The accompanying unaudited condensed consolidated financial statements have been
prepared on a going concern basis, which contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business. As of
The Company will require additional funding to grow its operations. Further,
depending upon operational profitability, the Company may also need to raise
additional funding for ongoing working capital purposes. There can be no
assurance however that the Company will be able to raise additional capital when
needed, or at terms deemed acceptable, if at all. The Company's ability to raise
additional capital is impacted by the volatility of Bitcoin mining economics and
the
Since
Such factors raise substantial doubt about the Company's ability to sustain operations for at least one year from the issuance of these unaudited condensed consolidated financial statements. The accompanying unaudited condensed consolidated financial statements do not include any adjustments related to the recoverability and classification of asset amounts or the classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
Note 3. Summary of Significant Accounting Policies
Principles of consolidation
The unaudited condensed consolidated financial statements include the accounts
of
6
Use of estimates and assumptions and critical accounting estimates and assumptions
The preparation of financial statements in conformity with
Revenue recognition
The Company's primary revenue stream is related to the mining of digital currencies. The Company derives its revenue by solving "blocks" to be added to the blockchain and providing transaction verification services within the digital currency network of Bitcoin, commonly termed "cryptocurrency mining." In consideration for these services, the Company receives digital currency ("Coins"). The Coins are recorded as revenue, using the average spot price of Bitcoin on the date of receipt. The Coins are recorded on the balance sheet as an intangible digital asset valued at the lower of cost or net realizable value. Net realizable value adjustments, to adjust the value of Coins to market value, are included in cost of revenue on the Company's consolidated statement of operations. Further, any gain or loss on the sale of Coins would be recorded to costs of revenue. Costs of revenue include electricity costs, equipment and infrastructure depreciation, and net realizable value adjustments.
The Company also recognizes a royalty participation upon the sale of certain
containers manufactured by
Property and Equipment
Property and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method on the various asset classes over their estimated useful lives, which range from one to ten years when placed in service. The cost of repairs and maintenance is expensed as incurred; major replacements and improvements are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income in the year of disposition. Deposits on property and equipment are initially classified as Other Assets and upon delivery, installation and full payment, the assets are classified as property and equipment on the consolidated balance sheet.
Income taxes
The Company accounts for income taxes in accordance with ASC 740, "Income Taxes". ASC 740 requires an asset and liability approach for financial accounting and reporting for income taxes and established for all the entities a minimum threshold for financial statement recognition of the benefit of tax positions and requires certain expanded disclosures. The provision for income taxes is based upon income or loss after adjustment for those permanent items that are not considered in the determination of taxable income. Deferred income taxes represent the tax effects of differences between the financial reporting and tax basis of the Company's assets and liabilities at the enacted tax rates in effect for the years in which the differences are expected to reverse. The Company evaluates the recoverability of deferred tax assets and establishes a valuation allowance when it is more likely than not that some portion or all the deferred tax assets will not be realized. Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In management's opinion, adequate provisions for income taxes have been made. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary.
7 Loss per share
Basic loss per share is calculated by dividing net loss applicable to common shareholders by the weighted average number of common shares outstanding during the period. Diluted loss per share is calculated by dividing the net loss attributable to common shareholders by the sum of the weighted average number of common shares outstanding plus potential dilutive common shares outstanding during the period. Potential dilutive securities, comprised of unvested restricted shares, convertible debt, convertible preferred stock, stock warrants and stock options, are not reflected in diluted net loss per share because such potential shares are anti-dilutive due to the Company's net loss.
Accordingly, the computation of diluted loss per share for the six months ended
Stock-based compensation
The Company applies ASC 718-10, "Share-Based Payment," which requires the measurement and recognition of compensation expenses for all share-based payment awards made to employees and directors including employee stock options under the Company's stock plans and equity awards issued to non-employees based on estimated fair values.
ASC 718-10 requires companies to estimate the fair value of equity-based option awards on the date of grant using an option-pricing model. The fair value of the award is recognized as an expense on a straight-line basis over the requisite service periods in the Company's consolidated statements of comprehensive loss.
Restricted stock awards are granted at the discretion of the compensation committee of the board of directors of the Company (the "Board of Directors"). These awards are restricted as to the transfer of ownership and generally vest over the requisite service periods, typically over a 12 to 24-month period (vesting on a straight-line basis). The fair value of a stock award is equal to the fair market value of a share of the Company's common stock on the grant date.
