Financial Performance - Total revenues for Q4 2025 were $40 million, representing an 11% year-over-year decrease[4] - Net income attributable to SBC Medical Group for Q4 2025 was $14 million, a 117% year-over-year increase[4] - Earnings per share for Q4 2025 was $0.14, reflecting a 133% year-over-year increase[4] - Full-year 2025 total revenues were $174 million, a 15% year-over-year decrease[11] - Full-year net income attributable to SBC Medical Group was $51 million, a 9% year-over-year increase[11] - Full-year EBITDA was $70 million, representing a 21% year-over-year decrease, with an EBITDA margin of 40%[11] - Total revenues for the year ended December 31, 2025, were $173,607,489, a decrease of 15.4% from $205,415,542 in 2024[20] - Net income for the year ended December 31, 2025, was $51,045,023, compared to $46,689,892 in 2024, reflecting an increase of 9.7%[20] - Income from operations for the year ended December 31, 2025, was $67,486,398, compared to $70,303,710 in 2024, reflecting a decline of 4%[26] - EBITDA for the year ended December 31, 2025, was $70,170,698, down 21.3% from $89,162,052 in 2024[26] - EBITDA margin decreased to 40% in 2025 from 43% in 2024[26] - Net income margin improved to 29% in 2025, up from 23% in 2024[26] Customer and Franchise Growth - The number of franchise locations increased to 283 as of December 31, 2025, up by 34 locations from the previous year[4] - The customer count for the last twelve months ended December 31, 2025, was 6.6 million, a 12% year-over-year increase[4] - Average revenue per customer in Q4 2025 was $316, an 11% year-over-year increase[8] Cash Flow and Equity - Cash provided by operating activities for the year ended December 31, 2025, was $24,668,496, an increase from $20,582,933 in 2024[22] - Cash and cash equivalents at the end of the year were $163,773,838, an increase from $125,044,092 at the beginning of the year[24] - Net cash provided by financing activities was $38,292,183, compared to $22,965,400 in the previous year[24] - Cash paid for income taxes increased to $37,190,188 in 2025 from $30,239,002 in 2024[24] - Total stockholders' equity as of December 31, 2025, was $263,304,706, up from $195,022,158 in 2024, marking a growth of 35%[19] Impairment and Adjustments - The company reported a foreign currency translation adjustment loss of $14,589,478 for the three months ended December 31, 2025[20] - The company incurred an impairment loss on intangible assets of $15,058,965 in 2024, which was not repeated in 2025[20] - The company reported an impairment loss of $15,058,965 in 2024, which was not present in 2025[26] - The effect of exchange rate changes resulted in a decrease of $3,259,381 in cash flow[24] Strategic Initiatives - The company aims to advance its multi-brand strategy in dermatology and expand its non-aesthetic healthcare portfolio in 2026[9]

Financial Performance - Total revenues for Q4 2025 were $40 million, representing an 11% year-over-year decrease[4] - Full-year 2025 total revenues were $174 million, a 15% year-over-year decrease[11] - Total revenues for the year ended December 31, 2025, were $173,607,489, a decrease of 15.4% from $205,415,542 in 2024[20] - Total revenues for the year ended December 31, 2025, were $173,607,489, a decrease of 15.5% compared to $205,415,542 for the year ended December 31, 2024[26] Net Income - Net income attributable to SBC Medical Group for Q4 2025 was $14 million, a 117% year-over-year increase[4] - Full-year net income attributable to SBC Medical Group was $51 million, a 9% year-over-year increase[11] - Net income for the year ended December 31, 2025, was $51,045,023, compared to $46,689,892 in 2024, reflecting an increase of 9.7%[20] - Net income margin improved to 29% for the year ended December 31, 2025, compared to 23% for the year ended December 31, 2024[26] Earnings and EBITDA - Earnings per share for Q4 2025 was $0.14, reflecting a 133% year-over-year increase[4] - Full-year EBITDA was $70 million, representing a 21% year-over-year decrease, with an EBITDA margin of 40%[11] - EBITDA for the year ended