10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-13458

HORIZON KINETICS HOLDING CORPORATION

(Exact name of registrant as specified in its charter)


Delaware		84-0920811
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
470 Park Ave S., New York, New York		10016
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (646) 291-2300

Securities registered pursuant to Section 12(b) of the Exchange Act.


Title of each class	Trading Symbol	Name of exchange on which registered
None	None	None

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of April 30, 2025 the registrant had 18,635,321 shares of its common stock, $0.10 par value per share, outstanding.

CAUTIONARY NOTE ON FORWARD-LOOKING INFORMATION

This Quarterly Report on Form 10-Q (this “Report”) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, in addition to historical information. All statements, other than statements of historical facts, included in this Report that address activities, events, or developments with respect to our financial condition, results of operations, or economic performance that we expect, believe, or anticipate will or may occur in the future, or that address plans and objectives of management for future operations, are forward-looking statements. You can typically identify forward-looking statements by the use of words, such as “will,” “may,” “could,” “should,” “assume,” “project,” “believe,” “anticipate,” “expect,” “intend,” “estimate,” “potential,” “plan,” “target,” “is likely,” and other similar words. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

The forward-looking statements contained in this Report are based on management’s current expectations and are subject to uncertainty and changes in circumstances. We cannot assure you that future developments affecting us will be those that we have anticipated. Forward-looking statements and our performance inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to:

•

Unfavorable market conditions could adversely affect our business in many ways, including by reducing the fees revenue and distributions received from its funds.

•

Certain investments represent a material portion of our total assets. If these investments’ operating or market performance deteriorates for any reason, then the Company’s resulting advisory fees and reputation could be negatively impacted.

•

The Company and our employees may invest in other companies or funds in which its clients also invest, which may create conflicts of interest. Conflicts of interests are also present when the Company receives performance fees.

•

The Company, and the funds and SMAs managed by its subsidiary, are exposed to risks relating to cryptocurrencies and related investments, either directly or through cryptocurrency-linked ETFs.

•

Our success depends highly on its senior executives, and the loss of their services would have a material adverse effect on its business, results and financial condition.

•

Poor performance of our funds would cause a decline in its revenue, income and cash flow and could adversely affect its ability to raise capital for future funds.

•

Our investment philosophy makes a rebalancing of portfolios unlikely, which could result in concentrated positions, adversely impacting our business and reputation if those positions decline.

•

The asset management business is intensely competitive.

•

The capital markets are currently in a period of disruption and economic uncertainty. Such market conditions have materially and adversely affected debt and equity capital markets, which have had, and may continue to have, a negative impact on our business and operations.

We caution you that forward-looking statements are not guarantees of future performance and that actual results or performance may be materially different from those expressed or implied in the forward-looking statements. The forward-looking statements in this Report speak as of the filing date of this Report. Although we may from time to time voluntarily update our prior forward-looking statements, we undertake no obligation to revise any forward-looking statements in order to reflect events or circumstances that may arise after the date of this Report.

TABLE OF CONTENTS


		Page
PART I
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25
Item 3.	Qualitative and Quantitative Disclosure About Market Risk	33
Item 4.	Controls and Procedures	33
PART II
Item 1A.	Risk Factors	34
Item 6.	Exhibits	34

PART I

ITEM 1. FINANCIAL STATEMENTS.

HORIZON KINETICS HOLDING CORPORATION

Condensed Consolidated Statements of Financial Condition

(in thousands)


	March 31,		December 31,
	2025		2024
	(Unaudited)
Assets
Cash and cash equivalents	$	34,872	$	14,446
Fees receivable, net		7,513		8,670
Investments, at fair value		105,342		91,435
Assets of consolidated investment products
Cash and cash equivalents		29,531		44,306
Investments, at fair value		1,746,863		1,746,850
Other assets		33,399		19,247
Other investments		28,276		13,443
Operating lease right-of-use assets		4,612		5,105
Property and equipment, net		88		99
Prepaid expenses and other assets		2,212		2,352
Due from affiliates		-		27
Digital assets		11,474		13,240
Intangible assets, net		44,042		44,531
Goodwill		24,425		24,425
Total assets	$	2,072,649	$	2,028,176

Liabilities, Noncontrolling Interests, and Shareholders’ Equity
Liabilities:
Accounts payable, accrued expenses and other	$	15,248	$	22,011
Accrued third party distribution expenses		690		6,522
Deferred revenue		237		222
Liabilities of consolidated investment products
Accounts payable and accrued expenses		10,924		1,486
Other liabilities		3,606		2,793
Deferred tax liability, net		99,083		95,683
Due to affiliates		7,870		11,597
Operating lease liability		6,748		7,379
Total liabilities		144,406		147,693

Commitments and contingencies (Note 11)

Redeemable noncontrolling interests		1,567,225		1,540,312

Shareholders' equity
Preferred stock, no par value, authorized 20,000 shares; no shares issued and outstanding		-		-
Common stock; $0.10 par value, authorized 50,000 shares; issued and outstanding 18,635 shares, net of treasury stock; 1 share at March 31, 2025 and December 31, 2024, respectively		1,864		1,864
Additional paid-in capital		39,243		39,243
Retained earnings		319,911		299,064
Total shareholders’ equity		361,018		340,171
Total liabilities, noncontrolling interests, and shareholders’ equity	$	2,072,649	$	2,028,176

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements

HORIZON KINETICS HOLDING CORPORATION

Condensed Consolidated Statements of Operations (Unaudited)

(in thousands)


	Three Months Ended March 31,
	2025			2024
				As Restated
Revenue:
Management and advisory fees	$	18,908		$	11,992
Other income and fees		893			139
Total revenue		19,801			12,131

Operating expenses:
Compensation, related employee benefits, and cost of goods sold		9,567			6,346
Sales, distribution and marketing		4,457			2,190
Depreciation and amortization		499			460
General and administrative expenses		2,878			2,642
Expenses of consolidated investment products		1,095			564
Total operating expenses		18,496			12,202

Operating income (loss)		1,305			(71	)

Other income (expense):
Equity earnings, net		3,051			520
Interest and dividends		491			189
Other income (expense)		(51	)		(127	)
Investment and other income (losses) of consolidated investment products, net		70,267			271,900
Interest and dividend income of consolidated investment products		2,904			3,825
Unrealized (loss) gain on digital assets, net		(1,779	)		4,183
Realized gain on investments, net		2,199			192
Unrealized gain (loss) on investments net		13,734			4,679
Total other income (expense), net		90,816			285,361

Income (loss) before provision for income taxes		92,121			285,290

Income tax (expense) benefit		(10,284	)		(1,244	)

Net income	$	81,837		$	284,046
Less: net income attributable to redeemable noncontrolling interests		(58,996	)		(243,205	)

Net income attributable to Horizon Kinetics Holding Corporation	$	22,841		$	40,841

Basic and diluted net income per common shares:
Net income	$	1.23		$	2.27

Weighted average shares outstanding:
Basic and diluted		18,635			17,984

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements

HORIZON KINETICS HOLDING CORPORATION

Condensed Consolidated Statements of Changes in Shareholders' Equity (Unaudited)

(in thousands)


	Common Stock
	Shares		Amount		Capital in Excess of Par		Retained Earnings			Total
Balance at December 31, 2024		18,635	$	1,864	$	39,243	$	299,064		$	340,171
Dividends		-		-		-		(1,994	)		(1,994	)
Net income		-		-		-		22,841			22,841
Balance at March 31, 2025		18,635	$	1,864	$	39,243	$	319,911		$	361,018


Balance at December 31, 2023		17,984	$	1,798	$	-	$	207,290		$	209,088
Cumulative effect of the adoption of ASU 2023-08, net of income taxes		-		-		-		4,369			4,369
Distributions		-		-		-		(1,700	)		(1,700	)
Net income		-		-		-		40,841			40,841
Balance at March 31, 2024		17,984	$	1,798	$	-	$	250,800		$	252,598

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements

HORIZON KINETICS HOLDING CORPORATION

Condensed Consolidated Statements of Cash Flows (Unaudited)

(in thousands)


	Three Months Ended March 31,
	2025			2024
				As Restated
Operating activities:
Net cash used in operating activities	$	(14,480	)	$	(18,915	)

Investing activities:
Proceeds from sale of investments		31,177			74
Issuance of notes to related party		(80	)		-
Deconsolidation of a consolidated investment product		(4,959	)		-
Purchases of investments		(2,019	)		(148	)
Net cash provided by (used in) investing activities		24,119			(74	)

Financing activities:
Dividends		(1,994	)		-
Distributions paid		-			(1,700	)
Contributions from redeemable noncontrolling interests in consolidated investment products		11,190			6,430
Redemptions of redeemable noncontrolling interests in consolidated investment products		(13,184	)		(14,482	)
Net cash used in financing activities		(3,988	)		(9,752	)

Net increase (decrease) in cash and cash equivalents		5,651			(28,741	)

Cash and cash equivalents of HKHC and consolidated investment products, beginning of year		58,752			69,594

Cash and cash equivalents of HKHC and consolidated investment products, end of period	$	64,403		$	40,853

Supplemental disclosure of non-cash investing activities:
Contribution of investment securities for interest in Other investments	$	11,481		$	-

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements

HORIZON KINETICS HOLDING CORPORATION

Notes to Condensed Consolidated Financial Statements (Unaudited)

(in thousands, except per share data)

Note 1. General

The accompanying unaudited interim Condensed Consolidated Financial Statements of Horizon Kinetics Holding Corporation, a Delaware Company (along with its wholly-owned subsidiaries, collectively referred to as the “Company”, “HKHC” or in the first-person notations of “we”, “us” and “our”) were prepared in accordance with accounting principles generally accepted in the United States of America and the interim financial statement rules and regulations of the Securities and Exchange Commission (“SEC”). In the opinion of management, these statements include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the Condensed Consolidated Financial Statements. The interim operating results are not necessarily indicative of the results for a full year or for any interim period. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations relating to interim financial statements. The accompanying Condensed Consolidated Statement of Financial Condition have been derived from the Company's annual financial statements for the year ended December 31, 2024. The Condensed Consolidated Financial Statements included herein should be read in conjunction with the audited consolidated annual financial statements and accompanying notes.

