Sphere 3D Corp.
For the period ended Jun 30, 2026. Filed Aug 14, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 14, 2026
DRK$1.57+0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-15.
0001591956-26-000011
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-14.
0001591956-26-000021
Item 2. 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 48 previous paragraphs and 78 current paragraphs.
22 unchanged; 20 reworded; 31 added; 5 removed; 1 previous and 5 current paragraphs rearranged.
Tables are not compared: 1 previous and 1 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 (31)
Current report
We are a digital infrastructure company that owns, operates and is expanding scalable power and data center assets for high-performance computing, artificial intelligence (“AI”) workloads, and digital asset infrastructure. We commenced operations of our Bitcoin mining business in January 2022. Following our business combination with Cathedra Bitcoin Inc. completed on June 1, 2026, we own and operate the power and data center infrastructure underlying a substantial portion of our fleet, rather than relying on third-party hosting providers. We generate revenue from both proprietary Bitcoin mining operations and effective June 1, 2026, from hosting services provided to third parties under hosting agreements and are evaluating, on a site-by-site basis, the suitability of our sites for high-performance computing (“HPC”) and AI infrastructure workloads.
Current report
We have approximately 53 megawatts (“MW”) of operating power capacity across five data centers located in Iowa, Kentucky and Tennessee. Vertically integrating with self-owned and self-operated facilities allows us to reduce our reliance on third-parties and decrease our overall cost to mine a Bitcoin. We also have a development pipeline exceeding 100 MW of potential expansion opportunities. In addition to our proprietary mining operations, we provide hosting services to third parties, including a 30 MW co-mining arrangement with Bitdeer across three sites in Tennessee and Kentucky, which we expect to provide more predictable revenue to complement the variability of our proprietary mining results. We are actively assessing the highest-value applications for our power capacity, including digital asset mining, hosting, and HPC and AI infrastructure workloads
Current report
Our longer-term objective is expanding access to power and data center capacity to support our transition to AI and HPC infrastructure. We believe our existing, energized power positions primarily across the Tennessee Valley Authority region offer a faster and more capital disciplined path to deployment than sites still awaiting interconnection or lengthy construction schedules, and we are pursuing a modular development approach intended to convert smaller sites more quickly than large campus projects. We intend to differentiate our platform through execution, site readiness and proactive community engagement, while continuing to grow the scale of our power and data center portfolio.
Current report
On June 25, 2026, our Board of Directors unanimously approved, and recommended that our shareholders approve, a proposed change of our name to DarkHorse Technologies Inc., and we have reserved the ticker symbol “DRK” with Nasdaq for use upon shareholder approval and effectiveness of the name change. The proposed name change will be submitted to shareholders for a vote at a special meeting scheduled for August 24, 2026, and remains subject to shareholder approval.
Current report
Recent Developments
Current report
As previously announced, on March 5, 2026, we entered into a definitive agreement with Cathedra Bitcoin Inc. (“Cathedra”), a company that builds, develops and operates power infrastructure facilities for use in high-density computing, to combine in an all-stock transaction. On June 1, 2026, the business combination was effected by way of a plan of arrangement under the Business Corporations Act (British Columbia), pursuant to which S3D Acquisition Corp., our wholly-owned subsidiary, acquired all of the issued and outstanding shares of Cathedra in a share-for-share transaction, and Cathedra became a wholly-owned subsidiary of the Company (the “Combination”). For purchase consideration, we issued 2,405,300 common shares and 1,387,117 preferred shares of the Company with an aggregate fair value of $7.3 million. Immediately following the closing, former Cathedra security holders held approximately 33% of the voting rights in the combined company, compared with approximately 67% held by Sphere’s pre-existing shareholders.
Current report
Co-Mining Agreement
Current report
On May 28, 2026, an agreement was entered into with Bitdeer Technologies (“Bitdeer”) to host 30 megawatts of capacity at three of our data center sites in Tennessee and Kentucky. These agreements offer contracted mining economics while we assess broader digital infrastructure opportunities, including AI applications. Bitdeer will deploy its SEALMINER A2 Pro Air mining hardware at these sites, with net mining proceeds shared between us and Bitdeer. Each agreement has an initial term of 12 months, renewable for an additional 12 months unless either party elects otherwise, allowing flexibility as we explore optimal uses of our power-backed infrastructure. Subsequent to June 30, 2026, we installed the first of three sites with the remaining two expected to be fully installed before November 2026.
