Company: ORBS
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023549
Chunk: 99

Company: Eightco Holdings Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 2
Chunk 99
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 to be measured at fair value, with changes recognized
in net income each reporting period.

Key
effects include:

●Digital
                                            assets are presented at fair value on our balance sheets

●Unrealized
                                            gains and losses from price fluctuations flow through earnings

●Earnings
                                            may be more volatile due to digital asset market movements

●Historical
                                            impairment-only accounting no longer applies

This
measurement model increases transparency but introduces meaningful volatility tied to the valuation of Worldcoin and other digital assets.

Volatility
and Earnings Sensitivity

Because
we measure eligible crypto assets at fair value under ASU 2023-08, period-to-period changes in the market price of Worldcoin (WLD/WCWLD)
and other digital assets will directly affect reported earnings and cash provided by (used in) operating activities to the extent realized
on conversion. This may result in material earnings volatility unrelated to our Forever 8 operating performance.

31

Critical
Accounting Policies and Significant Judgments and Estimates

There
were no material changes to our critical accounting policies during the three and nine months ended September 30, 2025, other than the
adoption of ASU 2023-08, which requires eligible crypto assets to be measured at fair value with changes recognized in net income. Our
significant accounting policies are described in Note 2 to the condensed consolidated financial statements included in this Quarterly
Report and in the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024.

Key
Components of our Results of Operations

Revenues

We
generate the substantial majority of our revenues from inventory financing and inventory management services through our wholly owned
subsidiary, Forever 8. Our revenues are primarily derived from the purchase and resale of consumer products to e-commerce retailers under
our inventory management solutions model. Following the adoption of our Digital Asset Treasury (“DAT”) strategy in September
2025, the Company does not expect to generate revenue from digital asset activities.

Cost
of Revenues

Cost
of revenues includes the cost of purchased inventory, materials and supplies, internal labor and related benefits, subcontractor costs,
depreciation, overhead, and shipping and handling costs. These costs are directly associated with our Forever 8 inventory management
activities. We no longer incur costs related to the purchase or resale of Bitcoin mining equipment, as this line of business is no longer
pursued.

Selling,
General and Administrative Expenses

Selling,