COVER
COVER | 6 Months Ended |
Jun. 30, 2022 | |
Document Information [Line Items] | |
Document Type | S-1/A |
Entity Registrant Name | Core Scientific, Inc./tx |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Entity Central Index Key | 0001839341 |
Amendment Flag | true |
Amendment Description | AMENDMENT NO.1 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Current Assets: | ||
Cash and cash equivalents | $ 128,542 | $ 117,871 |
Restricted cash | 11,938 | 13,807 |
Accounts receivable, net | 2,840 | 1,382 |
Accounts receivable from related parties | 677 | 300 |
Deposits for equipment | 165,662 | 358,791 |
Digital assets | 40,664 | 234,298 |
Prepaid expenses and other current assets | 161,234 | 30,111 |
Total Current Assets | 511,557 | 756,560 |
Property, plant and equipment, net | 1,049,070 | 597,304 |
Goodwill | 266,038 | 1,055,760 |
Intangible assets, net | 3,590 | 8,195 |
Other noncurrent assets | 14,903 | 21,045 |
Total Assets | 1,845,158 | 2,438,864 |
Current Liabilities: | ||
Accounts payable | 31,252 | 11,617 |
Accrued expenses and other | 124,488 | 67,862 |
Deferred revenue | 71,837 | 63,417 |
Deferred revenue from related parties | 36,923 | 72,945 |
Derivative warrant liabilities | 5,808 | 0 |
Finance lease liabilities, current portion | 28,570 | 28,452 |
Notes payable, current portion | 217,674 | 75,996 |
Total Current Liabilities | 516,552 | 320,289 |
Finance lease liabilities, net of current portion | 48,701 | 62,145 |
Notes payable, net of current portion (includes $726,554 and $557,007 at fair value) | 852,323 | 652,213 |
Other noncurrent liabilities | 11,130 | 18,531 |
Total Liabilities | 1,428,706 | 1,053,178 |
Contingently redeemable convertible preferred stock; $0.0001 par value; 2,000,000 shares authorized; — and 10,826 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively; $— and $45,164 total liquidation preference at June 30, 2022 and December 31, 2021, respectively | 0 | 44,476 |
Commitments and contingencies (Note 10) | ||
Stockholders' Equity: | ||
Common stock; $0.0001 par value; 10,000,000 shares authorized at both June 30, 2022 and December 31, 2021; 353,481 and 271,576 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively | 35 | 27 |
Additional paid-in capital | 1,695,748 | 1,379,581 |
Accumulated deficit | (1,304,111) | (27,432) |
Accumulated other comprehensive income (loss) | 24,780 | (10,966) |
Total Stockholders' Equity | 416,452 | 1,341,210 |
Total Liabilities, Redeemable Preferred Stock and Stockholders' Equity | $ 1,845,158 | $ 2,438,864 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Notes payable, fair value | $ 726,554 | $ 557,007 |
Contingently redeemable preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Contingently redeemable preferred stock, shares authorized (in shares) | 2,000,000,000 | 2,000,000,000 |
Contingently redeemable preferred stock, shares issued (in shares) | 0 | 10,826,000 |
Contingently redeemable preferred stock, shares outstanding (in shares) | 0 | 10,826,000 |
Contingently redeemable preferred stock, total liquidation preference | $ 0 | $ 45,164 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 10,000,000,000 | 10,000,000,000 |
Common stock, shares issued (in shares) | 353,481,000 | 271,576,000 |
Common stock, shares outstanding (in shares) | 353,481,000 | 271,576,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenue: | ||||
Digital asset mining revenue | $ 242,842 | $ 20,393 | ||
Total revenue | $ 163,972 | $ 75,303 | 356,491 | 129,549 |
Cost of revenue | 151,255 | 50,765 | 273,771 | 90,478 |
Gross profit | 12,717 | 24,538 | 82,720 | 39,071 |
Gain (loss) from sales of digital assets | 11,808 | (16) | 13,971 | 14 |
Impairment of digital assets | (150,213) | 0 | (204,198) | 0 |
Impairment of goodwill and other intangibles | (790,753) | 0 | (790,753) | 0 |
Losses on exchange or disposal of property, plant and equipment | (13,057) | (17) | (13,057) | (17) |
Operating expenses: | ||||
Research and development | 14,773 | 1,437 | 18,113 | 2,645 |
Sales and marketing | 10,238 | 720 | 11,636 | 1,254 |
General and administrative | 90,874 | 6,822 | 131,034 | 10,617 |
Total operating expenses | 115,885 | 8,979 | 160,783 | 14,516 |
Operating (loss) income | (1,045,383) | 15,526 | (1,072,100) | 24,552 |
Non-operating (income) expenses, net: | ||||
Loss on debt extinguishment | 0 | 7,974 | 0 | 8,016 |
Interest expense, net | 27,116 | 10,846 | 48,792 | 12,981 |
Fair value adjustment on convertible notes | (195,061) | 0 | 190,976 | 0 |
Fair value adjustment on derivative warrant liabilities | (22,189) | 0 | (32,464) | 0 |
Other non-operating expenses, net | 3,876 | 2 | 3,519 | 2 |
Total non-operating (income) expenses, net | (186,258) | 18,822 | 210,823 | 20,999 |
(Loss) income before income taxes | (859,125) | (3,296) | (1,282,923) | 3,553 |
Income tax (benefit) expense | (48,650) | 118 | (6,244) | 118 |
Net (loss) income | $ (810,475) | $ (3,414) | $ (1,276,679) | $ 3,435 |
Net (loss) income per share (Note 14): | ||||
Net (loss) income per share – basic (in dollars per share) | $ (2.49) | $ (0.02) | $ (4.04) | $ 0.02 |
Net (loss) income per share – diluted (in dollars per share) | $ (2.49) | $ (0.02) | $ (4.04) | $ 0.02 |
Weighted average shares outstanding: | ||||
Weighted average common shares outstanding - basic (in shares) | 324,967 | 158,890 | 316,269 | 158,338 |
Weighted average common shares outstanding - diluted (in shares) | 324,967 | 158,890 | 316,269 | 177,342 |
Equipment Sales, Customers | ||||
Revenue: | ||||
Revenue from customers and related parties | $ 3,507 | $ 36,457 | $ 3,923 | $ 60,499 |
Hosting Service | ||||
Revenue: | ||||
Cost of revenue | 43,644 | 17,550 | 74,875 | 29,379 |
Hosting Service, Customers | ||||
Revenue: | ||||
Revenue from customers and related parties | 31,338 | 11,895 | 58,676 | 20,251 |
Equipment Sales, Related Parties | ||||
Revenue: | ||||
Revenue from customers and related parties | 11,687 | 9,519 | 37,576 | 17,403 |
Hosting Service, Related Parties | ||||
Revenue: | ||||
Revenue from customers and related parties | 7,598 | 6,667 | 13,474 | 11,003 |
Equipment Sales | ||||
Revenue: | ||||
Cost of revenue | 13,541 | 31,100 | 36,076 | 57,331 |
Digital asset mining | ||||
Revenue: | ||||
Digital asset mining revenue | 109,842 | 10,765 | 242,842 | 20,393 |
Cost of revenue | $ 94,070 | $ 2,115 | $ 162,820 | $ 3,768 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive (Loss) Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Statement of Other Comprehensive Income [Abstract] | ||||
Net (loss) income | $ (810,475) | $ (3,414) | $ (1,276,679) | $ 3,435 |
Other comprehensive income, net of income taxes: | ||||
Change in fair value attributable to instrument-specific credit risk of convertible notes measured at fair value under the fair value option, net of tax effect of $—, $—, $— and $— | 8,582 | 0 | 35,746 | 0 |
Total other comprehensive income, net of income taxes | 8,582 | 0 | 35,746 | 0 |
Comprehensive (loss) income | $ (801,893) | $ (3,414) | $ (1,240,933) | $ 3,435 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive (Loss) Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Statement of Other Comprehensive Income [Abstract] | ||||
Change in fair value attributable to instrument-specific credit risk of convertible notes measured at fair value under the fair value option, tax effect | $ 0 | $ 0 | $ 0 | $ 0 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Contingently Redeemable Convertible Preferred Stock and Stockholders' Equity - USD ($) $ in Thousands | Total | Previously Reported | Preferred stock | Preferred stock Previously Reported | Preferred stock Retroactive application of the recapitalization | Common Stock | Common Stock Previously Reported | Common Stock Retroactive application of the recapitalization | Additional Paid-in Capital | Additional Paid-in Capital Previously Reported | Additional Paid-in Capital Retroactive application of the recapitalization | Accumulated Deficit | Accumulated Deficit Previously Reported | Accumulated Other Comprehensive Income |
Beginning balance (in shares) at Dec. 31, 2020 | 10,826,000 | 6,766,000 | 4,060,000 | 157,786,000 | 98,607,000 | 59,179,000 | ||||||||
Beginning balance at Dec. 31, 2020 | $ 89,224 | $ 89,224 | $ 44,476 | $ 44,476 | $ 16 | $ 1 | $ 15 | $ 163,952 | $ 163,967 | $ (15) | $ (74,744) | $ (74,744) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net (loss) income | 3,435 | 3,435 | ||||||||||||
Other comprehensive income | 0 | |||||||||||||
Stock-based compensation | 2,724 | 2,724 | ||||||||||||
Issuances of common stock warrants and options (in shares) | 40,000 | |||||||||||||
Issuances of common stock- warrants and options | 496 | 496 | ||||||||||||
Ending balance (in shares) at Jun. 30, 2021 | 10,826,000 | 157,826,000 | ||||||||||||
Ending balance at Jun. 30, 2021 | 95,879 | $ 44,476 | $ 16 | 167,172 | (71,309) | |||||||||
Beginning balance (in shares) at Dec. 31, 2020 | 10,826,000 | 6,766,000 | 4,060,000 | 157,786,000 | 98,607,000 | 59,179,000 | ||||||||
Beginning balance at Dec. 31, 2020 | 89,224 | $ 89,224 | $ 44,476 | $ 44,476 | $ 16 | $ 1 | $ 15 | 163,952 | $ 163,967 | $ (15) | (74,744) | $ (74,744) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Costs attributable to issuance of common stock and equity instruments - Merger with XPDI | $ 16,600 | |||||||||||||
Ending balance (in shares) at Dec. 31, 2021 | 271,576,000 | 10,826,000 | 271,576,000 | |||||||||||
Ending balance at Dec. 31, 2021 | $ 1,341,210 | $ 44,476 | $ 27 | 1,379,581 | (27,432) | $ (10,966) | ||||||||
Beginning balance (in shares) at Mar. 31, 2021 | 10,826,000 | 157,786,000 | ||||||||||||
Beginning balance at Mar. 31, 2021 | 97,157 | $ 44,476 | $ 16 | 165,036 | (67,895) | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net (loss) income | (3,414) | (3,414) | ||||||||||||
Other comprehensive income | 0 | |||||||||||||
Stock-based compensation | 2,136 | 2,136 | ||||||||||||
Issuances of common stock warrants and options (in shares) | 40,000 | |||||||||||||
Ending balance (in shares) at Jun. 30, 2021 | 10,826,000 | 157,826,000 | ||||||||||||
Ending balance at Jun. 30, 2021 | $ 95,879 | $ 44,476 | $ 16 | 167,172 | (71,309) | |||||||||
Beginning balance (in shares) at Dec. 31, 2021 | 271,576,000 | 10,826,000 | 271,576,000 | |||||||||||
Beginning balance at Dec. 31, 2021 | $ 1,341,210 | $ 44,476 | $ 27 | 1,379,581 | (27,432) | (10,966) | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net (loss) income | (1,276,679) | (1,276,679) | ||||||||||||
Other comprehensive income | 35,746 | 35,746 | ||||||||||||
Stock-based compensation | 136,065 | 136,065 | ||||||||||||
Issuance of common stock- employee stock options (in shares) | 1,321,000 | |||||||||||||
Issuance of common stock - employee stock options | 3,846 | 3,846 | ||||||||||||
Issuance of common stock - restricted stock and restricted stock units (in shares) | 34,202,000 | |||||||||||||
Issuance of common stock - restricted stock and restricted stock units, net of shares withheld for tax withholding obligations | (29,277) | $ 4 | (29,281) | |||||||||||
Issuance of common stock - exercise of convertible notes (in shares) | 197,000 | |||||||||||||
Issuance of common stock - exercise of convertible notes | 1,574 | 1,574 | ||||||||||||
Issuance of common stock - exercise of warrants (in shares) | 3,001,000 | |||||||||||||
Conversion of contingently redeemable preferred stock to common stock (in shares) | (10,826,000) | 10,826,000 | ||||||||||||
Conversion of contingently redeemable preferred stock to common stock | 44,476 | $ (44,476) | $ 1 | 44,475 | ||||||||||
Issuances of common stock- Merger with XPDI (in shares) | 30,778,000 | |||||||||||||
Issuances of common stock - Merger with XPDI | 163,459 | $ 3 | 163,456 | |||||||||||
Issuances of common stock- vendor settlement (in shares) | 1,580,000 | |||||||||||||
Issuances of common stock - vendor settlement | 12,674 | 12,674 | ||||||||||||
Costs attributable to issuance of common stock and equity instruments - Merger with XPDI | $ (16,642) | (16,642) | ||||||||||||
Ending balance (in shares) at Jun. 30, 2022 | 353,481,000 | 353,481,000 | ||||||||||||
Ending balance at Jun. 30, 2022 | $ 416,452 | $ 35 | 1,695,748 | (1,304,111) | 24,780 | |||||||||
Beginning balance (in shares) at Mar. 31, 2022 | 324,564,000 | |||||||||||||
Beginning balance at Mar. 31, 2022 | 1,126,710 | $ 32 | 1,604,116 | (493,636) | 16,198 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net (loss) income | (810,475) | (810,475) | ||||||||||||
Other comprehensive income | 8,582 | 8,582 | ||||||||||||
Stock-based compensation | 115,492 | 115,492 | ||||||||||||
Issuance of common stock- employee stock options (in shares) | 1,321,000 | |||||||||||||
Issuance of common stock - employee stock options | 3,846 | 3,846 | ||||||||||||
Issuance of common stock - restricted stock and restricted stock units (in shares) | 27,399,000 | |||||||||||||
Issuance of common stock - restricted stock and restricted stock units, net of shares withheld for tax withholding obligations | (29,277) | $ 3 | (29,280) | |||||||||||
Issuance of common stock - exercise of convertible notes (in shares) | 197,000 | |||||||||||||
Issuance of common stock - exercise of convertible notes | $ 1,574 | 1,574 | ||||||||||||
Ending balance (in shares) at Jun. 30, 2022 | 353,481,000 | 353,481,000 | ||||||||||||
Ending balance at Jun. 30, 2022 | $ 416,452 | $ 35 | $ 1,695,748 | $ (1,304,111) | $ 24,780 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Cash flows from Operating Activities: | ||
Net (loss) income | $ (1,276,679) | $ 3,435 |
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 91,974 | 5,991 |
Amortization of operating lease right-of-use assets | 107 | 0 |
Stock-based compensation | 136,795 | 2,724 |
Digital asset mining revenue | (242,842) | (20,393) |
Deferred income taxes | (8,527) | 0 |
Gain on sale of intangible assets | (5,904) | 0 |
Loss on debt extinguishment | 0 | 8,016 |
Fair value adjustment on derivative warrant liabilities | (32,464) | 0 |
Fair value adjustment on convertible notes | 206,859 | 2,580 |
Fair value adjustment on other liabilities | 9,430 | 0 |
Amortization of debt discount and debt issuance costs | 3,920 | 742 |
Losses on exchange or disposal of property, plant and equipment | 13,057 | 17 |
Impairment of digital assets | 204,198 | 0 |
Impairment of goodwill and other intangibles | 790,753 | 0 |
Changes in working capital components: | ||
Accounts receivable, net | (1,458) | (6,800) |
Accounts receivable from related parties | (377) | (16,061) |
Digital assets | 232,278 | 20,207 |
Deposits for equipment for sales to customers | 36,953 | (260,568) |
Prepaid expenses and other current assets | (24,246) | 17,079 |
Accounts payable | 4,186 | 3,893 |
Accrued expenses and other | 33,297 | 3,267 |
Deferred revenue | 8,421 | 18,977 |
Deferred revenue from related parties | (36,022) | 116,908 |
Other noncurrent assets and liabilities, net | (2,436) | (21,345) |
Net cash provided by (used in) operating activities | 141,273 | (121,331) |
Cash flows from Investing Activities: | ||
Purchases of property, plant and equipment | (238,537) | (39,075) |
Deposits for self-mining equipment | (217,677) | 0 |
Proceeds from sale of intangibles | 10,850 | 0 |
Other | (276) | (142) |
Net cash used in investing activities | (445,640) | (39,217) |
Cash flows from Financing Activities: | ||
Proceeds from issuance of common stock, net of transaction costs | 198,857 | 496 |
Proceeds from debt, net of issuance costs | 216,257 | 245,372 |
Repurchase of common shares to pay employee withholding taxes | (29,278) | 0 |
Principal repayments of finance leases | (23,177) | 0 |
Principal payments on debt | (49,490) | (35,670) |
Net cash provided by financing activities | 313,169 | 210,198 |
Net increase in cash, cash equivalents and restricted cash | 8,802 | 49,650 |
Cash, cash equivalents and restricted cash—beginning of period | 131,678 | 8,721 |
Cash, cash equivalents and restricted cash—end of period | $ 140,480 | $ 58,371 |
ORGANIZATION AND DESCRIPTION OF
ORGANIZATION AND DESCRIPTION OF BUSINESS | 6 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND DESCRIPTION OF BUSINESS | 1. ORGANIZATION AND DESCRIPTION OF BUSINESS MineCo Holdings, Inc. was incorporated on December 13, 2017 in the State of Delaware and changed its name to Core Scientific, Inc. (“Legacy Core Scientific”) pursuant to an amendment to its Certificate of Incorporation dated June 12, 2018. On August 17, 2020 Legacy Core Scientific engaged in a holdco restructuring to facilitate a borrowing arrangement by Legacy Core Scientific pursuant to which Legacy Core Scientific was merged with and into a wholly owned subsidiary of Core Scientific Holding Co. and became a wholly owned subsidiary of Core Scientific Holding Co. and the stockholders of Legacy Core Scientific became the shareholders of Core Scientific Holding Co. On January 19, 2022, Core Scientific Holding Co. merged with Power & Digital Infrastructure Acquisition Corp., a Delaware corporation (“XPDI”), and XPDI Merger Sub Inc., a Delaware corporation and wholly owned subsidiary of XPDI (“Merger Sub”), consummated the transactions contemplated under the merger agreement, following the approval at the special meeting of the stockholders of XPDI held on January 19, 2022. In connection with the closing of the merger, XPDI changed its name from Power & Digital Infrastructure Acquisition Corp. to Core Scientific, Inc. (“Core Scientific” or the “Company”). The Company, headquartered in Austin, Texas, is an infrastructure, technology and services company that conducts, or plans to conduct, the following business activities: • Owning and operating computer equipment used to process transactions conducted on one or more blockchain networks in exchange for transaction processing fees rewarded in digital currency assets, commonly referred to as mining; • Owning and operating datacenter facilities in the U.S. to provide colocation and hosting services for distributed ledger technology, also commonly known as blockchain; • Developing blockchain-based platforms and applications, including infrastructure management, security technologies, mining optimization, and recordkeeping; Merger Agreement In 2021, XPDI entered into a certain Agreement and Plan of Reorganization and Merger, dated as of July 20, 2021, as amended on October 1, 2021, and as further amended on December 29, 2021, by and among Core Scientific Holding Co., XPDI Merger Sub and XPDI (the “Merger Agreement”). XPDI’s stockholders approved the transactions (collectively, the “Merger”) contemplated by the Merger Agreement at a special meeting of stockholders held on January 19, 2022 (the “Special Meeting”). Pursuant to the terms of (a) the Merger Agreement and (b) that certain Agreement and Plan of Merger, dated as of October 1, 2021, as amended on January 14, 2022, by and among XPDI, Core Scientific Holding Co., XPDI Merger Sub 3, LLC, a Delaware limited liability company and wholly owned subsidiary of XPDI (“Merger Sub 3”), and Blockcap, Inc., a Nevada corporation and wholly owned subsidiary of Core Scientific (“Blockcap”), the Merger was effected by (i) the merger of Merger Sub with and into Core Scientific (the “First Merger”), which occurred on January 19, 2022 (the “Closing Date”), with Core Scientific surviving the First Merger as a wholly owned subsidiary of XPDI, (ii) the merger of Core Scientific with and into XPDI (the “Second Merger”), which occurred on January 20, 2022, with XPDI surviving the Second Merger, and (iii) following the closing of the Second Merger on January 20, 2022, the merger of Blockcap with and into Merger Sub 3 (the “Third Merger”), with Merger Sub 3 surviving the Third Merger as a wholly owned subsidiary of XPDI under the name “Core Scientific Acquired Mining LLC.” Immediately prior to the effective time of the First Merger (such effective time of the First Merger, the “Effective Time”), XPDI filed a Second Amended and Restated Certificate of Incorporation (the “Post-Combination Charter”) with the Secretary of State of the State of Delaware pursuant to which XPDI changed its name from “Power & Digital Infrastructure Acquisition Corp.” to “Core Scientific, Inc.” (hereinafter referred to as the “Company” or “New Core”) and redesignated its Class A common stock, par value $0.0001 per share (“XPDI Class A Common Stock”), and Class B common stock, par value $0.0001 per share (“XPDI Class B Common Stock”), as common stock, par value $0.0001, of the Company (“New Core Common Stock”). The Exchange Ratio (as defined in the Merger Agreement) was 1.6001528688 of a share of New Core Common Stock per fully-diluted share of Core Scientific Common Stock. In connection with the Special Meeting and the Merger, holders of 12.3 million of the 34.5 million then-outstanding shares of Class A common stock of XPDI exercised their right to redeem their shares for cash at a redemption price of approximately $10.00 per share, for an aggregate redemption amount of $123.5 million. The Merger provided gross proceeds of approximately $221.6 million from the XPDI trust account, resulting in approximately $195.0 million in net cash proceeds to Core Scientific, after the payment of transaction expenses, which is presented within Proceeds from issuance of common stock, net of transaction costs on the consolidated statements of cash flows. Following the Transaction, former Core Scientific stockholders owned 90.7%, former XPDI public stockholders owned 6.7% and XPDI’s sponsor owned 2.6% of the issued and outstanding shares of common stock, respectively, of the Company, excluding the impact of unvested restricted stock units and options. The proceeds from the Merger were used to fund mining equipment purchases and infrastructure build-out. The Merger is accounted for as a reverse recapitalization with the Company being the accounting acquirer. A reverse recapitalization does not result in a new basis of accounting. Accordingly, the reverse recapitalization was treated as the equivalent of Core Scientific Holding Co. issuing stock for the net assets of XPDI, accompanied by a recapitalization. The net assets of XPDI are stated at historical costs, with no goodwill or other intangible assets recorded. The Company identified $18.6 million of direct and incremental transaction costs, which consist of legal, accounting, and other professional services directly related to the Merger, of which $10.7 million were recorded in other noncurrent assets on the consolidated balance sheets as of December 31, 2021 and the remaining $7.9 million were recognized in the six months ended June 30, 2022. These transaction costs have been allocated to all instruments assumed or issued in the merger on a relative fair value basis as of the date of the merger. Transaction costs of $16.6 million have been allocated to equity-classified instruments and recognized as an adjustment to additional paid-in Immediately prior to the Effective Time, each share of Series A convertible preferred stock, par value $0.00001, of Core Scientific automatically converted into one share of Core Scientific common stock, par value $0.00001 per share (“Core Scientific Common Stock”), and each share of Series B convertible preferred stock, par value $0.00001, of Core Scientific automatically converted into one share of Core Scientific Common Stock. In addition, immediately prior to the Effective Time, each share of XPDI Class B Common Stock automatically converted into one share of New Core Common Stock. 1.7 million shares (“SPAC Vesting Shares”) are subject to vesting conditions, and will vest i) upon the date on which New Core Common Stock’s volume-weighted average price is greater than $12.50 per share for any 20 trading days within any 30 consecutive trading day period within five years of the Closing Date or ii) upon any Company Sale that is consummated within five years of the Closing Date that results in the holders of the Company’s common stock receiving a Company Sale Price equal to or in excess of $12.50 per share. A Company Sale means any change in control of the Company, or a sale of substantially all of the Company’s assets that results in a change in control. Company Sale Price means the price per share paid to holders of common stock in a Company Sale. As a result of the Merger, all of XPDI’s Class A Common Stock and Class B Common Stock automatically converted into shares of New Core Common Stock on a one-for-one All share-based compensation awards were converted into comparable equity awards that are settled or exercisable for shares of New Core Common Stock. As a result, each stock option and warrant was converted into an option or warrant to purchase shares New Core Common Stock based on an exchange ratio of 1.6001528688. Each award of the Company’s restricted stock units (“RSUs”) was converted into RSUs of New Core based on an exchange ratio of 1.6001528688. Each convertible note is convertible into New Core Common Stock in accordance with the terms of such convertible promissory note; provided, however, that with respect to outstanding convertible promissory notes for which Core Scientific received a duly executed exercise of conversion in accordance with such convertible promissory note, exercising the right of such holder to convert such convertible promissory note subject to and conditioned upon the occurrence of the Effective Time, the outstanding principal amount and accrued interest as of the Effective Time with respect to such convertible promissory note was converted into shares of New Core Common Stock, equal to the product (rounded down to the nearest whole number) of (i) the number of shares of Core Scientific Common Stock issuable upon the conversion of such convertible promissory note in accordance with such convertible promissory note immediately prior to the Effective Time and (ii) the Exchange Ratio. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying consolidated financial statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the consolidated financial statements. Basis of Presentation We have prepared the accompanying consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. These consolidated financial statements are unaudited and, in our opinion, include all adjustments, consisting of normal recurring adjustments and accruals necessary for a fair presentation of our consolidated cash flows, operating results, and balance sheets for the periods presented. Operating results for the periods presented are not necessarily indicative of the results that may be expected for 2022. