Zone Frontier Inc.
For the period ended Jun 30, 2026. Filed Sep 28, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed Sep 28, 2026
ZONE$3.08-14.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2025-06-30; filed 2025-08-22.
0001213900-25-079975
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2026-06-30; filed 2026-09-28.
0001213900-26-104157
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 46 previous paragraphs and 70 current paragraphs.
19 unchanged; 20 reworded; 30 added; 7 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 11 previous and 21 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (30)
Current report
Zone Frontier Inc., formerly CleanCore Solutions, Inc. (“the Company”, “we”, or “Zone”) is helping to build the critical infrastructure that powers the AI economy. We aim to meet the increasing demand for compute capacity, power, and digital infrastructure required by the world’s leading AI companies.
Current report
We specialize in providing powered land and facilities, in conjunction with our development partners, to support over one gigawatt of computer power by 2030. With campuses being developed across rural and industrial Minnesota and Texas, we expect to bring approximately 55 MW of utility power capacity and 40 MW of critical IT load online and revenue generating during the first calendar quarter of 2027.
Current report
On June 8, 2026, the Company announced a new focus on building critical AI infrastructure across the United States, led by newly hired CEO Tyler Hassen, and plans to move away from its cleaning products business and Dogecoin treasury strategy.
Current report
On July 9, 2026, the Company announced its first data center project. Located in West Texas, and with development platform provider HST Technologies, Inc., it is projected to supply an initial 200-megawatts of utility power by 2029, with potential to expand to more than 500-megawatts by 2030.
Current report
On July 20, 2026, substantially all Dogecoin assets were sold. The proceeds will be used to fund the Company’s AI strategy.
Current report
On July 29, 2026, the Company announced its second data center project, its flagship campus located in Minnesota. The site is already powered and under exclusive pre-leased occupancy with Cerebras Systems, a leading AI compute company. It is expected to generate revenue beginning in the first calendar quarter of 2027, offering 55-megawatts of utility power and 40-megawatts of critical load, once fully built out.
Current report
On June 8, 2026, the Company announced plans to sell or dispose substantially all assets of the cleaning products business, including the wholly owned Irish subsidiary, CleanCore Global Inc. The Company is in the process of selling this business unit but is not under binding contract with any party as of September 28, 2026. The segment did not meet the criteria as Held for Sale as of June 30, 2026 and is included in this Report. On August 31, 2026, the Company changed its name from CleanCore Solutions Inc. to Zone Frontier Inc.
Current report
The Treasury segment included dedicated resources assigned to execute on our digital asset strategy, unrealized gain or loss on digital assets, and other third-party costs associated with our digital assets holdings, and income tax effects generated from our Dogecoin holdings to better align with their activities and utilization.
Current report
The AI Critical Infrastructure segment includes costs related to the development of data centers. This segment has not generated any revenue as of June 30, 2026.
Current report
Principal Factors Affecting the Financial Performance of our AI Critical Infrastructure Business, which was announced on June 8, 2026
Current report
The operating results for our AI Critical Infrastructure operations are primarily affected by the following factors:
Current report
Principal Factors Affecting the Financial Performance of our Cleaning Solutions Business
Current report
Principal Factors Affecting the Financial Performance of our Cryptocurrency Treasury Operations, which the Company exited on July 20, 2026 by selling all remaining digital assets
Current report
The operating results for our Treasury operations were primarily affected by the following factors:
Current report
The Company’s chief operating decision maker (“CODM”) is the Company’s Chief Executive Officer, Tyler Hassen, who was appointed on March 16, 2026, who managed the Company as three discrete segments as well as on a consolidated basis, in conjunction with the Company’s General Manager, Clayton Adams, who was the former Chief Executive Officer. The CODM uses net income (loss) to assess the profitability of the CleanCore Segment by comparing actual to budgeted results on a quarterly basis. In doing so, he focused on revenue, gross profit, and operating profit (loss) of the CleanCore Segment. The CODM assessed the Treasury Segment using the value of the Dogecoin and number of tokens held. The CODM assesses the AI Critical segment using actual vs. budgeted expenses and progress towards construction completion. All segments allocate personnel and budget accordingly to maximize potential profitability. The CODM also uses net income (loss) to understand the impact from income taxes and financing costs for general tax and liquidity planning purposes.
