SEGMENTING REPORTING

6 Months Ended

Jun. 30, 2025

Segment Reporting [Abstract]

SEGMENTING REPORTING

21. SEGMENTING REPORTING

The Company’s principal operating segments coincide with the types of products to be sold. The products from which revenues are derived are consistent with the reporting structure of the Company’s internal organization. On April 7, 2025, the Company sold the assets of the Corrugated Packaging Business segment and as a result the Company will only have a single operating segment. The Company’s chief operating decision maker has been identified as the Chairman and CEO, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company.

Segment information is presented based upon the Company’s management organization structure as of June 30, 2025 and the distinctive nature of each segment. Future changes to this internal financial structure may result in changes to the reportable segments disclosed. There are no inter-segment revenue transactions and, therefore, revenues are only to external customers.

The CODM evaluates segment performance based on net revenues, cost of revenues, gross profit, and selling, general and administrative expenses. These items are reviewed by segment. Depreciation and amortization is also monitored by management and presented below. Certain other costs, such as interest expense, other income (expense), and income taxes, are managed on a consolidated basis and not allocated to segments.

Segment operating profit is determined based upon internal performance measures used by the chief operating decision maker. The Company derives the segment results from its internal management reporting system. The accounting policies the Company uses to derive reportable segment results are the same as those used for external reporting purposes.

Segment operating income excludes certain corporate costs that are not allocated to segments, including corporate-level general and administrative expenses and unallocated shared services. These items are disclosed separately as “Corporate.”

Management measures the performance of each reportable segment based upon several metrics, including net revenues, gross profit and operating loss. Management uses these results to evaluate the performance of, and to assign resources to, each of the reportable segments.

The Company does not allocate impairment charges, interest expense, income taxes, or other non-operating income or expenses to segments. Segment asset information is disclosed where reviewed by the CODM.

EIGHTCO HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

21. SEGMENTING REPORTING (continued)

Segment information available with respect to these reportable business segments for the three and six months ended June 30, 2025 and 2024 was as follows:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2025			2024			2025			2024
Revenues:
Inventory Management Solutions	$	7,578,646		$	5,283,593		$	17,492,633		$	13,242,290
Corrugated		-			1,661,123			1,773,929			3,394,543
Total segment and consolidated revenues	$	7,578,646		$	7,017,013		$	19,266,562		$	16,636,833
Cost of revenues:
Inventory Management Solutions	$	6,333,350		$	3,959,810		$	15,434,078		$	10,529,497
Corrugated		-			1,279,392			1,276,685			2,443,763
Total segment and consolidated cost of revenues	$	6,333,350		$	5,239,202		$	16,710,763		$	12,973,260
Gross profit:
Inventory Management Solutions	$	1,245,296		$	1,323,783		$	2,058,555		$	2,712,793
Corrugated		-			454,028			497,244			950,780
Total segment and consolidated gross profit	$	1,245,296		$	1,777,811		$	2,555,799		$	3,663,573
Income (loss) from operations:
Inventory Management Solutions	$	(710,710	)	$	(834,958	)	$	(1,600,823	)	$	(1,629,011	)
Corrugated		-			114,755			104,231			277,491
Corporate		(495,826	)		(963,207	)		(1,021,879	)		(3,322,925	)
Total segment and consolidated loss from operations	$	(1,206,536	)	$	(1,683,410	)	$	(2,518,471	)	$	(4,674,445	)
Depreciation and amortization:
Inventory Management Solutions	$	574,644		$	662,597		$	1,149,286		$	1,218,896
Corrugated		-			37,992			37,992			87,489
Total segment and consolidated depreciation and amortization	$	574,644		$	700,589		$	1,187,278		$	1,306,385
Revenues by geography:
North America	$	926,130		$	3,555,050		$	3,679,843		$	6,668,172
Europe		6,652,516			3,661,963			15,586,719			9,968,661
Total geography and consolidated revenues	$	7,578,646		$	7,017,013		$	19,266,562		$	16,636,833
Segment capital expenditures:
Inventory Management Solutions	$	-		$	-		$	-		$	-
Corrugated		-			4,847			4,847			4,847
Corporate		944			944			944			944
Total segment and consolidated capital expenditures	$	5,791		$	5,791		$	5,791		$	5,791
Segment total assets:
Inventory Management Solutions	$	43,521,257		$	43,865,557		$	43,521,257		$	43,865,557
Corrugated		-			1,908,065			-			1,908,065
Corporate		5,154,895			2,592,063			5,154,895			2,592,063
Total segment and consolidated assets	$	48,676,152		$	48,365,685		$	48,676,152		$	48,365,685