BitMine Immersion Technologies Inc(BMNR) - 2026 Q1 - Quarterly Report

Financial Performance - Total revenue for the three months ended November 30, 2025, was $2,293, an increase of 91% compared to $1,201 for the same period in 2024[88]. - The net loss for the three months ended November 30, 2025, was $5,204,095, compared to a loss of $974 in the same period in 2024[88]. - For the three months ended November 30, 2025, the company reported a net loss of $5,204,095 compared to a net loss of $974 in the same period of 2024[98]. - Adjusted EBITDA for the three months ended November 30, 2025, was $(21,715), a significant decline from $(501) in 2024[98]. Revenue Sources - Revenue from staking was $980 for the three months ended November 30, 2025, compared to $0 in the same period in 2024, marking the initiation of staking as a primary yield generation strategy[92]. - The company expects annual fees of $40,000 to $50,000 for managing its multi-billion dollar ETH portfolio, which it anticipates will be offset by projected staking fees[122]. - Revenue from consulting/advisory services and equipment leasing is recognized over time or at the point of transfer of control, with estimates including variable consideration and collectability[129]. Expenses and Losses - General and administrative expenses rose to $223,436 for the three months ended November 30, 2025, from $959 in the same period in 2024, primarily due to one-time capital raising and consulting fees[91]. - The company recorded an unrealized loss of $5,247,925 related to digital asset holdings for the three months ended November 30, 2025, compared to a gain of $85 in the same period in 2024[93]. - Net cash used in operating activities was $228,356 for the three months ended November 30, 2025, compared to $96 in the same period of 2024[117]. - Net cash used in investing activities was $7,422,439 for the three months ended November 30, 2025, primarily due to the purchase of ETH amounting to $7,527,221[118]. Asset Management - As of November 30, 2025, the total fair value of ETH and BTC holdings amounted to $10,544,339 and $17,450, respectively[93]. - The company recognized an unrealized gain from trading securities of $15,890 for the three months ended November 30, 2025, reflecting the change in fair value of its investment in Eightco[99]. - The change in fair value of warrant liability resulted in a gain of $158,212 for the three months ended November 30, 2025[99]. Liquidity and Financing - The company strengthened its liquidity through a public offering and private placements, with $4,617,859 still available from its at-the-market program as of November 30, 2025[77]. - Net cash provided by financing activities was $8,026,474 for the three months ended November 30, 2025, driven by proceeds from the company's ATM Offering[119]. - The company had $887,678 in cash on hand and working capital of $751,900 as of November 30, 2025[113]. Strategic Focus - The company expects to maintain a flexible cost structure aligned with service activity and treasury scale, with modest capital expenditures relative to a mining-centric model[81]. - The company has pivoted to a services-led model, reducing proprietary mining exposure and focusing on advisory and leasing services[107]. - The company anticipates that staking yields will evolve with validator participation rates and market conditions, focusing on security and liquidity[80]. - The company is monitoring key trends such as Ethereum protocol upgrades and institutional adoption trends that may impact future results[82]. Accounting and Reporting - In fiscal year 2025, the company will account for eligible digital assets at fair value, with changes recognized in net income, potentially increasing volatility in reported results[127]. - The company recognizes digital assets received from operations under ASC 606 and monitors for impairment indicators, with estimates based on market price volatility and timing of transactions[128]. - The company depreciates miners and related equipment over useful lives of 2–10 years and evaluates long-lived assets for impairment when indicators arise[130]. - Stock-based compensation is measured at grant-date fair value using observable market prices and option-pricing models, with key inputs including volatility and risk-free rates[131]. - Certain financing arrangements contain embedded features accounted for as derivatives, with fair value estimated using market-based models[132]. - The company assesses collectability of receivables based on customer creditworthiness and establishes allowances for expected credit losses based on historical experience[133]. Internal Controls - Management has identified material weaknesses in internal control over financial reporting as of November 30, 2025, and is implementing measures to improve these controls[135][136]. - There were no changes in internal control over financial reporting during the quarter ended November 30, 2025, that materially affected the controls[138].