Eightco (NASDAQ: ORBS) invests in OpenAI and builds major Worldcoin stake
Eightco Holdings Inc. reported a sharply higher quarterly loss as it pivoted heavily into digital assets and frontier tech investments. For the three months ended March 31, 2026, revenue from its Forever 8 inventory-funding business fell 23.7% to $7.6 million, reflecting canceled agreements and lower order volumes.
The company posted a net loss of $76.1 million, compared with $2.5 million a year earlier, largely driven by a $66.5 million loss from the change in fair value of its digital assets under new fair value accounting. As of March 31, 2026, digital assets totaled $175.3 million, including 277.2 million Worldcoin tokens with a cumulative unrealized loss of $243.8 million versus cost.
Eightco raised $165.4 million of net cash through at-the-market stock issuances but ended the quarter with $7.5 million of cash after deploying large sums into digital assets and other investments, including $92.6 million for an indirect OpenAI interest and $18.0 million in Beast Industries. Shares outstanding more than doubled year over year, and Forever 8 revenue remains highly concentrated in a single European customer, increasing both customer and foreign currency risk.
Positive
- None.
Negative
- Sharp deterioration in profitability: Net loss widened to $76.1M from $2.5M year over year, driven mainly by a $66.5M loss from the change in fair value of digital assets, signaling materially higher earnings volatility.
- High-risk capital allocation and dilution: The company deployed over $200M into Worldcoin and private frontier-tech investments while issuing 160.98M new shares via an ATM program, significantly diluting existing holders and tying value to volatile, illiquid assets.
Insights
Large digital-asset losses and dilution drive a much weaker profile.
Eightco has effectively transformed into a hybrid of a small operating business and a large digital-asset and venture-style investment vehicle. Q1 2026 revenue from Forever 8 slipped to $7.6M, while the business remains dependent on one major customer and European demand.
The headline issue is earnings volatility from the Digital Asset Treasury strategy. A $66.5M loss from the change in fair value of digital assets pushed net loss to $76.1M. Worldcoin exposure is substantial, with cost of $320.7M and fair value of $76.5M, creating a large cumulative unrealized loss.
To fund this strategy, the company issued 160.98M new shares via its ATM, lifting total shares outstanding to 368.96M as of March 31, 2026. It also committed significant capital to private investments, including $92.6M into an OpenAI SPV and $18.0M into Beast Industries. These moves increase balance-sheet scale but heighten risk, as returns now depend heavily on volatile digital assets and illiquid frontier-tech stakes rather than the underlying operating business.
Key Figures
Key Terms
Digital Asset Treasury Strategy financial
ASU 2023-08 financial
measurement alternative financial
fair value hierarchy financial
One Big Beautiful Bill Act financial
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For
the quarterly period ended
or
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ________ to ________
Commission
file number:
(Exact Name of Registrant as Specified in its Charter)
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| of Incorporation or Organization) | Identification No.) |
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(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| The
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or Section 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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| Large accelerated filer ☐ | Accelerated filer ☐ |
| Smaller
Reporting Company | |
| Emerging
Growth Company |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
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Yes
As
of May 15, 2026, there were
EIGHTCO HOLDINGS INC.
TABLE OF CONTENTS
| Page Number | ||
| PART I | 5 | |
| Item 1. | Financial Statements | 5 |
| Condensed Consolidated Balance Sheets as of March 31, 2026 (Unaudited) and December 31, 2025 | 5 | |
| Condensed Consolidated Statements of Operations for the three months ended March 31, 2026 and 2025 (Unaudited) | 6 | |
| Condensed Consolidated Statements of Comprehensive Loss for the three months ended March 31, 2026 and 2025 (Unaudited) | 7 | |
| Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2026 and 2025 (Unaudited) | 8 | |
| Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2026 and 2025 (Unaudited) | 9 | |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 27 |
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 34 |
| Item 4. | Controls and Procedures | 34 |
| PART II | 35 | |
| Item 1. | Legal Proceedings | 35 |
| Item 1A. | Risk Factors | 35 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 37 |
| Item 5. | Other Information | 37 |
| Item 6. | Exhibits | 37 |
| Signatures | 38 | |
| 2 |
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q for the period ended March 31, 2026 (the “Quarterly Report”) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements relate to future events including, without limitation, our ability to raise capital, our operational and strategic initiatives or our future financial performance. We have attempted to identify forward-looking statements by using terminology such as “anticipates,” “believes,” “expects,” “can,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predict,” “should” or “will” or the negative of these terms or other comparable terminology. These statements are only predictions; uncertainties and other factors may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels or activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Our expectations are as of the date this Quarterly Report is filed, and we do not intend to update any of the forward-looking statements after the date this Quarterly Report is filed to confirm these statements to actual results, unless required by law.
You should not place undue reliance on forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties, and actual results may differ materially from those in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed in “Risk Factors,” in Part II, Item 1A of this Report as well as information provided elsewhere in this Quarterly Report and our Annual Report on Form 10-K for the year ended December 31, 2025 (the “Annual Report”), which was filed with the Securities and Exchange Commission (the “SEC”) on April 15, 2026. You should carefully consider that information before you make an investment decision.
These and other factors discussed above could cause results to differ materially from those expressed in the estimates made by any independent parties and by us.
| 3 |
OTHER PERTINENT INFORMATION
Unless the context otherwise indicates, when used in this Quarterly Report, the terms “Eightco,” “we,” “us,” “our,” the “Company” and similar terms refer to Eightco Holdings Inc., a Texas corporation, and all of our consolidated subsidiaries and variable interest entities.
| 4 |
PART I - FINANCIAL INFORMATION
EIGHTCO HOLDINGS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
| March 31, | December 31, | |||||||
| 2026 | 2025 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Short-term investments | - | |||||||
| Digital assets, at fair value | ||||||||
| Accounts receivable, net | ||||||||
| Inventories, net | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Total current assets | ||||||||
| Property and equipment, net | - | |||||||
| Other investments | ||||||||
| Loan held-for-investment | ||||||||
| Total assets | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | $ | ||||||
| Accounts payable – related parties | ||||||||
| Accounts payable | ||||||||
| Accrued expenses and other current liabilities | ||||||||
| Accrued expenses and other current liabilities – related parties | ||||||||
| Accrued expenses and other current liabilities | ||||||||
| Line of credit | ||||||||
| Line of credit – related parties | ||||||||
| Line of credit | ||||||||
| Total current liabilities | ||||||||
| Total liabilities | $ | $ | ||||||
| Stockholders’ equity | ||||||||
| Preferred stock, $ | - | - | ||||||
| Common stock, $ | $ | $ | ||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Foreign currency translation | ||||||||
| Total stockholders’ equity attributable to Eightco Holdings Inc. | ||||||||
| Non-controlling interest | ( | ) | ( | ) | ||||
| Total stockholders’ equity | ||||||||
| Total liabilities and stockholders’ equity | $ | $ | ||||||
See the accompanying notes to the condensed consolidated financial statements.
| 5 |
EIGHTCO HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| 2026 | 2025 | |||||||
| For
the Three Months Ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Revenues, net | $ | $ | ||||||
| Cost of revenues | ||||||||
| Gross profit | ||||||||
| Operating expenses: | ||||||||
| Selling, general and administrative expenses | ||||||||
| Total operating expenses | ||||||||
| Operating loss | ( | ) | ( | ) | ||||
| Non-operating income (expense): | ||||||||
| Interest income (expense), net | ( | ) | ( | ) | ||||
| Change in fair value of digital assets | ( | ) | - | |||||
| Gains on disposal of short-term investments | - | |||||||
| Gain on extinguishment of liabilities | - | |||||||
| Other income | ||||||||
| Total non-operating income (expense) | ( | ) | ( | ) | ||||
| Net loss before income tax expense | ( | ) | ( | ) | ||||
| Income tax expense (benefit) | - | ( | ) | |||||
| Net loss from continuing operations | ( | ) | ( | ) | ||||
| Net income from discontinued operations, net of tax | - | |||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Net loss attributable to non-controlling interest | - | - | ||||||
| Net loss attributable to Eightco Holdings Inc. | $ | ( | ) | $ | ( | ) | ||
| Net loss per share: | ||||||||
| Net loss per share basic and diluted | $ | ( | ) | $ | ( | ) | ||
| Weighted average number of common shares outstanding – basic and diluted | ||||||||
See the accompanying notes to the condensed consolidated financial statements.
| 6 |
EIGHTCO HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Unaudited)
| 2026 | 2025 | |||||||
For the Three Months Ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Foreign currency translation – unrealized gain (loss) | ( | ) | ||||||
| Comprehensive loss | $ | ( | ) | $ | ( | ) | ||
See the accompanying notes to the condensed consolidated financial statements.
| 7 |
EIGHTCO HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)
| Shares | Amount | Capital | Interest | Deficit | Income | Total | ||||||||||||||||||||||
| Common Stock | Additional Paid in | Non controlling | Retained
Earnings (Accumulated) | Accumulated Other | ||||||||||||||||||||||||
| Shares | Amount | Capital | Interest | Deficit | Income | Total | ||||||||||||||||||||||
| Balances, January 1, 2026 | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||||
| Issuance of common stock - ATM | - | - | - | |||||||||||||||||||||||||
| Option to repurchase shares | - | - | ( | ) | - | - | - | ( | ) | |||||||||||||||||||
| Share-based compensation expense | - | - | - | |||||||||||||||||||||||||
| Foreign currency translation | - | - | - | - | - | ( | ) | ( | ) | |||||||||||||||||||
| Net loss for the three months ended March 31, 2026 | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||
| Balances, March 31, 2026 | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||||
| Balances, January 1, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||||
| Issuance of common stock to note holders – interest | ( | ) | - | - | - | - | ||||||||||||||||||||||
| Issuance of common stock to vendors for settlement of liabilities | - | - | - | |||||||||||||||||||||||||
| Foreign currency translation | - | - | - | - | - | |||||||||||||||||||||||
| Net loss for the three months ended March 31, 2025 | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||
| Net loss | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||
| Balances, March 31, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||||
See the accompanying notes to the condensed consolidated financial statements.
