UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended September 30, 2023 o Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ________ to ________. Commission file number 1-12711 AULT ALLIANCE, INC. (Exact name of registrant as specified in its charter) Delaware 94-1721931 (State or other juri ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended June 30, 2023 o Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ________ to ________. Commission file number 1-12711 AULT ALLIANCE, INC. (Exact name of registrant as specified in its charter) Delaware 94-1721931 (State or other jurisdict ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended March 31, 2023 ¨ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ________ to ________. Commission file number 1-12711 AULT ALLIANCE, INC. (Exact name of registrant as specified in its charter) Delaware 94-1721931 (State or other jurisdic ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Title of each class Trading symbol(s) Name of each exchange on which registered Common Stock, $0.001 par value per share AULT NYSE American 13.00% Series D Cumulative Redeemable Perpetual Preferred Stock, par value $0.001 per share AULT PRD NYSE American FORM 10-K x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended December 31, 2022 or o TRANSITION REPORT UNDER SECTION 13 OR 1 ...

Financing Activities - BitNile sold 256.7 million shares of common stock for gross proceeds of $168.0 million as of September 30, 2022, under the 2022 Common ATM Offering[128] - The company sold 14.8 million shares of common stock for gross proceeds of $2.6 million during the 2022 Common ATM Offering[183] - The company sold 8,933 shares of Series D Preferred Stock for gross proceeds of $124,000 during the 2022 Preferred ATM Offering[183] - A credit agreement with Fifth Third Bank provides a secured revolving credit facility of up to $15 million, maturing on October 14, 2025[184] - The company borrowed $18.9 million in term loans with an interest rate of 8.5% per annum, maturing in 18 months, with monthly payments starting at $0.6 million[185] - The company issued 3% Secured Promissory Notes with a principal amount of $8,181,819, maturing on May 18, 2023[186] - The company must maintain a minimum fixed charge coverage of 1.05 to 1 under the credit agreement[184] - As of November 18, 2022, the availability under the credit agreement was approximately $4.0 million[184] - The company used proceeds from the loans to purchase a private aircraft for a total price of $15.8 million[185] - The company believes its current cash and proceeds from the 2022 ATM Offering are sufficient to meet operating and capital requirements for at least the next twelve months[186] Revenue and Financial Performance - Total revenue for the three months ended September 30, 2022, was $49.8 million, an increase of $80.6 million from a loss of $30.8 million in the same period of 2021[140] - Revenue from cryptocurrency mining operations was $3.9 million for the three months ended September 30, 2022, compared to $0.3 million in the same period of 2021, reflecting a 1,324% increase[144] - Revenue from hotel operations was $5.5 million for the three months ended September 30, 2022, compared to $0 in the same period of 2021, following the acquisition of four hotel properties for $71.3 million[145] - GWW segment revenue increased by $1.4 million, or 22%, to $7.8 million for the three months ended September 30, 2022, driven by military market solutions[141] - TurnOnGreen revenues increased by $0.6 million, or 52%, to $1.7 million for the three months ended September 30, 2022, due to increased sales to defense customers[142] - SMC revenues were $17.1 million for the three months ended September 30, 2022, attributed to the acquisition of SMC in June 2022[143] - Total revenue for the nine months ended September 30, 2022, was $99.97 million, a 124% increase from $44.58 million in the same period of 2021[159] - Revenue from cryptocurrency mining reached $11.4 million for the nine months ended September 30, 2022, a significant increase of 1545% from $0.693 million in the same period of 2021[159] - Revenues from the GWW segment increased by 12% to $21.53 million for the nine months ended September 30, 2022, from $19.20 million in the same period of 2021[160] - TurnOnGreen revenues declined by 11% to $3.85 million for the nine months ended September 30, 2022, from $4.31 million in the same period of 2021, due to supply chain challenges[161] - SMC revenues increased by $17.1 million for the nine months ended September 30, 2022, compared to $0 for the same period in 2021, due to the acquisition of SMC in June 2022[162] - BNI's cryptocurrency mining revenues were $11.4 million for the nine months ended September 30, 2022, up from $0.7 million in the prior year, driven by increased mining activities and favorable market conditions[163] - AGREE revenues reached $12.8 million for the nine months ended September 30, 2022, compared to $0 in the same period of 2021, following the acquisition of four hotel properties for $71.3 million[163] - Ault Alliance's revenues from lending and trading activities increased to $32.2 million for the nine months ended September 30, 