The Condensed Consolidated Financial Statements include the accounts of HKHC and all of its wholly-owned subsidiaries (Horizon Kinetics Asset Management LLC, Kinetics Funds Distributor LLC, KBD Securities LLC and SLG Chemicals, Inc.). All intercompany balances and transactions have been eliminated in consolidation.

The Company and its wholly owned subsidiaries manage or control certain entities that have been consolidated in the accompanying financial statements. These entities include our proprietary funds (collectively, “consolidated investment products” or “CIPs”). Including the results of the consolidated investment products significantly increases the reported amounts of the assets, liabilities, revenues, expenses and cash flows within the accompanying consolidated financial statements. However, the consolidated investment products’ results included herein have no direct effect on the net income attributable to HKHC or to its Stockholders’ Equity. Instead, economic ownership of the investors in the consolidated investment products are reflected as redeemable non-controlling interests in consolidated investment products. Further, cash flows allocable to redeemable non-controlling interests in consolidated investment products are specifically identifiable within the Consolidated Statement of Cash Flows.

Note 2. Restatement of Prior Period Financial Statements and Information

The Company has determined certain proprietary funds should be consolidated pursuant to ASC 810, Consolidation, as a result of our evaluation of these funds following the variable interest entity (“VIE”) model. With this restatement, the assets and liabilities of the consolidated funds are now presented on the Company’s consolidated balance sheet. Additionally, an amount that represents client interests in these consolidated funds is presented as the redeemable noncontrolling interests on the Company’s consolidated balance sheet. The investment income (losses), other income (losses) and the expenses of the consolidated investment products are now presented within the Company’s statement of operations. Additionally, an amount that represents the net income attributable to redeemable noncontrolling interests as well as the net income (loss) attributable to Horizon Kinetics Holding Corporation is also presented on the Company’s statement of operations.

The following presents a reconciliation of the impacted financial statement line items as previously presented for the three months ended March 31, 2024. The previously presented amounts were reflected in the financial statements of Horizon Kinetics LLC and Subsidiaries (a private company), which were filed as Exhibit 99.1 within a Current Report on Form 8-K with the SEC on August 7, 2024. These amounts are labeled as “As previously presented” in the tables below. The amounts labeled “Restatement Adjustments” represent the effects of this restatement due to the consolidation of certain proprietary funds.


	Three Months Ended March 31, 2024
	As Previously Presented		Restatement Adjustments			As Restated
Consolidated Statements of Operations
Revenue:
Management and advisory fees	$	13,915	$	(1,923	)	$	11,992
Total revenue		14,063		(1,932	)		12,131

Operating expenses:
General and administrative expenses		2,663		(21	)		2,642
Expenses of consolidated investment products		-		564			564
Total operating expenses		11,659		543			12,202

Operating income (loss)		2,404		(2,475	)		(71	)

Equity earnings, net		30,571		(30,051	)		520
Investment and other income (losses) of consolidated investment products, net		-		271,900			271,900
Interest and dividend income of consolidated investment products		-		3,825			3,825
Total other income (expense), net		39,681		245,680			285,361

Income (loss) before provision for income taxes		42,085		243,205			285,290

Net income		40,841		243,205			284,046
Less: net income attributable to redeemable noncontrolling interests		-		(243,205	)		(243,205	)

Net income attributable to Horizon Kinetics Holding Corporation	$	40,841	$	-		$	40,841

Note 3. Summary of Significant Accounting Policies

(a) Principles of consolidation

In addition to its wholly-owned subsidiaries, generally accepted accounting principles in the United States of America (“GAAP”) requires that the assets, liabilities and results of operations of a variable interest entity (“VIE”) be consolidated into the financial statements of the enterprise that has a controlling interest in the VIE. The determination as to whether an entity qualifies as a VIE depends on the facts and circumstances surrounding each entity, and therefore certain of the investment vehicles managed by the Company may qualify as VIEs under the variable interest model, whereas others may qualify as voting interest entities

(“VOEs”) under the voting interest model. The Company first evaluates whether it holds a variable interest in an entity. Fees that are customary and commensurate with the level of services provided, and where the Company does not hold other economic interests in the entity that would absorb more than an insignificant amount of the expected losses or returns of the entity, would not be considered a variable interest. The Company factors in all economic interests including proportionate interests through related parties, to determine if such interests are considered a variable interest.

The determination of whether to consolidate a VIE under US GAAP requires a significant amount of judgment concerning the degree of control over an entity by its holders of variable interests. To make these judgments, we conduct an analysis, on a case-by-case basis, of whether we are the primary beneficiary and are therefore required to consolidate an entity. We continually reconsider whether we should consolidate a VIE. Upon the occurrence of certain events, such as modifications to organizational documents and investment management agreements of our products, we will reconsider our conclusion regarding the status of an entity as a VIE. Our judgment when analyzing the status of an entity and whether we consolidate an entity could have a material impact on individual line items within our consolidated financial statements, as a change in our conclusion would have the effect of grossing up the assets, liabilities, revenues and expenses of the entity being evaluated. In light of certain direct and indirect investments into our products, the likelihood of a reasonable change in our estimation and judgment could result in a change in our conclusions to consolidate or not consolidate any VIEs to which we have exposure.

(b) Use of estimates

The preparation of the consolidated condensed financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. These estimates include the evaluation of the recoverability of the Company’s ownership interests and advances, the recoverability of deferred tax assets, certain fair value estimates and commitments and contingencies. Management evaluates its estimates on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances.

The Company believes that its cash and cash equivalents will be sufficient to fund operations past one year from the issuance of these condensed consolidated financial statements.

(d) Digital assets

The Company measures digital assets at fair value with changes recognized in earnings in each reporting period. The Company tracks its cost basis of digital assets in accordance with first-in-first-out method of accounting.

The Company’s digital assets are all Level 1 within the fair value hierarchy, except for certain other assets with a fair value of $2 that are Level 2.

The following tables present additional information about the Company’s digital assets as of March 31, 2025 and December 31, 2024, respectively:


	March 31, 2025						December 31, 2024
	Units Held		Cost Basis		Fair Value		Units Held		Cost Basis		Fair Value
Bitcoin		131	$	1,702	$	10,833		131	$	1,688	$	12,239
Litecoin		1,228		139		102		1,218		138		126
Ethereum		176		53		320		176		53		585
Bitcoin Cash		239		73		73		234		70		101
All others				34		146				39		189
			$	2,001	$	11,474			$	1,988	$	13,240


	Balance at December 31, 2024		Revenue recognized		Proceeds and in-kind transfers			Unrealized gain (loss)			Balance at March 31, 2025
Bitcoin
Units		131		-		-			-			131
Amount	$	12,239	$	14	$	-		$	(1,420	)	$	10,833
Litecoin
Units		1,218		10		-			-			1,228
Amount	$	126	$	1	$	-		$	(25	)	$	102
Ethereum
Units		176		-		-			-			176
Amount	$	585	$	-	$	-		$	(265	)	$	320
Bitcoin Cash
Units		234		5		-			-			239
Amount	$	101	$	3	$	-		$	(31	)	$	73
All others
Amount	$	189	$	10	$	(10	)	$	(43	)	$	146

The following tables present additional information about digital assets held in CIPs as of March 31, 2025 and December 31, 2024, respectively:


	March 31, 2025						December 31, 2024
	Units Held		Cost Basis		Fair Value		Units Held		Cost Basis		Fair Value
Bitcoin		1,926	$	11,295	$	158,946		1,936	$	11,374	$	180,770
Bitcoin Cash		15,120		6,624		4,589		15,120		6,624		6,552
Ethereum		18,923		403		739		18,923		403		1,245
Litecoin		45,196		3,569		3,749		45,196		3,569		4,658
Ripple		516,187		240		1,079		516,187		240		1,073
All others				559		186				560		267
			$	22,690	$	169,288			$	22,770	$	194,565


	Balance at December 31, 2024		Purchases		Proceeds and in-kind transfers			Unrealized gain (loss)			Balance at March 31, 2025
Bitcoin
Units		1,936		-		(10	)		-			1,926
Amount	$	180,770	$	-	$	(987	)	$	(20,837	)	$	158,946
Bitcoin Cash
Units		15,120		-		-			-			15,120
Amount	$	6,552	$	-	$	-		$	(1,963	)	$	4,589
Ethereum
Units		18,923		-		-			-			18,923
Amount	$	1,245	$	-	$	-		$	(506	)	$	739
Litecoin
Units		45,196		-		-			-			45,196
Amount	$	4,658	$	-	$	-		$	(909	)	$	3,749
Ripple
Units		516,187		-		-			-			516,187
Amount	$	1,073	$	-	$	-		$	6		$	1,079
All others
Amount	$	267	$	-	$	-		$	(81	)	$	186

(e) Investments, at fair value

The Company invests in securities which are valued at fair value with unrealized gains and losses included in the condensed consolidated statement of operations. Realized gains and losses are determined on the basis of specific identification.