| 8 |
EIGHTCO HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Three Months Ended March 31, 2026 | For the Three Months Ended March 31, 2025 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income (loss) | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
| Depreciation and amortization – continuing operations | ||||||||
| Depreciation and amortization – discontinued operations | - | |||||||
| Amortization of debt issuance costs | - | |||||||
| Share-based compensation | - | |||||||
| Change in fair value of digital assets | - | |||||||
| Gain on disposal | ( | ) | - | |||||
| Losses on disposal | ||||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | ( | ) | ||||||
| Inventories | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Accounts payable | ( | ) | ||||||
| Accrued expenses and other current liabilities | ( | ) | ||||||
| Discontinued operations | - | ( | ) | |||||
| Net cash provided by (used in) operating activities | ( | ) | ||||||
| Cash flows from investing activities: | ||||||||
| Purchases of property and equipment – continuing operations | - | ( | ) | |||||
| Purchases of digital assets | ( | ) | - | |||||
| Purchases of short-term investments | ( | ) | - | |||||
| Purchase of other investments | ( | ) | ||||||
| Proceeds from sale of short-term investments | ||||||||
| Repayment of principal under loans held-for-investment | - | |||||||
| Purchases of property and equipment – discontinued operations | - | ( | ) | |||||
| Net cash used in investing activities | ( | ) | ( | ) | ||||
| Cash flows from financing activities: | ||||||||
| Net proceeds from issuance of common stock | - | |||||||
| Prepayment for share repurchase | ( | ) | - | |||||
| Net (repayments) borrowings under line of credit | ( | ) | ( | ) | ||||
| Repayments under convertible notes payable – related parties | ||||||||
| Net cash provided by (used in) financing activities | ( | ) | ||||||
| Net decrease in cash and cash equivalents | ( | ) | ||||||
| Cash and cash equivalents, beginning of the period | ||||||||
| Cash and cash equivalents, end of the period | $ | $ | ||||||
| Supplemental disclosure of cash flow information: | ||||||||
| Cash paid for interest | $ | $ | ||||||
| Cash paid for income taxes | $ | - | $ | - | ||||
| Accrued offering costs | $ | $ | - | |||||
| Issuance of common stock to vendors for settlement of liabilities | $ | - | $ | |||||
See the accompanying notes to the condensed consolidated financial statements.
| 9 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION
As used herein, “Eightco,” “we,” “us,” “our,” and the “Company” refer to Eightco Holdings Inc., a Texas corporation, and its consolidated subsidiaries. The Company was originally incorporated on September 21, 2021 under the laws of the State of Nevada and converted to a Delaware corporation on March 9, 2022 pursuant to a plan of conversion with its former parent, Vinco Ventures, Inc. (“Vinco” or the “Former Parent”). On February 2, 2026, we changed our state of domicile to the State of Texas.
Operating Structure and Recent Changes
Historically, the Company operated multiple business lines, including:
| ● | Forever 8 Inventory Cash Flow Solutions (“Forever 8”) | |
| ● | Corrugated Packaging Business, operated through Ferguson Containers, Inc. | |
| ● | Web3 operations, including BTC mining hardware sales and NFT development |
The Company has since exited its non-core operations. Forever 8 now represents the Company’s sole operating business.
Forever 8, acquired on October 1, 2022, provides inventory funding and purchasing services to e-commerce retailers and remains the Company’s core operating platform.
On April 7, 2025, the Company completed the sale of the assets comprising its Corrugated Packaging Business. All operations related to this business ceased as of that date. The Company previously completed its wind-down of Web3 and BTC mining hardware sales activities and does not intend to resume revenue-generating operations in that area.
Adoption of Digital Asset Treasury Strategy
On September 8, 2025, the Company’s Board of Directors approved a Digital Asset Treasury (“DAT”) Strategy under which the Company deploys a portion of its excess liquidity, operating cash flows, and capital from financing activities into digital assets as part of its long-term capital allocation framework.
Under this strategy, the Company holds various digital assets, including Worldcoin (WLD), Ethereum (ETH), and USD denominated stablecoins for treasury, liquidity management, and strategic investment purposes. The Company does not currently generate revenue from its digital asset holdings. Digital assets are custodied with institutional third-party providers, including Kraken, Coinbase, and FalconX.
The Company adopted ASU 2023-08 effective January 1, 2025. Eligible digital assets are measured at fair value with changes recognized in net income.
Strategic Investments in Frontier Technology Companies
In addition to its digital asset holdings, the Company deploys capital into strategic equity investments in privately-held frontier technology companies as part of its long-term capital allocation framework. The Company’s investment philosophy centers on sectors it believes are fundamental to the future of authentication, digital identity, and the AI-driven economy—including blockchain infrastructure, human verification, artificial intelligence platforms, and next-generation consumer distribution. These investments are intended to complement the Company’s digital asset treasury strategy and position the Company at the intersection of transformative technology platforms. See Note 10 — Other Investments for additional information.
Corporate Organization
As of March 31, 2026, Eightco had the following wholly-owned subsidiaries:
| ● | Forever 8 Fund LLC | |
| ● | Ferguson Containers, Inc. (inactive following divestiture) | |
| ● | BlockHiro, LLC | |
| ● | Orb Subsidiary One, LLC | |
| ● | AI Innovation Capital LLC |
Forever 8’s wholly owned foreign subsidiaries:
| ● | Forever 8 UK, Ltd. | |
| ● | Forever 8 Fund EU Holdings BV |
In
addition, the Company owns
Separation from Former Parent
On June 30, 2022, the Company completed its previously announced separation from Vinco (the “Separation”). Prior to the Separation, Vinco contributed the assets and legal entities comprising the Company’s historical businesses to Eightco. Following the Separation, the Company became an independent, publicly traded company.
| 10 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION (continued)
Basis of Presentation.
The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial reporting and with the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, the unaudited condensed financial statements included herein contain all adjustments necessary to present fairly the Company’s financial position and the results of its operations and cash flows for the interim periods presented. Such adjustments are of a normal recurring nature. The results of operations for the three months ended March 31, 2026 may not be indicative of results for the full year. These unaudited condensed financial statements should be read in conjunction with the audited financial statements and the notes to those statements for the year ended December 31, 2025 included in the Annual Report.
The Company is an emerging growth company as the term is used in The Jumpstart Our Business Startups Act, enacted on April 5, 2012 and has elected to comply with certain reduced public company reporting requirements.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of Estimates. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. The Company’s significant estimates used in these condensed consolidated financial statements include, but are not limited to, fair value of warrants, revenue recognition and the determination of the economic useful life of depreciable property and equipment. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company’s estimates and could cause actual results to differ from those estimates.
Business Combinations. For business combinations that meet the accounting definition of a business, the Company determines and allocates the purchase price of an acquired company to the tangible and intangible assets acquired, the liabilities assumed, and noncontrolling interest, if applicable, as of the date of acquisition at fair value. Fair value may be estimated using comparable market data, a discounted cash flow method, or a combination of the two. In the discounted cash flow method, estimated future cash flows are based on management’s expectations for the future. Revenues and costs of the acquired companies are included in the Company’s operating results from the date of acquisition. The Company uses its best estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed at the acquisition date, and these estimates and assumptions are inherently uncertain and subject to refinement during the measurement period not to exceed one year from the acquisition date. As a result, any adjustment identified subsequent to the measurement period is included in operating results in the period in which the amount is determined.
Discontinued Operations. A component of an entity that is disposed of by sale or abandonment is reported as discontinued operations if the transaction represents a strategic shift that will have a major effect on an entity’s operations and financial results. The results of discontinued operations are aggregated and presented separately in the Consolidated Statement of Operations. Assets and liabilities of the discontinued operations are aggregated and reported separately as assets and liabilities of discontinued operations in the Consolidated Balance Sheet, including the comparative prior year period. Cash flows are reflected as cash flows from discontinued operations within the Company’s Consolidated Statements of Cash Flows for each period presented.
Cash and Cash Equivalents. The Company considers all highly liquid, short-term investments with original maturities of three months or less when purchased to be cash equivalents.
Digital Assets. Digital assets primarily consist of cryptocurrencies and other crypto-tokens held for treasury, investment, or operational purposes. Effective January 1, 2025, the Company adopted ASU 2023-08, Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60). Under this guidance, eligible crypto assets are measured at fair value at each reporting date, with changes in fair value recognized in net income in the period in which they occur. Upon adoption, historical impairment-only accounting ceased. Digital assets are presented on the face of the condensed consolidated balance sheets as “Digital assets, at fair value.” Assets expected to be converted into cash or otherwise used to fund operations within twelve months are classified as current assets; all other digital assets are classified as noncurrent assets. The Company determines fair value using quoted prices in its principal market at the measurement time. Digital assets with quoted prices in active markets are classified as Level 1 in the fair value hierarchy. When observable market inputs other than quoted prices are used (such as certain wrapped tokens, restricted tokens, or stablecoins whose value is not derived solely from exchange-traded prices), such assets are classified as Level 2. The Company did not classify any digital assets as Level 3 during the periods presented. Realized and unrealized gains and losses from changes in the fair value of digital assets are recorded within “(Loss) income from change in fair value of digital assets” in the condensed consolidated statements of operations. Realized gains and losses on disposals are determined using the specific identification method. Digital assets are held with third-party custodians and institutional trading counterparties. These arrangements expose the Company to counterparty, concentration, and safeguarding risks, including technological, operational, and cyber-security risks. The Company does not hold digital assets on behalf of third parties and therefore does not apply the guidance in SAB 121. As of the periods presented, the Company does not stake, lend, or pledge its digital assets, and there are no digital-asset collateral or borrowing arrangements outstanding.
| 11 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Accounts
Receivable. Accounts receivable are carried at their contractual amounts, less an estimated allowance for credit losses. Management
estimates the allowance for credit losses using a loss-rate approach based on historical loss information, adjusted for management’s
expectations about current and future economic conditions, as the basis to determine expected credit losses. Management exercises significant
judgment in determining expected credit losses. Key inputs include macroeconomic factors, industry trends, the creditworthiness of counterparties,
historical experience, the financial conditions of the customers, and the amount and age of past due accounts. Management believes that
the composition of receivables at year-end is consistent with historical conditions as credit terms and practices and the client base
has not changed significantly. Receivables are considered past due if full payment is not received by the contractual due date. Past
due accounts are generally written off against the allowance for credit losses only after all collection attempts have been exhausted.
The allowance for credit losses was $
Inventories.
Inventory is recorded at the lower of cost or net realizable value on a first-in, first-out basis. The Company reduces the carrying value
of inventories for those items that are potentially excess, obsolete, or slow moving based on changes in customer demand, technology
developments, or other economic factors. The reserve for obsolescence was $
Other
Investments. Other investments are recorded at cost. Each
reporting period, the Company performs a qualitative impairment assessment for each investment accounted for under the measurement alternative.
Indicators of impairment include, but are not limited to, a significant deterioration in the earnings performance, credit rating, asset
quality, or business prospects of the investee; a significant adverse change in the regulatory, economic, or technological environment
of the investee; a significant adverse change in the general market condition of either the geographical area or the industry in which
the investee operates; a bona fide offer to purchase, an offer by the investee to sell, or a completed auction process for the same or
similar investment for an amount less than the carrying amount of the investment; and factors that raise significant concerns about the
investee’s ability to continue as a going concern. If a qualitative assessment indicates that the investment is impaired, the Company
estimates the fair value of the investment in accordance with ASC 820 and, if the fair value is less than the carrying amount, recognizes
an impairment loss in earnings equal to the difference between the carrying amount and fair value.