December 31, 2025, was $70,170,698, down from $89,162,052 in 2024, reflecting a decrease of 21.3%[26] - The company reported an EBITDA margin of 40% for the year ended December 31, 2025, down from 43% in 2024[26] Customer and Franchise Growth - The number of franchise locations increased to 283 as of December 31, 2025, up by 34 locations from the previous year[4] - The total number of customers in the last twelve months was 6.6 million, a 12% year-over-year increase[4] - Average revenue per customer in Q4 2025 was $316, an 11% year-over-year increase[8] Operating Expenses and Cash Flow - Operating expenses for the year ended December 31, 2025, totaled $59,797,324, a decrease from $85,746,797 in 2024, indicating a reduction of 30.3%[20] - Cash provided by operating activities for the year ended December 31, 2025, was $24,668,496, an increase from $20,582,933 in 2024[22] - Cash and cash equivalents at the end of the year increased to $163,773,838 from $125,044,092 at the beginning of the year, representing a growth of 30.9%[24] - Net cash provided by financing activities for the year was $38,292,183, compared to $22,965,400 in the previous year, indicating a significant increase of 66.5%[24] - Cash paid for income taxes increased to $37,190,188 for the year ended December 31, 2025, compared to $30,239,002 in 2024, reflecting a rise of 22.5%[24] Equity and Liabilities - Total stockholders' equity as of December 31, 2025, was $263,304,706, up from $195,022,158 in 2024, marking a growth of 35%[19] - The company’s total liabilities and stockholders' equity as of December 31, 2025, amounted to $380,447,946, compared to $266,083,154 in 2024[19] - The number of shares outstanding as of December 31, 2025, was 102,576,943, compared to 102,750,816 shares in 2024[20] - The total borrowings from banks and others amounted to $34,753,946, with repayments of bank and other borrowings totaling $(1,353,071) for the year[24] Impairment Loss - The company incurred an impairment loss on intangible assets of $15,058,965 during the year ended December 31, 2024[20] - The company experienced an impairment loss of $15,058,965 in the year ended December 31, 2024, with no impairment loss reported in 2025[26] Strategic Initiatives - The company aims to advance its multi-brand strategy in dermatology and expand its non-aesthetic healthcare portfolio in 2026[9] - The company reported a foreign currency translation adjustment loss of $14,589,478 for the three months ended December 31, 2025[20] - Income from operations for the year ended December 31, 2025, was $67,486,398, a slight decrease from $70,303,710 in 2024[26]

Bitcoin Holdings and Mining Operations - As of March 25, 2026, the company accumulated approximately 6,963 Bitcoin in reserve, positioning it among the top 16 publicly traded Bitcoin treasury companies based on total Bitcoin holdings [242]. - The company purchased a total of 28,578 Bitcoin miners, increasing its operational fleet to approximately 59,000 miners, representing approximately 25.0 EH/s at an average efficiency of 14.1 J/TH [242]. - The company operated Bitcoin miners at four sites, with a planned fleet upgrade completed in April 2025 to improve efficiency [254]. - Bitcoin production increased to 1,789 Bitcoin in 2025 from 1,184 Bitcoin in 2024, with average revenue per Bitcoin mined rising to approximately $103,521 [268]. - Bitcoin mined decreased to 1,184 in 2024 from 2,138 in 2023 due to increased network difficulty and the halving event in April 2024 [278]. Financial Performance - Revenue for the year ended December 31, 2025 was $185.2 million, a $113.7 million increase from $71.5 million in 2024, driven by improved mining efficiencies and the deployment of Bitcoin miners [268]. - Revenue increased to $71.5 million in 2024 from $65.0 million in 2023, driven by higher average revenue per Bitcoin mined, which rose to $60,436 from $30,398 [278]. - Adjusted EBITDA for 2025 was $(157.3) million, a decrease of $674.9 million from $517.6 million in 2024, impacted by non-recurring transaction costs [267]. - Loss on digital assets was $227.1 million in 2025, compared to a gain of $509.3 million in 2024, attributed to a decline in Bitcoin prices [272]. - Other income increased to $56.7 million in 2025 from $9.3 million in 2024, driven by a significant gain on derivatives [273]. Costs and Expenses - Cost of revenue increased to $92.0 million in 2025 from $39.5 million in 2024, reflecting higher uptime due to fleet upgrades and new Bitcoin miners [269]. - General and administrative expenses decreased slightly to $33.4 million in 2025 from $34.5 million in 2024, mainly due to lower share-based payments [271]. - Depreciation and amortization expenses rose to $58.2 million in 2025, up $35.5 million from $22.7 million in 2024, primarily due to increased depreciable asset base from fleet upgrades [270]. - Cost of revenue decreased to $39.5 million in 2024 from $43.6 million in 2023, primarily due to relocating mining operations to lower-cost sites [279]. - Depreciation and amortization expense increased to $22.7 million in 2024 from $14.4 million in 2023, driven by the Hut Business Combination [280]. Tax and Cash Flow - Income tax benefit for 2025 was $18.1 million, a $77.7 million increase from a provision of $59.6 million in 2024, primarily due to losses on digital assets [274]. - Income tax provision rose to $59.6 million in 2024 compared to an income tax benefit of $18.8 million in 2023, due to deferred taxes related to Bitcoin holdings [284]. - Net cash used in operating activities was $79.6 million in 2025, compared to $54.0 million in 2024, primarily due to a net loss of $153.2 million [292]. - Net cash used in investing activities totaled $398.3 million in 2025, reflecting significant Bitcoin purchases [293]. - Net cash provided by financing activities was $481.7 million in 2025, primarily from the issuance of Class A common stock [294]. Strategic Developments - The 2025 At-The-Market Offering Program allowed the company to offer and sell up to $2.1 billion of Class A common stock, resulting in gross proceeds of approximately $351.3 million by March 25, 2026 [242]. - The company completed a merger with Gryphon on September 3, 2025, which was accounted for as a reverse acquisition, renaming Gryphon to American Bitcoin Corp [242]. Market Conditions - The current Bitcoin block reward is 3.125 Bitcoin, with the next halving event expected in 2028, which may impact the company's mining revenue [260]. - Power costs are a significant component of the company's mining expenses and can be highly volatile, impacting profitability [261]. - The price of Bitcoin and network difficulty significantly affect the company's revenue and operational results [257][259].

Bitcoin Holdings and Mining Operations - As of March 25, 2026, the company accumulated approximately 6,963 Bitcoin in reserve, positioning it among the top 16 publicly traded Bitcoin treasury companies based on total Bitcoin holdings[242]. - The company purchased a total of 28,578 Bitcoin miners, increasing its operational fleet to approximately 59,000 miners, representing approximately 25.0 EH/s at an average efficiency of 14.1 J/TH[242]. - The company operated Bitcoin miners at four sites, with a planned fleet upgrade completed in April 2025 to improve efficiency[253][254]. - Bitcoin production increased to 1,789 Bitcoin in 2025 from 1,184 Bitcoin in 2024, with average revenue per Bitcoin mined rising to approximately $103,521[268]. - Bitcoin mined decreased to 1,184 in 2024 from 2,138 in 2023 due to increased network difficulty and the halving event in April 2024[278]. Financial Performance - Revenue for the year ended December 31, 2025 was $185.2 million, a $113.7 million increase from $71.5 million in 2024, driven by improved mining efficiencies and the deployment of Bitcoin miners[268]. - Revenue increased to $71.5 million in 2024 from $65.0 million in 2023, driven by a rise in average revenue per Bitcoin mined to $60,436 from $30,398[278]. - Adjusted EBITDA for 2025 was $(157.3) million, a decrease of $674.9 million from $517.6 million in 2024, impacted by non-recurring transaction costs[267]. - Adjusted