BGDE

MKT CAP $25.5MP/E —DIV YIELD —FCF YIELD -97.66%REV TTM $27.4M −46.0%NET INCOME −$22.1MNET DEBT $8.9M52W 1.71 – 28.60SEC XBRL · TTM TO Invalid Date

How BGDE rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

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New in FY2025

You should consider carefully the following information about these risks, together with the other information contained in this Annual Report, including the risks and uncertainties addressed in the sections entitled “CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, before making an investment decision.
These risks are discussed more fully below and include, but are not limited to, risks related to: Risks Relating to Our Business and Management - our history of incurring losses; - our need to, and difficulty in, raising additional capital and repossession of collateral securing current loans in default; - the potential of being delisted from Nasdaq; - downturns in the digital assets industry; - inflation; - increased interest rates; - the inability to procure needed hardware; - risks associated with our expansion into the Artificial Intelligence (“AI”) and High-Performance Computing (“HPC”) markets; - the failure or breakdown of mining equipment; - outages and limitations of internet connectivity; - access to reliable and reasonably priced electricity sources; - cyber-security threats; - our ability to obtain proper insurance; - the prices of digital assets; - our reliance on a small number of key employees; - our failure to effectively manage our growth including not growing or improving our current hashrate; - the competitiveness of the digital assets mining, AI and HPC industry; - global climate change and related environmental regulations; - the potential cancellation or withdrawal of required operating and other permits and licenses; and - banks and other financial institutions ceasing to provide services to people in our industry, whether through choice or due to their own insolvency or failure.
Risks Relating to Laws, Regulatory Frameworks, and Legal Action - regulatory changes and changes in interpretations of existing regulations, including for digital assets like Bitcoin, or Bitcoin mining itself (including the imposition of taxes, limits on mining (or power usage), or new licensing regimes); - our ability to timely and effectively implement controls and procedures required by Section 404 of the Sarbanes-Oxley Act of 2002; - future developments regarding the treatment of digital assets for U.S. federal income and foreign tax purposes, or other taxes on Bitcoin mining; - regulatory intervention by governments impacting the right to mine, acquire, own, hold, sell, exchange or use Bitcoin or other digital assets; - additional legislation or guidance may be issued by U.S. and non-U.S. governing bodies that may differ significantly from our practices or interpretation of the law, which could have unforeseen effects on our financial condition and results of operations; - legislative, regulatory and litigation threats regarding climate change and energy conservation, legislative, regulatory and litigation threats regarding climate change and energy conservation; - changes to laws regarding the operation of exchanges by third parties may make the business model unsustainable and may lead to an inability to exchange mined Bitcoin for fiat currency efficiently; and - material litigation (including with our lenders and counter-parties counterparties), investigations or enforcement actions by regulators and governmental authorities.
Our inability to achieve and then maintain profitability would negatively affect our business, financial condition, results of operations and cash flows.
We receive a significant portion of our digital colocation revenues from a limited number of customers.
The loss of a major customer could adversely affect our business.
We have in the past and expect to continue to derive a significant portion of our digital colocation revenues from a relatively limited number of customers.
The loss of any one or more of these customers, a significant change in their business model, or in their ability to make payments when due, could materially and adversely affect our sales, financial condition and liquidity.
These factors are largely beyond our control and the resulting loss in revenues may be difficult or impossible to replace.
Recently, we experienced the loss of one of our former most significant colocation customers due to its acquisition by one of our competitors.
If we are unsuccessful in offsetting the decline in colocation revenue from this customer with revenue from new colocation customers or other existing customers, our revenues and results of operations could be materially adversely affected.
Changes in our business strategy or restructuring of our businesses may increase our costs or otherwise affect our businesses.
We continually review our operations with a view toward reducing our cost structure, including, but not limited to, reducing our labor cost-to-revenue ratio, improving process and system efficiencies and increasing our revenues and operating margins.