Current report
Revenue. All of our revenue is generated by the CleanCore segment, which generates revenue from sales of our cleaning products. Our revenue increased by $1,333,600, or 64.34%, to $3,406,434 for the year ended June 30, 2026 from $2,072,834 for the year ended June 30, 2025. The primary increase is from an increase in revenue from the Ireland location of approximately $817,000 due to a full-year of sales from Ireland.
Current report
*Goodwill impairment.*In connection with the proposed sale of the CleanCore segment, the Company obtained a third party valuation of the business and performed a quantitative impairment test. The test indicated that the fair value of the reporting unit was less than the carrying amount. As a result, the Company fully impaired its goodwill balance as of June 30, 2026.
Current report
Total Other income (expense), net.* *We had $116,182,144 in Total other expense, net, or (3,410.67)% of revenue, for the year ended June 30, 2026, as compared to $355,934 Other expense, net, or 17.17% of revenue, for the year ended June 30, 2025. Total other expense, net, for the year ended June 30, 2026 consisted of a change in fair value of digital assets held of $(116,318,363), interest income, net, of $140,365, and a foreign exchange loss of $4,146, while other expense, net, for the year ended June 30, 2025, consisted entirely of interest expense. The increase in change in fair value of digital assets is driven by the adoption of our digital asset treasury and a decrease in fair value of Dogecoin, and the increase in interest income is driven by cash from pre-funded warrants and issuance of ATM in the bank earning interest.
Current report
On August 29, 2025, we entered into an amended and restated sales agreement, or the Prior Sales Agreement, with Maxim Group LLC and Curvature Securities LLC, or the Prior Sales Agents, pursuant to which we could, from time to time, in transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act of 1933, as amended, issue and sell through or to the Prior Sales Agents up to a maximum aggregate amount of $1,150,000,000 of shares of common stock. During the year ended June 30, 2026, we issued an aggregate of 10,915,474 shares of common stock under the Prior Sales Agreement for gross proceeds of $28,111,924 and net proceeds of approximately $27,270,267. In May 2026, the Prior Sales Agreement was terminated, and the Company entered into a new sales agreement with Cantor Fitzgerald & Co., and Curvature Securities LLC, or the Sales Agents, pursuant to which we may offer and sell shares of common stock from time to time through the Sales Agents, acting as agent for up to $750,000,000 of shares of common stock.
Current report
On September 5, 2025, we completed an offering of pre-funded warrants to purchase an aggregate of 175,000,420 shares of common stock for aggregate gross proceeds of $175,000,420, of which $148,650,530 was paid in cash and $26,349,890 was paid in cryptocurrency. After deducting placement agent fees, reimbursed expenses, and other offering expenses from the total gross proceeds, including both cash and cryptocurrency gross proceeds, we received net proceeds of approximately $164,257,145. Of this amount, approximately $1,075,000 was used to pay off outstanding indebtedness and $4,400,000 was to be used for working capital and general corporate purposes, with the balance of the net proceeds used to acquire Dogecoin. The Company sold its Dogecoin holdings on July 20, 2026 and allocated the cash proceeds to the AI Critical Infrastructure. As of June 30, 2026, none of our cash is classified as restricted.
Current report
Pursuant to the terms of the Asset Management Agreement, we agreed to pay the Asset Manager and 21Shares a monthly fee in arrears computed at an annual rate as follows: (i) 2% in the aggregate on amounts up to and including $1,000,000,000 in Treasury Account value, with 1.75% paid to the Asset Manager and 0.25% paid to 21Shares; (ii) 1.75% in the aggregate on amounts above $1,000,000,000 up to and including $1,500,000,000 in Treasury Account value, with 1.5% paid to the Asset Manager and 0.25% paid to 21Shares; and (iii) 1.5% in the aggregate on amounts above $1,500,000,000 in Treasury Account value, with 1.25% paid to the Asset Manager and 0.25% paid to 21Shares. Such payments may be made, in the sole discretion of the Asset Manager or 21Shares, in shares of common stock, cash, or Dogecoin and shall be pro-rated for partial periods. These agreements were terminated on February 27, 2026.