EBITDA is used by the company to evaluate financial performance, defined as net loss or income adjusted for various expenses, providing a clearer view of operational performance[262][263]. Costs and Expenses - Cost of revenue increased to $92.0 million in 2025 from $39.5 million in 2024, reflecting higher uptime due to fleet upgrades and new Bitcoin miners[269]. - Cost of revenue decreased to $39.5 million in 2024 from $43.6 million in 2023, primarily due to relocating mining operations to lower-cost sites[279]. - Depreciation and amortization expenses rose to $58.2 million in 2025, up $35.5 million from $22.7 million in 2024, primarily due to increased depreciable asset base from fleet upgrades[270]. - General and administrative expenses decreased slightly to $33.4 million in 2025 from $34.5 million in 2024, mainly due to lower share-based payments[271]. Market and Economic Factors - The current Bitcoin block reward is 3.125 Bitcoin, with the next halving event expected in 2028, which may impact the company's mining revenue[260]. - The company’s business is heavily dependent on Bitcoin prices, which have historically experienced significant volatility, impacting revenue generation[257]. - Power costs are a significant component of the company's mining expenses and can be highly volatile, impacting profitability[261]. Mergers and Offerings - The company completed a merger with Gryphon on September 3, 2025, which was accounted for as a reverse acquisition, renaming Gryphon to American Bitcoin Corp[242]. - The 2025 At-The-Market Offering Program allowed the company to offer and sell up to $2.1 billion of Class A common stock, resulting in gross proceeds of approximately $351.3 million by March 25, 2026[242]. - The company entered into a Controlled Equity Offering Sales Agreement to offer up to $2.1 billion of Class A common stock[288]. Income and Losses - Loss on digital assets was $227.1 million in 2025, compared to a gain of $509.3 million in 2024, attributed to a decline in Bitcoin prices[272]. - Other income increased to $56.7 million in 2025 from $9.3 million in 2024, driven by a significant gain on derivatives[273]. - Income tax benefit for 2025 was $18.1 million, a $77.7 million increase from a provision of $59.6 million in 2024, primarily due to losses on digital assets[274]. - Loss from discontinued operations was nil in 2025, compared to $4.8 million in 2024, following the closure of the Drumheller site[275]. Cash Flow - Net cash used in operating activities was $79.6 million in 2025, reflecting a net loss of $153.2 million[292]. - Net cash used in investing activities totaled $398.3 million in 2025, primarily for Bitcoin purchases amounting to $405.1 million[293]. - Net cash provided by financing activities was $481.7 million in 2025, including $237.7 million from the issuance of Class A common stock[294]. - As of December 31, 2025, the company held 5,401 Bitcoin, with a fair value of approximately $472.6 million[302].

Financial Results - Kopin Corporation announced unaudited financial results for Q4 2025 on March 27, 2026[4]. - The report includes key performance metrics and user data, although specific figures are not provided in the extracted content[4]. - The financial results are not deemed "filed" under the Securities Exchange Act of 1934, indicating a preliminary status[4]. - The press release detailing the financial results is attached as Exhibit 99.1[4]. - The report was signed by Erich Manz, Treasurer and Chief Financial Officer, indicating official endorsement of the financial data[11]. - No specific guidance or future outlook was mentioned in the extracted content[4]. - The financial statements and exhibits are referenced but not detailed in the extracted content[5]. Company Information - The company is listed on the Nasdaq Capital Market under the trading symbol KOPN[2]. - The company has not indicated whether it is an emerging growth company in the current filing[3]. - There is no information on new products, technologies, market expansion, or mergers and acquisitions in the provided documents[4].

