Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 01, 2019 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | IDEANOMICS, INC. | |
Entity Central Index Key | 0000837852 | |
Trading Symbol | idex | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 108,561,959 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 2,011,898 | $ 3,106,244 |
Accounts receivable, net | 19,406,354 | 19,370,665 |
Licensed content, current | 16,958,149 | |
Prepayments | 2,581,746 | 2,042,041 |
Other current assets | 3,799,358 | 3,594,942 |
Total current assets | 27,799,356 | 45,072,041 |
Property and equipment, net | 15,593,255 | 15,029,427 |
Intangible assets, net | 68,394,632 | 3,036,352 |
Goodwill | 704,884 | 704,884 |
Long-term investments | 22,943,594 | 26,408,609 |
Operating lease right of use assets | 6,802,721 | |
Other non-current assets | 3,983,796 | 3,983,799 |
Total assets | 146,222,238 | 94,235,112 |
Current liabilities: (including amounts of the consolidated VIEs without recourse to Ideanomics, Inc. See Note 4) | ||
Accounts payable | 19,219,153 | 19,265,094 |
Deferred revenue | 14,709,050 | 405,929 |
Amount due to related parties | 1,028,253 | 800,822 |
Other current liabilities | 5,510,856 | 5,321,697 |
Convertible promissory note due to related parties | 4,312,561 | 4,140,055 |
Total current liabilities | 44,779,873 | 29,933,597 |
Deferred tax liabilities | 427,531 | 513,935 |
Asset retirement obligations | 8,000,000 | 8,000,000 |
Convertible note-long term | 12,011,784 | 11,313,770 |
Operating lease liability | 7,044,164 | |
Total liabilities | 72,263,352 | 49,761,302 |
Commitments and contingencies (Note 17) | ||
Convertible redeemable preferred stock: | ||
Series A - 7,000,000 shares issued and outstanding, liquidation and deemed liquidation preference of $3,500,000 as of March 31, 2019 and December 31, 2018 | 1,261,995 | 1,261,995 |
Equity: | ||
Common stock - $0.001 par value; 1,500,000,000 shares authorized, 108,561,959 shares and 102,766,006 shares issued and outstanding as of March 31, 2019 and December 31, 2018, respectively | 108,561 | 102,765 |
Additional paid-in capital | 205,203,264 | 195,779,576 |
Accumulated deficit | (130,048,787) | (149,975,302) |
Accumulated other comprehensive loss | (1,492,465) | (1,664,598) |
Total IDEX shareholder's equity | 73,770,573 | 44,242,441 |
Non-controlling interest | (1,073,682) | (1,030,626) |
Total equity | 72,696,891 | 43,211,815 |
Total liabilities, convertible redeemable preferred stock and equity | $ 146,222,238 | $ 94,235,112 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Convertible redeemable preferred stock, Series A shares issued | 7,000,000 | 7,000,000 |
Convertible redeemable preferred stock, Series A shares outstanding | 7,000,000 | 7,000,000 |
Convertible redeemable preferred stock, Series A liquidation and deemed liquidation preference | $ 3,500,000 | $ 3,500,000 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,500,000,000 | 1,500,000,000 |
Common stock, shares issued | 108,561,959 | 102,766,006 |
Common stock, shares outstanding | 108,561,959 | 102,766,006 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Income Statement [Abstract] | ||
Revenue from third parties | $ 345,564 | $ 185,933,821 |
Revenue from related party | 26,600,000 | |
Total revenue | 26,945,564 | 185,933,821 |
Cost of revenue from third parties | 257,406 | 23,280,931 |
Cost of revenue from related parties | 162,259,754 | |
Gross profit | 26,688,158 | 393,136 |
Operating expenses: | ||
Selling, general and administrative expenses | 4,187,868 | 3,737,999 |
Research and development expense | 46,022 | |
Professional fees | 1,360,214 | 712,933 |
Depreciation and amortization | 244,178 | 10,205 |
Total operating expenses | 5,792,260 | 4,507,159 |
Income (Loss) from operations | 20,895,898 | (4,114,023) |
Interest and other income (expense): | ||
Interest expense, net | (735,205) | (28,035) |
Equity in loss of equity method investees | (280,486) | (19,743) |
Others | (57,858) | 348,988 |
Income (Loss) before income taxes and non-controlling interest | 19,822,349 | (3,812,813) |
Income tax benefit | 86,405 | |
Net income (loss) | 19,908,754 | (3,812,813) |
Net loss attributable to non-controlling interest | 17,761 | 91,444 |
Net income (loss) attributable to IDEX common shareholders | $ 19,926,515 | $ (3,721,369) |
Earnings (loss) per share | ||
Basic (in dollars per shares) | $ 0.19 | $ (0.05) |
Diluted (in dollars per shares) | $ 0.18 | $ (0.05) |
Weighted average shares outstanding: | ||
Basic (in shares) | 105,345,673 | 68,816,303 |
Diluted (in shares) | 116,301,236 | 68,816,303 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 19,908,754 | $ (3,812,813) |
Other comprehensive income (loss), net of nil tax | ||
Foreign currency translation adjustments | 146,838 | (41,629) |
Comprehensive income (loss) | 20,055,592 | (3,854,442) |
Comprehensive loss attributable to non-controlling interest | 43,056 | 100,592 |
Comprehensive income (loss) attributable to IDEX common shareholders | $ 20,098,648 | $ (3,753,850) |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY (Unaudited) - USD ($) | Common Stock | Common Stock in Escrow Account | Additional Paid-in Capital | Retained Earnings / Accumulated Deficit | Accumulated Other Comprehensive Loss | Ideanomics Shareholders' equity | Non - controlling Interest | Total |
Balance at Dec. 31, 2017 | $ 68,509 | $ 158,449,544 | $ (126,693,022) | $ (782,074) | $ 31,042,957 | $ (1,289,367) | $ 29,753,590 | |
Balance (in shares) at Dec. 31, 2017 | 68,509,090 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Share-based compensation | 121,190 | 121,190 | 121,190 | |||||
Common stock issuance for RSU vested and restricted shares | $ 13 | (13) | ||||||
Common stock issuance for RSU vested and restricted shares (in shares) | 13,464 | |||||||
Common stock issued for warrant exercised | $ 300 | 524,700 | 525,000 | 525,000 | ||||
Common stock issued for warrant exercised (in shares) | 300,000 | |||||||
Common stock issuance for option exercised | $ 43 | 2,589 | 2,632 | 2,632 | ||||
Common stock issuance for option exercised (in shares) | 42,501 | |||||||
Acquisition of Guangmin | (36,646) | (36,646) | (36,646) | |||||
Net income (loss) | (3,721,369) | (3,721,369) | (91,444) | (3,812,813) | ||||
Foreign currency translation adjustments, net of nil tax | (32,481) | (32,481) | (9,148) | (41,629) | ||||
Balance at Mar. 31, 2018 | $ 68,865 | 159,061,364 | (130,414,391) | (814,555) | 27,901,283 | (1,389,959) | 26,511,324 | |
Balance (in shares) at Mar. 31, 2018 | 68,865,055 | |||||||
Balance at Dec. 31, 2018 | $ 102,765 | 195,779,576 | (149,975,302) | (1,664,598) | 44,242,441 | (1,030,626) | 43,211,815 | |
Balance (in shares) at Dec. 31, 2018 | 102,766,006 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Share-based compensation | 224,484 | 224,484 | 224,484 | |||||
Common stock issuance for RSU vested and restricted shares | $ 130 | (130) | ||||||
Common stock issuance for RSU vested and restricted shares (in shares) | 129,840 | |||||||
Common stock issuance for acquisition (SolidOpinion, Inc) | $ 4,500 | 7,150,500 | 7,155,000 | 7,155,000 | ||||
Common stock issuance for acquisition (SolidOpinion, Inc) (in shares) | 4,500,000 | |||||||
Common stock issuance for convertible debt | $ 1,166 | 2,048,834 | 2,050,000 | 2,050,000 | ||||
Common stock issuance for convertible debt (in shares) | 1,166,113 | |||||||
Net income (loss) | 19,926,515 | 19,926,515 | (17,761) | 19,908,754 | ||||
Foreign currency translation adjustments, net of nil tax | 172,133 | 172,133 | (25,295) | 146,838 | ||||
Balance at Mar. 31, 2019 | $ 108,561 | $ 25,500 | $ 205,203,264 | $ (130,048,787) | $ (1,492,465) | $ 73,770,573 | $ (1,073,682) | $ 72,696,891 |
Balance (in shares) at Mar. 31, 2019 | 108,561,959 | 25,500,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 19,908,754 | $ (3,812,813) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Share-based compensation expense | 224,484 | 121,190 |
Depreciation and amortization | 244,178 | 10,205 |
Non-cash interest expense | 735,205 | |
Equity in losses of equity method investees | 280,486 | 19,743 |
Digital tokens received as payment for services | (26,600,000) | |
Change in assets and liabilities: | ||
Accounts receivable | (35,689) | (80,546,513) |
Prepaid expenses and other assets | (124,121) | 190,865 |
Accounts payable | (45,941) | (5,618,606) |
Deferred revenue | 203,121 | (68,850) |
Amount due to related parties | 40,206 | 86,265,554 |
Accrued expenses, salary and other current liabilities | 398,550 | 34,907 |
Net cash used in operating activities | (4,770,767) | (3,404,318) |
Cash flows from investing activities: | ||
Acquisition of property and equipment | (580,437) | (7,682) |
Disposal of subsidiaries, net of cash disposed | (36,646) | |
Acquisition of subsidiaries, net of cash acquired | (391,610) | |
Payments for long term investments | (620,000) | |
Net cash used in investing activities | (1,200,437) | (435,938) |
Cash flows from financing activities | ||
Proceeds from issuance of convertible notes | 2,132,300 | |
Proceeds from issuance of common stocks | 2,500,000 | 527,632 |
Proceeds from/(Repayment of) amounts due to related parties | 227,431 | |
Repayment of amounts due to related parties | (42,420) | |
Net cash provided by financing activities | 4,859,731 | 485,212 |
Effect of exchange rate changes on cash | 17,127 | 21,687 |
Net increase (decrease) in cash and restricted cash | (1,094,346) | (3,333,357) |
Cash and restricted cash at the beginning of the period | 3,106,244 | 7,577,317 |
Cash and restricted cash at the end of the period | 2,011,898 | 4,243,960 |
Supplemental disclosure of cash flow information: | ||
Cash paid for income tax | 0 | 0 |
Cash paid for interest | 0 | $ 0 |
Disposal assets in exchange of GTB tokens | 20,218,920 | |
Service Revenue received in GTB tokens | 26,600,000 | |
Advances from Customer received in GTB tokens | 14,100,000 | |
Issuance of shares for acquisition of intangible assets | $ 4,655,000 |
Nature of Operations and Summar
Nature of Operations and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Nature Of Operations And Summary Of Significant Accounting Policies [Abstract] | |
Nature of Operations and Summary of Significant Accounting Policies | Note 1. Nature of Operations and Summary of Significant Accounting Policies Nature of Operations Ideanomics, Inc. (Nasdaq: IDEX) is a Nevada corporation that primarily operates in the United States and Asia. The Company comprised of (i) our Legacy YOD business with primary operations in the PRC, and (ii) our Wecast Service business, a global financial technology (“Fintech”) advisory and Platform-as-a-Service company with the intent of offering customized services based on best-in-class blockchain, AI and other technologies to mature and emerging businesses across various industries. To do so, we are building a technology ecosystem through license agreements, joint ventures and strategic acquisitions, which we refer to as our “Fintech Ecosystem”. In parallel, through strategic acquisitions, equity investments and joint ventures, we are building a network of businesses, operating across industry verticals which we refer to as our “Industry Ventures”. We believe these industry verticals have significant potential to recognize benefits from blockchain and AI technologies that may, for example, enhance operations, address cost inefficiencies, improve documentation and standardization, unlock asset value and improve customer engagement. Our core business strategy is to promote the use, development and advancement of blockchain- and AI-based technologies, and our positioning in the fintech industry overall, by bringing technology leaders together with industry leaders and creating synergies between the businesses in our expanding Fintech Ecosystem and the businesses in our Industry Ventures. Various aspects of the development of our Fintech Ecosystem and our Industry Ventures are still in the planning and testing phase and are generally not operational or revenue generating. Basis of Presentation In this Form 10-Q, unless the context otherwise requires, the use of the terms "we," "us", "our" and the “Company” refers to Ideanomics, Inc, its consolidated subsidiaries and variable interest entities (“VIEs”). On April 24, 2018, the Company completed the acquisition of 100% equity ownership in Shanghai Guang Ming Investment Management (“Guang Ming”), a PRC limited liability company. One of the two selling shareholders is a related party, an affiliate of Dr. Wu. Guang Ming holds a special fund management license. The acquisition will help the Company develop a fund management platform. Under Accounting Standard Codification (“ASC”) 805-50-05-5 and ASC 805-50-30-5, the transaction was accounted for as a reorganization of entities under common control, in a manner similar to a pooling of interest, using historical costs. As a result of the reorganization, the net assets of Guang Ming were transferred to the Company, and the accompanying consolidated financial statements as of and for the three months ended March 31, 2018 have been prepared as if the current corporate structure had been in place at the beginning of periods presented in which the common control existed. In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair statements of the financial position as of March 31, 2019, results of operations for the three months ended March 31, 2019 and 2018, and cash flows for the three months ended March 31, 2019 and 2018, have been made. All significant intercompany transactions and balances are eliminated on consolidation. However, the results of operations included in such financial statements may not necessary be indicative of annual results. We use the same accounting policies in preparing quarterly and annual financial statements. Certain information and footnote disclosures normally included in the annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. These unaudited consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission on April 1, 2019 (“2018 Annual Report”). Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the related disclosure of contingent assets and liabilities. Actual results could differ from those estimates. On an ongoing basis, we evaluate our estimates, including those related to the bad debt allowance, variable considerations, fair values of financial instruments, intangible assets (including digital tokens) and goodwill, useful lives of intangible assets and property and equipment, asset retirement obligations, income taxes, and contingent liabilities, among others. We base our estimates on assumptions, both historical and forward looking, that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Fair Value Measurements Accounting standards require the categorization of financial assets and liabilities, based on the inputs to the valuation technique, into a three-level fair value hierarchy. The various levels of the fair value hierarchy are described as follows: • Level 1 - Financial assets and liabilities whose values are based on unadjusted quoted market prices for identical assets and liabilities in an active market that we have the ability to access. • Level 2 - Financial assets and liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable for substantially the full term of the asset or liability. • Level 3 - Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company reviews the valuation techniques used to determine if the fair value measurements are still appropriate on an annual basis, and evaluate and adjust the unobservable inputs used in the fair value measurements based on current market conditions and third party information. Our financial assets and liabilities that are measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, other current liabilities and convertible notes. The fair values of these assets approximate carrying values because of the short-term nature of these instruments. If these instruments were measured at fair value in the financial statements, they would be classified as Level 1 in the fair value hierarchy. Our financial assets that are measured at fair value on a nonrecurring basis include goodwill and other intangible assets, asset retirement obligations, and adjustment in carrying value of equity securities for which the measurement alternative of cost less impairment plus or minus observable price changes is used. There were no material impairments and no material adjustments to equity securities using the measurement alternative for the three months ended March 31, 2019 and 2018. Digital Tokens Digital tokens consist of GTB tokens received in connection with the services agreement and assets purchase agreement with GT Dollar Pte. Ltd. (“GTD”), our minority shareholder (Note 3 and 13 (b)). Given that there is limited precedent regarding the classification and measurement of cryptocurrencies and other digital tokens under current GAAP, the Company has determined to account for these tokens as indefinite-lived intangible assets in accordance with ASC 350, Intangibles—Goodwill and Other until further guidance is issued by the FASB. Indefinite-lived intangible assets are recorded at cost and are not subject to amortization, but shall be tested for impairment annually and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. If, at the time of an impairment test, the carrying amount of an intangible asset exceeds its fair value, an impairment loss in an amount equal to the excess is recognized. The fair value of GTB tokens was a Level 2 measurement (see Note 3) based upon the consideration agreed by GTD and the Company with a discount considering volatility, risk and limitations at contract inception. Reclassifications of a General Nature Certain amounts in the prior periods presented have been reclassified to conform to the current period financial statement presentation. These reclassifications have no effect on previously reported net income. Note 2 provides information about our adoption of new accounting standards for leases. |