2022, from $19.6 million in the prior year, attributed to significant realized and unrealized gains[165] Expenses and Losses - Total cost of revenue for the three months ended September 30, 2022, was $28.7 million, compared to $5.3 million in the same period of 2021[138] - Net loss attributable to BitNile Holdings, Inc. for the three months ended September 30, 2022, was $7.3 million, compared to a net loss of $42.9 million in the same period of 2021[138] - Loss from operations for the three months ended September 30, 2022, was $5.3 million, a significant improvement from a loss of $49.9 million in the same period of 2021[138] - Gross margins were 42.4% for the three months ended September 30, 2022, down from 117.1% in the same period of 2021, with adjusted gross margins of 27.6% and 35.8% for 2022 and 2021, respectively[146] - Selling and marketing expenses rose to $7.4 million for the three months ended September 30, 2022, an increase of 273% from $2.0 million in the same period of 2021, primarily due to higher marketing costs[147] - General and administrative expenses increased by 41% to $15.9 million for the three months ended September 30, 2022, compared to $11.3 million in the same period of 2021, largely due to costs from acquired entities[148] - Interest expense surged to $4.0 million for the three months ended September 30, 2022, compared to $0.1 million in the same period of 2021, primarily due to interest on construction loans and secured promissory notes[151] - Gross margins decreased to 48.4% for the nine months ended September 30, 2022, down from 62.6% in the prior year, impacted by lower margins from cryptocurrency mining operations[166] - Research and development expenses rose by $0.3 million to $1.9 million for the nine months ended September 30, 2022, due to product development efforts[167] - Selling and marketing expenses surged to $20.9 million for the nine months ended September 30, 2022, an increase of 341% from $4.7 million in the prior year, primarily due to higher advertising costs[167] - General and administrative expenses doubled to $48.7 million for the nine months ended September 30, 2022, compared to $24.4 million in the prior year, driven by costs from acquisitions and increased operational expenses[168] Investments and Acquisitions - Ault Alliance's stalking horse bid for EYP's assets was based on an enterprise value of approximately $67.7 million, with a purchase price of $62.5 million[129] - BitNile's investment in Alzamend Neuro included a total of $10 million, with $4 million funded in April 2022 upon achieving a milestone[129] - The company increased its ownership of Avalanche International Corp. from less than 20% to approximately 92% by converting $20 million in convertible promissory notes into common stock[129] - Ault Lending made open market purchases of The Singing Machine Company, acquiring over 50% of its common stock for a total purchase price of $7.4 million[129] - BNI's hosting agreement with Compute North involves hosting approximately 6,500 Bitcoin miners for five years, with a deposit of approximately $2 million paid[131] - The company recorded an impairment of $2 million on a deposit related to the hosting of Bitcoin miners due to Compute North's bankruptcy[132] - The company allocates the purchase price of acquired businesses based on estimated fair values, with any excess recorded as goodwill[187]

Financial Performance - Total revenue decreased by $44.8 million, or 72%, to $17.4 million for the three months ended June 30, 2022, from $62.1 million for the same period in 2021 [129]. - Revenue from cryptocurrency mining operations increased to $4.0 million for the three months ended June 30, 2022, compared to $0.3 million for the same period in 2021, representing a 1266% increase [132]. - Revenue from lending and trading activities decreased to $0.9 million for the three months ended June 30, 2022, from $53.3 million for the same period in 2021, a decline of 98% [134]. - Total revenue for the six months ended June 30, 2022, was $50.2 million, a decrease of $25.2 million or 33% compared to $75.4 million for the same period in 2021 [150]. - Revenue from cryptocurrency mining operations increased to $7.5 million, up 1687% from $421,000 in the prior year [151]. - Revenue from lending and trading activities decreased to $18.9 million, down 68% from $58.5 million in the prior year, primarily due to significant unrealized gains in the previous period [156]. Expenses and Losses - Gross margins decreased to 28.8% for the three months ended June 30, 2022, compared to 89.9% for the same period in 2021 [137]. - Research and development expenses increased by $0.2 million to $0.7 million for the three months ended June 30, 2022, from $0.5 million for the same period in 2021 [138]. - Selling and marketing expenses rose to $7.0 million for the three months ended June 30, 2022, compared to $1.5 million for the same period in 2021, an increase of 364% [139]. - General and administrative expenses increased to $19.0 million for the three months ended June 30, 2022, from $8.0 million for the same period in 2021, a rise of 138% [140]. - The company recorded a loss from operations of $23.7 million for the