Company: ORBS
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004802
Chunk: 931

Company: Eightco Holdings Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 5
Chunk 931
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 outcomes, if the Company determines that a loss arising
from such matters is probable and can be reasonably estimated, an estimate of the contingent liability is recorded in its consolidated
financial statements. If only a range of estimated loss can be determined, an amount within the range that, based on estimates, assumptions
and judgments, reflects the most likely outcome, is recorded as a contingent liability in the consolidated financial statements.
In situations where none of the estimates within the estimated range is a better estimate of probable loss than any other amount, the
Company records the low end of the range. Any such accrual would be charged to expense in the appropriate period. Litigation expenses
for these types of contingencies are recognized in the period in which the litigation services were provided.

Warrants.
The Company classifies a warrant to purchase shares of its common stock as equity on its consolidated balance sheets as this warrant
is a free-standing financial instrument that is indexed to the Company’s own stock and meets the criteria for equity classification.
Each warrant is initially recorded within equity at the date of grant, net of issuance costs, and is not subsequently re-measured. Changes
in the fair value of the warrant are not recognized after the initial measurement. The warrants will remain classified in equity until
they are exercised or expire.

Revenue
Recognition. In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”)
606, Revenue from Contracts with Customers, the Company recognizes revenue when it satisfies performance obligations, by transferring
promised goods or services to customers, in an amount that reflects the consideration to which the Company expects to be entitled in
exchange for fulfilling those performance obligations. Revenue for product sales is recognized upon receipt by the customer. There are
no contract assets or contract liabilities and therefore no unsatisfied performance obligations. One customer represented 75% of total
revenues for the year ended December 31, 2024.

Disaggregation
of Revenue. The Company’s primary revenue streams include the sale of consumer goods through our inventory management solutions
business and the sale of corrugated packaging materials. There are no other material operations that were separately disaggregated for
segment purposes.

    F-11

EIGHTCO
HOLDINGS INC.

NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS

For
the Years ended December 31, 2024 and 2023

2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Cost
of Revenues. Cost of revenues includes