New Accounting Pronouncements
New Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2019 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements | Note 2. New Accounting Pronouncements Recently Adopted Accounting Pronouncements We adopted Financial Accounting Standards Board (FASB) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842), as of January 1, 2019, using a modified retrospective transition method and as a result, the consolidated balance sheet prior to January 1, 2019 was not restated, continues to be reported under ASC Topic 840, Leases, or ASC 840. For all leases at the lease commencement date, a right-of-use asset and a lease liability are recognized. The right-of-use asset represents the right to use the leased asset for the lease term. The lease liability represents the present value of the lease payments under the lease. The lease liability is based on the present value of the remaining minimum lease payments, determined under ASC 840, discounted using our incremental borrowing rate at the effective date of January 1, 2019, using the original lease term as the tenor. As permitted under the transition guidance, we elected several practical expedients that permit us to not reassess (1) whether a contract is or contains a lease, (2) the classification of existing leases, and (3) whether previously capitalized costs continue to qualify as initial indirect costs. The application of the practical expedients did not have a significant impact on the measurement of the operating lease liability. Adoption of the new standard resulted in the recording of operating right of use assets and the related lease liabilities of approximately $3.6 million and $3.7 million, respectively, as of January 1, 2019. The difference between the additional lease assets and lease liabilities was immaterial. The standard did not materially impact our consolidated operating results and had no impact on cash flows. Please see Note 9. In June 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which largely aligns the measurement and classification guidance for share-based payments to nonemployees with the guidance for share-based payments to employees. The ASU also clarifies that any share-based payment issued to a customer should be evaluated under ASC 606, Revenue from Contracts with Customers In July 2017, the FASB issued ASU No. 2017-11, (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. The new standard applies to issuers of financial instruments with down-round features. A down-round provision is a term in an equity-linked financial instrument (i.e. a freestanding warrant contract or an equity conversion feature embedded within a host debt or equity contract) that triggers a downward adjustment to the instrument’s strike price (or conversion price) if equity shares are issued at a lower price (or equity-linked financial instruments are issued at a lower strike price) than the instrument’s then-current strike price. The purpose of the feature is typically to protect the instrument’s counterparty from future issuances of equity shares at a more favorable price. The ASU amends (1) the classification of such instruments as liabilities or equity by revising the certain guidance relative to evaluating if they must be accounted for as derivative instruments and (2) the guidance on recognition and measurement of freestanding equity-classified instruments. For the Company, this ASU was effective January 1, 2019. Please see Note 11. Standards Issued and Not Yet Adopted In June 2016, the FASB issued Accounting Standards Update No. 2016-13 (ASU 2016-13) "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. We will adopt ASU 2016-13 effective January 1, 2020. We are currently evaluating the effect of the adoption of ASU 2016-13 on our consolidated financial statements. The effect will largely depend on the composition and credit quality of our investment portfolio and the economic conditions at the time of adoption. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Note 3. Revenue The Company recognizes revenue when its customer obtains control of promised goods or services in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. The majority of the Company’s revenue is derived from Wecast Service. The following table presents our revenues disaggregated by revenue source, geography (based on our business locations) and timing of revenue recognition. Three Months Ended March 31, 2019 March 31, 2018 Geographic Markets Singapore $ - $ 178,178,605 USA 26,945,564 - Hong Kong - 7,755,216 $ 26,945,564 $ 185,933,821 Services Lines -Wecast Service Crude oil $ - $ 178,178,605 Consumer electronics - 7,613,113 Digital asset management services 26,600,000 - Digital advertising services and other 345,564 142,103 26,945,564 185,933,821 -Legacy YOD - - Total $ 26,945,564 $ 185, 933,821 Timing of Revenue Recognition Products transferred at a point in time $ 345,564 $ 185, 933,821 Services provided over time 26,600,000 - Total $ 26,945,564 $ 185, 933,821 Wecast service revenue Wecast Services is mainly engaged in the logistics management, including sales of crude oil, consumer electronics, and digital consulting services such as assets management and marketing services. Logistics management revenue: Revenue from the sales of crude oil and consumer electronics is recognized when the customer obtains control of the Company’s crude oil and consumer electronics, which occurs at a point in time, usually upon shipment or upon acceptance. The contracts are generally short-term contracts where the time between order confirmation and satisfaction of all performance obligations is less than one year. The most significant judgment is determining whether we are the principal or agent for the sales of crude oil and consumer electronics. We report revenues from these transactions on a gross basis where we are the principal considering the following principal versus agent indicators: (a) We are primarily responsible for fulfilling the promise to provide the goods to the customer. The Company enters into contracts with customers with specific quality requirements and the suppliers separately. The Company is obliged to provide the goods if the supplier fails to transfer the goods to the customer and responsible for the acceptability of the goods. (b) The Company has certain inventory risk. Although the Company has the title to the good only momentarily before passing title on to the customer, the Company is responsible to arrange and issue bill of lading to the customer so that the customer can have the right to obtain the required oil product. In addition, the customer can seek remedies and submit the clam against the Company regarding the quality or quantity of the products delivered. (c) The Company has discretion in establishing prices. Upon delivery of the crude oil and consumer electronics to the customer, the terms of the contract between the Company and the supplier require the Company to pay the supplier the agreed-upon price. The Company and the customer negotiate the selling price, and the Company invoices the customer for the agreed-upon selling price. The Company’s profit is based on the difference between the sales price negotiated with the customer and the price charged by the supplier. The sales price for crude oil is based on the daily benchmark price of spot product plus any premium determined by the Company. Digital asset management service with GTD: On March 14, 2019, the Company entered into a service agreement with one of our minority shareholders, GTD to provide digital asset management services including consulting, advisory and management services which will be delivered in two phases. There are two performance obligations: (1) the development of a master plan for GTD’s assets for 7,083,333 GTB tokens agreed by both parties; and (2) exclusive marketing and business development management services for a fee as percentage (0.25%) of the total market value of GTB tokens; based on a 10-day average of the 10 business days leading up to the end of a respective calendar month, and paid on the first day of each new calendar month. The Company recognizes revenue for the master plan development services over the contract period (expected to be completed in six months), based on the progress of the services provided towards completed satisfaction. Based on ASC 606-10-32, at contract inception, the Company considered the following factors to estimate the fair value of GTB token (noncash consideration): a) it only trades in one exchange, which operations have been less than one year; b) its historical volatility is high; c) the Company’s intention to hold the majority of GTB tokens, as part of our digital asset management services; and d) associated risks discussed in Note 18 (f). Therefore, the fair value of 7,083,333 GTB tokens using Level 2 measurement was approximately $40.7 million with a 76% discount to the fixed contract price agreed upon by both parties when signed the contract. We considered similar token exchanges in Singapore and considered the volatility of the quoted prices and determined a discount of 76%. We recognized $26.6 million for the three months ended March 31, 2019 and recognized deferred revenue in the amount of $14.1 million as of March 31, 2019. The Company considers the payments for marketing and business development management services as performance based consideration, in accordance with ASC 606 on constraining estimates of variable consideration, including the following factors: • The susceptibility of the consideration amount to factors outside the Company’s influence. • The uncertainty associated with the consideration amount is not expected to be resolved for a long period of time. • The Company ’ • Whether the Company expects to offer price concessions or change the payment terms. • The range of possible consideration amounts. For the three months ended March 31, 2019, the Company only provided the development service and recognized revenue of $26.6 million. Legacy YOD revenue Since 2017, we run our legacy YOD segment with limited resources. No revenue was recognized for the three months ended March 31, 2019 and 2018. Arrangements with multiple performance obligations Our contracts with customers may include multiple performance obligations. For such arrangements, we allocate revenue to each performance obligation based on its relative standalone selling price. We generally determine standalone selling prices based on the observable prices charged to customers or adjusted market assessment or using expected cost plus margin when one is available. Adjusted market assessment price is determined based on overall pricing objectives taking into consideration market conditions and entity specific factors. Variable consideration Certain customers may receive discounts, which are accounted for as variable consideration. We estimate these amounts based on the expected amount to be provided to customers and reduce revenues recognized. Our revenue reserves, consisting of various discounts and allowances, which are components of variable consideration as discussed above, are considered an area of significant judgment. Additionally, our digital asset management service revenue, as discussed above, is calculated as a percentage (0.25%) of the total market value of GTB tokens. For these areas of significant judgment, actual amounts may ultimately differ from our estimates and are adjusted in the period in which they become known. Deferred revenues We record deferred revenues when cash payments are received or due in advance of our performance, including amounts which are refundable. The increase in the deferred revenue balance for the three months ended March 31, 2019 is primarily driven by cash payments and GTB tokens received or due in advance of satisfying our performance obligations. Our payment terms vary by the type and location of our customer and the products or services offered. The term between invoicing and when payment is due is not significant. For certain products or services and customer types, we require payment before the products or services are delivered to the customer. Practical expedients and exemptions We do not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. |
VIE Structure and Arrangements
VIE Structure and Arrangements | 3 Months Ended |
Mar. 31, 2019 | |
Vie Structure And Arrangements [Abstract] | |
VIE Structure and Arrangements | Note 4. VIE Structure and Arrangements We consolidate VIEs in which we hold a variable interest and are the primary beneficiary through contractual agreements. We are the primary beneficiary because we have the power to direct activities that most significantly affect their economic performance and have the obligation to absorb the majority of their losses or benefits. The results of operations and financial position of these VIEs are included in our consolidated financial statements. For these consolidated VIEs, their assets are not available to us and their creditors do not have recourse to us. As of March 31, 2019 and December 31, 2018, assets (mainly long-term investments) that can only be used to settle obligations of these VIEs were approximately $3.6 million and $3.5 million, respectively, and the Company is the major creditor for the VIEs. In order to operate our Legacy YOD business in PRC and to comply with PRC laws and regulations that prohibit or restrict foreign ownership of companies that provides value-added telecommunication services, the Company entered into a series of contractual agreements with two VIEs: Beijing Sinotop Scope Technology Co., Ltd (“Sinotop Beijing”) and Tianjin Sevenstarflix Network Technology Limited (“SSF”). These contractual agreements will be expired in March 2030 and April 2036, respectively and may not be terminated by the VIEs, except with the consent of, or a material breach by us. Currently, the Company is still evaluating the overall operating strategy for YOD legacy business and does not have plan to provide any funding to these two VIEs. Please refer to Note 18(a) for associated regulatory risks. Based on the contracts we entered with VIEs’ shareholders, we consider that there is no asset of the VIEs that can be used only to settle obligation of the Company, except for the registered capital of VIEs amounting to RMB 38.2 million (approximately $5.7 million). |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Acquisitions | Note 5. Acquisitions (a) Assets Acquisition of SolidOpinion, Inc (“SolidOpinion”) On February 19, 2019, the Company completed the acquisition of certain assets from SolidOpinion in exchange for 4,500,000 shares of the Company’s common stock. The assets include cash ($2.5 million) and an intellectual property (“IP”) which is complementary to the IP of Grapevine. The parties agreed that 450,000 of such shares of common stock (“Escrow Shares”) will be held in escrow until February 19, 2020 in connection with SolidOpinion’s indemnity obligations pursuant to the agreement. SolidOpinion have the rights to vote and receive the dividends paid with respect to the Escrow Shares. (b) Acquisition of Tree Motion Sdn. Bhd. (“Tree Motion”) On March 5, 2019, the Company entered into the following acquisition agreements: · Acquire 51% of Tree Motion, a Malaysian company, for 25,500,000 shares of the Company’s common stock at $2.00 per share. · Acquire 11.22% of Tree Motion’s parent company, Tree Manufacturing Sdn. Bhd., for 12,190,000 shares of the Company’s common stock and $620,000 in cash or/and loan. Therefore, we will directly and indirectly own 55.50% of Tree Motion. The transactions are conditioned upon the Company’s completion of its due diligence, customary closing conditions and regulatory approval. We paid $620,000 in March 2019 as an investment deposit and recorded in prepayments on our consolidated balance sheet as of March 31, 2019. |