Revenue Concentration and Customer Relationships - Customer A and its affiliates accounted for 24.0% of the company's revenues in 2025, with the two largest customers together accounting for over 33%[35] - The concentration of revenues and accounts receivable exposes the company to increased credit risk, particularly with significant reliance on a few major customers[35] - The company's two largest customers accounted for 28.7% and 11.0% of revenues in 2023, indicating a strong reliance on key clients[195] Product Development and Innovation - The company is expanding its product offerings to non-driver products, which may have higher gross margins, including technologies such as Timing controller (TCON), LCoS microdisplay, and CMOS image sensors[32] - The company is developing innovative display driver solutions to maintain market share and average selling prices amid competitive pressures[41] - The company may face challenges in developing and introducing new products to meet evolving industry standards, which could impact market competitiveness[71] - Himax has developed industry-leading WiseEye Ultralow Power AI Sensing technology, which is utilized in consumer electronics and AIoT applications[106] - The company has developed LCoS microdisplay technologies that offer higher brightness and lower power consumption, positioning it well in the AR glasses market[193] Market Trends and Competitive Landscape - OLED technology is gradually penetrating the mid to high-end TFT-LCD market, with increasing adoption in smartphones, tablets, TVs, and automotive displays[43] - The average selling prices of TFT-LCD and OLED panels generally decline over time, which could negatively impact the company's revenues and profit margins[30] - Increased competition in the semiconductor industry may lead to pricing pressure and loss of market share, adversely affecting revenues[70] - The global TFT-LCD panel industry is concentrated among a small number of manufacturers, primarily based in Asia, which impacts pricing and demand for display driver companies[111] Supply Chain and Manufacturing Risks - The reliance on third-party foundries for wafer manufacturing poses risks, including potential capacity constraints and quality issues, which could disrupt product shipments[44][45] - The company does not have long-term agreements guaranteeing production capacity, which increases vulnerability to supply chain disruptions[49] - Shortages of key components for customers' products could decrease demand for the company's products, adversely affecting sales[51] - The company has established in-house facilities for key manufacturing processes of non-driver products, but uncertainties exist in their development and commercialization[34] Financial and Operational Risks - The company faces risks related to public health epidemics, which could disrupt operations and adversely affect financial results[39] - The company lacks long-term purchase commitments from customers, leading to significant revenue uncertainty and potential adverse effects on financial results[59] - The company is exposed to risks from fluctuations in exchange rates, particularly between the U.S. dollar and the NT dollar[82] - Changes in ROC tax laws could increase the company's effective tax rate and adversely affect operating results[83] Strategic Partnerships and Investments - The company has made strategic minority investments in various companies to enhance its technology and product offerings[103] - The company focuses on strategic partnerships with Tier 1 customers for LCoS microdisplays and 3D sensing technologies to penetrate emerging markets[197] - The company plans to strengthen relationships with existing semiconductor manufacturing service providers and diversify its network to ensure access to high-quality manufacturing capacity[217] Environmental and Regulatory Considerations - Climate change and natural disasters pose risks to production capabilities and supply chain operations, potentially leading to financial losses[73] - Compliance with climate-related regulations may increase operational costs and require changes to manufacturing processes, impacting financial results[74] Technological Advancements and Capabilities - Himax's display drivers utilize advanced interface technologies such as mini-LVDS and point-to-point high-speed interfaces, supporting data rates up to 4Gbps for 8K 120Hz applications[123] - The company has initiated production of capacitive touch controller ICs for on-cell TFT-LCD displays, expanding its customer base in the smartphone and tablet markets[140] - The WiseEye AI processor is designed for ultralow power applications, with capabilities under 1mW, suitable for resource-constrained environments[185] Quality Assurance and Customer Collaboration - The company has a comprehensive quality assurance system, including regular audits of suppliers and extensive quality controls to maintain high standards[210] - The company emphasizes close collaboration with customers to create customized products that meet their specifications and performance requirements[199]