Current report
On November 17, 2025, we entered into a strategic advisor agreement with Dogecoin Ventures LLC (which, for the avoidance of doubt, is not related to the Asset Manager), pursuant to which we engaged Dogecoin Ventures LLC to provide certain advisory services relating to our digital asset treasury business in exchange for, among other things, a monthly advisory fee of $83,333. This agreement was terminated on February 27, 2026.
Current report
In connection with the proposed sale of the CleanCore segment, we fully impaired our intangible assets during the year ended June 30, 2026. We compared the estimated future undiscounted cash flows of property and equipment noting that the undiscounted future cash flows were greater than the carrying amount. Therefore, we concluded that property and equipment is not impaired for the years ended June 30, 2026 and 2025. See Note 12 for additional details. Subsequent evaluations will be performed annually on June 30, per our policy.
Current report
In connection with the proposed sale of the CleanCore segment, we obtained a third party valuation of the business and performed a quantitative impairment test. The test indicated that the fair value of the reporting unit was less than the carrying amount. As a result, we fully impaired our goodwill balance as of June 30, 2026. Subsequent evaluations will be performed annually on June 30, per our policy.
Current report
Digital Assets
Current report
In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-08,Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets (“ASU 2023-08”). ASU 2023-08 requires in-scope crypto assets (including the Company’s dogecoin holdings) to be measured at fair value in the statement of financial position, with gains and losses from changes in the fair value of such crypto assets recognized in the statement of operations each reporting period. ASU 2023-08 also requires certain interim and annual disclosures for crypto assets within the scope of the standard. The Company adopted this guidance effective September 2025.
Current report
The Company accounts for its digital assets, which were comprised solely of Dogecoin, as indefinite-lived intangible assets in accordance with ASC 350-60 (Intangibles – Goodwill and Other – Crypto Assets). The Company had ownership and control over its digital assets and uses well-known crypto custodians to secure it.
Current report
The Company’s digital assets were initially recorded at cost, with the cost basis determined using the weighted average cost (“WAC”) method. Upon disposal, the cost basis of the digital assets sold is determined using the WAC method.
Current report
Digital assets were measured at fair value at each reporting period. The Company determined the fair value of Dogecoin in accordance with ASC 820 (Fair Value Measurement), based on the period-end quoted (unadjusted) prices in the Company’s principal market. Changes in fair value are recognized at each reporting date within the change in fair value of digital assets line item in the statement of operations. Upon disposal, the net cash received was subtracted from the cost basis of assets sold to determine the change in fair value of digital assets for the disposed assets.
Current report
The vast majority of the Company’s assets were concentrated in its Dogecoin holdings until all Dogecoin tokens were sold on July 20, 2026. Dogecoin is a digital asset, which is a novel asset class that is subject to significant legal, commercial, regulatory and technical uncertainty. Holding Dogecoin did not generate any cash flows and involves custodial fees and other costs. Additionally, the price of Dogecoin has historically experienced significant price volatility, and a significant decrease in the price of Dogecoin adversely affected the Company’s financial condition and results of operations. The Company’s strategy of acquiring and holding Dogecoin also exposed it to counterparty risks with respect to the custody of its Dogecoin, cybersecurity risks, and other risks inherent to holding a digital asset. In particular, the Company was subject to the risk that, if its private keys with respect to its digital assets were lost or destroyed or other similar circumstances or events occur, the Company may have lost some or all of its digital assets, which could materially adversely affect the Company’s financial condition and results of operations.
Removed paragraphs (7)
Previous report
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Previous report
We specialize in the development and production of cleaning products that produce pure aqueous ozone for professional, industrial, or home use. We have a patented nanobubble technology using aqueous ozone that we believe is highly effective in cleaning, sanitizing, and deodorizing surfaces and high-touch areas.
Previous report
We offer products and solutions that are marketed for janitorial and sanitation, ice machine cleaning, laundry, and industrial industries. Our products are used in many types of environments including retail establishments, distribution centers, factories, warehouses, restaurants, schools and universities, airports, healthcare, food service, and commercial buildings such as offices, malls, and stores.
Previous report
Our mission is to become a leader in creating safe, clean spaces that are free from any chemical residue or skin irritants. We are currently expanding our distributor network, improving our production processes, and proving the effectiveness of our products in restaurants, airports, and hotels.