Property and Equipment, net
Property and Equipment, net | 3 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | Note 6. Property and Equipment, net The following is a breakdown of property and equipment: March 31, December 31, 2019 2018 Furniture and office equipment $ 345,541 $ 357,064 Vehicle 64,632 63,135 Leasehold improvements 198,584 200,435 Total property and equipment 608,757 620,634 Less: accumulated depreciation (196,566 ) (186,514 ) Construction in progress (Fintech Village) 15,181,064 14,595,307 Property and Equipment, net $ 15,593,255 $ 15,029,427 The Company recorded depreciation expense of approximately $16,609 and $7,584, which is included in its operating expense for the three months ended March 31, 2019 and 2018, respectively. The Company capitalized direct costs and interest cost incurred on funds used to construct Fintech Village and the capitalized cost is recorded as part of construction in progress. Capitalized cost was approximately $586,000 for the three months ended March 31, 2019 mainly related to the legal and architect costs. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Note 7. Goodwill and Intangible Assets Goodwill There were no acquisitions that closed during the first three months of 2019 and there is no change in the carrying amount of goodwill. Intangible Assets Information regarding amortizing and indefinite lived intangible assets consisted of the following: March 31, 2019 December 31, 2018 Weight Gross Accumulated Impairment Net Gross Accumulated Impairment Net Useful Life Amount Amortization Loss Balance Amount Amortization Loss Balance Amortizing Intangible Assets Animation Copyright (Note 13 (b)) - $ - $ - $ - $ - $ 301,495 $ (64,606 ) $ - $ 236,889 Software and licenses - 97,308 (95,648 ) - 1,660 97,308 (93,251 ) - 4,057 Intellectual property (Note 5 (a)) 4.9 4,655,000 (77,583 ) - 4,577,417 - - - - Influencer network 9.5 1,980,000 (115,500 ) - 1,864,500 1,980,000 (66,000 ) - 1,914,000 Customer contract 2.5 500,000 (97,223 ) - 402,777 500,000 (55,556 ) - 444,444 Trade name 14.5 110,000 (4,277 ) - 105,723 110,000 (2,444 ) - 107,556 Technology platform 6.5 290,000 (24,165 ) - 265,835 290,000 (13,808 ) - 276,192 Total amortizing intangible assets $ 7,632,308 $ (414,396 ) $ - $ 7,217,912 $ 3,278,803 $ (295,665 ) $ - $ 2,983,138 Indefinite lived intangible assets Website name 25,214 - - 25,214 159,504 - (134,290 ) 25,214 Patent 28,000 - - 28,000 28,000 - - 28,000 GTB Tokens (Note 13 (b)) 61,123,506 - - 61,123,506 - - - - Total intangible assets $ 68,809,028 $ (414,396 ) $ - $ 68,394,632 $ 3,466,307 $ (295,665 ) $ (134,290 ) $ 3,036,352 Amortization expense relating to intangible assets was $227,568 and $2,621 for the three months ended March 31, 2019 and 2018, respectively. The following table outlines the expected amortization expense for the following years: Amortization to be Years ending December 31, recognized 2019 (excluding the three months ended March 31, 2019) $ 1,198,499 2020 1,344,429 2021 1,288,873 2022 1,177,762 2023 and thereafter 2,208,350 Total amortization to be recognized $ 7,217,913 |
Long-term Investments
Long-term Investments | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Long-term Investments | Note 8. Long-term Investments Long-term investments March 31, December 31, 2019 2018 Non-marketable Equity Investment $ 6,266,880 $ 9,452,103 Equity Method Investment 16,676,714 16,956,506 Total $ 22,943,594 $ 26,408,609 Non-marketable equity investment Our non-marketable equity investments are investments in privately held companies without readily determinable fair values are carried at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The Company reviews its equity securities without readily determinable fair values on a regular basis to determine if the investment is impaired. For purposes of this assessment, the Company considers the investee’s cash position, earnings and revenue outlook, liquidity and management ownership, among other factors, in its review. If management’s assessment indicates that an impairment exists, the Company estimates the fair value of the equity investment and recognizes in current earnings an impairment loss that is equal to the difference between the fair value of the equity investment and its carrying amount. There is no impairment for the three months ended March 31, 2019. Equity method investments The Company’s investment in companies accounted for using the equity method of accounting consist of the following: March 31, 2019 Foreign currency December 31, Loss on Impairment translation 2018 Addition investment loss adjustments March 31, 2019 Wecast Internet (i) $ 4,114 $ - $ (5 ) $ - $ 1,930 $ 6,039 Hua Cheng (ii) 308,666 - (14,598 ) - (1,236 ) 292,832 BDCG (iv) 9,800,000 - - - - 9,800,000 DBOT (v) 6,843,726 - (265,883 ) - - 6,577,843 Total $ 16,956,506 $ - $ (280,486 ) $ - $ 694 $ 16,676,714 All the investments above are privately held companies; therefore, quoted market prices are not available. We have not received any dividends since initial investments. (i) Wecast Internet Starting from October 2016, we have 50% interest in Wecast Internet Limited (“Wecast Internet”) and initial investment was invested RMB 1,000,000 (approximately $149,750). Wecast Internet is in the process of liquidation and the remaining carrying value is immaterial. (ii) Hua Cheng Hu Dong (Beijing) Film and Television Communication Co., Ltd.(“Hua Cheng”) The Company held 39% equity ownership in Hua Cheng, a company established to provide integrated value-added service solutions for the delivery of VOD and enhanced content for cable providers. (iii) Shandong Lushi Media Co., Ltd (“Shandong Media”) The Company held 30% equity ownership in Shandong Media, a print based media business, for Legacy YOD business. The accumulated operating loss of Shandong Media reduced the Company’s investment in Shandong Media to zero. The Company has no obligation to fund future operating losses. (iv) BBD Digital Capital Group Ltd. (“BDCG”) In 2018, we signed a joint venture agreement with two unrelated parties, to establish BDCG located in the United States for providing block chain services for financial or energy industries by utilizing AI and big data technology in the United States. On April 24, 2018, the Company acquired 20% equity ownership in BDCG from one noncontrolling party with cash consideration of a total consideration of $9.8 million which consists of $2 million in cash and $7.8 million paid in the form of the Company’s capital stock (valued at $2.60 per share and equal to 3 million shares of the Company’s common stock), increasing the Company’s ownership to 60%. The remaining 40% of BDCG are held by Seasail ventures limited (“Seasail”). The accounting treatment of the joint venture is based on the equity method due to variable substantive participating rights (in accordance with ASC 810-10-25-11) granted to Seasail. The new entity is currently in the process of ramping up its operations. In April 2019, the company rebranded the name of the BDCG joint venture to Intelligenta. As part of the rebranding, Intelligenta’s strategy will now include credit services, corporation services, index services and products, and capital market services and products. (v) Delaware Board of Trade Holdings, Inc. (“DBOT”) As of March 31, 2019, the Company held 36.92% equity ownership in DBOT. DBOT is an approved and licensed FINRA- and SEC-regulated electronic trading platform with operations in Delaware. One of our subsidiaries is powered by DBOT’s platform, trading system and technology. In April, 2019, the Company entered into a securities purchase agreement to acquire additional shares in DBOT for 4,427,870 shares of the Company’s common stock at $2.11 per share, thereby becoming the majority and controlling shareholder in DBOT. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | Note 9. Leases We lease certain office space and equipment from third parties. Leases with an initial term of 12 months or less are not recorded on the balance sheet and we recognize lease expense for these leases on a straight-line basis over the lease term. For leases beginning in 2019 and later, at the inception of a contract we assess whether the contract is, or contains, a lease. Our assessment is based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use of the asset throughout the period, and (3) whether we have the right to direct the use of the asset. At inception of a lease, we allocate the consideration in the contract to each lease component based on its relative stand-alone price to determine the lease payments. Leases entered into prior to January 1, 2019, are accounted for under ASC 840 and were not reassessed. We account for lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) separately from the nonlease components (e.g.,common-area maintenance costs). Most leases include one or more options to renew, with renewal terms that can extend the lease term from one year or more. The exercise of lease renewal options is at our sole discretion. Our leases do not include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term. Certain of our lease agreements include rental payments adjusted periodically for inflation. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. All our leases are operating lease. We have elected not to recognize right-of-use assets and lease liabilities for short-term leases that have a term of 12 months or less. The effect of short-term leases and initial direct costs on our right-of-use asset and lease liability was not material. As of March 31, 2019, our operating lease right of use assets and operating lease liability are approximately $6.8 million and $7.0 million, respectively. The operating lease expenses including in Selling, general and administrative expense are approximately $428,000 and $216,000 for the three months ended March 31, 2019 and 2018, respectively. The weighted-average remaining lease term is 3.8 years and the average discount rate is 7.25%. Maturity of operating lease liability is as follows: Maturity of Lease Liability Operating Lease 2019 $ 1,320,442 2020 1,177,261 2021 1,202,496 2022 1,294,781 2023 1,343,668 After 2024 2,529,735 Total lease payments 8,868,383 Less: Interest (1,824,219 ) Total $ 7,044,164 |
Supplemental Financial Statemen
Supplemental Financial Statement Information | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure Text Block Supplement [Abstract] | |
Supplemental Financial Statement Information | Note 10. Supplemental Financial Statement Information Other Current Assets “Other current assets” were approximately $3.8 million and $3.6 million as of March 31, 2019 and December 31, 2018, respectively. Component of "Other current assets" that was more than 5 percent of total current assets: other receivable from third parties in our subsidiaries located in PRC in the amount of $3.5 million and $3.3 million respectively. Other Current Liabilities “Other current liabilities” were approximately $5.5 million and $5.3 million as of March 31, 2019 and December 31, 2018, respectively. Components of "Other current liabilities" that were more than 5 percent of total current liabilities were other payable to third parties in the amount of $4.8 million and $4.6 million respectively. |
Convertible Note
Convertible Note | 3 Months Ended |
Mar. 31, 2019 | |
Notes Payable, Current [Abstract] | |
Convertible Note | Note 11. Convertible Note The following is the summary of outstanding convertible notes as of March 31, 2019: March 31, December 31, 2019 2018 Convertible Note-Mr. McMahon(Note 13 (a)) $ 3,169,644 $ 3,140,055 Convertible Note-SSSIG (Note 13 (a)) 1,142,917 1,000,000 Convertible Note-Advantech 11,664,914 11,313,770 Senior Secured Convertible Note 346,870 - Total $ 16,324,345 $ 15,453,825 Short-term Note 4,312,561 4,140,055 Long-term Note 12,011,784 11,313,770 On June 28, 2018, the Company entered into a convertible note purchase agreement with Advantech Capital Investment II Limited (“Advantech”) in the aggregate principal amount of $12,000,000 (the Notes). The Notes bear interest at a rate of 8%, mature on June 28, 2021, and are convertible into approximately 6,593,406 shares of the Company’s common stock at a conversion price of $ 1.82 per share. The difference between the conversion price and the fair market value of the common stock on the commitment date (transaction date) resulted in a beneficial conversion feature recorded of approximately $1.4 million. Total interest expense recognized relating to the beneficial conversion feature was $114,000 and $0.0 during the three months ended March 31, 2019 and 2018, respectively. The agreement also requires the Company to comply with certain covenants, including restrictions on the use of the proceeds and other convertible note offering. As of March 31, 2019, the Company was in compliance with all ratios and covenants. Issuance of Senior Secured Convertible Debenture On February 22, 2019, the Company executed a security purchase agreement with ID Venturas 7, LLC (“IDV”), whereby the Company issued $2,050,000 of senior secured convertible note. The note bears interest at a rate of 10% per year payable either in cash or in kind at the option of the Company on a quarterly basis and matures on August 22, 2020. In addition, IDV is entitled to the following: (i) the convertible note is senior secured; (ii) convertible at $1.84 per share of Company common stock at the option of IDV (approximately 1,114,130 shares), subject to adjustments if subsequent equity shares have a lower conversion price, (ii) 1,166,113 shares of common stock of the Company and (iii) a warrant exercisable for 150% of the number of shares of common stock which the Note is convertible into (approximately 1,671,196 shares) at an exercise price of $1.84 per share and will expire 5 years after issuance. The Company received aggregate gross proceeds of $2 million, net of $50,000 for the issuance expenses paid by IDV. Total funds received were allocated to convertible note, common stocks and warrants based on their relative fair values in accordance with ASC 470-20-30. The value of the convertible note and common stocks was based on the closing price on February 22, 2019. The fair value of the warrants was determined using the Black-Scholes option-pricing model, with the following assumptions: expected life of 5 years, expected dividend rate of 0%, volatility of 111.83% and an interest rate of 2.48%. The relative fair value of the warrants was recorded as additional paid-in capital and reduced the carrying amount of the convertible note. The Company recognized a beneficial conversion feature discount on convertible note at its intrinsic value, which was the fair value of the common stock at the commitment date for convertible note, less the effective conversion price. The Company recognized approximately $600,000 of beneficial conversion feature as an increase in additional paid in capital and reduced (discount on) the carrying amount of the convertible note in the accompanying consolidated balance sheet. The discounts on the convertible note for the warrants and beneficial conversion feature are being amortized to interest expense, using the effective interest method over the term of the convertible note. As of March 31, 2019, the unamortized discount on the convertible note is approximately $1,724,000. Total interest expense recognized relating to the discount was approximately $326,000 during the period ended March 31, 2019. Interest on the convertible note is payable quarterly starting from April 1, 2019. The convertible note is redeemable at the option of the Company in whole at an initial redemption price of the principal amount of the convertible note plus additional warrants and accrued and unpaid interest to the date of redemption. The security purchase agreement contains customary representations, warranties and covenants. The convertible note is collateralized by the Company’s equity interest in Grapevine, which had a carrying amount of $2.6 million as of March 31, 2019. The Company has the right to request for the removal of the guarantee and collateral by issuance of additional 250,000 shares of common stock. In addition, IDV has registration rights that require the Company to file and register the common stock issued or issuable upon conversion of the convertible note or the exercise of the warrants, within 180 days following the closing of the transaction. The Company is also subject to penalty fee at 8% per annum for late payments of interests and compensation for the loss of IDV on failure to timely deliver conversion shares upon conversion. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Note 12. Stockholders’ Equity Convertible Preferred Stock Our board of directors has authorized 50 million shares of convertible preferred stock, $0.001 par value, issuable in series. As of March 31, 2019 and December 31, 2018, 7,000,000 shares of Series A preferred stock were issued and outstanding and is convertible, at any time at the option of the holder, into 933,333 shares of common stock (subject to customary adjustments). The Series A preferred stock shall be entitled to ten vote per common stock on an as-converted basis and only entitled to receive dividends when and if declared by the board. On liquidation, both series of preferred stock are entitled to a liquidation preference of $0.50 per share. The shares are not redeemable except on liquidation or if there is a change in control of the Company or a sale of all or substantially all of the assets of the Company. The conversion price of the Series A may only be adjusted for standard anti-dilution, such as stock splits and similar events. The Series A preferred stocks are considered to be equity instruments and therefore the embedded conversion options have not been separated. Because the preferred stocks have conditions for their redemption that may be outside the control of the Company, they have been classified outside of Shareholders’ Equity, in the mezzanine section of our balance sheet. Common Stock Our board of directors has authorized 1,500 million shares of common stock, $0.001 par value. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 13. Related Party Transactions (a) Convertible Note $3.0 Million Convertible Note with Mr. Shane McMahon (“Mr. McMahon”) On May 10, 2012, Mr. McMahon, our Vice Chairman, made a loan to the Company in the amount of $3,000,000. In consideration for the loan, the Company issued a convertible note to Mr. McMahon in the aggregate principal amount of $3,000,000 (the “Note”) at a 4% interest rate computed on the basis of a 365-day year. We entered several amendments with respect to the effective conversion price (changed from $1.75 to $1.5), convertible stocks (changed from of Series E Preferred Stock to Common Stock) and extension of the maturity date to December 31, 2019. For the three months ended March 31, 2019 and 2018, the Company recorded interest expense of $29,589 and $30,000 related to the Note. Interest payable was $169,644 and $140,055 as of March 31, 2019 and December 31, 2018, respectively. $2.5 Million Convertible Promissory Note with Sun Seven Stars Investment Group Limited (“SSSIG”) On February 8, 2019, the Company entered into a convertible promissory note agreement with SSSIG, an affiliate of Mr. Wu, in the aggregate principal amount of $2,500,000. The convertible promissory note bear interest at a rate of 4%, matures on February 8, 2020, and are convertible into the shares of the Company’s common stock at a conversion price of $1.83 per share anytime at the option of SSSIG. As of March 31, 2019, the Company received $1.1 million from SSSIG. The Company has not received the remaining $1.4 million as of the date of this report. For the three months ended March 31, 2019, the Company recorded interest expense of $10,617 related to the note. (b) Transactions with GTD Disposal of Assets in exchange of GTB tokens In March 2019, the Company completed the sale of the following assets (with total carrying amount of approximately $20.4 million) to GTD, a minority shareholder based in Singapore, in exchange for 1,250,000 GTB tokens. The Company considers the arrangement is a nonmonetary transaction and the fair values of GTB tokens are not reasonably determinable due to the reasons described in Note 3. Therefore, GTB tokens received are recorded at the carrying amount of the assets exchanged and the Company did not recognize any gain or loss based on ASC 845-10-30. · License content (net carrying amount approximately $17.0 million) · Approximately 13% ownership interest in Nanjing Shengyi Network Technology Co., Ltd (“Topsgame”) (carrying amount approximately $3.2 million which was included in long-term investment-Non-marketable Equity Investment) · Animation copy right (net carrying amount approximately $0.2 million which was included in intangible asset.) Digital asset management services Please refer to Note 3. (c) Crude Oil Trading For the three months ended March 31, 2018, we purchased crude oil in the amount of approximately $162.3 million from two suppliers that a minority shareholder of the Company has significant influence upon because this minority shareholder has significant influence on both our Singapore joint venture and these two suppliers. The Company has recorded the purchase on a separate line item referenced as “Cost of revenue from related parties” in its financial statements. There is no outstanding balances due (in Accounts Payable) as of March 31, 2019. No such related party transactions occurred for the same period in 2019. (d) Severance payments On February 20, 2019, the Company accepted the resignation of former Chief Executive Officer, former Chief Investment Officer and former Chief Strategy Officer and agreed to pay approximately $837,000 in total for salary, severance and expenses. The Company paid $637,000 in the first quarter of year 2019 and recorded $200,000 in other current liabilities on our consolidated balance sheet as of March 31, 2019. |
Share-Based Payments
Share-Based Payments | 3 Months Ended |
Mar. 31, 2019 | |
Compensation and Retirement Disclosure [Abstract] | |
Share-Based Payments | Note 14. Share-Based Payments As of March 31, 2019, the Company had 1,646,431 options, 87,586 restricted shares and 1,671,196 warrants outstanding. The Company awards common stock and stock options to employees and directors as compensation for their services, and accounts for its stock option awards to employees and directors pursuant to the provisions of ASC 718, Stock Compensation Effective as of December 3, 2010 and amended on August 3, 2018, our Board of Directors approved the 2010 Stock Incentive Plan (“the 2010 Plan”) pursuant to which options or other similar securities may be granted. As of March 31, 2019, the maximum aggregate number of shares of our common stock that may be issued under the 2010 Plan is 31,500,000 shares. As of March 31, 2019, options available for issuance are 27,575,499 shares. For the three months ended March 31, 2019 and 2018, total share-based payments expense was approximately $224,000 and $121,000, respectively. (a) Stock Options Stock option activity for the three months ended March 31, 2019 is summarized as follows: Weighted Weighted Average Average Remaining Aggregated Options Exercise Contractual Intrinsic Outstanding Price Life (Years) Value Outstanding at January 1, 2019 1,706,431 $ 3.28 4.08 $ - Granted - - - - Exercised - - - - Expired - - - - Forfeited (60,000 ) 1.91 - - Outstanding at March 31, 2019 1,646,431 $ 3.33 3.66 $ 54,565 Vested and expected to be vested as of March 31, 2019 1,646,431 $ 3.33 3.66 $ 54,565 Options exercisable at March 31, 2019 (vested) 1,634,348 $ 3.34 3.63 $ 53,365 As of March 31, 2019, approximately $12,448 of total unrecognized compensation expense related to non-vested share options is expected to be recognized over a weighted average period of approximately 0.61 years. The total fair value of shares vested for the three months ended March 31, 2019 and 2018 was $6,312 and $312,688 respectively. Cash received from options exercised during the three months ended March 31, 2019 and 2018 was approximately $0.0 and $2,632. (b) Warrants In connection with the Company’s financings, the Warner Brother Agreement and the service agreements, the Company issued warrants to service providers to purchase common stock of the Company. The warrants issued to Warner Brother were expired without exercise on January 31, 2019. The Company issued warrants to IDV in connection with senior secured convertible note (See Note 11) and the weighted average exercise price was $1.84 and the weighted average remaining life was 5 years. March 31, 2019 December 31, 2018 Number of Number of Warrants Warrants Outstanding and Outstanding and Exercise Expiration Warrants Outstanding Exercisable Exercisable Price Date 2014 Broker Warrants (Series E Financing) - 60,000 $ 1.75 01/31/19 2018 IDV (Senior secured convertible note ) 1,671,196 - $ 1.84 2/22/2024 1,671,196 60,000 On September 24, 2018, the Company entered into an employment agreements with three executives. As part of their employment agreements, they are entitled to warrants for an aggregate of 8,000,000 shares at an exercise price of $5.375 per share (the “Exercise Price”), which is a 25% premium to the $4.30 per share closing market price of the Company’s common stock on September 7, 2018, the date upon which the terms of the employment agreements were mutually agreed. In February 2019, the rights to receive warrants were terminated due to the resignation of three executives. (c) Restricted Shares In January 2019, the Company granted 129,840 restricted shares to each of two then independent directors under the “2010 Plan” which was approved by the Board of Directors for year 2018 independent board compensation plan. The restricted shares were all vested immediately since commencement date. The aggregated grant date fair value of all those restricted shares was $161,001. A summary of the unvested restricted shares is as follows: Weighted-average Shares fair value Non-vested restricted shares outstanding at January 1, 2019 87,586 $ 2.46 Granted 129,840 $ 1.24 Forfeited - $ - Vested (129,840 ) $ 1.24 Non-vested restricted shares outstanding at March 31, 2019 87,586 $ 2.46 As of March 31, 2019, there was $106,600 of unrecognized compensation cost related to unvested restricted shares. This amount is expected to be recognized over a weighted-average period of 1.01 years. |
Earnings (Loss) Per Common Shar
Earnings (Loss) Per Common Share | 3 Months Ended |
Mar. 31, 2019 | |
Net earning (loss) per share | |
Earnings (Loss) Per Common Share | Note 15. Earnings (Loss) Per Common Share Basic earnings (loss) per common share attributable to our shareholders is calculated by dividing the net earnings (loss) attributable to our shareholders by the weighted average number of outstanding common shares during the period. Diluted earnings (loss) per share is calculated by taking net earnings (loss), divided by the diluted weighted average common shares outstanding. The calculations of basic and diluted earnings (loss) per share for the three months ended, 2019 and 2018 are as follows: For the periods ended March 31, 2019 2018 Net earnings (loss) attributable to common stockholders $ 19,926,515 $ (3,721,369 ) Interest expense attributable to convertible promissory notes 738,219 - Net earnings (loss) assuming dilution $ 20,664,734 $ (3,721,369 ) Basic weighted average common shares outstanding 105,345,673 68,816,303 Effect of dilutive securities Convertible preferred shares- Series A 933,333 - Convertible promissory notes 10,022,230 - Diluted potential common shares 116,301,236 68,816,303 Earnings (loss) per share: Basic $ 0.19 $ (0.05 ) Diluted $ 0.18 $ (0.05 ) Diluted net loss per share equals basic net loss per share because the effect of securities convertible into common shares is anti-dilutive. The following table includes the number of shares that may be dilutive potential common shares in the future. The holders of these shares do not have a contractual obligation to share in our earnings (losses) and thus these shares were not included in the computation of diluted earnings (loss) per share because the effect was antidilutive. March 31, December 31, 2019 2018 Warrants 1,671,196 60,000 Options 1,646,431 1,706,431 Series A Preferred Stock - 933,333 Convertible promissory note and interest - 10,407,233 Total 3,317,627 13,106,997 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 16. Income Taxes During the three months ended March 31, 2019, the Company recorded an income tax benefit of $86,405 which consisted of a $4,750,449 expense related to current operations and a $4,836,854 benefit from a reduction in the beginning of the year deferred tax valuation allowance. This resulted in an effective tax rate of (1%). The effective tax rate for the three months ended March 31, 2019 differs from the U.S. statutory tax rate primarily due to the effect of taxes on foreign earnings, non-deductible expenses and the reduction in the beginning of the year deferred tax valuation allowance. There was no identified unrecognized tax benefit as of March 31, 2018 and 2019. |
Contingencies and Commitments
Contingencies and Commitments | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies and Commitments | Note 17. Contingencies and Commitments Lawsuits and Legal Proceedings From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. As of March 31, 2019, there are no such legal proceedings or claims that we believe will have a material adverse effect on our business, financial condition or operating results. |
Concentration, Credit and Other
Concentration, Credit and Other Risks | 3 Months Ended |
Mar. 31, 2019 | |
Risks and Uncertainties [Abstract] | |
Concentration, Credit and Other Risks | Note 18. Concentration, Credit and Other Risks (a) PRC Regulations The PRC market in which the Company operates poses certain macro-economic and regulatory risks and uncertainties. These uncertainties extend to the ability of the Company to conduct wireless telecommunication services through contractual arrangements in the PRC since the industry remains highly regulated. The Company conducts legacy YOD business in China through a series of contractual arrangements (See Note 4). The Company believes that these contractual arrangements are in compliance with PRC law and are legally enforceable. If Sinotop Beijing, SSF or their respective legal shareholders fail to perform the obligations under the contractual arrangements or any dispute relating to these contracts remains unresolved, We can enforce its rights under the VIE contracts through PRC law and courts. However, uncertainties in the PRC legal system could limit the Company’s ability to enforce these contractual arrangements. In particular, the interpretation and enforcement of these laws, rules and regulations involve uncertainties. If we had direct ownership of Sinotop Beijing and SSF, it would be able to exercise its rights as a shareholder to effect changes in the board of directors of Sinotop Beijing or SSF, which in turn could effect changes at the management level, subject to any applicable fiduciary obligations. However, under the current contractual arrangements, the Company relies on Sinotop Beijing, SSF and their respective legal shareholders to perform their contractual obligations to exercise effective control. The Company also gives no assurance that PRC government authorities will not take a view in the future that is contrary to the opinion of the Company. If the current ownership structure of the Company and its contractual arrangements with the VIEs and their equity holders were found to be in violation of any existing or future PRC laws or regulations, the Company's ability to conduct its business could be affected and the Company may be required to restructure its ownership structure and operations in the PRC to comply with the changes in the PRC laws which may result in deconsolidation of the VIEs. In addition, the telecommunications, information and media industries remain highly regulated. Restrictions are currently in place and are unclear with respect to which segments of these industries foreign owned entities, like YOD WFOE, may operate. The PRC government may issue from time to time new laws or new interpretations on existing laws to regulate areas such as telecommunications, information and media, some of which are not published on a timely basis or may have retroactive effect. For example, there is substantial uncertainty regarding the Draft Foreign Investment Law, including, among others, what the actual content of the law will be as well as the adoption and effective date of the final form of the law. Administrative and court proceedings in China may also be protracted, resulting in substantial costs and diversion of resources and management attention. While such uncertainty exists, the Company cannot assure that the new laws, when it is adopted and becomes effective, and potential related administrative proceedings will not have a material and adverse effect on the Company's ability to control the affiliated entities through the