(f) Other Investments

For investments in entities over which the Company exercises significant influence, but which do not meet the requirements for consolidation and for which the Company has not elected the fair value option, the Company uses the equity method of accounting, whereby the Company records its share of the underlying income or loss of such entities. The Company’s share of the underlying net income or loss of such entities is recorded in equity in earnings of affiliated investments on the condensed consolidated statement of operations. As the underlying entities that the Company manages and invests in are, for U.S. GAAP purposes, primarily investment companies accounted for under Accounting Standards Codification (“ASC”) Topic 946 which reflect their investments at fair value, the carrying value of the Company’s equity method investments in such entities approximates fair value.

We account for other investments that are not accounted for under the equity method that do not have a readily determinable fair value under the fair value measurement alternative. Under the fair value measurement alternative, these investments are based on our original cost less impairments, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar interests of the same issuer. Under this method, our share of the income or losses of such companies is not included in our Consolidated Statements of Operations, however, the result of observable price changes, if any, are reflected in Other

income (loss), net. We include the carrying value of these investments in Investments in proprietary funds on the Condensed Consolidated Balance sheets.

The Company’s other investments consist of the following as of March 31, 2025 and December 31, 2024, respectively:


	March 31, 2025		December 31, 2024
Horizon Kinetics Hard Assets, LLC	$	24,190	$	11,299
Consensus Mining & Seigniorage Corporation		692		737
Other miscellaneous investments		3,394		1,407
	$	28,276	$	13,443

(g) Fair value measurements:

The Company values certain of its financial assets and liabilities based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Accounting guidance emphasizes that fair value is a market-based measurement that should be determined based on the assumptions market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, accounting guidance establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) the reporting entity's own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). Valuation techniques used to measure fair value shall maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels, as follows:

Level 1 Unadjusted quoted prices in active markets for identical instruments. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these investments does not entail a significant degree of judgment.

Level 2 Valuations based on quoted prices for similar or identical instruments in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level 3 Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

The fair value hierarchy guidance gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs.

(h) Revenue Recognition

The Company recognizes revenue under Financial Accounting Standards Board's (“FASB”) Accounting Standards Update (“ASU”) 2014-09, Revenue From Contracts With Customers (Topic 606). The Company recognizes revenue when the performance obligation is satisfied, which is the point at which control of the promised goods or services are transferred to its customers, in an amount that reflects the consideration the Company expects to be entitled to receive in exchange for those goods or services.

Management fees, which are generally calculated as a percentage of assets under management, are recognized when earned and collection is probable. Certain contracts for management services also provide for performance-based fees (“Incentive Fees”).

Incentive Fee revenue is recorded when earned by the fund managers of those managed funds to the extent that Return Thresholds have been met and it is probable that a significant reversal of revenue will not occur. These customer contracts require the Company to provide investment management services over a period of time, which represents a performance obligation that the Company satisfies over time. Management fees are a form of variable consideration because the fees that the Company is entitled to vary based on fluctuations in the basis for the management fee. The amount recorded as revenue is generally determined at the end of the period because these management fees are payable on a regular basis (typically monthly) and are not subject to claw back once paid. Management and advisory fees, including Incentive Fees, from consolidated proprietary funds are eliminated in consolidation. The Company earned $0.3 million and $0.6 of Incentive Fees for the three months ended March 31, 2025 and 2024, respectively, from proprietary funds that were eliminated as a result of the consolidation of the respective funds.

The following table disaggregates our management services revenue by type:


	Three months ended March 31,
	2025		2024
			As Restated
Mutual fund management fees	$	9,888	$	4,901
ETF management fees		2,465		1,397
Separately managed account management fees		6,348		5,728
Proprietary fund management fees		207		(34	)
Total management and advisory fees	$	18,908	$	11,992

The following table presents balances of management fees receivable by type:


	March 31, 2025		December 31, 2024
Mutual fund management fees	$	3,394	$	3,233
ETF management fees		841		830
Separately managed account management fees		2,413		2,220
Proprietary fund management fees		377		1,866
Other		488		521
	$	7,513	$	8,670

(i) Other revenue

The Company generates revenue from sales of consumer products. Consumer product revenue contracts are identified when purchase orders are received and accepted from customers and represent a single performance obligation to sell our products to a customer, and are recorded net of expected customer allowances and promotional programs. Net revenues are recorded at the time that control of the products is transferred to customers.

The Company produces investment research reports for individual and institutional research clients. In addition, the Company retains a third-party marketing firm to market and distribute its research reports. Clients subscribe at a monthly, annual or multi-annual level. Income is accrued monthly based on current subscription base.

(j) Third party distribution

The Company has agreements in place with several third-party distribution firms and individual marketers (“Marketers”). Generally, each party to the agreement may terminate the agreement in a short notice period. Third party distribution expenses are earned by the Marketers based on revenue earned from some of the Company’s investment products generated by the respective Marketers. Accrued third party distribution expenses represent expenses that have been accrued but not paid. In the event that related fees receivable are deemed uncollectible, both related fees receivable and accrued third party distribution expenses will be written off.

(k) Income taxes

Income taxes reflect the tax effects of transactions reported in the Condensed Consolidated Financial Statements and consist of taxes currently payable plus deferred income taxes related to certain income and expenses recognized in different periods for financial and income tax reporting purposes. Deferred income tax assets and liabilities are recognized for the future income tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax bases. A valuation allowance is established when it is more-likely-than-not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the period in which related temporary differences become deductible. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

Taxes are reported based on tax positions that meet a more-likely-than-not standard and that are measured at the amount that is more-likely-than-not to be realized. Differences between financial and tax reporting which do not meet this threshold are required to be recorded as unrecognized tax benefits or expense. We classify penalty and interest expense related to income tax liabilities as an income tax expense. There are no significant interest and penalties recognized in the Consolidated Statements of Operations or accrued on the Consolidated Balance Sheets.

(l) Recently issued accounting pronouncements

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU No. 2023-09 establishes incremental disaggregation of income tax disclosures pertaining to the effective tax rate reconciliation and income taxes paid. This standard is effective for fiscal years beginning after December 15, 2024, and requires prospective application with the option to apply it retrospectively. We intend to adopt this standard in our Annual Report on Form 10-K for the year ending December 31, 2025. We are currently evaluating the potential impact of adopting this standard on our disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses and in January 2025, the FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses: Clarifying the Effective Date. ASU 2024-03 requires public business entities to disclose in the notes to the financial statements, among other things, specific information about certain costs and expenses including purchases of inventory; employee compensation; and depreciation, amortization and depletion expenses for each caption on the income statement where such expenses are included. ASU 2024-03, as clarified by ASU 2025-01, is effective for annual periods beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027. We are currently evaluating the potential impact of adopting this standard on our disclosures.

Note 4. Investments, at Fair Value

As of March 31, 2025 the Company owned investments in marketable securities with a fair value of $105,342.

The following summarizes the Company’s investments accounted for at fair value at March 31, 2025 using the fair value hierarchy:


	March 31, 2025
	Total			Level 1			Level 2		Level 3
Money market cash equivalents	$	-		$	-		$	-	$	-

Investments:
Texas Pacific Land Corporation	$	76,447		$	76,447		$	-	$	-
Kinetics Market Opportunities Fund		9,134			-			9,134		-
Kinetics Spin-Off and Corporate Restructuring Fund-Institutional Class		4,326			-			4,326		-
All other market traded equity securities		2,508			2,508			-		-
Kinetics Mutual Funds and ETFs		3,444			-			3,444		-
Kinetics Global Fund No Load Class		2,227			-			2,227		-
Grayscale Bitcoin Trust		2,087			2,087			-		-
CBOE Global Markets		2,227			2,227			-		-
FRMO Corporation		1,612			-			1,612		-
SPAC Active ETF		1,360			-			1,360		-
Total investments	$	105,372		$	83,269		$	22,103	$	-
Liabilities:
Market traded equity securities - sold short	$	(30	)	$	(30	)	$	-	$	-
Total liabilities	$	(30	)	$	(30	)	$	-	$	-
Total investments, at fair value	$	105,342		$	83,239		$	22,103	$	-

The following summarizes the Company’s investments accounted for at fair value at December 31, 2024 using the fair value hierarchy:


	December 31, 2024
	Total			Level 1			Level 2		Level 3
Money market cash equivalents	$	7,561		$	7,561		$	-	$	-

Investments:
Texas Pacific Land Corporation common stock	$	63,797		$	63,797		$	-	$	-
Kinetics Market Opportunities Fund		8,302			-			8,302		-
Kinetics Spin-Off and Corporate Restructuring Fund-Institutional Class		3,598			-			3,598		-
All other market traded equity securities		2,900			2,900			-		-
Kinetics Mutual Funds and ETFs		2,419			-			2,419		-
Kinetics Global Fund No Load Class		2,416			-			2,416		-
Grayscale Bitcoin Trust		2,370			2,370			-		-
CBOE Global Markets		1,921			1,921			-		-
FRMO Corporation common stock		1,916			-			1,916		-
SPAC Active ETF		1,828			-			1,828		-
Total investments	$	91,467		$	70,988		$	20,479	$	-
Liabilities:
Market traded equity securities - sold short	$	(32	)	$	(32	)	$	-	$	-
Total liabilities	$	(32	)	$	(32	)	$	-	$	-
Total investments, at fair value	$	91,435		$	70,956		$	20,479	$	-

