borrower’s ability to incur more debt, exceed specified leverage ratios, pay dividends, make distributions, make investments, repurchase stock, create liens, enter into transactions with affiliates, merge or consolidate, and transfer or sell assets. Any failure to comply with such covenants could result in an event of default, which, if not cured or waived, could have a material adverse effect on our business and financial condition.
The various covenants in existing or future indebtedness may restrict our ability to expand or to pursue business strategies. Our ability to comply with these covenants may be affected by events beyond our and their control, such as prevailing economic conditions and changes in regulations, and if such events occur, we cannot be sure that we, and our subsidiaries, will be able to comply. A breach of these covenants could result in a default under the indenture and/or the credit agreements. If there were an event of default under the indenture and/or the credit agreements, holders of such defaulted debt could cause all amounts borrowed under these instruments to be due and payable immediately. Additionally, if we fail to repay the debt under any secured indebtedness when it becomes due, the lenders under such indebtedness could proceed against the assets that are pledged to them as security. Our assets or cash flow, and our subsidiaries’ assets or cash flow, may not be sufficient to repay borrowings under outstanding debt instruments in the event of a default thereunder.
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Variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly.
Our borrowings under the Senior Credit Facility are at variable rates of interest and expose us to interest rate risk. If interest rates increase, our debt service obligations on the variable rate indebtedness could increase even though the amount borrowed remained the same, and our net income and cash flow could decrease.
In order to manage our exposure to interest rate risk, in the future, we may enter into derivative financial instruments, typically interest rate swaps and caps, involving the exchange of floating for fixed rate interest payments. If we are unable to enter into interest rate swaps, it may adversely affect our cash flow and may impact our ability to make required principal and interest payments on our indebtedness and, even if we use these instruments to selectively manage risks, there can be no assurance that we will be fully protected against material interest rate fluctuations.
Factors Relating to Ownership of Our Common Stock and the Securities Market
Our stock price may fluctuate significantly.
The market price of GCI Group common stock may fluctuate significantly due to a number of factors (none of which can be guaranteed to occur), some of which may be beyond our control, including:
actual or anticipated fluctuations in our operating results;
changes in earnings estimated by securities analysts or our ability to meet those estimates;
the operating and stock price performance of comparable companies; and
domestic and foreign economic conditions.
Our multi-series structure may depress the trading price of the shares of GCI Group common stock.
Our multi-series structure may result in a lower or more volatile market price of the shares of GCI Group common stock or in adverse publicity or other adverse consequences. Several stockholder advisory firms have announced their opposition to the use of multiple-class structures. As a result, the multi-series structure of GCI Group common stock may cause stockholder advisory firms to publish negative commentary about our corporate governance practices or otherwise seek to cause us to change our capital structure. Any actions or publications by stockholder advisory firms critical of our corporate governance practices or capital structure could also adversely affect the value of the shares of GCI Group common stock.
If the GCI Liberty board determines to issue the shares of Ventures Group common stock, GCI Group common stock will become a tracking stock and a tracking stock structure may cause market confusion.
In the Separation, holders of Liberty Broadband common stock on the record date for the distribution only received shares of GCI Group common stock, which currently constitute 100% of the issued and outstanding common equity interest in all of GCI Liberty’s businesses, assets and liabilities, but the GCI Liberty restated articles authorizes the issuance of another group of common stock without the approval of GCI Liberty’s stockholders, the Ventures Group common stock. In the event that GCI Liberty issues Ventures Group common stock, GCI Group common stock will become a tracking stock. A tracking stock is a type of common stock that the issuing company intends to reflect or “track” the economic performance of a particular business or “group,” rather than the economic performance of the company as a whole. In the event that the GCI Group common stock and the Ventures Group common stock become tracking stocks, the GCI Group common stock would be intended to track the economic performance of particular businesses, assets and liabilities of GCI Liberty and its subsidiaries (the “GCI group”) as determined by the GCI Liberty board and the Ventures Group common stock would be intended to track the economic performance of other particular businesses, assets and
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liabilities of GCI Liberty and its subsidiaries (the “Ventures group”) as determined by the GCI Liberty board. GCI Liberty would attribute, for financial reporting purposes, all of its consolidated assets, liabilities, revenue, expenses and cash flows between the GCI group and the Ventures group. However, notwithstanding such attribution, GCI Liberty and its subsidiaries would retain legal title to all of GCI Liberty’s consolidated assets, and GCI Liberty’s tracking stock capitalization would not limit GCI Liberty’s legal responsibility, or that of GCI Liberty’s subsidiaries, for the liabilities included in any set of financial statement schedules.