three months ended June 30, 2022, compared to a gain of $45.8 million for the same period in 2021 [141]. - Net loss for the three months ended June 30, 2022 was $25.8 million, compared to net income of $42.2 million for the same period in 2021 [146]. - General and administrative expenses rose to $32.7 million, a 150% increase from $13.1 million in the prior year, mainly due to costs associated with hotel operations and stock compensation [162]. - The company recorded a loss from operations of $22.7 million for the six months ended June 30, 2022, compared to a gain of $47.0 million in the prior year [163]. - Net loss for the six months ended June 30, 2022 was $54.6 million, compared to net income of $44.2 million for the same period in 2021 [169]. Investments and Acquisitions - BitNile sold 239.7 million shares of common stock for gross proceeds of $163.4 million as part of the 2022 Common ATM Offering [119]. - Ault Alliance's stalking horse bid for EYP's assets was based on an enterprise value of approximately $67.7 million, with a purchase price of $62.5 million [119]. - Digital Power Lending made a $4 million investment in Alzamend Neuro, bringing total investment to $10 million, contingent on achieving specific milestones [120]. - BNI acquired the remaining 30% interest in Alliance Cloud Services for $1.8 million, making it a wholly-owned subsidiary [120]. - The company converted $20 million in convertible promissory notes into approximately 51.9 million shares of Avalanche International Corp., increasing ownership to about 92% [120]. - Revenue from hotel operations was $7.3 million for the six months ended June 30, 2022, compared to $0 for the same period in 2021, following the acquisition of four hotel properties for $71.3 million [155]. Cash Flow and Financial Position - Cash and cash equivalents increased to $24.1 million as of June 30, 2022, up from $15.9 million at December 31, 2021 [171]. - Net cash provided by operating activities totaled $15.0 million for the six months ended June 30, 2022, compared to a net cash used of $21.7 million for the same period in 2021 [171]. - Net cash used in investing activities was $82.8 million for the six months ended June 30, 2022, compared to $29.7 million for the same period in 2021 [171]. - Cash provided by financing activities was $75.5 million for the six months ended June 30, 2022, down from $138.1 million for the same period in 2021 [171]. - The company believes current cash on hand and proceeds from the 2022 ATM Offering are sufficient to meet operating and capital requirements for at least the next twelve months [171]. Other Financial Metrics - Other comprehensive loss was $1.5 million for the three months ended June 30, 2022, compared to other comprehensive income of $5.8 million for the same period in 2021 [146]. - Other comprehensive loss was $1.8 million for the six months ended June 30, 2022, an improvement from a loss of $2.9 million for the same period in 2021 [170]. - Realized gain on marketable securities was $0.1 million for the six months ended June 30, 2022, down from $0.4 million for the same period in 2021 [168]. - Loss from investment in unconsolidated entity was $0.9 million for the six months ended June 30, 2022, compared to $3,000 for the same period in 2021 [168]. - Interest expense increased significantly to $31.9 million for the six months ended June 30, 2022, compared to $0.3 million in the prior year, primarily due to the issuance of Senior Notes [166].

Revenue Performance - Total revenue for Q1 2022 was $32.83 million, a significant increase of 147% compared to $13.25 million in Q1 2021[125] - Cryptocurrency mining revenue reached $3.55 million in Q1 2022, up from $130,000 in Q1 2021[125] - Revenue from lending and trading activities surged to $17.92 million in Q1 2022, compared to $5.21 million in Q1 2021[125] - Total revenue increased by $19.6 million, or 148%, to $32.8 million for the three months ended March 31, 2022, compared to $13.2 million for the same period in 2021[126] - Revenue from cryptocurrency mining operations surged to $3.5 million, a 2,629% increase from $0.1 million in the prior year[130] - Revenues from lending and trading activities rose to $17.9 million, up 244% from $5.2 million for the same period in 2021[132] Profitability and Loss - Gross profit for Q1 2022 was $22.33 million, representing a gross margin of approximately 68%[125] - The company reported a net loss of $28.77 million in Q1 2022, compared to a net income of $1.99 million in Q1 2021[125] - The company reported a net loss of $28.8 million for the three months ended March 31, 2022, compared to a net income of $2.0 million in the same period in 2021[146] - Gross margins improved to 68.0% for the three months ended March 31, 2022, compared to 61.4% in the prior year[134] Operating Expenses - Operating expenses increased to $21.30 million in Q1 2022, up from $6.94 million in Q1 2021[125] - Selling and marketing expenses increased by $5.2 million, or 422%, to $6.5 million, primarily due to higher marketing costs at Ault Alliance[136] - General and administrative expenses rose by $8.6 million, or 169%, to $13.7 million, driven by non-cash stock compensation and costs from