The following summarizes Consolidated Investment Products (“CIPs”) measured at fair value on a recurring basis were as follows as of March 31, 2025 using the fair value hierarchy:


	March 31, 2025
	Total			Level 1			Level 2		Level 3		NAV as a practical expedient
Money market cash equivalents	$	25,027		$	25,027		$	-	$	-	$	-

Investments:
Common stocks	$	936,146		$	936,146		$	-	$	-	$	-
Debt securities		1,462			-			-		1,462		-
Digital asset related exchange-traded and mutual funds		441,143			438,479			2,664		-		-
Preferred stocks		3,738			3,738			-		-		-
Private equity funds		233			-			-		-		233
Private placements		194,853			1,150			1,504		192,197		2
Digital assets		169,288			169,288			-		-		-
Total investments	$	1,746,863		$	1,548,801		$	4,168	$	193,659	$	235

Liabilities:
Securities sold short	$	(428	)	$	(428	)	$	-	$	-	$	-
Total liabilities	$	(428	)	$	(428	)	$	-	$	-	$	-
Total investments, at fair value	$	1,746,435		$	1,548,373		$	4,168	$	193,659	$	235

The following summarizes CIPs measured at fair value on a recurring basis were as follows as of December 31, 2024 using the fair value hierarchy:


	December 31, 2024
	Total			Level 1			Level 2		Level 3		NAV as a practical expedient
Money market cash equivalents	$	28,466		$	28,466		$	-	$	-	$	-

Investments:
Common stocks	$	803,626		$	803,626		$	-	$	-	$	-
Debt securities		1,649			-			-		1,649		-
Digital asset related exchange-traded and mutual funds		541,346			533,435			7,911		-		-
Preferred stocks		3,785			3,785			-		-		-
Preferred equity and other private investments		22,471			-			-		22,471		-
Private equity funds		220			-			-		-		220
Private placements		179,754			-			-		179,752		2
Digital assets		194,565			194,565			-		-		-
Total investments	$	1,747,416		$	1,535,411		$	7,911	$	203,872	$	222

Liabilities:
Securities sold short	$	(566	)	$	(566	)	$	-	$	-	$	-
Total liabilities	$	(566	)	$	(566	)	$	-	$	-	$	-
Total investments, at fair value	$	1,746,850		$	1,534,845		$	7,911	$	203,872	$	222

Changes in Level 3 Assets were as follows:


for the three months ended March 31, 2025	Debt securities			Preferred equity and other private investments			Private placements		Total Level 3 Assets
Balance at December 31, 2024	$	1,649		$	22,471		$	179,752	$	203,872
Change in unrealized appreciation (depreciation), net		(187	)		-			8,891		8,704
Deconsolidation		-			(22,471	)		-		(22,471	)
Purchases		-			-			3,554		3,554
Sales		-			-			-		-
Balance at March 31, 2025	$	1,462		$	-		$	192,197	$	193,659

Change in unrealized gains (losses) included in net income relating to assets held at end of period	$	(187	)	$	-		$	8,891	$	8,704


for the three months ended March 31, 2024	Debt securities		Preferred equity and other private investments			Private placements			Total Level 3 Assets
Balance at December 31, 2023	$	765	$	22,240		$	156,648		$	179,653
Change in unrealized appreciation (depreciation), net		499		-			(16,085	)		(15,586	)
Purchases		-		1,035			5,650			6,685
Sales		-		(13	)		-			(13	)
Balance at March 31, 2024	$	1,264	$	23,262		$	146,213		$	170,739

Change in unrealized gains (losses) included in net income relating to assets held at end of period	$	499	$	-		$	(16,085	)	$	(15,586	)

Valuation techniques and significant unobservable inputs used in Level 3 fair value measurements were as follows:


as of March 31, 2025	Fair Value		Valuation Technique	Significant Unobservable Inputs
Debt securities	$	1,462	Market Approach
Private placements	$	192,197
		8,679	Market Approach - Most recent transaction price	Unit price/cost of latest round of financing
		28,991	Discounted Cash Flow Method, Market Approach and Subject Company Transaction Method	Discount Rate (13.3%) Projected Future Cash Flows Revenue Multiples (range 4.0x - 5.5x) EBITDA Multiples (range 12.5x - 14.5x) Cost of Capital 13.3%
		154,527	Discounted Cash Flow Method and Market Approach	Projected Future Cash Flows Revenue Multiples (range 4.0x - 6.8x) Cost of Capital 13.5%


as of December 31, 2024	Fair Value		Valuation Technique	Significant Unobservable Inputs
Debt securities	$	1,649	Market Approach
Preferred equity and other private investments	$	22,471
		15,236	Market Approach
		7,078	Market Approach	Offered quotes
		157	Income Approach	Capitalization rate range (7.3% - 7.5%)
Private placements	$	179,752
		8,682	Market Approach - Most recent transaction price	Unit price/cost of latest round of financing
		25,517	Discounted Cash Flow Method, Market Approach and Subject Company Transaction Method	Discount Rate (13.5%) Projected Future Cash Flows Revenue Multiples (range 3.8x - 5.5x) EBITDA Multiples (range 12.5x - 14.5x) Cost of Capital 13.5%
		145,553	Discounted Cash Flow Method and Market Approach	Projected Future Cash Flows Revenue Multiples (range 4.0x - 6.8x) Cost of Capital 13.5%

1 Based on the relative fair value of the investments

Note 5. Consolidated Investment Products

CIPs consist primarily of private proprietary investment funds which are sponsored by the Company. The Company has no right to the CIPs assets, other than its direct equity investments in them and investment management and other fees earned from them. The liabilities of the CIPs have no recourse to the Company’s assets beyond the level of its direct investment, therefore the Company bears no other risks associated with the CIPs liabilities.

The following supplemental condensed financial information illustrates the consolidating effects of the CIPs on the Company’s financial condition and results of operations as of and for the three months ended March 31, 2025 and 2024, respectively:


	March 31, 2025
	Consolidated Company Entities		Consolidated Investment Products		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	34,872	$	-	$	-		$	34,872
Fees receivable		9,320		-		(1,807	)		7,513
Investments, at fair value		105,342		-		-			105,342
Assets of consolidated investment products		-		-		-
Cash and cash equivalents		-		29,531		-			29,531
Investments, at fair value		-		1,746,863		-			1,746,863
Other assets		-		33,399		-			33,399
Other investments		254,500		-		(226,224	)		28,276
Digital assets		11,474		-		-			11,474
Intangible assets, net		44,042		-		-			44,042
Goodwill		24,425		-		-			24,425
Other assets		6,919		-		(7	)		6,912
Total assets	$	490,894	$	1,809,793	$	(228,038	)	$	2,072,649

Liabilities, Noncontrolling Interests, and Shareholders’ Equity
Liabilities:
Accounts payable, accrued expenses and other	$	15,248	$	-	$	-		$	15,248
Accrued third party distribution expenses		690		-		-			690
Deferred revenue		237		-		-			237
Liabilities of consolidated investment products		-		-		-
Accounts payable and accrued expenses		-		12,737		(1,813	)		10,924
Due to affiliates		-		-		-			-
Other liabilities		-		3,606		-			3,606
Deferred tax liability, net		99,083		-		-			99,083
Due to affiliates		7,870		-		-			7,870
Operating lease liability		6,748		-		-			6,748
Total liabilities		129,876		16,343		(1,813	)		144,406
Commitments and contingencies

Redeemable noncontrolling interests				1,606,801		(39,576	)		1,567,225

Equity interests		361,018		186,649		(186,649	)		361,018
Total liabilities, noncontrolling interests, and shareholders’ equity	$	490,894	$	1,809,793	$	(228,038	)	$	2,072,649


	Three months ended March 31, 2025
	Consolidated Company Entities			Consolidated Investment Products			Eliminations			Consolidated
Revenue:
Management and advisory fees	$	21,145		$	-		$	(2,237	)	$	18,908
Other income and fees		893			-			-			893
Total revenue		22,038			-			(2,237	)		19,801

Operating expenses:
Compensation, related employee benefits, and cost of goods sold		9,567			-			-			9,567
Sales, distribution and marketing		4,457			-			-			4,457
Depreciation and amortization		499			-			-			499
General and administrative expenses		2,914			-			(36	)		2,878
Expenses of consolidated investment products		-			1,059			36			1,095
Total operating expenses		17,437			1,059			-			18,496

Operating income		4,601			(1,059	)		(2,237	)		1,305

Other income (expense):
Equity in earnings of proprietary funds, net		13,930			-			(10,879	)		3,051
Interest and dividends		491			-			-			491
Other income (expense)		(51	)		-			-			(51	)
Investment and other income (losses) of consolidated investment products, net		-			70,267			-			70,267
Interest and dividend income of consolidated investment products		-			2,904			-			2,904
Unrealized (loss) gain on digital assets, net		(1,779	)		-			-			(1,779	)
Realized gain on investments, net		2,199			-			-			2,199
Unrealized gain (loss) on investments net		13,734			-			-			13,734
Total other income (expense), net		28,524			73,171			(10,879	)		90,816