Current report
We generated revenues of $2.5 million and $3.0 million, respectively, during the second quarter of 2026 and 2025. The decrease in revenue of $0.5 million is primarily due to a decline in the fair value of Bitcoin; offset by revenue of $0.4 million beginning June 1, 2026 from our acquisition. We expect to expand our revenue mix and utilization going into the second half of 2026. During the second quarter of 2026 and 2025, we mined 29.0 and 30.9 Bitcoin, respectively, representing a 6.1% decrease.
Current report
Direct cost of revenue totaled $2.3 million in both the second quarter of 2026 and 2025. The 2026 amount includes $0.8 million of costs attributable to revenue from the acquisition completed on June 1, 2026.
Current report
General and administrative expenses were $4.8 million and $2.1 million for the second quarter of 2026 and 2025, respectively. The $2.7 million increase was primarily due to a $1.8 million increase in costs related to our acquisition completed during the second quarter, a $0.6 million increase in share-based compensation, a $0.2 million increase in investor relations, and a $0.1 million increase in legal fees.
Current report
Depreciation and amortization expense was $1.3 million and $1.7 million for the second quarter of 2026 and 2025, respectively.
Current report
Impairment of property and equipment was $7.0 million and nil for the second quarter of 2026 and 2025, respectively. For the second quarter of 2026, an impairment of $7.0 million was recorded for the estimated market value of mining equipment primarily due to the change in market conditions and decline in Bitcoin prices.
Current report
Impairment of intangible assets was $0.6 million and nil for the second quarter of 2026 and 2025, respectively. For the second quarter of 2026, the Company recorded an impairment charge of $0.6 million to supplier agreements related to the decline in Bitcoin prices.
Current report
Investment Gain
Current report
Revenue
Current report
Operating Expenses
Current report
General and Administrative Expense
Current report
Depreciation and Amortization Expense
Current report
Depreciation and amortization expense was $2.5 million and $3.3 million for the first six months of 2026 and 2025, respectively. The decrease of $0.8 million was primarily due to less depreciation related to our Bitcoin mining machines due to the disposal of machines.
Current report
Impairment of property and equipment was $7.0 million and nil for the first six months of 2026 and 2025, respectively. For the first six months of 2026, an impairment of $7.0 million was recorded for the estimated market value of mining equipment primarily due to the change in market conditions and decline in Bitcoin prices.
Current report
Impairment of intangible assets was $0.6 million and nil for the first six months of 2026 and 2025, respectively. For the first six months of 2026, the Company recorded an impairment charge of $0.6 million to supplier agreements related to the decline in Bitcoin prices.
Current report
Change in fair value of Bitcoin was a loss of $0.8 million and a gain of $0.3 million for the first six months of 2026 and 2025, respectively. The loss in the first six months of 2026 and the gain in the first six months of 2025 was from the change in fair value of Bitcoin held, as well as the gains and losses from when Bitcoin was sold.
Current report
Non-Operating Income and Expenses
Current report
Investment Gain
Current report
On July 31, 2026, we entered into an Amended and Restated Sales Agreement (the “Amended ATM Agreement”) with A.G.P. and Maxim Group LLC (“Maxim” and, together with A.G.P., the “Sales Agents”) for the purpose of amending the ATM Agreement to provide for the addition of Maxim as a sales agent thereunder and to effect conforming changes related thereto. The Amended ATM Agreement otherwise retains all material terms of the original ATM Agreement. The Amended ATM Agreement provides for the sale of common shares having an aggregate offering price of up to $10.3 million (the “Placement Shares”) in transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act of 1933, as amended.