Property
and Equipment. Property and equipment are stated at cost, net of accumulated depreciation and amortization, which is recorded commencing
at the in-service date using the straight-line method over the estimated useful lives of the assets, as follows:
Contingent Liabilities. The Company, from time to time, may be involved in certain legal proceedings. Based upon consultation with outside counsel handling its defense in these matters and the Company’s analysis of potential 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 condensed 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 condensed 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 evaluates warrants and other freestanding instruments to determine whether they should be classified as equity or as assets or liabilities in the consolidated balance sheets. Warrants that are freestanding financial instruments and are indexed to the Company’s own stock and meet the criteria for equity classification are recorded in equity at issuance and are not subsequently remeasured. Warrants that do not meet the criteria for equity classification are recorded as assets or liabilities at fair value upon issuance and remeasured to fair value at each reporting date, with changes in fair value recognized in earnings.
| 12 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
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
Disaggregation of Revenue. The Company’s primary revenue stream includes the sale of consumer goods through its inventory management solutions business. The revenue stream for discontinued operations primarily includes the sale of corrugated packaging materials. There are no other material operations that were separately disaggregated for segment purposes.
Cost of Revenues. Cost of revenues includes freight charges, purchasing and receiving costs, depreciation and inspection costs.
Comprehensive
income. The Company follows Accounting Standards
Codification (“ASC”) 220 in reporting comprehensive income. Comprehensive income is a more inclusive financial reporting
methodology that includes disclosure of certain financial information that historically has not been recognized in the calculation of
net income. For the three months ended March 31, 2026 and 2025, the Company recognized other comprehensive gain (loss) for foreign currency
translation of $(
Foreign Currency Transactions and Translation. Eightco’s functional currency is the United States Dollar (“USD”) and the Forever 8 subsidiaries have functional currencies in Euro (“EUR”), British Pound Sterling (“GBP”), and USD.
For the purpose of presenting these condensed consolidated financial statements, the reporting currency is USD. Forever 8 assets and liabilities are expressed in USDs at the exchange rate on the balance sheet date, equity accounts are translated at historical rates, and income and expense items are translated at the weighted average exchange rate during the period. The resulting translation adjustments are reported under accumulated other comprehensive income in the stockholders’ equity section of the balance sheets.
| 13 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Transactions in currencies other than the entity’s functional currency are recorded at the rates of exchange prevailing on the date of the transaction. At the end of each reporting period, monetary items denominated in foreign currencies are translated at the rates prevailing at the end of the reporting periods. Exchange differences arising on the settlement of monetary items and on translation of monetary items at period-end are included in statement of comprehensive loss.
For
the three months ended March 31, 2026, approximately
Exchange rates used for the translations are as follows:
SCHEDULE OF EXCHANGE RATE
| March
31, 2026 | December
31, 2025 | |||||||
| Spot | ||||||||
| USD to EUR | $ | $ | ||||||
| USD to GBP | $ | $ | ||||||
| March
31, 2026 | March
31, 2025 | |||||||
| Average | ||||||||
| USD to EUR | $ | $ | ||||||
| USD to GBP | $ | $ | ||||||
Earnings Per Share. The Company follows ASC 260 when reporting Earnings Per Share (“EPS”) resulting in the presentation of basic and diluted earnings per share. Basic net (loss) income per common share is computed by dividing net (loss) income by the weighted average number of vested common shares outstanding during the period. Diluted net income per common share is computed by dividing net income by the weighted average number vested of common shares, plus the net impact of common shares (computed using the treasury stock method), if dilutive, resulting from the exercise of dilutive securities. In periods when losses are reported, the weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.
As of March 31, 2026 and December 31, 2025, the Company excluded the common stock equivalents summarized below, which entitle the holders thereof to ultimately acquire shares of common stock, from its calculation of earnings per share, as their effect would have been anti-dilutive.
SCHEDULE OF EARNINGS PER SHARE COMMON STOCK EQUIVALENTS ANTI DILUTIVE
March 31, 2026 | December 31, 2025 | |||||||
| Options | ||||||||
| Restricted stock units | - | |||||||
| Warrants | ||||||||
| Pre-funded warrants | ||||||||
| Shares to be issued | - | |||||||
| Total common stock equivalents | ||||||||
| 14 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Deferred Financing Costs. Deferred financing costs include debt discounts and debt issuance costs related to a recognized debt liability and are presented in the balance sheet as a direct deduction from the carrying value of the debt liability. Amortization of deferred financing costs is included as a component of interest expense. Deferred financing costs are amortized using the straight-line method over the term of the recognized debt liability which approximates the effective interest method.
Income Taxes. The Company accounts for income taxes under the provisions of the FASB ASC Topic 740 “Income Taxes” (“ASC Topic 740”). The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of items that have been included or excluded in the condensed consolidated financial statements or tax returns. Deferred tax assets and liabilities are determined on the basis of the difference between the tax basis of assets and liabilities and their respective financial reporting amounts (“temporary differences”) at enacted tax rates in effect for the years in which the temporary differences are expected to reverse. The Company utilizes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Management has evaluated and concluded that there were no material uncertain tax positions requiring recognition in the Company’s condensed consolidated financial statements as of March 31, 2026. The Company does not expect any significant changes in its unrecognized tax benefits within twelve months of the reporting date. The Company’s policy is to classify assessments, if any, for tax related interest as interest expense and penalties as general and administrative expenses in the consolidated statements of comprehensive income. The Company is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress.
Fair Value Measurements. The Company measures the fair value of financial assets and liabilities based on the guidance of ASC 820 “Fair Value Measurements and Disclosures” (“ASC 820”) which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements.
ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:
Level 1 — quoted prices in active markets for identical assets or liabilities
Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable
Level 3 — inputs that are unobservable (for example, cash flow modeling inputs based on assumptions)
Effective January 1, 2025, the Company adopted ASU 2023-08, which requires eligible digital assets to be measured at fair value, with changes in fair value recognized in earnings each reporting period. Digital assets that trade in active markets and have readily determinable fair values, including Worldcoin (WLD), Ethereum (ETH), and U.S. dollar-denominated stablecoins, are classified within Level 1 of the fair value hierarchy. Digital assets are valued based on quoted market prices obtained from principal market exchanges where the assets are actively traded.
The Company’s financial instruments that are not measured at fair value, including cash, accounts receivable, accounts payable, accrued expenses, and short-term borrowings, approximate fair value due to their short-term maturities.
No transfers between Level 1, Level 2, or Level 3 occurred during the periods presented.
Concentration
of Credit Risks. Financial instruments that potentially subject the Company to concentrations of credit risk are cash equivalents,
digital assets, and accounts receivable. The Company maintains cash balances and digital asset custodial accounts with multiple institutional-grade
financial institutions and digital asset custodians, including Kraken, FalconX, and Coinbase. Balances held with digital asset custodians
are not federally insured. Balances held with institutional-grade financial institutions may exceed federally insured limits or similar
protections. The Company manages custodial risk through the use of multiple counterparties, ongoing evaluation of each custodian’s
financial stability, and review of their security and safekeeping practices. The Company has not experienced any losses on deposits or
digital asset holdings. With respect to trade receivables, the Company performs ongoing evaluations of customer credit worthiness and
does not require collateral. As of March 31, 2026, two customers represented approximately
| 15 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Recently Issued Accounting Pronouncements Not Yet Adopted. In November 2024, the FASB issued ASU 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses,” which requires the disaggregated disclosure of specific expense categories, including purchases of inventory, employee compensation, depreciation, and amortization included in each relevant expense caption presented on the statement of operations. The standard also requires disclosure of qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, as well as the total amount of selling expenses and an entity’s definition of selling expenses. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. The Company is currently evaluating the impact this standard will have on its consolidated financial statements.
The Company currently believes there are no other issued and not yet effective accounting standards that are materially relevant to its consolidated financial statements.
Segment
Reporting. The Company uses “the management
approach” in determining reportable operating segments. The management approach considers the internal organization and reporting
used by the Company’s chief operating decision maker for making operating decisions and assessing performance as the source for
determining the Company’s reportable segments. The Company’s chief operating decision maker is the Chairman and Chief Executive
Officer (“CEO”) of the Company, who reviews operating results to make decisions about allocating resources and assessing
performance for the entire Company. As of March 31, 2026, the Company operates as
3. SHORT-TERM INVESTMENTS
Short-term investments consist of the following at March 31, 2026 and December 31, 2025:
SCHEDULE OF SHORT-TERM INVESTEMNTS
| March
31, 2026 |
December 31, 2025 |
|||||||
| Government securities | $ | $ | - | |||||
| Mutual funds | - | |||||||
| Total short-term investments | $ | $ | - | |||||
| 16 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
4. RESTRUCTURING AND SEVERANCE
The changes in the carrying amount of restructuring and severance liabilities for the period from January 1, 2026 through March 31, 2026 consisted of the following:
SCHEDULE OF CHANGES IN RESTRUCTURING AND SEVERANCE LIABILITIES
| Balance, January 1, 2026 | $ | |||
| Additions and adjustments | - | |||
| Payments and adjustments | ( | ) | ||
| Balance, March 31, 2026 | $ |
5. DIGITAL ASSETS
Digital assets consist of the following at March 31, 2026:
SCHEDULE OF DIGITAL ASSETS
| March 31, 2026 | ||||||||
| Quantity | Fair Value (USD) | |||||||
| Worldcoin (WLD) – Level 1 | $ | |||||||
| Ethereum (ETH) – Level 1 | ||||||||
| Stablecoins (USDC, USDT) – Level 1 | ||||||||
| Total digital assets, at fair value | $ | |||||||
Digital assets consist of the following at December 31, 2025:
| December 31, 2025 | ||||||||
| Quantity | Fair Value (USD) | |||||||
| Worldcoin (WLD) – Level 1 | $ | |||||||
| Ethereum (ETH) – Level 1 | ||||||||
| Stablecoins (USDC, USDT) – Level 1 | ||||||||
| Total digital assets, at fair value | $ | |||||||
The Company’s digital assets are held with third-party custodians and institutional trading counterparties. These arrangements expose the Company to counterparty, concentration, and safeguarding risks, including technological, operational, and cybersecurity risks. The Company does not hold digital assets on behalf of third parties.