contractual arrangements. Regulatory risk also encompasses the interpretation by the tax authorities of current tax laws, and the Company’s legal structure and scope of operations in the PRC, which could be subject to further restrictions resulting in limitations on the Company’s ability to conduct business in the PRC. (b) Major Customers Wecast Services is currently primarily engaged with consumer electronics e-commerce and smart supply chain management operations. The Company’s ending customers are located across the world. For the three months ended March 31, 2018, one customer individually accounted for more than 10% of the Company’s third parties revenue. Two customers individually accounted for more than 10% of the Company’s net accounts receivables as of March 31, 2018, respectively. For the three months ended March 31, 2019, one customer individually accounted for more than 10% of the Company’s revenue. Two customers individually accounted for more than 10% of the Company’s net accounts receivables as of March 31, 2019, respectively. (c) Major Suppliers For the three months ended March 31, 2018, one supplier individually accounted for more than 10% of the Company’s cost of revenues. One supplier individually accounted for more than 10% of the Company’s accounts payable and amount due to related parties as of March 31, 2018. For the three months ended March 31, 2019, two suppliers individually accounted for more than 10% of the Company’s accounts payable as of March 31, 2019. (d) Concentration of Credit Risks Financial instruments that potentially subject the Company to significant concentration of credit risk primarily consist of cash and accounts receivable. As of March 31, 2019 and December 31, 2018, the Company’s cash was held by financial institutions (located in the PRC, Hong Kong, the United States and Singapore) that management believes have acceptable credit. Accounts receivable are typically unsecured and are mainly derived from revenues from Wecast Services. The risk with respect to accounts receivable is mitigated by regular credit evaluations that the Company performs on its distribution partners and its ongoing monitoring of outstanding balances. (e) Foreign Currency Risks We have certain operating transactions are denominated in RMB and a portion of the Company’s assets and liabilities is denominated in RMB. RMB is not freely convertible into foreign currencies. The value of the RMB is subject to changes in the central government policies and to international economic and political developments. In the PRC, certain foreign exchange transactions are required by laws to be transacted only by authorized financial institutions at exchange rates set by the People’s Bank of China (“PBOC”). Remittances in currencies other than RMB by the Company in China must be processed through PBOC or other China foreign exchange regulatory bodies which require certain supporting documentation in order to complete the remittance. Cash consist of cash on hand and demand deposits at banks, which are unrestricted as to withdrawal. Time deposits, which mature within one year as of the balance sheet date, represent interest-bearing certificates of deposit with an initial term of greater than three months when purchased. Time deposits which mature over one year as of the balance sheet date are included in non-current assets. Cash and time deposits maintained at banks consist of the following: March 31, December 31, 2019 2018 RMB denominated bank deposits with financial institutions in the PRC $ 483,829 $ 1,523,622 US dollar denominated bank deposits with financial institutions in the PRC $ 24,436 $ 133,053 HKD denominated bank deposits with financial institutions in Hong Kong Special Administrative Region (“HK SAR”) $ 215 $ 13,133 US dollar denominated bank deposits with financial institutions in Hong Kong Special Administrative Region (“HK SAR”) $ 35,381 $ 44,182 US dollar denominated bank deposits with financial institutions in Singapore (“Singapore”) $ 687,151 $ 697,099 US dollar denominated bank deposits with financial institutions in The United States of America (“USA”) $ 780,886 $ 695,155 Total $ 2,011,898 $ 3,106,244 As of March 31, 2019 and December 31, 2018, there were no deposits insured. To limit exposure to credit risk relating to bank deposits, the Company primarily places bank deposits only with large financial institutions in the PRC, HK SAR, USA, Singapore and Cayman with acceptable credit rating. (f) Digital Token Risks As of March 31, 2019, the Company holds 8,333,333 GTB tokens. The risks related to our holdings of GTB tokens including: · Digital token is highly volatile due to the limited trading history, and singular currency exchange platform; · Under the circumstances where governments prohibit or effectively prohibit the trading of digital token, this will significantly impact the financial statements of the Company since the digital token market is currently largely unregulated; and · The Company is also subject to cybersecurity risk where hacking and breach of information will result in the loss of assets. |
Defined Contribution Plan
Defined Contribution Plan | 3 Months Ended |
Mar. 31, 2019 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |
Defined Contribution Plan | Note 19. Defined Contribution Plan For our U.S. employees, during 2011, the Company began sponsoring a 401(k) defined contribution plan ("401(k) Plan") that provides for a 100% employer matching contribution of the first 3% and a 50% employer matching contribution of each additional percent contributed by an employee up to 5% of each employee’s pay. Employees become fully vested in employer matching contributions after six months of employment. Company 401(k) matching contributions were approximately $0.0 and $14,486 for the three months ended March 31, 2019 and 2018, respectively. Full time employees in the PRC participate in a government-mandated defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance, employee housing fund and other welfare benefits are provided to employees. PRC labor regulations require the Company to make contributions based on certain percentages of the employees’ basic salaries. Other than such contributions, there is no further obligation under these plans. The total contribution for such PRC employee benefits was $77,199 and $211,704 for the three months ended March 31, 2019 and 2018, respectively. |
Segments and Geographic Areas
Segments and Geographic Areas | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Segments and Geographic Areas | Note 20. Segments and Geographic Areas The Company’s chief operating decision maker has been identified as the chief executive officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company. We operate our business in two operating segments: Legacy YOD and Wecast Service. Segment disclosures are on a performance basis consistent with internal management reporting. The Company does not allocate expenses below segment gross profit since these segments share the same executive team, office space, occupancy expenses, information technology infrastructures, human resources and finance department. Information about segments during the periods presented were as follows: Three Months Ended March 31, 2019 March 31, 2018 NET SALES TO EXTERNAL CUSTOMERS -Legacy YOD $ - $ - -Wecast Service 26,945,564 185,933,821 Net sales 26,945,564 185,933,821 Cost of Sales -Legacy YOD - - -Wecast Service 257,406 185,540,685 Gross profit $ 26,688,158 $ 393,136 March 31, 2019 December 31, 2018 TOTAL ASSETS -Legacy YOD $ 10,578,437 $ 26,442,810 -Wecast Service 135,643,801 51,592,929 -Unallocated assets - 16,199,383 Total $ 146,222,238 $ 94,235,122 |
Going Concern and Management's
Going Concern and Management's Plans | 3 Months Ended |
Mar. 31, 2019 | |
Going Concern And Managements Plans [Abstract] | |
Going Concern and Management's Plans | Note 21. Going Concern and Management’s Plans As of March 31, 2019, the Company had cash and cash equivalents of approximately $2.0 million and the Company has incurred losses since its inception and must continue to rely on proceeds from debt and equity issuances to pay for ongoing operating expenses in order to execute its business plan. Management has taken several actions below to ensure that the Company will continue as a going concern through May 31, 2020, including reductions in YOD legacy segment related expenses and discretionary expenditures. · As discussed in Note 13, the Company has entered into a convertible note agreement with SSSIG in which it will receive approximately $1.4 million in additional cash during 2019; and · As of March 31, 2019, the Company holds 8,333,333 GTB tokens and we may convert all or a portion of our GTB tokens to fiat currency or into U.S. Dollars as needed. As part of the Company’s strategy, management raised these recent capital to cover short and medium term cash needs, while it plans to unlock revenue from its new fintech advisory services business in 2019. Therefore, the Company does not plan to take additional outside investments in the near term, unless there is a delay in product expectations and sales. Although the Company may attempt to raise funds by issuing debt or equity instruments, in the future additional financing may not be available to the Company on terms acceptable to the Company or at all or such resources may not be received in a timely manner. If the Company is unable to raise additional capital when required or on acceptable terms, the Company may be required to scale back or to discontinue certain operations, scale back or discontinue the development of new business lines, reduce headcount, sell assets, file for bankruptcy, reorganize, merge with another entity, or cease operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements have been prepared assuming that the Company will continue as a going concern and, accordingly, do not include any adjustments that might result from the outcome of this uncertainty. If the Company is in fact unable to continue as a going concern, the shareholders may lose their entire investment in the Company. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 22. Subsequent Events The Company evaluated subsequent events through May 2, 2019, the date the unaudited consolidated financial statements were issued. With the exception of the matter discussed in Notes 8 (v), there were no material subsequent events that required recognition or additional disclosure in the consolidated financial statements. |
Summary of Significant Accounti
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation In this Form 10-Q, unless the context otherwise requires, the use of the terms "we," "us", "our" and the “Company” refers to Ideanomics, Inc, its consolidated subsidiaries and variable interest entities (“VIEs”). On April 24, 2018, the Company completed the acquisition of 100% equity ownership in Shanghai Guang Ming Investment Management (“Guang Ming”), a PRC limited liability company. One of the two selling shareholders is a related party, an affiliate of Dr. Wu. Guang Ming holds a special fund management license. The acquisition will help the Company develop a fund management platform. Under Accounting Standard Codification (“ASC”) 805-50-05-5 and ASC 805-50-30-5, the transaction was accounted for as a reorganization of entities under common control, in a manner similar to a pooling of interest, using historical costs. As a result of the reorganization, the net assets of Guang Ming were transferred to the Company, and the accompanying consolidated financial statements as of and for the three months ended March 31, 2018 have been prepared as if the current corporate structure had been in place at the beginning of periods presented in which the common control existed. In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair statements of the financial position as of March 31, 2019, results of operations for the three months ended March 31, 2019 and 2018, and cash flows for the three months ended March 31, 2019 and 2018, have been made. All significant intercompany transactions and balances are eliminated on consolidation. However, the results of operations included in such financial statements may not necessary be indicative of annual results. We use the same accounting policies in preparing quarterly and annual financial statements. Certain information and footnote disclosures normally included in the annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. These unaudited consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission on April 1, 2019 (“2018 Annual Report”). |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the related disclosure of contingent assets and liabilities. Actual results could differ from those estimates. On an ongoing basis, we evaluate our estimates, including those related to the bad debt allowance, variable considerations, fair values of financial instruments, intangible assets (including digital tokens) and goodwill, useful lives of intangible assets and property and equipment, asset retirement obligations, income taxes, and contingent liabilities, among others. We base our estimates on assumptions, both historical and forward looking, that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. |
Fair Value Measurements | Fair Value Measurements Accounting standards require the categorization of financial assets and liabilities, based on the inputs to the valuation technique, into a three-level fair value hierarchy. The various levels of the fair value hierarchy are described as follows: • Level 1 - Financial assets and liabilities whose values are based on unadjusted quoted market prices for identical assets and liabilities in an active market that we have the ability to access. • Level 2 - Financial assets and liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable for substantially the full term of the asset or liability. • Level 3 - Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company reviews the valuation techniques used to determine if the fair value measurements are still appropriate on an annual basis, and evaluate and adjust the unobservable inputs used in the fair value measurements based on current market conditions and third party information. Our financial assets and liabilities that are measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, other current liabilities and convertible notes. The fair values of these assets approximate carrying values because of the short-term nature of these instruments. If these instruments were measured at fair value in the financial statements, they would be classified as Level 1 in the fair value hierarchy. Our financial assets that are measured at fair value on a nonrecurring basis include goodwill and other intangible assets, asset retirement obligations, and adjustment in carrying value of equity securities for which the measurement alternative of cost less impairment plus or minus observable price changes is used. There were no material impairments and no material adjustments to equity securities using the measurement alternative for the three months ended March 31, 2019 and 2018. |
Digital Tokens | Digital Tokens Digital tokens consist of GTB tokens received in connection with the services agreement and assets purchase agreement with GT Dollar Pte. Ltd. (“GTD”), our minority shareholder (Note 3 and 13 (b)). Given that there is limited precedent regarding the classification and measurement of cryptocurrencies and other digital tokens under current GAAP, the Company has determined to account for these tokens as indefinite-lived intangible assets in accordance with ASC 350, Intangibles—Goodwill and Other until further guidance is issued by the FASB. Indefinite-lived intangible assets are recorded at cost and are not subject to amortization, but shall be tested for impairment annually and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. If, at the time of an impairment test, the carrying amount of an intangible asset exceeds its fair value, an impairment loss in an amount equal to the excess is recognized. The fair value of GTB tokens was a Level 2 measurement (see Note 3) based upon the consideration agreed by GTD and the Company with a discount considering volatility, risk and limitations at contract inception. |