Previous report
Principal Factors Affecting Our Financial Performance
Previous report
Revenue. We generate revenue from sales of our cleaning products. Our revenue increased by $467,861, or 29.15%, to $2,072,834 for the year ended June 30, 2025 from $1,604,973 for the year ended June 30, 2024. The increase is primarily driven by sales to a new customer, KBS, as described above. As of June 30, 2025, we recognized $876,568 in revenue from KBS under an approximately $1.4 million purchase order issued by KBS.
Previous report
Interest expense, net.* *We incurred interest expense, net, of $356,054, or 17.18% of revenue, for the year ended June 30, 2025, as compared to $335,008, or 20.87% of revenue, for the year ended June 30, 2024. The increase is primarily due to an increase in note payables.
Reworded paragraphs (20)
Previous wording
We will remain an emerging growth company until the earliest of (i) the last day of the fiscal year following the fifth anniversary of our initial public offering, (ii) the last day of the first fiscal year in which our total annual gross revenues are $1.235 billion or more, (iii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our class B common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iv) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
Current wording
We will remain an emerging growth company until the earliest of (i) the last day of the fiscal year following the fifth anniversary of our initial public offering, (ii) the last day of the first fiscal year in which our total annual gross revenues are $1.235 billion or more, (iii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iv) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
Previous wording
The following table sets forth key components of our results of operations for the years ended June 30, 2025 and 2024, both in dollars and as a percentage of revenue.
Current wording
The following table sets forth key components of our results of operations for the years ended June 30, 2026 and 2025, both in dollars and as a percentage of our revenue.
Previous wording
Cost of sales. Our cost of sales consists of raw materials, components, labor, demo expenses and warranty reserves. Our cost of sales increased by $277,208, or 34.26%, to $1,086,369 for the year ended June 30, 2025 from $809,161 for the year ended June 30, 2024. As a percentage of revenue, cost of sales increased from 50.42% for the year ended June 30, 2024 to 52.41% for the year ended June 30, 2025. The increase is the result of higher year-over-year revenue and an increase in indirect costs such as demo expense, R&D, and warranty reserve.
Current wording
Cost of sales. Our cost of sales consists of raw materials, components, labor, demo expenses and warranty reserves. Our cost of sales increased by $1,032,118, or 95.01%, to $2,118,487 for the year ended June 30, 2026 from $1,086,369 for the year ended June 30, 2025. As a percentage of revenue, cost of sales increased from 52.41% for the year ended June 30, 2025 to 62.19% for the year ended June 30, 2026. The increase is the result of higher year-over-year revenue, and an increase in indirect sales costs, primarily inventory reserve. Inventory reserve expense increased by approximately $414,000 as the company has shifted some unit production overseas resulting in a one-time increase in the reserve.
Previous wording
Gross profit. As a result of the foregoing, our gross profit increased by $190,653, or 23.96%, to $986,465 for the year ended June 30, 2025 from $795,812 for the year ended June 30, 2024. As a percentage of revenue, gross profit decreased from 49.58% for the year ended June 30, 2024 to 47.59% for the year ended June 30, 2025.
Current wording
Gross profit. As a result of the foregoing, our gross profit increased by $301,482, or 30.56%, to $1,287,947 for the year ended June 30, 2026 from $986,465 for the year ended June 30, 2025. As a percentage of revenue, gross profit decreased from 47.59% for the year ended June 30, 2025 to 37.81% for the year ended June 30, 2026. The decrease is primarily attributed to the increased indirect inventory reserve expense of $414,000.
Previous wording
General and administrative expenses.* *Our general and administrative expenses consist primarily of personnel expenses, including employee salaries and bonuses plus related payroll taxes, stock based compensation expense, professional advisor fees, bad debts, rent expense, insurance and other expenses incurred in connection with general operations. Our general and administrative expenses increased by $4,609,819, or 186.52%, to $7,081,299 for the year ended June 30, 2025 from $2,471,480 for the year ended June 30, 2024. As a percentage of revenue, our general and administrative expenses increased from 153.99% for the year ended June 30, 2024 to 341.62% for the year ended June 30, 2025. This increase was primarily due to increases of $2,532,272 in non-cash stock compensation expense, $351,071 in payroll and benefits related to an increase in headcount, $1,022,152 in professional and consulting fees, $261,250 of intangibles impairment, and $223,376 in director and officer insurance. The increase in professional fees and director and officer insurance is directly related to our listing on NYSE American in April 2024, as fiscal 2025 includes a full year of such fees.