Income (loss) before provision for income taxes		33,125			72,112			(13,116	)		92,121

Income tax (expense) benefit		(10,284	)		-			-			(10,284	)

Net income (loss)	$	22,841		$	72,112		$	(13,116	)	$	81,837
Less: net income attributable to redeemable noncontrolling interests		-			(61,154	)		2,158			(58,996	)

Net income (loss) attributable to Horizon Kinetics Holding Corporation	$	22,841		$	10,958		$	(10,958	)	$	22,841


	December 31, 2024
	Consolidated Company Entities		Consolidated Investment Products		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	14,446	$	-	$	-		$	14,446
Fees receivable		59,047		-		(50,377	)		8,670
Investments, at fair value		91,435		-		-			91,435
Assets of consolidated investment products
Cash and cash equivalents		-		44,306		-			44,306
Investments, at fair value		-		1,746,850		-			1,746,850
Other assets		-		19,247		-			19,247
Other investments		228,870		-		(215,427	)		13,443
Digital assets		13,240		-		-			13,240
Intangible assets, net		44,531		-		-			44,531
Goodwill		24,425		-		-			24,425
Other assets		7,591		-		(8	)		7,583
Total assets		483,585		1,810,403		(265,812	)		2,028,176

Liabilities, Noncontrolling Interests, and Shareholders’ Equity
Liabilities:
Accounts payable, accrued expenses and other	$	22,011	$	-	$	-		$	22,011
Accrued third party distribution expenses		6,522		-		-			6,522
Deferred revenue		222		-		-			222
Liabilities of consolidated investment products									-
Accounts payable and accrued expenses		-		1,494		(8	)		1,486
Due to affiliates		-		50,375		(50,375	)		-
Other liabilities		-		2,793		-			2,793
Deferred tax liability, net		95,683		-		-			95,683
Due to affiliates		11,597		-		-			11,597
Operating lease liability		7,379		-		-			7,379
Total liabilities		143,414		54,662		(50,383	)		147,693
Commitments and contingencies

Redeemable noncontrolling interests		-		1,574,414		(34,102	)		1,540,312

Equity interests		340,171		181,327		(181,327	)		340,171
Total liabilities, noncontrolling interests, and shareholders’ equity	$	483,585	$	1,810,403	$	(265,812	)	$	2,028,176


	Three months ended March 31, 2024
	Consolidated Company Entities			Consolidated Investment Products			Eliminations			Consolidated
Revenue:
Management and advisory fees	$	13,916		$	-		$	(1,924	)	$	11,992
Other income and fees		139			-			-			139
Total revenue		14,055			-			(1,924	)		12,131

Operating expenses:
Compensation, related employee benefits, and cost of goods sold		6,346			-			-			6,346
Sales, distribution and marketing		2,190			-			-			2,190
Depreciation and amortization		460			-			-			460
General and administrative expenses		2,660			-			(18	)		2,642
Expenses of consolidated investment products		-			546			18			564
Total operating expenses		11,656			546			-			12,202

Operating income		2,399			(546	)		(1,924	)		(71	)

Other income (expense):
Equity in earnings of proprietary funds, net		30,570			-			(30,050	)		520
Interest and dividends		189			-			-			189
Other income (expense)		(127	)		-			-			(127	)
Investment and other income (losses) of consolidated investment products, net		-			271,900			-			271,900
Interest and dividend income of consolidated investment products		-			3,825			-			3,825
Unrealized (loss) gain on digital assets, net		4,183			-			-			4,183
Realized gain on investments, net		192			-			-			192
Unrealized gain (loss) on investments net		4,679			-			-			4,679
Total other income (expense), net		39,686			275,725			(30,050	)		285,361

Income (loss) before provision for income taxes		42,085			275,179			(31,974	)		285,290

Income tax (expense) benefit		(1,244	)		-			-			(1,244	)

Net income (loss)	$	40,841		$	275,179		$	(31,974	)	$	284,046
Less: net income attributable to redeemable noncontrolling interests		-			(245,710	)		2,505			(243,205	)

Net income (loss) attributable to Horizon Kinetics Holding Corporation	$	40,841		$	29,469		$	(29,469	)	$	40,841

Note 6. Related Party Transactions

As of March 31, 2025 and December 31, 2024, amounts due to or due from the Company to related party affiliates is summarized as follows:


	March 31, 2025				December 31, 2024
	Receivable		Payable		Receivable		Payable
Horizon Common Inc.	$	-	$	6,948	$	-	$	6,948
Proprietary funds		-		-		27		-
FRMO Corporation		-		922		-		4,649
	$	-	$	7,870	$	27	$	11,597

For the three months ended March 31, 2025 and 2024, amounts recognized from related party affiliates is summarized as follows:


	Three Months Ended March 31,
	2025				2024
	Revenues		Expenses		Revenues		Expenses
Proprietary funds	$	207	$	-	$	-	$	-
FRMO Corporation		4		922		2		543
Consensus Mining & Seigniorage Corp		3		-		3		-
Other		-		3		-		3
	$	214	$	925	$	5	$	546

Certain co-founders of the Company are also shareholders of FRMO Corporation (“FRMO”). FRMO has a right to a 4.2% share of the Company’s gross revenue (prior to any commission sharing agreements) and a 4.4% ownership interest. The Company’s expenses under this agreement are included with Sales, distribution and marketing expenses in the condensed consolidated statement of operations.

The Company has waived, or provides discounted management and advisory fees, for assets under management in proprietary funds or separately managed accounts for Shareholders’ and their direct families, FRMO, Horizon Common Inc., Kinetics Holding Corporation and employees of the Company.

The Company owns an equity interest and has advanced funds in exchange for notes receivable to HM Tech, a service provider for digital asset mining operations. The Company has also agreed to guarantee a $0.3 million Promissory Note receivable from HM Tech LLC issued to Consensus Mining & Seigniorage Corporation in the event of default.

Note 7. Earnings per Share

Per share data is determined by using the weighted average number of common shares outstanding. Common equivalent shares are considered only for diluted earnings per share, unless considered anti-dilutive. Common equivalent shares, determined using the treasury stock method, result from stock options with exercise prices that are below the average market price of the common stock.

Basic earnings per share include no dilution and are computed by dividing income available to common shareholders by the weighted-average number of shares outstanding during the period. Diluted earnings per share reflect the potential of securities that could share in our earnings.

Common stock equivalents that have been excluded from the calculation of earnings per share because they would have been anti-dilutive are de minimis for the three months ended March 31, 2025 and 2024, respectively, and have no impact on diluted earnings per share.

Note 8. Segment Information

We operate in two operating segments: asset management and consumer products. We have chosen to organize our business around these segments based on 1) differences in the products and services sold, 2) the availability of discrete financial information, and 3) the reports that are regularly reviewed by the chief operating decision maker for the purpose of assessing performance and allocating resources. Accounting policies for our segments are the same as those described in Note 3. We evaluate segment performance based on several factors, including income or loss before the provision for income taxes.

The following provides information on our segments for the three months ended March 31, 2025 and 2024, respectively:


	Three Months Ended March 31, 2025										Three Months Ended March 31, 2024
	Asset Management		Consumer Products			Reconciling Amounts			Total		Asset Management		Reconciling Amounts			Total
Revenue	$	21,145	$	802		$	(2,146	)	$	19,801	$	13,916	$	(1,785	)	$	12,131
Significant segment expense		9,109		458			-			9,567		6,346		-			6,346
Depreciation and amortization		437		62			-			499		460		-			460
All other segment expenses		7,371		709			-			8,080		4,711		563			5,274
Operating income (loss)	$	4,601	$	(427	)	$	(2,869	)	$	1,305	$	2,399	$	(2,470	)	$	(71	)

Identifiable assets	$	490,894	$	5,550		$	1,576,205		$	2,072,649	$	490,894	$	906,219		$	1,397,113

Geographic Area Information

As of March 31, 2025 and December 31, 2024, all of the Company’s assets were located in the United States of America. There were no revenues from outside the United States for the three months ended March 31, 2025 or 2024, respectively.

Note 9. Income Taxes

The Company’s income tax provision includes corporate income taxes and other entity level income taxes, as well as income taxes incurred by certain affiliated funds that are consolidated in these financial statements. Income tax (expense) benefit for three months ended March 31, 2025 and 2024 was $(10,284) and $(1,244), respectively.

The Company’s effective income tax rate is dependent on many factors, including the estimated nature and amounts of income and expenses allocated to the non-controlling interests without being subject to federal, state and local income taxes at the corporate level. Additionally, the Company’s effective tax rate is influenced by the amount of income tax provision recorded for any affiliated funds and co-investment vehicles that are consolidated in the Company’s unaudited condensed consolidated financial statements. For the three months ended March 31, 2025 and 2024, the Company recorded its interim income tax provision utilizing the estimated annual effective tax rate.

The income tax effects of temporary differences give rise to significant portions of deferred tax assets and liabilities, which are presented on a net basis. As of March 31, 2025 and December 31, 2024, the Company recorded a net deferred tax liability of $99.1 million and $95.7 million, respectively, within the Condensed Consolidated Statements of Financial Condition.

The Company files its tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by U.S. federal, state, and local tax authorities. Although the outcome of tax audits is always uncertain, the Company does not believe the outcome of any future audit will have a material adverse effect on the Company’s unaudited condensed consolidated financial statements.

