AI Financial Corp Segments Disclosure

Note 22: Segment information

 

ALT5 Sigma Inc. is a fintech company providing regulated, institutional-grade Crypto-as-a-Service (CaaS) infrastructure for the digital asset economy. In accordance with ASC 280, Segment Reporting, the Company has identified two reportable segments: Fintech and Biotech. This segmentation aligns with how the Chief Operating Decision Maker (“CODM”), consisting of the Company’s Chief Executive Officer and Chief Financial Officer, assesses financial performance and allocates resources across the Company’s operations.

 

 

ALT5 SIGMA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

To preserve the integrity of each operating segment’s standalone financial results, all intercompany eliminations, including sales, cost of goods sold, inventory profit, and intercompany management fees are reported under Intercompany Eliminations. Total assets are not utilized by the CODM in evaluating segment performance or allocating resources. Accordingly, asset information is excluded from the Company’s segment reporting disclosures. Discrete financial information is provided for each reportable segment, including comparisons of actual results to the prior period and current period forecast.

 

The following is description of each of the Company’s reportable segments:

 

●

The Fintech segment, which provides next generation blockchain-powered technologies for tokenization, trading, clearing, settlement, payment, and safe-keeping of digital assets.

 

●

The Biotech segment focuses on developing treatments for conditions that cause severe pain and on bringing to market drugs with non-addictive pain-relieving properties. The Company has previously announced its intention to capitalize a subsidiary with certain of its biotechnology assets, acquire an additional biotechnology asset, and subsequently finance that subsidiary. The short-term objective of this series of transactions is to separate the business so it can operate on a stand-alone basis. Consequently, the Biotech segment is presented as discontinued operations.

 

This segmentation aligns with the internal reporting structure used by the CODM to evaluate performance and guide strategic decision-making. The CODM does not review any measures of significant segment expenses beyond those reflected in the tables below:

 Schedule of Segment Information

For the Fiscal Year Ended December 27, 2025		Fintech				Biotech (Discontinued Operations)				Total Reportable Segments				Corporate and Other				Total
Revenue		$	24,840			$	—			$	24,840			$	—			$	24,840
Cost of revenue			14,652				—				14,652				—				14,652
Gross profit			10,188				—				10,188				—				10,188
Gross profit percentage			41.0	%			N/A				41.0	%							41.0	%
Operating expenses:
General and administrative expenses			16,370				3,898				20,268				16,669				36,937
Total operating expenses			16,370				3,898				20,268				16,669				36,937
Operating income			(6,182	)			(3,898	)			(10,080	)			(16,669	)		$	(26,749	)
Other income (expense):
Interest expense, net			(2,754	)			—				(2,754	)			(1,114	)			(3,868	)
Unrealized loss on cryptocurrency assets			—				—				—				(402,054	)			(402,054	)
Unrealized gain on exchange transactions			768				—				768				—				768
Realized gain on exchange transactions			374								374								374
Other income, net			(516	)			—				(516	)			(81	)			(597	)
Total income (expense), net			(2,128	)			—				(2,128	)			(403,249	)			(405,377	)
Income (loss) before income taxes		$	(8,310	)		$	(3,898	)		$	(12,208	)		$	(419,918	)		$	(432,126	)

 

 

ALT5 SIGMA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

For the Fiscal Year Ended December 28, 2024		Fintech				Biotech (Discontinued Operations)				Total Reportable Segments				Corporate and Other				Total
Revenue		$	11,887			$	—			$	11,887			$	—			$	11,887
Cost of revenue			6,238				—				6,238				—				6,238
Gross profit			5,649				—				5,649				—				5,649
Gross profit percentage			47.5	%			N/A				47.5	%							47.5	%
Operating expenses:
General and administrative expenses			5,456				2,148				7,604				7,116				14,720
Total operating expenses			5,456				2,148				7,604				7,116				14,720
Operating income			193				(2,148	)			(1,955	)			(7,116	)		$	(9,071	)
Other income (expense):
Interest expense, net			(779	)			—				(779	)			(380	)			(1,159	)
Unrealized loss on marketable securities			—				—				—				(1,238	)			(1,238	)
Realized gain on exchange transactions			1,019				—				1,019				—				1,019
Other income, net			390				—				390				(550	)			(160	)
Total income (expense), net			630				—				630				(2,168	)			(1,538	)
Income (loss) before income taxes		$	823			$	(2,148	)		$	(1,325	)		$	(9,284	)		$	(10,609	)