Current report
Contingent Compensation Obligations. The employment agreements for our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) provide for retention bonuses of $1.6 million and $1.1 million, respectively, contingent upon the achievement of specified operational milestones. If the operational milestone is achieved at any time within two years, or by June 1, 2028, the bonus becomes payable in 12 equal monthly installments, in either cash or common shares, at our discretion. In addition, under the CFO’s employment agreement, if certain conditions constituting “good reason” occur prior to January 1, 2027, the CFO’s $1.1 million amount would become payable over an 18‑month period beginning after the operational milestone is achieved.
Current report
On July 31, 2026, the CFO delivered formal notice that the conditions of good reason under his employment agreement had been met in connection with his transition from CEO to CFO following the consummation of the Combination. The notice states that it was provided solely to preserve the CFO’s future rights to receive the $1.1 million payment and that he does not currently intend to resign. To trigger the conditional severance payment, the CFO would be required to formally resign by November 28, 2026, and the operational milestone would also need to be achieved, as specified in his employment agreement.
Current report
No liability has been recorded as of June 30, 2026. However, the potential future payment could represent a material cash commitment depending on the timing of milestone achievement and the form of settlement elected. We will continue to evaluate the likelihood of achieving the milestone and assess any resulting impact on liquidity, capital resources, and future cash flows.
Current report
Power Supply Agreements. We maintain long‑term prepaid electric power supply agreements with regional utilities to support its data‑center operations. Under these agreements, we prepay monthly power charges and maintain cash security deposits. As of June 30, 2026, our aggregate monthly power prepayment is $0.9 million.
Current report
During the first six months of 2026, we received approximately $0.3 million of customer payments in Tether (USDT), which were immediately converted into U.S. dollars. Because the conversion occurred upon receipt and resulted in no gain or loss, the transaction is reflected as a cash inflow from operating activities in our condensed consolidated statements of cash flows. We continue to hold Bitcoin as part of our digital asset strategy; however, we do not hold Tether or other stablecoins, and the receipt and conversion of USDT did not impact our digital asset balances.
Removed paragraphs (5)
Previous report
On March 5, 2026, the Company and Cathedra Bitcoin Inc. (“Cathedra”), entered into a definitive agreement to combine the two companies in an all-stock transaction (the “Arrangement Agreement”). Under the terms of the Arrangement Agreement, the Company has agreed to acquire all of the issued and outstanding shares of Cathedra (the “Transaction”), subject to customary closing conditions, including regulatory, court, and shareholder approvals, such that upon consummation of the Transaction, Cathedra will be a wholly-owned subsidiary of the Company. If the Arrangement Agreement is terminated in certain specified circumstances, the Company or Cathedra would be required to pay the other party a termination fee of $0.5 million. The Arrangement Agreement is currently expected to close in the second quarter of 2026.
Previous report
In January 2022, we commenced operations of our Bitcoin mining business and are dedicated to becoming a leader in the blockchain and cryptocurrency industry. We have established and continue to grow an enterprise-scale mining operation through the procurement of mining equipment and infrastructure, and partnering with experienced service providers.
Previous report
During the three months ended March 31, 2026, we mined 25.3 Bitcoin, which represented a decrease of 17.0% over the 30.5 Bitcoin we mined during the three months ended March 31, 2025. The decrease was primarily due to our transition to lower-cost hosting sites and refreshing our fleet with newer-generation machines. Based on our existing operations and expected deployment of miners we have purchased, we anticipate continuing to increase exahash throughout 2026. We do not have scheduled downtime for our miners. We periodically perform both scheduled and unscheduled maintenance on our miners. Depending on the type of repair, the miner may run at a reduced speed or be taken offline. We use software programs to monitor the performance of our machines. The miners operating as of March 31, 2026 have an average efficiency (joules per terahash – “J/th”) of 17.1 J/th. The miner efficiency is an indication of how efficiently we can earn Bitcoin and minimize cost to run the miner. Currently, we intend only to mine Bitcoin and we hold no other cryptocurrency other than Bitcoin. We do not have any power purchase agreements for the supply of power.
Previous report
Depreciation and amortization expense was $1.1 million and $1.6 million for the first quarter of 2026 and 2025, respectively.