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted in accordance with the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes included as an exhibit to the amendment to the Current Report on Form 8-K/A, “8-K/A”). Use of Estimates The consolidated assets, liabilities and results of operations prior to the reverse recapitalization are those of Core Scientific Holding Co. The outstanding shares and corresponding capital amounts, and losses per share, prior to the reverse recapitalization, have been retroactively adjusted in accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income and expenses during the reporting period. Some of the more significant estimates include the valuation of the Company’s common shares and the determination of the grant date fair value of stock-based compensation awards for periods prior to the Merger, the valuation of goodwill and intangibles, the fair value of convertible debt, acquisition purchase price accounting, and income taxes. These estimates are based on information available as of Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents include all cash balances and highly liquid investments with original maturities of three months or less from the date of acquisition. As of June 30, 2022 and December 31, 2021, cash equivalents included $105.1 million and $100.0 million of highly liquid money market funds, respectively, which are classified as Level 1 within the fair value hierarchy. Restricted cash consists of cash held in escrow to pay for construction and development activities. The following table provides a reconciliation of the amount of cash, cash equivalents and restricted cash reported on the Consolidated Balance Sheets to the total of the same amount shown in the Consolidated Statements of Cash Flows (in thousands): June 30, 2022 December 31, 2021 Cash and cash equivalents $ 128,542 $ 117,871 Restricted cash 11,938 13,807 Total cash, cash equivalents and restricted cash $ 140,480 $ 131,678 Property, Plant and Equipment, Net Property, plant and equipment includes land, buildings and improvements for datacenter facilities and leasehold improvements for the Company’s corporate headquarters. Property and equipment consists of computer, mining, network, electrical and other equipment, including right-of-use Subsequent to January 1, 2022, future obligations related to finance leases are presented as Finance lease liabilities, current portion and Finance lease liabilities, net of current portion in the Company’s Consolidated Balance Sheets. Finance lease right-of-use right-of-use Prior to January 1, 2022, future obligations related to capital leases accounted for under ASC 840, Leases, Self-mining computer equipment that is subsequently contracted for sale to customers is valued at the lower Derivative Warrant Liabilities The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. The classification of derivative instruments, including whether such instruments should be classified as liabilities or as equity, is re-assessed The Public Warrants and the Private Placement Warrants are recognized as derivative liabilities. Accordingly, the Company recognizes the warrant instruments as liabilities at fair value and adjusts the instruments to fair value at each reporting period. The liabilities are subject to re-measurement Recently Adopted Accounting Standards Simplifying Income Taxes In December 2019 , (“ASU”) 2019-12 , Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, when year-to date not Leases In February 2016, the FASB issued ASU No. 2016-02, Leases-(Topic 842) right-of-use non-current right-of-use A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. The Company adopted the new standard on January 1, 2022 and used the effective date as the date of initial application. Consequently, financial information has not been updated, and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2022. The new standard provides a number of optional practical expedients in transition. The Company has elected the ‘package of use-of-hindsight The new standard also provides practical expedients for the Company’s ongoing accounting. The Company has elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, the Company does not recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. The Company has not elected to apply the practical expedient to not separate lease and non-lease The cumulative effect of initially applying the new lease standard on January 1, 2022 is as follows (in thousands): January 1, 2022 Beginning Balance Cumulative Effect Beginning Balance, Assets Prepaid expenses and other current assets $ 30,111 $ (453 ) $ 29,658 Other noncurrent assets $ 21,045 $ 1,814 $ 22,859 Liabilities Accrued expenses and other $ 67,862 $ (188 ) $ 67,674 Other noncurrent liabilities $ 18,531 $ (1,173 ) $ 17,358 The most significant judgments and impacts upon adoption of the standard include the following: • We recognized right-of-use right-of-use right-of-use • In determining the discount rate used to measure the right-of-use • Certain line items in the Consolidated Balance Sheets have been renamed to align with the new terminology presented in the new lease standard; “Capital lease obligations, current portion” and “Capital lease obligations, net of current portion” are now presented as “Finance lease liabilities, current portion” and “Finance lease liabilities, net of current portion” on the Consolidated Balance Sheets, respectively. • Upon adoption on January 1, 2022, Operating lease right-of-use Other noncurrent assets Sheets addition, upon adoption on January 1, 2022, the current portion of operating lease liabilities of $0.2 million were recorded in Accrued expenses and other and the noncurrent portion of operating lease liabilities of $1.2 million were recorded within Other noncurrent liabilities on the Consolidated Balance Sheets. Accounting Standards not yet adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Measurement of Credit Losses on Financial Instruments 10-K There are no other new accounting pronouncements that are expected to have a significant impact on the Company’s consolidated financial statements. |
ACQUISITIONS, DISPOSITIONS AND
ACQUISITIONS, DISPOSITIONS AND RESTRUCTURING | 6 Months Ended |
Jun. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITIONS, DISPOSITIONS AND RESTRUCTURING | 3. ACQUISITIONS, DISPOSITIONS AND RESTRUCTURING In June 2020, Core Scientific entered into an Asset Purchase Agreement with Atrio Inc. (“Atrio”) to acquire certain assets of Atrio in exchange for $1.2 million cash consideration and 0.5 million shares of the Company’s common stock. The Company and Atrio contemplated a valuation for the transaction of approximately $2.4 million based on an estimate of the fair value of the Company’s common stock of $2.19 per share which was allocated to cost of the acquired software intangible assets. In a separate transaction in June 2020, the Company entered into an agreement with RStor, Inc. (“RStor”) to obtain a non-exclusive license The software acquired from Atrio and the acquired patents from RStor are not businesses under ASC 805, Business Combinations, In March 2022, the Company reclassified $2.2 million of intangible assets related to the Atrio and RStor asset acquisitions to held for sale as a result of the expected sale of the software and related patents. The intangible assets were sold in June 2022 for proceeds of $10.9 million, resulting in a gain on sale of intangible assets of $5.9 million. The resulting gain is reflected within other non-operating Blockcap Acquisition On July 30, 2021, the Company acquired 100% of the equity interest in Blockcap, one of its largest hosting customers. Blockcap is a blockchain technology company with industrial scale digital asset mining operations. Blockcap’s primary historical business was the mining of digital asset coins and tokens, primarily Bitcoin and, to a lesser extent, Siacoin and Ethereum. While Blockcap did sell or exchange the digital assets it mined to fund its growth strategies or for general corporate purposes from time to time, it generally retained its digital assets as investments in anticipation of continued adoption of digital assets as a “store of value” and a more accessible and efficient medium of exchange than traditional fiat currencies. In addition to mining, holding and exchanging digital assets, Blockcap also evaluated and completed investments in related technologies and ancillary businesses, including Radar Relay, Inc. (“RADAR”), an early stage company focused on technology enhancement and development in the digital asset industry that it acquired on July 1, 2021. The acquisition of Blockcap significantly expanded the Company’s self-mining operations and increased the number of miners it owns. Consideration consisted of the issuance of 113.9 million shares of the Company’s common stock, approximately 6.8 million shares of the Company’s restricted stock and approximately 7.3 million options to purchase shares of the Company’s common stock. The acquisition has been accounted for as a business combination using the acquisition method of accounting, whereby the net assets acquired and the liabilities assumed were recorded at fair value. The Company and Blockcap had preexisting relationships which were settled on the acquisition date. Using the estimated purchase price for the transaction, the Company has allocated the purchase price to identifiable assets and liabilities based upon fair value estimates. The excess of the purchase price over the fair value of the net identifiable assets acquired was allocated to goodwill. In a business combination, the initial allocation of the purchase price is considered preliminary and therefore subject to change until the end of the measurement period (not to exceed one year from the acquisition date). During the three months ended June 30, 2022, we determined that a measurement period adjustment to the accounting for the Blockcap acquisition was necessary based upon obtaining updated information about property, plant and equipment, net acquired, resulting in an increase in fair value of property, plant and equipment, net of $0.7 million, a decrease in goodwill of $1.0 million and additional depreciation expense of $0.3 million recognized in the three months ended June 30, 2022. The measurement period for the Blockcap acquisition closed during the three months ended June 30, 2022. The following table summarizes the fair values for each major class of assets acquired and liabilities assumed at the acquisition date. The Company retained the services of certified valuation specialists to assist with assigning estimated values to certain acquired assets and assumed liabilities. Amounts initially disclosed for the estimated values of certain acquired assets and liabilities assumed were adjusted through June 30, 2022 based on information arising after the initial preliminary valuation. PPA Allocation Consideration (in thousands) 113.9 million common shares valued at $10.11 per share 1,2 $ 1,151,985 Fair value of replaced Blockcap share-based payments attributable to pre-combination 3 21,768 Settlement of Blockcap debt 4 25,607 Settlement of preexisting contracts 5 (60,522 ) Total Consideration $ 1,138,838 Fair value of assets acquired, and liabilities assumed: Cash and cash equivalents $ 704 Digital assets-Bitcoin 73,304 Digital assets-Ethereum 365 Digital assets-Bitcoin cash 8 Digital assets-Siacoin 554 Digital assets-Other 3,329 Other current assets 633 Intangible assets, net 2,925 Property, plant and equipment, net 98,965 Other noncurrent assets 1,293 Total assets acquired $ 182,080 Accounts payable 492 Accrued expenses and other 22,647 Deferred revenue 414 Other current liabilities 7,204 Deferred tax liability 9,003 Total liabilities assumed $ 39,760 Total identifiable net assets $ 142,320 Goodwill on acquisition $ 996,518 1 113.9 million common shares represent the equivalent Core Scientific common shares issued to Blockcap shareholders as consideration for the purchase. 2 The price per share of our common shares was estimated to be $10.11. As the Core Scientific common shares were not listed on a public marketplace, the calculation of the fair value of the common shares was subject to a greater degree of estimation. Given the absence of a public market, an estimate of the fair value of the common shares was required at the time of the Blockcap acquisition. Objective and subjective factors were considered in determining the estimated fair value and because there was no active trading of the Core Scientific equity shares on an established securities market, an independent valuation specialist was engaged. The valuation was determined by weighting the outcomes of scenarios estimating share value based on both public company valuations and private company valuations. Both a market approach and common stock equivalency model were used to determine a range of outcomes, which were weighted based on probability to determine the result. 3 Reflects the estimated fair value of replaced Blockcap share-based payments allocated to purchase price based on the proportion of service related to the pre-combination 4 Reflects the fair value of loans issued by the Company in July 2021 that were effectively used to settle debt that had previously been held by Blockcap. Refer to Note 6 for further discussion of the debt issuance. 5 Blockcap had preexisting hosting and equipment contracts with the Company that were effectively settled by the Company’s acquisition of Blockcap. As a result, the consideration transferred to Blockcap has been adjusted by the deferred revenue balances that were settled at the time of acquisition. For a reconciliation of the carrying amount of goodwill at the beginning and end of the reporting period see Note 4. Intangible Assets and Liabilities Goodwill with an assigned value of $1.00 billion represents the excess of the consideration transferred over the estimated fair values of assets acquired and liabilities assumed in the Blockcap acquisition. The goodwill recognized includes the assembled workforce of Blockcap and intangible assets that do not qualify for separate recognition. None of the goodwill resulting from the acquisition is deductible for income tax purposes. All of the goodwill acquired was allocated to the Mining segment. Management believes the acquisition of Blockcap strengthens its presence in the data mining market due to the scale of its operations. These factors are the basis for the excess purchase price paid over the value of the assets acquired and liabilities assumed, resulting in goodwill. Other intangible assets acquired in the Blockcap acquisition consisted of $2.8 million of developed technology intangibles and $0.1 million of customer relationships with a weighted average useful life of 3 years. 2022 Restructuring Current market conditions have led management to reevaluate operations and focus its efforts and resources on the core activities of its hosting and mining segments. During the three months ended June 30, 2022, management initiated a plan to exit certain activities, technologies and ancillary businesses, and to reduce portions of the Company’s workforce including those acquired through Blockcap’s acquisition of RADAR. Management anticipates that the restructuring will be complete by September 30, 2022. Relating to this restructuring plan, estimated cash severance payments under the Company’s ongoing severance policy of $1.4 million were accrued and expensed as compensation in general and administrative expenses during the three and six months ended June 30, 2022. As a result of exiting Blockchain Technologies, $2.0 million of intangible assets will cease to be used. Consequently, we recorded an impairment of other intangible assets of $2.0 million, which is presented within impairment of goodwill and other intangibles on the Company’s Consolidated Statements of Operations for the three and six months ended June 30, 2022. Goodwill associated with these activities is entirely impaired in the mining reporting unit goodwill impairment charge of $788.7 million. |
GOODWILL
GOODWILL | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL | 4. GOODWILL The following table provides the reconciliation of the carrying amount of goodwill by segment at the beginning and end of the reporting period (in thousands): Equipment Sales Mining Segment Total Goodwill Balance as of December 31, 2021 $ 58,241 $ 997,519 $ 1,055,760 Subsequent measurement period adjustment — (1,000 ) (1,000 ) Impairment of goodwill — (788,722 ) (788,722 ) Balance as of June 30, 2022 $ 58,241 $ 207,797 $ 266,038 As of June 30, 2022 and December 31, 2021, the carrying amount of goodwill was $266.0 million and $1.06 billion, respectively. There were $788.7 million of accumulated impairment losses as of June 30, 2022, and $788.7 million and no impairment losses were recorded for the six months ended June 30, 2022 and 2021, respectively. The Company does not amortize goodwill, but tests it for impairment annually as of October 31, or more frequently if events or changes in circumstances indicate that the carrying value of goodwill may not be recoverable. The Company has the option to first assess qualitative factors to determine whether it is more likely than not that the fair values of the reporting units are less than their carrying amounts as a basis for determining whether it is necessary to perform the quantitative goodwill impairment test. If management determines that it is more likely than not that the fair value of a reporting unit is less than the reporting unit’s carrying amount, or management chooses not to perform a qualitative assessment, then the quantitative goodwill impairment test will be performed. The quantitative test compares the fair value of the reporting unit with the reporting unit’s carrying amount. If the carrying amount exceeds its fair value, the excess of the carrying amount over the fair value is recognized as an impairment loss, and the resulting measurement of goodwill becomes its new cost basis. The Company’s reporting units are the same as its reportable and operating segments. The Company identified a triggering event as of June 30, 2022 due to a decline in the Company’s stock price and market decline in the value of bitcoin and, as such, the Company performed the quantitative test to compare the fair value to the carrying amount for each reporting unit. The Company concluded the carrying amount of the Mining reporting unit exceeded its fair value and, as such, recorded a $788.7 million impairment of goodwill in its Mining reporting unit, which is presented within impairment of goodwill and other intangibles on the Company’s Consolidated Statements of Operations. The Company concluded the fair value of the Equipment Sales and Hosting reporting unit exceeded its carrying amount, with an excess of fair value over carrying amount of approximately 136% of the carrying amount, and as such, did not record an impairment in its Equipment Sales and Hosting reporting unit. The Company’s analysis involved the use of a market approach and an income approach, with equal weighting given to both approaches. Valuations using the market approach are derived from metrics of publicly traded companies. A significant judgment in using the market approach includes the selection of comparable businesses based on the markets in which each reporting unit operates, with consideration of risk profiles, size, geography, and business operations. Significant assumptions used in the income approach include growth (revenue, earnings before interest, taxes, depreciation, and amortization (EBITDA) and earnings before interest and taxes (EBIT) margin, and terminal value) and discount rates, margins, capital expenditures, and the Company’s weighted average cost of capital. The Company used historical performance and management estimates of future performance to estimate margins and revenue growth rates. The Company’s growth rates and mining margins are impacted significantly by the future value of bitcoin. The income approach utilizes projected cash flow estimates developed by the Company to determine fair value, which are unobservable, Level 3 inputs. Unobservable inputs are used to measure fair value to the extent that relevant observable inputs are not available. The Company developed its estimates using the best information available at the time. The Company used discount rates that are commensurate with the risks and uncertainty inherent in the respective businesses. Assumptions used, such as forecasted growth rates, capital expenditures, and the Company’s cost of capital, are consistent with its internal projections and operating plans. Changes in management’s estimates or any of its other assumptions used in its analysis could result in a different conclusion. Further declines in the Company’s market capitalization or the deterioration of bitcoin’s value in the market could result in future goodwill impairments. |
DERIVATIVE WARRANT LIABILITIES
DERIVATIVE WARRANT LIABILITIES | 6 Months Ended |
Jun. 30, 2022 | |
Temporary Equity Disclosure [Abstract] | |
DERIVATIVE WARRANT LIABILITIES | 5. DERIVATIVE WARRANT LIABILITIES As of June 30, 2022, the Company had 14.9 million warrants outstanding including: (a) 8.6 million Public Warrants and (b) 6.3 million Private Placement Warrants issued to XPDI Sponsor LLC (“Sponsor”) and certain institutional investors (“Anchor Investors”). Each Public Warrant and Private Placement Warrant became exercisable 30 days following the Closing Date of the XPDI Merger and may be exercised for one share of common stock at an exercise price of $11.50 per share. The Public Warrants and Private Placement Warrants expire January 19, 2027, which is five years after the Closing Date. Redemption of Public Warrants when the price per share of common stock equals or exceeds $18.00 Once the warrants become exercisable, the Company may redeem the outstanding Public Warrants: • in whole and not in part; • at a price of $0.01 per warrant; • upon a minimum of 30 days’ prior written notice of redemption to each warrant holder; and • if, and only if, the last reported sale price of common stock for any 20 trading days within a 30-trading The Company will not redeem the warrants as described above unless a registration statement under the Securities Act covering the issuance of the shares of common stock issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of common stock is available throughout the 30-day Redemption of Public Warrants when the price per share of common stock equals or exceeds $10.00 Once the warrants become exercisable, the Company may redeem the outstanding Public Warrants: • in whole and not in part; • at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to an agreed table based on the redemption date and the “fair market value” (as defined below) of common stock; • if, and only if, the last reported sales price of the Company’s common stock for any twenty (20) trading days within the thirty (30) trading-day • if the Reference Value is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant), the Private Placement Warrants must also concurrently be called for redemption on the same terms as the outstanding Public Warrants, as described above. • The “fair market value” of common stock shall mean the volume-weighted average price of common stock during the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of warrants. In no event will the warrants be exercisable in connection with this redemption feature for more than 0.361 shares of Class A common stock per warrant (subject to adjustment). Redemption of Private Placement Warrants The terms of redemption of Private Placement Warrants are identical in all respects to those for the Public Warrants except that, so long as they are held by the Sponsor, Anchor Investors or their permitted transferees they will not be redeemable, except as described above in Redemption of Public Warrants when the price per share of common stock equals or exceeds $10.00. If the Private Placement Warrants are held by someone other than the Sponsor, the Anchor Investors or their respective permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. Registration If the Company fails to maintain a registration statement for the underlying common shares at any time, the holders of the Private Placement Warrants and Public Warrants may exercise such warrants on a cashless basis by exchanging the warrants for that number of shares of common stock equal to the lesser of (A) the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the Warrants, multiplied by the excess of the “Fair Market Value” (as defined below) less the Warrant Price by (y) the Fair Market Value and (B) the product of the number of Warrants surrendered and 0.361, subject to adjustment. “Fair Market Value” shall mean the volume-weighted average price of the shares of common stock as reported during the ten (10) trading day period ending on the trading day prior to the date that notice of exercise is received. Classification Both the Public Warrants and Private Placement Warrants are classified as a liability on the Company’s Consolidated Balance Sheet because their settlement amount is subject to change based on the existence of an effective registration statement for the underlying shares and the holder of the warrant (for Private Placement Warrants only). As of June 30, 2022, the liability balance was $5.8 million. For the three months ended June 30, 2022, the Company recorded a mark to market gain of $12.9 million and $9.3 million within the Consolidated Statement of Operations for the Public Warrants and Private Placement Warrants, respectively. For the six months ended June 30, 2022, the Company recorded a mark to market gain of $18.8 million and $13.7 million within the Consolidated Statement of Operations for the Public Warrants and Private Placement Warrants, respectively. Refer to Note 8 for further information about the fair value measurement of the warrants. |
NOTES PAYABLE
