7. PROPERTY, PLANT, AND EQUIPMENT, NET

Property, plant, and equipment, net was comprised of the following:

For the years ended December 31, 2025 and 2024, depreciation and amortization expenses were $22.7 million and $16.5 million, respectively. Construction in Progress represents assets received but not placed into service as of December 31, 2025 and December 31, 2024. As of December 31, 2025, $27.4 million of Construction in Progress remained unpaid and is included in Other payables and accrued liabilities in the Consolidated Balance Sheet.

During the quarter ended March 31, 2024, we purchased data storage equipment totaling $5,315,202. Almost immediately thereafter, we entered into a sales-type lease agreement effective January 2024 for a portion of these assets valued at $3,353,608 with a third party. As a result, the leased data storage equipment was derecognized from our property, plant, and equipment and recorded as a net investment in lease. Refer to Note 6. Leases for more information.

During the quarter ended September 30, 2024, we purchased data storage equipment totaling $1,254,248 and immediately thereafter, we entered into a sales-type lease agreement effective August 2024 for a portion of these assets valued at $1,184,937 with a third party. As a result, the leased data storage equipment was derecognized from our property and equipment and recorded as a net investment in lease. Refer to Note 6. Leases for more information.

During the quarter ended December 31, 2024, the Company purchased servers and network equipment totaling $6,056,700 and almost immediately thereafter, we entered into two sales-type lease agreements effective November 2024 and December 2024 with a third party. As a result, the leased cloud service equipment was derecognized from our property, plant, and equipment and recorded as a net investment in lease. Refer to Note 6. Leases for more information.

During the quarter ended June 30, 2025, the Company purchased servers and network equipment totaling $4,898,326 and almost immediately thereafter, we entered into two sales-type lease agreements effective May 2025 and June 2025, respectively, with a third party. As a result, the leased cloud service equipment was derecognized from our property, plant, and equipment and recorded as a net investment in lease. Refer to Note 6. Leases for more information.

During the quarter ended September 30, 2025, the Company purchased servers and network equipment totaling $3,041,389 and almost immediately thereafter, we entered into one sales-type lease agreement effective July 2025 with a third party. As a result, the leased cloud service equipment was derecognized from our property, plant, and equipment and recorded as a net investment in lease. Refer to Note 6. Leases for more information.

Disposals of Property, Plant and Equipment

For the year ended December 31, 2025, the Company sold cloud service equipment for a total consideration of $1.2 million. On the date of the transaction, the carrying amount of these switches was $1.5 million. The Company recognized a loss of $372,993 from the sale which was recorded within Net loss from disposal of property, plant and equipment. As of the date of this report, the Company has collected the cash consideration of $1.2 million.

Subsequent to December 31, 2025, the Company entered into an Equipment Purchase Agreement, effective January 31, 2026, for the sale of 126 GPUs for a total purchase price of $26.1 million. The transaction closed in March 2026 and the Company received the proceeds from the sale in full.