Previous report
Investment Loss
Reworded paragraphs (20)
Previous wording
The following quarterly management’s discussion and analysis (“MD&A”) should be read in conjunction with our unaudited condensed consolidated financial statements and the accompanying notes of Sphere 3D Corp. (the “Company”) for the three months ended March 31, 2026. The condensed consolidated financial statements have been presented in United States (“U.S.”) dollars and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Unless the context otherwise requires, any reference to the “Company,” “Sphere 3D,” “we,” “our,” “us” or similar terms refers to Sphere 3D Corp. and its subsidiaries. Unless otherwise indicated, all references to “$” and “dollars” in this discussion and analysis mean U.S. dollars.
Current wording
The following quarterly management’s discussion and analysis (“MD&A”) should be read in conjunction with our unaudited condensed consolidated financial statements and the accompanying notes of Sphere 3D Corp. (the “Company”) for the three and six months ended June 30, 2026. The condensed consolidated financial statements have been presented in U.S. dollars and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Unless the context otherwise requires, any reference to the “Company,” “Sphere 3D,” “we,” “our,” “us” or similar terms refers to Sphere 3D Corp. and its subsidiaries. Unless otherwise indicated, all references to “$” and “dollars” in this discussion and analysis mean U.S. dollars.
Previous wording
Many factors could cause actual results, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements, including, but not limited to: the inability to maintain compliance with the requirements of the Nasdaq Capital Market (“Nasdaq”) and/or inability to maintain listing with Nasdaq; the impact of competition; the investment in technological innovation; the retention or maintenance of key personnel; the possibility of significant fluctuations in operating results; the ability of Sphere 3D to maintain business relationships; financial, political or economic conditions; financing risks; future acquisitions; volatility in the market price for the common shares of the Company; compliance by Sphere 3D with financial reporting and other requirements as a public company; conflicts of interests; future sales of common shares by Sphere 3D’s directors, officers and other shareholders; dilution and future sales of common shares. For more information on these risks, you should refer to the Company’s filings with the securities regulatory authorities, including the Company’s most recently filed Annual Report on Form 10-K, which is available on SEDAR at www.sedar.com and EDGAR at www.sec.gov. In evaluating such statements, we urge you to specifically consider various factors identified in this report, any of which could cause actual results to differ materially from those indicated by such forward-looking statements. Forward-looking statements speak only as of the date of this report and we undertake no obligation to publicly update any forward-looking statements to reflect new information, events or circumstances after the date of this report. Actual events or results may differ materially from such statements.
Current wording
Many factors could cause actual results, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements, including, but not limited to: the inability to maintain compliance with the requirements of the Nasdaq Capital Market (“Nasdaq”) and/or inability to maintain listing with Nasdaq; the impact of competition; the investment in technological innovation; the retention or maintenance of key personnel; the possibility of significant fluctuations in operating results; the ability of Sphere 3D to maintain business relationships; financial, political or economic conditions; financing risks; future acquisitions; volatility in the market price for the common shares of the Company; compliance by Sphere 3D with financial reporting and other requirements as a public company; conflicts of interests; future sales of common shares by Sphere 3D’s directors, officers and other shareholders; dilution and future sales of common shares. For more information on these risks, you should refer to the Company’s filings with the securities regulatory authorities, including the Company’s most recently filed Annual Report on Form 10-K, which is available on EDGAR at www.sec.gov and SEDAR+ at www.sedarplus.ca. In evaluating such statements, we urge you to specifically consider various factors identified in this report, any of which could cause actual results to differ materially from those indicated by such forward-looking statements. Forward-looking statements speak only as of the date of this report and we undertake no obligation to publicly update any forward-looking statements to reflect new information, events or circumstances after the date of this report. Actual events or results may differ materially from such statements.
Previous wording
We obtain Bitcoin as a result of our mining operations, and when necessary, we sell Bitcoin to support our operations and strategic growth. We mine Bitcoin in states that do not have any material state-specific regulatory restrictions on the mining of Bitcoin. However, it is possible that these states or other states in which we may seek to operate may create laws that would impede Bitcoin mining. We do not currently plan to engage in regular trading of Bitcoin other than sales to convert our Bitcoin into U.S. dollars. Decisions to hold or sell our Bitcoin is currently determined by management by analyzing forecasts and monitoring the market in real time. We have a hybrid treasury strategy to hold Bitcoin when possible and sell to fund working capital requirements.
