Company: SLNH
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023503
Chunk: 81

Company: Soluna Holdings, Inc
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 81
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 their products and services; (iv) methods used to distribute the products or provide services; and
(v) if applicable, the nature of the regulatory environment. The Company’s reportable segments are identified based on the types
of service performed. The Company has three reportable segments: Cryptocurrency Mining, Data Center Hosting, and High-Performance Computing.
In the third quarter of 2024, the Company initiated Soluna Cloud Services, a new business line to provide high performance computing
services to support generative AI workstreams but decided to exit active provision of these services during the first quarter of 2025
and will focus in the future on provision of colocation services at our datacenters to host customers in the AI generative space.

The
guidance requires that segment disclosures present the measure(s) used by the Chief Operating Decision Maker (“CODM”) to
decide how to allocate resources and for purposes of assessing such segments’ performance. The Company’s CODM is composed
of 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