The fair value of an option award is estimated on the date of grant using the Black-Scholes option valuation model. The Black-Scholes option valuation model requires the development of assumptions that are inputs into the model. These assumptions are the expected stock volatility, the risk-free interest rate, the expected life of the option, the dividend yield on the underlying stock and the expected forfeiture rate. Expected volatility is calculated based on the historical volatility of the Company's common stock over the expected term of the option. Risk-free interest rates are calculated based on continuously compounded risk-free rates for the appropriate term.
Determining the appropriate fair value model and calculating the fair value of equity-based payment awards require the input of the subjective assumptions described above. The assumptions used in calculating the fair value of equity-based payment awards represent management's best estimates, which involve inherent uncertainties and the application of management's judgment. The Company is required to estimate the expected forfeiture rate and recognize expense only for those shares expected to vest.
Fair Value Measure and Disclosures
ASC 820 "Fair Value Measurements and Disclosures" provides the framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).
8
Fair value is defined as an exit price, representing the amount that would be received upon the sale of an asset or payment to transfer a liability in an orderly transaction between market participants. Fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. A three-tier fair value hierarchy is used to prioritize the inputs in measuring fair value as follows:
? Level 1 Quoted prices in active markets for identical assets or liabilities. ? Level 2 Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable, either directly or indirectly. ? Level 3 Significant unobservable inputs that cannot be corroborated by market data.
As of
Gain (Loss) on Modification/Extinguishment of Debt
In accordance with ASC 470, a modification or an exchange of debt instruments that adds or eliminates a conversion option that was substantive at the date of the modification or exchange is considered a substantive change and is measured and accounted for as extinguishment of the original instrument along with the recognition of a gain/loss. Additionally, under ASC 470, a substantive modification of a debt instrument is deemed to have been accomplished with debt instruments that are substantially different if the present value of the cash flows under the terms of the new debt instrument is at least 10 percent different from the present value of the remaining cash flows under the terms of the original instrument. A substantive modification is accounted for as an extinguishment of the original instrument along with the recognition of a gain/loss.
Cash and cash equivalents
The Company considers all highly liquid instruments with an original maturity of
three months or less when acquired to be cash equivalents. The Company's
combined accounts were
Recent accounting pronouncements
Management does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying consolidated financial statements, other than those disclosed below.
In
Derivative Instruments
Derivative financial instruments are recorded in the accompanying consolidated balance sheets at fair value in accordance with ASC 815. When the Company enters into a financial instrument such as a debt or equity agreement (the "host contract"), the Company assesses whether the economic characteristics of any embedded features are clearly and closely related to the primary economic characteristics of the remainder of the host contract. When it is determined that (i) an embedded feature possesses economic characteristics that are not clearly and closely related to the primary economic characteristics of the host contract, and (ii) a separate, stand-alone instrument with the same terms would meet the definition of a financial derivative instrument, then the embedded feature is bifurcated from the host contract and accounted for as a derivative instrument. The estimated fair value of the derivative feature is recorded in the accompanying consolidated balance sheets separately from the carrying value of the host contract. Subsequent changes in the estimated fair value of derivatives are recorded as a gain or loss in the Company's consolidated statements of operations.
Impairment of long-lived assets
Long-lived assets are reviewed for impairment whenever facts or circumstances either internally or externally may suggest that the carrying value of an asset may not be recoverable. Should there be an indication of impairment, we test for recoverability by comparing the estimated undiscounted future cash flows expected to result from the use of the asset to the carrying amount of the asset or asset group. Any excess of the carrying value of the asset or asset group over its estimated fair value is recognized as an impairment loss.
9
Management's evaluation of subsequent events
The Company evaluates events that have occurred after the balance sheet date but before the financial statements are issued. Based upon the review, other than what is described in Note 11 - Subsequent Events, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the unaudited condensed consolidated financial statements.
Digital Currencies
Digital currencies are included in current assets in the condensed consolidated balance sheets. Digital currencies are recorded at the lower of cost or net realizable value.
