Company: SLNH
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010886
Chunk: 193

Company: Soluna Holdings, Inc
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 8
Chunk 193
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2025.

Cost of Cryptocurrency Mining Revenue, exclusive
of depreciation: Cost of cryptocurrency mining revenue includes direct utility costs, site overhead expenses, and overhead
costs that relate to the operations of our cryptocurrency mining facilities in Kentucky and Texas.

The increase in costs for the three months ended March
31, 2025 compared to three months ended March 31, 2024 relate mainly to slight increases in operating and electricity costs.

Cost of Data Hosting Revenue, exclusive of depreciation:
Cost of data hosting revenue includes utility charges, site overhead expenses, and other charges.

Cost of data hosting decreased for the three months
ended March 31, 2025 compared to the three months ended March 31, 2024 mainly due to a change in hosting contracts mix, in which contracts
were entered that included electricity passthrough contracts replacing fixed rate volume contracts.

Cost of High-Performance Computing Services:
Cost of high-performance computing services include operating expenses related to high performance computing services. The costs
of high-performance computing services were not material for the three months ended March 31, 2025 and there were no services for the
three months ended March 31, 2024. We do note that due to the termination of the HPE Agreement on March 24, 2025, we recognized a loss
of approximately $28.6 million for the year ended December 31, 2024, which represented the remaining obligations.

General and Administrative Expenses, exclusive
of depreciation and amortization: General and administrative expenses, exclusive of depreciation and amortization include cash
and non-cash compensation, benefits, and related costs in support of our general corporate operations, including general management, finance
and accounting, human resources, marketing, information technology, corporate development, and legal services.

    ●
    Stock
    based compensation expense was $1.8 million for the three months ended March 31, 2025 compared to approximately $656 thousand in
    relation to the three months ended March 31, 2024, an increase of approximately $1.2 million. Stock based compensation expense increased
    approximately $1.7 million during the three months ended March 31, 2025 compared to the three months ended March 31, 2024 primarily
    related to grants issued to directors and officers in April, June, September, and December of 2024 and grants issued to employees
    in December of 2024, however this increase was offset by approximately $500 thousand during the comparable