NOTES PAYABLE | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | 6. NOTES PAYABLE Notes payable as of June 30, 2022 and December 31, 2021 consist of the following (in thousands): June 30 December 31 Kentucky note $ 784 $ 1,032 Genesis loan — 552 NYDIG loan 48,642 67,435 Stockholder loan 10,000 10,000 Trinity loan 26,148 19,641 Bremer loan 20,116 15,066 Blockfi loan 60,652 60,000 Anchor Labs loan 30,016 — Mass Mutual Barings loans 65,550 — B. Riley Bridge Notes 75,000 — Liberty loan 8,676 — Secured Convertible Notes 1 227,528 220,871 Other Convertible Notes 2 308,753 301,226 Other 2,073 663 Total 883,938 696,486 Unamortized discount and debt issuance costs (4,214 ) (3,187 ) Fair value adjustment on convertible notes 190,273 34,910 Total notes payable, net $ 1,069,997 $ 728,209 1 Secured Convertible Notes (includes principal balance at issuance and PIK interest) which considers the minimum payoff at maturity of two times the face value of the note plus accrued interest. The minimum payoff at maturity related to the principal balance was $455.1 million on June 30, 2022. The minimum payoff at maturity related to the principal balance was $441.7 million on December 31, 2021. 2 Other Convertible Notes which considers the minimum payoff at maturity of one times the face value of the note plus accrued interest. Kentucky Note Genesis Loan NYDIG Loan In May 2021, the Company received $13.4 million of additional loans under the master equipment finance agreement with NYDIG to finance the Company’s acquisition of blockchain computing equipment that bear an interest rate of 14.25% and have a term of 24 months from issuance. Interest expense on the loans issued in May 2021 has been recognized based on an effective interest rate of 17%. In July 2021, the Company received blockchain computing equipment from NYDIG (which had been concurrently acquired by NYDIG from Blockcap in exchange for settlement of Blockcap’s debt with NYDIG) in exchange for $26.1 million of additional loans under the master equipment finance agreement with NYDIG that bear an interest rate of 14.25% and have a term of 24 months from issuance. Interest expense on the loans issued in July 2021 has been recognized based on an effective interest rate of 16%. In November 2021, the Company received blockchain computing equipment from NYDIG in exchange for $33.4 million of additional loans under the master equipment finance agreement with NYDIG that bear an interest rate of 11% and have a term of 24 months from issuance. Interest expense on the loans issued in November 2021 has been recognized based on an effective interest rate of 11%. Stockholder Loan a two-year term. a two-year term. Trinity Loan Bremer Loan following financial covenants: (1) a minimum debt service coverage ratio (defined in the agreement as EBITDA divided by scheduled principal and interest payments) of not less than 1.2:1, measured annually beginning December 31, 2022; and (2) a fixed charge coverage ratio (defined in the agreement as EBITDA minus net distributions divided by scheduled principal and interest payments) of 1:1, measured annually beginning December 31, 2022. The loans are secured by a first priority security interest in certain of the assets financed by the loans. Additionally, an interest buydown agreement was made between Grand Forks Growth Fund and the Bank of North Dakota acting on behalf of the PACE Program for the purpose of a buydown on the interest for certain of the Company’s loans financed through Bremer Bank. The total amount of interest buydown over the term of the loan is $0.8 million. In order to receive the interest buydown incentive, the Company must (a) continue operation in the jurisdiction for a minimum of five years from the benefit date, (b) employ 13 new full-time employees within two years of receiving the incentive and continue to keep them employed for the duration of the agreement and (c) continue to make debt payments and no event of default should occur. If the Company discontinues operation in the jurisdiction within the next five years, it is obligated to repay the incentive back to the Bank of North Dakota. If after two years, the Company does not employ 13 new full-time employees, the interest buydown will be prorated to reflect any partial fulfillment and the Company, at a minimum, is required to pay back the value of the incentive to the Bank of North Dakota. For the six months ended June 30, 2022 and 2021, there was no interest buydown. Blockfi Loan Anchor Labs Loan Mass Mutual Barings Loans B. Riley Bridge Notes Liberty Loan Convertible Notes payment-in-kind As discussed in Note 8, the Company has elected to measure its Convertible Notes at fair value and accordingly recognized $13.1 million of debt issuance costs as incurred at the time of issuance within interest expense, net in the Company’s Consolidated Statements of Operations and Comprehensive (loss) income. The Convertible Notes had a fair value of $726.6 million compared to a principal amount of $536.3 million at June 30, 2022. The Company presents changes in fair value of the Convertible Notes during the period as follows: (1) the 10% contractual rate of interest on the convertible notes (consisting of 4% cash interest and 6% PIK interest) is presented as interest expense, net on the Consolidated Statements of Operations; (2) changes in fair value attributable to the Company’s own credit risk are presented within accumulated other comprehensive loss on the Consolidated Balance Sheets and as a component of other comprehensive income on the Consolidated Statements of Comprehensive (Loss) Income; and (3) other fair value changes are presented within non-operating The fair value of the Company’s convertible notes as of December 31, 2021 included the effect of a negotiation discount, which is a calibration adjustment that reflects the illiquidity of the instruments and the Company’s negotiating position. Since the transaction was an orderly transaction, the Company deemed that the fair value equaled the transaction price at initial recognition. However, the closing of the merger of XPDI (which represents the occurrence of a qualified financing event as defined by the terms of the notes) in January 2022 resulted in the elimination of the negotiation discount instrument ended Financial statement line item Three Months Six Months Cash interest payments Interest expense, net $ 5,355 $ 10,582 Payment-in-kind Interest expense, net 8,032 15,883 Instrument-specific credit risk Other comprehensive income, net of income taxes (8,582 ) (35,746) Other fair value adjustments Fair value adjustment (195,061 ) 190,976 Total fair value adjustments $ (190,256 ) $ 181,695 Financial statement line item Three and Six Cash interest payments Interest expense, net $ 1,720 Payment-in-kind Interest expense, net 2,580 Instrument-specific credit risk Other comprehensive income, net of income taxes — Other fair value adjustments Fair value adjustment on convertible notes — Total fair value adjustments $ 4,300 Debt issuance costs Interest expense, net $ 5,581 The principal amount of the Convertible |
REVENUE
REVENUE | 6 Months Ended |
Jun. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | 7. REVENUE The Company primarily generates revenue from hosting services, sales of computer equipment and digital asset mining revenue. The Company generally recognizes revenue when the promised service is performed, or control of the promised equipment is transferred to customers. Revenue excludes any amounts collected on behalf of third parties, including sales and indirect taxes. Deferred Revenue The Company records contract liabilities in deferred revenue on the Consolidated Balance Sheets when cash payments are received in advance of performance and recognizes them as revenue when the performance obligations are satisfied. The Company’s deferred revenue balance as of June 30, 2022 and December 31, 2021 was $108.8 million and $136.4 million, respectively, all from advance payments received during the periods then ended. For the three and six months ended June 30, 2022, the Company recognized $3.9 million and $40.7 million of revenue, respectively, that was included in the deferred revenue balance as of the beginning of the year, primarily due to the deployment of customer equipment for which advanced payment had been received from customers prior to January 1, 2022. For the three and six months ended June 30, 2021, the Company recognized $8.9 million and $35.8 million of revenue, respectively, that was included in the deferred revenue balance as of the beginning of the year, primarily due to deployment of customer equipment for which advance payments had been received from customers prior to January 1, 2021. Advanced payments received for hosting services are typically recognized as revenue within six months and advanced payments received for equipment sales are generally recognized as revenue within one year. Performance Obligations The Company’s performance obligations primarily relate to hosting services and equipment sales. The Company has performance obligations associated with commitments in customer hosting contracts for future services and commitments to acquire and deploy customer equipment that have not yet been recognized in the financial statements. For contracts with original terms that exceed one year (typically ranging from 18 to 48 months), those commitments not yet recognized as of June 30, 2022 and 2021 were $900.8 million and $427.5 million, respectively. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | 8. FAIR VALUE MEASUREMENTS The Company measures certain assets and liabilities at fair value on a recurring or non-recurring basis Level 1—Valuations based on quoted prices for identical assets and liabilities in active markets. Level 2—Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. Level 3—Valuations based on unobservable inputs reflecting the Company’s own assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment. The Company uses observable market data when determining fair value whenever possible and relies on unobservable inputs only when observable market data is not available. Recurring fair value measurements The Public Warrants and the Private Placement Warrants are recognized as derivative liabilities in accordance with ASC 815, Derivatives and Hedging The Company has elected to measure its Convertible Notes at fair value on a recurring basis because the Company believes it better reflects the underlying economics of the Convertible Notes, which contain multiple embedded derivative features. The fair value of the Company’s convertible notes payable is determined using a market approach based on observable market prices for similar securities when available. Prior to the three months ended June 30, 2022, when observable market data was not available, the Company used an as-converted Due to the occurrence of the SPAC merger and the subsequent significant decline in the Company’s stock price below the conversion price, the fair value of the Company’s convertible notes for the three months ended June 30, 2022 was determined using a discounted cash flow model that considers the principal and interest payments, including the minimum payoff at maturity of two times the face value of the note plus accrued interest for the Secured Convertible Notes and the value of the call option that includes certain unobservable inputs that may be significant to the fair value measurement such as expected term and volatility of the call option. This The following presents the levels of the fair value hierarchy for the Company’s derivative warrant liabilities and the Convertible Notes by issuance date measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021 (in thousands): June 30, 2022 Fair value hierarchy Principal Level 1 Level 2 Level 3 Fair value Derivative warrant liabilities: Public Warrants $ — $ 3,364 $ — $ — $ 3,364 Private Placement Warrants — — 2,444 — 2,444 Total derivative warrant liabilities — 3,364 2,444 — 5,808 Convertible notes: April 19, 2021 1 $ 94,186 $ — $ — $ 172,610 $ 172,610 April 21, 2021 1 5,291 — — 9,697 9,697 April 23, 2021 1 47,622 — — 87,275 87,275 April 26, 2021 1 80,429 — — 147,398 147,398 August 20, 2021 2 52,122 — — 49,635 49,635 September 10, 2021 2 15,559 — — 15,272 15,272 September 23, 2021 2 77,825 — — 76,393 76,393 September 24, 2021 2 61,825 — — 60,687 60,687 September 27, 2021 2 2,034 — — 1,996 1,996 October 1, 2021 2 89,269 — — 87,627 87,627 November 10, 2021 2 10,119 — — 9,933 9,933 Accrued PIK interest 1,2,3 — — — 8,031 8,031 Total convertible notes 536,281 — — 726,554 726,554 Total liabilities measured at fair value on a recurring basis $ 536,281 $ 3,364 $ 2,444 $ 726,554 $ 732,362 December 31, 2021 Fair value hierarchy Principal Level 1 Level 2 Level 3 Fair value Convertible notes: April 19, 2021 1 $ 91,430 $ — $ — $ 101,078 $ 101,078 April 21, 2021 1 5,137 — — 5,674 5,674 April 23, 2021 1 46,229 — — 51,062 51,062 April 26, 2021 1 78,075 — — 86,165 86,165 August 20, 2021 2 50,597 — — 50,941 50,941 September 10, 2021 2 16,110 — — 16,472 16,472 September 23, 2021 2 76,051 — — 77,559 77,559 September 24, 2021 2 60,016 — — 61,179 61,179 September 27, 2021 2 1,974 — — 2,012 2,012 October 1, 2021 2 86,655 — — 87,150 87,150 November 10, 2021 2 9,823 — — 9,819 9,819 Accrued PIK interest 1,2,4 — — — 7,896 7,896 Total convertible notes $ 522,097 $ — $ — $ 557,007 $ 557,007 1 Secured Convertible Notes (includes principal balance at issuance and PIK interest) which considers the minimum payoff at maturity of two times the face value of the note plus accrued interest. 2 Other Convertible Notes (other than the Secured Convertible notes) which considers the minimum payoff at maturity of one times the face value of the note plus accrued interest. 3 Represents PIK interest accrued as of June 30, 2022 which will be recorded as additional principal for each respective convertible note on July 1, 2022. 4 Represents PIK interest accrued as of December 31, 2021 which will be recorded as additional principal for each respective convertible note on January 1, 2022. Level 3 Recurring Fair Value Measurements The following presents a rollforward of the activity for the Convertible Notes measured at fair value on a recurring basis using level 3 inputs as of June 30, 2022 (in thousands): Convertible (Level 3) Balance at December 31, 2021 $ 557,007 Issuances (including PIK principal recorded) 7,896 Settlements (including interest payments, PIK principal recorded and conversions) (13,123 ) Unrealized losses 371,951 Balance at March 31, 2022 923,731 Issuances (including PIK principal recorded) 7,851 Settlements (including interest payments, PIK principal recorded and conversions) (14,772 ) Unrealized gains (190,256 ) Balance at June 30, 2022 $ 726,554 Securities are transferred from level 2 to level 3 when observable market prices for similar securities are no longer available and unobservable inputs become significant to the fair value measurement. All transfers into and out of level 3 are assumed to occur at the beginning of the quarterly reporting period in which they occur. As of June 30, 2022, level 3 financial instruments included all the Convertible Notes as the effect of unobservable inputs are significant to the fair value measurement. There were no transfers of securities into or out of level 3 for the three and six months ended June 30, 2022 and 2021. The following presents significant Level 3 unobservable inputs used to measure the fair value of certain convertible notes as of June 30, 2022 (dollars in thousands): Fair value Unobservable Input Low High Weighted 1 Convertible Notes $ 726,554 Expected term (years) 2.80 2.80 2.80 Volatility 46.3 % 46.3 % 46.3 % 1 Weighted average based on the fair value of convertible notes. Expected term is an input into the call option model that measures the length of time the instrument is expected to be outstanding before it is exercised or terminated. An increase in expected term, in isolation, would generally result in an increase in the fair value measurement of the convertible notes. Volatility is an input into the call option model that measures the variability in possible returns for the convertible notes based on how much the price of underlying shares change in value over time. An increase in volatility, in isolation, would generally result in an increase in the fair value measurement of the convertible notes. The increase or decrease in the fair value of the convertible notes resulting from changes to the expected term or volatility assumptions are not interrelated. The Company presents separately in other comprehensive income (loss) the portion of the total change in the fair value of the convertible notes that resulted from a change in the instrument-specific credit risk on the convertible notes. The amount of change in the fair value attributable to instrument-specific credit risk is determined by comparing the amount of the total change in fair value to the amount of change in fair value that would have occurred if the Company’s credit risk had not changed during the period as reflected in the discount rates applied to the debt and risk put option. Nonrecurring fair value measurements The Company’s non-financial assets, Property, plant and equipment On March 10, 2022, the Company entered into an agreement to sell mining equipment on order with a 3rd party supplier to a hosting customer in exchange for the Company receiving ownership of the customer’s mining equipment that had been hosted by the Company on its premises (the “Installed Miners”). The primary purpose of the exchange was to allow for the mutual termination of the hosting agreements in a manner that avoids the logistical costs and loss of revenue from downtime associated with relocating and installing the mining equipment. The exchange began during the three months ended June 30, 2022 and was completed in July 2022 as ordered mining equipment was received and exchanged for the Installed Miners. The agreement also includes the termination of the hosting agreement between the Company and the customer as ownership of the Installed Miners is transferred to the Company. The Company recognized losses of $13.1 million on the exchanges during the three and six months ended June 30, 2022, which are presented within Losses on exchange or disposal of property, plant and equipment on the Consolidated Statements of Operations. The amount of the losses was measured as the difference between the fair value of the installed miners and the carrying value of the deposits for mining equipment to be exchanged. The fair value of the installed miners is classified as a Level 2 fair value measurement and was determined as of contract inception (March 10, 2022) using a cost approach. The replacement cost of the installed miners was estimated through a review of vendor equipment pricing of similar equipment. Physical deterioration was also considered and estimated based on an age/life analysis indicative of a market participant’s anticipated economic useful life for the assets. Goodwill and other intangibles On June 30, 2022, we evaluated our Mining reporting unit for impairment and recorded an impairment of goodwill and other intangibles of $790.8 million to adjust the carrying value of the reporting unit to the estimated fair value. Refer to Note 4 for additional information regarding the inputs and methodology used to estimate the fair value. Digital Assets The Company classifies digital assets primarily as level 1. The Company’s digital assets are accounted for as intangible assets with indefinite useful lives. The Company initially recognizes digital assets that are received as digital asset mining revenue based on the fair value of the digital assets. Digital assets that are purchased in an exchange of one digital asset for another digital asset are recognized at the fair value of the asset surrendered or at the fair value of the asset received if more readily apparent. Impairment exists when the carrying amount exceeds its fair value, which is measured using the quoted price of the digital asset at the time its fair value is being measured, which is measured once a day at 00:00 Coordinated Universal Time (“UTC”). To the extent that an impairment loss is recognized, the loss establishes the new cost basis of the digital asset. During the three and six months ended June 30, 2022, the Company recognized impairment of digital assets of $150.2 million and $204.2 million, respectively. During the three and six months ended June 30, 2021, the Company did not have any impairment of digital assets. For the three and six months ended June 30, 2022, the Company recognized net gains of $11.8 million and $14.0 million, respectively, from sales of digital assets. For the three and six months ended June 30, 2021, the Company recognized nominal losses and gains, respectively, from sales of digital assets. Digital assets are available for use, if needed, for current operations and are classified as current assets on the Consolidated Balance Sheets, the details of which are presented below (in thousands). June 30 December 31 Bitcoin (BTC) $ 37,646 $ 224,843 Ethereum (ETH) 1,200 4,665 Polygon (MATIC) 182 1,085 Siacoin (SC) — 803 Dai (DAI) — 1,353 Other 1,636 1,549 Total digital assets $ 40,664 $ 234,298 The Company does not have any off-balance No non-financial assets Fair value of financial instruments The Company’s financial instruments include cash and cash equivalents, restricted cash, accounts receivable, net, accounts payable, notes payable and certain accrued expenses and other liabilities. The carrying amount of these financial instruments, other than notes payable discussed below, approximates fair value due to the short-term nature of these instruments. The fair value of the Company’s notes payable (excluding the Convertible Notes carried at fair value described above), which are carried at amortized cost, was determined based on a discounted cash flow approach using market interest rates of instruments with similar terms and maturities and an estimate for our standalone credit risk. We classified the other notes payable as Level 3 financial instruments due to the considerable judgment required to develop assumptions of the Company’s standalone credit risk and the significance of those assumptions to the fair value measurement. The estimated fair value of the Company’s other notes payable, including both the current and noncurrent portion, was $350.3 million at June 30, 2022 and $184.7 million at December 31, 2021. The carrying values of the notes payable, including both the current and noncurrent portion, was $343.4 million and $171.2 million at June 30, 2022 and December 31, 2021, respectively. |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
LEASES | 9. LEASES Lessee The Company has entered into non-cancellable right-of-use right-of-use The components of operating and finance leases are presented on the Company’s Consolidated Balance Sheets as follows (in thousands): Financial statement line item June 30, 2022 Assets: Operating lease right-of-use Other noncurrent asset $ 6,401 Finance lease right-of-use Property, plant and equipment, ne $ 97,655 Liabilities: Operating lease liabilities, current portion Accrued expenses and othe $ 75 Operating lease liabilities, net of current portion Other noncurrent liabilitie $ 1,127 Finance lease liabilities, current portion Finance lease liabilities, current portion $ 28,570 Finance lease liabilities, net of current portion Finance lease liabilities, net of current portion $ 48,701 The components of lease expense were as follows (in thousands): Financial statement line item Three Months Ended Six Months Ended Operating lease expense General and administrative expenses $ 154 $ 309 Short-term lease expense General and administrative expenses 287 477 Finance lease expense: Amortization of right-of-use Cost of revenue 8,699 18,523 Interest on lease liabilities Interest expense, net 2,248 4,339 Total finance lease expense 10,947 22,862 Total lease expense $ 11,388 $ 23,648 In determining the discount rate used to measure the right-of-use Information relating to the lease term and discount rate is as follows: June 30, 2022 Weighted Average Remaining Lease Term (Years) Operating leases 21.5 Finance leases 2.5 Weighted Average Discount Rate Operating leases 6.4 % Finance leases 11.0 % The following table summarizes the Company’s supplemental cash flow information (in thousands): Three Months Ended Six Months Ended Lease Payments Operating lease payments $ 101 $ 202 Finance lease payments $ 15,169 $ 27,526 Supplemental Noncash Information Operating lease right-of-use $ — $ — Finance lease right-of-use $ — $ 10,557 The Company’s minimum payments under noncancelable operating and finance leases having initial terms and bargain renewal periods in excess of one year are as follows at June 30, 2022, and thereafter (in thousands): Operating leases Finance leases Remaining 2022 $ 69 $ 18,131 2023 170 34,948 2024 170 31,332 2025 170 4,509 2026 170 3 2027 170 — Thereafter 1,251 — Total lease payments 2,170 88,923 Less: imputed interest 968 11,652 Total $ 1,202 $ 77,271 Operating leases In September 2021, the Company entered into operating lease agreements with Minnkota Power Cooperative to develop a hosting facility in Grand Forks, North Dakota as well as enter into a power supply purchase agreement to purchase 100 megawatts of power supply once construction of the hosting facility is complete. As a result of the agreements being entered into contemporaneously and in contemplation of one another, the agreements are considered to be a single unit of account and consideration has been allocated between lease and non-lease non-lease Substantially all of the payments for the intended leases would be for a five-year to thirty-year term (comprising an initial five-year five five-year In addition to the above, in December 2021, the Company entered into an agreement to lease office space for its new corporate headquarters that commenced in July of 2022. The lease includes base rent of approximately $14.0 million to be paid over a period of 130 months. Finance leases In December 2021, the Company entered into finance lease agreements with Liberty Commercial Finance LLC totaling $40.9 million for the purchase of bitcoin mining equipment, with a weighted average term of 3.2 years. The leases bear interest at a weighted average rate per annum of 12.6% and the Company is required to make monthly payments of principal and interest. Interest expense on the lease has been recognized based on a weighted average effective interest rate of 12.6%. In December 2021, the Company entered into finance lease agreements with MassMutual Asset Finance LLC totaling $50.0 million for the purchase of bitcoin mining equipment, with a weighted average term of 3.2 years. The leases bear interest at a rate per annum of 10% and the Company is required to make monthly payments of principal and interest. Interest expense on the leases has been recognized based on an effective interest rate of 10%. |
