Bit Digital posts $261M nine-month loss in 2026
Bit Digital describes a focus on Ethereum staking and treasury activities while continuing to wind down digital-asset mining.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Bit Digital, Inc. reported third-quarter revenue of $27.067 million, compared with $30.465 million a year earlier; revenue for the first nine months was $87.106 million, versus $81.223 million. Third-quarter consolidated net income was $0.600 million, compared with $146.725 million, while the nine-month period recorded a $261.343 million net loss versus $103.887 million net income a year earlier. Digital-asset gains were $84.040 million in the quarter, versus $168.041 million; the nine-month result included $65.871 million in digital-asset losses versus $145.990 million in gains.
In the quarter, cloud-services revenue was $18.106 million, colocation revenue was $5.617 million, and digital-asset mining revenue was $2.022 million, compared with $7.416 million from mining a year earlier. Bit Digital describes a focus on Ethereum staking and treasury activities and says it is winding down digital-asset mining; majority-owned WhiteFiber operates its high-performance computing business. Nine-month operating cash flow was $163.239 million provided, compared with $204.865 million used a year earlier. Total liabilities were $1,013.351 million as of September 30, 2026, versus $309.157 million as of December 31, 2025.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointNine-month revenue was $87.106 million, versus $81.223 million a year earlier.
- Moderate pointNine-month operating cash flow provided $163.239 million, compared with $204.865 million used a year earlier.
Negative
- Major pointNine-month net loss was $261.343 million, versus $103.887 million net income a year earlier.
- Moderate pointThird-quarter revenue fell to $27.067 million, from $30.465 million a year earlier.
Filing Explained
At September 30, 2026, the balance sheet recorded $445,330 thousand of convertible notes payable, net.
This unaudited quarterly report shows Bit Digital's outstanding ordinary shares increased from 324,192,228 at
Convertible notes payable, net, were
Key Figures
Key Terms
liquid staking technical
Digital Asset Collateral Receivable financial
induced conversion expense financial
remaining performance obligations financial
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How much revenue did BTBT report in the third quarter and first nine months of 2026?
Was BTBT profitable in the third quarter and first nine months of 2026?
How much ETH did BTBT liquid stake during the first nine months of 2026?
How much ETH did BTBT have natively staked as of September 30, 2026?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
For the quarterly period ended
For the transition period from __________ to __________
Commission file number:
| (Exact name of registrant as specified in its charter) |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
|
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number:
Securities registered pursuant to Section 12(b) of the Exchange Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| ☒ | Smaller reporting company | ||
| Emerging growth company | |||
If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
Applicable only to Corporate Issuers:
Indicate the number of shares outstanding of each of the issuers’ classes of common stock, as of the latest practicable date:
TABLE OF CONTENTS
| Page | ||
| CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS | ii | |
| PART I | ||
| Item 1. | Financial Statements. | 1 |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations. | 56 |
| Item 3. | Quantitative and Qualitative Disclosures about Market Risk. | 89 |
| Item 4. | Controls and Procedures. | 90 |
| PART II | 91 | |
| Item 1. | Legal Proceedings. | 91 |
| Item 1A. | Risk Factors. | 92 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds. | 93 |
| Item 3. | Defaults Upon Senior Securities. | 93 |
| Item 4. | Mine Safety Disclosures. | 93 |
| Item 5. | Other Information. | 93 |
| Item 6. | Exhibits. | 94 |
| SIGNATURES | 95 | |
i
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions.
We intend such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements and are including this statement for purposes of complying with those safe-harbor provisions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. In particular, information included under “Risk Factors,” “Business,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other sections of this report contain forward-looking statements. Where, in any forward-looking statement, an expectation or belief as to future results or events is expressed, such expectation or belief is based on the current plans and expectations of Bit Digital, Inc.’s (“Bit Digital”) management and expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the expectation or belief will result or be achieved or accomplished. Whether any such forward-looking statements are in fact achieved will depend on future events, some of which are beyond Bit Digital’s control. Except as may be required by law, Bit Digital undertakes no obligation to modify or revise any forward-looking statements to reflect new information, events or circumstances occurring after the date of this report. Comparisons of results for current and any prior periods are not intended to express any future trends, or indications of future performance, unless expressed as such, and should only be viewed as historical data.
Factors which could have a material adverse effect on our operations and future prospects on a consolidated basis include but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Further information concerning our business, including additional factors that could materially affect our financial results, is included herein and in our other filings with the U.S. Securities and Exchange Commission (the “SEC”).