Holders of GCI Group common stock or Ventures Group common stock would not have any legal rights related to specific assets attributed to their associated group and, in any liquidation, holders of GCI Group common stock and Ventures Group common stock would be entitled to receive a proportionate share of GCI Liberty’s available net assets based on their respective number of liquidation units. Depending on the composition of the assets underlying GCI Liberty’s tracking stock groups from time to time, confusion in the marketplace may occur if holders of GCI Liberty’s tracking stock mistakenly believe they own stock of a company attributed to the applicable tracking stock group or they have any equity or voting interests with respect to companies attributed to one of GCI Liberty’s tracking stock groups.
The GCI Liberty board has discretion to create the Ventures group and to reattribute businesses, assets and liabilities that are attributed to one tracking stock group to another tracking stock group, without the approval of any of GCI Liberty’s stockholders. Any such reattribution made by the GCI Liberty board, as well as the existence, in and of itself, of the right to effect a reattribution, may impact the ability of investors to assess the future prospects of the businesses and assets attributed to a tracking stock group, including liquidity and capital resource needs, based on past performance.
In addition, the assets attributed to one group are potentially subject to the liabilities attributed to another group, even if those liabilities arise from lawsuits, contracts or indebtedness that are attributed to such other group. No provision of the GCI Liberty restated articles prevents GCI Liberty from satisfying liabilities of one group with assets of another group, and GCI Liberty’s creditors will not in any way be limited by GCI Liberty’s tracking stock capitalization from proceeding against any assets they could have proceeded against if GCI Liberty did not have a tracking stock capitalization.
GCI Liberty cannot assure you that the market price of the common stock related to a group will, in fact, reflect the performance of the group of businesses, assets and liabilities attributed to that group. Holders of GCI Group common stock and Ventures Group common stock (if and when issued) will be common stockholders of GCI Liberty as a whole and, as such, will be subject to all risks associated with an investment in GCI Liberty and all of GCI Liberty’s businesses, assets and liabilities. As a result, the market price of each tracking stock may, in part, reflect events that are intended to be reflected or tracked by a different tracking stock of GCI Liberty.
If the GCI Liberty board decides to implement a tracking stock capital structure, such structure could create conflicts of interest, and the GCI Liberty board may make decisions that could adversely affect only some holders of GCI Liberty’s common stock.
If the GCI Liberty board decides to issue the Ventures Group common stock, such tracking stock structure could give rise to occasions when the interests of holders of stock related to one group might diverge or appear to diverge from the interests of holders of stock of the other group. GCI Liberty’s officers and directors owe fiduciary duties to GCI Liberty as a whole and all of GCI Liberty’s stockholders, as opposed to only holders of a particular group. Decisions deemed to be in the best interest of GCI Liberty and all of GCI Liberty’s stockholders may not be in the best interest of a particular group when considered independently.
Holders of shares of stock relating to a particular group may not have any remedies if any action by GCI Liberty’s directors or officers has an adverse effect on only that stock, or on a particular series of that stock.