Net realizable value adjustments, to adjust the value of Coins to market value, are included in cost of revenue on the Company's consolidated statement of operations. Further, any gain or loss on the sale of Coins would be recorded to costs of revenue. Costs of revenue include hosting fees, equipment and infrastructure depreciation, net realizable value adjustments, and electricity costs.
Halving - The Bitcoin blockchain and the cryptocurrency reward for solving a
block is subject to periodic incremental halving. Halving is a process designed
to control the overall supply and reduce the risk of inflation in
cryptocurrencies using a Proof-of-Work consensus algorithm. At a predetermined
block, the mining reward is cut in half, hence the term "Halving." A Halving for
bitcoin occurred on
The following table presents the activities of digital currencies for the six
months ended
Schedule of Digital Currencies
Digital currencies at December 31, 2020$ 4 Additions of digital currencies from mining 524
Payment of digital currencies to management partners - Realized gain on sale of digital currencies
(3 ) Net realizable value adjustment (2 ) Sale of digital currencies (523 ) Digital currencies at June 30, 2021 $ -
Note 4. Property, Plant, and Equipment and Other Assets
Property and equipment consisted of the following:
Schedule of Property and Equipment
As of June 30, 2021 December 31, 2020 Land $ 55 $ 57 Computer hardware and software 10 10 Bitcoin mining machines 1,176 1,206 Infrastructure 905 905 Containers 403 550 Leasehold improvements 4 4 Property and equipment, gross 2,553 2,732 Less: Accumulated depreciation (1,191 ) (860 ) Property and equipment, net $ 1,362 $ 1,872
The Company recorded depreciation expense of
10
Other Assets consisted of the following:
Schedule of Other Assets
As of June 30, 2021 December 31, 2020 Security deposits $ 3 $ 123 Other Assets $ 3 $ 123
The Company has paid
Note 5. Notes PayableJune 2018 Note
On
During the year ended
December 2020 Note
On
The Company determined that the embedded conversion feature of the convertible
promissory note meets the definition of a beneficial conversion feature and a
derivative liability which is accounted for separately. The Company measured the
beneficial conversion feature's intrinsic value on
On
As of
11March 2021 Note
On
The
As a result of the Company failing to meet certain registration requirements
under the
The Company determined that the embedded conversion feature of the convertible
promissory note meets the definition of a beneficial conversion feature. The
Company measured the beneficial conversion feature's intrinsic value on
Derivative Liabilities
The Company's activity in its derivative liability was as follows for the six
months ended
Schedule of Derivative Liability Activity
Balance of derivative liability at
(172 )
Change in fair value recognized in non-operating expense 33
Balance of derivative liability at
$ 107
The Company did not have any derivative liability activity during the six months
ended
Fluctuations in the Company's stock price are a primary driver for the changes in the derivative valuations during each reporting period. As the stock price increases for each of the related derivative instruments, the value to the holder of the instrument generally increases, therefore increasing the liability on the Company's balance sheet. Additionally, stock price volatility is one of the significant unobservable inputs used in the fair value measurement of each of the Company's derivative instruments. The simulated fair value of these liabilities is sensitive to changes in the Company's expected volatility. Increases in expected volatility would generally result in higher fair value measurement. A 10% change in pricing inputs and changes in volatilities and correlation factors would not result in a material change in our Level 3 fair value.
The following table summarizes the Company's derivative liability as of
Schedule of Derivative Liability Fair Value
June 30, 2021 Level 1 Level 2 Level 3 Fair Value Liabilities Derivative liability $ - $ -$ 107 $ 107 12 The following table summarizes the Company's derivative liability as ofDecember 31, 2020 : December 31, 2020 Level 1 Level 2 Level 3 Fair Value Liabilities Derivative liability $ - $ -$ 246 $ 246
On
On
Notes payable consisted of the following:
Schedule of Notes Payable
As of June 30, 2021 Principal Discount Net December 2020 Note$ 110 $ (74 ) $ 36 March 2021 Note 1,210 (1,006 ) 204 Total notes payable$ 1,320 $ (1,080 ) $ 240 As of December 31, 2020 Principal Discount Net
Total notes payable-
During the three months ended
During the six months ended
Note 6. Leases
In
13
Total future minimum payments required under the lease agreement are as follows:
Schedule of Future Minimum Lease Payment
Amount Remainder of 2021$ 19 2022 38
Total undiscounted minimum future lease payments
(11 ) Present value of operating lease liabilities$ 46 Disclosed as: Current portion$ 28 Non-current portion 18 Total lease payment$ 46
The Company recorded rent expense of
At
Note 7. Common Stock and Preferred Stock
Common stock Other Common Stock Issuances
In connection with the conversion of 115 shares of Series C Preferred Stock
during the six months ended
In connection with the partial conversion of
Preferred Stock
On
On
14
Each Series C Preferred Share is convertible into shares of the Company's common stock in an amount equal to the greater of: (a) 200,000shares of common stock or (b) the amount derived by dividing the stated value by the product of 0.7 times the market price of the Company's common stock, defined as the lowest trading price of the Company's common stock during the ten-day period preceding the conversion date. The holder may not convert any Series C Preferred Shares if the total amount of shares held, together with holdings of its affiliates, following a conversion exceeds 9.99% of the Company's common stock.