Current wording
General and administrative expenses. In the CleanCore segment, our general and administrative expenses consist primarily of personnel expenses, including employee salaries and bonuses plus related payroll taxes, stock-based compensation expense, professional advisor fees, bad debts, impairment expense, rent expense, insurance and other expenses incurred in connection with general operations. In the Treasury segment, our general and administrative expenses consist primarily of professional advisor fees, stock-based compensation expense, insurance expense, and employee salaries and bonuses plus related payroll taxes. In the AI Critical Infrastructure segment, our costs primary consists of legal fees. Our general and administrative expenses increased by $49,411,629, or 697.78%, to $56,492,928 for the year ended June 30, 2026 from $7,081,299 for the year ended June 30, 2025. As a percentage of revenue, our general and administrative expenses increased from 341.62% for the year ended June 30, 2025 to 1,658.42% for the year ended June 30, 2026. The year-over-year increase is primarily due to a full year of Treasury segment expenses, a full year of Ireland operations, impairment of intangibles, and increased payroll related to the new data-center focus. The most significant increases were $23,252,313 of non-cash professional fees from the Treasury segment, $14,539,737 of Treasury management related expenses, $6,023,783 in non-cash stock option expense and $1,748,969 of intangibles impairment.
Previous wording
Advertising expenses. Our advertising expenses consist of vendor trade shows and various trade publications.* *Our advertising expenses decreased by $23,409, or 20.18%, to $92,598 for the year ended June 30, 2025 from $116,007 for the year ended June 30, 2024. As a percentage of revenue, our advertising expenses decreased from 7.23% for the year ended June 30, 2024 to 4.47% for the year ended June 30, 2025. Such a decrease was primarily due to a decrease in trade shows attended in fiscal 2025.
Current wording
Advertising expenses. In the CleanCore segment, advertising expenses consist of vendor trade shows and various trade publications.* *Our advertising expenses increased by $183,633, or 198.31%, to $276,231 for the year ended June 30, 2026 from $92,598 for the year ended June 30, 2025. As a percentage of revenue, our advertising expenses increased from 4.47% for the year ended June 30, 2025 to 8.11% for the year ended June 30, 2026. Such an increase was primarily due to increased expenses related to crypto marketing, offset by lower marketing expenses for the CleanCore segment.
Previous wording
Depreciation and amortization expense.* *We incurred depreciation and amortization expense of $198,909, or 9.60% of revenue, for the year ended June 30, 2025, as compared to $155,059, or 9.66% of revenue, for the year ended June 30, 2024. The increase is due to amortization expense associated with additional intangibles acquired with the asset acquisition of Sanzonate in April 2025.
Current wording
Depreciation and amortization expense.* * Depreciation and amortization expense, all of which is generated by the CleanCore segment, was $259,598, or 7.62% of revenue, for the year ended June 30, 2026, as compared to $198,909, or 9.60% of revenue, for the year ended June 30, 2025. The increase is due to amortization expense associated with additional intangibles acquired with the asset acquisition of Sanzonate in April 2025.
Previous wording
Net loss.* *As a result of the cumulative effect of the factors described above, we had a net loss of $6,742,275 for the year ended June 30, 2025, as compared to $2,281,742 for the year ended June 30, 2024, an increase of $4,460,533, or 195.49%.
Current wording
Net loss.* *As a result of the cumulative effect of the factors described above, we had a net loss of $174,160,864 for the year ended June 30, 2026, as compared to $6,742,275 for the year ended June 30, 2025, an increase in loss of $167,418,589, or 2,483.12%.
Previous wording
Our company has incurred losses and negative cash flows from operations. From October 17, 2022 (the date of the acquisition) through June 30, 2025, we have financed our operations primarily through private investor funding and an initial public offering. As of June 30, 2025, we had cash and cash equivalents of $1,460,997. For the year ended June 30, 2025, we had a net loss of $6,742,275 and cash used in operating activities of $2,337,659.