Reclassifications of a General Nature | Reclassifications of a General Nature Certain amounts in the prior periods presented have been reclassified to conform to the current period financial statement presentation. These reclassifications have no effect on previously reported net income. Note 2 provides information about our adoption of new accounting standards for leases. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements We adopted Financial Accounting Standards Board (FASB) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842), as of January 1, 2019, using a modified retrospective transition method and as a result, the consolidated balance sheet prior to January 1, 2019 was not restated, continues to be reported under ASC Topic 840, Leases, or ASC 840. For all leases at the lease commencement date, a right-of-use asset and a lease liability are recognized. The right-of-use asset represents the right to use the leased asset for the lease term. The lease liability represents the present value of the lease payments under the lease. The lease liability is based on the present value of the remaining minimum lease payments, determined under ASC 840, discounted using our incremental borrowing rate at the effective date of January 1, 2019, using the original lease term as the tenor. As permitted under the transition guidance, we elected several practical expedients that permit us to not reassess (1) whether a contract is or contains a lease, (2) the classification of existing leases, and (3) whether previously capitalized costs continue to qualify as initial indirect costs. The application of the practical expedients did not have a significant impact on the measurement of the operating lease liability. Adoption of the new standard resulted in the recording of operating right of use assets and the related lease liabilities of approximately $3.6 million and $3.7 million, respectively, as of January 1, 2019. The difference between the additional lease assets and lease liabilities was immaterial. The standard did not materially impact our consolidated operating results and had no impact on cash flows. Please see Note 9. In June 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which largely aligns the measurement and classification guidance for share-based payments to nonemployees with the guidance for share-based payments to employees. The ASU also clarifies that any share-based payment issued to a customer should be evaluated under ASC 606, Revenue from Contracts with Customers In July 2017, the FASB issued ASU No. 2017-11, (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. The new standard applies to issuers of financial instruments with down-round features. A down-round provision is a term in an equity-linked financial instrument (i.e. a freestanding warrant contract or an equity conversion feature embedded within a host debt or equity contract) that triggers a downward adjustment to the instrument’s strike price (or conversion price) if equity shares are issued at a lower price (or equity-linked financial instruments are issued at a lower strike price) than the instrument’s then-current strike price. The purpose of the feature is typically to protect the instrument’s counterparty from future issuances of equity shares at a more favorable price. The ASU amends (1) the classification of such instruments as liabilities or equity by revising the certain guidance relative to evaluating if they must be accounted for as derivative instruments and (2) the guidance on recognition and measurement of freestanding equity-classified instruments. For the Company, this ASU was effective January 1, 2019. Please see Note 11. Standards Issued and Not Yet Adopted In June 2016, the FASB issued Accounting Standards Update No. 2016-13 (ASU 2016-13) "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. We will adopt ASU 2016-13 effective January 1, 2020. We are currently evaluating the effect of the adoption of ASU 2016-13 on our consolidated financial statements. The effect will largely depend on the composition and credit quality of our investment portfolio and the economic conditions at the time of adoption. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of revenues disaggregated by revenue source, geography and timing of revenue recognition | Three Months Ended March 31, 2019 March 31, 2018 Geographic Markets Singapore $ - $ 178,178,605 USA 26,945,564 - Hong Kong - 7,755,216 $ 26,945,564 $ 185,933,821 Services Lines -Wecast Service Crude oil $ - $ 178,178,605 Consumer electronics - 7,613,113 Digital asset management services 26,600,000 - Digital advertising services and other 345,564 142,103 26,945,564 185,933,821 -Legacy YOD - - Total $ 26,945,564 $ 185, 933,821 Timing of Revenue Recognition Products transferred at a point in time $ 345,564 $ 185, 933,821 Services provided over time 26,600,000 - Total $ 26,945,564 $ 185, 933,821 |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | March 31, December 31, 2019 2018 Furniture and office equipment $ 345,541 $ 357,064 Vehicle 64,632 63,135 Leasehold improvements 198,584 200,435 Total property and equipment 608,757 620,634 Less: accumulated depreciation (196,566 ) (186,514 ) Construction in progress (Fintech Village) 15,181,064 14,595,307 Property and Equipment, net $ 15,593,255 $ 15,029,427 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of amortizing and indefinite lived intangible assets | March 31, 2019 December 31, 2018 Weight Gross Accumulated Impairment Net Gross Accumulated Impairment Net Useful Life Amount Amortization Loss Balance Amount Amortization Loss Balance Amortizing Intangible Assets Animation Copyright (Note 13 (b)) - $ - $ - $ - $ - $ 301,495 $ (64,606 ) $ - $ 236,889 Software and licenses - 97,308 (95,648 ) - 1,660 97,308 (93,251 ) - 4,057 Intellectual property (Note 5 (a)) 4.9 4,655,000 (77,583 ) - 4,577,417 - - - - Influencer network 9.5 1,980,000 (115,500 ) - 1,864,500 1,980,000 (66,000 ) - 1,914,000 Customer contract 2.5 500,000 (97,223 ) - 402,777 500,000 (55,556 ) - 444,444 Trade name 14.5 110,000 (4,277 ) - 105,723 110,000 (2,444 ) - 107,556 Technology platform 6.5 290,000 (24,165 ) - 265,835 290,000 (13,808 ) - 276,192 Total amortizing intangible assets $ 7,632,308 $ (414,396 ) $ - $ 7,217,912 $ 3,278,803 $ (295,665 ) $ - $ 2,983,138 Indefinite lived intangible assets Website name 25,214 - - 25,214 159,504 - (134,290 ) 25,214 Patent 28,000 - - 28,000 28,000 - - 28,000 GTB Tokens (Note 13 (b)) 61,123,506 - - 61,123,506 - - - - Total intangible assets $ 68,809,028 $ (414,396 ) $ - $ 68,394,632 $ 3,466,307 $ (295,665 ) $ (134,290 ) $ 3,036,352 |
Schedule of amortization expense | Amortization to be Years ending December 31, recognized 2019 (excluding the three months ended March 31, 2019) $ 1,198,499 2020 1,344,429 2021 1,288,873 2022 1,177,762 2023 and thereafter 2,208,350 Total amortization to be recognized $ 7,217,913 |
Long-term Investments (Tables)
Long-term Investments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of non-marketable equity investment | March 31, December 31, 2019 2018 Non-marketable Equity Investment $ 6,266,880 $ 9,452,103 Equity Method Investment 16,676,714 16,956,506 Total $ 22,943,594 $ 26,408,609 |
Schedule of long term investment under equity method | March 31, 2019 Foreign currency December 31, Loss on Impairment translation 2018 Addition investment loss adjustments March 31, 2019 Wecast Internet (i) $ 4,114 $ - $ (5 ) $ - $ 1,930 $ 6,039 Hua Cheng (ii) 308,666 - (14,598 ) - (1,236 ) 292,832 BDCG (iv) 9,800,000 - - - - 9,800,000 DBOT (v) 6,843,726 - (265,883 ) - - 6,577,843 Total $ 16,956,506 $ - $ (280,486 ) $ - $ 694 $ 16,676,714 All the investments above are privately held companies; therefore, quoted market prices are not available. We have not received any dividends since initial investments. (i) Wecast Internet Starting from October 2016, we have 50% interest in Wecast Internet Limited (“Wecast Internet”) and initial investment was invested RMB 1,000,000 (approximately $149,750). Wecast Internet is in the process of liquidation and the remaining carrying value is immaterial. (ii) Hua Cheng Hu Dong (Beijing) Film and Television Communication Co., Ltd.(“Hua Cheng”) The Company held 39% equity ownership in Hua Cheng, a company established to provide integrated value-added service solutions for the delivery of VOD and enhanced content for cable providers. (iii) Shandong Lushi Media Co., Ltd (“Shandong Media”) The Company held 30% equity ownership in Shandong Media, a print based media business, for Legacy YOD business. The accumulated operating loss of Shandong Media reduced the Company’s investment in Shandong Media to zero. The Company has no obligation to fund future operating losses. (iv) BBD Digital Capital Group Ltd. (“BDCG”) In 2018, we signed a joint venture agreement with two unrelated parties, to establish BDCG located in the United States for providing block chain services for financial or energy industries by utilizing AI and big data technology in the United States. On April 24, 2018, the Company acquired 20% equity ownership in BDCG from one noncontrolling party with cash consideration of a total consideration of $9.8 million which consists of $2 million in cash and $7.8 million paid in the form of the Company’s capital stock (valued at $2.60 per share and equal to 3 million shares of the Company’s common stock), increasing the Company’s ownership to 60%. The remaining 40% of BDCG are held by Seasail ventures limited (“Seasail”). The accounting treatment of the joint venture is based on the equity method due to variable substantive participating rights (in accordance with ASC 810-10-25-11) granted to Seasail. The new entity is currently in the process of ramping up its operations. In April 2019, the company rebranded the name of the BDCG joint venture to Intelligenta. As part of the rebranding, Intelligenta’s strategy will now include credit services, corporation services, index services and products, and capital market services and products. (v) Delaware Board of Trade Holdings, Inc. (“DBOT”) As of March 31, 2019, the Company held 36.92% equity ownership in DBOT. DBOT is an approved and licensed FINRA- and SEC-regulated electronic trading platform with operations in Delaware. One of our subsidiaries is powered by DBOT’s platform, trading system and technology. |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Schedule of maturity of operating lease liability | Maturity of Lease Liability Operating Lease 2019 $ 1,320,442 2020 1,177,261 2021 1,202,496 2022 1,294,781 2023 1,343,668 After 2024 2,529,735 Total lease payments 8,868,383 Less: Interest (1,824,219 ) Total $ 7,044,164 |
Convertible Note (Tables)
Convertible Note (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Notes Payable, Current [Abstract] | |
Schedule of of outstanding convertible notes | March 31, December 31, 2019 2018 Convertible Note-Mr. McMahon(Note 13 (a)) $ 3,169,644 $ 3,140,055 Convertible Note-SSSIG (Note 13 (a)) 1,142,917 1,000,000 Convertible Note-Advantech 11,664,914 11,313,770 Senior Secured Convertible Note 346,870 - Total $ 16,324,345 $ 15,453,825 Short-term Note 4,312,561 4,140,055 Long-term Note 12,011,784 11,313,770 |
Share-Based Payments (Tables)
Share-Based Payments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Compensation and Retirement Disclosure [Abstract] | |
Schedule of stock option activity | Weighted Weighted Average Average Remaining Aggregated Options Exercise Contractual Intrinsic Outstanding Price Life (Years) Value Outstanding at January 1, 2019 1,706,431 $ 3.28 4.08 $ - Granted - - - - Exercised - - - - Expired - - - - Forfeited (60,000 ) 1.91 - - Outstanding at March 31, 2019 1,646,431 $ 3.33 3.66 $ 54,565 Vested and expected to be vested as of March 31, 2019 1,646,431 $ 3.33 3.66 $ 54,565 Options exercisable at March 31, 2019 (vested) 1,634,348 $ 3.34 3.63 $ 53,365 |
Schedule of warrants outstanding and exercisable | March 31, 2019 December 31, 2018 Number of Number of Warrants Warrants Outstanding and Outstanding and Exercise Expiration Warrants Outstanding Exercisable Exercisable Price Date 2014 Broker Warrants (Series E Financing) - 60,000 $ 1.75 01/31/19 2018 IDV (Senior secured convertible note ) 1,671,196 - $ 1.84 2/22/2024 1,671,196 60,000 |
Schedule of summary of restricted shares | Weighted-average Shares fair value Non-vested restricted shares outstanding at January 1, 2019 87,586 $ 2.46 Granted 129,840 $ 1.24 Forfeited - $ - Vested (129,840 ) $ 1.24 Non-vested restricted shares outstanding at March 31, 2019 87,586 $ 2.46 |
Earnings (Loss) Per Common Sh_2
Earnings (Loss) Per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Net earning (loss) per share | |
Schedule of component of loss per common share | For the periods ended March 31, 2019 2018 Net earnings (loss) attributable to common stockholders $ 19,926,515 $ (3,721,369 ) Interest expense attributable to convertible promissory notes 738,219 - Net earnings (loss) assuming dilution $ 20,664,734 $ (3,721,369 ) Basic weighted average common shares outstanding 105,345,673 68,816,303 Effect of dilutive securities Convertible preferred shares- Series A 933,333 - Convertible promissory notes 10,022,230 - Diluted potential common shares 116,301,236 68,816,303 Earnings (loss) per share: Basic $ 0.19 $ (0.05 ) Diluted $ 0.18 $ (0.05 ) |
Schedule of number of securities convertible into common shares | March 31, December 31, 2019 2018 Warrants 1,671,196 60,000 Options 1,646,431 1,706,431 Series A Preferred Stock - 933,333 Convertible promissory note and interest - 10,407,233 Total 3,317,627 13,106,997 |
Concentration, Credit and Oth_2
Concentration, Credit and Other Risks (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Risks and Uncertainties [Abstract] | |
Schedule of demand deposits | March 31, December 31, 2019 2018 RMB denominated bank deposits with financial institutions in the PRC $ 483,829 $ 1,523,622 US dollar denominated bank deposits with financial institutions in the PRC $ 24,436 $ 133,053 HKD denominated bank deposits with financial institutions in Hong Kong Special Administrative Region (“HK SAR”) $ 215 $ 13,133 US dollar denominated bank deposits with financial institutions in Hong Kong Special Administrative Region (“HK SAR”) $ 35,381 $ 44,182 US dollar denominated bank deposits with financial institutions in Singapore (“Singapore”) $ 687,151 $ 697,099 US dollar denominated bank deposits with financial institutions in The United States of America (“USA”) $ 780,886 $ 695,155 Total $ 2,011,898 $ 3,106,244 |
Segments and Geographic Areas (
Segments and Geographic Areas (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Company's revenue and cost generated from different revenue streams | Three Months Ended March 31, 2019 March 31, 2018 NET SALES TO EXTERNAL CUSTOMERS -Legacy YOD $ - $ - -Wecast Service 26,945,564 185,933,821 Net sales 26,945,564 185,933,821 Cost of Sales -Legacy YOD - - -Wecast Service 257,406 185,540,685 Gross profit $ 26,688,158 $ 393,136 March 31, 2019 December 31, 2018 TOTAL ASSETS -Legacy YOD $ 10,578,437 $ 26,442,810 -Wecast Service 135,643,801 51,592,929 -Unallocated assets - 16,199,383 Total $ 146,222,238 $ 94,235,122 |
Nature of Operations and Summ_2
Nature of Operations and Summary of Significant Accounting Policies (Detail Textuals) | Apr. 24, 2018 |
Shanghai Guang Ming Investment Management ("Guang Ming") | |
Business Acquisition [Line Items] | |
Percentage of equity ownership | 100.00% |
New Accounting Pronouncements (
New Accounting Pronouncements (Detail Textuals) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating right of use assets | $ 6,802,721 | |
Operating lease liability | $ 7,044,164 | |
Accounting Standards Update 840 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating right of use assets | $ 3,600,000,000 | |
Operating lease liability | $ 3,700,000 |
Revenue (Details)
Revenue (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Total | $ 26,945,564 | $ 185,933,821 |
Products transferred at a point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total | 345,564 | 185,933,821 |
Services provided over time | ||
Disaggregation of Revenue [Line Items] | ||
Total | 26,600,000 | 0 |
Singapore | ||
Disaggregation of Revenue [Line Items] | ||
Total | 0 | 178,178,605 |
USA | ||
Disaggregation of Revenue [Line Items] | ||
Total | 26,945,564 | 0 |
Hong Kong | ||
Disaggregation of Revenue [Line Items] | ||
Total | 0 | 7,755,216 |
Wecast Services | ||
Disaggregation of Revenue [Line Items] | ||
Total | 26,945,564 | 185,933,821 |
Wecast Services | Crude oil | ||
Disaggregation of Revenue [Line Items] | ||
Total | 0 | 178,178,605 |
Wecast Services | Consumer electronics | ||
Disaggregation of Revenue [Line Items] | ||
Total | 0 | 7,613,113 |
Wecast Services | Digital asset management services | ||
Disaggregation of Revenue [Line Items] | ||
Total | 26,600,000 | 0 |
Wecast Services | Digital advertising services and other | ||
Disaggregation of Revenue [Line Items] | ||
Total | 345,564 | 142,103 |
Legacy YOD | ||
Disaggregation of Revenue [Line Items] | ||
Total | $ 0 | $ 0 |
Revenue (Detail Textuals)
Revenue (Detail Textuals) | Mar. 14, 2019USD ($)Token | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) |