The common shares issued upon conversion of the Series C Preferred Shares have
been registered under the Company's then-effective registration statement on
Form S-3. On
On
Note 8. Stock-Based Compensation
Issuance of restricted common stock - directors, officers and employees
The Company's activity in restricted common stock was as follows for the six
months ended
Schedule of Restricted Common Stock Activity
Weighted average grant date fair Number of shares value Non-vested at December 31, 2020 33,333 $ 0.04 Granted - $ - Vested (33,333 ) $ 0.04 Non-vested at June 30, 2021 - $ -
For the three months ended
For the six months ended
As of
Stock options
Under the terms of the stock option agreement, all options expired on
Note 9. Commitments and Contingencies
Legal proceedings
From time-to-time, we may be involved in litigation relating to claims arising
out of our operations in the normal course of business. During the period
covered by this report, there were no material changes to the description of
legal proceedings set forth in our Annual Report on Form 10-K, as filed with the
15
Bitcoin Production Equipment and Operations
In
Electricity Contract
In
In connection with this agreement, the Company paid a
This agreement expires on
Management Agreement Termination Liability
On
Note 10. Employee Benefit Plans
The Company maintains defined contribution benefit plans under Section 401(k) of
the Internal Revenue Code covering substantially all qualified employees of the
Company (the "401(k) Plan"). Under the 401(k) Plan, the Company may make
discretionary contributions of up to 100% of employee contributions. During the
six months ended
Note 11. Subsequent Events
On
On
16
Item 2. Management's discussion and analysis of financial condition and results of operations
This Quarterly Report on Form 10-Q contains forward-looking statements that
involve risks and uncertainties, as well as assumptions that, if they never
materialize or prove incorrect, could cause our results to differ materially
from those expressed or implied by such forward-looking statements. The
statements contained herein that are not purely historical are forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). Forward-looking statements are often identified by the use of
words such as, but not limited to, "anticipate," "estimates," "should,"
"expect," "guidance," "project," "intend," "plan," "believe" and similar
expressions or variations intended to identify forward-looking statements. These
statements are based on the beliefs and assumptions of our management based on
information currently available to management. Such forward-looking statements
are subject to risks, uncertainties and other important factors that could cause
actual results and the timing of certain events to differ materially from future
results expressed or implied by such forward-looking statements. Factors that
could cause or contribute to such differences include, but are not limited to,
those identified below, and those discussed in the section titled "Risk Factors"
included in our Annual Report on Form 10-K for the fiscal year ended
Executive summary
All dollar figures set forth in this Quarterly Report on Form 10-Q are in thousands, except per-share amounts.
Current Operations
As of
During 2020, the Company began to suffer component issues, such as heat sinks
detaching from hash boards, and failures of both power supplies and hash board
temperature sensors. Although Bitmain has acknowledged manufacturing defects in
various production runs of S17 Bitcoin miners, the Company has not been
successful in obtaining any compensation from Bitmain to date. The manufacturing
defects, combined with inadequate repair facilities has rendered approximately
400 of our remaining 530 miners in need of repair or replacement. The Company is
using a third-party repair facility to repair its non-working hash boards and
expects the process to be complete in the third calendar quarter of this year.
