CalEthos Reports No Revenue and Increased Losses in Latest Financial Filing

CalEthos, Inc. reported significant financial challenges in its latest 10-Q filing for the quarter ending September 30, 2025. The company recorded no revenue for both the three and nine months ended September 30, 2025, maintaining a trend from the previous year. Operating expenses totaled $714,000 for the nine-month period, a decrease of 14.5% from $835,000 in the same period of 2024. The reduction in expenses was primarily due to lower professional fees and a significant recapture of equity-based compensation, which amounted to $(10,000) compared to $318,000 in the prior year. Despite these reductions, the company reported a net loss of $5.74 million for the nine months, an improvement from a loss of $9.33 million in the same period of 2024.

The company’s financial position has deteriorated, with total assets dropping to $287,000 from $6.15 million at the end of 2024. Current liabilities surged to $1.16 million, up from $515,000, leading to a working capital deficit of $876,000, compared to a deficit of $219,000 at the end of the previous fiscal year. This increase in liabilities was driven by a rise in accounts payable and accrued expenses, as well as a significant increase in notes payable to related parties, which rose to $471,000 from $11,000.

Strategically, CalEthos has shifted its focus from developing a data center campus in Imperial County, California, to exploring alternative locations with more favorable regulatory environments. The company formed a wholly-owned subsidiary, TerraVolt Infrastructure Inc., in May 2025, aimed at providing Infrastructure-as-a-Service (IaaS) solutions for data center development. This strategic pivot comes after the company decided not to renew its purchase option on a 315-acre parcel of land due to delays in obtaining necessary regulatory approvals.

Operationally, the company has faced challenges in maintaining its workforce, with payroll and related expenses increasing significantly to $421,000 for the nine months ended September 30, 2025, compared to $175,000 in the prior year. This increase is attributed to the abandonment of the data center project, which resulted in the cessation of capitalizing payroll expenses. The company’s cash position also reflects these challenges, with cash and cash equivalents decreasing to $274,000 from $286,000 at the end of 2024.

Looking ahead, CalEthos acknowledges the need for substantial financing to support its operations and development plans. The company intends to raise funds through the issuance of common stock, preferred stock, and/or debt securities. However, management has expressed concerns regarding its ability to secure necessary capital, which could significantly impact its operational viability and growth prospects. The company’s ability to continue as a going concern remains uncertain, as it has not generated revenue in the last two fiscal years and has accumulated a deficit of approximately $37.61 million as of September 30, 2025.