The changes in the carrying amount of digital assets for the period from January 1, 2026 through March 31, 2026 consisted of the following:
SCHEDULE OF CHANGES IN THE CARRYING AMOUNT OF DIGITAL ASSETS
| For the three months ended March 31, 2026 | ||||
| Beginning balance, December 31, 2025 | $ | |||
| Purchases of digital assets | ||||
| Realized/unrealized gains (losses) | ( | ) | ||
| Sales of digital assets | - | |||
| $ | ||||
The following table presents the Company’s digital asset holdings by token, including cost basis, fair value, and unrealized gains (losses) as of March 31, 2026:
SCHEDULE OF DIGITAL ASSET HOLDINGS
| Cost Basis | Fair Value | Unrealized Gain (Loss) | ||||||||||
| Token: | ||||||||||||
| WLD | $ | $ | $ | ( | ) | |||||||
| ETH | ||||||||||||
| USDC / USDT | - | |||||||||||
| Total | ( | ) | ||||||||||
Unrealized gains (losses) represent the difference between the original cost basis and the fair value of each token as of the balance sheet date, based on the closing market price of each respective digital asset.
| 17 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
6. ACCOUNTS RECEIVABLE
Accounts receivable consist of the following at March 31, 2026 and December 31, 2025:
SCHEDULE OF ACCOUNTS RECEIVABLE
March 31, 2026 | December 31, 2025 | |||||||
| Trade accounts receivable | $ | $ | ||||||
| Less: allowance for credit losses | ( | ) | ( | ) | ||||
| Total accounts receivable | $ | $ | ||||||
7. INVENTORIES
Inventories consist of the following at March 31, 2026 and December 31, 2025:
SCHEDULE OF INVENTORIES
March 31, 2026 | December 31, 2025 | |||||||
| Finished goods | $ | $ | ||||||
| Reserve for obsolescence | ( | ) | ( | ) | ||||
| Total inventories | $ | $ | ||||||
8. PREPAID EXPENSES AND OTHER CURRENT ASSETS
Other current assets consist of the following at March 31, 2026 and December 31, 2025:
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS
| March 31, 2026 | December 31, 2025 | |||||||
| Deposits on inventory | $ | $ | ||||||
| Prepaid insurance | ||||||||
| Deposits | ||||||||
| Other | ||||||||
| Total other current assets | $ | $ | ||||||
9. LOAN HELD-FOR-INVESTMENT
Loan held-for-investment consist of the following at March 31, 2026 and December 31, 2025:
SCHEDULE OF LOAN HELD FOR INVESTMENT
| March 31, 2026 | December 31, 2025 | |||||||
| Wattum Management Inc. –
| $ | $ | ||||||
| Reichard Containers, LLC
– | ||||||||
| Total loan held-for-investment | ||||||||
| Less: allowance for credit losses | - | - | ||||||
| Loan held-for-investment | $ | $ | ||||||
Wattum Management Inc. is a non-controlling member of CW Machines, LLC, previously a related party, when CW Machines was doing business. The Wattum note is secured by assets of Wattum Management, Inc. The Wattum Management Inc. note is interest only with the entire principal balance due in October 2026.
Reichard
Containers, LLC purchased the assets of Ferguson Containers, Inc. on April 7, 2025. The Reichard note is secured by assets of Reichard
Containers, LLC. The Reichard note is due on April 2035 and with monthly payments of $
Expected credit losses for loan held for investment are based on management’s assessment of credit risk associated with the loan, including consideration of factors such as the financial condition of the entity, historical payment behavior, and any collateral or guarantees provided. The Company determined it was not necessary to record an allowance for credit losses as of March 31, 2026 and December 31, 2025.
| 18 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
10. OTHER INVESTMENTS
Other investments consist of the Company’s minority equity investments in privately-held companies, accounted for under the measurement alternative. The following table summarizes the carrying value of these investments as of March 31, 2026 and December 31, 2025:
SCHEDULE OF OTHER INVESTMENTS
| March 31, 2026 | December 31, 2025 | |||||||
| Mythical Games, Inc. | $ | $ | ||||||
| Beast Industries | - | |||||||
| OpenAI (indirect investment) | - | |||||||
| Total other investments | $ | $ | ||||||
Mythical Games, Inc.
In
October 2025, the Company invested $
Beast Industries
During
the three months ended March 31, 2026, the Company acquired a minority equity interest in Beast Industries, a privately-held
company, for total cash consideration of $
OpenAI
During
the three months ended March 31, 2026, the Company acquired an indirect interest in OpenAI through a structured investment vehicle (the
“SPV”) sponsored by an unaffiliated third party, for total cash consideration of $
The
Company’s interest in the SPV does not have a readily determinable fair value and is accounted for using the measurement alternative
under ASC 321, pursuant to which the investment is recorded at cost, less any impairment, and adjusted for observable price changes in
orderly transactions for identical or similar investments. As of March 31, 2026, the carrying value of the investment was $
11. PROPERTY AND EQUIPMENT, NET
Property and equipment consist of the following at March 31, 2026 and December 31, 2025:
SCHEDULE OF PROPERTY AND EQUIPMENT
March 31, 2026 | December 31, 2025 | |||||||
| Furniture and fixtures | $ | $ | ||||||
| Property plant and equipment, gross | ||||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| Total property and equipment, net | $ | - | $ | |||||
For
the three months ended March 31, 2026 and 2025, depreciation expense was $
| 19 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
12. INTANGIBLE ASSETS, NET
Intangible assets consist of the following at March 31, 2026 and December 31, 2025:
SCHEDULE OF INTANGIBLE ASSETS
| Useful Lives | March 31, 2026 | December 31, 2025 | ||||||||
| Customer relationships | $ | - | $ | |||||||
| Developed technology | - | |||||||||
| Trademarks and tradenames | - | |||||||||
| Total intangible assets, gross | - | |||||||||
| Less: accumulated amortization and impairments | - | ( | ) | |||||||
| Total intangible assets, net | $ | - | $ | - | ||||||
Amortization
expense was $
13. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Accrued expenses and other current liabilities consist of the following at March 31, 2026 and December 31, 2025:
SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
March 31, 2026 | December 31, 2025 | |||||||
| Payroll and related benefits | $ | $ | ||||||
| Professional fees | ||||||||
| Accrued offering costs | - | |||||||
| Accrued interest | - | |||||||
| Accrued rent | - | |||||||
| Accrued other taxes | - | |||||||
| Other | ||||||||
| Total accrued expenses and other current liabilities | $ | $ | ||||||
14. LINES OF CREDIT
Principal due under the lines of credit was as follows at March 31, 2026 and December 31, 2025:
SCHEDULE OF LINE OF CREDIT
March 31, 2026 | December 31, 2025 | |||||||
| Lines of credit, | $ | $ | ||||||
For
the three months ended March 31, 2026 and 2025, interest expense under lines of credit was $
The lines of credit are collateralized by the inventory of the Company.
15. LINES OF CREDIT – RELATED PARTIES
Principal due under the lines of credit – related parties was as follows at March 31, 2026 and December 31, 2025:
SCHEDULE OF LINE OF CREDIT - RELATED PARTIES
March 31, 2026 | December 31, 2025 | |||||||
| Lines of credit, | $ | $ | ||||||
For
the three months ended March 31, 2026 and 2025, interest expense under lines of credit – related parties was $
The lines of credit – related parties are collateralized by the inventory of the Company.
| 20 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
16. CONVERTIBLE NOTES PAYABLE – RELATED PARTIES
The
convertible notes payable, related party were issued as part of consideration for the acquisition of Forever 8. The debt discount was
calculated based on the fair value of the instrument as of October 1, 2022. On September 9, 2025, the Company recognized a capital contribution
in additional paid-in capital of $
For
the three months ended March 31, 2026, the Company recognized
17. INCOME TAXES
Eightco Holdings Inc. is taxed as a corporation and pays corporate federal, state and local taxes on income.
Forever
8 Fund, LLC, BlockHiro, LLC, Cryptyde Shared Services, LLC, Orb Subsidiary One, LLC, and AI Innovation Capital LLC are limited liability companies which are disregarded
entities for income tax purposes and are owned
CW
Machines, LLC is a limited liability company for income tax purposes and is owned
Ferguson Containers is taxed as a corporation and pays corporate federal, state and local taxes on income.
Forever 8 UK Ltd. is taxed as a corporation and pays foreign taxes on income.
F8 Fund EU Holdings BV is taxed as a corporation and pays foreign taxes on income.
For
the three months ended March 31, 2026 and 2025, income tax (benefit) expense was $0 and $(
There
are
The Company files U.S. income tax returns and a state income tax return. With few exceptions, the U.S. and state income tax returns filed for the tax years ending on December 31, 2021 and thereafter are subject to examination by the relevant taxing authorities.
As
of March 31, 2026, the Company had a net operating loss carryforward for federal income
tax purposes of approximately $
On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted, which includes significant amendments to the Internal Revenue Code. Key provisions include:
| ● | Limitations on the deductibility of certain interest and R&D expenses; | |
| ● | Modifications to the foreign-derived intangible income (“FDII “) and global intangible low-taxed income (“GILTI”) regimes. |
The Company evaluated the impact of the legislation on its consolidated financial statements, including deferred tax assets and liabilities, and incorporated the effects of the enacted changes in these condensed consolidated financial statements for the period ended March 31, 2026, consistent with ASC 740-10-45-15. The Company continues to evaluate the impact of the OBBBA on its effective tax rate in future periods.
| 21 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
18. STOCKHOLDERS’ EQUITY
Common Stock
The
Company is authorized to issue
Preferred Stock
As
of March 31, 2026 and December 31, 2025, the Company had
Common stock issuances during the three months ended March 31, 2026:
On
January 5, 2026, the Company issued
On
March 12, 2026, the Company granted stock options to directors, officers and employees to purchase an aggregate of
On
March 25, 2026, the Company released
During
the three months ended March 31, 2026, the Company sold
| 22 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
18. STOCKHOLDERS’ EQUITY (continued)
On
March 12, 2026, the Company’s Board authorized an increase of
Equity Awards and Share-Based Compensation
The grant-date fair value of equity-classified awards is recognized as compensation expense on a straight-line basis
over the requisite service period of each award, with forfeitures recognized as they occur. The fair value of stock options is estimated
using the Black-Scholes option-pricing model; the fair value of restricted stock and restricted stock units is based on the closing market
price of the Company’s common stock on the grant date. For the three months ended March 31, 2026, the Company used the following weighted-average
assumptions in the Black-Scholes model for options granted: expected term of
Summary of Outstanding Warrants
SCHEDULE OF OUTSTANDING WARRANTS AND STOCK OPTION
Number Outstanding | Exercisable | Weighted Average Remaining Term | Classification | |||||||||||
| Instrument: | ||||||||||||||
| Strategic Advisor Warrants | Equity | |||||||||||||
| Placement Agent Warrants | Equity | |||||||||||||
| Pre-Funded Warrants | n/a | Equity | ||||||||||||
| Total outstanding | ||||||||||||||
The strategic advisor and placement agent warrant awards were issued as inducement grants, outside of the Company’s equity incentive plan.