Note 10. Lease Liabilities

The Company leases office space in primarily four locations, principally the company’s corporate headquarters. The Company’s operating leases have remaining lease terms of one to six years.

The Company’s expected future minimum annual lease payments are as follows:


2025 (remainder)	$	2,126
2026		2,834
2027		994
2028		441
2029		449
Thereafter		415
Total minimum lease payments	$	7,259
Less: imputed interest		(511	)

Total operating lease liability	$	6,748

The discount rates used to calculate the Company’s initial lease liability ranged from 0.69% - 5.1%, which were the present value of the lease payments and were equal to the treasury bond rates on the dates the respective leases were signed or acquired. The treasury bond rate used was based on the number of years on the lease including any potential extensions included in the agreements. This risk-free rate applied is a permitted practical expedient under ASC 842.

The Company recognized amortization expense related to all their operating leases in the condensed consolidated statements of operations for the three months ending March 31, 2025 and 2024. This expense represents the amortization of the right-of-use asset associated with the operating leases.

Note 11. Commitments and Contingencies

Mutual and proprietary fund expense reimbursement

The Company has voluntarily agreed to certain expense reimbursement agreements in place with Kinetics Mutual Funds Inc. (“Kinetics Funds”) that are renewed annually by the Company at its discretion. Each Kinetics Fund has an agreed upon expense percentage cap (“Cap”) with the Company. When the overall expenses of the Kinetics Funds for the month reach an agreed upon level, any expenses incurred above the Cap are reimbursed by the Company to the Kinetics Funds. In accordance with the private placement memorandums of certain hedge funds the Company manages (the “Funds”), the Company has agreed to reimburse any expenses incurred above a predetermined Cap to the Funds. For the three months ended March 31, 2025 and 2024, the Company reimbursed to the Kinetics Funds $314 and $344, respectively. These reimbursements are included on the condensed consolidated statement of operations as a reduction of revenue.

Contingencies

The Company and the companies in which it holds ownership interests may be involved in various claims and legal actions in the ordinary course of business. Currently there are no material pending claims or legal actions against the Company or the companies in which it holds ownership interests. The Company records the costs associated with legal fees as such services are rendered.

Note 12. Subsequent events

On May 13, 2025, the Company's Board of Directors declared a cash dividend of $0.056 per share, payable on June 16, 2025 to shareholders of record as of the close of business on May 26, 2025.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with the historical consolidated financial statements of HKHC and the related notes included elsewhere in this current report. The historical consolidated financial data discussed below reflect its historical results of operations and financial position. The following discussion and analysis contains forward-looking statements that are subject to known and unknown risks and uncertainties. Actual results and the timing of events may differ significantly from those expressed or implied in such forward-looking statements due to a number of factors, including those included in the section entitled “Risk Factors” contained elsewhere in this current report describing key risks associated with the business, operations and industry of HKHC. Amounts and percentages presented throughout this section may reflect rounding adjustments and consequently totals may not appear to sum. The items discussed below have had significant effects on many items within HKHC’s consolidated financial statements and affect the comparison of the current period’s activity with those of prior periods.

Overview

HKHC is a research driven, fundamentals-oriented asset manager serving institutions, individuals and financial professionals. It provides investment management services through its wholly-owned subsidiary and registered investment adviser, Horizon Kinetics Asset Management LLC. Through this subsidiary, it manages a number of strategies, most of which are focused on publicly-traded equity securities, but also private investments and digital assets. To accommodate different investing preferences, HKHC’s offerings can be accessed in a variety of ways, including through mutual funds, ETFs, a closed end fund, separately managed accounts that can be customized to the unique investment objectives and risk tolerances of individual clients, and, for qualified investors, via private proprietary partnerships typically known as alternative investments. HKHC raises capital for and manages these strategies, and it earns a management fee that varies among products. In certain instances, the fee it earns is tied to the performance of the account. HKHC also produces a number of research reports and compendia that are sold mainly to institutions, as it believes that the discipline required to produce written research encourages thorough qualitative and quantitative analysis. As of March 31, 2025, the Company had regulatory assets under management ("AUM") of $10.8 billion.

HKHC also manages a portfolio of investment securities for its own benefit, which has historically impacted and is expected to impact future results of operations, often significantly so. As of March 31, 2025, we held investment securities (at fair value) of $105.3 million, which represented 5.1% of total assets. In addition, we have devoted capital to a variety of the proprietary alternative investment funds we manage. As of March 31, 2025, HKHC’s investments in these proprietary funds are $254.5 million, however, since some of these proprietary funds are included within these consolidated financial statements this value is not separately presented.

In addition to investment management and research activities, HKHC operates two wholly-owned, limited purpose broker-dealers, KBD Securities LLC and Kinetics Funds Distributor LLC, both of which are only used for the marketing and promotion of its investment products. We pay a portion of the fee it earns to these and other third-party firms who assist it in marketing.

Along with investing on behalf of clients, HKHC also uses its own capital to invest along with its clients in many of its proprietary products and makes direct investments in public and private instruments including digital assets. Certain employees do, from time to time, serve as management or as a member of the board of directors of the companies in which we invest.

Primary Sources of Revenue

Management or advisory fees are our primary source of revenue, most of which are based on a specified percentage of clients’ average assets under management. A majority of our expenses, including most of our compensation expense, vary directly with changes in revenue.

The management fees for separately managed accounts are generally calculated on the basis of a percentage of the value of each client’s assets (assets under management) and are charged using either an average daily balance or monthly or quarterly ending balance, and either in arrears or advance.

The Company also earns management fees in its mutual funds, ETFs, closed-end funds and proprietary partnerships as compensation for internal fund management and advisory services. The management fees for the proprietary funds vary by fund and investment strategy and are typically approximately between 0.25% and 2.00% of the net asset value of the funds’ underlying investments.

The Company is also entitled to receive incentive fees on proprietary partnerships if certain performance returns have been achieved as stipulated in the governing documents of the applicable fund. Incentive fees are generated when certain returns exceed a previously established high water mark. The incentive fees are calculated as a percentage of the gains experienced, typically 20%, based on the agreement with each partner in the respective fund. Incentive fees are not subject to claw back as a result of performance declines in subsequent periods to the most recent measurement date. Incentive fees, if earned, are recognized upon completion of the contractually determined measurement period, which are generally annually, or when a client redeems their interest. Incentive fees are subject to the uncertainty of market volatility, and as a result, the entire amount of the variable consideration related to incentive fees is constrained until the end of each measurement period when the uncertainty has been resolved. Management and incentive fees earned from consolidated investment products are eliminated from revenue upon consolidation, however the economic benefit to the HKHC shareholders’ is retained through lower amounts attributable to the redeemable noncontrolling interests. Unearned incentive fees resulting from the performance of the Company’s proprietary funds for the three months ended March 31, 2025 are approximately $5.4 million. These unearned incentive fees are subject to change based on market prices and generally expected to be resolved during the fourth quarter of 2025 once it is probable that a significant reversal of revenue will not occur.

A small number of clients with certain separately managed accounts may pay incentive fees in addition to or in lieu of management fees, if their portfolio achieves positive investment returns, in certain cases, in excess of an agreed benchmark or hurdle rate. Typically, such fees are paid annually upon crystallization or when a client closes their investment and are not accrued prior to being earned. These unearned performance fees are subject to change based on market prices and generally expected to be resolved during the fourth quarter of 2024 once it is probable that a significant reversal of revenue will not occur.

As a result of our merger transaction in August 2024, the Company also earned revenues of $0.8 million from sales of consumer products during the quarter ended March 31, 2025.

Business Highlights in the first quarter of 2025

Total revenue

•

HKHC’s total revenues continued to grow this quarter as a result of increasing AUM at our proprietary funds, separately managed accounts and mutual funds due to their favorable performance. Total revenues were also positively impacted by a quarter of product sales following the acquisition of Scott’s Liquid Gold in August 2024.

Assets under management

•

AUM for the three months ended March 31, 2025 increased by approximately $1.0 billion, or 10%, to $10.8 billion, due primarily to market value changes of key holdings across the Company’s mutual funds, ETFs and separately managed accounts (SMAs). The market value of Texas Pacific Land Corporation (“TPL”), which is widely held across HKHC’s proprietary funds and SMAs, increased 20% during the quarter resulting in broad increases in AUM. Those increases were partially offset by declines in Grayscale Bitcoin Trust (“GBTC”), which is also widely held across HKHC’s proprietary funds, of 10% during the first quarter. The Company has also experienced net cash inflows into the various products and strategies and has increased its customer accounts during the quarter

Investment performance

•

HKHC maintains a portfolio for investment purposes and has also invested substantial capital in its proprietary funds alongside client investors. For the quarter ended March 31, 2025 there was an increase of $13.7 million in the fair value of this portfolio primarily due to the 20% increase in the TPL securities held directly by HKHC. The increase in the fair value of HKHC’s investments is reported in unrealized gain (loss) on investments, net in the accompanying Consolidated Statement of Operations.

•

The Company’s consolidated investment products experienced favorable performance thus far in 2025. Specifically, the Polestar Funds and Horizon Multi-Strategy Fund were the largest contributors for the three months ended March 31, 2025, however they were partially offset by net losses at Horizon Kinetics Equity Opportunity funds.

Results of Operations for the three months ended March 31, 2025

Revenues

Management and advisory fees

The Company’s total management and advisory fees increased approximately $6.9 million, or 58%, for the three months ended March 31, 2025 compared to the prior year. The increase is primarily the result of higher management fees resulting from our mutual funds due to higher AUM during the quarter.