If the GCI Liberty board decides to implement a tracking stock capital structure, Nevada law and the provisions of the GCI Liberty restated articles may protect decisions of the GCI Liberty board that have a disparate impact upon holders of shares of stock relating to a particular group, or upon holders of any series of stock relating to a particular group. Under Nevada law, the GCI Liberty board has a duty to act with due care and in the best interests of all of GCI Liberty’s
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stockholders, regardless of the stock, or series, they hold. Under Nevada law and the GCI Liberty restated articles, our board of directors owes fiduciary duties to act in good faith and with a view to the interests of GCI Liberty, including the interests of all common stockholders, and does not have separate or additional duties to any subset of those stockholders. There is no statutory or judicial authority in Nevada establishing that decisions by directors or officers involving differing treatment of holders of tracking stocks would be judged by a standard other than Nevada’s statutory business judgment rule. In addition, our board of directors, in acting with a view to the interest of the corporation, may consider other relevant facts, circumstances, contingencies or constituencies, which may include interests beyond those of just the stockholders, such as the interests of employees, customers or creditors, as well as considerations about the economy or society, among other interests. In some circumstances, GCI Liberty’s directors or officers may be required to make a decision that might be viewed as relatively disadvantageous to the holders of shares relating to a particular group or to the holders of a particular series of that stock. Under the principles of Nevada law, including the business judgment rule referred to above, you may not be able to successfully decisions that you believe have a disparate impact upon the stockholders of one of GCI Liberty’s groups if the GCI Liberty board acts through and independent members, in faith and with a view to the interests of GCI Liberty, including all of GCI Liberty’s stockholders and other constituencies which the board is permitted to consider. Additionally, if the presumption that a director or officer so acted is rebutted, it must also be proven that such of a duty involved , or a knowing of law.
GCI Liberty may dispose of its assets, even if they are attributed to a tracking stock group, without stockholder approval (except to the extent such approval is required under Nevada law or GCI Liberty’s restated articles).
Nevada law requires stockholder approval only for a sale or other disposition of all of the property and assets of GCI Liberty taken as a whole, and the GCI Liberty restated articles do not require a separate class vote in the case of a sale of any amount of assets of the tracking stock groups of GCI Liberty. Pursuant to the GCI Liberty restated articles, GCI Liberty may approve sales and other dispositions of any amount of the assets of a tracking stock group without any stockholder approval unless the GCI Liberty board seeks to classify a group disposition (as defined below) as an exempt disposition (as defined below).
If GCI Liberty disposes of all or substantially all of the assets attributed to any group (which means, for this purpose, assets representing at least 80% of the fair market value of the total assets of the disposing group, as determined by the GCI Liberty board), GCI Liberty would be required under the terms of the GCI Liberty restated articles, if the disposition is not an exempt disposition under the terms of the GCI Liberty restated articles, to choose one or more of the following three alternatives:
declare and pay a dividend on the disposing group’s common stock;
redeem shares of the disposing group’s common stock in exchange for cash, securities or other property; and/or
convert all or a portion of the disposing group’s outstanding common stock into common stock of the other group at a specified premium.
Pursuant to the GCI Liberty restated articles, an “exempt disposition” includes the following with respect to each tracking stock group:
the disposition of all or substantially all of GCI Liberty’s assets in connection with the liquidation, dissolution or winding up of GCI Liberty;
a dividend, other distribution or redemption in accordance with the GCI Liberty restated articles;
a disposition of all or substantially all of the assets of such tracking stock group (“group disposition”) to a party controlled by GCI Liberty;
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a group disposition in connection with any disposition of all or substantially all of the assets of such tracking stock group in which GCI Liberty receives equity securities of the purchaser, if a significant portion of the business of such purchaser is similar or complementary to the businesses attributable to such group prior to such disposition; or
a group disposition as to which the GCI Liberty board obtains the requisite approval of the applicable voting stockholders to classify such group disposition as an exempt disposition.
In this type of a transaction, holders of the disposing group’s common stock may receive less value than the value that a third-party buyer might pay for all or substantially all of the assets of the disposing group.
The GCI Liberty board will decide, in its sole discretion, how to proceed, and it is not required to select the option that would result in the highest value to holders of any stock related to a particular group.
The GCI Liberty board may, in its sole discretion, elect to convert the common stock relating to one group into common stock relating to the other group, thereby changing the nature of your investment and possibly diluting your economic interest in GCI Liberty, which could result in a loss in value to you.
