Akerna (KERN) - 2024 Q3 - Quarterly Results

Financial Performance - Mining revenues for Q3 2024 were $3.7 million, a decrease from$5.2 million in Q3 2023[3] - The company reported a net loss of $5.9 million in Q3 2024, an improvement from a net loss of$8.1 million in Q3 2023[4] - Adjusted EBITDA loss narrowed to $2.5 million in Q3 2024, compared to a loss of$4.7 million in Q3 2023[5] - Total revenues for the three months ended September 30, 2024, were $3,689,000, a decrease of 32.6$5,477,000 for the same period in 2023[16] - The net loss for the nine months ended September 30, 2024, was $21,701,000, compared to a net loss of$17,619,000 for the same period in 2023, reflecting an increase in losses[16] - Digital asset revenue for the nine months ended September 30, 2024, was $(16,695,000), compared to$(14,992,000) in 2023, reflecting a decline in revenue of about 11.4%[21] Mining Operations - The company mined approximately 61 Bitcoin in Q3 2024, down from 176 Bitcoin in Q3 2023[5] - Breakeven cost per Bitcoin increased to $59,213 in Q3 2024, compared to$22,625 in Q3 2023[3] Assets and Liabilities - Total current liabilities as of September 30, 2024, were $26.4 million, with total assets of$7.5 million[6] - Total current assets decreased to $1,688,000 as of September 30, 2024, down from$5,398,000 as of December 31, 2023, indicating a significant reduction in liquidity[15] - Mining equipment, net, decreased to $4,737,000 as of September 30, 2024, from$12,916,000 as of December 31, 2023, showing a decline in capital assets[15] - Accounts payable and accrued liabilities increased to $7,142,000 as of September 30, 2024, compared to$3,649,000 as of December 31, 2023, indicating rising obligations[15] - The total stockholders' deficit increased to $(18,863,000) as of September 30, 2024, from$(599,000) as of December 31, 2023, reflecting deteriorating financial health[15] Cash Flow and Expenses - The company reported a net cash used in operating activities of $(2,368,000) for the nine months ended September 30, 2024, compared to a net cash provided of$3,064,000 in 2023[21] - Cash at the end of the period was $368,000, down from$1,405,000 at the end of the same period in 2023, representing a decrease of approximately 73.8%[21] - The company incurred depreciation expenses of $9,435,000 for the nine months ended September 30, 2024, compared to$11,906,000 in 2023, showing a reduction of about 20.7%[21] - The company reported a significant increase in general and administrative expenses, which rose to $2,439,000 for the three months ended September 30, 2024, compared to$804,000 for the same period in 2023[16] Equity and Financing - The company successfully restructured approximately $13 million of debt into equity at a 100$40 million, surpassing NASDAQ listing requirements[2] - The company raised $1,395,000 from the issuance of common stock through a private placement during the nine months ended September 30, 2024[21] - The cash acquired in connection with the reverse recapitalization was$500,000, which was not present in the previous year[21] Future Outlook - The company aims to expand Bitcoin mining operations and explore opportunities in AI computing[2] - Future initiatives are expected to be announced in the coming months to enhance shareholder value[2] Other Financial Metrics - The unrealized loss on marketable securities was $(21,000) for the three months ended September 30, 2024, compared to$(75,000) for the same period in 2023, indicating a slight improvement[16] - The impairment of digital assets was recorded at $1,295,000 for the nine months ended September 30, 2024, while there was no impairment recorded in the previous year[21] - The company reported a realized gain from the sale of digital assets of$16,649,000 for the nine months ended September 30, 2024, compared to $13,958,000 in 2023, indicating an increase of approximately 19.2$(1,504,000) for the nine months ended September 30, 2024, compared to $(1,902,000) in 2023, reflecting a decrease in cash outflow of about 21%[21]