Despite these efforts, we have needed and may continue to need to adjust our business strategies to meet these changes, or we may otherwise find it necessary to restructure our operations or particular businesses or assets.
When these changes or events occur, we may incur costs to change our business strategy and may need to write down the value of assets or sell certain assets.
Additionally, any of these events could result in disruptions or adversely impact our relationships with our workforce, suppliers and customers.
In any of these events our costs may increase, and we may have significant charges or losses associated with the write-down or divestiture of assets and our business may be materially and adversely affected.
Our financial statements as of December 31, 2025, have been prepared on the basis that we will be able to continue as a going concern and do not include any adjustments that might result from the outcome of this uncertainty.
At December 31, 2025, our accumulated deficit was $252.5 million, our cash and cash equivalents were $13.3 million, we had negative working capital of $31.3 million, and we had an aggregate of $25.2 million of debt.
Based on our current operating plan estimates, we do not have sufficient cash to satisfy our working capital needs and other liquidity requirements over the next 12 months from the date of this Annual Report.
We may be forced to obtain additional capital when our stock price or trading volume or both are low, or when the general market for digital assets, AI or HPC companies is weak.
We are exploring and evaluating strategic options and capital-raising transactions.
We cannot assure you that our evaluation of strategic options will result in any particular outcome, and the perceived uncertainties related to Mawson could adversely affect our business and our stockholders.
We expect to continue to consider and evaluate potential strategic options and capital-raising transactions including, among other things, dispositions of certain businesses and assets and significant equity investments in us by third parties.
Any capital-raising through equity or convertible debt could result in significant dilution to existing stockholders.
In addition, newly issued securities may have rights, preferences, or privileges senior to those of our common shares.
The process of reviewing potential strategic opportunities may be time consuming, distracting and disruptive to our business operations.
Any potential transaction may be dependent on a number of factors that may be beyond our control, for example, market conditions, industry trends or acceptable terms.
We may ultimately determine that no transaction is in the best interest of our stockholders and there can be no assurance that we will pursue or enter into any transaction at all.
There can be no assurance of the impact to the value of our Common Stock after the announcement or consummation of any strategic transaction.
In addition, any perceived uncertainty regarding our future operations may limit our ability to retain or hire qualified personnel.
We do not currently intend to disclose further developments with respect to this process, unless and until our Board of Directors (the “Board”) approves a specific transaction or otherwise concludes the review of strategic options.
If we are unable to effectively manage the strategic review process, our business, financial condition, liquidity and results of operations could be adversely affected.
The responsibility of the direction and operation of our business relies heavily on a small number of key people, including our Interim Chief Executive Officer and our Chief Financial Officer.
We have experienced changes to our executive leadership, including the appointment of Kaliste Saloom as our Interim Chief Executive Officer in June 2025 and departure of Rahul Mewawalla as our Chief Executive Officer and President in July 2025.
Our business relies on digital assets-specific hardware such as the Miners, and containers in which to operate the Miners, and also more general plant and equipment such as transformers, breakers, power boards exhaust fans, deflectors, monitoring equipment and many other parts.
Beginning in 2025, the U.S. government announced significantly increased tariffs on foreign imports into the U.S. from certain countries, including China, Canada and Mexico, and in some cases threatened to impose additional tariffs.
In response, several countries have imposed, or threatened to impose, reciprocal tariffs on imports from the U.S. and other retaliatory measures.
Additionally, the government of China in particular exerts a high level of influence and control over its economy and businesses (private and state owned).
A number of factors drive the adoption of ever more efficient Miners in the Bitcoin mining industry, including energy prices, the fact that the Bitcoin algorithm was designed so that as more computing power is added to the network, the difficulty to mine for each block increases, and halving events.