LEASES | 9. LEASES Lessee The Company has entered into non-cancellable right-of-use right-of-use The components of operating and finance leases are presented on the Company’s Consolidated Balance Sheets as follows (in thousands): Financial statement line item June 30, 2022 Assets: Operating lease right-of-use Other noncurrent asset $ 6,401 Finance lease right-of-use Property, plant and equipment, ne $ 97,655 Liabilities: Operating lease liabilities, current portion Accrued expenses and othe $ 75 Operating lease liabilities, net of current portion Other noncurrent liabilitie $ 1,127 Finance lease liabilities, current portion Finance lease liabilities, current portion $ 28,570 Finance lease liabilities, net of current portion Finance lease liabilities, net of current portion $ 48,701 The components of lease expense were as follows (in thousands): Financial statement line item Three Months Ended Six Months Ended Operating lease expense General and administrative expenses $ 154 $ 309 Short-term lease expense General and administrative expenses 287 477 Finance lease expense: Amortization of right-of-use Cost of revenue 8,699 18,523 Interest on lease liabilities Interest expense, net 2,248 4,339 Total finance lease expense 10,947 22,862 Total lease expense $ 11,388 $ 23,648 In determining the discount rate used to measure the right-of-use Information relating to the lease term and discount rate is as follows: June 30, 2022 Weighted Average Remaining Lease Term (Years) Operating leases 21.5 Finance leases 2.5 Weighted Average Discount Rate Operating leases 6.4 % Finance leases 11.0 % The following table summarizes the Company’s supplemental cash flow information (in thousands): Three Months Ended Six Months Ended Lease Payments Operating lease payments $ 101 $ 202 Finance lease payments $ 15,169 $ 27,526 Supplemental Noncash Information Operating lease right-of-use $ — $ — Finance lease right-of-use $ — $ 10,557 The Company’s minimum payments under noncancelable operating and finance leases having initial terms and bargain renewal periods in excess of one year are as follows at June 30, 2022, and thereafter (in thousands): Operating leases Finance leases Remaining 2022 $ 69 $ 18,131 2023 170 34,948 2024 170 31,332 2025 170 4,509 2026 170 3 2027 170 — Thereafter 1,251 — Total lease payments 2,170 88,923 Less: imputed interest 968 11,652 Total $ 1,202 $ 77,271 Operating leases In September 2021, the Company entered into operating lease agreements with Minnkota Power Cooperative to develop a hosting facility in Grand Forks, North Dakota as well as enter into a power supply purchase agreement to purchase 100 megawatts of power supply once construction of the hosting facility is complete. As a result of the agreements being entered into contemporaneously and in contemplation of one another, the agreements are considered to be a single unit of account and consideration has been allocated between lease and non-lease non-lease Substantially all of the payments for the intended leases would be for a five-year to thirty-year term (comprising an initial five-year five five-year In addition to the above, in December 2021, the Company entered into an agreement to lease office space for its new corporate headquarters that commenced in July of 2022. The lease includes base rent of approximately $14.0 million to be paid over a period of 130 months. Finance leases In December 2021, the Company entered into finance lease agreements with Liberty Commercial Finance LLC totaling $40.9 million for the purchase of bitcoin mining equipment, with a weighted average term of 3.2 years. The leases bear interest at a weighted average rate per annum of 12.6% and the Company is required to make monthly payments of principal and interest. Interest expense on the lease has been recognized based on a weighted average effective interest rate of 12.6%. In December 2021, the Company entered into finance lease agreements with MassMutual Asset Finance LLC totaling $50.0 million for the purchase of bitcoin mining equipment, with a weighted average term of 3.2 years. The leases bear interest at a rate per annum of 10% and the Company is required to make monthly payments of principal and interest. Interest expense on the leases has been recognized based on an effective interest rate of 10%. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 10. COMMITMENTS AND CONTINGENCIES Legal Proceedings Leases Purchase obligations— |
CONTINGENTLY REDEEMABLE CONVERT
CONTINGENTLY REDEEMABLE CONVERTIBLE PREFERRED STOCK | 6 Months Ended |
Jun. 30, 2022 | |
Equity [Abstract] | |
CONTINGENTLY REDEEMABLE CONVERTIBLE PREFERRED STOCK | 11. CONTINGENTLY REDEEMABLE CONVERTIBLE PREFERRED STOCK The Company is authorized to issue 2.00 billion shares of preferred stock, $0.0001 as of June 30, 2022. Prior to the Merger with XPDI, the Company was authorized to issue 50.0 million, shares of preferred stock, $0.0001 par value. As of December 31, 2021, 10.8 million shares of preferred stock were issued and outstanding. Upon the closing of the merger with XPDI on January 19, 2022, each share of Series A and Series B Preferred Stock automatically converted into one share of Core Scientific common stock and each outstanding share of common stock issued as a result of the conversion of Series A and Series B Preferred Stock in connection with the Merger was cancelled and extinguished and converted into the right to receive a number of shares of New Core Common Stock equal to the Exchange Ratio of 1.6001528688. All of the Company’s shares of contingently redeemable convertible preferred stock were converted into 10.8 million shares of the Company’s common stock during the six months ended June 30, 2022 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2022 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | 12. STOCKHOLDERS’ EQUITY Authorized Capital— In January 2021, in connection with the stockholder loan described in Note 6, the Company issued a warrant to the stockholder to purchase up to 0.2 million shares of common stock at an exercise price of $4.21 per share. The warrant is set to expire in January 2023 and is exercisable and unexercised as of June 30, 2022. As a result of the Business Combination, all of XPDI’s Class A Common Stock and Class B Common Stock automatically converted into 30.8 million shares of New Core Common Stock on a one-for-one Following the Merger with XPDI, each share of common stock or warrant was converted to shares of New Core Common Stock or a warrant to purchase shares of New Core Common Stock based on an exchange ratio of 1.6001528688. Warrant Exercises In March 2020, the Company issued warrants to the Company’s president and chief executive officer and a member of the board of directors to purchase up to 6.4 million shares of the Company’s common stock at an exercise price of $0.84 per share (as amended). In March 2022, a warrant holder exercised their warrant to purchase 3.2 million shares in a cashless exercise resulting in 2.9 million net shares issued to the warrant holder after withholding 0.3 million shares for the exercise price. In March 2020, the Company issued warrants to service providers in exchange for services provided related to the issuance of Series A Convertible Preferred Stock. The warrants were for an aggregate of 0.2 million shares at an exercise price of $4.27 per share. In February 2022, 0.2 million of the warrants were exercised in a cashless exercise resulting in 0.1 million net shares issued to the warrant holders. Convertible Note Exercises As discussed in Note 6, the Company issued $514.8 million of Convertible Notes in 2021 along with issuing an additional $23.0 million from issuance through June 30, 2022 as payment-in-kind SPAC Vesting Shares 1.7 million common shares are subject to vesting requirements, as described further in Note 1. These contingently issuable shares do not require future service in order to vest and do not result in stock-based compensation expense. The SPAC Vesting Shares are accounted for as an equity contract, and meet the criteria for equity classification. The Company has recorded the SPAC Vesting Shares within additional paid-in Vendor Settlement In March 2022, the Company issued 1.6 million shares of the Company’s common stock related to a vendor liability that had been assumed by the Company in July 2021 as part of the Blockcap acquisition. In addition, the vendor liability includes requires settlement in cash based on the difference between the weighted average of the closing price of the Company’s common stock for each day there was a closing price during the thirty non-operating Equity Incentive Plans The Company has outstanding awards under the 2018 Omnibus Incentive Plan (the “2018 Plan”). No new awards can be made under the 2018 Plan subsequent to the XPDI Merger, as described below. Awards that were granted under the 2018 Plan included incentive stock options (must meet all statutory requirements), non-qualified In July 2021, the Company acquired Blockcap. Under the terms of the Blockcap merger agreement, (i) each stock option granted, whether vested or unvested, and each award of restricted stock under the Blockcap, Inc. Equity Incentive Plan (the “Legacy Blockcap Plan”) was assumed by the Company. In addition, the Radar Relay, Inc. Amended and Restated 2018 Equity Incentive Plan (the “RADAR Plan”) provides for the grant of stock options, restricted stock awards, and other awards to eligible employees, non-employee At the Special Meeting in connection with the XPDI Merger, the stockholders of XPDI approved the Core Scientific, Inc. 2021 Equity Incentive Plan (the “2021 Plan”). Awards granted under the 2021 Plan may be incentive stock options (must meet all statutory requirements), non-qualified stock must be granted with exercise prices of no less than the fair value of the common stock on the grant date, as determined by the Company’s board of directors. Following the consummation of the Merger, the Company expects that its board of directors will make grants of awards under the Incentive Plan to eligible participants. The maximum number of shares of the Company’s common stock that may be issued under the 2021 Plan is 45.0 million shares, of which 43.0 million was available for issuance as of June 30, 2022. Stock-Based Compensation Stock-based compensation expense relates primarily to expense for restricted stock awards (“RSAs”), restricted stock units (“RSUs”), and stock options. As of June 30, 2022, we had unvested or unexercised stock-based awards outstanding representing approximately 82.7 million shares of our common stock, consisting of approximately 52.1 million RSAs and RSUs and options to purchase approximately 30.6 million shares of our common stock with a weighted average exercise price of $9.02 and weighted average expense amortization period of 3.4 years. On June 8, 2022, the compensation committee (the “Compensation Committee”) of the board of directors (the “Board”) of the Company approved an amendment to the Company’s award agreement for the RSUs outstanding under the 2018 Plan, to provide for the waiver and elimination of the requirement that the Company undergo a “change in control” or a “public offering” for full vesting of the previously outstanding time-vested award (the “RSU Amendment”). Although the mergers that the Company underwent did not satisfy the event-based vesting requirement, they significantly reduced the possibility of the requirement being met as contemplated under the 2018 Plan. The RSU Amendment was authorized and approved by the Board and the Compensation Committee as necessary, desirable, and in the best interest of the Company and its stockholders. As a result of the RSU Amendment, all outstanding RSUs under the 2018 Plan are subject only to time-based vesting, of which RSUs covering approximately 42 million shares of Common Stock were net settled, with approximately 15 million shares of Common Stock to be canceled and forfeited to satisfy tax withholding obligations. During the three and six months ended June 30, 2022, the Company granted 2.1 million and 14.0 million restricted stock units, respectively, to various employees and directors with a weighted-average grant date fair value (reflecting the RSU Amendment described above) of $5.45 and $2.78 per share, respectively. Stock-based compensation expense for the three and six months ended June 30, 2022 and 2021 is included in the Company’s Consolidated Statements of Operations and Comprehensive (Loss) Income as follows (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Cost of revenue $ 16,882 $ — $ 18,921 $ — Research and development 13,177 — 15,059 — Sales and marketing 9,132 — 9,590 — General and administrative 71,807 2,136 93,225 2,724 Total stock-based compensation expense $ 110,998 $ 2,136 $ 136,795 $ 2,724 As of June 30, 2022, total unrecognized stock-based compensation expense related to unvested stock options was approximately $131.4 million, which is expected to be recognized over a weighted average time period of 3.4 years. As of June 30, 2022, the Company had approximately $136.8 million of unrecognized stock-based compensation expense related to RSAs and RSUs, which is expected to be recognized over a weighted average time period of 3.0 years. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 13. INCOME TAXES Current income tax expense represents the amount expected to be reported on the Company’s income tax returns, and deferred tax expense or benefit represents the change in net deferred tax assets and liabilities. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities as measured appropriate tax amount The income tax (benefit) expense and effective income tax rate for the three and six months ended June 30, 2022 and 2021 were as follows: Three Months Ended Six Months Ended 2022 2021 2022 2021 (in thousands, except percentages) Income tax (benefit) expense $ (48,650 ) $ 118 $ (6,244 ) $ 118 Effective income tax rate 5.7 % (3.6 )% 0.5 % 3.3 % For the three months ended June 30, 2022, discrete tax expense of $0.4 million is included in the $48.7 million of income tax benefit. The Company’s estimated annual effective income tax rate without discrete items was 1.1%, compared to the US federal statutory rate of 21.0% due to the fair value adjustment on debt instruments (2.6)%, change in valuation allowance (5.5)%, goodwill impairment of (11.6)%, non-deductible For the three months ended June 30, 2021, no discrete tax expense was included in the $0.1 million of income tax expense. The Company’s estimated annual effective income tax rate without discrete items was 2.6%, compared to the US federal statutory rate of 21.0% due to the change in valuation allowance of (30.5)%, non deductible interest of 7.0%, and other 5.1%. For the six months ended June 30, 2021, no discrete tax expense was included in the $0.1 million of income tax expense. |
NET (LOSS) INCOME ATTRIBUTABLE
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS | 14. NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS Basic EPS is measured as the income or loss available to common stockholders divided by the weighted average common shares outstanding for the period. Diluted EPS presents the dilutive effect on a per-share basis the if-converted method; Upon the closing of the Merger Agreement with XPDI in January 2022, the Convertible Notes became convertible into common shares at the option of the holder at a conversion price equal to $8.00 per share and also began to meet the definition of a participating security. On or after the closing of the Merger, dividend payments made to equity holders of the Company are also made ratably to holders of the Convertible Notes on an as-converted two-class two-class Convertible Notes under the two-class two-class if-converted Restricted stock awards assumed from Blockcap in July 2021 and the SPAC Vesting Shares issued as part of the XPDI Merger in January 2022 also have non-forfeitable As discussed in Note 1, the shares and corresponding capital amounts and earnings per share available for common stockholders prior to the Merger with XPDI have been retroactively restated as shares reflecting the exchange ratio established in the Merger. As a result of the Merger, the Company has retrospectively adjusted the weighted average number of shares of common stock outstanding prior to January 19, 2022 by multiplying them by the exchange ratio of 1.6001528688 used to determine the number of shares of Class A common stock into which they converted. The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share (in thousands, except per share amounts): Three Months Ended Six Months Ended 2022 2021 2022 2021 Net (loss) income $ (810,475 ) $ (3,414 ) $ (1,276,679 ) $ 3,435 Weighted average shares outstanding - basic 324,967 158,890 316,269 158,338 Add: Dilutive share-based compensation awards — — — 19,004 Weighted average shares outstanding - diluted 324,967 158,890 316,269 177,342 Net (loss) income per share - basic $ (2.49 ) $ (0.02 ) $ (4.04 ) $ 0.02 Net (loss) income per share - diluted $ (2.49 ) $ (0.02 ) $ (4.04 ) $ 0.02 Potentially dilutive securities includes securities not included in the calculation of diluted net loss per share because to do so would be anti-dilutive and contingently issuable shares for which all necessary conditions for issuance had not been satisfied by the end of the period. Potentially dilutive securities are as follows (in common stock equivalent shares, in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Stock options 30,588 4,368 30,588 — Preferred stock — 10,826 — — Warrants 18,311 6,808 18,311 — Restricted stock and restricted stock units 52,064 54,832 52,064 54,832 Convertible Notes 68,126 — 68,126 — SPAC Vesting Shares 1,725 — 1,725 — Total potentially dilutive securities 170,814 76,834 170,814 54,832 |
SEGMENT REPORTING
SEGMENT REPORTING | 6 Months Ended |
Jun. 30, 2022 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | 15. SEGMENT REPORTING The Company has two operating segments: “Equipment Sales and Hosting” which consists primarily of its blockchain infrastructure and third-party hosting business and equipment sales to customers, and “Mining” consisting of digital asset mining for its own account. The blockchain hosting business generates revenue through the sale of consumption-based contracts for its hosting services which are recurring in nature. Equipment sales revenue is derived from its ability to leverage its partnership with leading equipment manufacturers to secure equipment in advance, which is then sold to its customers when they are unable to obtain them otherwise. The digital asset mining operation segment generates revenue from operating owned computer equipment as part of a pool of users that process transactions conducted on one or more blockchain networks. In exchange for these services, the Company receives digital assets. The primary financial measures used by the chief operating decision maker (“CODM”) to evaluate performance and allocate resources are revenue and gross profit. The CODM does not evaluate performance or allocate resources based on segment asset or liability information; accordingly, the Company has not presented a measure of assets by segment. The segments’ accounting policies are the same as those described in the summary of significant accounting policies. The Company excludes certain operating expenses and other expense from the allocations to operating segments. The following table presents revenue and gross (loss) profit by reportable segment for the periods presented (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Equipment Sales and Hosting Segment Revenue: Hosting revenue $ 38,936 $ 18,562 $ 72,150 $ 31,254 Equipment sales 15,194 45,976 41,499 77,902 Total revenue $ 54,130 $ 64,538 $ 113,649 $ 109,156 Cost of revenue: Cost of hosting services $ 43,644 $ 17,550 $ 74,875 $ 29,379 Cost of equipment sales 13,541 31,100 36,076 57,331 Total cost of revenue $ 57,185 $ 48,650 $ 110,951 $ 86,710 Gross (loss) profit $ (3,055 ) $ 15,888 $ 2,698 $ 22,446 Mining Segment Revenue: Digital asset mining income $ 109,842 $ 10,765 $ 242,842 $ 20,393 Total revenue $ 109,842 $ 10,765 $ 242,842 $ 20,393 Cost of revenue: Cost of digital asset mining $ 94,070 $ 2,115 $ 162,820 $ 3,768 Total cost of revenue 94,070 2,115 162,820 3,768 Gross profit $ 15,772 $ 8,650 $ 80,022 $ 16,625 Consolidated Consolidated total revenue $ 163,972 $ 75,303 $ 356,491 $ 129,549 Consolidated cost of revenue $ 151,255 $ 50,765 $ 273,771 $ 90,478 Consolidated gross profit $ 12,717 $ 24,538 $ 82,720 $ 39,071 For the three months ended June 30, 2022 and 2021, cost of revenue included depreciation expense of $2.6 million and $1.9 million, respectively, for the Equipment Sales and Hosting segment. For the three months ended June 30, 2022 and 2021, cost of revenue included depreciation expense of $46.5 million and $0.9 million, respectively for the Mining segment. For the six months ended June 30, 2022 and 2021, cost of revenue included depreciation expense of $4.8 million and $3.7 million, respectively, for the Equipment Sales and Hosting segment. For the six months ended June 30, 2022 and 2021, cost of revenue included depreciation expense of $85.9 million and $1.6 million, respectively for the Mining segment. Concentrations of Revenue and Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of cash and cash equivalents and accounts receivable. Credit risk with respect to accounts receivable is concentrated with a small number of customers. The Company places its cash and cash equivalents with major financial institutions, which management assesses to be of high credit quality, in order to limit the exposure to credit risk. As of June 30, 2022 and December 31, 2021, all of the Company’s fixed assets were located in the United States. For the three and six months ended June 30, 2022 and 2021, all of the Company’s revenue was generated in the United States. For the three and six months ended June 30, 2022, 67% and 68%, respectively, of the Company’s total revenue was generated from digital asset mining of bitcoin, which is subject to extreme price volatility. As of June 30, 2022 and December 31, 2021, substantially all of our digital assets were held by two third-party digital asset services. For the three and six months ended June 30, 2022, no customer accounted for 10% or more of the Company’s total revenue. For the three and six months ended June 30, 2021, the concentration of customers comprising 10% or more of the Company’s total revenue and Equipment Sales and Hosting segment revenue was as follows: Three Months Ended Three Months Ended 2021 2021 Percent of total revenue: Percent of Equipment Customer A 40 % 46 % Blockcap 18 % 21 % Six Months Ended Six Months Ended 2021 2021 Percent of total revenue: Percent of Equipment Sales Customer A 23 % 27 % B 22 % 27 % Blockcap 19 % 23 % A reconciliation of the reportable segment gross profit (loss) to income (loss) before income taxes included in the Company’s Consolidated Statements of Operations and Comprehensive (Loss) Income for the three and six months ended June 30, 2022 and 2021 is as follows (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Reportable segment gross profit $ 12,717 $ 24,538 $ 82,720 $ 39,071 Gain (loss) from sales of digital assets 11,808 (16 ) 13,971 14 Impairment of digital assets (150,213 ) — (204,198 ) — Impairment of goodwill and other intangibles (790,753 ) — (790,753 ) — Losses on exchange or disposal of property, plant and equipment (13,057 ) (17 ) (13,057 ) (17 ) Operating expenses: Research and development 14,773 1,437 18,113 2,645 Sales and marketing 10,238 720 11,636 1,254 General and administrative 90,874 6,822 131,034 10,617 Total operating expenses 115,885 8,979 160,783 14,516 Operating (loss) income (1,045,383 ) 15,526 (1,072,100 ) 24,552 Non-operating Loss on debt extinguishment — 7,974 — 8,016 Interest expense, net 27,116 10,846 48,792 12,981 Fair value adjustment on convertible notes (195,061 ) — 190,976 — Fair value adjustment on derivative warrant liabilities (22,189 ) — (32,464 ) — Other non-operating expenses, 3,876 2 3,519 2 Total non-operating (income) (186,258 ) 18,822 210,823 20,999 (Loss) income before income taxes (859,125 ) (3,296 ) (1,282,923 ) 3,553 Income tax (benefit) expense (48,650 ) 118 (6,244 ) 118 Net (loss) income $ (810,475 ) $ (3,414 ) $ (1,276,679 ) $ 3,435 |
RELATED-PARTY TRANSACTIONS
RELATED-PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2022 | |
Related Party Transactions [Abstract] | |
