Eightco Holdings Inc.

Previous wording

A significant portion of the ATM proceeds were deployed to acquire digital assets and invest in strategic investments. These capital raises materially strengthened our liquidity and expanded our balance sheet.

Current wording

A significant portion of the ATM proceeds were deployed to acquire digital assets and invest in strategic investments. These capital raises materially strengthened our liquidity and expanded our consolidated balance sheet.

Previous wording

Restructuring and severance expenses consist of costs associated with organizational changes, including employee severance, benefits continuation, contract termination costs, and costs associated with facility consolidations or other restructuring activities. These expenses vary depending on management’s strategic initiatives. No restructuring or severance costs were incurred during the periods presented.

Current wording

Restructuring and severance expenses consist of costs associated with organizational changes, including employee severance, benefits continuation, contract termination costs, and costs associated with facility consolidations or other restructuring activities. These expenses vary depending on management’s strategic initiatives.

Previous wording

Cost of revenues was $7,346,704 for the three months ended March 31, 2026, compared to $9,100,728 for the three months ended March 31, 2025, a decrease of $1,754,024, or 19.3%. The decrease correlates to the reduction in volumes described above.

Current wording

Cost of revenues was $1,968,184 for the three months ended June 30, 2026, compared to $6,333,350 for the three months ended June 30, 2025, a decrease of $4,365,166, or 68.9%. The decrease correlates to the reduction in revenue volumes described above.

Previous wording

Gross profit decreased to $215,261 for the three months ended March 31, 2026, compared to gross profit of $813,259 for the three months ended March 31, 2025, a decline of $597,998, or 73.5%. The decrease was primarily driven by the decrease in revenues.

Current wording

Gross profit decreased to $100,246 for the three months ended June 30, 2026, compared to gross profit of $1,245,296 for the three months ended June 30, 2025, a decline of $1,145,050, or 92.0%. Gross margin declined to 4.8% from 16.4% in the prior-year period. The decrease was driven primarily by the reduction in revenues and unfavorable product mix during the transition away from the online retail and liquidation-model operations.

Previous wording

Selling, general and administrative (“SG&A”) expenses were $10,728,546 for the three months ended March 31, 2026, compared to $2,229,425 for the three months ended March 31, 2025, an increase of $8,499,121, or 381.2%.

Current wording

Selling, general and administrative (“SG&A”) expenses were $6,698,406 for the three months ended June 30, 2026, compared to $2,451,832 for the three months ended June 30, 2025, an increase of $4,246,574, or 173.2%.

Previous wording

Net interest expense totaled $(276,718) for the three months ended March 31, 2026, compared to $(1,288,804) for the three months ended March 31, 2025, a decrease of $1,012,086, or 78.5%, reflecting lower average borrowings on the Company’s financing facilities.

Current wording

Net interest expense totaled $(352,582) for the three months ended June 30, 2026, compared to $(1,276,726) for the three months ended June 30, 2025, a decrease of $924,144, or 72.4%, reflecting lower average borrowings on the Company’s financing facilities.

Previous wording

The Company recognized a loss of $(66,501,874) related to fair value changes of its digital asset holdings during the three months ended March 31, 2026. The Company did not hold digital assets during the comparable 2025 period.

Current wording

The Company recognized a gain of $29,324,737 related to fair value changes of its digital asset holdings during the three months ended June 30, 2026, reflecting recovery in the market prices of Worldcoin (WLD) and Ethereum (ETH) during the quarter. The Company did not hold digital assets during the comparable 2025 period.

Previous wording

Change in Fair Value of Digital Assets

Current wording

Change in Fair Value of Short-Term Investments

Previous wording

Other income increased to $279,954 for the three months ended March 31, 2026, from $21,898 in the prior-year period, an increase of $258,056, primarily due to addition of the Reichard Corrugated Note.

Current wording

Other income increased to $521,307 for the three months ended June 30, 2026, from $81,969 in the prior-year period, an increase of $439,338, primarily due to interest earned on the Reichard Corrugated Note and other miscellaneous items.

Previous wording

The Company recognized a gain on extinguishment of liabilities of $870,000 for the three months ended March 31, 2026. The gain on extinguishment of liabilities was related to fulfilling the terms of settlement agreements for past rents and severances. There was no comparable activity in the prior-year period.

Current wording

The Company recognized a gain on extinguishment of liabilities of $870,000 during the six months ended June 30, 2026, related to the fulfillment of settlement agreements for past rents and severances during the first quarter of 2026. There was no comparable activity in the six months ended June 30, 2025.

Previous wording

Income tax expense was $0 for the three months ended March 31, 2026, compared to an income tax benefit of $(28,793) for the three months ended March 31, 2025. The Company continues to maintain a full valuation allowance on its net deferred tax assets.

