v3.26.1
Segment Reporting
 6 Months Ended
Jun. 30, 2026
Segment Reporting [Abstract]  
SEGMENT REPORTING

20. 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 $19.4 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.

 

All revenue and cost of revenue from intersegment transactions have been eliminated in the condensed consolidated statements of operations and comprehensive (loss) income.

 

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

 

Three Months Ended June 30, 2026

 

    Digital asset
mining		     Cloud
services		     Colocation
services		     ETH
staking		     Total  
Revenue from external customers   $ 2,371     $ 23,806     $ 4,726     $ 903     $ 31,806  
Intersegment revenue     -       -       26       -       26  
Segment revenue     2,371       23,806       4,752       903       31,832  
                                         
Reconciliation of revenue                                        
Other revenue (a)                     307               307  
Elimination of intersegment revenue                                     (26 )
Total consolidated revenue                                     32,113  
                                         
Less:                                        
Electricity costs     1,140       739       758       -       2,637  
Profit sharing fees     422       -       -       -       422  
Datacenter lease expense     -       1,578       70       -       1,648  
GPU lease expense     -       5,601       -       -       5,601  
Wage expense     -       -       253       -       253  
Service costs - ETH staking     -       -       -       42       42  
Third-party customer support fees     -       1,250       -       -       1,250  
Other segment items (b)     199       795       665       -       1,659  
Intersegment cost of revenue     -       26       -       -       26  
Segment cost of revenue     1,761       9,989       1,746       42       13,538  
                                         
Reconciliation of cost of revenue                                        
Elimination of intersegment cost of revenue                                     (26 )
Total consolidated cost of revenue                                     13,512  
                                         
Segment gross profit   $ 610     $ 13,817     $ 3,006     $ 861     $ 18,294  

 

(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 June 30, 2025

 

    Digital asset
mining		     Cloud
services		     Colocation
services		     ETH
staking		     Total  
Revenue from external customers   $ 6,632     $ 16,595     $ 1,729     $ 365     $ 25,321  
                                         
Reconciliation of revenue                                        
Other revenue (a)                     338               338  
Total consolidated revenue                                     25,659  
                                         
Less:                                        
Electricity costs     4,334       602       270       -       5,206  
Profit sharing fees     1,052       -       -       -       1,052  
Datacenter lease expense     -       1,366       156       -       1,522  
GPU lease expense     -       3,749       -       -       3,749  
Wage expense     -       -       170       -       170  
Service costs - ETH staking     -       -       -       30       30  
Other segment items (b)     690       674       92       -       1,456  
Segment cost of revenue     6,076       6,391       688       30       13,185  
                                         
Segment gross profit   $ 556     $ 10,204     $ 1,041     $ 335     $ 12,136  

 

(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.

 

Six Months Ended June 30, 2026

 

    Digital asset
mining		     Cloud
services		     Colocation
services		     ETH
staking		     Total  
Revenue from external customers   $ 6,076     $ 40,573     $ 9,500     $ 3,200     $ 59,349  
Intersegment revenue     -       -       35       -       35  
Segment revenue     6,076       40,573       9,535       3,200       59,384  
                                         
Reconciliation of revenue                                        
Other revenue (a)                     690               690  
Elimination of intersegment revenue                                     (35 )
Total consolidated revenue                                     60,039  
                                         
Less:                                        
Electricity costs     3,345       1,644       1,589       -       6,578  
Profit sharing fees     1,039       -       -       -       1,039  
Datacenter lease expense     -       2,974       537       -       3,511  
GPU lease expense     -       9,316       -       -       9,316  
Wage expense     -       -       458       -       458  
Service costs - ETH staking     -       -       -       163       163  
Third-party customer support fees     -       1,398       -       -       1,398  
Other segment items (b)     628       1,410       1,115       -       3,153  
Intersegment cost of revenue     -       35               -       35  
Segment cost of revenue     5,012       16,777       3,699       163       25,651  
                                         
Reconciliation of cost of revenue                                        
Elimination of intersegment cost of revenue                                     (35 )
Total consolidated cost of revenue                                     25,616  
                                         
Segment gross profit   $ 1,064     $ 23,796     $ 5,836     $ 3,037     $ 33,733  

 

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

 

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

 

Six Months Ended June 30, 2025

 

    Digital asset
mining		     Cloud
services		     Colocation
services		     ETH
staking		     Total  
Revenue from external customers   $ 14,409     $ 31,438     $ 3,367     $ 926     $ 50,140  
                                         
Reconciliation of revenue                                        
Other revenue (a)                     618               618  
Total consolidated revenue                                     50,758  
                                         
Less:                                        
Electricity costs     8,567       1,172       493       -       10,232  
Profit sharing fees     2,242       -       -       -       2,242  
Datacenter lease expense     -       2,640       307       -       2,947  
GPU lease expense     -       7,497       -       -       7,497  
Wage expense     -       -       170       -       170  
Service costs - ETH staking     -       -       -       62       62  
Other segment items (b)     1,390       1,170       230       -       2,790  
Segment cost of revenue     12,199       12,479       1,200       62       25,940  
                                         
Segment gross profit   $ 2,210     $ 18,959     $ 2,167     $ 864     $ 24,200  

 

(a) Other revenue is primarily attributable to Equipment Leasing 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
June 30,		     For the Six
Months Ended
June 30,		  
    2026     2025     2026     2025  
                         
Segment gross profit   $ 18,294     $ 12,136     $ 33,733     $ 24,200  
                                 
Reconciling Items:                                
Other profit (a)     307       338       690       618  
Depreciation and amortization expenses     (10,088 )     (8,224 )     (20,124 )     (15,466 )
Impairment of capitalized software assets     (5,006 )     -       (5,006 )     -  
General and administrative expenses     (22,568 )     (19,667 )     (50,195 )     (27,937 )
(Losses) gains on digital assets     (28,841 )     27,155       (149,911 )     (22,051 )
Gains on digital intangible assets     11,324       -       11,324       -  
Impairment of digital intangible assets     (46,035 )     -       (46,035 )     -  
Net gain (loss) from disposal of property and equipment     -       -       1,822       (334 )
Other (expense) income, net     (8,484 )     4,727       (21,417 )     395  
Change in fair value of derivative liability     (13,967 )     -       (4,715 )     -  
Interest expense     (8,062 )     -       (13,147 )     -  
Net (loss) income before taxes     (113,126 )     16,465       (262,981 )     (40,575 )

 

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