Macroeconomic and Geopolitical Risks - The company faces significant risks from macroeconomic conditions, including potential economic downturns and rising inflation, which could adversely affect financial performance and consumer spending on entertainment [35]. - The ongoing conflict in Ukraine and other geopolitical tensions may disrupt business operations and impact global financial markets, potentially leading to reduced client spending [35]. Regulatory and Compliance Risks - Changes in public perception regarding sports betting could lead to increased regulation and restrictions, adversely affecting the company's operations and revenue [46]. - The company faces regulatory risks due to ongoing disputes between state regulators and prediction markets, which could affect the marketability and profitability of its products [52]. - The company may face legal and regulatory risks related to sports betting, with varying laws across jurisdictions that could impact operations and demand for products and services [105]. - Compliance with privacy and data protection laws is critical, as failure to meet these obligations could harm the company's reputation and financial condition [125]. - The company is subject to varying regulatory requirements across jurisdictions, which may complicate operations and increase compliance costs [117]. - The company faces significant compliance costs and operational changes due to evolving data protection laws, which may adversely affect its business and financial condition [128]. - The regulatory framework for AI is rapidly evolving, with potential fines of up to €35 million or 7% of total worldwide annual group turnover for non-compliance with the EU AI Act, which could impact the company's operations and reputation [102]. Operational and Technological Risks - The company relies heavily on strategic relationships with sports leagues for data and statistics, and any failure to maintain these partnerships could harm competitive advantage and financial results [44]. - The company is exposed to foreign exchange risks due to international operations and assets denominated in currencies other than Euros, which could lead to financial losses [39]. - The company must effectively manage growth to maintain employee morale and product quality, or risk harming its business operations [70]. - The company faces significant technology risks, including the need to adopt new technologies and develop market-accepted products to remain competitive [77]. - The company is exposed to potential errors and bugs in its software, which could adversely affect its financial condition and client relationships [79]. - Cybersecurity risks remain a significant concern, with potential breaches leading to reputational damage and financial liabilities [80]. - The company has experienced interruptions in its systems, which could impact service delivery and overall business operations [87]. - The reliance on third-party information technology systems, including AWS and Microsoft, poses risks; any disruptions or performance issues could adversely affect the company's operations and financial condition [92]. Client and Market Dynamics - The competitive landscape is evolving, with new entrants and technologies posing risks to market share and profitability, particularly as jurisdictions legalize sports betting [49]. - The company generated 6.6% and 6.5% of total revenue from a single client for the fiscal years ended December 31, 2025 and 2024, respectively, and 26.3% and 28.9% from the top ten clients combined [59]. - The Customer Net Retention Rate for the top 200 clients, representing approximately 79% of revenue, was 109% in 2025 and 127% in 2024, indicating strong client expansion capabilities [224]. - The company is focused on expanding its market presence and product innovation in response to the growing demand for sports data and analytics [209]. Financial Performance and Projections - The company anticipates increased costs in future periods, which may negatively impact operating results and profitability [163]. - The company may face challenges in generating sufficient revenue to maintain profitability or positive cash flow on a sustained basis [162]. - The company expects to continue significant spending on client acquisition primarily through digital and direct marketing channels [57]. - The company may require additional capital to respond to future business opportunities, which could impact its ability to execute its business plan [168]. Intellectual Property and Legal Risks - The company’s ability to protect its intellectual property rights is critical for maintaining competitive advantages, and failure to do so could materially affect its business [135]. - The company may face claims of infringement or misappropriation of third-party intellectual property, which could require substantial damages or settlement costs [138]. - The company employs individuals from competitors, which may expose it to claims of using proprietary information from former employers, potentially leading to costly litigation [139]. Internal Control and Governance - The company identified a material weakness in its internal control over financial reporting, which could lead to material misstatements in financial statements and impair compliance with applicable laws and regulations [156]. - The Company reported a material weakness in internal control over financial reporting, leading to an adverse opinion from KPMG AG as of December 31, 2025 [159]. - The company has made significant progress in strengthening internal controls, including improvements in segregation of duties and IT general controls [158]. Market Opportunities and Growth - The global sports betting market is projected to grow from $127.1 billion in 2025 to $192.7 billion in 2030, with a compound annual growth rate (CAGR) of 9% [214]. - In the United States, the sports betting market is expected to expand from $2.2 billion in 2020 to $19.7 billion in 2025, representing a 55% CAGR, and further to $35.7 billion by 2030, growing at a CAGR of 13% [215]. - Interactive betting, including online and mobile betting, accounted for 70% of total sports betting in 2025 and is anticipated to exceed 75% by 2030 [212]. Shareholder and Corporate Governance - The Company has a dual class share structure, with the Founder holding 78.5% of the total voting power, potentially limiting other shareholders' influence [178]. - The company is a foreign private issuer, exempt from certain U.S. reporting requirements, which may limit shareholder protections compared to U.S. domestic companies [183]. - Anti-takeover provisions in the company's Articles may discourage beneficial acquisition proposals, potentially depressing Class A share prices [191].

