v3.26.1
Segment Reporting
 3 Months Ended
Mar. 31, 2026
Segment Reporting [Abstract]  
SEGMENT REPORTING

19. SEGMENT REPORTING

 

The Company has four reportable segments digital asset mining, cloud services, colocation services, and ETH Staking. The reportable segments are identified based on the types of service performed.

 

Gross profit (loss) is the segment performance measure the chief operating decision maker (“CODM”) uses to assess the Company’s reportable segments.

 

The digital asset mining segment generates revenue from the bitcoin the Company earns through its mining activities. Cost of revenue consists primarily of direct production costs of mining operations, including electricity, management fee and maintenance cost but excluding depreciation and amortization.  

The cloud services segment generates revenue from providing high performance computing services to support generative AI workstreams. Cost of revenue consists of direct production costs, including electricity costs, data center lease expense, GPU servers lease expense, third-party customer support fees and other relevant costs, but excluding depreciation and amortization.

 

Colocation services generate revenue by providing customers with physical space, power and cooling within the data center facility. Cost of revenue consists of direct production costs related to our HPC data center services, including electricity costs, lease costs, data center employees’ wage expenses and other relevant costs, but excluding depreciation and amortization.

 

The Ethereum staking segment generates revenue from both native staking and liquid staking. Cost of revenue consists of direct cost related to ETH staking business including service fee and reward-sharing fees to the service providers.

 

The CODM analyzes the performance of the segments based on reportable segment revenue and reportable segment cost of revenue. No operating segments have been aggregated to form the reportable segments.

 

Other than the $19.8 million of goodwill from the Enovum acquisition allocated to the colocation services, the Company does not allocate all assets to the reporting segments as these are managed on an entity-wide basis. Therefore, the Company does not separately disclose the total assets of its reportable operating segments.

 

All Other revenue is generated from equipment leases with external customers.

  

The following tables present segment revenue and segment gross profit reviewed by the CODM:

 

Three Months Ended March 31, 2026

 

   Digital asset
mining		   Cloud
services		   Colocation
services		   ETH
staking		   Total 
Revenue from external customers  $3,704,796   $16,766,543   $4,773,550   $2,296,509   $27,541,398 
Intersegment revenue   -    -    8,679    -    8,679 
Segment revenue   3,704,796    16,766,543    4,782,229    2,296,509    27,550,077 
                          
Reconciliation of revenue                         
Other revenue (a)             383,358         383,358 
Elimination of intersegment revenue                       (8,679)
Total consolidated revenue                       27,924,756 
                          
Less:                         
Electricity costs   2,205,139    905,552    831,189    -    3,941,880 
Profit sharing fees   616,905    -    -    -    616,905 
Datacenter lease expense   -    1,395,148    467,177    -    1,862,325 
GPU lease expense   -    3,715,232    -    -    3,715,232 
Wage expense   -    -    204,911    -    204,911 
Service costs - ETH staking   -    -    -    121,334    121,334 
Third-party customer support fees   -    147,753    -    -    147,753 
Other segment items (b)   429,455    615,598    449,506    -    1,494,559 
Intersegment cost of revenue   -    8,679    -    -    8,679 
Segment cost of revenue   3,251,499    6,787,962    1,952,783    121,334    12,113,578 
                          
Reconciliation of cost of revenue                         
Elimination of intersegment cost of revenue                       (8,679)
Total consolidated cost of revenue                       12,104,899 
                          
Segment gross profit  $453,297   $9,978,581   $2,829,446   $2,175,175   $15,436,499 

 

(a)Other revenue is primarily attributable to equipment leasing revenue and is therefore not included in the total for segment gross profit.

 

(b)All amounts included within other segment items are individually insignificant.

Three Months Ended March 31, 2025

 

   Digital asset
mining		   Cloud
services		   Colocation
services		   ETH
staking		   Total 
Revenue from external customers  $7,776,963   $14,842,286   $1,644,663   $560,641   $24,824,553 
                          
Reconciliation of revenue                         
Other revenue (a)                       280,567 
Total consolidated revenue                       25,105,120 
                          
Less:                         
Electricity costs   4,233,082    569,937    223,058    -    5,026,077 
Profit sharing fees   1,190,300    -    -    -    1,190,300 
Datacenter lease expense   -    1,274,054    -    -    1,274,054 
GPU lease expense   -    3,747,386    -    -    3,747,386 
Datacenter rent expense   -    -    150,537    -    150,537 
Service costs - ETH staking   -    -    -    32,568    32,568 
Other segment items (b)   700,507    496,623    172,241    -    1,369,371 
                          
Segment gross profit  $1,653,074   $8,754,286   $1,098,827   $528,073   $12,034,260 

 

(a)Other revenue is primarily attributable to equipment leasing revenue and is therefore not included in the total for segment gross profit.

 

(b)All amounts included within other segment items are individually insignificant.

 

The following table presents the reconciliation of segment gross profit to net (loss) income before taxes:

 

   For the Three Months Ended
March 31,		 
   2026   2025 
         
Segment gross profit  $15,436,499   $12,034,260 
           
Reconciling Items:          
Other profit (a)   383,358    280,567 
Depreciation and amortization expenses   (10,035,581)   (7,241,989)
General and administrative expenses   (27,627,296)   (8,235,923)
Losses on digital assets   (121,070,273)   (49,205,227)
Net gain (loss) from disposal of property, plant and equipment   1,821,729    (333,620)
Other expense, net   (3,681,246)   (4,337,997)
Interest expense   (5,084,978)   - 
Net loss before taxes   (149,857,788)   (57,039,929)

 

(a)Other profit is primarily attributable to equipment leasing and is therefore not included in the total for segment gross profit.