Current wording
We obtain Bitcoin as a result of our mining operations, and when necessary, we sell Bitcoin to support our operations and strategic growth. We mine Bitcoin in states that do not have any material state-specific regulatory restrictions on the mining of Bitcoin. However, it is possible that these states or other states in which we may seek to operate may create laws that would impede Bitcoin mining. We do not currently plan to engage in regular trading of Bitcoin other than sales to convert our Bitcoin into U.S. dollars. Decisions to hold or sell our Bitcoin are made by management based on real-time market monitoring and forward looking forecasts. Our treasury strategy is to utilize Bitcoin interchangeably with U.S. dollars, and we will sell Bitcoin as needed to fund working capital requirements or potential growth commitments.
Previous wording
As of March 31, 2026, we have a total hashrate capacity of 0.84 exahash per second (“EH/s”). We are strategizing for our future growth and have refreshed a significant portion of our fleet with newer-generation machines to bolster efficiency. In February 2026, we completed the sale of older generation mining equipment not in service for proceeds of $1.2 million, which was applied to the purchase of new mining equipment. As of March 2025, we have a self-owned 8 megawatt facility in Iowa (“Iowa Site”). Vertically integrating with self-owned facilities, such as our Iowa Site, allows us to reduce our reliance on third-parties and decrease our overall cost to mine a Bitcoin. As a result of our recent strategic changes, mining production has decreased as we focused on our long-term goals of (i) transitioning to lower-cost hosting sites, (ii) vertically integrating to own our own sites, and (iii) refreshing our fleet with newer-generation machines.
Current wording
We have refreshed a significant portion of our fleet with newer-generation machines to improve efficiency and reduce our cost to mine. In February 2026, we completed the sale of older generation mining equipment not in service for proceeds of $1.2 million, which was applied to the purchase of new mining equipment. As of June 30, 2026, we held approximately 20.5 Bitcoin. The fair value of our Bitcoin as of June 30, 2026 was approximately $1.2 million on our condensed consolidated balance sheet.
Previous wording
The First Quarter of 2026 Compared with the First Quarter of 2025
Current wording
The Second Quarter of 2026 Compared with the Second Quarter of 2025
Previous wording
Change in fair value of Bitcoin was a loss of $0.6 million and $0.2 million for the first quarter of 2026 and 2025, respectively. The loss was the change in fair value of Bitcoin held, as well as the loss from when Bitcoin was sold.
Current wording
Change in fair value of Bitcoin was a loss of $0.2 million and a gain of $0.5 million for the second quarter of 2026 and 2025, respectively. The gain or loss was the change in fair value of Bitcoin held, as well as the gain or loss from when Bitcoin was sold.
Previous wording
Investment loss was nil and loss of $3.7 million for the first quarter of 2026 and 2025, respectively, and related to unrealized losses on our equity investment in Core Scientific Inc.
Current wording
Investment loss was nil and gain of $4.3 million for the second quarter of 2026 and 2025, respectively, and related to our equity investment in Core Scientific Inc.
Previous wording
During the first quarter of 2026 and 2025, we had revenues of $1.9 million and $2.8 million, respectively. The $0.9 million decrease in revenue is primarily due to the process of removing older mining equipment and replacing it with newer generation machines resulting in fewer machines mining and less Bitcoin mined, and a decrease in the fair value of Bitcoin. The refreshing of our mining equipment is substantially complete as of the end of the first quarter of 2026. During the first quarter of 2026 and 2025, all of our revenue was derived from Bitcoin mining.
Current wording
We generated revenues of $4.4 million and $5.8 million during the first six months of 2026 and 2025, respectively. The decrease in revenue of $1.4 million is primarily due to a decline in the fair value of Bitcoin, and the process of removing older mining equipment and replacing it with newer generation machines resulting in fewer machines mining and less Bitcoin mined. The decrease is offset by revenue of $0.4 million beginning June 1, 2026 from our acquisition. We expect to expand our revenue mix and utilization going into the second half of 2026. During the six months ended June 30, 2026 and 2025, we mined 54.3 and 61.3 Bitcoin, respectively, representing a 11.4% decrease.
