Given Almost $75 Million in Executed Preferred Stock Purchase Agreements, Hyperscale Data Does Not Currently Intend to Raise Additional Equity

Rhea-AI Summary

Hyperscale Data (NYSE: GPUS) announces it does not plan to pursue additional equity offerings, having secured preferred stock purchase agreements worth nearly $75 million. The company has received $51 million from Ault & Company, with an additional $24 million commitment through Series G convertible preferred stock. A separate agreement with an institutional investor for up to $50 million in Series B convertible preferred stock has yielded $5.7 million to date. The funding will support the expansion of their Michigan data center from 30MW to 340MW total power capacity, positioning the company for AI and HPC workloads. The power upgrade project is expected to take 44 months, with an additional 40MW from natural gas utility planned within 18 months. Hyperscale Data plans to separate from Ault Capital Group by end of 2025 to become an independent AI and digital infrastructure company.

Positive

• Secured significant funding commitments totaling up to $75 million through preferred stock agreements
• Planned expansion of Michigan data center power capacity from 30MW to 340MW for AI and HPC capabilities
• Agreement with natural gas utility to provide additional 40MW within 18 months
• Strategic transformation into pure-play AI and digital infrastructure platform through separation from Ault Capital Group

Negative

• Project completion timeline is lengthy at 44 months for main power upgrade
• Company anticipates need for significant debt financing for Michigan facility development
• Uncertainty in executing definitive agreements for power upgrades
• Risk of needing additional capital despite current commitments if market conditions or operational requirements change

Insights

Financial Strategist

Hyperscale Data secures $75M in preferred stock agreements, halting equity raises while pursuing 340MW data center expansion.

Hyperscale Data's announcement represents a significant shift in its financing strategy with $75 million in executed preferred stock purchase agreements. The company has secured commitments for up to an additional $68 million in preferred investments, including $24 million from Ault & Company (controlled by the founder) and up to $50 million from an institutional investor through multiple tranches. This structured approach provides staged capital access aligned with operational milestones, reducing immediate dilution pressure.

The capital infusion directly supports Hyperscale's ambitious Michigan data center expansion from 30MW to 340MW of power capacity - a substantial 1,033% increase positioning the company to host large-scale AI and high-performance computing workloads. This capacity expansion represents a strategic pivot toward becoming a pure-play AI and digital infrastructure platform.

The planned separation from Ault Capital Group by year-end 2025 marks another strategic repositioning, though investors should note several risk factors. The company still anticipates financing a significant portion of the Michigan facility through debt, and the power upgrade timeline spans 44 months with multiple contingencies including regulatory approvals and sufficient funding. While management expresses confidence in their six-month funding outlook, they acknowledge potential future capital needs based on market conditions, operational requirements, or strategic opportunities. The transition from diversified holding company to focused infrastructure play represents both significant opportunity and execution risk.

Agreements with Ault & Company and an Institutional Investor to Provide Capital Are Anticipated to Support Michigan Data Center Build-Out

LAS VEGAS, June 23, 2025 (GLOBE NEWSWIRE) -- Hyperscale Data, Inc. (NYSE American: GPUS), a diversified holding company (“Hyperscale Data” or the “Company”), today announced that it does not currently intend to pursue additional equity offerings, given that it has entered into existing financing agreements whereby it expects to raise up to an additional $68 million in preferred investments. These agreements, if completed in their entirety, would significantly bolster the Company’s capital position.

To date, Ault & Company, Inc., a private holding company controlled by the Company’s Founder and Executive Chairman, Milton “Todd” Ault III, has invested almost $51 million in Hyperscale Data through multiple tranches of preferred stock, and has agreed to invest up to an additional $24 million pursuant to the December 2024 securities purchase agreement providing for the purchase of up to $25 million shares of Series G convertible preferred stock and associated warrants.

Additionally, the Company recently entered into a separate securities purchase agreement with an institutional investor to sell up to $50 million of Series B convertible preferred stock (the “Series B Preferred”). The agreement provides for multiple tranche closings, offering the potential of ongoing access to capital aligned with the Company’s operational progress. To date, $5.7 million of Series B Preferred has been purchased under this agreement.

“With up to an additional $68 million in preferred equity commitments, we do not anticipate the need to raise additional equity in the next six months,” said Will Horne, CEO of Hyperscale Data. “This funding supports our strategy to expand the Michigan data center and drive long-term value creation as we evolve into a pure-play artificial intelligence (“AI”) and digital infrastructure platform.”

In February 2025, the Company announced that its indirect, wholly owned subsidiary Alliance Cloud Services, LLC (“ACS”) had reached an agreement in principle with its primary local utility to expand the Michigan facility’s available power from approximately 30 megawatts (“MW”) to 300 MW. The completion of this power upgrade is anticipated to take 44 months from execution of a formal letter of authorization between ACS and the utility, which is currently being negotiated.   In addition, the Company also announced that ACS has reached an agreement in principle with the local natural gas utility to provide an additional 40 MW. The project is expected to be completed within 18 months of the execution of definitive agreements. Combined, this expansion would bring the total expected power capacity of the data center to approximately 340 MW, positioning Hyperscale Data to host large-scale AI and high-performance computing (“HPC”) workloads.