Company Overview - The company specializes in advanced LiDAR hardware and software solutions for vehicles, focusing on safety and autonomous capabilities[134]. Financial Transactions - In March 2025, the company exchanged $18.2 million of 1.25% Convertible Senior Notes for approximately 1,951,819 shares of Class A common stock[138]. - In May 2025, the company exchanged $6.2 million of Convertible Senior Notes for 1,098,931 shares of Class A common stock and repurchased $43.8 million of notes for $30.3 million in cash[139]. - On January 11, 2026, the company agreed to sell LiDAR assets for cash consideration of $22.0 million[168]. - The company completed the sale of LiDAR assets to MicroVision for $33.0 million on February 3, 2026[169]. - The company sold LSI to QCi for $110.0 million in cash, with $89.4 million used to fund a cash tender offer for 1L Notes[171]. Bankruptcy and Restructuring - The company filed for Chapter 11 bankruptcy on December 15, 2025, with approximately $25.0 million in cash on hand to support operations during the process[156][157]. - The company’s Plan of Liquidation was filed to distribute proceeds from asset liquidation to stakeholders[158]. - The company filed for Chapter 11, leading to an event of default on its 2026 Convertible Senior Notes, 1L Notes, and 2L Notes[159]. - Operating results have been negatively impacted by Chapter 11, resulting in decreased revenue[160]. - The company executed a restructuring plan in 2024, reducing its workforce by 30%, with further reductions of 25% and 30% planned in 2025[163][164][165]. - As of December 31, 2025, the company incurred $6.0 million in employee-related charges from restructuring plans[166]. - The company initiated the wind-down of its data and insurance businesses during 2025[167]. - The company expects to incur significant reorganization expenses related to its Chapter 11 proceedings[191]. - The company recognized $46.3 million in reorganization items related to Chapter 11 cases in 2025, with no comparable amounts for 2024[207]. Revenue and Expenses - Revenue for the year ended December 31, 2025, was $66.0 million, a decrease of 12% from $75.4 million in 2024[192]. - The Autonomy Solutions segment revenue decreased by $12.6 million (24%) to $40.9 million, primarily due to a $21.8 million decrease in product revenue[194]. - Total operating expenses for 2025 were $218.6 million, down 47% from $409.3 million in 2024[192]. - Research and development expenses decreased by $94.1 million (41%) to $137.6 million, mainly due to reduced headcount and lower consultant fees[197]. - The net loss for 2025 was $366.3 million, an increase of 34% from a net loss of $273.1 million in 2024[192]. - Cash and cash equivalents as of December 31, 2025, totaled $21.7 million, with total liquidity of $24.3 million[210]. - Net cash used in operating activities was $196.5 million for 2025, compared to $276.6 million in 2024[214]. - Two customers accounted for 45% of the revenue in 2025, with one customer alone contributing 39% in 2024[176]. Accounting and Financial Reporting - Liabilities related to the Chapter 11 reorganization are classified as liabilities subject to compromise, affecting the consolidated balance sheets[225]. - Changes in the fair value of derivative liabilities are recorded in the consolidated statement of operations as either other income or expense[224]. - The company evaluates embedded features of convertible and senior notes to determine if they qualify as derivatives, impacting financial reporting[224]. - The accounting treatment for transactions related to debt modification or extinguishment is assessed under ASC 470-50, affecting income recognition[224]. - The company uses a range of sales prices from actual sales to estimate standalone selling prices (SSP) for performance obligations[222]. - Recent accounting pronouncements are detailed in the financial statements, impacting the company's accounting policies[227]. - The company is not required to provide market risk disclosures as it qualifies as a smaller reporting company[228]. - Changes in judgments regarding revenue recognition assumptions could significantly impact financial results[223]. Manufacturing and Sourcing - The company has been evaluating alternatives for manufacturing arrangements after Celestica terminated its master services agreement[136][155]. - The company has transitioned sourcing strategies to reduce manufacturing costs, completing changes in 2023 and 2024[137].