RELATED-PARTY TRANSACTIONS | 16. RELATED-PARTY TRANSACTIONS In the ordinary course of business, the Company enters into various transactions with related parties. The Company has agreements to provide hosting services to various entities that are managed and invested in by individuals that are directors and executives of the Company. For the three and six months ended June 30, 2022, the Company recognized hosting revenue from the contracts with these entities of $7.6 million and $13.5 million, respectively. For the three and six months ended June 30, 2021, the Company recognized hosting revenue from the contracts with these entities of $6.7 million and $11.0 million, respectively. In addition, for the three and six months ended June 30, 2022, the company recognized equipment sales revenue of $11.7 million and $37.6 million, respectively, from these entities. For the three and six months ended June 30, 2021, the company recognized equipment sales revenue of $9.5 million and $17.4 million, respectively, from these same various entities. As of June 30, 2022 and December 31, 2021, the Company had accounts receivable of $0.7 million and $0.3 million, respectively, from these entities. The Company reimburses certain officers and directors of the Company for use of a personal aircraft for flights taken on Company business. For the three and six months ended June 30, 2022, the Company incurred reimbursements of $0.8 million and $1.2 million, respectively. The Company incurred reimbursements of $0.2 million for both the three and six months ended June 30, 2021. As of June 30, 2022, $0.2 million was payable. A nominal was |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 17. SUBSEQUENT EVENTS Financing Transactions—Committed Equity Financing In July 2022, the Company entered into a common stock purchase agreement (the “Purchase Agreement”) and a Registration Rights Agreement (the “Registration Rights Agreement”) with B. Riley Principal Capital II, LLC (“B. Riley”). Pursuant to the Purchase Agreement, subject to the satisfaction of the conditions set forth in the Purchase Agreement, the Company will have the right to sell to B. Riley, up to $100.0 million of shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”), subject to certain limitations and conditions set forth in the Purchase Agreement, from time to time during the term of the Purchase Agreement. Sales of Common Stock pursuant to the Purchase Agreement, and the timing of any sales, are solely at the Company’s option, and the Company is under no obligation to sell any securities to B. Riley under the Purchase Agreement. The per share purchase price that B. Riley is required to pay for shares of the Company’s Common Stock in a Purchase effected by the Company pursuant to the Purchase Agreement, if any, will be determined by reference to the volume weighted average price (“VWAP”) of the Common Stock, calculated in accordance with the Purchase Agreement, for the period (the “Purchase Valuation Period”) beginning at the official open (or “commencement”) of the regular trading session on Nasdaq on the applicable Purchase Date for such Purchase, and ending at the earliest to occur of (i) 3:59 p.m., New York City time, on such Purchase Date or such earlier time publicly announced by the trading market as the official close of the regular trading session on such Purchase Date, (ii) such time that the total aggregate number (or volume) of shares of Common Stock traded on Nasdaq during such Purchase Valuation Period (calculated in accordance with the Purchase Agreement) reaches the applicable share volume maximum amount for such Purchase (the “Purchase Share Volume Maximum”), calculated by dividing (a) the applicable Purchase Share Amount for such Purchase, by (b) 0.20, and (iii) such time that the trading price of a share of Common Stock on Nasdaq during such Purchase Valuation Period (calculated in accordance with the Purchase Agreement) falls below the applicable minimum price threshold for such Purchase specified by the Company in the Purchase Notice for such Purchase, or if the Company does not specify a minimum price threshold in such Purchase Notice, a price equal to 75.0% of the closing sale price of the Common Stock on the trading day immediately prior to the applicable Purchase Date for such Purchase (the “Minimum Price Threshold”), less a fixed 3.0% discount to the VWAP for such Purchase Valuation Period. The net proceeds to the Company from sales that the Company elects to make to B. Riley under the Purchase Agreement, if any, will depend on the frequency and prices at which the Company sells shares of the Company’s Common Stock to B. Riley. The Company expects that any proceeds received by the Company from such sales to B. Riley will be used for general corporate purposes. There are no restrictions on future financings, rights of first refusal, participation rights, penalties or liquidated damages in the Purchase Agreement or Registration Rights Agreement, other than a prohibition (with certain limited exceptions) on entering into specified “Variable Rate Transactions” (as such term is defined in the Purchase Agreement) during the term of the Purchase Agreement. Such transactions include, among others, the issuance of convertible securities with a conversion or exercise price that is based upon or varies with the trading price of the Company’s Common Stock after the date of issuance, or the Company’s effecting or entering into an agreement to effect an “equity line of credit” or other substantially similar continuous offering with a third party, in which the Company may offer, issue or sell Common Stock or any securities exercisable, exchangeable or convertible into Common Stock at a future determined price. Under the applicable Nasdaq rules, in no event may the Company issue to B. Riley under the Purchase Agreement more than 70.3 million shares of Common Stock, which number of shares is equal to approximately 19.99% of the shares of the Common Stock outstanding immediately prior to the execution of the Purchase Agreement (the “Exchange Cap”), unless (i) the Company obtains stockholder approval to issue shares of Common Stock in excess of the Exchange Cap in accordance with applicable Nasdaq rules, or (ii) the average price per share paid by B. Riley for all of the shares of Common Stock that the Company directs B. Riley to purchase from the Company pursuant to the Purchase Agreement, if any, equals or exceeds $1.75 per share (representing the lower of the official closing price of the Company’s Common Stock on Nasdaq on the trading day immediately preceding the date of the Purchase Agreement and the average official closing price of the Company’s Common Stock on Nasdaq for the five 13d-3 The Purchase Agreement will automatically terminate on the earliest to occur of (i) the first day of the month next following the 24-month The Company has the right to terminate the Purchase Agreement at any time after Commencement, at no cost or penalty, upon five (5) trading days’ prior written notice to B. Riley. B. Riley has the right to terminate the Purchase Agreement upon five (5) trading days’ prior written notice to the Company upon the occurrence of certain events set forth in the Purchase Agreement. The Company and B. Riley may also agree to terminate the Purchase Agreement by mutual written consent, provided that no termination of the Purchase Agreement will be effective until the fifth trading day immediately following the settlement date related to any pending purchase that has not been fully settled in accordance with the Purchase Agreement. Neither the Company nor B. Riley may assign or transfer their respective rights and obligations under the Purchase Agreement or the Registration Rights Agreement. As consideration for B. Riley’s commitment to purchase shares of Common Stock at the Company’s direction upon the terms and subject to the conditions set forth in the Purchase Agreement, upon execution of the Purchase Agreement, the Company issued 0.6 million shares to B. Riley. In addition, the Company reimbursed $0.1 million of reasonable legal fees and disbursements of B. Riley’s legal counsel in connection with the transactions contemplated by the Purchase Agreement and the Registration Rights Agreement. Financing Transactions—Amended Bridge Notes In August 2022, we entered into two amended and restated bridge promissory notes, one in an aggregate principal amount of $60.0 million with B. Riley Commercial Capital, LLC (“B. Riley Commercial Capital”) and one in an aggregate principal amount of $15.0 million with an affiliate of B. Riley Commercial Capital (the “Amended Bridge Notes”). The Amended Bridge Notes amend the original notes having identical principal amounts to extend the maturity date from December 7, 2022 to June 1, 2023. The Amended Bridge Notes bear interest at a rate of 7% per annum. Under the terms of the modified agreement, $37.5 million of principal payments previously due in the second half of 2022 are now due in the first half of 2023. The Amended Bridge Notes require the proceeds of (i) any equity issuances (other than issuances consummated for purposes of making tax payments in connection with the vesting of restricted stock and restricted stock units and equity line of credit under the Purchase Agreement (“ELOC”) sales), (ii) any secured debt incurred on or after April 7, 2022 (other than purchase money debt) in excess of $500 million and (iii) any ELOC sales in an amount equal to 25% of the net cash proceeds received from any such ELOC sale, in each case, to be applied by us to repay the outstanding principal amount of the Amended Bridge Notes. The Amended Bridge Notes are unsecured and not guaranteed by any of our subsidiaries. We are subject to a quarterly financial reporting covenant and negative covenants restricting our ability to (i) merge or consolidate with any other person (subject to customary exceptions), (ii) make cash dividends or distributions with any material portion of the proceeds of the Amended Bridge Notes or any other debt, (iii) dispose of all or substantially all of the assets of Core Scientific, (iv) prepay contractually subordinated debt, (v) transact with affiliates (subject to customary exceptions) and (vi) modify or enter into any material contracts in a manner that would restrict us from making payments to the noteholders under the Amended Bridge Notes or require the net cash proceeds from an equity raise to be paid to any entity other than the noteholders under the Amended Bridge Notes. Upon the occurrence of certain events of default, our obligations under the Amended Bridge Notes may be accelerated. Such events of default include payment defaults under the Bridge Notes, covenant defaults and other customary defaults. On August 1, 2022, the Company issued a total of 0.4 million shares of Common Stock to B. Riley Securities, Inc., an affiliate of B. Riley Commercial Capital, in satisfaction of an advisory fee for providing advisory services to the Company in connection with entering into the Amended Bridge Notes. Customer Bankruptcy In July 2022, Celsius Networks, the parent company of Celsius Mining LLC (“Celsius”), filed for voluntary relief under Chapter 11 of the Bankruptcy Code. Celsius is one of our two largest customers. As of June 30, 2022, we had $0.9 million due from Celsius that is presented within accounts receivable, net, of which $0.8 million was outstanding in July 2022 at the time of bankruptcy petition. Celsius may take actions in its Chapter 11 proceeding to terminate or renegotiate its agreements with us and/or seek to reduce our claims for services and damages to which we may be entitled. Our recovery on our claims will be subject to factors outside of our control. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation We have prepared the accompanying consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. These consolidated financial statements are unaudited and, in our opinion, include all adjustments, consisting of normal recurring adjustments and accruals necessary for a fair presentation of our consolidated cash flows, operating results, and balance sheets for the periods presented. Operating results for the periods presented are not necessarily indicative of the results that may be expected for 2022. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted in accordance with the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes included as an exhibit to the amendment to the Current Report on Form 8-K/A, “8-K/A”). |
Use of Estimates | Use of Estimates The consolidated assets, liabilities and results of operations prior to the reverse recapitalization are those of Core Scientific Holding Co. The outstanding shares and corresponding capital amounts, and losses per share, prior to the reverse recapitalization, have been retroactively adjusted in accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income and expenses during the reporting period. Some of the more significant estimates include the valuation of the Company’s common shares and the determination of the grant date fair value of stock-based compensation awards for periods prior to the Merger, the valuation of goodwill and intangibles, the fair value of convertible debt, acquisition purchase price accounting, and income taxes. These estimates are based on information available as of |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents include all cash balances and highly liquid investments with original maturities of three months or less from the date of acquisition. As of June 30, 2022 and December 31, 2021, cash equivalents included $105.1 million and $100.0 million of highly liquid money market funds, respectively, which are classified as Level 1 within the fair value hierarchy. Restricted cash consists of cash held in escrow to pay for construction and development activities. The following table provides a reconciliation of the amount of cash, cash equivalents and restricted cash reported on the Consolidated Balance Sheets to the total of the same amount shown in the Consolidated Statements of Cash Flows (in thousands): June 30, 2022 December 31, 2021 Cash and cash equivalents $ 128,542 $ 117,871 Restricted cash 11,938 13,807 Total cash, cash equivalents and restricted cash $ 140,480 $ 131,678 |
Property, Plant and Equipment, Net | Property, Plant and Equipment, Net Property, plant and equipment includes land, buildings and improvements for datacenter facilities and leasehold improvements for the Company’s corporate headquarters. Property and equipment consists of computer, mining, network, electrical and other equipment, including right-of-use Subsequent to January 1, 2022, future obligations related to finance leases are presented as Finance lease liabilities, current portion and Finance lease liabilities, net of current portion in the Company’s Consolidated Balance Sheets. Finance lease right-of-use right-of-use Prior to January 1, 2022, future obligations related to capital leases accounted for under ASC 840, Leases, Self-mining computer equipment that is subsequently contracted for sale to customers is valued at the lower |
Derivative Warrant Liabilities | Derivative Warrant Liabilities The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. The classification of derivative instruments, including whether such instruments should be classified as liabilities or as equity, is re-assessed The Public Warrants and the Private Placement Warrants are recognized as derivative liabilities. Accordingly, the Company recognizes the warrant instruments as liabilities at fair value and adjusts the instruments to fair value at each reporting period. The liabilities are subject to re-measurement |
Recently Adopted Accounting Standard and Accounting Pronouncements not yet adopted | Recently Adopted Accounting Standards Simplifying Income Taxes In December 2019 , (“ASU”) 2019-12 , Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, when year-to date not Leases In February 2016, the FASB issued ASU No. 2016-02, Leases-(Topic 842) right-of-use non-current right-of-use A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. The Company adopted the new standard on January 1, 2022 and used the effective date as the date of initial application. Consequently, financial information has not been updated, and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2022. The new standard provides a number of optional practical expedients in transition. The Company has elected the ‘package of use-of-hindsight The new standard also provides practical expedients for the Company’s ongoing accounting. The Company has elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, the Company does not recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. The Company has not elected to apply the practical expedient to not separate lease and non-lease The cumulative effect of initially applying the new lease standard on January 1, 2022 is as follows (in thousands): January 1, 2022 Beginning Balance Cumulative Effect Beginning Balance, Assets Prepaid expenses and other current assets $ 30,111 $ (453 ) $ 29,658 Other noncurrent assets $ 21,045 $ 1,814 $ 22,859 Liabilities Accrued expenses and other $ 67,862 $ (188 ) $ 67,674 Other noncurrent liabilities $ 18,531 $ (1,173 ) $ 17,358 The most significant judgments and impacts upon adoption of the standard include the following: • We recognized right-of-use right-of-use right-of-use • In determining the discount rate used to measure the right-of-use • Certain line items in the Consolidated Balance Sheets have been renamed to align with the new terminology presented in the new lease standard; “Capital lease obligations, current portion” and “Capital lease obligations, net of current portion” are now presented as “Finance lease liabilities, current portion” and “Finance lease liabilities, net of current portion” on the Consolidated Balance Sheets, respectively. • Upon adoption on January 1, 2022, Operating lease right-of-use Other noncurrent assets Sheets addition, upon adoption on January 1, 2022, the current portion of operating lease liabilities of $0.2 million were recorded in Accrued expenses and other and the noncurrent portion of operating lease liabilities of $1.2 million were recorded within Other noncurrent liabilities on the Consolidated Balance Sheets. Accounting Standards not yet adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Measurement of Credit Losses on Financial Instruments 10-K There are no other new accounting pronouncements that are expected to have a significant impact on the Company’s consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Cash Cash Equivalents and Restricted Cash | The following table provides a reconciliation of the amount of cash, cash equivalents and restricted cash reported on the Consolidated Balance Sheets to the total of the same amount shown in the Consolidated Statements of Cash Flows (in thousands): June 30, 2022 December 31, 2021 Cash and cash equivalents $ 128,542 $ 117,871 Restricted cash 11,938 13,807 Total cash, cash equivalents and restricted cash $ 140,480 $ 131,678 |
Schedule of Accounting Standards Update | The cumulative effect of initially applying the new lease standard on January 1, 2022 is as follows (in thousands): January 1, 2022 Beginning Balance Cumulative Effect Beginning Balance, Assets Prepaid expenses and other current assets $ 30,111 $ (453 ) $ 29,658 Other noncurrent assets $ 21,045 $ 1,814 $ 22,859 Liabilities Accrued expenses and other $ 67,862 $ (188 ) $ 67,674 Other noncurrent liabilities $ 18,531 $ (1,173 ) $ 17,358 |
ACQUISITIONS, DISPOSITIONS AN_2
ACQUISITIONS, DISPOSITIONS AND RESTRUCTURING (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the fair values for each major class of assets acquired and liabilities assumed at the acquisition date. The Company retained the services of certified valuation specialists to assist with assigning estimated values to certain acquired assets and assumed liabilities. Amounts initially disclosed for the estimated values of certain acquired assets and liabilities assumed were adjusted through June 30, 2022 based on information arising after the initial preliminary valuation. PPA Allocation Consideration (in thousands) 113.9 million common shares valued at $10.11 per share 1,2 $ 1,151,985 Fair value of replaced Blockcap share-based payments attributable to pre-combination 3 21,768 Settlement of Blockcap debt 4 25,607 Settlement of preexisting contracts 5 (60,522 ) Total Consideration $ 1,138,838 Fair value of assets acquired, and liabilities assumed: Cash and cash equivalents $ 704 Digital assets-Bitcoin 73,304 Digital assets-Ethereum 365 Digital assets-Bitcoin cash 8 Digital assets-Siacoin 554 Digital assets-Other 3,329 Other current assets 633 Intangible assets, net 2,925 Property, plant and equipment, net 98,965 Other noncurrent assets 1,293 Total assets acquired $ 182,080 Accounts payable 492 Accrued expenses and other 22,647 Deferred revenue 414 Other current liabilities 7,204 Deferred tax liability 9,003 Total liabilities assumed $ 39,760 Total identifiable net assets $ 142,320 Goodwill on acquisition $ 996,518 1 113.9 million common shares represent the equivalent Core Scientific common shares issued to Blockcap shareholders as consideration for the purchase. 2 The price per share of our common shares was estimated to be $10.11. As the Core Scientific common shares were not listed on a public marketplace, the calculation of the fair value of the common shares was subject to a greater degree of estimation. Given the absence of a public market, an estimate of the fair value of the common shares was required at the time of the Blockcap acquisition. Objective and subjective factors were considered in determining the estimated fair value and because there was no active trading of the Core Scientific equity shares on an established securities market, an independent valuation specialist was engaged. The valuation was determined by weighting the outcomes of scenarios estimating share value based on both public company valuations and private company valuations. Both a market approach and common stock equivalency model were used to determine a range of outcomes, which were weighted based on probability to determine the result. 3 Reflects the estimated fair value of replaced Blockcap share-based payments allocated to purchase price based on the proportion of service related to the pre-combination 4 Reflects the fair value of loans issued by the Company in July 2021 that were effectively used to settle debt that had previously been held by Blockcap. Refer to Note 6 for further discussion of the debt issuance. 5 Blockcap had preexisting hosting and equipment contracts with the Company that were effectively settled by the Company’s acquisition of Blockcap. As a result, the consideration transferred to Blockcap has been adjusted by the deferred revenue balances that were settled at the time of acquisition. |
GOODWILL (Tables)
GOODWILL (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following table provides the reconciliation of the carrying amount of goodwill by segment at the beginning and end of the reporting period (in thousands): Equipment Sales Mining Segment Total Goodwill Balance as of December 31, 2021 $ 58,241 $ 997,519 $ 1,055,760 Subsequent measurement period adjustment — (1,000 ) (1,000 ) Impairment of goodwill — (788,722 ) (788,722 ) Balance as of June 30, 2022 $ 58,241 $ 207,797 $ 266,038 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | Notes payable as of June 30, 2022 and December 31, 2021 consist of the following (in thousands): June 30 December 31 Kentucky note $ 784 $ 1,032 Genesis loan — 552 NYDIG loan 48,642 67,435 Stockholder loan 10,000 10,000 Trinity loan 26,148 19,641 Bremer loan 20,116 15,066 Blockfi loan 60,652 60,000 Anchor Labs loan 30,016 — Mass Mutual Barings loans 65,550 — B. Riley Bridge Notes 75,000 — Liberty loan 8,676 — Secured Convertible Notes 1 227,528 220,871 Other Convertible Notes 2 308,753 301,226 Other 2,073 663 Total 883,938 696,486 Unamortized discount and debt issuance costs (4,214 ) (3,187 ) Fair value adjustment on convertible notes 190,273 34,910 Total notes payable, net $ 1,069,997 $ 728,209 1 Secured Convertible Notes (includes principal balance at issuance and PIK interest) which considers the minimum payoff at maturity of two times the face value of the note plus accrued interest. The minimum payoff at maturity related to the principal balance was $455.1 million on June 30, 2022. The minimum payoff at maturity related to the principal balance was $441.7 million on December 31, 2021. 2 Other Convertible Notes which considers the minimum payoff at maturity of one times the face value of the note plus accrued interest. |
Schedule of Fair Value Adjustments and Debt Issuance Costs | The following summarizes the fair value adjustments and debt issuance costs recognized on the convertible notes (in thousands): Financial statement line item Three Months Six Months Cash interest payments Interest expense, net $ 5,355 $ 10,582 Payment-in-kind Interest expense, net 8,032 15,883 Instrument-specific credit risk Other comprehensive income, net of income taxes (8,582 ) (35,746) Other fair value adjustments Fair value adjustment (195,061 ) 190,976 Total fair value adjustments $ (190,256 ) $ 181,695 Financial statement line item Three and Six Cash interest payments Interest expense, net $ 1,720 Payment-in-kind Interest expense, net 2,580 Instrument-specific credit risk Other comprehensive income, net of income taxes — Other fair value adjustments Fair value adjustment on convertible notes — Total fair value adjustments $ 4,300 Debt issuance costs Interest expense, net $ 5,581 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Convertible Notes | The following presents the levels of the fair value hierarchy for the Company’s derivative warrant liabilities and the Convertible Notes by issuance date measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021 (in thousands): June 30, 2022 Fair value hierarchy Principal Level 1 Level 2 Level 3 Fair value Derivative warrant liabilities: Public Warrants $ — $ 3,364 $ — $ — $ 3,364 Private Placement Warrants — — 2,444 — 2,444 Total derivative warrant liabilities — 3,364 2,444 — 5,808 Convertible notes: April 19, 2021 1 $ 94,186 $ — $ — $ 172,610 $ 172,610 April 21, 2021 1 5,291 — — 9,697 9,697 April 23, 2021 1 47,622 — — 87,275 87,275 April 26, 2021 1 80,429 — — 147,398 147,398 August 20, 2021 2 52,122 — — 49,635 49,635 September 10, 2021 2 15,559 — — 15,272 15,272 September 23, 2021 2 77,825 — — 76,393 76,393 September 24, 2021 2 61,825 — — 60,687 60,687 September 27, 2021 2 2,034 — — 1,996 1,996 October 1, 2021 2 89,269 — — 87,627 87,627 November 10, 2021 2 10,119 — — 9,933 9,933 Accrued PIK interest 1,2,3 — — — 8,031 8,031 Total convertible notes 536,281 — — 726,554 726,554 Total liabilities measured at fair value on a recurring basis $ 536,281 $ 3,364 $ 2,444 $ 726,554 $ 732,362 December 31, 2021 Fair value hierarchy Principal Level 1 Level 2 Level 3 Fair value Convertible notes: April 19, 2021 1 $ 91,430 $ — $ — $ 101,078 $ 101,078 April 21, 2021 1 5,137 — — 5,674 5,674 April 23, 2021 1 46,229 — — 51,062 51,062 April 26, 2021 1 78,075 — — 86,165 86,165 August 20, 2021 2 50,597 — — 50,941 50,941 September 10, 2021 2 16,110 — — 16,472 16,472 September 23, 2021 2 76,051 — — 77,559 77,559 September 24, 2021 2 60,016 — — 61,179 61,179 September 27, 2021 2 1,974 — — 2,012 2,012 October 1, 2021 2 86,655 — — 87,150 87,150 November 10, 2021 2 9,823 — — 9,819 9,819 Accrued PIK interest 1,2,4 — — — 7,896 7,896 Total convertible notes $ 522,097 $ — $ — $ 557,007 $ 557,007 1 Secured Convertible Notes (includes principal balance at issuance and PIK interest) which considers the minimum payoff at maturity of two times the face value of the note plus accrued interest. 2 Other Convertible Notes (other than the Secured Convertible notes) which considers the minimum payoff at maturity of one times the face value of the note plus accrued interest. 3 Represents PIK interest accrued as of June 30, 2022 which will be recorded as additional principal for each respective convertible note on July 1, 2022. 4 Represents PIK interest accrued as of December 31, 2021 which will be recorded as additional principal for each respective convertible note on January 1, 2022. Level 3 Recurring Fair Value Measurements The following presents a rollforward of the activity for the Convertible Notes measured at fair value on a recurring basis using level 3 inputs as of June 30, 2022 (in thousands): Convertible (Level 3) Balance at December 31, 2021 $ 557,007 Issuances (including PIK principal recorded) 7,896 Settlements (including interest payments, PIK principal recorded and conversions) (13,123 ) Unrealized losses 371,951 Balance at March 31, 2022 923,731 Issuances (including PIK principal recorded) 7,851 Settlements (including interest payments, PIK principal recorded and conversions) (14,772 ) Unrealized gains (190,256 ) Balance at June 30, 2022 $ 726,554 |