The Company intends to complete its previously announced separation from Ault Capital Group, Inc. (“ACG”) by the end of 2025. Following the separation, Hyperscale Data will operate as an independent, publicly traded infrastructure company focused on AI and digital asset compute solutions.

While the Company currently believes that its existing preferred equity commitments will be sufficient to support its near term capital needs, future developments, including changes in market conditions, operational requirements, inability to reverse or reduce operating losses, decisions to make additional capital expenditures or strategic opportunities, may result in the need to raise additional capital sooner than anticipated. In addition, the Company currently anticipates financing a significant amount of the development of the Michigan facility through non-dilutive debt financing. There can be no assurance that additional financing will be available on favorable terms, or at all.  

The completion of the power upgrades is subject to a number of risks and uncertainties, one or more which could result in the project being curtailed, delayed or terminated, including, but not limited to: failure to agree upon terms and execute definitive agreements; the inability of the Company or ACS to raise sufficient funds to pay for the power upgrades; failure to obtain regulatory consents and approvals; the inability to obtain sufficient easements, rights-of-way and land rights necessary to the work to be performed, and other presently unforeseen events or conditions.

This press release is for information purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities in any state or other jurisdiction in which such offer, solicitation or sale or such assets or securities would be unlawful under the laws of any such state or other jurisdiction.

For more information on Hyperscale Data and its subsidiaries, Hyperscale Data recommends that stockholders, investors and any other interested parties read Hyperscale Data’s public filings and press releases available under the Investor Relations section at hyperscaledata.com or available at www.sec.gov.

About Hyperscale Data, Inc.

Through its wholly owned subsidiary Sentinum, Inc., Hyperscale Data owns and operates a data center at which it mines digital assets and offers colocation and hosting services for the emerging AI ecosystems and other industries. Hyperscale Data’s other wholly owned subsidiary, ACG, is a diversified holding company pursuing growth by acquiring undervalued businesses and disruptive technologies with a global impact.

Hyperscale Data expects to divest itself of ACG on or about December 31, 2025 (the “Divestiture”). Upon the occurrence of the Divestiture, the Company would solely be an owner and operator of data centers to support HPC services, though it may at that time continue to mine Bitcoin. Until the Divestiture occurs, the Company will continue to provide, through ACG and its wholly and majority-owned subsidiaries and strategic investments, mission-critical products that support a diverse range of industries, including an AI software platform, social gaming platform, equipment rental services, defense/aerospace, industrial, automotive, medical/biopharma and hotel operations. In addition, ACG is actively engaged in private credit and structured finance through a licensed lending subsidiary. Hyperscale Data’s headquarters are located at 11411 Southern Highlands Parkway, Suite 190, Las Vegas, NV 89141.

On December 23, 2024, the Company issued one million (1,000,000) shares of a newly designated Series F Exchangeable Preferred Stock (the “Series F Preferred Stock”) to all common stockholders and holders of the Series C Convertible Preferred Stock on an as-converted basis. The Divestiture will occur through the voluntary exchange of the Series F Preferred Stock for shares of Class A Common Stock and Class B Common Stock of ACG (collectively, the “ACG Shares”). The Company reminds its stockholders that only those holders of the Series F Preferred Stock who agree to surrender such shares, and do not properly withdraw such surrender, in the exchange offer through which the Divestiture will occur, will be entitled to receive the ACG Shares and consequently be stockholders of ACG upon the occurrence of the Divestiture.

Forward-Looking Statements

This press release contains “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. These forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “believes,” “plans,” “anticipates,” “projects,” “estimates,” “expects,” “intends,” “strategy,” “future,” “opportunity,” “may,” “will,” “should,” “could,” “potential,” or similar expressions. Statements that are not historical facts are forward-looking statements. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties.

Forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update any of them publicly in light of new information or future events. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors. More information, including potential risk factors, that could affect the Company’s business and financial results are included in the Company’s filings with the U.S. Securities and Exchange Commission, including, but not limited to, the Company’s Forms 10-K, 10-Q and 8-K. All filings are available at www.sec.gov and on the Company’s website at hyperscaledata.com.

Hyperscale Data Investor Contact:
IR@hyperscaledata.com or 1-888-753-2235

FAQ

How much funding has Hyperscale Data (GPUS) secured through preferred stock agreements?

Hyperscale Data has secured nearly $75 million in preferred stock purchase agreements, including $51 million already invested by Ault & Company and commitments for up to $74 million more through Series G and Series B preferred stock.

What is the planned power capacity expansion for Hyperscale Data's Michigan data center?

The Michigan data center plans to expand from approximately 30 megawatts to 340 megawatts total power capacity, including 300MW from the primary utility and 40MW from natural gas.

When will Hyperscale Data separate from Ault Capital Group?

Hyperscale Data plans to complete its separation from Ault Capital Group by the end of 2025 to become an independent, publicly traded infrastructure company.

How long will the Michigan data center power upgrade take to complete?

The main power upgrade is anticipated to take 44 months from the execution of a formal letter of authorization, while the additional natural gas utility project is expected to complete within 18 months.

Who are the major investors in Hyperscale Data's preferred stock agreements?

The major investors are Ault & Company, controlled by Founder and Executive Chairman Milton Todd Ault III, and an unnamed institutional investor for Series B convertible preferred stock.