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convertible notes until they are converted into equity, repaid, or otherwise settled. For more information, see 
Note 4 to our consolidated financial statements included elsewhere in this prospectus.

Other Income (Expense), Net

Other income (expense), net consists primarily of the change in fair value of strategic investments and financial 
instruments,  the  change  in  fair  value  of  certain  derivative  instruments  in  connection  with  an  acquisition  of  a 
privately-held company in December 2025, interest expense from finance leases, and foreign currency exchange 
gains and losses. For more information on the acquisition, see Note 15 to our consolidated financial statements 
included elsewhere in this prospectus.

Provision for Income Taxes

The  provision  for  income  taxes  primarily  consists  of  income  taxes  in  certain  federal,  state,  local,  and  foreign 
jurisdictions  in  which  we  conduct  business.  Our  effective  tax  rates  will  vary  depending  on  the  impact  of  the 
valuation allowance and nondeductible fair value adjustments to derivatives, as well as the relative proportion 
of  foreign  income  to  domestic  income,  generation  of  tax  credits,  changes  in  the  valuation  of  our  deferred  tax 
assets and liabilities, and changes in tax laws.

Results of Operations

The following table sets forth our consolidated statements of operations data for the periods indicated:

(in millions)
Revenue

Operating expenses:

Compute and infrastructure 
Personnel(1)
Bartz settlement

Sales, marketing, and 
partnerships

Other operating and 
administrative

Total operating expenses

Operating loss

Interest income

Change in fair value of 
convertible notes, derivative 
liabilities, and SAFEs

Other income (expense), net

Total other income (expense), 
net

Loss before provision for income 
taxes

Year Ended December 31,
2024

2023

2025

Six Months Ended June 30,

2025

2026

$

41 $

386 $

4,585 $

1,163 $

16,286

433

2,522

95

—

2

62

592
(551)

69

454

—

43

347

3,366
(2,980)

106

7,326

1,839

1,500

568

1,412

12,645
(8,060)

431

2,334

538

—

120

306

3,298
(2,135)

115

8,945

3,152

—

3,168

1,714

16,979
(693)

1,111

(1,045)

(5,434)

(34,308)

(10,942)

(2)

—

(8)

—

(72,388)

(8,757)

(978)

(5,328)

(33,885)

(10,827)

(80,034)

Provision for income taxes
Net loss(2)

2
(1,531) $

1
(8,309) $

20
(41,965) $

7

(12,969) $

$

(1,529)

(8,308)

(41,945)

(12,962)

(80,727)

21
(80,748)

______________
(1)

 Includes  stock-based  compensation  expense  of $29 million,  $192 million,  and $1.2 billion  for  the  years  ended  December  31, 
2023,  2024,  and  2025,  respectively,  and $286  million  and $2.2  billion  for  the  six  months  ended  June  30,  2025  and  2026, 
respectively.
Includes change in fair value of convertible notes, derivative liabilities, and SAFEs, which were $1.0 billion, $5.4 billion, and 
$34.3 billion for the years ended December 31, 2023, 2024, and 2025, respectively, and $10.9 billion and $72.4 billion for the 
six months ended June 30, 2025 and 2026, respectively. These changes were primarily driven by an increase in the fair value of 

(2)

147