Current wording
Our company has incurred losses and negative cash flows from operations. From October 17, 2022 (the date of the acquisition) through June 30, 2026, we have financed our operations primarily through private investor funding. As of June 30, 2026, we had cash and cash equivalents of $15,435,213. For the year ended June 30, 2026, we had a net loss of $174,160,864 and cash used in operating activities of $18,157,390.
Previous wording
Management believes that currently available resources will not be sufficient to fund our planned expenditures over the next 12 months, which raises substantial doubt about our company’s ability to continue as a going concern for 12 months from the balance sheet date as of June 30, 2025.
Current wording
Despite our recent offerings described below, management believes that currently available resources will not be sufficient to fund our planned capital expenditures over the next 12 months. These factors, individually and collectively, indicate that a material uncertainty exists that raises substantial doubt about our company’s ability to continue as a going concern for 12 months from the date of issuance of the accompanying consolidated financial statements.
Previous wording
We will be dependent upon the raising of additional capital through equity and/or debt financing in order to implement our business plan and generate sufficient revenue in excess of costs. If we raise additional capital through the issuance of equity securities or securities convertible into equity, stockholders will experience dilution, and such securities may have rights, preferences or privileges senior to those of the holders of our class B common stock. If we raise additional funds by issuing debt, we may be subject to limitations on its operations, through debt covenants or other restrictions. There is no assurance that we will be successful with future financing ventures, and the inability to secure such financing may have a material adverse effect on our financial condition. The accompanying consolidated financial statements do not include any adjustments to the amounts and classifications of assets and liabilities that might be necessary should we be unable to continue as a going concern.
Current wording
We will be dependent upon the raising of additional capital through equity and/or debt financing in order to implement our business plan and generate sufficient revenue in excess of costs. If we raise additional capital through the issuance of equity securities or securities convertible into equity, stockholders will experience dilution, and such securities may have rights, preferences or privileges senior to those of the holders of our common stock. If we raise additional funds by issuing debt, we may be subject to limitations on its operations, through debt covenants or other restrictions. There is no assurance that we will be successful with future financing ventures, and the inability to secure such financing may have a material adverse effect on our financial condition. The accompanying consolidated financial statements do not include any adjustments to the amounts and classifications of assets and liabilities that might be necessary should we be unable to continue as a going concern.
Previous wording
Net cash used in operating activities was $2,337,659 for the year ended June 30, 2025, as compared to $1,547,880 for the year ended June 30, 2024. For the year ended June 30, 2025, our net loss of $6,742,275, offset by non-cash stock based compensation of $3,203,230, were the primary drivers of net cash used in operating activities. For the year ended June 30, 2024, our net loss of $2,281,741, offset by non-cash stock based compensation of $670,958, were the primary drivers of net cash used in operating activities.
Current wording
Net cash used in operating activities was $18,157,390 for the year ended June 30, 2026, as compared to $2,337,659 for the year ended June 30, 2025. For the year ended June 30, 2026, our net loss of $174,160,864, offset by a change in fair value of digital assets of $116,318,363, non-cash professional fees of $26,482,428, stock-based compensation of $9,227,013, goodwill impairment of $2,237,910 and intangibles impairment of $1,748,969, were the primary drivers of net cash used in operating activities. For the year ended June 30, 2025, our net loss of $6,742,275, offset by non-cash stock-based compensation of $3,203,230, were the primary drivers of net cash used in operating activities.
Previous wording
Net cash used in investing activities was $614,181 for the year ended June 30, 2025, as compared to $10,438 for the year ended June 30, 2024. The net cash used in investing activities for the year ended June 30, 2025 consisted of $581,792 cash used in the acquisition of the assets of Sanzonate and purchases of property and equipment of $32,389, while the net cash used investing activities for the year ended June 30, 2024 consisted entirely of purchases of property and equipment.
Current wording
Net cash used in investing activities was $130,274,845 for the year ended June 30, 2026, as compared to $614,181 for the year ended June 30, 2025. The net cash used in investing activities for the year ended June 30, 2026 consisted of net purchases of digital assets of $148,605,650 and purchases of property and equipment of $37,555, offset by the sale of digital assets of $18,368,360, while the net cash used investing activities for the year ended June 30, 2025 consisted of $581,792 cash used in the acquisition of the assets of Sanzonate and purchases of property and equipment of $32,389.