The changes in the warrant activity for the period from January 1, 2026 through March 31, 2026 consisted of the following:
SCHEDULE OF CHANGES IN WARRANT ACTIVITY
| Number of Warrants | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Term | Aggregate Intrinsic Value | |||||||||||||
| Outstanding, January 1, 2026 | $ | |||||||||||||||
| Granted | - | - | - | - | ||||||||||||
| Exercised | - | - | - | - | ||||||||||||
| Forfeited / Expired | - | - | - | - | ||||||||||||
| Outstanding, March 31, 2026 | $ | $ | ||||||||||||||
| Exercisable, March 31, 2026 | $ | $ | ||||||||||||||
| Vested and expected to vest, March 31, 2026 | $ | $ | ||||||||||||||
The aggregate intrinsic value as of March 31, 2026
is $
A summary of the status of nonvested warrants subject to service-based vesting conditions as of and for the three months ended March 31, 2026 is presented below:
SCHEDULE OF NONVESTED WARRANTS SUBJECT TO SERVICE-BASED VESTING CONDITIONS
| Warrant Activity | ||||||||
| Number of Units | Weighted-Average Grant-Date Fair Value | |||||||
| Nonvested, January 1, 2026 | $ | |||||||
| Granted | - | - | ||||||
| Vested | ( |
) | ( |
) | ||||
| Forfeited | - | - | ||||||
| Nonvested, March 31, 2026 | - | $ | - | |||||
Summary of Outstanding Options
| 23 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
18. STOCKHOLDERS’ EQUITY (continued)
The changes in the stock option activity for the period from January 1, 2026 through March 31, 2026 consisted of the following:
SCHEDULE OF CHANGES IN STOCK OPTION
Number of Options | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Term | Aggregate Intrinsic Value | |||||||||||||
| Outstanding, January 1, 2026 | - | $ | - | - | - | |||||||||||
| Granted | - | |||||||||||||||
| Exercised | - | - | - | - | ||||||||||||
| Forfeited / Expired | - | - | - | - | ||||||||||||
| Outstanding, March 31, 2026 | $ | $ | - | |||||||||||||
| Exercisable, March 31, 2026 | - | $ | - | - | $ | - | ||||||||||
| Vested and expected to vest, March 31, 2026 | $ | $ | - | |||||||||||||
A summary of the status of nonvested stock options as of and for the three months ended March 31, 2026 is presented below:
SCHEDULE OF NON-VESTED STOCK UNIT ACTIVITY
| Stock Option Activity | ||||||||
| Number of Units | Weighted-Average Grant-Date Fair Value | |||||||
| Nonvested, January 1, 2026 | - | $ | - | |||||
| Granted | ||||||||
| Vested | - | - | ||||||
| Forfeited | - | - | ||||||
| Nonvested, March 31, 2026 | $ | |||||||
Summary of Outstanding Restricted Stock and Restricted Stock Units
The Company did not have any outstanding restricted stock and restricted stock units as of March 31, 2026.
A summary of the status of nonvested restricted stock units as of and for the three months ended March 31, 2026 is presented below:
SCHEDULE OF RESTRICTED STOCK UNIT ACTIVITY
| Restricted Stock Unit Activity | ||||||||
| Number of Units | Weighted-Average Grant-Date Fair Value | |||||||
| Nonvested, January 1, 2026 | $ | |||||||
| Granted | - | - | ||||||
| Vested | ( | ) | ||||||
| Forfeited | - | - | ||||||
| Nonvested, March 31, 2026 | - | $ | - | |||||
The
Company issued the
Share-based
compensation expense recognized for the three months ended March 31, 2026 was $
SCHEDULE OF DISAGGREGATED BREAKDOWN OF STOCK COMPENSATION EXPENSE
| Fair Value | Prior Expensed | For the Three Months Ended March 31, 2026 | Unrecognized Expense | |||||||||||||
| Instrument: | ||||||||||||||||
| Strategic Advisor Warrants | $ | $ | $ | $ | - | |||||||||||
| Restricted Stock | - | |||||||||||||||
| Stock Options – Former Chairman of Board | ( | ) | - | |||||||||||||
| Restricted Stock Units | - | |||||||||||||||
| Stock Issuance | - | - | ||||||||||||||
| Stock Options | - | |||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
| 24 |
EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
19. COMMITMENTS AND CONTINGENCIES
Operating Leases. The Company leases certain office space from an entity affiliated through common ownership under an operating lease agreement on a month-to-month basis. The Company has elected not to recognize right-of-use assets and lease liabilities arising from short-term leases.
For
the three months ended March 31, 2026 and 2025, rent expense was $
Consulting Agreement. On September 9, 2025, the Company entered into a consulting agreement with Worldcoin Tower LLC to support the Company’s digital asset treasury strategy. Fees include:
| ● | 1%
of AUM up to $ | |
| ● | 0.5%
of AUM between $ | |
| ● | 0.25%
of AUM above $ | |
| ● | Milestone
payments based on treasury AUM exceeding $ | |
| ● | A
$ |
The
agreement has a five-year initial term with automatic five-year renewal. No equity awards were issued under this agreement. Consulting
expense for the three months ended March 31, 2026 was $
Master
Loan Agreement. On September 7, 2025, ORB Subsidiary One LLC, a wholly-owned subsidiary of the Company, entered into a Master Loan
Agreement providing up to $
Employment Agreements
On September 8, 2025, the Company entered into new employment agreements with its Chief Executive Officer, Kevin O’Donnell, and its Chief Financial Officer, Brett Vroman (together, the “Executives”). The agreements provide for one-year terms with an option for the Company to renew each agreement for an additional one-year term.
Chief Executive Officer – Kevin O’Donnell
Under
his agreement, Mr. O’Donnell will receive an annualized base salary of $
Subject
to Board approval, Mr. O’Donnell will also receive
Chief Financial Officer – Brett Vroman
Under
his agreement, Mr. Vroman will receive an annualized base salary of $
On September 9, 2025, the Company entered into Board of Directors Agreements (the “Director Agreements”) with three existing directors: Louis Foreman, Nic Caiano, and Frank Jennings (collectively, the “Directors”). The Director Agreements establish the terms of service, compensation, indemnification, and other obligations applicable to each Director. The agreements became effective on each Director’s respective appointment date. Under the Director Agreements, each Director:
| ● | Entitled
to an annual cash retainer of $ | |
| ● | Eligible
to receive equity compensation valued at up to $ | |
| ● | Eligible for discretionary bonuses in cash or equity at the Company’s sole discretion. No discretionary bonuses were granted to the Directors for the year ended December 31, 2025. | |
| ● | Is entitled to reimbursement for reasonable business expenses and will receive full indemnification, along with coverage under the Company’s directors’ and officers’ liability insurance program. |
The Director Agreements also require each Director to comply with confidentiality obligations, fiduciary duties, conflict-of-interest restrictions, and certain termination-related provisions, including automatic resignation from officer positions upon separation.
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EIGHTCO HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
20. SEGMENT REPORTING
The Company follows ASC 280, Segment Reporting, and determines its reportable segments based on the internal financial information reviewed by the Chief Executive Officer, who serves as the Company’s Chief Operating Decision Maker (“CODM”). The CODM evaluates the business on a consolidated basis for purposes of assessing performance, making operating decisions, allocating resources, and planning for future periods.
Historically,
the Company operated
On September 8, 2025, the Company initiated digital asset treasury management activities (“DAT Strategy”) as part of its broader corporate strategy to diversify its cash and liquidity management. These digital asset activities do not constitute a separate operating segment under ASC 280 because:
| ● | They are not managed as a distinct business unit. |
| ● | No discrete financial information is prepared or reviewed by the CODM for purposes of performance assessment. |
| ● | The CODM reviews digital asset activity only as part of consolidated corporate treasury management. |
Accordingly, digital asset treasury management activities are included within Corporate and do not represent a separate operating or reportable segment.
The Company therefore reports as one operating and reportable segment:
| ● | Forever 8 (Inventory Management Solutions) — the Company’s sole revenue-generating business. |
Corporate-level functions consisting primarily of centralized finance, treasury (including DAT-related activities), stock-based compensation, board costs, public company costs, interest expense, income taxes, and other non-operating items are not allocated to the Forever 8 segment. The CODM reviews Forever 8 working capital and operating assets to assess performance. Corporate assets include digital asset holdings, cash not used in Forever 8, goodwill, and other long-term corporate assets, none of which are allocated to operating segments. Segment assets reviewed by the CODM primarily include working capital assets for the Company’s operating business. Digital asset balances are monitored as part of corporate treasury and are not allocated to a segment.
The Company had no intersegment revenues during the periods presented. Segment information is presented in accordance with the manner in which the CODM internally evaluates operating performance and allocates resources.
21. SUBSEQUENT EVENTS
ATM Issuances – Cantor Fitzgerald & Co.
Subsequent
to March 31, 2026, and through May 15, 2026, the Company issued an aggregate of
Amended and Restated Consulting Agreement
On
May 1, 2026, the Company entered into an Amended and Restated Consulting Agreement (the “A&R DACA”) with Worldcoin
Tower LLC (the “Consultant”), which amends and restates in its entirety the Consulting Agreement dated as of September
9, 2025, between the Company and the Consultant (the “Original DACA”). Pursuant to the A&R DACA, the Consultant will
continue to provide consulting services with respect to the Company’s digital asset treasury strategy and expands the scope of
the Consultant’s engagement to a broader “Strategic Asset Strategy” consisting of two components: (1) the Digital
Asset Treasury Strategy, which remains focused on accumulating digital assets, and (2) a new Strategic Investment Strategy, which is
focused on deploying capital to invest in emerging companies. The A&R DACA also updates the applicable fee structure, whereby
the Company will pay the Consultant a consulting fee equal to
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Unless otherwise indicated, the terms “we,” “us,” “our,” “Eightco,” and the “Company” refer to Eightco Holdings Inc. together with its consolidated subsidiaries. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q.
This section contains forward-looking statements within the meaning of the federal securities laws, including statements regarding our strategy, plans, future financial performance, liquidity, and capital allocation framework. These statements involve risks, uncertainties, and assumptions that could cause actual results to differ materially from those expressed or implied in the forward-looking statements. Important factors that could cause such differences are discussed under the section titled “Cautionary Note Regarding Forward-Looking Statements” in this Quarterly Report, as well as under “Risk Factors” in this Quarterly Report and in our most recent Annual Report on Form 10-K. We undertake no obligation to update any forward-looking statements except as required by law.
Overview
Eightco Holdings Inc. (NASDAQ: ORBS) is building the authentication and trust layer for the post-AGI world. Through a first-of-its-kind Worldcoin digital asset treasury strategy and a portfolio of strategic investments in frontier technology companies, the Company is establishing a universal foundation for digital identity and Proof of Human (PoH) verification. The Company’s mission is organized around three core pillars: consumer authentication, enterprise authentication, and gaming authentication.
The Company also operates Forever 8, an e-commerce inventory solutions business acquired in October 2022, which represents its sole revenue-generating operating segment.
Our corporate headquarters are located in Easton, Pennsylvania, and our common stock is listed on the Nasdaq Capital Market under the symbol “ORBS.”
Forever 8
Forever 8 provides funding solutions and inventory management services for e-commerce businesses, enabling sellers to maintain optimal stock levels without tying up their own capital. Forever 8 is the Company’s sole operating segment and primary source of revenue. For the fiscal years ended December 31, 2025 and 2024, Forever 8 generated revenues of $32,981,126 and $39,621,272, respectively. Forever 8’s revenue base is highly concentrated, with one customer representing approximately 89% and 75% of total revenues for the fiscal years ended December 31, 2025 and 2024, respectively.
Adoption of Digital Asset Treasury (“DAT”) Strategy
Strategy Overview
On September 8, 2025, our Board of Directors approved the adoption of a Digital Asset Treasury Strategy under which Eightco holds digital assets, primarily Worldcoin (WLD), as part of a long-term treasury reserve framework. Under this policy, we may allocate excess liquidity, operating cash flows, and proceeds from financing transactions to the acquisition of digital assets.
This strategy reflects a dual-pillar model combining (i) the operating performance of Forever 8, and (ii) long-term digital asset holdings designed to enhance our capital base and provide shareholders with exposure to emerging decentralized technologies.