Other income and fees

Other income and fees during the three months ended March 31, 2025 includes primarily revenue from product sales resulting from the August 2024 acquisition of Scott’s Liquid Gold. Other income and fees also includes revenues resulting from the Company’s research services and digital asset mining activities.

Operating Expenses

Compensation, employee benefits, and cost of goods sold

The Company’s operating expenses include employee compensation for investment professionals and other management personnel as well as cost of goods sold for consumer products acquired in the Merger with SLGD. HKHC’s compensation costs for the three months ended March 31, 2025 increased by approximately $3.2 million, or 51%, compared to the prior year, due to higher internal commissions, additional personnel, and $0.5 million of cost of products sold in the current quarter.

Sales, distribution and marketing expenses

For the three months ended March 31, 2025, sales, distribution and marketing expenses increased $2.3 million, or 104%, compared to the prior quarter, as the result of higher amounts of $0.4 million due to FRMO pursuant to its revenue sharing agreement with HKHC, higher platform fees of $0.8 million, incentive fee commissions and other management fee commissions earned due to generally increasing AUM and management fees during the quarter, and fulfillment costs associated with sales of consumer products.

Depreciation and amortization

Depreciation and amortization increased slightly for the three months ended March 31, 2025 as compared to the prior year due to additional amortization expense of intangible assets from the Merger with SLGD.

General and administrative expenses

For the three months ended March 31, 2025, general and administrative expenses increased by $0.2 million, or 9%, compared to the prior quarter. The Company continued to experience certain higher accounting, professional, and legal fees during the three months March 31, 2025 in preparation and as a result of the Merger with SLGD. The Company also began incurring Director fee costs and included a partial quarter of SLGD’s general and administrative expenses subsequent to the Merger date of $0.1 million.

Equity income, net

Equity earnings, net was $3.1 million for the three months ended March 31, 2025 compared to $0.5 million for the prior year. The increase was due primarily to increases in the fair value of holdings at Horizon Kinetics Hard Assets, LLC as compared to the prior year.

Interest and dividend income

Interest and dividend income increased by $0.3 million for the three months ended March 31, 2025 as compared to the prior year due to higher investable cash balances at the Company.

Unrealized loss on digital assets, net

There was an unrealized loss on digital assets, net of $1.8 million for the three months ended March 31, 2025 as compared to a gain of $4.2 million in the comparable prior year period, primarily due to the change in bitcoin’s value during each respective quarter.

Unrealized gain (loss) on investments, net

For the three months ended March 31, 2025, unrealized gains (losses) on investments increased by $9.1 million compared to the prior year. This increase was due primarily to the $8.9 million unrealized gain on TPL stock during the three months ended March 31, 2025 resulting from its approximately 21% increase in its fair value. The increase in unrealized gains during the third quarter of 2024 was higher than the third quarter of 2023 as a result of the higher investment value at the beginning of the quarter due to the KCI contribution as of July 1, 2024 as well as TPL’s 40% increase during the first six months of 2024.

Income tax benefit (expense)

The Company recognizes deferred income taxes related to the tax basis differences for certain assets, principally unrealized gains in various investments, digital assets and indefinite lived intangible assets from the Company’s 2011 merger transaction. Due to primarily to additional unrealized gains of investment securities and proprietary funds during the quarter, the Company recorded tax expense. During the quarter ended March 31, 2024, the Company was an LLC and was generally not subject to federal or state income taxes as its income and losses are included in the tax returns of its members.

Redeemable Non-Controlling Interests

Net income attributable to redeemable non-controlling interests in Consolidated Investment Products represents the income attributable to ownership interests that third parties hold in entities that are consolidated within our consolidated financial statements. During 2025 the amounts attributable to noncontrolling interests increased correspondingly to the performance of our proprietary funds.

Consolidated Investment Products

Consolidated Investment Products represented a significant portion of our AUM as of March 31, 2025. The activity of the consolidated investment products is reflected within the consolidated financial statement line items indicated by reference thereto. The impact of consolidation will typically decrease management fees and incentive fees, if any, reported under GAAP to the extent these amounts are eliminated upon consolidation. The assets and liabilities of our Consolidated Investment Products are held within separate legal entities and, as a result, the liabilities of our consolidated investment products are typically non-recourse to us. Generally, the consolidation of our consolidated investment products has a significant gross-up effect on our assets, liabilities and cash flows but has no net effect on the net income attributable to us or our stockholders’ equity.

The following table presents the results of operations of the consolidated investment products:


	Three Months Ended March 31,
	2025			2024
Expenses of consolidated investment products	$	(2,999	)	$	(1,823	)
Investment and other income (losses) of consolidated investment products, net		70,267			271,900
Interest and dividend income of consolidated investment products		2,904			3,825
Net income of consolidated investment products		70,172			273,902

Less: Incentive fees allocated to Horizon Kinetics Holding Corporation		(298	)		(646	)
Less: Income attributable to Horizon Kinetics Holding Corporation economic interests		(10,878	)		(30,051	)
Net income attributable to redeemable non-controlling interests in consolidated funds	$	58,996		$	243,205

The results of operations of the consolidated investment products primarily represent activities from certain funds that we are deemed to control. When a fund is consolidated, we reflect the revenues and expenses of the entity on a gross basis, subject to eliminations from consolidation. Substantially all of our results of operations related to the consolidated investment products are attributable to ownership interests that third parties hold in those funds. The consolidated investment products may not necessarily be the same funds in each year presented due to changes in ownership, changes in limited partners’ rights, and the creation or termination of funds and entities. Accordingly, such amounts may not be comparable for the periods presented, and in any event have no material impact on net income attributable to Horizon Kinetics Holding Corporation.

Segment Analysis

For segment reporting purposes, revenues and expenses are presented before giving effect to the results of our consolidated investment products and the results attributable to non-controlling interests that we consolidate. As a result, segment revenues from management fees, incentive fees and investment income are different than those presented on a consolidated basis in accordance with generally accepted accounting principles. Revenues recognized from consolidated investment products are eliminated in consolidation and those attributable to the non-controlling interests of joint ventures have been excluded by us. Furthermore, expenses and the effects of other income (expense) are different than related amounts presented on a consolidated basis in accordance with GAAP due to the exclusion of the results of consolidated investment products and the non-controlling interests.

Liquidity and Capital Resources

At March 31, 2025, the Company had $34.9 million of cash and cash equivalents. We believe that our cash and cash equivalents at March 31, 2025 will be sufficient to fund operations for at least one year from the date of this report.

The Company also had $105.3 million of investments, at fair value. These investments include $76 million held in a single security, approximately 57,696 shares of TPL. During the three months ended March 31, 2025 the fair value of HKHC’s TPL holdings increased due to the capital contribution on July 1 that included shares of TPL and due to the approximately 19.8% year-to-date increase in the fair value of TPL common shares. The Company may be limited in its ability to sell this security due to our status as an affiliate of TPL.

In the normal course of business, we may engage in off-balance sheet arrangements, including transactions in derivatives, guarantees, commitments, indemnifications, and potential contingent repayment obligations. We do not have any off-financial position arrangements that would require us to fund losses or guarantee target returns to clients.

The Company’s Board of Directors has determined an expected quarterly dividend policy that is based on the Company’s quarterly performance. The Board of Director’s may consider other relevant factors that are relevant to the final determination of a quarterly dividend, if any. On May 13, 2025, the Company's Board of Directors declared a cash dividend of $0.056 per share, payable on June 16, 2025 to shareholders of record as of the close of business on May 26, 2025.

The following table and discussion summarize our Condensed Consolidated Statement of Cash Flows:


	Three Months Ended March 31,
	2025			2024			Variance
Net cash used in operating activities	$	(14,480	)	$	(18,915	)	$	4,435
Net cash provided by (used in) investing activities		24,119			(74	)		24,193
Net cash used in financing activities		(3,988	)		(9,752	)		5,764
	$	5,651		$	(28,741	)	$	34,392

Operating cash flows

Net cash provided by operating activities increased by $4.4 million for the three months ended March 31, 2025 compared to the prior year. The increase was primarily the result of earnings, net of working capital changes during the period. The net income (loss) for each of the three month periods were largely offset by non-cash adjustments related to deferred income tax expense related to the Company’s conversion from an LLC to a C-Corp, equity in earnings (losses) of affiliates, and net unrealized gains (losses) on investments or digital assets.

Investing cash flows

Net cash provided by investment activities increased by $24.2 million for the three months ended March 31, 2025 as compared to the prior year as the result of the Company selling certain securities that were received as incentive fee payments related to the 2024 performance. The Company also contributed certain investment securities of $11.5 million to obtain additional equity interests in Horizon Kinetics Hard Assets, LLC (a non-cash investment activity).

Financing cash flows

The Company’s cash flows from financing activities included $2.0 million of dividend payments, as compared to $1.7 million of distributions to members of Horizon Kinetics LLC during the first quarter of 2024. The Company ceased distribution payments subsequent to the closing of the Merger.