and 93 more.

Gone since FY2024

You should consider carefully the following information about these risks, together with the other information contained in this Annual Report, including the matters addressed in the sections entitled “CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, before making an investment decision.
These risks are discussed more fully below and include, but are not limited to, risks related to: Risks Relating to Our Business and Management - our history of incurring losses; - our need to, and difficulty in, raising additional capital and repossession of collateral securing current loans in default; - the potential of being delisted from Nasdaq; - downturns in the digital assets industry; - inflation; - increased interest rates; - the inability to procure needed hardware; - risks associated with our expansion into the Artificial Intelligence (“AI”) and High-Performance Computing (“HPC”) markets; - the failure or breakdown of mining equipment; - outages and limitations of internet connectivity; - access to reliable and reasonably priced electricity sources; - cyber-security threats; - our ability to obtain proper insurance; - the prices of digital assets; - our reliance on a small number of key employees; - our failure to effectively manage our growth including not growing or improving our current hashrate; - the competitiveness of the digital assets industry; - global climate change and related environmental regulations; - the potential cancellation or withdrawal of required operating and other permits and licenses; and - banks and other financial institutions ceasing to provide services to people in our industry, whether through choice or due to their own insolvency or failure.
Risks Relating to Laws, Regulatory Frameworks, and Legal Action - regulatory changes and changes in interpretations of existing regulations, including for digital assets like Bitcoin, or Bitcoin mining itself (including the imposition of taxes, limits on mining (or power usage), or new licensing regimes); - our ability to timely and effectively implement controls and procedures required by Section 404 of the Sarbanes-Oxley Act of 2002; - future developments regarding the treatment of digital assets for U.S. federal income and foreign tax purposes, or other taxes on Bitcoin mining; - regulatory intervention by governments impacting the right to mine, acquire, own, hold, sell, exchange or use Bitcoin or other digital assets; - additional legislation or guidance may be issued by U.S. and non-U.S. governing bodies that may differ significantly from our practices or interpretation of the law, which could have unforeseen effects on our financial condition and results of operations, additional legislation or guidance may be issued by U.S. and non-U.S. governing bodies that may differ significantly from our practices or interpretation of the law, which could have unforeseen effects on our financial condition and results of operations; - legislative, regulatory and litigation threats regarding climate change and energy conservation, legislative, regulatory and litigation threats regarding climate change and energy conservation; - changes to laws regarding the operation of exchanges by third parties may make the business model unsustainable and may lead to an inability to exchange mined Bitcoin for fiat currency efficiently, changes to laws regarding the operation of exchanges by third parties may make the business model unsustainable and may lead to an inability to exchange mined Bitcoin for fiat currency efficiently; - material litigation (including with our lenders and counter-parties counterparties), investigations or enforcement actions by regulators and governmental authorities; and - because there has been limited precedent set for financial accounting of Bitcoin and other digital assets, the determination that we have made for how to account for digital assets transactions may be subject to change.
Our inability to achieve and then maintain profitability would negatively affect our business, financial condition, res u lts of operations and cash flows.
Our financial statements as of December 31, 2024, have been prepared on the basis that we will be able to continue as a going concern and do not include any adjustments that might result from the outcome of this uncertainty.
At December 31, 2024, our accumulated deficit was $228.8 million, our cash and cash equivalents were $6.1 million, we had negative working capital of $35.9 million, and we had an aggregate of $20.9 million of debt.
In addition, the Celsius deposit of $15.3 million is the subject of an ongoing legal dispute and litigation.
Based on our current operating plan estimates, we do not have sufficient cash to satisfy our working capital needs and other liquidity requirements over the next 12 months from the date of this report.
We may be forced to obtain additional capital when our stock price or trading volume or both are low, or when the general market for digital assets companies is weak.
The responsibility of the direction and operation of our business relies heavily on a small number of key people, including our CEO and CFO.
Recently, we experienced updates to our executive leadership, including the departure of William “Sandy” Harrison as our CFO in January 2025 and the appointment of William C.
Regan as our new CFO in January 2025 at the same time.
In June 2024, Kaliste Saloom, previously Corporate Secretary and acting General Counsel of the Company, was appointed as our General Counsel and Corporate Secretary.
The global supply chains are increasingly risky and complex.