Current wording

Income tax expense was $0 for the six months ended June 30, 2026, compared to an income tax benefit of $(28,793) for the six months ended June 30, 2025. The Company continues to maintain a full valuation allowance on its net deferred tax assets.

Previous wording

Net loss from continuing operations was $(76,135,904) for the three months ended March 31, 2026, compared to $(2,654,279) for the three months ended March 31, 2025. Net loss from discontinued operations was $0 for the three months ended March 31, 2026, compared to net income from discontinued operations of $105,553 for the three months ended March 31, 2025. Total net loss was $(76,135,904) for the three months ended March 31, 2026, compared to $(2,548,725) for the three months ended March 31, 2025.

Current wording

Net loss from continuing operations was $(58,434,779) for the six months ended June 30, 2026, compared to $(3,823,798) for the six months ended June 30, 2025. Net income from discontinued operations was $0 for the six months ended June 30, 2026, compared to $105,553 for the six months ended June 30, 2025. Total net loss was $(58,434,779) for the six months ended June 30, 2026, compared to $(3,718,245) for the six months ended June 30, 2025.

Previous wording

As of March 31, 2026, the Company had cash and cash equivalents of $7,546,486, compared to $58,501,108 as of December 31, 2025. In addition to cash, the Company held digital assets at fair value of $175,309,890 as of March 31, 2026. Combined cash and digital assets were approximately $182.9 million as of March 31, 2026. Total assets of $340,632,698 at March 31, 2026, and total liabilities of $18,304,512, resulting in total stockholders’ equity of $322,328,186 at March 31, 2026.

Current wording

As of June 30, 2026, the Company had cash and cash equivalents of $11,003,483, compared to $58,501,108 as of December 31, 2025. In addition to cash, the Company held short-term investments of $50,927,699 and digital assets at fair value of $228,011,086 as of June 30, 2026. Total assets were $407,492,768 at June 30, 2026, compared to $250,193,124 at December 31, 2025, and total liabilities were $13,418,142 at June 30, 2026, compared to $17,975,088 at December 31, 2025, resulting in total stockholders’ equity of $394,074,626 at June 30, 2026, compared to $232,218,036 at December 31, 2025.

Previous wording

Outstanding debt as of March 31, 2026 consisted of $8,725,000 under the Company’s lines of credit and $400,000 under lines of credit with related parties, for a total outstanding lines of credit of $9,125,000. Outstanding debt as of December 31, 2025 consisted of $8,150,000 under the Company’s lines of credit and $2,590,000 under lines of credit with related parties, for a total outstanding lines of credit of $10,740,000, as reported in our Annual Report on Form 10-K. The lines of credit bear interest at rates ranging from 12% to 18% and are collateralized by the inventory of the Company.

Current wording

Outstanding debt as of June 30, 2026 consisted of $8,075,000 under the Company’s lines of credit and $400,000 under lines of credit with related parties, for total outstanding lines of credit of $8,475,000. Outstanding debt as of December 31, 2025 consisted of $8,150,000 under the Company’s lines of credit and $2,590,000 under lines of credit with related parties, for total outstanding lines of credit of $10,740,000. The lines of credit bear interest at rates ranging from 12% to 18% and are currently unsecured.

Previous wording

As of March 31, 2026, our liquidity resources consisted of $7.5 million of cash and cash equivalents, $32.5 million of short-term investments (consisting of U.S. government securities and money market funds), and $75.5 million of U.S. dollar-denominated stablecoins, for total near-cash liquidity of approximately $115.6 million. We also held an additional $99.8 million of other digital assets (primarily Worldcoin (WLD) and Ethereum (ETH)), which are subject to market price volatility. We actively manage working capital by converting stablecoins and, when appropriate, other digital assets to U.S. dollars to meet operating needs. During the three months ended March 31, 2026, we used $4.7 million of cash in operating activities, or approximately $1.6 million per month. Substantially all of our reported $76.1 million net loss for the quarter consisted of non-cash items, including a $66.5 million unrealized loss on digital assets and $5.1 million of non-cash share-based compensation. Based on our current operating cash use, we believe our near-cash liquidity is sufficient to fund our operating cash needs for substantially in excess of the next 12 months, before consideration of additional capital that may be raised under our at-the-market equity offering program or monetization of our other digital asset and strategic investment holdings.

Current wording

During the six months ended June 30, 2026, we used $9.7 million of cash in operating activities, or approximately $1.6 million per month. Substantially all of our reported $(57.9) million net loss for the six-month period consisted of non-cash items, including a net $(37.2) million unrealized loss on digital assets, $5.5 million of non-cash share-based compensation, and the $5.2 million impairment charge. Based on our current operating cash use, we believe our near-cash liquidity is sufficient to fund our operating cash needs substantially in excess of the next 12 months, before consideration of additional capital that may be raised under our ATM equity offering program or monetization of our other digital asset and strategic investment holdings.