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 26,945,564 | $ 185,933,821 | |
Deferred revenue | 14,100,000 | ||
Development service | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 26,600,000 | ||
GTD | |||
Disaggregation of Revenue [Line Items] | |||
Assets sold under agreements carrying amount | $ 20,400,000 | ||
Number of GTB tokens exchanged for disposal of assets | Token | 1,250,000 | ||
GTD | Digital asset management services | |||
Disaggregation of Revenue [Line Items] | |||
Number of GTB tokens exchanged for disposal of assets | Token | 7,083,333 | ||
Percentage of marketing and business development management services | 0.25% | ||
Assets sold under agreements fair value | $ 40,700,000 | ||
Percentage of discount to fixed contract price | 76.00% | ||
Wecast Services | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 26,945,564 | 185,933,821 | |
Wecast Services | Digital asset management services | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 26,600,000 | 0 | |
Legacy YOD | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 0 | $ 0 |
VIE Structure and Arrangements
VIE Structure and Arrangements (Detail Textuals) ¥ in Millions, $ in Millions | 3 Months Ended | ||
Mar. 31, 2019USD ($)Entity | Mar. 31, 2019CNY (¥) | Dec. 31, 2018USD ($) | |
Variable Interest Entity [Line Items] | |||
Number of variable interest entity | Entity | 2 | ||
VIE | |||
Variable Interest Entity [Line Items] | |||
Assets that settle obligations of VIEs | $ | $ 3.6 | $ 3.5 | |
VIE | Contractual Agreements | YOD Hong Kong | |||
Variable Interest Entity [Line Items] | |||
Registered capital | $ 5.7 | ¥ 38.2 |
Acquisitions (Detail Textuals)
Acquisitions (Detail Textuals) - USD ($) | Mar. 05, 2019 | Feb. 19, 2019 | Mar. 31, 2019 |
Tree Motion Sdn. Bhd. ("Tree Motion") | |||
Business Acquisition [Line Items] | |||
Acquisition percentage | 11.22% | ||
Percentage of voting equity interests acquired | 55.50% | ||
Number of shares issued | 12,190,000 | ||
Amount of shares issued | $ 620,000 | ||
Investment deposit | $ 620,000 | ||
Tree Motion Sdn. Bhd. ("Tree Motion") | MALAYSIA | |||
Business Acquisition [Line Items] | |||
Acquisition percentage | 51.00% | ||
Number of shares issued | 25,500,000 | ||
Shares issued, price per share (in dollars per share) | $ 2 | ||
SolidOpinion, Inc ("SolidOpinion") | |||
Business Acquisition [Line Items] | |||
Number of common stock ("Escrow Shares") held in escrow | 450,000 | ||
Amount received on share issued | $ 2,500,000 | ||
Number of shares exchange | 4,500,000 |
Property and Equipment, net (De
Property and Equipment, net (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 608,757 | $ 620,634 |
Less: accumulated depreciation | (196,566) | (186,514) |
Property and equipment, net | 15,593,255 | 15,029,427 |
Furniture and office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 345,541 | 357,064 |
Vehicle | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 64,632 | 63,135 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 198,584 | 200,435 |
Construction in progress (Fintech Village) | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 15,181,064 | $ 14,595,307 |
Property and Equipment, net (_2
Property and Equipment, net (Detail Textuals) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Property, Plant and Equipment [Line Items] | ||
Capitalized cost related to the legal and architect costs | $ 586,000 | |
Operating expense | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | $ 16,609 | $ 7,584 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Amortizing Intangible Assets | ||
Gross Carry Amount | $ 7,632,308 | $ 3,278,803 |
Accumulated Amortization | (414,396) | (295,665) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | 7,217,913 | 2,983,138 |
Total intangible assets | ||
Gross Carry Amount | 68,809,028 | 3,466,307 |
Accumulated Amortization | (414,396) | (295,665) |
Impairment Loss | 0 | (134,290) |
Net Balance | $ 68,394,632 | 3,036,352 |
Animation Copyright | ||
Amortizing Intangible Assets | ||
Weight Average Remaining Useful Life (in years) | 0 years | |
Gross Carry Amount | $ 0 | 301,495 |
Accumulated Amortization | 0 | (64,606) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 0 | 236,889 |
Software and licenses | ||
Amortizing Intangible Assets | ||
Weight Average Remaining Useful Life (in years) | 0 years | |
Gross Carry Amount | $ 97,308 | 97,308 |
Accumulated Amortization | (95,648) | (93,251) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 1,660 | 4,057 |
Intellectual property (Note 5 (a)) | ||
Amortizing Intangible Assets | ||
Weight Average Remaining Useful Life (in years) | 4 years 10 months 24 days | |
Gross Carry Amount | $ 4,655,000 | 0 |
Accumulated Amortization | (77,583) | 0 |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 4,577,417 | 0 |
Influencer network | ||
Amortizing Intangible Assets | ||
Weight Average Remaining Useful Life (in years) | 9 years 6 months | |
Gross Carry Amount | $ 1,980,000 | 1,980,000 |
Accumulated Amortization | (115,500) | (66,000) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 1,864,500 | 1,914,000 |
Customer contract | ||
Amortizing Intangible Assets | ||
Weight Average Remaining Useful Life (in years) | 2 years 6 months | |
Gross Carry Amount | $ 500,000 | 500,000 |
Accumulated Amortization | (97,223) | (55,556) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 402,777 | 444,444 |
Trade name | ||
Amortizing Intangible Assets | ||
Weight Average Remaining Useful Life (in years) | 14 years 6 months | |
Gross Carry Amount | $ 110,000 | 110,000 |
Accumulated Amortization | (4,277) | (2,444) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 105,723 | 107,556 |
Technology platform | ||
Amortizing Intangible Assets | ||
Weight Average Remaining Useful Life (in years) | 6 years 6 months | |
Gross Carry Amount | $ 290,000 | 290,000 |
Accumulated Amortization | (24,165) | (13,808) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | 265,835 | 276,192 |
Website name | ||
Indefinite lived intangible assets | ||
Gross Carry Amount | 25,214 | 159,504 |
Accumulated Amortization | 0 | 0 |
Impairment Loss | 0 | (134,290) |
Net Balance | 25,214 | 25,214 |
Patent | ||
Indefinite lived intangible assets | ||
Gross Carry Amount | 28,000 | 28,000 |
Accumulated Amortization | 0 | 0 |
Impairment Loss | 0 | 0 |
Net Balance | 28,000 | 28,000 |
GTB Tokens (Note 13 (b)) | ||
Indefinite lived intangible assets | ||
Gross Carry Amount | 61,123,506 | 0 |
Accumulated Amortization | 0 | 0 |
Impairment Loss | 0 | 0 |
Net Balance | $ 61,123,506 | $ 0 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Details 1) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2019 (excluding the three months ended March 31, 2019) | $ 1,198,499 | |
2020 | 1,344,429 | |
2021 | 1,288,873 | |
2022 | 1,177,762 | |
2023 and thereafter | 2,208,350 | |
Total amortization to be recognized | $ 7,217,913 | $ 2,983,138 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Detail Textuals) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense relating to purchased intangible assets | $ 227,568 | $ 2,621 |
Long-term Investments (Details)
Long-term Investments (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Investments, Debt and Equity Securities [Abstract] | ||
Non-marketable Equity Investment | $ 6,266,880 | $ 9,452,103 |
Equity Method Investment | 16,676,714 | 16,956,506 |
Total | $ 22,943,594 | $ 26,408,609 |
Long-term Investments (Details
Long-term Investments (Details 1) | 1 Months Ended | 3 Months Ended | |||
Oct. 31, 2016USD ($) | Oct. 31, 2016CNY (¥) | Mar. 31, 2019USD ($) | |||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Beginning balance | $ 16,956,506 | ||||
Capital increase | 0 | ||||
Loss on investment | (280,486) | ||||
Impairment loss | 0 | ||||
Foreign currency translation adjustments | 694 | ||||
Ending balance | 16,676,714 | ||||
Wecast Internet | |||||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Beginning balance | [1] | 4,114 | |||
Capital increase | $ 149,750 | ¥ 1,000,000 | 0 | [1] | |
Loss on investment | [1] | (5) | |||
Impairment loss | [1] | 0 | |||
Foreign currency translation adjustments | [1] | 1,930 | |||
Ending balance | [1] | 6,039 | |||
Hua Cheng | |||||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Beginning balance | [2] | 308,666 | |||
Capital increase | [2] | 0 | |||
Loss on investment | [2] | (14,598) | |||
Impairment loss | [2] | 0 | |||
Foreign currency translation adjustments | [2] | (1,236) | |||
Ending balance | [2] | 292,832 | |||
BDCG | |||||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Beginning balance | [3] | 9,800,000 | |||
Capital increase | [3] | 0 | |||
Loss on investment | [3] | 0 | |||
Impairment loss | [3] | 0 | |||
Foreign currency translation adjustments | [3] | 0 | |||
Ending balance | [3] | 9,800,000 | |||
DBOT | |||||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Beginning balance | [4] | 6,843,726 | |||
Capital increase | [4] | 0 | |||
Loss on investment | [4] | (265,883) | |||
Impairment loss | [4] | 0 | |||
Foreign currency translation adjustments | [4] | 0 | |||
Ending balance | [4] | $ 6,577,843 | |||
[1] | Wecast Internet Starting from October 2016, we have 50% interest in Wecast Internet Limited ("Wecast Internet") and initial investment was invested RMB 1,000,000 (approximately $149,750). Wecast Internet is in the process of liquidation and the remaining carrying value is immaterial. | ||||
[2] | Hua Cheng Hu Dong (Beijing) Film and Television Communication Co., Ltd.("Hua Cheng") The Company held 39% equity ownership in Hua Cheng, a company established to provide integrated value-added service solutions for the delivery of VOD and enhanced content for cable providers. | ||||
[3] | BBD Digital Capital Group Ltd. ("BDCG") In 2018, we signed a joint venture agreement with two unrelated parties, to establish BDCG located in the United States for providing block chain services for financial or energy industries by utilizing AI and big data technology in the United States. On April 24, 2018, the Company acquired 20% equity ownership in BDCG from one noncontrolling party with cash consideration of a total consideration of $9.8 million which consists of $2 million in cash and $7.8 million paid in the form of the Company's capital stock (valued at $2.60 per share and equal to 3 million shares of the Company's common stock), increasing the Company's ownership to 60%. The remaining 40% of BDCG are held by Seasail ventures limited ("Seasail"). The accounting treatment of the joint venture is based on the equity method due to variable substantive participanting rights (in accordance with ASC 810-10-25-11) granted to Seasail. The new entity is currently in the process of ramping up its operations. | ||||
[4] | Delaware Board of Trade Holdings, Inc. ("DBOT") The Company held 36.92% equity ownership in DBOT. DBOT is an approved and licensed FINRA- and SEC-regulated electronic trading platform with operations in Delaware. One of our subsidiaries is powered by DBOT's platform, trading system and technology. |
Long-term Investments (Detail T
Long-term Investments (Detail Textuals) | 1 Months Ended | 3 Months Ended | ||||||
Apr. 30, 2019$ / sharesshares | Apr. 24, 2018USD ($)$ / sharesshares | Oct. 31, 2016USD ($) | Oct. 31, 2016CNY (¥) | Mar. 31, 2019USD ($)Unrelatedpartyshares | Dec. 31, 2018USD ($) | |||
Debt Instrument [Line Items] | ||||||||
Non marketable equity investment | $ 6,266,880 | $ 9,452,103 | ||||||
Long-term investments | 22,943,594 | $ 26,408,609 | ||||||
Capital decrease in long term investment | $ 0 | |||||||
Common Stock | ||||||||
Debt Instrument [Line Items] | ||||||||
Common stock issuance for acquisition (SolidOpinion, Inc) (in shares) | shares | 4,500,000 | |||||||
DBOT | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of equity ownership | 36.92% | |||||||
Seasail Ventures Limited [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of equity ownership | 40.00% | |||||||
Securities purchase agreement | DBOT | Subsequent Event | ||||||||
Debt Instrument [Line Items] | ||||||||
Number of additional shares acquired | shares | 4,427,870 | |||||||
Common stock, price per share | $ / shares | $ 2.11 | |||||||
BDCG | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of equity ownership | 20.00% | 60.00% | ||||||
Number of unrelated party | Unrelatedparty | 2 | |||||||
Total cash consideration paid | $ 9,800,000 | |||||||
Cash paid to acquire entity | 2,000,000 | |||||||
Value of capital stock issued | $ 7,800,000 | |||||||
Number of common stock ("Escrow Shares") held in escrow | shares | 3,000,000 | |||||||
Share price of capital stock issued | $ / shares | $ 2.60 | |||||||
Wecast Internet Limited ("Wecast Internet") | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of equity ownership | 50.00% | 50.00% | ||||||
Capital decrease in long term investment | $ 149,750 | ¥ 1,000,000 | $ 0 | [1] | ||||
Hua Cheng | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of equity ownership | 39.00% | |||||||
Capital decrease in long term investment | [2] | $ 0 | ||||||
Shandong Media | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of equity ownership | 30.00% | |||||||
Capital decrease in long term investment | $ 0 | |||||||
[1] | Wecast Internet Starting from October 2016, we have 50% interest in Wecast Internet Limited ("Wecast Internet") and initial investment was invested RMB 1,000,000 (approximately $149,750). Wecast Internet is in the process of liquidation and the remaining carrying value is immaterial. | |||||||
[2] | Hua Cheng Hu Dong (Beijing) Film and Television Communication Co., Ltd.("Hua Cheng") The Company held 39% equity ownership in Hua Cheng, a company established to provide integrated value-added service solutions for the delivery of VOD and enhanced content for cable providers. |
Leases (Details)
Leases (Details) | Mar. 31, 2019USD ($) |
Leases [Abstract] | |
2019 | $ 1,320,442 |
2020 | 1,177,261 |
2021 | 1,202,496 |
2022 | 1,294,781 |
2023 | 1,343,668 |
After 2024 | 2,529,735 |
Total lease payments | 8,868,383 |
Less: Interest | (1,824,219) |
Total | $ 7,044,164 |
Leases (Detail Textuals)
Leases (Detail Textuals) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disclosure Of Lease [Line Items] | ||
Leases initial term | 12 months | |
Operating right of use assets | $ 6,802,721 | |
Operating lease liability | 7,044,164 | |
Operating lease expenses | $ 428,000 | $ 216,000 |
Weighted-average remaining lease term | 3 years 9 months 18 days | |
Average discount rate | 7.25% |
Supplementary Information (Deta
Supplementary Information (Detail Textuals) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Supplementary Information [Line Items] | ||
Other Assets, Current | $ 3,799,358 | $ 3,594,942 |
Other Liabilities, Current | $ 5,510,856 | 5,321,697 |
Description of other current liabilities component | more than 5 percent | |
Other payable to third party | $ 4,800,000 | 4,600,000 |
CHINA | ||
Supplementary Information [Line Items] | ||
Description of other current assets component | More than 5 percent | |
Other receivable from third party | $ 3,500,000 | $ 3,300,000 |
Convertible Note (Details)
Convertible Note (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Short-term Debt [Line Items] | ||
Convertible note | $ 16,324,345 | $ 15,453,825 |
Short-term Note | 4,312,561 | 4,140,055 |
Long-term Note | 12,011,784 | 11,313,770 |
Convertible Note | SSSIG | ||
Short-term Debt [Line Items] | ||
Convertible note | 1,142,917 | 1,000,000 |
Convertible Note | Advantech | ||
Short-term Debt [Line Items] | ||
Convertible note | 11,664,914 | 11,313,770 |
Convertible Note | Mr.McMahon | ||
Short-term Debt [Line Items] | ||
Convertible note | 3,169,644 | 3,140,055 |
Senior Secured Convertible Note | ||
Short-term Debt [Line Items] | ||
Convertible note | $ 346,870 | $ 0 |
Convertible Note (Detail Textua
Convertible Note (Detail Textuals) | 1 Months Ended | 3 Months Ended | |||
Feb. 22, 2019USD ($)Percent$ / sharesshares | Jun. 28, 2018USD ($)$ / sharesshares | Mar. 31, 2019USD ($)$ / sharesshares | Mar. 31, 2018USD ($) | Apr. 24, 2018$ / shares | |
Debt Instrument [Line Items] | |||||
Exercise price of warrants | $ / shares | $ 1.84 | $ 5.375 | |||
Unamortized discount convertible note | $ 1,724,000 | ||||
Interest expense relating to discount | 326,000 | ||||
Security purchase agreement with ID Venturas 7, LLC ("IDV") | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 10.00% | ||||
Common stock issued from conversion of convertible note | shares | 1,114,130 | ||||
Conversion price | $ / shares | $ 1.84 | ||||
Amount of beneficial conversion feature | $ 600,000 | ||||
Maturity date of the note | Aug. 22, 2020 | ||||
Senior secured convertible note | $ 2,050,000 | ||||
Number of shares issued | shares | 1,166,113 | ||||
Exercise price of warrants | $ / shares | $ 1.84 | ||||