hotel operations[137] Cash Flow and Investments - Net cash provided by operating activities totaled $25.0 million for the three months ended March 31, 2022, compared to a net cash used of $14.2 million in the prior year[148] - Net cash used in investing activities was $24.4 million, including $35.4 million for capital expenditures related to Bitcoin mining equipment[149] - Cash and cash equivalents increased to $39.4 million as of March 31, 2022, up from $15.9 million at the end of 2021[148] Strategic Acquisitions and Investments - The company fully paid off $66 million in senior secured notes on March 30, 2022[112] - BitNile acquired the remaining 30% interest in Alliance Cloud Services for $1.8 million, making it a wholly-owned subsidiary[119] - Ault Alliance's stalking horse bid for EYP's assets is based on an enterprise value of approximately $67.7 million[114] - The company plans to continue pursuing growth through acquisitions and strategic investments in various sectors, including cryptocurrency and defense[123] Variable Interest Entity (VIE) and Technology Development - AVLP is classified as a Variable Interest Entity (VIE) and is not consolidated due to the company not being the primary beneficiary[154] - As of March 31, 2022, the company's ownership percentage in AVLP was less than 20%[155] - The company advanced a total of $3.6 million to AVLP under existing loan agreements[155] - AVLP has developed a novel cost-effective and environmentally friendly material synthesis technology for textile applications[156] - AVLP's technology includes Multiplex Laser Surface Enhancement, which enhances functionalities such as dyeability, hydrophilicity, and fire retardancy[156] - The new technology significantly reduces the use of water, harmful chemicals, and energy compared to conventional textile treatment methods[156]

Financial Performance - Total revenue for the year ended December 31, 2021, was $52,400,000, a 120% increase from $23,871,000 in 2020[604]. - Revenue from cryptocurrency mining was $3,450,000, while revenue from lending and trading activities surged to $16,854,000, up 6864% from $242,000 in the previous year[604]. - Gross profit for 2021 was $28,542,000, compared to $7,514,000 in 2020[602]. - The company reported a loss from continuing operations of $(23,971,000) for 2021, compared to $(33,388,000) in 2020[602]. - GWW segment revenues increased by $7,368,000, or 40%, to $25,581,000 in 2021, driven by improved liquidity and increased military market solutions[605]. - TOGI revenues slightly declined by $70,000, or 1%, to $5,346,000 in 2021[606]. - The net loss for the year ended December 31, 2021, was $24.2 million compared to a net loss of $32.7 million for the year ended December 31, 2020[627]. Investments and Acquisitions - The company acquired a 617,000 square foot energy-efficient facility for $4.0 million, funded by its working capital[575]. - The company invested $10 million in Alzamend Neuro, Inc., with $6 million funded as of the report date, for a total of 6,666,667 shares at $1.50 per share[576]. - The company executed contracts to purchase 4,000 Bitcoin miners for a gross purchase price of $27.3 million, with 1,000 units received by September 30, 2021[579]. - The company invested approximately $11.5 million for Series A preferred stock of Earnity Inc., acquiring about 19.99% of its common stock[580]. - The company entered into construction loan agreements totaling $68.75 million for the acquisition of four hotel properties, with a purchase price of $69.2 million[583]. - The company purchased 129,363,756 shares of IMHC's common stock for $200,000, resulting in a change in control of IMHC[582]. - The company entered into a Share Exchange Agreement with Giga-tronics Incorporated, which includes the issuance of 2,920,085 shares of GIGA's common stock[584]. - The company acquired a property for $15,500,000, with $1,500,000 previously funded and $14,000,000 paid on the closing date, intended for a high-rise multi-family project development[588]. - The real estate segment acquired four hotel properties for $71.3 million on December 22, 2021[630]. Revenue Streams - Revenues from cryptocurrency mining operations were $3.5 million for the year ended December 31, 2021, compared to nil for the year ended December 31, 2020[607]. - Revenues from lending and trading activities increased to $16.9 million for the year ended December 31, 2021, from $0.2 million for the year ended December 31, 2020[608]. Expenses - Research and development expenses increased by $0.2 million to $2.0 million for the year ended December 31, 2021[612]. - Selling and marketing expenses were $7.8 million for the year ended December 31, 2021, compared to $1.2 million for the year ended December 31, 2020, an increase of 560%[613]. - General and administrative expenses were $36.7 million for the year ended December 31, 2021, compared to $12.5 million for the year ended December 31, 2020, an increase of 193%[614]. Cash Flow and Financing - Cash and cash equivalents and restricted cash increased to $21.2 million as of December 31, 2021, from $18.7 million at December 31, 2020[629]. - Net cash provided by financing activities was $419.9 million for the year