Company: BTBT
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001213900-25-044155
Chunk: 23

Company: Bit Digital, Inc
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 1
Chunk 23
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 obligation

Remaining
performance obligations represent the transaction price of contracts for work that have not yet been performed. The amount represents
estimated revenue expected to be recognized in the future related to the unsatisfied portion of the performance obligation.

Cost of revenue

The Company’s
cost of revenue consists primarily of (i) direct production costs related to mining operations, including electricity costs, profit-sharing
fees/variable performance fees and/or other relevant costs paid to our hosting facilities, (ii) direct production costs related to our
cloud services, including electricity costs, data center lease costs, and other relevant costs, (iii) direct production costs related
to our colocation services, including electricity costs, lease costs and other relevant costs, and (iv) direct cost related to ETH staking
business, including service fees payable to the service provider. 

Cost revenue excludes depreciation expenses, which
are separately stated in the Company’s consolidated statements of operations.

12

Foreign currency

Accounts expressed in foreign currencies are translated
into U.S. dollars. Functional currency assets and liabilities are translated into U.S. dollars generally using rates of exchange prevailing
at the balance sheet date of each respective subsidiary and the related translation adjustments are recorded as a separate component of
Accumulated other comprehensive income, net of any related taxes, in total shareholders’ equity. Income statement accounts expressed
in functional currencies are translated using average exchange rates during the period. Functional currencies are generally the currencies
of the local operating environment. Financial statement accounts expressed in currencies other than the functional currency of a consolidated
entity are remeasured into that entity’s functional currency resulting in exchange gains or losses recorded in other income (expense),
net.

Operating segments

Operating segments are defined as components of
an entity for which discrete financial information is available that is regularly reviewed by the Chief Operating Decision Maker (“CODM”)
in deciding how to allocate resources to an individual segment and in assessing performance. Our CODM is composed of the Chief Executive
Officer and Chief Financial Officer, who use segment gross profit (loss) to assess the performance of the business of our reportable operating
segments.

Income taxes

We account for current and deferred income taxes
in accordance with the authoritative guidance, which requires that the income tax impact is to be recognized in the period in which the
law is enacted. Current income tax expense represents taxes paid or payable for the current period. Deferred tax assets and liabilities
are recognized using enacted tax rates for the future tax impact of temporary differences between the financial statement and