SATO Technologies Reports Results for Q2 2025 and Announces Participation at the H.C. Wainwright 27th Annual Global Investment Conference in New York

Rhea-AI Summary

SATO Technologies (OTCQB:CCPUF) reported Q2 2025 financial results showing resilience amid challenging market conditions following the Bitcoin halving. The company generated positive mining profit of $431,505 for Q2 and $1.27 million for H1 2025, despite reduced block rewards and increased network difficulty.

Key financial metrics include a net loss of $770,000 in Q2, digital assets revenue decrease to $3.0 million, and reduced total liabilities by 22% to $7.5 million. The company is advancing its AI transition with a $427,000 investment and has received non-binding interest for up to $125 million in combined equity and debt financing.

Operational improvements include reduced downtime to ~1% in Q2 from 12% in Q1, alongside successful cost reduction initiatives in operating and administrative expenses.

Positive

• Positive mining profit of $431,505 in Q2 2025 despite halving impact
• Reduced total liabilities by 22% to $7.5 million
• Decreased operating expenses from $6.6M to $5.8M year-over-year
• Improved operational efficiency with downtime reduced to ~1% from 12%
• Received non-binding financing interest for up to $125M combined
• Higher average realized Bitcoin price (~50% increase year-over-year)

Negative

• Net loss of $770,000 in Q2 2025
• Digital assets revenue declined to $3.0M from $4.3M year-over-year
• Shareholders' equity decreased 18% to $6.9M
• Digital asset holdings decreased to $3.12M from $4.56M
• Company has not yet achieved net profitability

Toronto, Ontario--(Newsfile Corp. - August 27, 2025) - SATO Technologies Corp. (TSXV:SATO) (OTCQB: CCPUF) (the "Company", or "SATO") a provider of high-density compute infrastructure, today announced its unaudited financial results for Q2 2025. Please refer to the Company's Financial Statements and the accompanying Management's Discussion and Analysis for full details and discussion of the results, copies of which have been filed and are available under the Company's profile on SEDAR+ (www.sedarplus.ca) and are available on the Company's website (www.bysato.com). All amounts are in Canadian dollars, unless otherwise stated.

Q2 2025 - Transitioning Through Industry Headwinds

The second quarter of 2025 reflected the impact of the April 2024 Bitcoin halving and record-high network difficulty. The halving reduced block rewards by 50%, while global competition drove hashrate to approximately 920 EH/s, lowering the amount of BTC earned per unit of compute.

Despite this, SATO maintained strong uptime, experienced no Q2 load shedding, avoided downtime, and continued to run one of the most efficient fleets in the sector. Our average realized Bitcoin price was ~50% higher than last year, helping offset reduced production.

Key Results

• Positive mining profit: Gross profit before depreciation and amortization (non-IFRS measure): Center One operations generated $431,505 for the three months and $1,267,170 for the six months ended June 30, 2025, respectively.

• Cost discipline: Decreased site opex, repairs, and depreciation year-over-year.

• Operational gains: Downtime cut to ~1% in Q2 from 12% in Q1.

• Digital Asset Treasury Strategy: The Company is evaluating a strategy to increase its Bitcoin holdings and leverage them to mine additional Bitcoin, with the objective of enhancing mNAV and Bitcoin per share over time.

• AI Factory: SATO also advanced its AI transition and for the six months ended June 30, 2025, management estimates that approximately $427,000 has been invested in this initiative. 
  
  These efforts are focused on:

1. AI Factory design at Center One with top-tier contractors.

2. Financing, where the Company has received non-binding expressions of interest for up to $25 million in equity and up to $100 million in debt from institutional parties, while also advancing Federal and Provincial grant applications.

3. Client development, actively engaging with prospective customers for GPU hosting opportunities.

"Q2 marks an inflection point: halving headwinds are visible, but so is our shift toward sustainable, contracted AI cash flows. Our core strengths -- low-cost clean hydro energy, operational discipline, and adaptability -- now underpin SATO's next phase of growth. While we have not yet achieved net profitability, our operations remain cash flow positive, and we are deliberately reinvesting into AI infrastructure and digital asset strategies that we believe will drive long-term shareholder value," said Romain Nouzareth, Chair and CEO of SATO.

Q2 Key Financial Metrics

• Net Loss of $0.77 million and $1.65 million for the three and six months ended June 30, 2025 (net loss of $0.92 million and net income of $2.99 million for the three and six months ended July 31, 2024)

• Digital Assets Revenue decreased to $3.0 million and $6.0 million for the three and six months ended June 30, 2025 ($4.3 million and $10.2 million for the three and six months ended June 30, 2024)

• Operating Loss of $0.33 million and $0.88 million for the three and six months ended June 30, 2025 (operating loss of $0.61 million and operating income of $3.27 million for the three and six months ended June 30, 2024)

• Gross Loss of $0.11 million and gross profit of $0.19 million for the three and six months ended June 30, 2025, reflecting consistent mining performance

• Total Liabilities reduced by 22% to $7.5 million (December 31, 2024: $9.7 million)

• Shareholders' Equity decreased 18% to $6.9 million (December 31, 2024: $8.3 million)

• Digital Asset Holdings decreased to $3.12 million (December 31, 2024: $4.56 million)

Strategic and Operational Highlights

• Cost Reductions: The company has decreased both operating expenses (from $6.6 million for the six months ended June 30, 2024 to $5.8 million for the six months ended June 30, 2025), and general and administrative expenses (from $1.69 million for the six months ended June 30, 2024 to $1.21 million for the six months ended June 30,2025).