The GCI Liberty restated articles permit the GCI Liberty board, in its sole discretion, to convert all of the outstanding shares of common stock relating to one of GCI Liberty’s groups into shares of common stock of the other group on terms described in paragraphs (b)(ii)(iii) of Article IV, Section A.2 of the GCI Liberty restated articles. The foregoing conversion would be made at a ratio based on the relative trading prices of Series C GCI Group common stock (or another series of GCI Group common stock subject to certain limitations) and Series C Ventures Group common stock (or another series of Ventures Group common stock, subject to certain limitations) over a specified 20-trading day period. A conversion would preclude the holders of stock related to each group involved in such conversion from retaining their investment in a security that is intended to reflect separately the performance of the relevant group. GCI Liberty cannot predict the impact on the market value of GCI Liberty’s common stock of (1) the GCI Liberty board’s ability to effect any such conversion or (2) the exercise of this conversion right by the GCI Liberty board. In addition, the GCI Liberty board may effect such a conversion at a time when the market value of GCI Liberty’s different stocks could cause the stockholders of one group to be .
Our multi-series voting structure and potential tracking stock structure may limit your ability to influence corporate matters and future issuances of GCI Group common stock or Ventures Group common stock may further dilute the voting power of shares of GCI Group common stock.
GCI Group common stock is divided into three series of common stock: Series A GCI Group common stock, Series B GCI Group common stock and Series C GCI Group common stock. Holders of record of Series A GCI Group common stock are entitled, and holders of record of Series A Ventures Group common stock, if issued, will be entitled, to one vote for each share of such stock and holders of record of Series B GCI Group common stock are entitled, and holders of record of Series B Ventures Group common stock, if issued, will be entitled, to ten votes for each share of such stock on all matters submitted to a vote of stockholders. Holders of record of Series C GCI Group common stock are not entitled, and holders of record of Series C Ventures Group common stock, if issued, will not be entitled, to any voting rights, except as otherwise required by Nevada law, in which case, each such holder of record of Series C GCI Group common stock or holder of record of Series C Ventures Group common stock will be entitled to 1/100th of a vote per share. Our restated articles do not provide for cumulative voting in the election of directors and permit future issuances of shares of each series of GCI Group common stock, and Ventures Group common stock. Any future issuances of GCI Group common stock and Ventures Group common stock may dilute your interest in our Company and the GCI Group common stock.
Although Series B GCI Group common stock is quoted on the OTC Markets, it is sparsely traded and does not have an active trading market. Only Series A GCI Group common stock shares and Series C GCI Group common stock shares are listed and traded on the Nasdaq Global Select Market. As a result, your ability to purchase Series B GCI Group common stock shares is limited. Future issuances of Series B GCI Group common stock or Series B Ventures Group common stock will dilute the aggregate voting power of the issued and outstanding shares of GCI Group common stock or Ventures Group common stock, respectively, and may further concentrate the aggregate voting power of our issued and
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outstanding shares of common stock among the holders of Series B GCI Group common stock or Series B Ventures Group common stock, respectively. The voting and conversion rights of the Series B GCI Group common stock shares, our ability to issue additional Series B GCI Group common stock shares and your limited ability to purchase Series B GCI Group common stock shares may limit your ability to influence corporate matters and adversely affect the value of Series A GCI Group common stock shares and Series C GCI Group common stock shares.
Holders of the common stock of tracking stock groups will vote together and will have limited separate voting rights.
Holders of the common stock of tracking stock groups will vote together as a single class, except in certain limited circumstances prescribed by the GCI Liberty restated articles or under Nevada law. If GCI Liberty attributes assets, liabilities and businesses to the Ventures group and issues shares of Ventures Group common stock, each share of Series B common stock of each group will have ten votes per share, and each share of Series A common stock of each group will have one vote per share. Holders of Series C common stock of each group will have no voting rights, other than those required under Nevada law and in such case, will have 1/100th of a vote per share. When holders of GCI Group common stock and the Ventures Group common stock vote together as a single class, holders having a majority of the votes will be in a position to control the outcome of the vote even if the matter involves a conflict of interest among GCI Liberty’s stockholders or has a greater impact on one group than another. Except as required under Nevada law, the holders of any shares of any class or series of GCI Liberty capital stock can validly approve a proposal that has been submitted by the GCI Liberty board to the stockholders for approval to amend the GCI Liberty restated articles in any manner that affects one or more classes or series of GCI Group common stock or GCI Liberty non-voting preferred stock (collectively, the “GCI Liberty capital stock”) that has been authorized even if no shares of such class or series of authorized GCI Liberty capital stock is outstanding as of the date of such approval.