Business Operations and Client Base - The company provided custody, wallet, liquidity, and infrastructure solutions to over 5,320 clients and over 1.2 million users as of December 31, 2025, with approximately $81.6 billion in Assets on Platform (AoP) [36] - The number of clients served was over 5,320 across more than 100 countries as of December 31, 2025 [65] - The company serves government agencies across the world, including those in the United States and El Salvador, with expectations for continued opportunities in this segment [70] - The company had 603 full-time employees as of December 31, 2025, across multiple regions including the United States, Canada, Europe, Asia, Latin America, and the Middle East [132] Financial Performance - Digital asset sales revenue increased by $13.0 billion as of December 31, 2025, compared to the previous year [54] - The company generated approximately $15.6 billion in digital asset sales revenue for the year ended December 31, 2025, representing a 512.6% increase from the previous year [76] - Lending fees generated for the year ended December 31, 2025, were approximately $18.1 million, compared to $5.8 million for the year ended December 31, 2024 [77] - The company generates interest income from client funds held in segregated accounts and corporate cash, with higher interest rates typically increasing interest income [654] Digital Assets and Treasury Management - The company supported over 1,770 digital assets and had $15.6 billion in Assets Staked as of December 31, 2025 [38][53] - The company has maintained a Bitcoin treasury of 1,673 Bitcoin valued at $146.4 million, representing approximately 42.5% of total digital intangible asset value as of December 31, 2025 [49] - The company’s strategy to increase Bitcoin treasury holdings is subject to market conditions and operational cash flow requirements [50] - A hypothetical 50.0% increase or decrease in the fair value of Bitcoin holdings would have impacted net income by approximately $73.2 million, $109.5 million, and $40.6 million for the years ended December 31, 2025, 2024, and 2023, respectively [659] Regulatory Compliance and Framework - The company received approval to convert BitGo Trust Company, Inc. to a federally chartered national trust bank, enhancing its regulatory framework [37] - The company is subject to a complex regulatory framework across multiple jurisdictions, impacting its operations and compliance requirements [94] - BitGo's subsidiaries are licensed as money transmitters in various U.S. states and have obtained licenses for digital asset custody and trading solutions outside the U.S. [107] - The company is regulated by the Financial Crimes Enforcement Network (FinCEN) and must comply with anti-money laundering (AML) and counter-terrorist financing (CTF) laws [103] - The company is subject to ongoing supervision by the OCC and must adhere to capital adequacy and risk management standards [99] - The company has implemented a compliance program to prevent illicit activities, which requires significant resources and ongoing adaptation to regulatory changes [105] - The company is subject to regulatory scrutiny regarding whether certain digital assets could be classified as securities, which could lead to significant regulatory inquiries and operational impacts [115] Product Offerings and Services - The company offers Stablecoin-as-a-Service and Crypto-as-a-Service, providing clients with customizable API solutions for digital asset management [39][51] - The company aims to become the leading stablecoin platform as use cases for stablecoins continue to grow [60] - The company launched Stablecoin-as-a-Service in 2025, allowing institutional clients to issue U.S. dollar-backed stablecoins [79] - The company’s liquidity and prime solutions include staking, borrowing, lending, and end-to-end digital asset management [51] Intellectual Property and Legal Matters - The company has registered 15 trademarks in nine jurisdictions and has 81 pending trademark applications [88] - BitGo has made an irrevocable public patent pledge to not initiate lawsuits for patent infringement related to cryptocurrencies, provided certain conditions are met [91] - BitGo's broker-dealer business is registered with the SEC and is subject to regulations from FINRA and other authorities, covering all aspects of its operations [110] Risk Factors and Challenges - Digital asset prices have historically exhibited considerable volatility, with Bitcoin showing an average annualized standard deviation of daily price returns of approximately 50% over the last three years ending December 31, 2024 [659] - The company’s business model may face challenges due to the complex framework of U.S. and non-U.S. laws, which could lead to increased scrutiny and potential enforcement actions [121] - The company’s financial performance is significantly influenced by transaction fees from the trading of digital assets, which may vary based on payment method and transaction size [656] - The company is committed to compliance with various laws regarding the collection and use of personal data, which includes monitoring compliance with the Foreign Corrupt Practices Act and similar regulations [119][120] - The company has implemented policies to ensure compliance with anti-corruption laws and continuously monitors adherence to these regulations [120]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2025 or ☐ 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 001-36366 FG Nexus Inc. (Exact name of registrant as specified in its charter) Nevada 46-1119100 (Stat ...