ended December 31, 2021, compared to $37.3 million for the year ended December 31, 2020[635]. - The 2021 ATM Offering raised gross proceeds of $200 million through the sale of 52,552,353 shares of common stock[635]. - Secured promissory notes issued on December 30, 2021, had an aggregate principal amount of approximately $66 million, bearing interest at 8% per annum[636]. - The outstanding balance under AGREE Madison Construction Loan Agreements was $55.1 million as of December 31, 2021, with loans due on January 1, 2025[637]. - The initial public offering of ADTC in December 2021 generated gross proceeds of $112.1 million[638]. - As of March 31, 2022, the company had sold 140.7 million shares under the 2022 ATM Offering for gross proceeds of $110.4 million at an average price of $0.78 per share[639]. - The company believes its current cash on hand and proceeds from the 2022 ATM Offering are sufficient to meet operating and capital requirements for at least the next twelve months[640]. Future Plans - The company plans to fund property improvement plans of $13.7 million for the acquired hotel properties[583]. - The company plans to pursue monetization opportunities and maximize stockholder value through various initiatives, including public offerings and sales of subsidiary interests[597]. Technology Investment - The investment in AVLP is based on its novel technology for textile applications, which significantly reduces the use of water, harmful chemicals, and energy compared to conventional methods[646].

Financial Data and Key Metrics Changes - For the nine months ended, the company reported $44 million in revenue, a dramatic increase from the previous year, indicating significant growth [9][12] - Net income for the period was $1.3 million, a substantial improvement compared to a dramatic loss in the prior year [12] - The company's assets grew to $225 million, although this figure was volatile due to mark-to-market adjustments [13] Business Line Data and Key Metrics Changes - The lender's contribution to revenue increased by almost $20 million for the year, highlighting its importance in future plans [10] - Revenue from trading activities saw a dramatic increase, with a reported gain of about $6.4 million on Alzamend, although this was misleading as no shares were sold [10] - Crypto revenue experienced a significant increase, with the company expecting a dramatic escalation in Bitcoin mined due to new machines being delivered [11] Market Data and Key Metrics Changes - Gresham Worldwide, a subsidiary, reported a 47% increase in performance compared to the previous year, benefiting from additional capital allocation [20] - The company noted volatility in its portfolio due to market fluctuations, particularly with positions in Alzamend and Mullen Technology [14][17] Company Strategy and Development Direction - The company plans to split into two separate entities, BitNile and Ault Alliance, to better reflect their distinct business models and growth trajectories [7][29] - BitNile will focus on cryptocurrency mining and data center operations, while Ault Alliance will manage other subsidiaries and seek stable, mature companies for acquisition [48][46] - The company is exploring the possibility of issuing Bitcoin as a dividend to shareholders, indicating a forward-thinking approach to capital distribution [49] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, highlighting the potential for significant revenue growth in the coming years, particularly with BitNile's mining operations [60] - The company acknowledged the volatility in quarterly earnings but emphasized the long-term growth story driven by blockchain technology [62] - Management noted that the current structure creates volatility but is necessary for the company's transformation and growth [13][21] Other Important Information - The company has secured the new symbol NILE for its upcoming name change to BitNile Holdings, which will take effect before the end of the year [48] - The management team emphasized the importance of transparency, committing to biweekly updates on mining activities and Bitcoin production [42] Q&A Session Summary Question: What is the outlook for the company's growth? - Management highlighted that 2021 has been a successful year with significant capital raised and a strong balance sheet, positioning the company for future growth [58] Question: How does the company plan to manage its debt? - The company reported less than $2 million in total debt, indicating a strong balance sheet and no immediate need for financing to service debt obligations [22] Question: What are the expectations for revenue from mining operations? - Management projected that with the ramp-up of mining operations, the company could achieve a run rate of approximately $300 million in revenue, depending on market conditions [36]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q þ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended September 30, 2021 o Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ________ to ________. Commission file number 1-12711 AULT GLOBAL HOLDINGS, INC. (Exact name of registrant as specified in its charter) Delaware 94-1721931 (State or oth ...