Previous wording
During the first quarter of 2026 and 2025, direct cost of revenues were $1.6 million and $2.2 million, respectively. The $0.6 million decrease in cost of revenue was primarily due to lower hosting fees related to older machines taken offline, sold, and replaced with newer generation machines, as well as lower cost of revenue at our Iowa Site.
Current wording
Direct cost of revenue totaled $3.9 million and $4.5 million, respectively, in the first six months of 2026 and 2025. The $0.6 million decrease was primarily driven by lower hosting fees related to older machines taken offline, sold, and replaced with newer generation machines, as well as lower cost of revenue at our Iowa site. The first six months of 2026 included $0.8 million of costs attributable to revenue from the acquisition completed on June 1, 2026.
Previous wording
General and administrative expenses were $2.5 million and $3.2 million for the first quarter of 2026 and 2025, respectively. The $0.7 million decrease was primarily due to a $1.1 million decrease in legal fees related to a resolved litigation, and a $0.1 million decrease in insurance expense. These decreases were offset by a $0.3 million increase in costs related to strategic business growth efforts, and a $0.2 million increase in share-based compensation.
Current wording
General and administrative expenses were $7.3 million and $5.3 million for the first six months of 2026 and 2025, respectively. The increase of $2.0 million was primarily due to an increase of $2.1 million in costs related to our acquisition completed during the second quarter, $0.8 million increase in share-based compensation, and $0.2 million increase in investor relations. These increases were offset by a decrease in legal fees of $0.9 million related to the resolution of the Gryphon Digital Mining, Inc. litigation, and a decrease of $0.2 million in insurance expense.
Previous wording
Loss on disposal of property and equipment was $0.2 million and $0.8 million for the first quarter of 2026 and 2025, respectively, and related to the sale of mining equipment.
Current wording
Loss on disposal of property and equipment was $0.2 million and $0.9 million for the first six months of 2026 and 2025, respectively, and primarily related to the sale of mining equipment.
Previous wording
Our principal sources of liquidity are our existing cash and cash equivalents. We expect to fund our operations going forward with existing cash resources, revenue from our Bitcoin mining operation, and cash that we may raise through future financing transactions. At March 31, 2026, we had cash and cash equivalents of $3.1 million compared to cash and cash equivalents of $3.7 million at December 31, 2025. As of March 31, 2026, we had working capital of $5.0 million, reflecting a decrease of $1.9 million since December 31, 2025.
Current wording
Our principal sources of liquidity are our existing cash and cash equivalents. We expect to fund our operations going forward with existing cash resources, revenue from our operations, and cash that we may raise through future financing transactions. At June 30, 2026, we had cash and cash equivalents of $2.8 million compared to cash and cash equivalents of $3.7 million at December 31, 2025. As of June 30, 2026, we had working capital of $0.2 million, reflecting a decrease of $6.7 million since December 31, 2025.
Previous wording
At-the-Market Offering Program. On January 3, 2025, we entered into a sales agreement (the “ATM Agreement”) with A.G.P./Alliance Global Partners (the “Sales Agent”). In accordance with the terms of the ATM Agreement, we may offer and sell from time to time through or to the Sales Agent, as agent or principal, the Company's common shares having an aggregate offering price of up to $8.0 million (the “Placement Shares”). The ATM Agreement can be terminated by either party by giving two days written notice. We expect that any proceeds received from the facility will be used primarily for working capital and general corporate purposes and in furtherance of our corporate strategy which may include to accelerate efficiency, for the purchase/upgrade of the Company’s mining fleet, and vertical integration of infrastructure.
Current wording
At-the-Market Offering Program. On January 3, 2025, we entered into a sales agreement (the “ATM Agreement”) with A.G.P./Alliance Global Partners (“AGP”), as sales agent. In accordance with the terms of the ATM Agreement, we were able to offer and sell from time to time through or to AGP, as agent or principal, the Company's common shares having an aggregate offering price of up to $8.0 million. For the three and six months ended June 30, 2026, under the ATM Agreement the Company issued 892,582 and 1,148,724 common shares, respectively, for $2.1 million and $2.5 million of net proceeds, respectively. Subsequent to June 30 2026, under the ATM Agreement we issued 911,274 common shares for $1.7 million of net proceeds.