Our business relies on digital assets-specific hardware such as the Miners, and containers in which to operate the Miners, and also more general plant and equipment such transformers, breakers, power boards exhaust fans, deflectors, monitoring equipment and many other parts.
Recently, the U.S. government has threatened significantly increased tariffs on foreign imports into the U.S. from certain countries, including China, Canada and Mexico.
Additionally, the government of the People’s Republic of China in particular exerts a high level of influence and control over its economy and businesses (private and state owned).
In addition, the failure of any critical single piece of equipment may represent a single point of failure which could have widespread impacts.
An example of this could be a fire within a substation resulting in a total power outage for a mining facility for a period until the substation was rebuilt, or a blown fuse which may affect any part of our facility.
Such widespread mechanical issues or critical failures for any material duration would therefore decrease our revenue.
A number of factors drive the adoption of ever more efficient Miners in the Bitcoin mining industry, including energy prices, the fact the Bitcoin algorithm was designed so that as more computing power is added to the network, the difficulty to mine for each block increases, and halving events.
Mawson, like almost all businesses around the world, is subject to continuous malicious attempts to penetrate its systems.
We promptly and frequently liquidate digital assets that we mine and keep a minimum number of digital assets in our possession so as to minimize our risks against theft, loss, destruction or other issues relating to hackers and technological attack.
If an actual or perceived breach of our security system occurs, the market perception of the effectiveness of its security system could be harmed, which could adversely affect our business, financial condition, results of operations and prospects.
If our digital assets are lost, stolen or destroyed under circumstances rendering a party liable to us, the responsible party may not have the financial resources sufficient to satisfy our claim.
We promptly and frequently liquidate digital assets.
This may mean that we sell digital assets at a time when the prices on the respective digital asset exchange market are low, which could adversely affect our business, financial condition, results of operations and prospects.
Digital assets such as Bitcoin pricing has proven to be volatile, characterized by periods of extreme upturns and downturns that have lasted over lengthy time periods multiple times in digital assets’ history.
The price of Bitcoin can fluctuate due to investment and trading sentiment amongst users, speculators, and investors for a range of reasons, including changes in interest rate settings, or negative or positive publicity (for example due to legal proceedings or losses to Bitcoin investors due to fraud or cyber-attacks a digital assets exchange or online wallet).
A subsidiary of Mawson remains an unsecured creditor of Celsius Mining LLC, with two unpaid pre-petition invoices totaling in excess of $1.8 million.
Significant contributors to all or any digital asset network could propose amendments to the respective network’s protocols and software that, if accepted and authorized by such network, could adversely affect us.
With respect to Bitcoin networks, a small group of individuals contribute to the Bitcoin Core project on GitHub.com.
These individuals can propose refinements or improvements to the Bitcoin network’s source code through one or more software upgrades that alter the protocols and software that govern the Bitcoin network and the properties of Bitcoin, including the irreversibility of transactions and limitations on the mining of new Bitcoin.
Proposals for upgrades and discussions relating there to take place on online forums.
For example, there is an ongoing debate regarding altering the blockchain by increasing the size of blocks to accommodate a larger volume of transactions.
Although some proponents support an increase, other market participants oppose an increase to the block size as it may deter miners from confirming transactions and concentrate power into a smaller group of miners.
To the extent that a significant majority of the users and miners on the Bitcoin network install such software upgrade(s), the Bitcoin network would be subject to new protocols and software that could materially adversely affect our business, financial condition, results of operations and prospects.
In the event a developer or group of developers proposes a modification to the Bitcoin network that is not accepted by a majority of miners and users, but that is nonetheless accepted by a substantial plurality of miners and users, two or more competing and incompatible blockchain implementations could result.
This is known as a “hard fork.” In such a case, the “hard fork” in the blockchain could materially and adversely affect the perceived value of digital assets as reflected on one or both incompatible blockchains, which may materially adversely affect our business, financial condition, results of operations and prospects.
The impact of the Bitcoin halving, which took place in April 2024 has introduced uncertainly that could materially impact our self-mining revenue or our colocation services customers businesses.

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Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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