• Liabilities Reduction: Decrease of over $2.1 million in liabilities from December 31, 2024.

• Bitcoin Price Strength: Bitcoin rose from approximately USD 81,559 at the end of March 2025 to an all-time high of USD 124,436.80 on August 14, 2025, before retracting to ~USD 110,000 as of August 26, 2025, underlining the continued volatility of the asset.

SATO Technologies management has prepared a presentation of these results available on YouTube for your review: https://youtu.be/G03s1ZtLbxM

SATO Technologies will also participate in the H.C. Wainwright 27th Annual Global Investment Conference in New York, taking place September 8-10, 2025. Investors are invited to register and schedule a meeting with management at: https://hcwevents.com/annualconference/.

On behalf of the board,

Romain Nouzareth, SATO CEO and Chairman

About SATO
SATO, founded in 2017, is a publicly listed company providing efficient computing power. The Company currently operates one data center tailored to provide computing power for Bitcoin Mining, but may look to expand or add additional data centers for computing power for Bitcoin Mining, High Power Computing ("HPC"), Artificial Intelligence ("AI"). The Company is listed on TSXV: SATO & OTCQB: CCPUF. To learn more about SATO, visit www.bysato.com.

For additional information, please contact:
Investor Relations:
invest@bysato.com
Phone: +1 (347) 280 3663

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

Cautionary Statement Regarding Forward-Looking Information

Certain statements in this news release are forward-looking statements or contain forward-looking information, which may include, but are not limited to, statements with respect to the future financial or operating performance of SATO and its projects, business strategy, corporate plans, objectives and goals, as well as the market conditions applicable to SATO. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements include, among others: expectations regarding the market for AI services and the Company's ability to penetrate that market; expectations regarding available financing; expectations regarding client development for new business ventures; expectations regarding foreign exchange rates; statements relating to the business and future activities of and developments related to SATO; statements relating to the finances of SATO not based on the audited financial statements of SATO; the expected success of business activities; expectations for other economic, business, regulatory and/or competitive factors related to SATO in general, including the price of digital assets; the business objectives and milestones of SATO; the amount and principal uses of available funds, including the funds to be used for anticipated investments; and other events or conditions that may occur in the future.

Forward-looking information and statements are based on current expectations, beliefs, assumptions, estimates and forecasts about the Company's business and the industry and markets in which it operates, as of the date of this news release. Although the assumptions made by the Company in providing forward looking information or making forward looking statements are considered reasonable by management at the time, there can be no assurance that such assumptions will prove to be accurate.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of SATO to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, but are not limited to, the factors discussed in the section entitled "Risk Factors" in the Company's most recent Annual Information Form (the "AIF"), including risks relating to the cryptocurrency mining industry, risks related to SATO's operations; risks related to the price of Bitcoin and other cryptocurrencies; risks related to governmental regulation and enforcement; volatility of the common shares of the Company (the "Common Shares"); cybersecurity risks; risks related to electrical power and internet; and tax risks. Although SATO has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Forward-looking statements contained herein and in the AIF are made as of the date of the respective document in which they are contained and, other than as required by law, SATO disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/264219

FAQ

What were SATO Technologies (CCPUF) Q2 2025 earnings results?

SATO reported a net loss of $770,000, with digital assets revenue of $3.0 million and positive mining profit of $431,505. The company achieved gross profit before depreciation of $1.27 million for H1 2025.

How did the Bitcoin halving impact SATO Technologies in Q2 2025?

The April 2024 Bitcoin halving reduced block rewards by 50%, while increased global competition drove hashrate to 920 EH/s, resulting in lower BTC earned per unit of compute. However, higher Bitcoin prices helped offset reduced production.

What is SATO Technologies' AI transition strategy?

SATO invested $427,000 in its AI initiative, focusing on AI Factory design at Center One, securing up to $125 million in potential financing, and developing GPU hosting opportunities with prospective clients.

How much did SATO Technologies reduce its operating expenses in 2025?

SATO decreased operating expenses from $6.6 million to $5.8 million for H1 2025 year-over-year, and reduced general and administrative expenses from $1.69 million to $1.21 million.

What is SATO Technologies' current financial position?

As of Q2 2025, SATO has total liabilities of $7.5 million (reduced by 22%), shareholders' equity of $6.9 million, and digital asset holdings of $3.12 million.