Rationale for Strategy
Key factors underlying the DAT Strategy include:
| ● | The growth and potential of the Worldcoin ecosystem | |
| ● | The belief that certain digital assets may serve as long-term stores of value | |
| ● | The ability to report digital assets at fair value under ASU 2023-08 | |
| ● | Opportunities for differentiated long-term returns | |
| ● | The availability of capital to scale a treasury strategy of meaningful size | |
| ● | Management expects digital assets to remain a significant component of our long-term capital allocation framework. |
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Capital Raising Activities
During the quarter ended March 31, 2026, we completed substantial financing transactions to support the DAT Strategy:
| ● | We generated additional proceeds through our at-the-market (“ATM”) equity offering program. |
A significant portion of the ATM proceeds were deployed to acquire digital assets and invest in strategic investments. These capital raises materially strengthened our liquidity and expanded our balance sheet.
Digital Asset Acquisitions
Our holdings consist primarily of:
| ● | Worldcoin (WLD) | |
| ● | Ethereum (ETH) |
| ● | U.S. dollar-denominated stablecoins |
| ● | Other digital assets used for liquidity management, trade settlement, or operational purposes |
Digital assets are custodied with institutional-grade providers, including Kraken, Coinbase, and FalconX.
Custody, Concentrations and Transfer Restrictions
As of March 31, 2026, substantially all digital assets were held with a small number of U.S.-based institutional custodians under cold-storage arrangements. From time to time, a significant portion of our digital assets may be concentrated with a single custodian. Certain assets (including staking-ineligible or restricted tokens, if any) may be subject to withdrawal, settlement, or transfer restrictions pursuant to platform or network constraints. We continually evaluate custodian concentration and portability risk as part of our liquidity planning.
Accounting for Digital Assets
Effective January 1, 2025, we adopted ASU 2023-08, which requires eligible digital assets 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) 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.
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Critical Accounting Policies and Significant Judgments and Estimates
There were no material changes to our critical accounting policies during the three months ended March 31, 2026, 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, 2025.
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, general and administrative expenses include selling and marketing costs, payroll and employee-related expenses, administrative expenses, professional fees, insurance, technology and software costs, and other overhead required to support both our Forever 8 operations and our corporate infrastructure. SG&A also includes expenses associated with supporting the Digital Asset Treasury function, including custodial fees, compliance costs, and professional services related to digital asset oversight.
Restructuring and Severance Expenses
Restructuring and severance expenses consist of costs associated with organizational changes, including employee severance, benefits continuation, contract termination costs, and costs associated with facility consolidations or other restructuring activities. These expenses vary depending on management’s strategic initiatives. No restructuring or severance costs were incurred during the periods presented.
Interest Expense and Income, Net
Interest expense reflects the cost of borrowings under our lines of credit and other financing arrangements used to support our Forever 8 inventory-financing activities. Interest income primarily includes earned interest on notes receivable and cash-equivalent investments, as well as yield earned on short-term instruments.
Change in Fair Value of Digital Assets
Beginning in September 2025, following the deployment of our Digital Asset Treasury strategy, the Company holds digital assets measured at fair value in accordance with ASU 2023-08. Changes in the fair value of digital assets including both realized and unrealized gains and losses are recognized in earnings in the period in which they occur. Because the DAT is not a revenue-generating activity, changes in fair value represent a key driver of period-over-period volatility in our results of operations.
Gain on Divestiture
Gain on divestiture represents gains recognized in connection with the sale of assets. This includes the gain recognized on the sale of the Ferguson Containers corrugated packaging business on April 7, 2025.
Gain on Extinguishment of Liabilities
Gain on extinguishment of liabilities includes gains recognized when outstanding liabilities are settled for amounts less than their carrying value, or when obligations are legally extinguished.
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Other Income
Other income includes the interest income received from the Wattum Note and Reichard Containers Note.
Results of Operations
Three Months Ended March 31, 2026 versus Three Months Ended March 31, 2025
The following table sets forth information comparing the components of net (loss) income from continuing operations for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31, | Period over Period Change | |||||||||||||||
| 2026 | 2025 | $ | % | |||||||||||||
| Revenues, net | $ | 7,561,965 | $ | 9,913,987 | $ | (2,352,022 | ) | -23.7 | % | |||||||
| Cost of revenues | 7,346,704 | 9,100,728 | (1,754,024 | ) | -19.3 | % | ||||||||||
| Gross profit | 215,261 | 813,259 | (597,998 | ) | -73.5 | % | ||||||||||
| Operating expenses: | ||||||||||||||||
| Selling, general and administrative | 10,728,546 | 2,229,425 | 8,499,121 | 381.2 | % | |||||||||||
| Restructuring and severance | - | - | - | 0.0 | % | |||||||||||
| Total operating expenses | 10,728,546 | 2,229,425 | 8,499,121 | 381.2 | % | |||||||||||
| Operating loss | (10,513,285 | ) | (1,416,166 | ) | (9,097,119 | ) | -642.4 | % | ||||||||
| Other (expense) income: | ||||||||||||||||
| Interest income (expense) | (276,718 | ) | (1,288,804 | ) | 1,012,086 | 78.5 | % | |||||||||
| Gain on divestiture | - | - | - | 0.0 | % | |||||||||||
| Gain on extinguishment of liabilities | 870,000 | - | 870,000 | 100.0 | % | |||||||||||
| Change in fair value of digital assets | (66,501,874 | ) | - | (66,501,874 | ) | -100.0 | % | |||||||||
| Gains on disposal of short-term investments | 6,019 | - | 6,019 | 100.0 | % | |||||||||||
| Other income | 279,954 | 21,898 | 258,056 | 1,178.5 | % | |||||||||||
| Total other income (expense), net | (65,622,619 | ) | (1,266,906 | ) | (64,355,713 | ) | -5,213.9 | % | ||||||||
| Income (loss) before income taxes | (76,135,904 | ) | (2,683,072 | ) | (73,452,832 | ) | -2,737.6 | % | ||||||||
| Income tax expense (benefit) | - | (28,793 | ) | 28,793 | 100.0 | % | ||||||||||
| Net income (loss) from continuing operations | (76,135,904 | ) | (2,654,279 | ) | (73,481,625 | ) | -2,768.4 | % | ||||||||
| Net income (loss) from discontinued operations | - | 105,553 | (105,553 | ) | -100.0 | % | ||||||||||
| Net income (loss) | $ | (76,135,904 | ) | $ | (2,548,725 | ) | $ | (73,587,178 | ) | -2,887.2 | % | |||||
Revenue
For the three months ended March 31, 2026, revenues were $7,561,965, representing a decrease of $2,352,022, or 23.7%, compared to revenues of $9,913,987 for the three months ended March 31, 2025. The decrease reflects cancellation of certain agreements with customers and reduced order volumes from certain customers as the Company exited its liquidation-model operations and is in the process of winding down relationships where we previously were operating customer storefronts to mitigate losses.
Cost of Revenues
Cost of revenues was $7,346,704 for the three months ended March 31, 2026, compared to $9,100,728 for the three months ended March 31, 2025, a decrease of $1,754,024, or 19.3%. The decrease correlates to the reduction in volumes described above.
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Gross Profit
Gross profit decreased to $215,261 for the three months ended March 31, 2026, compared to gross profit of $813,259 for the three months ended March 31, 2025, a decline of $597,998, or 73.5%. The decrease was primarily driven by the decrease in revenues.
Operating Expenses
Selling, general and administrative (“SG&A”) expenses were $10,728,546 for the three months ended March 31, 2026, compared to $2,229,425 for the three months ended March 31, 2025, an increase of $8,499,121, or 381.2%.
The increase was attributable to:
| ● | Higher professional fees and advisory costs incurred in connection with the Company’s capital raising and the implementation of its Digital Asset Treasury strategy; | |
| ● | Increased compensation and corporate overhead required to support expanded operations, including share-based compensation; and | |
| ● | Higher technology, compliance, and custodial-related costs associated with digital asset oversight. |
The Company did not incur restructuring or severance expenses in either period.
Interest Expense
Net interest expense totaled $(276,718) for the three months ended March 31, 2026, compared to $(1,288,804) for the three months ended March 31, 2025, a decrease of $1,012,086, or 78.5%, reflecting lower average borrowings on the Company’s financing facilities.
Gain on Extinguishment of Liabilities
The Company recognized a gain on extinguishment of liabilities of $870,000 for the three months ended March 31, 2026. The gain on extinguishment of liabilities was related to fulfilling the terms of settlement agreements for past rents and severances. There was no comparable activity in the prior-year period.
Change in Fair Value of Digital Assets
The Company recognized a loss of $(66,501,874) related to fair value changes of its digital asset holdings during the three months ended March 31, 2026. The Company did not hold digital assets during the comparable 2025 period.
Other Income
Other income increased to $279,954 for the three months ended March 31, 2026, from $21,898 in the prior-year period, an increase of $258,056, primarily due to addition of the Reichard Corrugated Note.
Income (Loss) Before Income Taxes
Loss before income taxes was $(76,135,904) for the three months ended March 31, 2026, compared to $(2,683,072) for the three months ended March 31, 2025. The increased loss is primarily attributable to the adoption of the Digital Asset Treasury strategy and the resulting fair value losses recognized during the period, as well as lower gross profit and higher SG&A expenses, as well as asset write-downs related to the exit from the liquidation business model for Forever 8.
Income tax expense
Income tax expense was $0 for the three months ended March 31, 2026, compared to an income tax benefit of $(28,793) for the three months ended March 31, 2025. The Company continues to maintain a full valuation allowance on its net deferred tax assets.
Net income (loss)
Net loss from continuing operations was $(76,135,904) for the three months ended March 31, 2026, compared to $(2,654,279) for the three months ended March 31, 2025. Net loss from discontinued operations was $0 for the three months ended March 31, 2026, compared to net income from discontinued operations of $105,553 for the three months ended March 31, 2025. Total net loss was $(76,135,904) for the three months ended March 31, 2026, compared to $(2,548,725) for the three months ended March 31, 2025.
Liquidity and Capital Resources
Overview
Eightco Holdings Inc. funds its operations through a combination of equity and debt financing, including proceeds from its At-The-Market (“ATM”) offering program, private placement transactions, and borrowings under its line of credit facility. These proceeds were deployed primarily into the Company’s Digital Asset Treasury and strategic investments.
As of March 31, 2026, the Company had cash and cash equivalents of $7,546,486, compared to $58,501,108 as of December 31, 2025. In addition to cash, the Company held digital assets at fair value of $175,309,890 as of March 31, 2026. Combined cash and digital assets were approximately $182.9 million as of March 31, 2026. Total assets of $340,632,698 at March 31, 2026, and total liabilities of $18,304,512, resulting in total stockholders’ equity of $322,328,186 at March 31, 2026.
Outstanding debt as of March 31, 2026 consisted of $8,725,000 under the Company’s lines of credit and $400,000 under lines of credit with related parties, for a total outstanding lines of credit of $9,125,000. Outstanding debt as of December 31, 2025 consisted of $8,150,000 under the Company’s lines of credit and $2,590,000 under lines of credit with related parties, for a total outstanding lines of credit of $10,740,000, as reported in our Annual Report on Form 10-K. The lines of credit bear interest at rates ranging from 12% to 18% and are collateralized by the inventory of the Company.