Previous wording

We raised additional capital during the quarter under our ATM program. Proceeds were used to acquire digital assets and fund working capital needs.

Current wording

During the six months ended June 30, 2026, the Company raised net proceeds of $218.1 million under its ATM program. Proceeds were used to acquire digital assets, fund strategic private company investments, and support working capital needs.

Previous wording

We deploy a substantial portion of ATM proceeds to acquire digital assets. As of March 31, 2026, we held digital assets at fair value of approximately $175.3 million, consisting primarily of Worldcoin (WLD), Ethereum (ETH), and U.S. dollar-denominated stablecoins. These assets are measured at fair value under ASU 2023-08, with changes recognized in net income, and are custodied with institutional-grade providers, including Kraken, Coinbase, and FalconX.

Current wording

We deploy a substantial portion of ATM proceeds to acquire digital assets. As of June 30, 2026, we held digital assets at fair value of approximately $228.0 million, consisting primarily of Worldcoin (WLD), Ethereum (ETH), and U.S. dollar-denominated stablecoins. These assets are measured at fair value under ASU 2023-08, with changes recognized in net income, and are custodied with institutional-grade providers, including Kraken, Coinbase, and FalconX.

Previous wording

We also deploy liquidity into strategic equity investments in frontier technology companies as part of our long-term capital allocation strategy. In March 2026, we invested $92.6 million in indirect beneficial interests in OpenAI preferred stock, which represents approximately 30% of our total treasury position. We also invested approximately $18 million in Beast Industries, the business platform of content creator MrBeast. An additional $7 million capital commitment was callable through May 9, 2026, at which point the call period expired without being exercised. Additionally, in October 2025, we invested approximately $1 million in Series D Preferred Stock of Mythical, Inc., a developer of blockchain-based video game ecosystems.

Current wording

We also deploy liquidity into strategic equity investments in frontier technology companies as part of our long-term capital allocation strategy. In March 2026, we invested $92.6 million in indirect beneficial interests in OpenAI preferred stock. We also invested approximately $18 million in Beast Industries, the business platform of content creator MrBeast. An additional $7 million capital commitment was callable through May 9, 2026, at which point the call period expired without being exercised. Additionally, in October 2025, we invested approximately $1 million in Series D Preferred Stock of Mythical, Inc., a developer of blockchain-based video game ecosystems. As of June 30, 2026, total strategic private company investments were $111.6 million.

Previous wording

During Q1 2026, we recognized net losses of approximately $66.5 million related to changes in the fair value of digital assets, which materially affected reported results and may impact future liquidity planning given price volatility. Although our $115.6 million of near-cash liquidity (consisting of cash, short-term investments, and stablecoins) is not directly subject to WLD or ETH price movements, a sustained decline in the price of WLD or ETH would reduce the realizable value of our remaining $99.8 million of digital asset holdings and would limit the total liquidity available from our digital asset portfolio. We continue to monitor digital asset market conditions and may adjust our treasury strategy as appropriate.

Current wording

During the six months ended June 30, 2026, we recognized a net loss of approximately $(37.2) million related to changes in the fair value of digital assets, consisting of a $(66.5) million loss during the first quarter of 2026 partially offset by a $29.3 million gain during the second quarter of 2026. Such fair value changes materially affect reported results and may impact future liquidity planning given digital asset price volatility. A sustained decline in the price of WLD or ETH would reduce the realizable value of our digital asset holdings and would limit the total liquidity available from our digital asset portfolio. We continue to monitor digital asset market conditions and may adjust our treasury strategy as appropriate.

Previous wording

Cash Flows for the Three Months Ended March 31, 2026 and 2025

Current wording

Cash Flows for the Six Months Ended June 30, 2026 and 2025

Previous wording

Net cash used in operating activities was $(4,691,568) during the three months ended March 31, 2026, which consisted primarily of the net loss of $(76,135,904), offset by noncash items including the change in fair value of digital assets of $66,501,874, share-based compensation of $5,141,071, depreciation and amortization of $5,102, and a gain on disposal of $(5,949). Changes in assets and liabilities used cash of $(197,762), primarily reflecting a decrease in accrued expenses and other current liabilities of $(1,244,749) and an increase in accounts receivable of $(34,254), partially offset by a decrease in prepaid expenses and other current assets of $706,642, a decrease in inventories of $325,798, and an increase in accounts payable of $48,801.