For as long as we are an emerging growth company, we will not be required to comply with certain reporting requirements, including disclosures about our executive compensation, that apply to other public companies.
We are classified as an “emerging growth company” under the Jumpstart Our Business Startups Act. As a result, we have reduced Sarbanes-Oxley Act compliance requirements, as discussed elsewhere, for as long as we are an emerging growth company, which may be up to five full fiscal years. Unlike other public companies, we will not be required to, among other things, (i) comply with certain audit-related requirements that we would otherwise be subject to but for our status as an emerging growth company, (ii) provide certain disclosures regarding executive compensation required of larger public companies or (iii) hold nonbinding advisory votes on executive compensation.
To the extent that we rely on any of the exemptions available to emerging growth companies, you will receive less information about our executive compensation and internal control over financial reporting than issuers that are not emerging growth companies. If some investors find GCI Group common stock to be less attractive as a result, there may be a less active trading market for GCI Group common stock and our stock price may be more volatile.
If we are unable to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act, or our internal control over financial reporting is not effective, the reliability of our financial statements may be questioned and our stock price may suffer.
Section 404 of the Sarbanes-Oxley Act requires any company subject to the reporting requirements of the U.S. securities laws to complete a comprehensive evaluation of its and its consolidated subsidiaries’ internal control over financial reporting. To comply with this statute, we are required to document and test our internal control procedures, our management is required to assess and issue a report concerning our internal control over financial reporting, and our independent auditors are required to issue an attestation regarding our internal control over financial reporting. However, as an emerging growth company, we are not required to have our independent auditors attest to the effectiveness of our internal control over financial reporting until our first annual report subsequent to ceasing to be an emerging growth company. As a result, we may not be required to have our independent auditors attest to the effectiveness of our internal control over financial reporting until as late as the annual report for the year ending December 31, 2030. Although we do expect the annual costs to comply with Section 404 to be significant (based on our preliminary assessments), the rules
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governing the standards that must be met for our management to assess our internal control over financial reporting are complex, subject to change, and require significant documentation, testing and possible remediation to meet the detailed standards under the rules. During the course of its testing, our management may identify material weaknesses or deficiencies which may not be remedied in time to meet the deadline imposed by the Sarbanes-Oxley Act. If our management cannot favorably assess the effectiveness of our internal control over financial reporting when we are required to do so or our auditors identify material weaknesses in our internal control, investor confidence in our financial results may weaken, and our stock price may suffer.
It may be difficult for a third party to acquire us, even if doing so may be beneficial to our stockholders.
Certain provisions of our restated articles and bylaws may discourage, delay or prevent a change in control of GCI Liberty that a stockholder may consider favorable. These provisions include the following:
authorizing a capital structure with multiple series of common stock of each group: a Series B share that entitles the holders to ten votes per share, a Series A share that entitles the holders to one vote per share, and a Series C share that, except as otherwise required by applicable law, entitles the holders to no voting rights;
classifying our board of directors with staggered three-year terms, which may lengthen the time required to gain control of our board of directors;
limiting who may call special meetings of stockholders;
prohibiting stockholder action by written consent (subject to certain exceptions), thereby requiring stockholder action to be taken at a meeting of the stockholders;
requiring stockholder approval by holders of at least 66 2∕3% of our voting power with respect to certain extraordinary matters, such as removal of directors, a merger or consolidation, a sale of all or substantially all of our assets or an amendment to our restated articles (except in the event approved by at least 75% of our board of directors);
establishing advance notice requirements for nominations of candidates for election to our board of directors or for proposing matters that can be acted upon by stockholders at stockholder meetings; and
the existence of authorized and unissued stock, including “blank check” preferred stock, which could be issued by our board of directors to persons friendly to its then-current management, thereby protecting the continuity of its management, or which could be used to dilute the stock ownership of persons seeking to obtain control of our Company.