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The sale of the Ferguson Containers corrugated packaging business was completed on April 7, 2025. The Company received $557,835 in cash proceeds at closing plus a $2.5 million seller note receivable, and the buyer assumed certain liabilities. The divestiture generated a gain of $1,231,774 and eliminated the operating overhead associated with that business segment.
Liquidity Profile
As of March 31, 2026, our liquidity resources consisted of $7.5 million of cash and cash equivalents, $32.5 million of short-term investments (consisting of U.S. government securities and money market funds), and $75.5 million of U.S. dollar-denominated stablecoins, for total near-cash liquidity of approximately $115.6 million. We also held an additional $99.8 million of other digital assets (primarily Worldcoin (WLD) and Ethereum (ETH)), which are subject to market price volatility. We actively manage working capital by converting stablecoins and, when appropriate, other digital assets to U.S. dollars to meet operating needs. During the three months ended March 31, 2026, we used $4.7 million of cash in operating activities, or approximately $1.6 million per month. Substantially all of our reported $76.1 million net loss for the quarter consisted of non-cash items, including a $66.5 million unrealized loss on digital assets and $5.1 million of non-cash share-based compensation. Based on our current operating cash use, we believe our near-cash liquidity is sufficient to fund our operating cash needs for substantially in excess of the next 12 months, before consideration of additional capital that may be raised under our at-the-market equity offering program or monetization of our other digital asset and strategic investment holdings.
Sources of Liquidity
ATM Program
We raised additional capital during the quarter under our ATM program. Proceeds were used to acquire digital assets and fund working capital needs.
Forever 8 Credit Facilities (Series A, B, C, and D)
Forever 8 continues to rely on its secured inventory financing facilities (the “Forever 8 Facilities”), which remain active. As of March 31, 2026, we had approximately $9.1 million outstanding and unused availability of approximately $2.0 million under the Forever 8 Facilities, subject to borrowing base and other conditions.
In the aggregate, these facilities provide:
| ● | Interest rates ranging from 15% to 18% per annum | |
| ● | Unused commitment fees of approximately 5% per annum | |
| ● | A revolving draw structure through “Initial Loan Advances” and “Subsequent Draws” from lender-controlled escrows | |
| ● | Collateral in the form of Forever 8 inventory, equipment, and related proceeds |
As of March 31, 2026, Forever 8 had approximately $9.1 million outstanding under these facilities to support ongoing inventory purchases.
Digital Assets as Liquidity
Certain digital assets, particularly U.S. dollar-denominated stablecoins, function as near-cash liquidity sources and may be converted to U.S. dollars as needed.
Uses of Liquidity
Digital Asset Purchases
We deploy a substantial portion of ATM proceeds to acquire digital assets. As of March 31, 2026, we held digital assets at fair value of approximately $175.3 million, consisting primarily of Worldcoin (WLD), Ethereum (ETH), and U.S. dollar-denominated stablecoins. These assets are measured at fair value under ASU 2023-08, with changes recognized in net income, and are custodied with institutional-grade providers, including Kraken, Coinbase, and FalconX.
Strategic Private Company Investments
We also deploy liquidity into strategic equity investments in frontier technology companies as part of our long-term capital allocation strategy. In March 2026, we invested $92.6 million in indirect beneficial interests in OpenAI preferred stock, which represents approximately 30% of our total treasury position. We also invested approximately $18 million in Beast Industries, the business platform of content creator MrBeast. An additional $7 million capital commitment was callable through May 9, 2026, at which point the call period expired without being exercised. Additionally, in October 2025, we invested approximately $1 million in Series D Preferred Stock of Mythical, Inc., a developer of blockchain-based video game ecosystems.
Forever 8 Inventory Funding
Forever 8 uses liquidity to support inventory purchasing activities on behalf of e-commerce merchants. These requirements are funded through:
| ● | Operating cash flows | |
| ● | Digital asset conversions | |
| ● | Borrowings under the Forever 8 Facilities |
Operating and Corporate Needs
Liquidity is also used to support routine corporate expenses, personnel, professional fees, vendor obligations, and other working capital needs.
Digital Asset Volatility
During Q1 2026, we recognized net losses of approximately $66.5 million related to changes in the fair value of digital assets, which materially affected reported results and may impact future liquidity planning given price volatility. Although our $115.6 million of near-cash liquidity (consisting of cash, short-term investments, and stablecoins) is not directly subject to WLD or ETH price movements, a sustained decline in the price of WLD or ETH would reduce the realizable value of our remaining $99.8 million of digital asset holdings and would limit the total liquidity available from our digital asset portfolio. We continue to monitor digital asset market conditions and may adjust our treasury strategy as appropriate.
Subsequent Events Affecting Liquidity
Subsequent to March 31, 2026, we issued 19,054,067 shares under our ATM for proceeds of approximately $19.4 million. We also amended our consulting agreement to provide for a flat consulting fee equal to 1% of AUM across treasury and investment assets, which will affect cash outflows over the next 12 months. See Note 21 — Subsequent Events for additional information.
Future Liquidity Considerations
Our liquidity in future periods will be influenced by:
| ● | The fair value of digital assets held under the DAT Strategy | |
| ● | Market conditions affecting potential capital raises | |
| ● | Working capital needs of Forever 8 | |
| ● | Digital asset market liquidity and volatility | |
| ● | Regulatory developments affecting digital asset custody, trading, and classification | |
| ● | Broader macroeconomic conditions impacting e-commerce demand |
Based on current assumptions and our existing near-cash liquidity of approximately $115.6 million, our other digital asset and strategic equity investment holdings, our continued access to capital through our at-the-market equity offering program, and our currently anticipated operating cash use of approximately $1.6 million per month, we believe our liquidity resources are sufficient to support both our operating business and Digital Asset Treasury Strategy for at least the next twelve months.
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Cash Flows
Since inception, Eightco and its subsidiaries have primarily used its available cash to fund its operations. The following table sets forth a summary of cash flows for the periods presented:
For the Three Months Ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Cash (used in) provided by: | ||||||||
| Operating Activities | $ | (4,691,568 | ) | $ | 999,824 | |||
| Investing Activities | (209,008,951 | ) | (44,647 | ) | ||||
| Financing Activities | 162,745,897 | (759,937 | ) | |||||
| Net increase (decrease) in cash and restricted cash | $ | (50,954,622 | ) | $ | 195,240 | |||
Cash Flows for the Three Months Ended March 31, 2026 and 2025
Operating Activities
Net cash used in operating activities was $(4,691,568) during the three months ended March 31, 2026, which consisted primarily of the net loss of $(76,135,904), offset by noncash items including the change in fair value of digital assets of $66,501,874, share-based compensation of $5,141,071, depreciation and amortization of $5,102, and a gain on disposal of $(5,949). Changes in assets and liabilities used cash of $(197,762), primarily reflecting a decrease in accrued expenses and other current liabilities of $(1,244,749) and an increase in accounts receivable of $(34,254), partially offset by a decrease in prepaid expenses and other current assets of $706,642, a decrease in inventories of $325,798, and an increase in accounts payable of $48,801.
Net cash provided by operating activities was $999,824 during the three months ended March 31, 2025, which consisted primarily of the net loss of $(2,548,725), offset by noncash items including depreciation and amortization of $612,664 (continuing and discontinued operations) and amortization of debt issuance costs of $250,000. Changes in assets and liabilities provided cash of $2,685,885, primarily reflecting decreases in inventories of $1,852,604 and accounts receivable of $978,029, and an increase in accrued expenses and other current liabilities of $180,856, partially offset by a decrease in accounts payable of $(450,667), an increase in prepaid expenses and other current assets of $254,118, and changes in discontinued operations of $(129,055).
Investing Activities
Net cash used in investing activities was $(209,008,951) during the three months ended March 31, 2026, compared to $(44,647) for the three months ended March 31, 2025. The increase in net cash used in investing activities is largely attributable to purchases of investments of $(336,039,104) and purchases of digital assets of $(65,910,119) in connection with the implementation of the Company’s Digital Asset Treasury strategy, partially offset by proceeds from the sale of investments of $192,902,626 and repayments of principal under loans held-for-investment of $37,646.
Financing Activities
Net cash provided by financing activities was $162,745,897 during the three months ended March 31, 2026, compared to net cash used in financing activities of $(759,937) for the three months ended March 31, 2025. The change was largely attributable to net proceeds from the issuance of common stock of $165,360,897 generated through the Company’s ATM program, partially offset by a $1,000,000 prepayment under a contract to repurchase and cancel shares of our common stock in a future period and net repayments under the line of credit of $1,615,000. Net proceeds from the issuance of common stock reflect gross ATM proceeds of $167.6 million, reduced by $2.2 million of cash offering costs paid during the quarter and an additional $3.1 million of offering costs incurred during the quarter remained accrued and unpaid as of March 31, 2026 and are reflected as a non-cash item in the supplemental disclosure of cash flow information.
During the quarter ended March 31, 2026, the Company had an unfunded capital commitment of approximately $7 million to Beast Industries, which was committed for a period of 60 days following the Company’s initial investment. While not a variable interest or structured entity, this commitment represents a contractual obligation that, if called, would have had an impact on liquidity. The applicable period of the commitment expired on May 9, 2026.
Known Trends, Events, Uncertainties and Factors That May Affect Future Operations
Our results and liquidity may be materially affected by:
| ● | Digital asset market volatility, including price, volume, and spreads for WLD and other tokens; | |
| ● | Regulatory developments affecting custody, stablecoins, or exchange operations and their impact on access, withdrawals, or pricing; | |
| ● | Custodian concentration and counterparty risk, including operational incidents, solvency, or cybersecurity; | |
| ● | Capital markets conditions impacting our ability to raise additional equity via PIPE or ATM transactions; | |
| ● | Interest rate levels influencing borrowing costs under the Forever 8 Facilities and customer demand for inventory financing; and | |
| ● | Macro factors (consumer demand, e-commerce trends, geopolitics, inflation, and credit availability). |
Contractual Obligations and Commitments
The Company has no debt covenants that require certain financial information to be met. The following summarizes our material cash requirements as of March 31, 2026:
Unfunded Capital Commitment. As of March 31, 2026, we had an unfunded capital commitment of approximately $7 million to Beast Industries, which was able to be called within 60 days of our initial investment and expired on May 9, 2026.
Consulting Fees. Under the Amended and Restated DACA, we are obligated to pay a consulting fee equal to 1% per annum of assets under management. Based on current AUM levels, we expect cash consulting fees of approximately $2.5 million to $3.5 million over the next 12 months.
Credit Facility Interest and Fees. Based on current borrowing levels and interest rates ranging from 12% to 18%, we expect interest expense and commitment fees under our credit facilities of approximately $1.2 million to $1.5 million over the next 12 months.
