REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

6 Months Ended

Jun. 30, 2023

Accounting Changes and Error Corrections [Abstract]

REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

14. REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

During the review of the Company’s consolidated financial statements for the three and six months ended June 30, 2023, the Company identified an error in in which cost of revenue from the three months ended June 30, 2023 was recorded during the three months ended March 31, 2023. The error resulted in an overstatement in cost of revenue for the three months ended March 31, 2023.

This error also resulted in an overstatement of accrued expenses and other current liabilities as of March 31, 2023. Based on management’s evaluation of the SEC Staff’s Accounting Bulletins Nos. 99 (“SAB 99”) and 108 (“SAB 108”) and interpretations therewith, the Company concluded that the aforementioned errors were not material to the Company’s previously filed March 31, 2023 consolidated financial statements. This is further supported by the fact that the error would not likely have materially impacted a reasonable investor’s opinion of the Company’s financial condition and results of operations.

The following table presents the effect of the revision on the Company’s Consolidated Balance Sheets (in thousands):

	March 31, 2023
	As Corrected		As Filed		Change
Liabilities and Stockholders’ Deficit
Current Liabilities:
Accrued expenses and other current liabilities	$	47,299	$	58,596	$	(11,297)
Total Current Liabilities	203,449		214,746		(11,297)
Total Liabilities	1,157,480		1,168,777		(11,297)
Stockholders’ Deficit:
Accumulated deficit	(2,174,138)		(2,185,435)		11,297
Total Stockholders’ Deficit	$	(397,461)	$	(408,758)	$	11,297

The following table presents the effect of the revision on the Company’s Consolidated Statement of Operations for the three months ended March 31, 2023 (in thousands):

	Three Months Ended March 31, 2023
	As Corrected		As Filed		Change
Cost of revenue:
Cost of hosting services	$	16,198	$	18,826	$	(2,628)
Cost of digital asset mining	72,676		81,345		(8,669)
Total cost of revenue	88,874		100,171		(11,297)
Gross profit	31,781		20,484		11,297
Operating income (loss)	7,602		(3,695)		11,297
Loss before income taxes	(284)		(11,581)		11,297
Net loss	(388)		(11,685)		11,297
Net loss per share:
Basic	$	—	$	(0.03)	$	0.03
Diluted	$	—	$	(0.03)	$	0.03
Weighted average shares outstanding:
Basic	375,419		375,419		—
Diluted	375,419		375,419		—

The following table presents the effect of the revision on the Company’s Consolidated Statements of Changes in Stockholders’ Deficit (in thousands):

	Three Months Ended March 31, 2023
	Accumulated Deficit		Total Stockholders’ Deficit
As corrected - Net loss	$	(388)	$	(388)
As filed - Net loss	$	(11,685)	$	(11,685)
Change - Net loss	$	11,297	$	11,297
As corrected - Balance at March 31, 2023	$	(2,174,138)	$	(397,461)
As filed - Balance at March 31, 2023	$	(2,185,435)	$	(408,758)
Change - Balance at March 31, 2023	$	11,297	$	11,297

The following table presents the effect of the revision on the Company’s Consolidated Statements of Cash Flow (in thousands):

	Three Months Ended March 31, 2023
	As Corrected		As Filed		Change
Cash flows from Operating Activities:
Net loss	$	(388)	$	(11,685)	$	11,297
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Changes in operating assets and liabilities:
Accrued expenses and other	(906)		10,391		(11,297)
Net cash provided by (used in) operating activities	$	19,942	$	19,942	$	—
Net increase (decrease) in cash, cash equivalents and restricted cash	$	17,052	$	17,052	$	—
Cash, cash equivalents and restricted cash—beginning of period	52,240		52,240		—
Cash, cash equivalents and restricted cash—end of period	$	69,292	$	69,292	$	—