In addition, John C. Malone, our Chairman, currently beneficially owns shares representing the power to direct approximately 53.5% of the aggregate voting power in our company, due to his beneficial ownership of approximately 93.9% of the outstanding shares of our Series B GCI Group common stock as of January 31, 2026, subject to the Malone nonvoting side letter. See the risk factor entitled “ John C. Malone, Chairman of the Board, owns shares of GCI Group common stock representing approximately 53.5% of the aggregate voting power of our Company, as of January 31, 2026. While Mr. Malone’s voting power is currently subject to the Malone nonvoting side letter, his current and potential voting power may be deemed to put him in a position to influence significant corporate actions and may discourage others from initiating a potential change of control transaction that may be beneficial to our stockholders. ” for more information.
Case law in Nevada may be less likely to provide guidance for specific fact scenarios than in Delaware.
We are a Nevada corporation. Because of Delaware’s prominence as a state of incorporation for many large corporations, the Delaware courts have developed considerable expertise in dealing with corporate issues and a substantial body of case law has developed construing Delaware law under certain sets of facts. While Nevada also has adopted
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comprehensive, modern and flexible corporate law statutes, because the volume of Nevada case law concerning the effects of its statutes and regulations is more limited, we may experience, and our stockholders may experience, less predictability with respect to the legal requirements in connection with corporate affairs and transactions, and stockholders’ rights to challenge them in specific situations where the application of the statute may be open to differing interpretations.
Our directors and officers are protected from liability for a broad range of actions.
Nevada law, by default, with certain specific exceptions, eliminates the liability of directors and officers, to a corporation or its stockholders, except where (i) the presumption that such director or officer has acted in good faith, with a view to the interests of the corporation has been rebutted, and (ii) it is proven that such director’s or officer’s act or failure to act was a breach of his or her fiduciary duties and involved intentional misconduct, fraud or a knowing violation of law. Our restated articles provide that, to the fullest extent permitted by Nevada law, our Company’s directors and officers will not be individually liable to the Company or any of its stockholders or creditors for damages as a result of any act or failure to act in his or her capacity as a director or officer.
Our restated articles provide that the Eighth Judicial District Court of the State of Nevada shall be the exclusive forum for certain litigation that may be initiated by our stockholders, and that the federal courts shall be the exclusive forum for claims under the Securities Act of 1933, as amended (the “Securities Act”); these provisions could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.
Our restated articles provide that, subject to limited exceptions, the Eighth Judicial District Court of the State of Nevada in Clark County, Nevada (the “Nevada Eighth Judicial District Court”) (or if the Nevada Eighth Judicial District Court does not have jurisdiction, any other state district court located in the State of Nevada, and if no state district court in the State of Nevada has jurisdiction, any federal court located in the State of Nevada) shall, to the fullest extent permitted by law, be the exclusive forum for certain specified types of “internal actions” as defined under Nevada law, including (a) those brought in the name or right of our Company or on its behalf; (b) those for or based upon a breach of fiduciary duty against any director, officer, employee or agent of our Company in such capacity; (c) those arising pursuant to, or to interpret, apply, enforce or determine the validity of, any provision of the Nevada statutes with respect to business entities, the articles of incorporation or the bylaws of our Company, or certain voting agreements or trusts to which it may be a party.
In addition, our restated articles provide that unless GCI Liberty consents in writing to the selection of an alternative forum, the federal district courts of the U.S. shall be, to the fullest extent provided by law, the exclusive forum for the resolution of any complaint asserting a cause of action under the Securities Act. The GCI Liberty restated articles further provide that, for the avoidance of doubt, this exclusive forum provision will not apply to suits brought to enforce any liability or duty created by the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or any other claim for which the federal courts of the U.S. have exclusive jurisdiction. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. Furthermore, to the fullest extent permitted by law, the GCI Liberty restated articles provide that the federal district courts of the U.S. shall be the forum for the resolution of any asserting a cause of action arising under the Securities Act of 1933, as amended, which creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or rules and regulations thereunder.