Number of common stock convertible | shares | 1,671,196 | ||||
Warrant expiry period | 5 years | ||||
Percentage of warrant exercisable | 150.00% | ||||
Proceeds from convertible debt | $ 2,000,000 | ||||
Convertible note issuance expenses | $ 50,000 | ||||
Security purchase agreement with Grapevine | |||||
Debt Instrument [Line Items] | |||||
Carrying amount of convertible note | $ 2,600,000 | ||||
Number of additional shares issued | shares | 250,000 | ||||
Expected life | Security purchase agreement with ID Venturas 7, LLC ("IDV") | |||||
Debt Instrument [Line Items] | |||||
Warrant, Term | 5 years | ||||
Expected dividend rate | Security purchase agreement with ID Venturas 7, LLC ("IDV") | |||||
Debt Instrument [Line Items] | |||||
Warrants and rights outstanding, Measurement Input | Percent | 0 | ||||
Volatility | Security purchase agreement with ID Venturas 7, LLC ("IDV") | |||||
Debt Instrument [Line Items] | |||||
Warrants and rights outstanding, Measurement Input | Percent | 111.83 | ||||
Interest rate | Security purchase agreement with ID Venturas 7, LLC ("IDV") | |||||
Debt Instrument [Line Items] | |||||
Warrants and rights outstanding, Measurement Input | Percent | 2.48 | ||||
Advantech Capital Investment II Limited | Common Stock Purchase Agreement | |||||
Debt Instrument [Line Items] | |||||
Common stock issuance (GTD) | $ 12,000,000 | ||||
Interest rate | 8.00% | ||||
Common stock issued from conversion of convertible note | shares | 6,593,406 | ||||
Conversion price | $ / shares | $ 1.82 | ||||
Amount of beneficial conversion feature | $ 1,400,000 | ||||
Maturity date of the note | Jun. 28, 2021 | ||||
Interest expense recognized to beneficial conversion feature | $ 114,000 | $ 0 |
Stockholders' Equity (Detail Te
Stockholders' Equity (Detail Textuals) - $ / shares | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Stockholders Equity [Line Items] | ||
Common stock, shares authorized | 1,500,000,000 | 1,500,000,000 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Convertible preferred stock | ||
Stockholders Equity [Line Items] | ||
Preferred stock, shares authorized | 50,000,000 | |
Preferred stock, par value (in dollars per share) | $ 0.001 | |
Series A preferred stock | ||
Stockholders Equity [Line Items] | ||
Preferred stock, shares issued | 7,000,000 | 7,000,000 |
Preferred stock, shares outstanding | 7,000,000 | 7,000,000 |
Number of common stock issued for conversion | 933,333 | |
Preferred stock, voting rights | ten vote | |
Liquidation preference value, per share | $ 0.50 |
Related Party Transactions (Det
Related Party Transactions (Detail Textuals) - USD ($) | Feb. 08, 2019 | May 10, 2012 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | |||||
Amount due to related parties | $ 1,028,253 | $ 800,822 | |||
Interest expenses related to note | 29,589 | $ 30,000 | |||
Interest payable | 169,644 | $ 140,055 | |||
$3.0 Million Convertible Note | SSSIG | |||||
Related Party Transaction [Line Items] | |||||
Principal amount of convertible note | 1,400,000 | ||||
$2.5 Million Convertible Promissory Note | SSSIG | |||||
Related Party Transaction [Line Items] | |||||
Interest expenses related to note | 10,617 | ||||
Advance received without any interest | 1,100,000 | ||||
Convertible convertible promissory note amount not received | $ 1,400,000 | ||||
Mr. Shane McMahon | $3.0 Million Convertible Note | |||||
Related Party Transaction [Line Items] | |||||
Amount due to related parties | $ 3,000,000 | ||||
Principal amount of convertible note | $ 3,000,000 | ||||
Interest rate of convertible note | 4.00% | ||||
Conversion price of note convertible | $ 1.75 | $ 1.5 | |||
Conversion price of convertible note after amendment | $ 1.50 | ||||
Maturity date of the note | Dec. 31, 2019 | ||||
Bruno Wu ("Mr.Wu") | $2.5 Million Convertible Promissory Note | SSSIG | |||||
Related Party Transaction [Line Items] | |||||
Principal amount of convertible note | $ 2,500,000 | ||||
Interest rate of convertible note | 4.00% | ||||
Conversion price of note convertible | $ 1.83 | ||||
Maturity date of the note | Feb. 8, 2020 |
Related Party Transactions (D_2
Related Party Transactions (Detail Textuals 1) | 1 Months Ended | 3 Months Ended | ||
Feb. 20, 2019USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Mar. 14, 2019USD ($)Token | |
Related Party Transaction [Line Items] | ||||
Purchase of crude oil, commitment amount | $ 162,300,000 | |||
Salary, severance and expenses | $ 837,000 | $ 637,000 | ||
Due to other related parties | 200,000 | |||
GTD | ||||
Related Party Transaction [Line Items] | ||||
Assets sold under agreements carrying amount | $ 20,400,000 | |||
Number of GTB tokens exchanged for disposal of assets | Token | 1,250,000 | |||
GTD | Digital asset management services | ||||
Related Party Transaction [Line Items] | ||||
Number of GTB tokens exchanged for disposal of assets | Token | 7,083,333 | |||
GTD | License content | ||||
Related Party Transaction [Line Items] | ||||
Assets sold under agreements carrying amount | 17,000,000 | |||
GTD | Nanjing Shengyi Network Technology Co., Ltd | ||||
Related Party Transaction [Line Items] | ||||
Assets sold under agreements carrying amount | $ 3,200,000 |
Share-Based Payments (Details)
Share-Based Payments (Details) - Stock Options - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Options Outstanding | ||
Outstanding at January 1, 2019 | 1,706,431 | |
Granted | 0 | |
Exercised | 0 | |
Expired | 0 | |
Forfeited | (60,000) | |
Outstanding at March 31, 2019 | 1,646,431 | 1,706,431 |
Vested and expected to be vested as of March 31, 2019 | 1,646,431 | |
Options exercisable at March 31, 2019 (vested) | 1,634,348 | |
Weighted Average Exercise Price | ||
Outstanding at January 1, 2019 | $ 3.28 | |
Granted | 0 | |
Exercised | 0 | |
Expired | 0 | |
Forfeited | 1.91 | |
Outstanding at March 31, 2019 | 3.33 | $ 3.28 |
Vested and expected to be vested as of March 31, 2019 | 3.33 | |
Options exercisable at March 31, 2019 (vested) | $ 3.34 | |
Weighted Average Remaining Contractual Life (Years) | ||
Outstanding at March 31, 2019 | 3 years 7 months 28 days | |
Vested and expected to be vested as of March 31, 2019 | 3 years 7 months 28 days | |
Options exercisable at March 31, 2019 (vested) | 3 years 7 months 17 days | 4 years 29 days |
Aggregated Intrinsic Value | ||
Outstanding at March 31, 2019 | $ 54,565 | $ 0 |
Vested and expected to be vested as of March 31, 2019 | 54,565 | |
Options exercisable at March 31, 2019 (vested) | $ 53,565 |
Share-Based Payments (Details 1
Share-Based Payments (Details 1) - $ / shares | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | Apr. 24, 2018 | |
Class of Warrant or Right [Line Items] | |||
Number of Warrants Outstanding and Exercisable | 1,671,196 | 60,000 | 8,000,000 |
Exercise price of warrants | $ 1.84 | $ 5.375 | |
2014 Broker Warrants (Series E Financing) | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants Outstanding and Exercisable | 0 | 60,000 | |
Exercise price of warrants | $ 1.75 | $ 1.75 | |
Expiration Date | Jan. 31, 2019 | Jan. 31, 2019 | |
2018 IDV (Senior secured convertible note ) | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants Outstanding and Exercisable | 1,671,196 | 0 | |
Exercise price of warrants | $ 1.84 | $ 1.84 | |
Expiration Date | Feb. 2, 2022 | Feb. 22, 2024 |
Share-Based Payments (Details 2
Share-Based Payments (Details 2) - Restricted Stock | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
Shares | |
Non-vested restricted shares outstanding at January 1, 2019 | shares | 87,586 |
Granted | shares | 129,840 |
Forfeited | shares | 0 |
Vested | shares | (129,840) |
Non-vested restricted shares outstanding at March 31, 2019 | shares | 87,586 |
Weighted-average fair value | |
Non-vested restricted shares outstanding at January 1, 2019 | $ / shares | $ 2.46 |
Granted | $ / shares | 1.24 |
Forfeited | $ / shares | 0 |
Vested | $ / shares | 1.24 |
Non-vested restricted shares outstanding at March 31, 2019 | $ / shares | $ 2.46 |
Share-Based Payments (Detail Te
Share-Based Payments (Detail Textuals) | 1 Months Ended | 3 Months Ended | |||
Jan. 31, 2019USD ($)Directorshares | Apr. 24, 2018$ / sharesshares | Mar. 31, 2019USD ($)$ / sharesshares | Mar. 31, 2018USD ($) | Dec. 31, 2018shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Warrants outstanding to purchase shares of common stock | 8,000,000 | 1,671,196 | 60,000 | ||
Share-based payments expense | $ | $ 224,000 | $ 121,000 | |||
Unrecognized compensation expense related to non-vested share options | $ | 12,448 | ||||
Total fair value of vested shares | $ | $ 6,312 | 312,688 | |||
Weighted average exercise price of warrants | $ / shares | $ 5.375 | $ 1.84 | |||
Weighted average remaining life of warrants | 5 years | ||||
Cash received from options exercised | $ | $ 0 | $ 2,632 | |||
Percentage of premium on exercise price | 25.00% | ||||
Closing market price | $ / shares | $ 4.30 | ||||
Weighted average period for recognition related to non-vested restricted shares | 7 months 10 days | ||||
2010 Stock Incentive Plan ("the Plan") | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized for issuance | 31,500,000 | ||||
Number of options available for issuance | 27,575,499 | ||||
Board of Directors | 2010 Stock Incentive Plan ("the Plan") | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted shares granted | 129,840 | ||||
Amount of grant date fair value of the restricted shares | $ | $ 161,001 | ||||
Number of directors | Director | 2 | ||||
Restricted Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options outstanding to purchase shares of common stock | 87,586 | ||||
Number of restricted shares to purchase shares of common stock | 87,586 | 87,586 | |||
Restricted shares granted | 129,840 | ||||
Restricted shares vested | 129,840 | ||||
Unrecognized compensation cost related to unvested restricted shares | $ | $ 106,600 | ||||
Weighted average period for recognition related to non-vested restricted shares | 1 year 4 days | ||||
Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options outstanding to purchase shares of common stock | 1,646,431 | 1,706,431 | |||
Stock options issued to employees | 0 |
Earnings (Loss) Per Common Sh_3
Earnings (Loss) Per Common Share (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Net earning (loss) per share | ||
Net earnings (loss) attributable to common stockholders | $ 19,926,515 | $ (3,721,369) |
Interest expense attributable to convertible promissory notes | 738,219 | |
Net earnings (loss) assuming dilution | $ 20,664,734 | $ (3,721,369) |
Basic weighted average common shares outstanding | 105,345,673 | 68,816,303 |
Effect of dilutive securities | ||
Convertible preferred shares- Series A | 933,333 | 0 |
Convertible promissory notes | 10,022,230 | 0 |
Diluted potential common shares | 116,301,236 | 68,816,303 |
Net earnings (loss) per share: | ||
Basic | $ 0.19 | $ (0.05) |
Diluted | $ 0.18 | $ (0.05) |
Earnings (Loss) Per Common Sh_4
Earnings (Loss) Per Common Share (Details 1) - shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 3,317,627 | 13,106,997 |
Warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 1,671,196 | 60,000 |
Options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 1,646,431 | 1,706,431 |
Series A preferred stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 0 | 933,333 |
Convertible promissory note and interest | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 0 | 10,407,233 |
Income Taxes (Detail Textuals)
Income Taxes (Detail Textuals) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Income Tax Disclosure [Abstract] | |
Income tax benefit | $ (86,405) |
Income tax expense related to current operations | 4,750,449 |
Benefit from reduction in deferred tax valuation allowance | $ 4,836,854 |
Effective income tax rate | 1.00% |
Concentration, Credit and Oth_3
Concentration, Credit and Other Risks (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Revenue, Major Customer [Line Items] | ||
Total | $ 2,011,898 | $ 3,106,244 |
RMB denominated bank deposits | PRC | ||
Revenue, Major Customer [Line Items] | ||
Total | 483,829 | 1,523,622 |
U.S dollar denominated bank deposits | PRC | ||
Revenue, Major Customer [Line Items] | ||
Total | 24,436 | 133,053 |
U.S dollar denominated bank deposits | Hong Kong Special Administrative Region (HKSAR) | ||
Revenue, Major Customer [Line Items] | ||
Total | 35,381 | 44,182 |
U.S dollar denominated bank deposits | Singapore (Singapore) | ||
Revenue, Major Customer [Line Items] | ||
Total | 687,151 | 697,099 |
U.S dollar denominated bank deposits | The United States of America (USA) | ||
Revenue, Major Customer [Line Items] | ||
Total | 780,886 | 695,155 |
HKD denominated bank deposits | Hong Kong Special Administrative Region (HKSAR) | ||
Revenue, Major Customer [Line Items] | ||
Total | $ 215 | $ 13,133 |
Concentration, Credit and Oth_4
Concentration, Credit and Other Risks (Detail Textuals) - Major Customers - Wecast Services - Customer | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenue | ||
Revenue, Major Customer [Line Items] | ||
Description of percentage of revenue for major customer | more than 10 | more than 10 |
Number of customers | 1 | 1 |
Accounts receivables | ||
Revenue, Major Customer [Line Items] | ||
Description of percentage of revenue for major customer | more than 10 | more than 10 |
Number of customers | 2 | 2 |
Concentration, Credit and Oth_5
Concentration, Credit and Other Risks (Detail Textuals 1) | 3 Months Ended | |
Mar. 31, 2019TokenSupplier | Mar. 31, 2018Supplier | |
Revenue, Major Customer [Line Items] | ||
Number of GTB tokens held | Token | 8,333,333 | |
Major Suppliers | Cost of revenues | ||
Revenue, Major Customer [Line Items] | ||
Description of percentage of revenue for major supplier | more than 10 | |
Number of suppliers | 1 | |
Major Suppliers | Accounts payable | ||
Revenue, Major Customer [Line Items] | ||
Description of percentage of revenue for major supplier | more than 10 | more than 10 |
Number of suppliers | 2 | 1 |
Defined Contribution Plan (Deta
Defined Contribution Plan (Detail Textuals) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Defined Contribution Plan Disclosure [Line Items] | ||
Employer matching contribution, percent | 100.00% | |
Employer matching contribution, description | 401(k) defined contribution plan ("401(k) Plan") that provides for a 100% employer matching contribution of the first 3% and a 50% employer matching contribution of each additional percent contributed by an employee up to 5% of each employee's pay. Employees become fully vested in employer matching contributions after six months of employment. | |
Employer matching contribution, amount | $ 0 | $ 14,486 |
PRC | ||
Defined Contribution Plan Disclosure [Line Items] | ||
Employer matching contribution, amount | $ 77,199 | $ 211,704 |
Segments and Geographic Areas_2
Segments and Geographic Areas (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
NET SALES TO EXTERNAL CUSTOMERS | |||
Net sales | $ 26,945,564 | $ 185,933,821 | |
Cost of Sales | |||
Cost of Sales | 257,406 | 23,280,931 | |
GROSS PROFIT | |||
Gross profit | 26,688,158 | 393,136 | |
TOTAL ASSETS | |||
Assets | 146,222,238 | $ 94,235,112 | |
Operating Segments | |||
NET SALES TO EXTERNAL CUSTOMERS | |||
Net sales | 26,945,564 | 185,933,821 | |
GROSS PROFIT | |||
Gross profit | 26,688,158 | 393,136 | |
TOTAL ASSETS | |||
Assets | 147,355,800 | 94,395,122 | |
Legacy YOD | |||
NET SALES TO EXTERNAL CUSTOMERS | |||
Net sales | 0 | 0 | |
Legacy YOD | Operating Segments | |||
NET SALES TO EXTERNAL CUSTOMERS | |||
Net sales | 0 | 0 | |
Cost of Sales | |||
Cost of Sales | 0 | 0 | |
TOTAL ASSETS | |||
Assets | 10,578,437 | 26,442,810 | |
Wecast Services | |||
NET SALES TO EXTERNAL CUSTOMERS | |||
Net sales | 26,945,564 | 185,933,821 | |
Wecast Services | Operating Segments | |||
NET SALES TO EXTERNAL CUSTOMERS | |||
Net sales | 26,945,564 | 185,933,821 | |
Cost of Sales | |||
Cost of Sales | 257,406 | $ 185,540,685 | |
TOTAL ASSETS | |||
Assets | 135,643,801 | 51,592,929 | |
Unallocated | Operating Segments | |||
TOTAL ASSETS | |||
Assets | $ 0 | $ 16,359,383 |
Segments and Geographic Areas_3
Segments and Geographic Areas (Detail Textuals) | 3 Months Ended |
Mar. 31, 2019Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 2 |
Going Concern and Management'_2
Going Concern and Management's Plans (Detail Textuals) | Mar. 31, 2019USD ($)Token | Dec. 31, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Going Concern And Managements Plans [Line Items] | ||||
Cash and cash equivalents | $ 2,011,898 | $ 3,106,244 | $ 4,243,960 | $ 7,577,317 |
Number of GTB tokens held | Token | 8,333,333 | |||
Convertible Note | SSSIG | ||||
Going Concern And Managements Plans [Line Items] | ||||
Principal amount of convertible note | $ 1,400,000 |