Previous wording
Neither us nor the Sales Agent are obligated to sell any Placement Shares pursuant to the ATM Agreement. Subject to the terms and conditions of the ATM Agreement, the Sales Agent will use commercially reasonable efforts, consistent with its normal trading and sales practices and applicable state and federal law, rules and regulations and the rules of Nasdaq, to sell the Placement Shares from time to time based upon our instructions, including any price, time or size limits or other customary parameters or conditions we may impose. Sales of the Placement Shares, if any, will be made on Nasdaq at market prices by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 of the Securities Act of 1933, as amended. For the three months ended March 31, 2026 and 2025, under the ATM Agreement the Company issued 256,142 and 21,045 common shares, respectively, for $0.4 million and $0.1 million of net proceeds, respectively. Subsequent to March 31, 2026, under the ATM Agreement we issued 389,865 common shares for $0.6 million of net proceeds.
Current wording
Neither we nor the Sales Agents are obligated to sell any Placement Shares pursuant to the Amended ATM Agreement. Subject to the terms and conditions of the Amended ATM Agreement, the Sales Agents will use commercially reasonable efforts, consistent with its normal trading and sales practices and applicable state and federal law, rules and regulations and the rules of Nasdaq, to sell the Placement Shares from time to time based upon our instructions, including any price, time or size limits or other customary parameters or conditions we may impose. Sales of the Placement Shares, if any, will be made on Nasdaq at market prices by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 of the Securities Act of 1933, as amended.
Previous wording
Management has projected that based on our recurring losses, negative cash flows from operating activities, and our hashing rate at March 31, 2026, cash on hand may not be sufficient to allow us to continue operations and there is substantial doubt about our ability to continue as a going concern within 12 months from the date of issuance of our financial statements if we are unable to raise additional funding for operations. We expect our working capital needs to increase in the future as we continue to expand and enhance our operations. Our ability to raise additional funds for working capital through equity or debt financings or other sources may depend on the financial success of our business and successful implementation of our key strategic initiatives, financial, economic and market conditions and other factors, some of which are beyond our control. We require additional capital and if we are unsuccessful in raising that capital at a reasonable cost and at the required times, or at all, we may not be able to continue our business operations in the cryptocurrency mining industry or we may be unable to advance our growth initiatives, either of which could adversely impact our business, financial condition and results of operations. In an effort to mitigate these risks we are taking steps to lower our cost of mining and have refreshed our mining fleet to increase our mining efficiency.
Current wording
Management has projected that based on our recurring losses, negative cash flows from operating activities, and our hashing rate at June 30, 2026, cash on hand may not be sufficient to allow us to continue operations and there is substantial doubt about our ability to continue as a going concern within 12 months from the date of issuance of our financial statements if we are unable to raise additional funding for operations. We expect our working capital needs to increase in the future as we continue to expand and enhance our operations. Our ability to raise additional funds for working capital through equity or debt financings or other sources may depend on the financial success of our business and successful implementation of our key strategic initiatives, financial, economic and market conditions and other factors, some of which are beyond our control. We require additional capital and if we are unsuccessful in raising that capital at a reasonable cost and at the required times, or at all, we may not be able to continue our business operations in the cryptocurrency mining industry or we may be unable to advance our growth initiatives, either of which could adversely impact our business, financial condition and results of operations. To mitigate these risks we are taking steps to reduce our cost of mining, have refreshed our mining fleet to improve our mining efficiency, and expect that recently contracted hosting agreements should further support these efforts.
Previous wording
Significant changes from our current forecasts, including but not limited to: (i) shortfalls from projected mining earning levels; (ii) increases in operating costs; (iii) decreases in the value of cryptocurrency; and (iv) if we do not maintain compliance with the requirements of Nasdaq and/or we do not maintain our listing with Nasdaq it could have a material adverse impact on our ability to access the level of funding necessary to continue operations at current levels. These factors, among others, should they occur may result in our inability to continue as a going concern within 12 months from the date of issuance of our financial statements. The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business and do not include any adjustments that might result from the outcome of this uncertainty.
