Nakamoto Inc. 2026 Q1 10-Q Summary
Business Context and Reporting Period
This Form 10-Q covers the fiscal quarter ended March 31, 2026. Nakamoto Inc. (formerly KindlyMD) is a Bitcoin operating company that transitioned from a healthcare business in late 2025. During Q1 2026, the Company completed two major acquisitions: BTC Inc. (Bitcoin media and events) and UTXO Management GP, LLC (digital asset fund management). The Company now operates four segments: Media & Information Services, Asset Management, Bitcoin Operations, and Healthcare Operations (which management intends to exit by Q2 2026).
Key Financial Metrics
| Metric | Q1 2026 | Q1 2025 |
|---|---|---|
| Total Operating Revenue | $2.68 million | $0.58 million |
| Net Loss | $(238.78) million | $(1.04) million |
| Operating Loss | $(126.17) million | $(1.04) million |
| Cash and Cash Equivalents | $35.30 million | $1.14 million |
| Digital Assets (Bitcoin) | $345.59 million (5,064 BTC) | $467.55 million |
| Total Debt (Notes Payable) | $209.74 million | $209.56 million |
| Stockholders' Equity | $367.07 million | $514.26 million |
Material Changes vs. Prior Period
- Revenue Growth: Revenue increased 362% year-over-year, driven by the inclusion of Media, Advisory, Asset Management, and Derivative revenue streams from the BTC Inc. and UTXO acquisitions.
- Significant Losses: The Net Loss of $238.8 million was primarily driven by non-cash mark-to-market adjustments:
- Digital Assets: A $102.5 million loss due to Bitcoin price decline (from ~$87,500 to ~$68,200).
- Call Option Asset: A $107.7 million loss on the fair value of the call option to acquire BTC Inc. prior to closing.
- Investments: A $7.9 million loss on investments (Metaplanet and Treasury B.V.).
- Balance Sheet Shifts: Total assets decreased from $730.6 million to $620.8 million, largely due to the write-down of digital assets and the call option asset. Goodwill increased by $93.5 million due to acquisitions.
- Segment Restructuring: The Company moved from a single healthcare segment in 2025 to four distinct segments in 2026.
Guidance, Outlook, and Risks
- Strategic Exit: Management announced an intention to exit the legacy Healthcare Operations business by the end of Q2 2026.
- Capital Structure: Stockholders approved a reverse stock split (ratio between 1-for-20 and 1-for-50) on May 8, 2026.
- Liquidity: The Company holds $35.3 million in cash and 659 unencumbered Bitcoin (~$44.9 million). Management believes liquidity is sufficient for the next 12 months, though it is highly sensitive to Bitcoin price volatility.
- Debt Obligations: The Company has a $210 million loan with Kraken (8% interest) maturing December 4, 2026. Approximately 4,405 BTC are pledged as collateral.
- Controls: The Company disclosed that its disclosure controls and procedures were not effective as of March 31, 2026, due to a material weakness in internal control over financial reporting.
- Derivatives: The Company actively writes covered calls and buys protective puts to generate income and hedge downside risk.
Investor Verification Checklist
- Bitcoin Price Sensitivity: Verify the impact of current Bitcoin prices on the $345.6 million digital asset valuation and the collateral requirements for the $210 million Kraken loan.
- Acquisition Integration: Review the preliminary purchase price allocations for BTC Inc. and UTXO, specifically the $93.5 million in goodwill and $99.3 million in intangible assets, for potential future impairment risks.
- Healthcare Exit: Monitor the timeline and costs associated with the planned shutdown of the Healthcare Operations segment.
- Internal Controls: Assess the remediation plan for the material weakness in internal controls over financial reporting.
- Reverse Split: Confirm the final ratio of the approved reverse stock split and its impact on share count and liquidity.