Company: SLNH
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023503
Chunk: 215

Company: Soluna Holdings, Inc
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 215
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 several members of its senior leadership team directed by the CEO and CFO who use revenue and cost of revenues which formulate gross
profit (loss), as well as total general and administrative expenses of the reporting segments to assess the performance of the business
of our reportable operating segments and allocate resources. Operating profit (loss) is used to
evaluate actual results against expectations, which are based on comparable prior results, current budget, and current forecast. Non-cash
items of depreciation and amortization are included within both costs of sales and general and administrative expenses, however only
depreciation through the Company’s site levels are evaluated for segment performance.

In
the adoption of ASU 2023-07, the most significant provision was for the Company to disclose significant
segment expenses (ie: costs of revenue) that are regularly provided to the CODM. Utility costs, wages and benefit related costs, facility
and equipment costs, and depreciation costs at the site level were determined to be significant segment expenses. The CODM only
reviews general and administrative expenses by site level as a whole, and not by significant expenses. No operating segments have been
aggregated to form the reportable segments. The Company does not allocate all assets to the reporting segments as these are managed on
an entity-wide basis. Therefore, the Company does not separately disclose the total assets of its reportable operating segments.

The
Cryptocurrency Mining segment generates revenue from the cryptocurrency the Company earns through its Bitcoin mining activities, which
is currently generated from Project Dorothy, and previously from Project Sophie and Marie. The Data Center Hosting segment generated
revenue from hosting services provided to third-party Bitcoin mining customers at the Company’s data centers, which were previously
at Project Marie and are currently from Project Sophie and Project Dorothy. The High-Performance Computing Services segment may generate
revenue from either the sale or lease of HPC assets (such as Project Ada which leased GPUs), or from HPC/AI data centers to be leased
to third-party HPC/AI customers. This segment began generating revenue in December 2024, as Project Ada worked to build its customer
base. With the termination of the HPE Agreement, revenue was minimal for the nine months ended September 30, 2025 and a majority of the
costs associated with the termination of approximately $28.6 million were included in the December 31, 2024 financial statements.

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The
Company includes demand response revenue as a reconciling item of revenue and is not