While initial small batches of repaired hash boards have shown a high success
rate, there can be no guaranty that all future repairs will be as successful. As
of
17
MGT's miners are housed in two modified shipping containers on property owned by the Company adjacent to an electrical substation. The entire facility, including the land, two 2500 KVA 3-phase transformers, the mining containers, and miners, are owned by MGT. As the Company is presently using only a small portion of the built-out available electrical load, we have begun leasing space to other Bitcoin miners. In addition, we are exploring ways to grow and maintain our current operations including but not limited to further potential equipment sales and raising capital to acquire the newest generation miners.
Critical accounting policies and estimates
Our discussion and analysis of financial condition and results of operations are
based upon our consolidated financial statements, which have been prepared in
accordance with accounting principles generally accepted in
We believe the critical accounting policies listed below reflect significant judgments, estimates and assumptions used in the preparation of our unaudited condensed consolidated financial statements.
Revenue recognition
The Company's primary revenue stream is related to the mining of digital currencies. The Company derives its revenue by solving "blocks" to be added to the blockchain and providing transaction verification services within the digital currency network of Bitcoin, commonly termed "cryptocurrency mining." In consideration for these services, the Company receives digital currency ("Coins"). The Coins are recorded as revenue, using the average spot price of Bitcoin on the date of receipt. The Coins are recorded on the balance sheet as an intangible digital asset valued at the lower of cost or net realizable value. Net realizable value adjustments, to adjust the value of Coins to market value, are included in cost of revenue on the Company's consolidated statement of operations. Further, any gain or loss on the sale of Coins would be recorded to costs of revenue. Costs of revenue include electricity costs, equipment and infrastructure depreciation, and net realizable value adjustments.
The Company also recognizes a royalty participation upon the sale of certain
containers manufactured by
Property and Equipment
Property and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method on the various asset classes over their estimated useful lives, which range from one to ten years when placed in service. The cost of repairs and maintenance is expensed as incurred; major replacements and improvements are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income in the year of disposition. Deposits on property and equipment are initially classified as Other Assets and upon delivery, installation and full payment, the assets are classified as property and equipment on the consolidated balance sheet.
18
Impairment of long-lived assets
Long-lived assets are reviewed for impairment whenever facts or circumstances either internally or externally may suggest that the carrying value of an asset may not be recoverable, should there be an indication of impairment, we test for recoverability by comparing the estimated undiscounted future cash flows expected to result from the use of the asset to the carrying amount of the asset or asset group. Any excess of the carrying value of the asset or asset group over its estimated fair value is recognized as an impairment loss.
Stock-based compensation
The Company recognizes compensation expense for all equity-based payments in accordance with ASC 718 "Compensation - Stock Compensation". Under fair value recognition provisions, the Company recognizes equity-based compensation net of an estimated forfeiture rate and recognizes compensation cost only for those shares expected to vest over the requisite service period of the award.
Restricted stock awards are granted at the discretion of the compensation committee of the board of directors of the Company (the "Board of Directors"). These awards are restricted as to the transfer of ownership and generally vest over the requisite service periods, typically over a 12 to 24-month period (vesting on a straight-line basis). The fair value of a stock award is equal to the fair market value of a share of the Company's common stock on the grant date.
The fair value of an option award is estimated on the date of grant using the Black-Scholes option valuation model. The Black-Scholes option valuation model requires the development of assumptions that are inputs into the model. These assumptions are the expected stock volatility, the risk-free interest rate, the expected life of the option, the dividend yield on the underlying stock and the expected forfeiture rate. Expected volatility is calculated based on the historical volatility of the Company's common stock over the expected term of the option. Risk-free interest rates are calculated based on continuously compounded risk-free rates for the appropriate term.
Determining the appropriate fair value model and calculating the fair value of equity-based payment awards requires the input of the subjective assumptions described above. The assumptions used in calculating the fair value of equity-based payment awards represent management's best estimates, which involve inherent uncertainties and the application of management's judgment. The Company is required to estimate the expected forfeiture rate and recognize expense only for those shares expected to vest.
The Company accounts for share-based payments granted to non-employees in accordance with ASC 718-10, "Share-Based Payment," which requires the measurement and recognition of compensation expenses for all share-based payment awards made to employees and directors including employee stock options under the Company's stock plans and equity awards issued to non-employees based on estimated fair values.
ASC 718-10 requires companies to estimate the fair value of equity-based option awards on the date of grant using an option-pricing model. The fair value of the award is recognized as an expense on a straight-line basis over the requisite service periods in the Company's consolidated statements of comprehensive loss.