Schedule of Convertible Debt Fair Value Measurement Input | The following presents significant Level 3 unobservable inputs used to measure the fair value of certain convertible notes as of June 30, 2022 (dollars in thousands): Fair value Unobservable Input Low High Weighted 1 Convertible Notes $ 726,554 Expected term (years) 2.80 2.80 2.80 Volatility 46.3 % 46.3 % 46.3 % 1 Weighted average based on the fair value of convertible notes. |
Schedule of Digital Currency Assets | Digital assets are available for use, if needed, for current operations and are classified as current assets on the Consolidated Balance Sheets, the details of which are presented below (in thousands). June 30 December 31 Bitcoin (BTC) $ 37,646 $ 224,843 Ethereum (ETH) 1,200 4,665 Polygon (MATIC) 182 1,085 Siacoin (SC) — 803 Dai (DAI) — 1,353 Other 1,636 1,549 Total digital assets $ 40,664 $ 234,298 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
Schedule of Assets and Liabilities | The components of operating and finance leases are presented on the Company’s Consolidated Balance Sheets as follows (in thousands): Financial statement line item June 30, 2022 Assets: Operating lease right-of-use Other noncurrent asset $ 6,401 Finance lease right-of-use Property, plant and equipment, ne $ 97,655 Liabilities: Operating lease liabilities, current portion Accrued expenses and othe $ 75 Operating lease liabilities, net of current portion Other noncurrent liabilitie $ 1,127 Finance lease liabilities, current portion Finance lease liabilities, current portion $ 28,570 Finance lease liabilities, net of current portion Finance lease liabilities, net of current portion $ 48,701 |
Schedule of Lease Cost | The components of lease expense were as follows (in thousands): Financial statement line item Three Months Ended Six Months Ended Operating lease expense General and administrative expenses $ 154 $ 309 Short-term lease expense General and administrative expenses 287 477 Finance lease expense: Amortization of right-of-use Cost of revenue 8,699 18,523 Interest on lease liabilities Interest expense, net 2,248 4,339 Total finance lease expense 10,947 22,862 Total lease expense $ 11,388 $ 23,648 June 30, 2022 Weighted Average Remaining Lease Term (Years) Operating leases 21.5 Finance leases 2.5 Weighted Average Discount Rate Operating leases 6.4 % Finance leases 11.0 % |
Schedule of Supplemental Cash Flow Information | The following table summarizes the Company’s supplemental cash flow information (in thousands): Three Months Ended Six Months Ended Lease Payments Operating lease payments $ 101 $ 202 Finance lease payments $ 15,169 $ 27,526 Supplemental Noncash Information Operating lease right-of-use $ — $ — Finance lease right-of-use $ — $ 10,557 |
Schedule of Operating Lease Liability, Maturity | The Company’s minimum payments under noncancelable operating and finance leases having initial terms and bargain renewal periods in excess of one year are as follows at June 30, 2022, and thereafter (in thousands): Operating leases Finance leases Remaining 2022 $ 69 $ 18,131 2023 170 34,948 2024 170 31,332 2025 170 4,509 2026 170 3 2027 170 — Thereafter 1,251 — Total lease payments 2,170 88,923 Less: imputed interest 968 11,652 Total $ 1,202 $ 77,271 |
Schedule of Finance Lease Liability, Maturity | The Company’s minimum payments under noncancelable operating and finance leases having initial terms and bargain renewal periods in excess of one year are as follows at June 30, 2022, and thereafter (in thousands) Operating leases Finance leases Remaining 2022 $ 69 $ 18,131 2023 170 34,948 2024 170 31,332 2025 170 4,509 2026 170 3 2027 170 — Thereafter 1,251 — Total lease payments 2,170 88,923 Less: imputed interest 968 11,652 Total $ 1,202 $ 77,271 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Equity [Abstract] | |
Schedule of Share-based Compensation Arrangements by Share-based Payment Award | Stock-based compensation expense for the three and six months ended June 30, 2022 and 2021 is included in the Company’s Consolidated Statements of Operations and Comprehensive (Loss) Income as follows (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Cost of revenue $ 16,882 $ — $ 18,921 $ — Research and development 13,177 — 15,059 — Sales and marketing 9,132 — 9,590 — General and administrative 71,807 2,136 93,225 2,724 Total stock-based compensation expense $ 110,998 $ 2,136 $ 136,795 $ 2,724 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax (Benefit) Expense and Effective Income Tax Rate | The income tax (benefit) expense and effective income tax rate for the three and six months ended June 30, 2022 and 2021 were as follows: Three Months Ended Six Months Ended 2022 2021 2022 2021 (in thousands, except percentages) Income tax (benefit) expense $ (48,650 ) $ 118 $ (6,244 ) $ 118 Effective income tax rate 5.7 % (3.6 )% 0.5 % 3.3 % |
NET (LOSS) INCOME ATTRIBUTABL_2
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share (in thousands, except per share amounts): Three Months Ended Six Months Ended 2022 2021 2022 2021 Net (loss) income $ (810,475 ) $ (3,414 ) $ (1,276,679 ) $ 3,435 Weighted average shares outstanding - basic 324,967 158,890 316,269 158,338 Add: Dilutive share-based compensation awards — — — 19,004 Weighted average shares outstanding - diluted 324,967 158,890 316,269 177,342 Net (loss) income per share - basic $ (2.49 ) $ (0.02 ) $ (4.04 ) $ 0.02 Net (loss) income per share - diluted $ (2.49 ) $ (0.02 ) $ (4.04 ) $ 0.02 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings (Loss) Per Share | Potentially dilutive securities includes securities not included in the calculation of diluted net loss per share because to do so would be anti-dilutive and contingently issuable shares for which all necessary conditions for issuance had not been satisfied by the end of the period. Potentially dilutive securities are as follows (in common stock equivalent shares, in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Stock options 30,588 4,368 30,588 — Preferred stock — 10,826 — — Warrants 18,311 6,808 18,311 — Restricted stock and restricted stock units 52,064 54,832 52,064 54,832 Convertible Notes 68,126 — 68,126 — SPAC Vesting Shares 1,725 — 1,725 — Total potentially dilutive securities 170,814 76,834 170,814 54,832 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Revenue and Gross Profit by Reporting Segment | The following table presents revenue and gross (loss) profit by reportable segment for the periods presented (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Equipment Sales and Hosting Segment Revenue: Hosting revenue $ 38,936 $ 18,562 $ 72,150 $ 31,254 Equipment sales 15,194 45,976 41,499 77,902 Total revenue $ 54,130 $ 64,538 $ 113,649 $ 109,156 Cost of revenue: Cost of hosting services $ 43,644 $ 17,550 $ 74,875 $ 29,379 Cost of equipment sales 13,541 31,100 36,076 57,331 Total cost of revenue $ 57,185 $ 48,650 $ 110,951 $ 86,710 Gross (loss) profit $ (3,055 ) $ 15,888 $ 2,698 $ 22,446 Mining Segment Revenue: Digital asset mining income $ 109,842 $ 10,765 $ 242,842 $ 20,393 Total revenue $ 109,842 $ 10,765 $ 242,842 $ 20,393 Cost of revenue: Cost of digital asset mining $ 94,070 $ 2,115 $ 162,820 $ 3,768 Total cost of revenue 94,070 2,115 162,820 3,768 Gross profit $ 15,772 $ 8,650 $ 80,022 $ 16,625 Consolidated Consolidated total revenue $ 163,972 $ 75,303 $ 356,491 $ 129,549 Consolidated cost of revenue $ 151,255 $ 50,765 $ 273,771 $ 90,478 Consolidated gross profit $ 12,717 $ 24,538 $ 82,720 $ 39,071 |
Schedules of Customer Concentration Risk | For the three and six months ended June 30, 2022, no customer accounted for 10% or more of the Company’s total revenue. For the three and six months ended June 30, 2021, the concentration of customers comprising 10% or more of the Company’s total revenue and Equipment Sales and Hosting segment revenue was as follows: Three Months Ended Three Months Ended 2021 2021 Percent of total revenue: Percent of Equipment Customer A 40 % 46 % Blockcap 18 % 21 % Six Months Ended Six Months Ended 2021 2021 Percent of total revenue: Percent of Equipment Sales Customer A 23 % 27 % B 22 % 27 % Blockcap 19 % 23 % |
Reconciliation of Reportable Segment Gross Profit to Loss Before Income Taxes | A reconciliation of the reportable segment gross profit (loss) to income (loss) before income taxes included in the Company’s Consolidated Statements of Operations and Comprehensive (Loss) Income for the three and six months ended June 30, 2022 and 2021 is as follows (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Reportable segment gross profit $ 12,717 $ 24,538 $ 82,720 $ 39,071 Gain (loss) from sales of digital assets 11,808 (16 ) 13,971 14 Impairment of digital assets (150,213 ) — (204,198 ) — Impairment of goodwill and other intangibles (790,753 ) — (790,753 ) — Losses on exchange or disposal of property, plant and equipment (13,057 ) (17 ) (13,057 ) (17 ) Operating expenses: Research and development 14,773 1,437 18,113 2,645 Sales and marketing 10,238 720 11,636 1,254 General and administrative 90,874 6,822 131,034 10,617 Total operating expenses 115,885 8,979 160,783 14,516 Operating (loss) income (1,045,383 ) 15,526 (1,072,100 ) 24,552 Non-operating Loss on debt extinguishment — 7,974 — 8,016 Interest expense, net 27,116 10,846 48,792 12,981 Fair value adjustment on convertible notes (195,061 ) — 190,976 — Fair value adjustment on derivative warrant liabilities (22,189 ) — (32,464 ) — Other non-operating expenses, 3,876 2 3,519 2 Total non-operating (income) (186,258 ) 18,822 210,823 20,999 (Loss) income before income taxes (859,125 ) (3,296 ) (1,282,923 ) 3,553 Income tax (benefit) expense (48,650 ) 118 (6,244 ) 118 Net (loss) income $ (810,475 ) $ (3,414 ) $ (1,276,679 ) $ 3,435 |
ORGANIZATION AND DESCRIPTION _2
ORGANIZATION AND DESCRIPTION OF BUSINESS (Details) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jan. 18, 2022 USD ($) $ / shares shares | Jun. 30, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Jan. 19, 2022 USD ($) $ / shares shares | |
Class of Stock [Line Items] | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.00001 | |
Common stock, exchange ratio | 1.6001528688 | |||
Common stock, shares outstanding (in shares) | shares | 353,481,000 | 271,576,000 | ||
Proceeds from transactions | $ | $ 221,600 | |||
Proceeds from transactions, net of transaction expenses | $ | $ 195,000 | |||
Reverse recapitalization, transaction costs | $ | $ 7,900 | $ 18,600 | ||
Capitalized transaction costs, noncurrent | $ | 10,700 | |||
Costs attributable to issuance of common stock and equity instruments - Merger with XPDI | $ | (16,642) | $ 16,600 | ||
Transaction costs allocated to liability-classified instruments | $ | $ 2,000 | |||
Contingently redeemable preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
SPAC vesting shares (in shares) | shares | 1,700,000 | |||
Volume weighted average price (in dollars per share) | $ / shares | $ 12.5 | |||
Vesting terms, threshold number of trading days | 20 days | |||
Vesting terms, threshold number of consecutive trading days | 30 days | |||
Threshold period after the Closing Date | 5 years | |||
Warrants outstanding (in shares) | shares | 14,900,000 | |||
Public Warrants | ||||
Class of Stock [Line Items] | ||||
Warrants outstanding (in shares) | shares | 8,600,000 | |||
Private Placement Warrants | ||||
Class of Stock [Line Items] | ||||
Warrants outstanding (in shares) | shares | 6,300,000 | |||
Conversion of Series A Preferred Stock to Common Stock | ||||
Class of Stock [Line Items] | ||||
Recapitalization transaction, conversion ratio | 1 | |||
Conversion of XPDI Class B Common Stock to New Core Common Stock | ||||
Class of Stock [Line Items] | ||||
Recapitalization transaction, conversion ratio | 1 | |||
Conversion of Series B Preferred Stock to Common Stock | ||||
Class of Stock [Line Items] | ||||
Recapitalization transaction, conversion ratio | 1 | |||
Conversion of XPDI's Common Stock to New Core Common Stock | ||||
Class of Stock [Line Items] | ||||
Recapitalization transaction, conversion ratio | 1 | |||
Former Core Scientific Stockholders | ||||
Class of Stock [Line Items] | ||||
Percent of ownership after transaction | 90.7 | |||
Former XPDI Public Stockholders | ||||
Class of Stock [Line Items] | ||||
Percent of ownership after transaction | 6.7 | |||
XPDI Sponsor | ||||
Class of Stock [Line Items] | ||||
Percent of ownership after transaction | 2.6 | |||
XPDI | ||||
Class of Stock [Line Items] | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | |||
Stock redeemed (in shares) | shares | 12,300,000 | |||
Share redemption price (in dollars per share) | $ / shares | $ 10 | |||
Stock redeemed | $ | $ 123,500 | |||
XPDI | Public Warrants | ||||
Class of Stock [Line Items] | ||||
Warrants outstanding (in shares) | shares | 8,600,000 | |||
XPDI | Private Placement Warrants | ||||
Class of Stock [Line Items] | ||||
Warrants outstanding (in shares) | shares | 6,300,000 | |||
Class A common stock | XPDI | ||||
Class of Stock [Line Items] | ||||
Common stock, shares outstanding (in shares) | shares | 34,500,000 | |||
Class B common stock | XPDI | ||||
Class of Stock [Line Items] | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | |||
New Core Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | |||
Series A Preferred Stock | ||||
Class of Stock [Line Items] | ||||
Contingently redeemable preferred stock, par value (in dollars per share) | $ / shares | $ 0.00001 | |||
Series B Preferred Stock | ||||
Class of Stock [Line Items] | ||||
Contingently redeemable preferred stock, par value (in dollars per share) | $ / shares | $ 0.00001 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Jan. 01, 2022 | Dec. 31, 2021 |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Property, plant and equipment, net | $ 1,049,070 | $ 597,304 | |
Operating lease right-of-use assets | $ 6,401 | $ 6,700 | |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other noncurrent assets | Other noncurrent assets | |
Operating lease right-of-use assets, amount related to prepaid rent | $ 500 | ||
Operating lease right-of-use assets, amount previously presented as other noncurrent assets | 4,800 | ||
Operating lease liabilities, current portion | $ 75 | 200 | |
Operating lease liabilities, net of current portion | 1,127 | $ 1,200 | |
Construction in Progress [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Property, plant and equipment, net | 171,700 | 42,600 | |
Money Market Funds | Level 1 | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Cash equivalents | $ 105,100 | $ 100,000 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 128,542 | $ 117,871 | ||
Restricted cash | 11,938 | 13,807 | ||
Total cash, cash equivalents and restricted cash | $ 140,480 | $ 131,678 | $ 58,371 | $ 8,721 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Accounting Standards Update (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Jan. 01, 2022 | Dec. 31, 2021 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Prepaid expenses and other current assets | $ 161,234 | $ 30,111 | |
Other noncurrent assets | 14,903 | 21,045 | |
Accrued expenses and other | 124,488 | 67,862 | |
Other noncurrent liabilities | $ 11,130 | 18,531 | |
Cumulative Effect Adjustment | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Prepaid expenses and other current assets | (453) | ||
Other noncurrent assets | 1,814 | ||
Accrued expenses and other | (188) | ||
Other noncurrent liabilities | $ (1,173) | ||
Beginning Balance, As Adjusted | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Prepaid expenses and other current assets | $ 29,658 | ||
Other noncurrent assets | 22,859 | ||
Accrued expenses and other | 67,674 | ||
Other noncurrent liabilities | $ 17,358 |
ACQUISITIONS, DISPOSITIONS AN_3
ACQUISITIONS, DISPOSITIONS AND RESTRUCTURING - Asset Acquisition (Details) $ / shares in Units, $ in Thousands, shares in Millions | 1 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 USD ($) | Jun. 30, 2020 USD ($) Patent $ / shares shares | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Mar. 31, 2022 USD ($) | |
Asset Acquisition [Line Items] | |||||
Proceeds from sale of intangibles | $ 10,850 | $ 0 | |||
Gain on sale of intangible assets | $ (5,904) | $ 0 | |||
Software and Software Development Costs | |||||
Asset Acquisition [Line Items] | |||||
Proceeds from sale of intangibles | $ 10,900 | ||||
Gain on sale of intangible assets | $ 5,900 | ||||
Software and Software Development Costs | Disposal Group, Held-for-sale, Not Discontinued Operations | Atrio and RStor | |||||
Asset Acquisition [Line Items] | |||||
Intangible assets reclassified | $ 2,200 | ||||
Atrio Asset Acquisition | |||||
Asset Acquisition [Line Items] | |||||
Payments to acquire assets | $ 1,200 | ||||
Asset acquisition consideration, common stock (in shares) | shares | 0.5 | ||||
Asset acquisition, consideration transferred | $ 2,400 | ||||
Asset acquisition consideration, stock price (in dollars per share) | $ / shares | $ 2.19 | ||||
RStor Asset Acquisition | |||||
Asset Acquisition [Line Items] | |||||
Asset acquisition consideration, common stock (in shares) | shares | 0.4 | ||||
Asset acquisition, consideration transferred | $ 900 | ||||
Asset acquisition consideration, stock price (in dollars per share) | $ / shares | $ 2.19 | ||||
Number of patents acquired | Patent | 3 |
ACQUISITIONS, DISPOSITIONS AN_4
ACQUISITIONS, DISPOSITIONS AND RESTRUCTURING - Business Combination (Details) - USD ($) $ in Thousands, shares in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | ||||
Goodwill, purchase accounting adjustments | $ 1,000 | |||
Goodwill | $ 266,038 | $ 266,038 | $ 1,055,760 | |
Blockcap | ||||
Business Acquisition [Line Items] | ||||
Equity interest acquired | 100% | |||
Business combination, measurement period adjustment, property plant and equipment increase (decrease) | 700 | |||
Goodwill, purchase accounting adjustments | 1,000 | |||
Business combination, provisional information, initial accounting incomplete, adjustment, additional depreciation expense | $ 300 | |||
Goodwill | $ 996,518 | |||
Blockcap | Developed Technology Intangibles | ||||
Business Acquisition [Line Items] | ||||
Business combination, finite-lived intangibles acquired | $ 2,800 | |||
Acquired finite-lived intangible assets, weighted average useful life | 3 years | |||
Blockcap | Customer Relationships | ||||
Business Acquisition [Line Items] | ||||
Business combination, finite-lived intangibles acquired | $ 100 | |||
Blockcap | Common Stock | ||||
Business Acquisition [Line Items] | ||||
Business combination, number of shares issued (in shares) | 113.9 | |||
Blockcap | Restricted stock and restricted stock units | ||||
Business Acquisition [Line Items] | ||||
Business combination, number of shares issued (in shares) | 6.8 | |||
Blockcap | Option on Securities | ||||
Business Acquisition [Line Items] | ||||
Business combination, number of shares issued (in shares) | 7.3 |
ACQUISITIONS, DISPOSITIONS AN_5
ACQUISITIONS, DISPOSITIONS AND RESTRUCTURING - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | Jul. 30, 2021 | Jun. 30, 2022 | Dec. 31, 2021 |
Fair value of assets acquired, and liabilities assumed: | |||
Goodwill on acquisition | $ 266,038 | $ 1,055,760 | |
Blockcap | |||
Consideration | |||
Settlement of preexisting contracts | $ (60,522) | ||
Total Consideration | 1,138,838 | ||
Fair value of assets acquired, and liabilities assumed: | |||
Cash and cash equivalents | 704 | ||
Other current assets | 633 | ||
Intangible assets, net | 2,925 | ||
Property, plant and equipment, net | 98,965 | ||
Other noncurrent assets | 1,293 | ||
Total assets acquired | 182,080 | ||
Accounts payable | 492 | ||
Accrued expenses and other | 22,647 | ||
Deferred revenue | 414 | ||
Other current liabilities | 7,204 | ||
Deferred tax liability | 9,003 | ||
Total liabilities assumed | 39,760 | ||
Total identifiable net assets | 142,320 | ||
Goodwill on acquisition | $ 996,518 | ||
Business acquisition, share price (in dollars per share) | $ 10.11 | ||
Blockcap | Common Stock | |||
Consideration | |||
Consideration, common stock issued | $ 1,151,985 | ||
Fair value of assets acquired, and liabilities assumed: | |||
Business combination, number of shares issued (in shares) | 113.9 | ||
Blockcap | Share-based Payment Arrangement | |||
Consideration | |||
Consideration, common stock issued | $ 21,768 | ||
Settlement of Blockcap debt | 25,607 | ||
Blockcap | Bitcoin (BTC) | |||
Fair value of assets acquired, and liabilities assumed: | |||
Digital assets | 73,304 | ||
Blockcap | Ethereum (ETH) | |||
Fair value of assets acquired, and liabilities assumed: | |||
Digital assets | 365 | ||
Blockcap | Digital assets-Bitcoin cash | |||
Fair value of assets acquired, and liabilities assumed: | |||
Digital assets | 8 | ||
Blockcap | Siacoin (SC) | |||
Fair value of assets acquired, and liabilities assumed: | |||
Digital assets | 554 | ||
Blockcap | Digital assets-Other | |||
Fair value of assets acquired, and liabilities assumed: | |||
Digital assets | $ 3,329 |
ACQUISITIONS, DISPOSITIONS AN_6
ACQUISITIONS, DISPOSITIONS AND RESTRUCTURING - Restructuring (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | |||
Intangible assets, amount ceased to be used | $ 2,000 | $ 2,000 | |
Impairment of intangible assets (excluding goodwill) | 2,000 | ||
Impairment of goodwill and other intangibles | 788,722 | $ 0 | |
Mining Segment [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Impairment of goodwill and other intangibles | 788,722 | ||
2022 Restructuring | Employee Severance | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance expense | $ 1,400 | $ 1,400 |
GOODWILL - Schedule of Goodwill
GOODWILL - Schedule of Goodwill (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 1,055,760 | |
Subsequent measurement period adjustment | (1,000) | |
Impairment of goodwill and other intangibles | (788,722) | $ 0 |
Goodwill, ending balance | 266,038 | 1,055,760 |
Equipment Sales and Hosting Segment | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 58,241 | |
Subsequent measurement period adjustment | 0 | |
Impairment of goodwill and other intangibles | 0 | |
Goodwill, ending balance | 58,241 | 58,241 |
Mining Segment | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 997,519 | |
Subsequent measurement period adjustment | (1,000) | |
Impairment of goodwill and other intangibles | (788,722) | |
Goodwill, ending balance | $ 207,797 | $ 997,519 |
GOODWILL - Narrative (Details)
GOODWILL - Narrative (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Goodwill [Line Items] | ||
Goodwill | $ 266,038 | $ 1,055,760 |
Accumulated goodwill impairment loss | 788,700 | |
Impairment of goodwill and other intangibles | 788,722 | 0 |
Mining Segment | ||
Goodwill [Line Items] | ||
Goodwill | 207,797 | 997,519 |
Impairment of goodwill and other intangibles | 788,722 | |
Equipment Sales and Hosting Segment | ||
Goodwill [Line Items] | ||
Goodwill | 58,241 | $ 58,241 |
Impairment of goodwill and other intangibles | $ 0 | |
Fair value over carrying value, percent | 136% |
DERIVATIVE WARRANT LIABILITIES
DERIVATIVE WARRANT LIABILITIES (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Temporary Equity [Line Items] | ||||
Warrants outstanding (in shares) | 14,900,000 | 14,900,000 | ||
Class of warrant or right, minimum threshold written notice period for redemption of warrants | 30 days | |||
Common stock issued per warrant exercised (in shares) | 1 | 1 | ||
Exercise price of warrants (in dollars per share) | $ 11.5 | $ 11.5 | ||
Warrants term | 5 years | 5 years | ||
Derivative warrant liabilities | $ 5,800 | $ 5,800 | ||
Fair value adjustment on derivative warrant liabilities | $ (22,189) | $ 0 | $ (32,464) | $ 0 |
Public Warrants | ||||
Temporary Equity [Line Items] | ||||
Warrants outstanding (in shares) | 8,600,000 | 8,600,000 | ||
Fair value adjustment on derivative warrant liabilities | $ 12,900 | $ 18,800 | ||
Public Warrants | Redemption of Warrants When Price Per Share of Class Common Stock Equals or Exceeds $18.00 | ||||
Temporary Equity [Line Items] | ||||
Class of warrant or right, minimum threshold written notice period for redemption of warrants | 30 days | |||
Redemption of warrants or rights, stock price trigger (in dollars per share) | $ 18 | $ 18 | ||
Redemption price (in dollars per share) | 0.01 | $ 0.01 | ||
Threshold trading days | 20 days | |||
Threshold consecutive trading days | 30 days | |||
Public Warrants | Redemption of Warrants When Price Per Share of Class Common Stock Equals or Exceeds $10.00 | ||||
Temporary Equity [Line Items] | ||||
Class of warrant or right, minimum threshold written notice period for redemption of warrants | 30 days | |||
Redemption of warrants or rights, stock price trigger (in dollars per share) | 10 | $ 10 | ||
Redemption price (in dollars per share) | $ 0.1 | $ 0.1 | ||
Threshold trading days | 20 days | |||
Threshold consecutive trading days | 30 days | |||
Threshold trading days following the date on which the notice of redemption is sent | 10 days | |||
Common stock issued per warrant exercised (in shares) | 0.361 | 0.361 | ||
Private Placement Warrants | ||||
Temporary Equity [Line Items] | ||||
Warrants outstanding (in shares) | 6,300,000 | 6,300,000 | ||
Fair value adjustment on derivative warrant liabilities | $ 9,300 | $ 13,700 | ||
Private Placement Warrants | Redemption of Warrants When Price Per Share of Class Common Stock Equals or Exceeds $10.00 | ||||
Temporary Equity [Line Items] | ||||
Redemption of warrants or rights, stock price trigger (in dollars per share) | $ 10 | $ 10 | ||
Threshold trading days | 10 days |
NOTES PAYABLE - Schedule of Not
NOTES PAYABLE - Schedule of Notes Payable (Details) $ in Thousands | Jun. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) |
Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 883,938 | $ 696,486 |
Unamortized discount and debt issuance costs | (4,214) | (3,187) |
Fair value adjustment on convertible notes | 190,273 | 34,910 |
Total notes payable, net | 1,069,997 | 728,209 |
Kentucky note | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | 784 | 1,032 |
Genesis loan | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | 0 | 552 |
NYDIG loan | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | 48,642 | 67,435 |
Stockholder loan | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | 10,000 | 10,000 |
Trinity loan | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | 26,148 | 19,641 |
Bremer loan | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | 20,116 | 15,066 |
Blockfi loan | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | 60,652 | 60,000 |