Current wording
Significant changes from our current forecasts, including but not limited to: (i) shortfalls from projected earnings; (ii) increases in operating costs; (iii) decreases in the value of cryptocurrency; and (iv) if we do not maintain compliance with the requirements of Nasdaq and/or we do not maintain our listing with Nasdaq, it could have a material adverse impact on our ability to access the level of funding necessary to continue operations at current levels. These factors, among others, should they occur may result in our inability to continue as a going concern within 12 months from the date of issuance of our financial statements. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business and do not include any adjustments that might result from the outcome of this uncertainty.
Previous wording
Net cash used in operating activities. The use of cash during the first three months of 2026 was primarily a result of our net loss of $4.1 million, offset by $2.3 million in noncash items, which primarily included depreciation and amortization, share-based compensation expense, loss on disposal of property and equipment, and change in fair value of Bitcoin.
Current wording
Net cash used in operating activities. The use of cash during the first six months of 2026 was primarily a result of our net loss of $17.9 million, offset by $12.6 million in noncash items, which primarily included impairment of property and equipment, depreciation and amortization, share-based compensation expense, change in fair value of Bitcoin, impairment of intangible assets, loss on disposal of property and equipment, and nonemployee share-based compensation performance award expense.
Previous wording
Net cash provided by investing activities. During the first three months of 2026, we received $2.8 million from proceeds from the sale of Bitcoin. During the first three months of 2025, we received $2.1 million of proceeds from the sale of Bitcoin, and $0.2 million of proceeds from the sale of older mining machines, offset by $1.0 million of payments for the purchase of property and equipment consisting of newer generation mining machines.
Current wording
Net cash provided by investing activities. During the first six months of 2026, we received $5.3 million from proceeds from the sale of Bitcoin and acquired $0.5 million of cash in our acquisition of Cathedra. During the first six months of 2025, we received $5.3 million of proceeds from the sale of Bitcoin, $4.8 million from proceeds from the sale of investment in equity securities, and $0.2 million of proceeds from the sale of older mining machines; offset by $1.2 million of payments for the purchase of property and equipment consisting of newer generation mining machines.
Previous wording
Net cash provided by financing activities. For the first three months of 2026 and 2025, we received $0.4 million and $0.1 million of net proceeds from the issuance of common shares through our ATM Agreement.
Current wording
Net cash provided by financing activities. For the first six months of 2026 and 2025, we received $2.5 million and $0.1 million, respectively, of net proceeds from the issuance of common shares through our ATM Agreement.
Previous wording
The discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP. The preparation of our condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. We review our estimates on an ongoing basis. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions. Management has determined that there are no critical accounting estimates that require disclosure. Our significant accounting policies are outlined in Note 2 to the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.
Current wording
The discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP. The preparation of our condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. We review our estimates on an ongoing basis. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions. Management has determined that there are no critical accounting estimates that require disclosure.
Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
The First Six Months of 2026 Compared with the First Six Months of 2025
Current report — wording carried from elsewhere
Cost of Revenue (exclusive of depreciation and amortization expense)
Current report — wording carried from elsewhere
Change in Fair Value of Bitcoin
Current report — wording carried from elsewhere
Investment gain was nil and $0.7 million for the first six months of 2026 and 2025, respectively, and related to gains on our equity investment in Core Scientific Inc.
Current report — wording carried from elsewhere
The Amended ATM Agreement can be terminated by either party by giving two days written notice. We expect that any proceeds received from the facility will be used primarily for working capital and general corporate purposes and in furtherance of our corporate strategy which may include to accelerate efficiency, for the purchase/upgrade of our mining fleet, and vertical integration of infrastructure.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
As of March 31, 2026, we held approximately 26.2 Bitcoin. The fair value of our Bitcoin as of March 31, 2026 was approximately $1.8 million on our consolidated balance sheet.