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Sphere 3D(ANY) - 2024 Q4 - Annual Report
ANYSphere 3D(ANY)2025-03-28 20:25

Revenue and Financial Performance - Revenue for 2024 was 16.6million,adecreaseof16.6 million, a decrease of 5.3 million from 21.9millionin2023,primarilyduetoa21.9 million in 2023, primarily due to a 3.1 million decline in Bitcoin mining revenue and a 2.2milliondecreasefromthesoldServiceandProductsegment[180].−Directcostofrevenuesdecreasedto2.2 million decrease from the sold Service and Product segment [180]. - Direct cost of revenues decreased to 13.4 million in 2024 from 15.9millionin2023,primarilyduetolowerhostingfeesandthetransitiontonewerminingmachines[182].−Generalandadministrativeexpensesdecreasedto15.9 million in 2023, primarily due to lower hosting fees and the transition to newer mining machines [182]. - General and administrative expenses decreased to 12.4 million in 2024 from 15.8millionin2023,drivenbyreductionsinlegalfeesandoperatingcosts[185].−Investmentincomefor2024was15.8 million in 2023, driven by reductions in legal fees and operating costs [185]. - Investment income for 2024 was 9.0 million, attributed to a 4.1millionrealizedgainanda4.1 million realized gain and a 4.9 million unrealized gain on equity investment in Core Scientific Inc. [195]. - The company reported a net cash used in operating activities of 4.576millionfor2024,comparedto4.576 million for 2024, compared to 6.582 million in 2023, primarily due to a net loss of 9.5million[207].−Netcashprovidedbyinvestingactivitieswas9.5 million [207]. - Net cash provided by investing activities was 4.028 million in 2024, driven by 11.4millionfromthesaleofequitysecurities,offsetby11.4 million from the sale of equity securities, offset by 7.1 million in capital expenditures for mining equipment [208]. - The company received 5.387millionfromfinancingactivitiesin2024,anincreasefrom5.387 million from financing activities in 2024, an increase from 3.064 million in 2023, primarily from the issuance of common shares and warrants [209]. Mining Operations - Bitcoin mining operations experienced a reduction of 3,300 machines, or 22%, taken offline for relocation, impacting production and revenue [180]. - As of December 31, 2024, the company owned approximately 14,000 miners with a total hashrate capacity of 0.76 EH/s, and is transitioning to newer-generation machines [177]. - The company is focusing on reducing mining costs and refreshing its mining fleet to enhance efficiency and mitigate financial risks [205]. Compliance and Risks - The company has a period until September 2, 2025, to regain compliance with Nasdaq listing requirements after the bid price fell below 1.00pershare[181].−Significantrisksincludepotentialshortfallsinprojectedminingearningsandincreasesinoperatingcosts,whichcouldadverselyimpactthecompany′sabilitytocontinueoperations[206].CashandFunding−AsofDecember31,2024,thecompanyhadcashandcashequivalentsof1.00 per share [181]. - Significant risks include potential shortfalls in projected mining earnings and increases in operating costs, which could adversely impact the company's ability to continue operations [206]. Cash and Funding - As of December 31, 2024, the company had cash and cash equivalents of 5.4 million, an increase from 0.6millionatDecember31,2023[200].−Thecompanyexpectstoraiseupto0.6 million at December 31, 2023 [200]. - The company expects to raise up to 8.0 million through an At-the-Market Offering Program to fund working capital and corporate strategy initiatives [201]. - A Securities Purchase Agreement was executed on November 19, 2024, resulting in the issuance of 2,350,000 common shares at a price of 1.42pershare,generatingapproximately1.42 per share, generating approximately 5.4 million in net proceeds [203]. - The company has projected that cash on hand may not be sufficient to continue operations within 12 months if additional funding is not raised [204]. Asset Management - The fair value of Bitcoin held as of December 31, 2024, was approximately 1.4million,withthecompanyholdingabout14.9Bitcoin[178].−Thecompanyrecordedalossondisposalofpropertyandequipmentof1.4 million, with the company holding about 14.9 Bitcoin [178]. - The company recorded a loss on disposal of property and equipment of 3.5 million in 2024, related to the sale of 3,263 miners [187]. - The company early adopted ASU 2023-08, resulting in a 20,000decreasetotheopeningbalanceofaccumulateddeficitandanincreasetocryptocurrencyassets[178].InfrastructureDevelopment−Anew8MWminingsiteinIowawasenergizedonMarch10,2025,withtotalpaymentsof20,000 decrease to the opening balance of accumulated deficit and an increase to cryptocurrency assets [178]. Infrastructure Development - A new 8 MW mining site in Iowa was energized on March 10, 2025, with total payments of 2.8 million made towards infrastructure development [210][211].