Previous wording
Net cash provided by financing activities was $2,374,967 for the year ended June 30, 2025, as compared to $3,181,735 for the year ended June 30, 2024. Net cash provided by financing activities for the year ended June 30, 2025 consisted of proceeds from the issuance of promissory notes and warrants of $1,510,000, proceeds from the issuance of original issue discount notes of $500,000, proceeds from the exercise of warrants of $403,171 and proceeds from related party loans of $332,193, offset by payments of notes payable of $316,920 and payments for deferred offering costs of $53,477, while net cash provided by financing activities for the year ended June 30, 2024 consisted of proceeds from the issuance of class B common stock pursuant to the initial public offering of $4,233,875 (net of offering costs) and proceeds from the issuance of convertible notes of $225,000, offset by payments for deferred offering costs of $587,573, repayments of notes of $480,667 and repayments of related party loans of $208,900.
Current wording
Net cash provided by financing activities was $162,383,965 for the year ended June 30, 2026, as compared to $2,374,967 for the year ended June 30, 2025. Net cash provided by financing activities for the year ended June 30, 2026 consisted of proceeds from the private placement described below of $137,907,255, proceeds from the Sales Agreement described below of $27,270,267, and proceeds from the exercise of warrants of $370,288, offset by repayments of notes payable of $660,000, payments for deferred offering costs of $1,078,967, funds provided for a note receivable of $1,000,000 and repayments of related party loans of $425,241, while net cash provided by financing activities for the year ended June 30, 2025 consisted of proceeds from the issuance of promissory notes and warrants of $1,510,000, proceeds from the issuance of original issue discount notes of $500,000, proceeds from the exercise of warrants of $403,171 and proceeds from related party loans of $332,193, offset by payments of notes payable of $316,920 and payments for deferred offering costs of $53,477.
Previous wording
Please see Notes 11 and 12 to the accompanying consolidated financial statements for a description of the terms of our outstanding debt.
Current wording
Please see Notes 14 and 15 to the accompanying consolidated financial statements for a description of the terms of our outstanding debt.
Previous wording
Our principal commitments consist mostly of obligations under the loans described in Notes 11 and 12 to the accompanying consolidated financial statements. We also have a non-cancellable operating lease commitment for our office facility expiring in 2028 as described in Note 16 to the accompanying consolidated financial statements. Other than the foregoing, as of June 30, 2025, we did not have other long-term debt obligations, capital (finance) lease obligations, operating lease obligations, purchase obligations or other long-term liabilities reflected on our statements of financial position.
Current wording
Our other principal commitments consist mostly of obligations under the loans described in Note 20 to our audited consolidated financial statements. We also had a non-cancellable operating lease commitment for our office facility expiring in 2028 as described in Note 20 to the audited consolidated financial statements.
Previous wording
Intangible Assets. Intangible assets primarily consist of existing technology, distribution agreements, licenses, and trademarks obtained as a result of the acquisitions on October 17, 2022 and April 15, 2025. Intangible assets with definite lives are amortized based on their pattern of economic benefit over their estimated useful lives and reviewed periodically for impairment. Our trademarks are deemed to have an indefinite life. The estimated useful life of the acquired technology is 15 years while the estimated useful lives of the distribution agreements and licenses is 5 years.
Current wording
Intangible Assets. Intangible assets primarily consisted of existing technology, customer relationships, and trademarks obtained as a result of the acquisition on October 17, 2022. Intangible assets with definite lives are amortized based on their pattern of economic benefit over their estimated useful lives and reviewed periodically for impairment. Our trademarks are deemed to have an indefinite life. The estimated useful life of the acquired technology is 15 years while the estimated useful life of the customer relationships is 5 years. In connection with the proposed sale of the CleanCore segment, we have fully impaired our intangible assets as of June 30, 2026. See Note 12 for additional details. During the year ended June 30, 2025, as a result of the analysis, we recognized an impairment loss of $261,250 on our customer relationship intangible asset.