Current wording

Net cash used in operating activities was $(9,697,765) during the six months ended June 30, 2026, which consisted primarily of the net loss of $(58,434,779), offset by non-cash items including the change in fair value of digital assets of $37,177,137, share-based compensation of $5,498,007, the impairment charge of $5,211,824, reserve for bad debts of $1,836,366, depreciation and amortization of $5,061, and a gain on disposal of $(231,501). Changes in operating assets and liabilities used cash of $(759,880), primarily reflecting a decrease in accrued expenses and other current liabilities of $(1,211,595), an increase in accounts receivable of $(1,503,807), and a decrease in accounts payable of $(1,080,351), partially offset by decreases in inventory of $1,920,098 and prepaid expenses and other current assets of $1,115,775.

Previous wording

Net cash provided by operating activities was $999,824 during the three months ended March 31, 2025, which consisted primarily of the net loss of $(2,548,725), offset by noncash items including depreciation and amortization of $612,664 (continuing and discontinued operations) and amortization of debt issuance costs of $250,000. Changes in assets and liabilities provided cash of $2,685,885, primarily reflecting decreases in inventories of $1,852,604 and accounts receivable of $978,029, and an increase in accrued expenses and other current liabilities of $180,856, partially offset by a decrease in accounts payable of $(450,667), an increase in prepaid expenses and other current assets of $254,118, and changes in discontinued operations of $(129,055).

Current wording

Net cash provided by operating activities was $340,614 during the six months ended June 30, 2025, which consisted primarily of the net loss of $(3,718,245), offset by non-cash items including depreciation and amortization of $1,187,373, amortization of debt issuance costs of $500,000, and share-based compensation of $143,201, partially offset by the gain on sale of assets of $(1,231,774). Changes in operating assets and liabilities provided cash of $3,426,059, primarily reflecting decreases in inventory of $2,094,868 and accounts receivable of $504,904 and an increase in accrued expenses and other current liabilities of $574,478.

Previous wording

Net cash used in investing activities was $(209,008,951) during the three months ended March 31, 2026, compared to $(44,647) for the three months ended March 31, 2025. The increase in net cash used in investing activities is largely attributable to purchases of investments of $(336,039,104) and purchases of digital assets of $(65,910,119) in connection with the implementation of the Company’s Digital Asset Treasury strategy, partially offset by proceeds from the sale of investments of $192,902,626 and repayments of principal under loans held-for-investment of $37,646.

Current wording

Net cash used in investing activities was $(250,506,400) during the six months ended June 30, 2026, compared to net cash provided by investing activities of $397,759 for the six months ended June 30, 2025. The change is largely attributable to purchases of short-term investments of $(363,627,127), purchases of other investments of $(111,599,951), and purchases of digital assets of $(89,286,578) in connection with the implementation and continued execution of the Company’s Digital Asset Treasury strategy, partially offset by proceeds from the sale of short-term investments of $312,930,999 and repayments of principal under loans held-for-investment of $76,258.

Previous wording

Net cash provided by financing activities was $162,745,897 during the three months ended March 31, 2026, compared to net cash used in financing activities of $(759,937) for the three months ended March 31, 2025. The change was largely attributable to net proceeds from the issuance of common stock of $165,360,897 generated through the Company’s ATM program, partially offset by a $1,000,000 prepayment under a contract to repurchase and cancel shares of our common stock in a future period and net repayments under the line of credit of $1,615,000. Net proceeds from the issuance of common stock reflect gross ATM proceeds of $167.6 million, reduced by $2.2 million of cash offering costs paid during the quarter and an additional $3.1 million of offering costs incurred during the quarter remained accrued and unpaid as of March 31, 2026 and are reflected as a non-cash item in the supplemental disclosure of cash flow information.

Current wording

Net cash provided by financing activities was $212,706,540 during the six months ended June 30, 2026, compared to net cash used in financing activities of $(281,308) for the six months ended June 30, 2025. The change was largely attributable to net proceeds from the issuance of common stock of $215,971,540 generated through the Company’s ATM program, partially offset by net repayments under lines of credit of $(2,265,000) and prepayment for share repurchase option of $(1,000,000).

Previous wording

During the quarter ended March 31, 2026, the Company had an unfunded capital commitment of approximately $7 million to Beast Industries, which was committed for a period of 60 days following the Company’s initial investment. While not a variable interest or structured entity, this commitment represents a contractual obligation that, if called, would have had an impact on liquidity. The applicable period of the commitment expired on May 9, 2026.

Current wording

During the six months ended June 30, 2026, the Company had an unfunded capital commitment of approximately $7 million to Beast Industries, which was committed for a period of 60 days following the Company’s initial investment. While not a variable interest or structured entity, this commitment represented a contractual obligation that, if called, would have had an impact on liquidity. The applicable period of the commitment expired on May 9, 2026 without being exercised.