These choice of forum provisions may otherwise limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, employees or agents, which may discourage such lawsuits against us and our directors, officers, employees and agents. Stockholders who do bring a claim in the Nevada Eighth Judicial District Court could face additional litigation costs in pursuing any such claim, particularly if they do not reside in or near the State of Nevada. The Nevada Eighth Judicial District Court may also reach different judgments or results than would other courts, including courts where a stockholder considering an action may be located or would otherwise choose to bring the action, and such judgments or results may be more favorable to us than to our stockholders. Similarly, the federal district courts may also reach different judgments in Securities Act cases than state courts. Alternatively, if a court were to find the choice of forum provision contained in our restated articles to be inapplicable or
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unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition.
The holders of any series of GCI Group common stock, or the holders of GCI Group common stock as a whole, may not have any remedies if an action by our directors or officers prioritizes other interests or has a disparate effect on GCI Group common stock or any series thereof.
Principles of Nevada law and the provisions of our restated articles may protect decisions of our board of directors that weigh interests different from those of the holders of GCI Group common stock, or any series thereof, or that have a disparate impact upon holders of any series of GCI Group common stock. Under Nevada law, the board of directors has the duty to exercise its powers in good faith and with a view to the interests of the corporation. In doing so, the board of directors may consider all relevant facts, circumstances, contingencies or constituencies, including, without limitation, the interests of the corporation’s employees, suppliers, creditors or customers; the economy of the state or the nation; the interests of the community or of society; the long-term or short-term interests of the corporation, including the possibility that these interests may be best served by the continued independence of the corporation; or the long-term or short-term interests of the corporation’s stockholders, including the possibility that these interests may be best served by the continued independence of the corporation. Directors may consider or assign weight to the interests of any particular person or group, or to any other relevant facts, circumstances, contingencies or constituencies and are not required to consider, as a dominant factor, the effect of a proposed corporate action upon any particular group or constituency having an interest in the corporation. Under the principles of Nevada law referred to above and the business judgment rule, you may not be in these decisions if a majority of our board of directors, or a committee thereof, is , independent and informed with respect to decisions of the board and acts in faith and with a view to the interests of the corporation, including all of our stockholders.
Although Series B GCI Group common stock is quoted on the OTC Markets, there is no meaningful trading market for the stock.
The shares of Series B GCI Group common stock are not widely held, with approximately 93.9% of the outstanding shares of Series B GCI Group common stock beneficially owned by Mr. Malone as of January 31, 2026. Although Series B GCI Group common stock is quoted on the OTC Markets, it is sparsely traded and does not have an active trading market. The OTC Markets tend to be highly illiquid, in part, because there is no national quotation system by which potential investors can track the market price of shares except through information received or generated by a limited number of broker-dealers that make markets in particular stocks. There is also a greater chance of market volatility for securities that are quoted on the OTC Markets as opposed to a national exchange or quotation system. This volatility is due to a variety of factors, including a lack of readily available price quotations, lower trading volume, the absence of consistent administrative supervision of “bid” and “ask” quotations, and market conditions. Each share of Series B GCI Group common stock is convertible, at any time at the option of the holder, into one share of Series A GCI Group common stock, which is listed and traded on the Nasdaq Global Select Market under the symbol “GLIBA.”
GCI Liberty common stock transactions by our insiders could depress the market price of those stocks.
Sales of, or hedging transactions such as collars relating to, shares of our common stock by our Chairman of the Board of Directors or any of our other directors or executive officers, could cause a perception in the marketplace that the stock price of the relevant shares has peaked or that adverse events or trends have occurred or may be occurring at our Company or the group to which the shares relates. This perception can result notwithstanding any personal financial motivation for these transactions. As a result, insider transactions could depress the market price for shares of our common stock.