Critical Accounting Policies and Significant Judgments and Estimates
This discussion and analysis of the Company’s financial condition and results of operations is based on the Company’s combined financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States of America, or U.S. GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reported periods. In accordance with U.S. GAAP, the Company bases its estimates on historical experience and on various other assumptions the Company believes are reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.
For information on the Company’s significant accounting policies please refer to Note 2 to the Company’s Financial Statements included in this Quarterly Report.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are a smaller reporting company and are not required to provide certain Item 305 disclosures. There have been no material changes from our year-end market risk profile.
ITEM 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
The Company’s management, with the participation of the Company’s Principal Executive Officer and Principal Financial and Accounting Officer has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report. Based on such evaluation, the Company’s Principal Executive Officer and Principal Financial and Accounting Officer have concluded that, as of the end of such period covered by this Quarterly Report, the Company’s disclosure controls and procedures were not effective to provide reasonable assurance that information that it is required to disclose in reports that the Company files with the SEC is recorded, processed, summarized and reported within the time periods specified by the Exchange Act rules and regulations due to the reasons set forth below.
As of December 31, 2025, management identified the following material weakness in our internal control over financial reporting: the Company was unable to provide a timely financial reporting package in connection with the year end audit. This was primarily the result of the Company’s limited accounting personnel. This also limits the extent to which the Company can segregate incompatible duties and has a lack of controls in place to ensure that all material transactions and developments impacting the financial statements are reflected. There is a risk under the current circumstances that intentional or unintentional errors could occur and not be detected.
Management has concluded that the material weakness described above currently exists as of March 31, 2026. We continue to remediate the material weakness identified as of December 31, 2025, which persisted at March 31, 2026. During Q4 2025 and into 2026 we are: (i) augmenting accounting resources (including SEC reporting and technical accounting) to improve the timeliness and quality of period-end close; (ii) formalizing and documenting key controls over the financial close, including reconciliations, review controls, and segregation of duties; (iii) implementing enhanced IT-dependent manual controls to support completeness and accuracy of reports used in controls; and (iv) planned engagement of external advisors during the second half of 2026 to assist with design, implementation, and testing of internal controls.
Changes in Internal Control over Financial Reporting
Other than (i) the remediation actions described above, there were no other changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting during the quarter ended March 31, 2026.
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PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
From time to time, the Company is party to legal actions that are routine and incidental to its business. However, based upon available information and in consultation with legal counsel, management does not expect the ultimate disposition of any or a combination of these actions to have a material adverse effect on the Company’s assets, business, cash flow, condition (financial or otherwise), liquidity, prospects and/or results of operations.
ITEM 1A. RISK FACTORS
An investment in our securities involves certain risks. Before deciding to invest in our common stock, you should consider carefully the following discussion of risks and uncertainties affecting us and our securities, together with other information in this Quarterly Report. Our business, business prospects, financial condition or results of operations could be seriously harmed as a result of these risks. This could cause the trading price of our common stock to decline, resulting in a loss of all or part of your investment. Additional risks and uncertainties not presently known to us or that we currently deem immaterial, also may materially and adversely affect our business, financial condition and results of operations. Please also read carefully the section above entitled “Cautionary Note Regarding Forward-Looking Statements.”
Other than as set forth below, there have been no material changes to the “Risk Factors” disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025. The risk factors below supplement, and to the extent inconsistent supersede, the risk factors set forth in our Annual Report.
Risks Related to Our Strategic Investments
Our strategic investment portfolio is concentrated in a small number of privately held companies, and a decline in the value of, or total loss with respect to, any single investment could materially adversely affect our financial condition and results of operations.
During the three months ended March 31, 2026, we deployed approximately $110.6 million of capital into strategic equity investments, including approximately $92.6 million in OpenAI and approximately $18.0 million in Beast Industries, in addition to our prior $1.0 million investment in Mythical Games. These three positions collectively represent a substantial portion of our non-digital-asset balance sheet, and we currently intend to continue to deploy material amounts of capital into similarly concentrated positions over time. We have not adopted formal diversification limits with respect to our strategic investments, and we may make additional concentrated investments in the future. Because our strategic investment portfolio is concentrated in a limited number of issuers, a decline in the value of, or a total loss with respect to, any single investment could have a material adverse effect on our financial condition, results of operations, and the market price of our common stock.
Our strategic equity investments are highly illiquid, and we may be unable to sell, transfer, or otherwise monetize these investments when desired, or at all.
Our strategic investments are in privately held companies whose securities are not currently traded on any public market. These investments are subject to substantial transfer restrictions, including rights of first refusal, co-sale rights, lock-up provisions, and consent requirements imposed by the issuer, its board of directors, or other equity holders. In certain cases, our economic interest is held indirectly through special purpose vehicles or similar pooled investment structures that impose additional transfer and redemption restrictions. As a result, we may be unable to liquidate our strategic investments on a timely basis, without significant cost, at the carrying value reflected in our financial statements, or at all. Even if a portfolio company conducts an initial public offering or is acquired, our ability to realize value may be delayed by contractual restrictions, during which time the value of our position could decline materially. The illiquidity of these investments may also limit our ability to access capital from these holdings to fund operations or meet other obligations.
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We account for our strategic investments under the measurement alternative permitted by ASC 321, which may result in carrying values that do not reflect current fair value and may expose us to material impairment charges.
We account for our strategic equity investments in privately held companies that do not have readily determinable fair values under the measurement alternative permitted by ASC 321, Investments — Equity Securities. Under this method, we initially record investments at cost and subsequently adjust the carrying value only upon observable price changes in orderly transactions for identical or similar securities of the same issuer, or upon recognition of an impairment. Between observable transactions, the carrying value of an investment may not reflect its current fair value, which could be materially higher or lower than the amount reported on our balance sheet. If we identify an indicator of impairment, we are required to estimate fair value and, if the estimated fair value is less than the carrying value, recognize an impairment charge equal to the difference. Indicators of impairment may include a significant deterioration in a portfolio company’s earnings performance, financial condition, or business prospects; a significant adverse change in the regulatory, economic, or technological environment; a bona fide offer to purchase or sell the investment at an amount less than the carrying value; or factors raising significant concerns about the issuer’s ability to continue as a going concern. The recognition of an impairment charge, or a series of impairment charges, could have a material adverse effect on our results of operations in the period recognized. The absence of frequent observable transactions for our portfolio company securities may also delay the recognition of declines in value, resulting in carrying values that overstate the actual realizable value of these investments.
As a minority investor, we have limited information rights and little or no governance control with respect to the issuers of our strategic investments, and we depend on the management teams of our portfolio companies.
As a minority investor in privately held companies, we generally do not have voting board representation or substantive governance influence with respect to the companies underlying our strategic investments. Our information rights are typically limited to those provided by the issuer’s organizational documents, our investment agreements, or applicable law, and may not include audited financial statements, detailed operating metrics, or timely updates on material developments at the portfolio company. We rely on the management teams of our portfolio companies to operate those companies, make strategic decisions, manage capital, and report financial and operating results to investors. We have very little to no ability to direct or influence operating decisions at these companies. Any management failure, strategic misstep, governance failure, fraud, or other adverse development at a portfolio company could result in a material decline in or loss of our investment, and we may not become aware of such developments on a timely basis.
Certain of our strategic investments are held through special purpose vehicles or similar pooled investment structures, which subject us to additional risks beyond those of the underlying portfolio company.
In certain cases, our economic exposure to a portfolio company is held indirectly through a special purpose vehicle, fund-of-one structure, or similar pooled investment vehicle managed by a third party rather than through direct equity ownership of the portfolio company. These structures may subject us to additional risks not present in a direct equity investment, including management, administrative, and performance fees payable to the sponsor or general partner, which reduce our net returns; limited or no governance rights with respect to the investment vehicle itself; restrictions on transfer or redemption of our interests in the vehicle; the risk that the vehicle’s sponsor or manager fails to perform its obligations, becomes insolvent, or engages in conduct adverse to our interests; reliance on the vehicle for information about the underlying portfolio company, which may be less timely or complete than direct issuer disclosures; and potential adverse tax consequences. The failure of an investment vehicle, or adverse conduct by its sponsor or manager, could result in a loss of all or substantially all of our investment, even if the underlying portfolio company performs well. Where our economic exposure to a portfolio company is held through a multi-tier investment structure, information about the underlying portfolio company may flow through multiple intermediaries before reaching us, which may further delay or limit our ability to evaluate the performance of the investment.
A substantial portion of our balance sheet is invested in illiquid digital assets and strategic equity investments, which may limit our ability to fund operations or respond to adverse developments without additional financing.
A substantial portion of our total assets consisted of digital asset holdings and illiquid strategic equity investments, while our recurring operating cash flows have been negative. Our ability to fund operations, repay indebtedness, or otherwise meet our obligations depends in part on our ability to monetize digital assets at acceptable prices, which is subject to market volatility; realize value from our strategic equity investments, which are illiquid and may not be saleable when needed; and access additional financing through our at-the-market equity offering program or other capital markets transactions. The availability and cost of capital markets financing depend significantly on prevailing market conditions, including the trading price and volume of our common stock and broader equity capital markets sentiment, and such financing may not be available on favorable terms or at all. A decline in the market price of our common stock could reduce the amount of capital we can raise on favorable terms through our at-the-market program and sales of our common stock at lower per share prices would result in greater rates of dilution to existing stockholders. If we are unable to monetize portions of our digital assets, realize value from strategic equity investments, or access capital markets on acceptable terms, we may be required to delay or otherwise curtail planned investment activity, reduce operating expenditures, sell assets at unfavorable prices, or on unfavorable terms, or pursue alternative financing on adverse terms, any of which could have a material adverse effect on our business, financial condition, and results of operations.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
There were no unregistered sales of equity securities during the three months ended March 31, 2026.
The Company did not repurchase any of its equity securities during the period.
ITEM 5. OTHER INFORMATION
During
the three months ended March 31, 2026, no director or officer
ITEM 6. EXHIBITS
(b) Exhibits
The following documents are filed as exhibits hereto:
| Exhibit No. | Description | |
| 2.1 | Plan of Conversion (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed February 5, 2026). | |
| 3.1 | Certificate of Formation (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed February 5, 2026). | |
| 3.2 | Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K filed February 5, 2026). | |
| 10.101 | Form of Amendment to Lock-Up Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed January 5, 2026). | |
| 31.1* | Certification of the Chief Executive Officer of the Company, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 31.2* | Certification of the Chief Financial Officer of the Company, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 32.1** | Certification of the Chief Executive Officer and Chief Financial Officer of the Company, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 101.INS* | Inline XBRL Instance Document – the XBRL Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document. | |
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
| 104* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
| * | Filed herewith. |
| ** | Furnished herewith. |
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: May 15, 2026
| EIGHTCO HOLDINGS INC. | ||
| By: | /s/ Kevin O’Donnell | |
| Name: | Kevin O’Donnell | |
| Title: | Chief Executive Officer | |
| EIGHTCO HOLDINGS INC. | ||
| By: | /s/ Brett Vroman | |
| Name: | Brett Vroman | |
| Title: | Chief Financial Officer | |
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