Anchor Labs loan | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | 30,016 | 0 |
Mass Mutual Barings loans | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | 65,550 | 0 |
B. Riley Bridge Notes | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | 75,000 | 0 |
Liberty loan | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 8,676 | 0 |
Secured Convertible Notes | ||
Debt Instrument [Line Items] | ||
Convertible debt, valuation technique, ratio of minimum payoff at maturity to carry value | 2 | |
Convertible debt, present value of future minimum payments | $ 455,100 | 441,700 |
Secured Convertible Notes | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 227,528 | 220,871 |
Other Convertible Notes | ||
Debt Instrument [Line Items] | ||
Convertible debt, valuation technique, ratio of minimum payoff at maturity to carry value | 1 | |
Other Convertible Notes | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 308,753 | 301,226 |
Other | Notes Payable | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 2,073 | $ 663 |
NOTES PAYABLE - Narrative (Deta
NOTES PAYABLE - Narrative (Details) $ / shares in Units, $ in Thousands, shares in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||||||||||||||||||
May 31, 2022 USD ($) | Apr. 30, 2022 USD ($) | Mar. 31, 2022 USD ($) | Feb. 28, 2022 USD ($) | Jan. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) AGREEMENT | Nov. 30, 2021 USD ($) | Oct. 31, 2021 USD ($) TRANCHES | Aug. 31, 2021 USD ($) | Jul. 31, 2021 USD ($) | May 31, 2021 USD ($) | Apr. 30, 2021 USD ($) | Mar. 31, 2021 USD ($) | Jan. 31, 2021 USD ($) $ / shares shares | Oct. 31, 2020 USD ($) | Jul. 31, 2020 USD ($) Day | Dec. 31, 2018 USD ($) | Jun. 30, 2022 USD ($) EMPLOYEE $ / shares shares | Mar. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) AGREEMENT | Jun. 30, 2022 USD ($) EMPLOYEE $ / shares shares | Dec. 31, 2022 | Jan. 19, 2022 $ / shares | Nov. 30, 2011 | |
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Warrants outstanding (in shares) | shares | 14.9 | 14.9 | ||||||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 11.5 | $ 11.5 | ||||||||||||||||||||||
Warrants term | 5 years | 5 years | ||||||||||||||||||||||
Convertible debt, conversion price (in dollars per share) | $ / shares | $ 8 | |||||||||||||||||||||||
Conversion of Convertible Notes | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt conversion, converted amount | $ 1,600 | $ 1,600 | ||||||||||||||||||||||
Debt conversion, converted instrument, shares issued (in shares) | shares | 0.2 | 0.2 | ||||||||||||||||||||||
Stockholder Loan Warrants | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Warrants outstanding (in shares) | shares | 0.2 | |||||||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 4.21 | |||||||||||||||||||||||
Proceeds from issuance of warrants | $ 500 | |||||||||||||||||||||||
Equipment Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Interest rate per annum | 13.10% | 13.10% | ||||||||||||||||||||||
Convertible Notes | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Note payable face amount | $ 514,800 | $ 514,800 | ||||||||||||||||||||||
Interest rate per annum | 10% | 10% | ||||||||||||||||||||||
Paid-in-kind interest | $ 23,000 | |||||||||||||||||||||||
Convertible notes payable, payable in cash percent | 4% | 4% | 4% | 4% | ||||||||||||||||||||
Convertible debt, conversion price (in dollars per share) | $ / shares | 8 | |||||||||||||||||||||||
Convertible notes payable, payable in kind percent | 6% | 6% | 6% | 6% | ||||||||||||||||||||
Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | $ 696,486 | $ 883,938 | $ 696,486 | $ 883,938 | ||||||||||||||||||||
Kentucky note | Secured Promissory Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, term | 5 years | |||||||||||||||||||||||
Note payable face amount | $ 2,400 | |||||||||||||||||||||||
Interest rate per annum | 5% | |||||||||||||||||||||||
Effective interest rate | 5% | |||||||||||||||||||||||
Kentucky note | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | 1,032 | 784 | 1,032 | 784 | ||||||||||||||||||||
Genesis loan | Secured Debt | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 13,000 | |||||||||||||||||||||||
Proceeds from lines of credit | $ 5,300 | |||||||||||||||||||||||
Genesis loan | Secured Debt | Line of Credit | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, term | 20 months | |||||||||||||||||||||||
Interest rate per annum | 16% | |||||||||||||||||||||||
Effective interest rate | 28% | |||||||||||||||||||||||
Number of installment | Day | 3 | |||||||||||||||||||||||
Genesis loan | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | 552 | 0 | 552 | 0 | ||||||||||||||||||||
NYDIG loan | Equipment Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, term | 24 months | 24 months | 24 months | 24 months | ||||||||||||||||||||
Interest rate per annum | 14.25% | 14.25% | 15% | 11% | ||||||||||||||||||||
Effective interest rate | 16% | 17% | 16% | 11% | ||||||||||||||||||||
Proceeds from issuance of debt | $ 33,400 | $ 26,100 | $ 13,400 | $ 3,800 | $ 800 | |||||||||||||||||||
NYDIG loan | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | 67,435 | 48,642 | 67,435 | 48,642 | ||||||||||||||||||||
Stockholder loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Warrants term | 2 years | |||||||||||||||||||||||
Stockholder loan | Equipment Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, term | 2 years | |||||||||||||||||||||||
Note payable face amount | $ 10,000 | |||||||||||||||||||||||
Interest rate per annum | 10% | |||||||||||||||||||||||
Effective interest rate | 20% | |||||||||||||||||||||||
Proceeds from issuance of debt | $ 9,500 | |||||||||||||||||||||||
Stockholder loan | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | 10,000 | 10,000 | 10,000 | 10,000 | ||||||||||||||||||||
Trinity loan | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | 19,641 | 26,148 | 19,641 | 26,148 | ||||||||||||||||||||
Trinity loan | Revolving Credit Facility | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Effective interest rate | 11% | |||||||||||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 30,000 | |||||||||||||||||||||||
Proceeds from lines of credit | 5,000 | 14,000 | $ 1,000 | |||||||||||||||||||||
Proceeds from issuance of debt | $ 10,000 | |||||||||||||||||||||||
Line of credit facility, expiration period | 36 months | |||||||||||||||||||||||
Bremer loan | Equipment Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, term | 60 months | |||||||||||||||||||||||
Interest rate per annum | 5.50% | |||||||||||||||||||||||
Effective interest rate | 5.60% | |||||||||||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 16,200 | |||||||||||||||||||||||
Proceeds from lines of credit | $ 700 | $ 4,800 | 15,200 | |||||||||||||||||||||
Number of installment | TRANCHES | 2 | |||||||||||||||||||||||
Line of credit facility, additional borrowing capacity | $ 9,600 | $ 9,600 | ||||||||||||||||||||||
Debt instrument, covenant terms, fixed charge coverage ratio | 1 | 1 | ||||||||||||||||||||||
Debt instrument, interest rate buydown, amount | $ 800 | $ 800 | ||||||||||||||||||||||
Debt instrument, interest rate buydown terms, minimum continued operation period required | 5 years | |||||||||||||||||||||||
Minimum number of additional full time employees | EMPLOYEE | 13 | 13 | ||||||||||||||||||||||
Interest rate buydown terms, full time employee employment period | 2 years | |||||||||||||||||||||||
Bremer loan | Equipment Loan | Forecast | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, covenant terms, minimum debt service coverage ratio | 1.2 | |||||||||||||||||||||||
Bremer loan | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | $ 15,066 | $ 20,116 | $ 15,066 | $ 20,116 | ||||||||||||||||||||
Blockfi loan | Equipment Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Effective interest rate | 13.10% | 13.10% | ||||||||||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 110,000 | $ 110,000 | ||||||||||||||||||||||
Proceeds from lines of credit | $ 20,000 | $ 60,000 | ||||||||||||||||||||||
Debt instrument, number of lending agreements | AGREEMENT | 2 | 2 | ||||||||||||||||||||||
Line of credit facility, remaining borrowing capacity | 30,000 | 30,000 | ||||||||||||||||||||||
Blockfi loan | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | $ 60,000 | 60,652 | $ 60,000 | 60,652 | ||||||||||||||||||||
Blockfi Loan, Credit Agreement One | Equipment Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, term | 24 months | |||||||||||||||||||||||
Interest rate per annum | 9.70% | 9.70% | ||||||||||||||||||||||
Effective interest rate | 10.10% | 10.10% | ||||||||||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 10,000 | $ 10,000 | ||||||||||||||||||||||
Blockfi Loan, Credit Agreement Two | Equipment Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Line of credit facility, maximum borrowing capacity | 100,000 | 100,000 | ||||||||||||||||||||||
Anchor Labs loan | Equipment Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, term | 24 months | 24 months | ||||||||||||||||||||||
Note payable face amount | $ 11,700 | $ 20,000 | $ 20,000 | |||||||||||||||||||||
Effective interest rate | 12.50% | 12.50% | 12.50% | |||||||||||||||||||||
Proceeds from lines of credit | $ 11,700 | $ 20,000 | ||||||||||||||||||||||
Anchor Labs loan | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | 0 | 30,016 | 0 | 30,016 | ||||||||||||||||||||
Mass Mutual Barings loans | Equipment Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, term | 36 months | |||||||||||||||||||||||
Note payable face amount | $ 100,000 | $ 100,000 | ||||||||||||||||||||||
Effective interest rate | 9.80% | 9.80% | ||||||||||||||||||||||
Proceeds from lines of credit | $ 30,000 | $ 39,600 | ||||||||||||||||||||||
Unused borrowing capacity, amount | 30,400 | 30,400 | ||||||||||||||||||||||
Mass Mutual Barings loans | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | 0 | 65,550 | 0 | 65,550 | ||||||||||||||||||||
B. Riley Bridge Notes | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | 0 | 75,000 | 0 | 75,000 | ||||||||||||||||||||
B. Riley Bridge Notes | Bridge Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Effective interest rate | 7% | |||||||||||||||||||||||
B. Riley Bridge Notes | Bridge Loan | B. Riley Commercial Capital, LLC | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Note payable face amount | $ 60,000 | |||||||||||||||||||||||
B. Riley Bridge Notes | Bridge Loan | Affiliate Of B. Riley Commercial Capital, LLC | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Note payable face amount | $ 15,000 | |||||||||||||||||||||||
Liberty loan | Equipment Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, term | 24 months | |||||||||||||||||||||||
Note payable face amount | $ 11,000 | |||||||||||||||||||||||
Effective interest rate | 10.60% | |||||||||||||||||||||||
Proceeds from lines of credit | $ 11,000 | |||||||||||||||||||||||
Liberty loan | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | 0 | $ 8,676 | 0 | $ 8,676 | ||||||||||||||||||||
Secured Convertible Notes | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Convertible debt, conversion price, percentage of financing price | 80% | 80% | ||||||||||||||||||||||
Convertible debt, valuation technique, ratio of minimum payoff at maturity to carry value | 2 | 2 | ||||||||||||||||||||||
Convertible debt, amount owed if held to maturity | $ 455,100 | $ 455,100 | ||||||||||||||||||||||
Convertible debt, amount owed if prepaid | 777,200 | 777,200 | ||||||||||||||||||||||
Secured Convertible Notes | Convertible Notes | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Note payable face amount | $ 215,000 | |||||||||||||||||||||||
Secured Convertible Notes | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | 220,871 | 227,528 | 220,871 | 227,528 | ||||||||||||||||||||
Unsecured Convertible Notes Issued Aug-Nov 2021 | Convertible Notes | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Note payable face amount | $ 299,800 | |||||||||||||||||||||||
Stockholder loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Repayments of debt | $ 30,000 | |||||||||||||||||||||||
Convertible Notes Mature In April 2025 | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Convertible debt, conversion price (in dollars per share) | $ / shares | $ 8 | |||||||||||||||||||||||
Convertible debt, conversion price, percentage of financing price | 80% | |||||||||||||||||||||||
Convertible Notes Mature In April 2025 | Estimate of Fair Value Measurement | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Convertible notes payable, fair value | 557,007 | 726,554 | 557,007 | 726,554 | ||||||||||||||||||||
Convertible Notes Mature In April 2025 | Principal | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Convertible notes payable, fair value | 522,097 | 536,281 | 522,097 | 536,281 | ||||||||||||||||||||
Convertible Notes Mature In April 2025 | Level 2 | Estimate of Fair Value Measurement | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Convertible notes payable, fair value | 0 | 0 | 0 | 0 | ||||||||||||||||||||
Convertible Notes Mature In April 2025 | Fair Value, Recurring | Estimate of Fair Value Measurement | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Convertible notes payable, fair value | 726,600 | 726,600 | ||||||||||||||||||||||
Convertible Notes Mature In April 2025 | Fair Value, Recurring | Level 2 | Principal | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Convertible notes payable, fair value | 536,300 | 536,300 | ||||||||||||||||||||||
Convertible Notes Mature In April 2025 | Convertible Notes | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt issuance costs | 13,100 | |||||||||||||||||||||||
Convertible Notes Mature In April 2025 | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | $ 536,300 | $ 536,300 | ||||||||||||||||||||||
Other Convertible Notes | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Convertible debt, conversion price, percentage of financing price | 80% | 80% | ||||||||||||||||||||||
Convertible debt, valuation technique, ratio of minimum payoff at maturity to carry value | 1 | 1 | ||||||||||||||||||||||
Other Convertible Notes | Notes Payable | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable | $ 301,226 | $ 308,753 | $ 301,226 | $ 308,753 |
NOTES PAYABLE - Schedule of Fai
NOTES PAYABLE - Schedule of Fair Value Adjustments and Debt Issuance Costs (Details) - Convertible Notes Mature In April 2025 - Convertible Notes - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Debt Instrument [Line Items] | ||||
Liabilities, fair value adjustment | $ (190,256) | $ 4,300 | $ 181,695 | $ 4,300 |
Interest Expense | ||||
Debt Instrument [Line Items] | ||||
Liabilities, fair value adjustment | 5,581 | 5,581 | ||
Cash interest payments | Interest Expense | ||||
Debt Instrument [Line Items] | ||||
Liabilities, fair value adjustment | 5,355 | 1,720 | 10,582 | 1,720 |
Payment-in-kind (PIK) interest | Interest Expense | ||||
Debt Instrument [Line Items] | ||||
Liabilities, fair value adjustment | 8,032 | 2,580 | 15,883 | 2,580 |
Instrument-specific credit risk | Other Comprehensive Income (Loss) | ||||
Debt Instrument [Line Items] | ||||
Liabilities, fair value adjustment | (8,582) | 0 | (35,746) | 0 |
Other fair value adjustments | Fair value adjustment on convertible notes | ||||
Debt Instrument [Line Items] | ||||
Liabilities, fair value adjustment | $ (195,061) | $ 0 | $ 190,976 | $ 0 |
REVENUE (Details)
REVENUE (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |||||
Deferred revenue | $ 108.8 | $ 108.8 | $ 136.4 | ||
Deferred revenue recognized | 3.9 | $ 8.9 | 40.7 | $ 35.8 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||||
Performance obligation not yet recognized | $ 900.8 | $ 427.5 | $ 900.8 | $ 427.5 | |
Minimum | |||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||||
Contract with customer, term | 18 months | ||||
Maximum | |||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||||
Contract with customer, term | 48 months |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jan. 19, 2022 $ / shares | Dec. 31, 2021 USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Convertible debt, conversion price (in dollars per share) | $ / shares | $ 8 | |||||
Losses on exchange or disposal of property, plant and equipment | $ (13,057) | $ (17) | $ (13,057) | $ (17) | ||
Impairment of goodwill and other intangibles | 790,753 | 0 | 790,753 | 0 | ||
Impairment of digital assets | 150,213 | 0 | 204,198 | 0 | ||
Gain (loss) from sales of digital assets | 11,808 | $ (16) | 13,971 | $ 14 | ||
Notes payable | 726,554 | 726,554 | $ 557,007 | |||
Level 3 | Valuation Technique, Discounted Cash Flow | Estimate of Fair Value Measurement | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Notes payable | 350,300 | 350,300 | 184,700 | |||
Level 3 | Valuation Technique, Discounted Cash Flow | Principal | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Notes payable | $ 343,400 | $ 343,400 | $ 171,200 | |||
Secured Convertible Notes | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Convertible debt, valuation technique, ratio of minimum payoff at maturity to carry value | 2 | 2 | ||||
Convertible debt, valuation technique, stock appreciation percentage | 60% | 60% | ||||
Convertible debt, conversion price, percentage of financing price | 80% | 80% | ||||
Other Convertible Notes | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Convertible debt, valuation technique, ratio of minimum payoff at maturity to carry value | 1 | 1 | ||||
Convertible debt, conversion price, percentage of financing price | 80% | 80% | ||||
Convertible debt, valuation technique, stock depreciation percentage | 20 | 20 | ||||
Convertible Notes Mature In April 2025 | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Convertible debt, conversion price, percentage of financing price | 80% | |||||
Convertible debt, conversion price (in dollars per share) | $ / shares | $ 8 |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of Fair Value Hierarchy of Convertible Notes (Details) $ in Thousands | Jun. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) |
Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | $ 0 | |
Liabilities, fair value | 536,281 | |
Principal | Public Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 0 | |
Principal | Private Placement Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 0 | |
Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 5,808 | |
Liabilities, fair value | 732,362 | |
Estimate of Fair Value Measurement | Public Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 3,364 | |
Estimate of Fair Value Measurement | Private Placement Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 2,444 | |
Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 3,364 | |
Liabilities, fair value | 3,364 | |
Estimate of Fair Value Measurement | Level 1 | Public Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 3,364 | |
Estimate of Fair Value Measurement | Level 1 | Private Placement Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 0 | |
Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 2,444 | |
Liabilities, fair value | 2,444 | |
Estimate of Fair Value Measurement | Level 2 | Public Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 0 | |
Estimate of Fair Value Measurement | Level 2 | Private Placement Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 2,444 | |
Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 0 | |
Liabilities, fair value | 726,554 | |
Estimate of Fair Value Measurement | Level 3 | Public Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 0 | |
Estimate of Fair Value Measurement | Level 3 | Private Placement Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative warrant liability, fair value | 0 | |
Convertible Notes Mature In April 2025 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 536,281 | $ 522,097 |
Accrued PIK interest | 0 | 0 |
Convertible Notes Mature In April 2025 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 726,554 | 557,007 |
Accrued PIK interest | 8,031 | 7,896 |
Convertible Notes Mature In April 2025 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Accrued PIK interest | 0 | 0 |
Convertible Notes Mature In April 2025 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Accrued PIK interest | 0 | 0 |
Convertible Notes Mature In April 2025 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 726,554 | 557,007 |
Accrued PIK interest | $ 8,031 | 7,896 |
Other Convertible Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible debt, valuation technique, ratio of minimum payoff at maturity to carry value | 1 | |
Convertible Notes Issued On April 19, 2021 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | $ 94,186 | 91,430 |
Convertible Notes Issued On April 19, 2021 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 172,610 | 101,078 |
Convertible Notes Issued On April 19, 2021 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On April 19, 2021 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On April 19, 2021 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 172,610 | 101,078 |
Convertible Notes Issued On April 21, 2021 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 5,291 | 5,137 |
Convertible Notes Issued On April 21, 2021 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 9,697 | 5,674 |
Convertible Notes Issued On April 21, 2021 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On April 21, 2021 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On April 21, 2021 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 9,697 | 5,674 |
Convertible Notes Issued On April 23, 2021 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 47,622 | 46,229 |
Convertible Notes Issued On April 23, 2021 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 87,275 | 51,062 |
Convertible Notes Issued On April 23, 2021 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On April 23, 2021 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On April 23, 2021 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 87,275 | 51,062 |
Convertible Notes Issued On April 26, 2021 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 80,429 | 78,075 |
Convertible Notes Issued On April 26, 2021 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 147,398 | 86,165 |
Convertible Notes Issued On April 26, 2021 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On April 26, 2021 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On April 26, 2021 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 147,398 | 86,165 |
Convertible Notes Issued On August 20, 2021 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 52,122 | 50,597 |
Convertible Notes Issued On August 20, 2021 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 49,635 | 50,941 |
Convertible Notes Issued On August 20, 2021 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On August 20, 2021 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On August 20, 2021 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 49,635 | 50,941 |
Convertible Notes Issued On September 10, 2021 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 15,559 | 16,110 |
Convertible Notes Issued On September 10, 2021 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 15,272 | 16,472 |
Convertible Notes Issued On September 10, 2021 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On September 10, 2021 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On September 10, 2021 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 15,272 | 16,472 |
Convertible Notes Issued On September 23, 2021 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 77,825 | 76,051 |
Convertible Notes Issued On September 23, 2021 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 76,393 | 77,559 |
Convertible Notes Issued On September 23, 2021 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On September 23, 2021 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On September 23, 2021 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 76,393 | 77,559 |
Convertible Notes Issued On September 24, 2021 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 61,825 | 60,016 |
Convertible Notes Issued On September 24, 2021 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 60,687 | 61,179 |
Convertible Notes Issued On September 24, 2021 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On September 24, 2021 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On September 24, 2021 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 60,687 | 61,179 |
Convertible Notes Issued On September 27, 2021 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 2,034 | 1,974 |
Convertible Notes Issued On September 27, 2021 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 1,996 | 2,012 |
Convertible Notes Issued On September 27, 2021 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On September 27, 2021 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On September 27, 2021 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 1,996 | 2,012 |
Convertible Notes Issued On October 1, 2021 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 89,269 | 86,655 |
Convertible Notes Issued On October 1, 2021 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 87,627 | 87,150 |
Convertible Notes Issued On October 1, 2021 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On October 1, 2021 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On October 1, 2021 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 87,627 | 87,150 |
Convertible Notes Issued On November 10, 2021 | Principal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 10,119 | 9,823 |
Convertible Notes Issued On November 10, 2021 | Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 9,933 | 9,819 |
Convertible Notes Issued On November 10, 2021 | Estimate of Fair Value Measurement | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On November 10, 2021 | Estimate of Fair Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | 0 | 0 |
Convertible Notes Issued On November 10, 2021 | Estimate of Fair Value Measurement | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible notes payable, fair value | $ 9,933 | $ 9,819 |
FAIR VALUE MEASUREMENTS - Activ
FAIR VALUE MEASUREMENTS - Activity of Convertible Notes Measured at Fair Value (Details) - Level 3 - Convertible Notes - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2022 | Mar. 31, 2022 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Fair value, beginning balance | $ 923,731 | $ 557,007 |
Issuances (including PIK principal recorded) | 7,851 | 7,896 |