Recent accounting pronouncements
See Note 3 to our unaudited condensed consolidated financial statements appearing in Part I, Item 1 of this Quarterly Report for Recent Accounting Pronouncements.
Results of operations
Three months ended
Revenues
Our revenues for the three months ended
19
The Company is also entitled to a royalty from the sale of the Pod5ive
Containers. During the three months ended
Operating Expenses
Operating expenses for the three months ended
The decrease in cost of revenue of
Other Income and Expense
For the three months ended
Six months ended
Revenues
Our revenues for the six months ended
Operating Expenses
Operating expenses for the six months ended
The decrease in general and administrative expenses of
Other Income and Expense
For the six months ended
20
Liquidity and capital resources
Sources of Liquidity
We have historically financed our business through the sale of debt and equity
interests. We have incurred significant operating losses since inception and
continue to generate losses from operations and as of
In
The price of Bitcoin is volatile, and fluctuations are expected. Declines in the
price of Bitcoin have had a negative impact on our operating results and
liquidity and could harm the price of our common stock. Movements may be
influenced by various factors, including, but not limited to, government
regulation, security breaches experienced by service providers, as well as
political and economic uncertainties around the world. Since we record revenue
based on the price of earned Bitcoin and we may retain such Bitcoin as an asset
or as payment for future expenses, the relative value of such revenues may
fluctuate, as will the value of any Bitcoin we retain. The low and high exchange
price per Bitcoin for the year ending
The supply of Bitcoin is finite. Once 21 million Bitcoin are generated, the
network will stop producing more. Currently, there are approximately 19 million
Bitcoin in circulation, or 90% of the total supply of Bitcoin. Within the
Bitcoin protocol is an event referred to as Halving where the Bitcoin reward
provided upon mining a block is reduced by 50%. Halvings are scheduled to occur
once every 210,000 blocks, or roughly every four years, until the maximum supply
of 21 million Bitcoin is reached. The third Halving occurred on
Given a stable hash rate, a Halving reduces the number of new Bitcoin being generated by the network. While the effect is to limit the supply of new coins, it has no impact on the quantity of total Bitcoin outstanding. As a result, the price of Bitcoin could rise or fall based on overall investor and consumer demand. Should the price of Bitcoin remain unchanged after the next Halving, the Company's revenue would be reduced by 50%, with a much larger negative impact to profit.
Our primary source of operating funds has been through debt and equity financing.
COVID-19 pandemic:
The COVID-19 pandemic represents a fluid situation that presents a wide range of potential impacts of varying durations for different global geographies, including locations where we have offices, employees, customers, vendors and other suppliers and business partners.
Like most US-based businesses, the COVID-19 pandemic and efforts to mitigate the
same began to have impacts on our business in
21
In light of broader macro-economic risks and already known impacts on certain industries, we have taken, and continue to take targeted steps to lower our operating expenses because of the COVID-19 pandemic. We continue to monitor the impacts of COVID-19 on our operations closely and this situation could change based on a significant number of factors that are not entirely within our control and are discussed in this and other sections of this quarterly report on Form 10-Q.
To date, travel restrictions and border closures have not materially impacted our ability to operate. However, if such restrictions become more severe, they could negatively impact those activities in a way that would harm our business over the long term. Travel restrictions impacting people can restrain our ability to operate, but at present we do not expect these restrictions on personal travel to be material to our business operations or financial results.
Like most companies, we have taken a range of actions with respect to how we operate to assure we comply with government restrictions and guidelines as well as best practices to protect the health and well-being of our employees. However, the impacts of COVID-19 and efforts to mitigate the same have remained unpredictable and it remains possible that challenges may arise in the future.
On
On
Cash Flows Six Months ended June 30, 2021 2020 Cash provided by / (used in) Operating activities$ (638 ) $ (191 ) Investing activities 141 (72 ) Financing activities 1,000 108
Net increase (decrease) in cash and cash equivalents $ 503
Operating activities
Net cash used in operating activities was
Net cash used in operating activities of
Investing activities
Net cash provided by investing activities was
Net cash used in investing activities was
Financing activities
During the six months ended
During the six months ended
22
Off-balance sheet arrangements
As of
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