Previous wording
Impairment of Long-Lived Assets. Long-lived assets consist primarily of property and equipment and intangible assets. Long-lived assets are tested for impairment when events and circumstances indicate the assets might be impaired by first comparing the estimated future undiscounted cash flows of the asset or asset group to the carrying value. If the carrying value exceeds the estimated future undiscounted cash flows, an impairment loss is recognized based on the amount that the carrying value exceeds the fair value of the asset or asset group. As a result of the analysis, we recognized an impairment loss of $261,250 in general and administrative expenses on our customer relationship intangible asset during the year ended June 30, 2025. No other long-lived assets were determined to be impaired for the years ended June 30, 2025 and 2024. Subsequent evaluations will be performed annually on June 30, per our policy.
Current wording
Impairment of Long-Lived Assets. Long-lived assets consist primarily of property and equipment and intangible assets. Long-lived assets are tested for impairment when events and circumstances indicate the assets might be impaired by first comparing the estimated future undiscounted cash flows of the asset or asset group to the carrying value. If the carrying value exceeds the estimated future undiscounted cash flows, an impairment loss is recognized based on the amount that the carrying value exceeds the fair value of the asset or asset group.
Previous wording
Impairment of Goodwill. We evaluate goodwill for impairment annually, as of June 30, or more frequently when indicators of impairment exist. We consider qualitative factors including market conditions, legal factors, operating performance indicators, and competition, among others, to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount, including goodwill. If we conclude that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, we perform a quantitative impairment test. In performing the quantitative impairment test, we compare the fair value of its reporting unit to the carrying amount including the goodwill of the reporting unit. If the carrying value, including goodwill, exceeds the reporting unit’s fair value, we will recognize an impairment loss for the amount by which the carrying amount exceeds the reporting unit’s fair value. We performed our annual evaluation of goodwill on June 30, 2025. Based on the analysis, we did not recognize an impairment loss during the year ended June 30, 2025. Subsequent evaluations will be performed annually on June 30, per our policy.
Current wording
Impairment of Goodwill. We evaluate goodwill for impairment annually, as of June 30, or more frequently when indicators of impairment exist. We consider qualitative factors including market conditions, legal factors, operating performance indicators, and competition, among others, to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount, including goodwill. If we conclude that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, we perform a quantitative impairment test. In performing the quantitative impairment test, we compare the fair value of its reporting unit to the carrying amount including the goodwill of the reporting unit. If the carrying value, including goodwill, exceeds the reporting unit’s fair value, we will recognize an impairment loss for the amount by which the carrying amount exceeds the reporting unit’s fair value.
Previous wording
Stock-based Compensation. Compensation expense is recognized for all share-based payments to employees and non-employees, including stock options, restricted stock awards, and warrants, in the statements of operation based on the fair value of the awards that are granted. As necessary, our stock price at the date of grant was estimated using an acceptable valuation technique such as the probability-weighted expected return model. The fair value of stock options and warrants are estimated at the date of grant using the Black-Scholes option-pricing model. The fair value of restricted stock awards is based on the fair market value of our class B common stock on the date of grant. Compensation expense for restricted stock awards with performance-based vesting conditions is calculated based on the number of awards that are expected to vest during the performance period if it is probable that the performance metrics will be achieved. Generally, measured compensation cost, net of actual forfeitures, is recognized on a straight-line basis over the vesting period of the related share-based compensation award. We account for forfeitures of stock-based awards as they occur.
Current wording
Stock-based Compensation. Compensation expense is recognized for all share-based payments to employees and non-employees, including stock options, restricted stock awards, and warrants, in the statements of operation based on the fair value of the awards that are granted. As necessary, our stock price at the date of grant was estimated using an acceptable valuation technique such as the probability-weighted expected return model. The fair value of stock options and warrants are estimated at the date of grant using the Black-Scholes option-pricing model. The fair value of restricted stock awards is based on the fair market value of our common stock on the date of grant. Compensation expense for restricted stock awards with performance-based vesting conditions is calculated based on the number of awards that are expected to vest during the performance period if it is probable that the performance metrics will be achieved. Generally, measured compensation cost, net of actual forfeitures, is recognized on a straight-line basis over the vesting period of the related share-based compensation award. We account for forfeitures of stock-based awards as they occur.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Other than the foregoing, at June 30, 2026, we did not have other long-term debt obligations, capital (finance) lease obligations, operating lease obligations, purchase obligations or other long-term liabilities reflected on our statements of financial position.