Settlements (including interest payments, PIK principal recorded and conversions) | (14,772) | (13,123) |
Unrealized gains | (190,256) | 371,951 |
Fair value, ending balance | $ 726,554 | $ 923,731 |
FAIR VALUE MEASUREMENTS - Sch_2
FAIR VALUE MEASUREMENTS - Schedule of Convertible Debt Fair Value Measurement Input (Details) - Convertible Notes | Jun. 30, 2022 d |
Fair value | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Convertible note fair value measurement input | 726,554 |
Expected term (years) | Minimum | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Convertible note fair value measurement input | 2.8 |
Expected term (years) | Maximum | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Convertible note fair value measurement input | 2.8 |
Expected term (years) | Weighted Average | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Convertible note fair value measurement input | 2.8 |
Volatility | Minimum | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Convertible note fair value measurement input | 46.3 |
Volatility | Maximum | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Convertible note fair value measurement input | 46.3 |
Volatility | Weighted Average | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Convertible note fair value measurement input | 46.3 |
FAIR VALUE MEASUREMENTS - Sch_3
FAIR VALUE MEASUREMENTS - Schedule of Digital Currency Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Indefinite-lived Intangible Assets [Line Items] | ||
Digital assets | $ 40,664 | $ 234,298 |
Bitcoin (BTC) | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Digital assets | 37,646 | 224,843 |
Ethereum (ETH) | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Digital assets | 1,200 | 4,665 |
Polygon (MATIC) | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Digital assets | 182 | 1,085 |
Siacoin (SC) | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Digital assets | 0 | 803 |
Dai (DAI) | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Digital assets | 0 | 1,353 |
Digital assets-Other | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Digital assets | $ 1,636 | $ 1,549 |
LEASES - Schedule of Assets and
LEASES - Schedule of Assets and Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Jan. 01, 2022 |
Assets: | ||
Operating lease right-of-use assets | $ 6,401 | $ 6,700 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other noncurrent assets | Other noncurrent assets |
Finance lease right-of-use assets | $ 97,655 | |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property, plant and equipment, net | |
Liabilities: | ||
Operating lease liabilities, current portion | $ 75 | $ 200 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued expenses and other | |
Operating lease liabilities, net of current portion | $ 1,127 | $ 1,200 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other noncurrent liabilities | |
Finance lease liabilities, current portion | $ 28,570 | |
Finance lease liabilities, net of current portion | $ 48,701 |
LEASES - Schedule of Lease Cost
LEASES - Schedule of Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 | Jun. 30, 2022 | |
Leases [Abstract] | ||
Operating lease expense | $ 154 | $ 309 |
Short-term lease expense | 287 | 477 |
Finance lease expense: | ||
Amortization of right-of-use assets | 8,699 | 18,523 |
Interest on lease liabilities | 2,248 | 4,339 |
Total finance lease expense | 10,947 | 22,862 |
Total lease expense | $ 11,388 | $ 23,648 |
LEASES - Schedule of Lease Term
LEASES - Schedule of Lease Term and Discount Rate (Details) | Jun. 30, 2022 |
Leases [Abstract] | |
Operating lease, weighted average remaining lease term | 21 years 6 months |
Finance lease, weighted average remaining lease term | 2 years 6 months |
Operating lease, weighted average discount rate | 6.40% |
Finance lease, weighted average discount rate | 11% |
LEASES - Schedule of Lease Liab
LEASES - Schedule of Lease Liability, Maturity (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Operating Leases | |
Remaining 2022 | $ 69 |
2023 | 170 |
2024 | 170 |
2025 | 170 |
2026 | 170 |
2027 | 170 |
Thereafter | 1,251 |
Total lease payments | 2,170 |
Less: imputed interest | 968 |
Total | 1,202 |
Finance Leases | |
Remaining 2022 | 18,131 |
2023 | 34,948 |
2024 | 31,332 |
2025 | 4,509 |
2026 | 3 |
2027 | 0 |
Thereafter | 0 |
Total lease payments | 88,923 |
Less: imputed interest | 11,652 |
Total | $ 77,271 |
LEASES - Schedule of Supplement
LEASES - Schedule of Supplemental Cash Flow Statement (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 | Jun. 30, 2022 | |
Leases [Abstract] | ||
Operating lease payments | $ 101 | $ 202 |
Finance lease payments | 15,169 | 27,526 |
Operating lease right-of-use assets obtained in exchange for lease obligations | 0 | 0 |
Finance lease right-of-use assets obtained in exchange for lease obligations | $ 0 | $ 10,557 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) $ in Thousands | 1 Months Ended | |||
Dec. 31, 2021 USD ($) | Sep. 30, 2021 USD ($) MW Option | Jun. 30, 2022 USD ($) | Jan. 01, 2022 USD ($) | |
Lessee, Lease, Description [Line Items] | ||||
Operating lease right-of-use assets | $ 6,401 | $ 6,700 | ||
Lessee, operating lease, not yet commenced, amount | $ 14,000 | |||
Lease not yet commenced, term of contract | 130 months | |||
Minnkota Power Cooperative | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease right-of-use assets | $ 5,300 | |||
Purchase obligation | $ 2,600 | |||
Initial term of contract | 5 years | |||
Number of renewal options | Option | 5 | |||
Renewal term | 5 years | |||
Lessee option to purchase underlying asset, purchase price | $ 5,600 | |||
Power supply to be purchased | MW | 100 | |||
Minnkota Power Cooperative | Minimum | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease, term (less than) | 5 years | |||
Minnkota Power Cooperative | Maximum | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease, term (less than) | 30 years | |||
Liberty Commercial Finance LLC | ||||
Lessee, Lease, Description [Line Items] | ||||
Finance lease obligations | $ 40,900 | |||
Remaining lease term | 3 years 2 months 12 days | |||
Effective interest rate | 12.60% | |||
MassMutual Asset Finance LLC | ||||
Lessee, Lease, Description [Line Items] | ||||
Finance lease obligations | $ 50,000 | |||
Remaining lease term | 3 years 2 months 12 days | |||
Effective interest rate | 10% |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Loss contingency accrual | $ 0 | $ 0 |
Purchase obligation | 192,400,000 | |
Purchase obligation, amounts paid | 130,800,000 | |
Purchase obligation, to be paid within one year | $ 61,600,000 |
CONTINGENTLY REDEEMABLE CONVE_2
CONTINGENTLY REDEEMABLE CONVERTIBLE PREFERRED STOCK (Details) | 6 Months Ended | |||
Jun. 30, 2022 $ / shares shares | Jan. 19, 2022 | Jan. 18, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares | |
Class of Stock [Line Items] | ||||
Contingently redeemable preferred stock, shares authorized (in shares) | 2,000,000,000 | 50,000,000 | 2,000,000,000 | |
Contingently redeemable preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Contingently redeemable preferred stock, shares outstanding (in shares) | 0 | 10,826,000 | ||
Contingently redeemable preferred stock, shares issued (in shares) | 0 | 10,826,000 | ||
Common stock, exchange ratio | 1.6001528688 | |||
Contingently Redeemable convertible preferred stock | ||||
Class of Stock [Line Items] | ||||
Conversion of contingently redeemable preferred stock to common stock (in shares) | 10,800,000 |
STOCKHOLDERS' EQUITY - Narrativ
STOCKHOLDERS' EQUITY - Narrative (Details) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||||||
Jan. 19, 2022 $ / shares shares | Jul. 31, 2022 shares | Mar. 31, 2022 shares | Feb. 28, 2022 shares | Jul. 31, 2021 USD ($) | Jun. 30, 2022 USD ($) Vote $ / shares shares | Jun. 30, 2022 USD ($) Vote $ / shares shares | Jun. 08, 2022 shares | Jan. 18, 2022 $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Jan. 31, 2021 $ / shares shares | Mar. 31, 2020 $ / shares shares | |
Class of Stock [Line Items] | ||||||||||||
Common stock, shares authorized (in shares) | 10,000,000,000 | 10,000,000,000 | 10,000,000,000 | |||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.00001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||
Voting rights per share | Vote | 1 | 1 | ||||||||||
Warrants outstanding (in shares) | 14,900,000 | 14,900,000 | ||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 11.5 | $ 11.5 | ||||||||||
Common stock, exchange ratio | 1.6001528688 | |||||||||||
Convertible debt, conversion price (in dollars per share) | $ / shares | $ 8 | |||||||||||
SPAC vesting shares (in shares) | 1,700,000 | |||||||||||
Issuances of common stock- vendor settlement (in shares) | 1,600,000 | |||||||||||
Number of consecutive days | 30 days | |||||||||||
Lockup period | 180 days | |||||||||||
Vendor liability, contractual amount | $ | $ 21.3 | |||||||||||
Vendor liability, changes in fair value | $ | $ 9.8 | $ 9.4 | ||||||||||
Vendor liability, fair value | $ | $ 18.1 | $ 18.1 | ||||||||||
Share-based compensation, award vesting period | 1 year | |||||||||||
Number of common shares available for grant, outstanding (in shares) | 82,700,000 | 82,700,000 | ||||||||||
Common shares purchased for award (in shares) | 30,600,000 | 30,600,000 | ||||||||||
Weighted average price of shares purchased (in shares) | $ / shares | $ 9.02 | $ 9.02 | ||||||||||
Options remaining contractual term | 3 years 4 months 24 days | |||||||||||
Option, unrecognized share-based compensation expense | $ | $ 131.4 | $ 131.4 | ||||||||||
Period for recognition | 3 years | |||||||||||
Convertible Notes | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Note payable face amount | $ | $ 514.8 | |||||||||||
Paid-in-kind interest | $ | 23 | |||||||||||
Convertible debt, conversion price (in dollars per share) | $ / shares | $ 8 | |||||||||||
Conversion of Convertible Notes | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Debt conversion, converted amount | $ | $ 1.6 | $ 1.6 | ||||||||||
Debt conversion, converted instrument, shares issued (in shares) | 200,000 | 200,000 | ||||||||||
Conversion of XPDI's Common Stock to New Core Common Stock | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Recapitalization transaction, conversion ratio | 1 | |||||||||||
Common Stock | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Issuances of common stock- Merger with XPDI (in shares) | 30,800,000 | |||||||||||
XPDI | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | |||||||||||
Stock options | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Period for recognition | 3 years 4 months 24 days | |||||||||||
Restricted Stock Units and Restricted Awards | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Nonvested RSAs and RSUs (in shares) | 52,100,000 | 52,100,000 | ||||||||||
RSUs and RSAs, unrecognized share-based compensation expense | $ | $ 136.8 | $ 136.8 | ||||||||||
Restricted Stock Units (RSUs) | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Restricted stock units granted in period (in shares) | 2,100,000 | 14,000,000 | ||||||||||
Restricted stock units granted (in dollars per share) | $ / shares | $ 5.45 | $ 2.78 | ||||||||||
2018 Omnibus Incentive Plan | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Share-based compensation, award vesting period | 1 year | |||||||||||
2018 Omnibus Incentive Plan | Restricted Stock Units (RSUs) | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Number of common shares to be net settled (in shares) | 42,000,000 | |||||||||||
Number of shares to be forfeited and cancelled (in shares) | 15,000,000 | |||||||||||
2018 Omnibus Incentive Plan | Maximum | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Share-based compensation, award expiration period | 10 years | |||||||||||
2021 Equity Incentive Plan | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Share-based compensation, number of shares authorized (in shares) | 45,000,000 | |||||||||||
Number of common shares available for grant (in shares) | 43,000,000 | 43,000,000 | ||||||||||
2021 Equity Incentive Plan | Stock options | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Share-based compensation, award expiration period | 10 years | |||||||||||
Stockholder Loan Warrants | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Warrants outstanding (in shares) | 200,000 | |||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 4.21 | |||||||||||
Public Warrants | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Warrants outstanding (in shares) | 8,600,000 | 8,600,000 | ||||||||||
Public Warrants | XPDI | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Warrants outstanding (in shares) | 8,600,000 | |||||||||||
Private Placement Warrants | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Warrants outstanding (in shares) | 6,300,000 | 6,300,000 | ||||||||||
Private Placement Warrants | XPDI | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Warrants outstanding (in shares) | 6,300,000 | |||||||||||
Executive Notes Warrants | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Warrants outstanding (in shares) | 6,400,000 | |||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.84 | |||||||||||
Class of warrant or right, warrants exercised | 3,200,000 | |||||||||||
Issuance of common stock - exercise of warrants (in shares) | 2,900,000 | |||||||||||
Shares withheld for tax withholding obligation (in shares) | 300,000 | |||||||||||
Service Providers Warrants | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Warrants outstanding (in shares) | 200,000 | |||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 4.27 | |||||||||||
Class of warrant or right, warrants exercised | 200,000 | |||||||||||
Issuance of common stock - exercise of warrants (in shares) | 100,000 |
STOCKHOLDERS' EQUITY - Schedule
STOCKHOLDERS' EQUITY - Schedule of Share-based Compensation Arrangements by Share-based Payment Award (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 110,998 | $ 2,136 | $ 136,795 | $ 2,724 |
Cost of revenue | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 16,882 | 0 | 18,921 | 0 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 13,177 | 0 | 15,059 | 0 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 9,132 | 0 | 9,590 | 0 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 71,807 | $ 2,136 | $ 93,225 | $ 2,724 |
INCOME TAXES - Schedule of Inco
INCOME TAXES - Schedule of Income Tax (Benefit) Expense and Effective Income Tax Rate (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Income tax (benefit) expense | $ (48,650) | $ 118 | $ (6,244) | $ 118 |
Effective income tax rate | 5.70% | (3.60%) | 0.50% | 3.30% |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Discrete tax expense | $ 400 | $ 0 | $ 7,700 | $ 0 |
Income tax expense (benefit) | $ (48,650) | $ 118 | $ (6,244) | $ 118 |
Estimated annual effective income tax rate without discrete items | 1.10% | 2.60% | ||
Effective income tax rate reconciliation, fair value adjustment on debt instrument | (2.60%) | |||
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Impairment Losses, Percent | (11.60%) | |||
Effective income tax rate reconciliation, change in deferred tax assets valuation allowance | (5.50%) | (30.50%) | ||
Effective income tax rate reconciliation, nondeductible expense, interest expense | (0.80%) | 7% | ||
Effective income tax rate reconciliation, nondeductible expense, other | 0.80% | 5.10% |
NET (LOSS) INCOME ATTRIBUTABL_3
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS - Narrative (Details) | Jan. 19, 2022 $ / shares |
Earnings Per Share [Abstract] | |
Convertible debt, conversion price (in dollars per share) | $ 8 |
Common stock, exchange ratio | 1.6001528688 |
NET (LOSS) INCOME ATTRIBUTABL_4
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Earnings Per Share [Abstract] | ||||
Net (loss) income | $ (810,475) | $ (3,414) | $ (1,276,679) | $ 3,435 |
Weighted average common shares outstanding - basic (in shares) | 324,967 | 158,890 | 316,269 | 158,338 |
Add: Dilutive share-based compensation awards (in shares) | 0 | 0 | 0 | 19,004 |
Weighted average common shares outstanding - diluted (in shares) | 324,967 | 158,890 | 316,269 | 177,342 |
Net (loss) income per share – basic (in dollars per share) | $ (2.49) | $ (0.02) | $ (4.04) | $ 0.02 |
Net (loss) income per share – diluted (in dollars per share) | $ (2.49) | $ (0.02) | $ (4.04) | $ 0.02 |
NET (LOSS) INCOME ATTRIBUTABL_5
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS - Schedule of Antidilutive Securities Excluded from Computation of Earnings (Loss) Per Share (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of net loss per share (in shares) | 170,814 | 76,834 | 170,814 | 54,832 |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of net loss per share (in shares) | 30,588 | 4,368 | 30,588 | 0 |
Preferred stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of net loss per share (in shares) | 0 | 10,826 | 0 | 0 |
Warrants | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of net loss per share (in shares) | 18,311 | 6,808 | 18,311 | 0 |
Restricted stock and restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of net loss per share (in shares) | 52,064 | 54,832 | 52,064 | 54,832 |
Convertible Notes | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of net loss per share (in shares) | 68,126 | 0 | 68,126 | 0 |
SPAC Vesting Shares | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of net loss per share (in shares) | 1,725 | 0 | 1,725 | 0 |
SEGMENT REPORTING - Schedule of
SEGMENT REPORTING - Schedule of Revenue and Gross Profit by Reporting Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 163,972 | $ 75,303 | $ 356,491 | $ 129,549 |
Cost of revenue | 151,255 | 50,765 | 273,771 | 90,478 |
Gross profit | 12,717 | 24,538 | 82,720 | 39,071 |
Hosting Service | ||||
Segment Reporting Information [Line Items] | ||||
Cost of revenue | 43,644 | 17,550 | 74,875 | 29,379 |
Equipment Sales | ||||
Segment Reporting Information [Line Items] | ||||
Cost of revenue | 13,541 | 31,100 | 36,076 | 57,331 |
Digital asset mining income | ||||
Segment Reporting Information [Line Items] | ||||
Cost of revenue | 94,070 | 2,115 | 162,820 | 3,768 |
Equipment Sales and Hosting Segment | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 54,130 | 64,538 | 113,649 | 109,156 |
Cost of revenue | 57,185 | 48,650 | 110,951 | 86,710 |
Gross profit | (3,055) | 15,888 | 2,698 | 22,446 |
Equipment Sales and Hosting Segment | Hosting Service | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 38,936 | 18,562 | 72,150 | 31,254 |
Cost of revenue | 43,644 | 17,550 | 74,875 | 29,379 |
Equipment Sales and Hosting Segment | Equipment Sales | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 15,194 | 45,976 | 41,499 | 77,902 |
Cost of revenue | 13,541 | 31,100 | 36,076 | 57,331 |
Mining Segment | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 109,842 | 10,765 | 242,842 | 20,393 |
Cost of revenue | 94,070 | 2,115 | 162,820 | 3,768 |
Gross profit | 15,772 | 8,650 | 80,022 | 16,625 |
Mining Segment | Digital asset mining income | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 109,842 | 10,765 | 242,842 | 20,393 |
Cost of revenue | $ 94,070 | $ 2,115 | $ 162,820 | $ 3,768 |
SEGMENT REPORTING - Narrative (
SEGMENT REPORTING - Narrative (Details) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) Segment | Jun. 30, 2021 USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of operating segments | Segment | 2 | |||
Mining Segment | Revenue Benchmark | Indefinite-Lived Intangible Asset Concentration Risk | Bitcoin (BTC) | ||||
Segment Reporting Information [Line Items] | ||||
Concentration risk, percentage | 67% | 68% | ||
Operating Segments | Equipment Sales and Hosting Segment | ||||
Segment Reporting Information [Line Items] | ||||
Cost of revenue, depreciation expense | $ 2.6 | $ 1.9 | $ 4.8 | $ 3.7 |
Operating Segments | Mining Segment | ||||
Segment Reporting Information [Line Items] | ||||
Cost of revenue, depreciation expense | $ 46.5 | $ 0.9 | $ 85.9 | $ 1.6 |
SEGMENT REPORTING - Schedule _2
SEGMENT REPORTING - Schedule of Customer Concentration Risk (Details) - Customer Concentration Risk | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
A | Revenue | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 40% | 23% |
A | Revenue from Contract with Customer, Segment Benchmark | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 46% | 27% |
B | Revenue | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 22% | |
B | Revenue from Contract with Customer, Segment Benchmark | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 27% | |
Blockcap | Revenue | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 18% | 19% |
Blockcap | Revenue from Contract with Customer, Segment Benchmark | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 21% | 23% |
SEGMENT REPORTING - Reconciliat
SEGMENT REPORTING - Reconciliation of Reportable Segment Gross Profit to Loss Before Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Segment Reporting [Abstract] | ||||
Gross profit | $ 12,717 | $ 24,538 | $ 82,720 | $ 39,071 |
Gain (loss) from sales of digital assets | 11,808 | (16) | 13,971 | 14 |
Impairment of digital assets | (150,213) | 0 | (204,198) | 0 |
Impairment of goodwill and other intangibles | (790,753) | 0 | (790,753) | 0 |
Losses on exchange or disposal of property, plant and equipment | (13,057) | (17) | (13,057) | (17) |
Operating expenses: | ||||
Research and development | 14,773 | 1,437 | 18,113 | 2,645 |
Sales and marketing | 10,238 | 720 | 11,636 | 1,254 |
General and administrative | 90,874 | 6,822 | 131,034 | 10,617 |
Total operating expenses | 115,885 | 8,979 | 160,783 | 14,516 |
Operating (loss) income | (1,045,383) | 15,526 | (1,072,100) | 24,552 |
Non-operating (income) expenses, net: | ||||
Loss on debt extinguishment | 0 | 7,974 | 0 | 8,016 |
Interest expense, net | 27,116 | 10,846 | 48,792 | 12,981 |
Fair value adjustment on convertible notes | (195,061) | 0 | 190,976 | 0 |
Fair value adjustment on derivative warrant liabilities | (22,189) | 0 | (32,464) | 0 |
Other non-operating expenses, net | 3,876 | 2 | 3,519 | 2 |
Total non-operating (income) expenses, net | (186,258) | 18,822 | 210,823 | 20,999 |
(Loss) income before income taxes | (859,125) | (3,296) | (1,282,923) | 3,553 |
Income tax (benefit) expense | (48,650) | 118 | (6,244) | 118 |
Net (loss) income | $ (810,475) | $ (3,414) | $ (1,276,679) | $ 3,435 |
RELATED-PARTY TRANSACTIONS (Det
RELATED-PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||||
Accounts receivable from related parties | $ 677 | $ 677 | $ 300 | ||
Affiliated Entity | Directors and Executives | |||||
Related Party Transaction [Line Items] | |||||
Accounts receivable from related parties | 700 | 700 | 300 | ||
Affiliated Entity | Directors and Executives | Hosting Service | |||||
Related Party Transaction [Line Items] | |||||
Revenue from related parties | 7,600 | $ 6,700 | 13,500 | $ 11,000 | |
Affiliated Entity | Directors and Executives | Equipment Sales | |||||
Related Party Transaction [Line Items] | |||||
Revenue from related parties | 11,700 | 9,500 | 37,600 | 17,400 | |
Affiliated Entity | Chief Executive Officer | |||||
Related Party Transaction [Line Items] | |||||
Related party transactions, reimbursement | 800 | $ 200 | 1,200 | $ 200 | |
Payable to related party | $ 200 | $ 200 | $ 0 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ / shares in Units, $ in Thousands, shares in Millions | 1 Months Ended | ||||||
Aug. 01, 2022 shares | Jul. 31, 2022 USD ($) $ / shares shares | Jun. 30, 2023 USD ($) | Aug. 19, 2022 USD ($) Day | Jun. 30, 2022 USD ($) $ / shares | Jan. 19, 2022 $ / shares | Dec. 31, 2021 USD ($) $ / shares | |
Subsequent Event [Line Items] | |||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.00001 | $ 0.0001 | ||||
Threshold consecutive trading days | 5 days | ||||||
Accounts receivable, net | $ 2,840 | $ 1,382 | |||||
Celsius Mining LLC | |||||||
Subsequent Event [Line Items] | |||||||
Accounts receivable, net | $ 900 | ||||||
Subsequent Event | Amended B. Riley Bridge Notes | Bridge Loan | |||||||
Subsequent Event [Line Items] | |||||||
Number of debt instruments | Day | 2 | ||||||
Interest rate per annum | 7% | ||||||
Debt instrument, additional payments required, threshold secured debt face amount | $ 500,000 | ||||||
Bridge loan, additional payments required, percentage of amounts drawn under equity line of credit | 25% | ||||||
Subsequent Event | Amended B. Riley Bridge Notes | Bridge Loan | B. Riley Commercial Capital, LLC | |||||||
Subsequent Event [Line Items] | |||||||
Note payable face amount | $ 60,000 | ||||||
Subsequent Event | Amended B. Riley Bridge Notes | Bridge Loan | Affiliate Of B. Riley Commercial Capital, LLC | |||||||
Subsequent Event [Line Items] | |||||||
Note payable face amount | $ 15,000 | ||||||
Subsequent Event | Forecast | Amended B. Riley Bridge Notes | Bridge Loan | |||||||
Subsequent Event [Line Items] | |||||||
Bridge loan, amount due in the first half of 2023 | $ 37,500 | ||||||
Subsequent Event | B. Riley | Common Stock Purchase Agreement | |||||||
Subsequent Event [Line Items] | |||||||
Sale of stock, authorized amount | $ 100,000 | ||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | ||||||
Purchase share volume maximum calculation, denominator | 0.2 | ||||||
Percent of closing sale price of the common stock | 75% | ||||||
Discount rate | 3% | ||||||
Stock purchase agreement, authorized number of shares (in shares) | shares | 70.3 | ||||||
Percent of common stock outstanding | 19.99% | ||||||
Threshold purchase price (in dollars per share) | $ / shares | $ 1.75 | ||||||
Threshold ownership percentage of outstanding common stock | 4.99% | ||||||
Common stock purchase agreement, threshold automatic termination period | 24 months | ||||||
Common stock purchase agreement, threshold aggregate gross purchase price | $ 100,000 | ||||||
Common stock purchase agreement, threshold trading days | 30 days | ||||||
Common stock purchase agreement, termination terms, prior written notice term | 5 days | ||||||
Reimbursement of legal fees | $ 100 | ||||||
Subsequent Event | B. Riley | Common Stock Purchase Agreement | Common Stock, Commitment Shares | |||||||
Subsequent Event [Line Items] | |||||||
Issuances of Series A contingently redeemable convertible preferred stock (in shares) | shares | 0.6 | ||||||
Subsequent Event | B. Riley Securities, Inc. | |||||||
Subsequent Event [Line Items] | |||||||
Issuance of common stock (in shares) | shares | 0.4 | ||||||
Subsequent Event | Celsius Mining LLC | |||||||
Subsequent Event [Line Items] | |||||||
Accounts receivable, net | $ 800 |