Contractual Cash Obligations and Other Commercial Commitments

The Company’s contractual cash obligations and other commercial commitments is limited to certain operating leases for office space as summarized below:


	Payments Due by Period
	Total		2025 (remainder)		2026 and 2027		2028 and 2029		Thereafter
Contractual Cash Obligations:
Operating leases	$	7,259	$	2,126	$	3,828	$	890	$	415
Total contractual obligations	$	7,259	$	2,126	$	3,828	$	890	$	415

Critical Accounting Estimates

The preparation of our consolidated financial statements in accordance with GAAP is based on the selection and application of accounting policies that require us to make significant estimates and assumptions that in certain circumstances affect amounts reported in the audited consolidated financial statements. In preparing these financial statements, our estimates and judgments are based on historical experience, information from third-party valuation professionals and various other assumptions, giving due consideration to materiality. We consider the accounting estimates discussed below to be critical to the understanding of our consolidated financial statements. Actual results could differ from our estimates and assumptions, and any such difference could be material to our consolidated financial statements.

Revenue recognition

Horizon Kinetics recognizes revenues when its obligations related to the services are satisfied and it is probable that a significant reversal of the revenue amount would not occur in future periods. Horizon Kinetics enters into contracts that can include multiple services, which are accounted for separately if they are determined to be distinct. Management’s judgment is required in assessing the probability of significant revenue reversal and in identification of distinct services.

Horizon Kinetics derives a substantial portion of its revenue from investment advisory fees which are recognized as the services are performed over time because the customer is receiving and consuming the benefits as they are provided by Horizon Kinetics. Fees are primarily based on agreed-upon percentages of AUM and recognized for services provided during the period, which are distinct from services provided in other periods. Such fees are affected by changes in AUM, including market appreciation or depreciation and net inflows or outflows. AUM represents the broad range of financial assets Horizon Kinetics manages for clients on a discretionary basis pursuant to investment management and trust agreements that are expected to continue for at least 12 months. In general, reported AUM reflects the valuation methodology that corresponds to the basis used for determining revenue (for example, net asset values).

Horizon Kinetics receives investment advisory fees, including incentive allocations from certain actively managed investment funds and certain SMAs. These incentive fees are dependent upon exceeding investment return thresholds, which may vary by product or account, and could include varying measurement periods.

Incentive fees are generated on certain management contracts when performance hurdles are achieved, such as returns exceed a previously established high water mark. Such incentive fees are recognized when the contractual performance criteria have been met and when it is determined that they are no longer probable of significant reversal. Given the unique nature of each fee arrangement, contracts with customers are evaluated on an individual basis to determine the timing of revenue recognition. Significant judgment is involved in making such determination. Incentive fees typically arise from investment management services that began in prior reporting periods. Consequently, a portion of the fees recognized may be partially related to the services performed in prior periods that meet the recognition criteria in the current period. At each reporting date, the Company considers various factors in estimating incentive fees to be recognized. These factors include but are not limited to whether: (1) the amounts are dependent on the financial markets and, thus, are highly susceptible to factors outside Horizon Kinetics’ influence; (2) the ultimate payments have a large number and a broad range of possible amounts; and (3) the funds or SMAs have the ability to (a) invest or reinvest their sales proceeds or (b) distribute their sales proceeds, and determine the timing of such distributions.

Principles of Consolidation

In addition to its wholly-owned subsidiaries, generally accepted accounting principles in the United States of America (“GAAP”) requires that the assets, liabilities and results of operations of a variable interest entity (“VIE”) be consolidated into the financial statements of the enterprise that has a controlling interest in the VIE. The determination as to whether an entity qualifies as a VIE depends on the facts and circumstances surrounding each entity, and therefore certain of the investment vehicles managed by Horizon Kinetics may qualify as VIEs under the variable interest model, whereas others may qualify as voting interest entities (“VOEs”) under the voting interest model.

Fair Value Measurement

GAAP establishes a hierarchical disclosure framework prioritizing the inputs used in measuring financial instruments at fair value into three levels based on their market observability. Market price observability is affected by a number of factors, including the type of instrument and the characteristics specific to the instrument. Financial instruments with readily available quoted prices from an active market or where fair value can be measured based on actively quoted prices generally have a higher degree of market price observability and a lesser degree of judgment inherent in measuring fair value.

Financial assets and liabilities measured and reported at fair value are classified as follows:

•

Level I—Unadjusted quoted prices in active markets for identical instruments.

•

Level II—Unadjusted quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in inactive markets; and model-derived valuations with directly or indirectly observable significant inputs. Level II inputs include prices in markets with few transactions, non-current prices, prices for which little public information exists or prices that vary substantially over time or among brokered market makers. Other inputs include interest rate, yield curve, volatility, prepayment risk, loss severity, credit risk and default rate.

•

Level III—Valuations that rely on one or more significant unobservable inputs. These inputs reflect the Company’s assessment of the assumptions that market participants would use to value the instrument based on the best information available.

In some instances, an instrument may fall into multiple levels of the fair value hierarchy. In such instances, the instrument’s level within the fair value hierarchy is based on the lowest of the three levels (with Level III being the lowest) that is significant to the fair value measurement. Our assessment of the significance of an input requires judgment and considers factors specific to the instrument. See “Note 5. Fair Value,” within our consolidated financial statements included in this Annual Report on Form 10-K for a summary of our valuation of investments and other financial instruments by fair value hierarchy levels.

Income Taxes

The Company is taxed as corporation for U.S. federal and state income tax purposes. We use the liability method of accounting for deferred income taxes pursuant to GAAP. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the carrying value of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the statutory tax rates expected to be applied in the periods in which those temporary differences are settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized during the year the change is enacted. A valuation allowance is recorded on our net deferred tax assets when it is more likely than not that such assets will not be realized or when timing is unknown. When evaluating the realizability of our deferred tax assets, all evidence, both positive and negative, is evaluated. Items considered in this analysis include the ability to carry back losses, the reversal of temporary differences, tax planning strategies and expectations of future earnings.

Under GAAP, the amount of tax benefit to be recognized is the amount of benefit that is more likely than not to be sustained upon examination. We analyze our tax filing positions in all of the U.S. federal, state, local and foreign tax jurisdictions where we are required to file income tax returns, as well as for all open tax years in these jurisdictions. If, based on this analysis, we determine that uncertainties in tax positions exist, a liability is established. As of December 31, 2024, we have not identified any uncertain tax positions.

Tax laws are complex and subject to different interpretations by the taxpayer and respective governmental taxing authorities. Significant judgment is required in determining tax expense and in evaluating tax positions, including evaluating uncertainties under GAAP.

Recently Issued Accounting Standards

For information on recently issued accounting standards, see Note 3(l), “Recently Issued Accounting Standards,” to our condensed consolidated financial statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of March 31, 2025, we conducted an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of March 31, 2025 due to the material weaknesses in our internal control over financial reporting described below.

Notwithstanding the material weaknesses, which still existed as of March 31, 2025, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that the condensed consolidated financial statements included in this Quarterly Report present fairly, in all material respects, our financial position, results of operations and cash flows as of the dates, and for the periods presented, in conformity with accounting principles generally accepted in the United States.

Material Weaknesses

A material weakness is a deficiency or a combination of deficiencies in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the registrant’s financial statements will not be prevented or detected on a timely basis. The material weakness that was previously reported at Scott’s Liquid Gold was identified as of June 30, 2023 related to our finance department lacking a sufficient number of trained professionals with technical accounting expertise to process and account for complex, non-routine transactions in accordance with GAAP. The material weakness was detailed in Item 4 of the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2023. During 2024, management identified a material weakness with respect to the review and consolidation in the financial statements of certain proprietary funds that represent variable interest entities. In addition, Horizon Kinetics has previously identified material weaknesses related to (a) producing timely account reconciliations and valuations of certain significant accounts, including certain intercompany and related party accounts and related elimination entries, (b) a lack of segregation of duties in certain areas of the financial reporting process, including a lack of adequate supervisory review of technical accounting implementations, lack of IT general controls over certain third-party systems, conclusions over critical accounting estimates, and review of the consolidated financial statements, and (c) insufficient supervisory review and approval of key controls over disbursements and accounts payable. These material weaknesses still existed as of March 31, 2025.

During 2024, the Company hired a Chief Financial Officer and other trained professionals to our finance department, who have technical accounting expertise to process and account for complex, non-routine transactions in accordance with GAAP. The process of remediating these material weaknesses will continue until these staff and others operate for a period of time, our controls are tested, and the Company is able to conclude that such internal controls are operating effectively. The Company cannot provide assurance that these procedures will be successful in identifying material errors that may exist in the financial statements. The Company cannot make assurances that it will not identify additional material weaknesses in its internal control over financial reporting in the future.

Changes in Internal Control over Financial Reporting

During the first quarter, management has implemented certain additional review and account reconciliation controls.

PART II

ITEM 1A. RISK FACTORS

In addition to the other information set forth in this Report, including the “Cautionary Note on Forward-Looking Information,” you should carefully consider the factors discussed in Item 1A, “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

All of the factors referenced above could materially affect our, or the combined company’s, business, financial condition, or future results.

ITEM 6. EXHIBITS


Exhibit Number		Document
31.1		Rule 13a-14(a) Certification of the Chief Executive Officer.
31.2		Rule 13a-14(a) Certification of the Chief Financial Officer.
32.1*		Certification of Murray Stahl pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*		Certification of Mark Herndon pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRLtags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Furnished, not filed.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


			HORIZON KINETICS HOLDING CORPORATION

Date:	May 14, 2025	By:	/s/ Murray Stahl
			Murray Stahl Chief Executive Officer

Date:	May 14, 2025	By:	/s/ Mark A. Herndon
			Mark A. Herndon Chief Financial Officer