ii
Item 1. Financial Statements and Supplementary Data
BIT DIGITAL, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
As of September 30, 2026 and December 31, 2025
(Expressed in thousands, except for the number of shares)
| September 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| (audited) | ||||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Restricted cash | ||||||||
| Accounts receivable, net | ||||||||
| USDC | ||||||||
| Net investment in lease – current, net | ||||||||
| Loans receivable | ||||||||
| Digital asset collateral receivable | - | |||||||
| Other current assets, net | ||||||||
| Total Current Assets | ||||||||
| Non-Current Assets | ||||||||
| Deposits for property, plant, and equipment | ||||||||
| Property, plant, and equipment, net | ||||||||
| Goodwill | ||||||||
| Digital assets | ||||||||
| Digital intangible assets | - | |||||||
| Intangible assets, net | ||||||||
| Operating lease right-of-use assets, net | ||||||||
| Finance lease right-of-use assets, net | - | |||||||
| Net investment in lease - non-current, net | ||||||||
| Investment securities | ||||||||
| Deferred tax assets | ||||||||
| Other non-current assets, net | ||||||||
| Total Non-Current Assets | ||||||||
| Total Assets | $ | $ | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current Liabilities | ||||||||
| Accounts payable | $ | $ | ||||||
| Current portion of deferred revenue | ||||||||
| Current portion of operating lease liabilities | ||||||||
| Current portion of finance lease liabilities | - | |||||||
| Short-term debt and current portion of long-term debt, net | - | |||||||
| Income tax payable | - | |||||||
| Other payables and accrued liabilities | ||||||||
| Total Current Liabilities | ||||||||
| Non-Current Liabilities | ||||||||
| Non-current portion of deferred revenue | ||||||||
| Non-current portion of operating lease liabilities | ||||||||
| Long-term debt, net | - | |||||||
| Convertible notes payable, net | ||||||||
| Derivative liability | ||||||||
| Deferred tax liabilities | ||||||||
| Other long-term liabilities | - | |||||||
| Total Non-Current Liabilities | ||||||||
| Total Liabilities | $ | $ | ||||||
| Commitments and Contingencies – Note 21 | ||||||||
| Bit Digital Shareholders’ Equity | ||||||||
| Preference shares, $ | ||||||||
| Ordinary shares, $ | ||||||||
| Treasury stock, at cost, | ( | ) | ( | ) | ||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Accumulated other comprehensive (loss) income | ( | ) | ||||||
| Total Bit Digital shareholders’ equity | ||||||||
| Non-controlling Interests | ||||||||
| Total Equity | ||||||||
| Total Liabilities and Equity | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
1
BIT DIGITAL, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS
For the Three and Nine Months Ended September 30, 2026 and 2025
(Expressed in thousands, except per share data)
| For the Three Months Ended September 30, |
For the Nine Months Ended September 30, |
|||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenues | ||||||||||||||||
| Digital asset mining | $ | $ | $ | $ | ||||||||||||
| Cloud services | ||||||||||||||||
| Colocation services | ||||||||||||||||
| ETH staking | ||||||||||||||||
| Other | ||||||||||||||||
| Total revenues | ||||||||||||||||
| Operating costs and expenses | ||||||||||||||||
| Cost of revenue (exclusive of depreciation and amortization shown below) | ||||||||||||||||
| Digital asset mining | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Cloud services | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Colocation services | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| ETH staking | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Depreciation and amortization expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Impairment of capitalized software assets | - | - | ( | ) | - | |||||||||||
| General and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Gains (losses) on digital assets | ( | ) | ||||||||||||||
| Gains on digital intangible assets | - | - | ||||||||||||||
| Impairment on digital intangible assets | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total operating income (expenses) | ( | ) | ||||||||||||||
| Income (loss) from operations | ( | ) | ||||||||||||||
| Net gain (loss) from disposal of property and equipment | ( | ) | ( | ) | ||||||||||||
| Change in fair value of derivative liability | - | - | ||||||||||||||
| Interest expense | ( | ) | - | ( | ) | - | ||||||||||
| Induced conversion expense | ( | ) | - | ( | ) | - | ||||||||||
| Other income (expense), net | ( | ) | ||||||||||||||
| Total other (expense) income, net | ( | ) | ( | ) | ||||||||||||
| Income (loss) before income taxes | ( | ) | ||||||||||||||
| Income tax expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net income (loss) | $ | $ | $ | ( | ) | $ | ||||||||||
| Net loss attributable to noncontrolling interest | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net income (loss) attributable to Bit Digital shareholders | $ | $ | $ | ( | ) | $ | ||||||||||
| Weighted average number of ordinary shares outstanding | ||||||||||||||||
| Basic | ||||||||||||||||
| Diluted | ||||||||||||||||
| Earnings (loss) per share | ||||||||||||||||
| Basic | $ | $ | $ | ( | ) | $ | ||||||||||
| Diluted | $ | $ | $ | ( | ) | $ | ||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
2
BIT DIGITAL, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
OF COMPREHENSIVE (LOSS) INCOME
For the Three and Nine Months Ended September 30, 2026 and 2025
(Expressed in thousands, except for the number of shares)
| For the Three Months Ended September 30, |
For the Nine Months Ended September 30, |
|||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net income (loss) | $ | $ | $ | ( | ) | $ | ||||||||||
| Other comprehensive income (loss) | ||||||||||||||||
| Foreign currency translation adjustment | ( | ) | ( | ) | ||||||||||||
| Comprehensive income (loss) | ( | ) | ||||||||||||||
| Comprehensive loss attributable to noncontrolling interests | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Comprehensive income (loss) attributable to Bit Digital shareholders | $ | $ | $ | ( | ) | $ | ||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
3
BIT DIGITAL, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
For the Three and Nine Months Ended September 30, 2026 and 2025
(Expressed in thousands, except for the number of shares)
| Preference Shares |
Ordinary Shares |
Treasury | Additional paid-in |
Retained Earnings (Accumulated |
Accumulated other comprehensive |
Noncontrolling | Total Stockholders’ |
|||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Par Value | Shares | Amount | capital | deficit) | (loss) income | interest | Equity | ||||||||||||||||||||||||||||||||||
| Balances, December 31, 2024 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | - | $ | |||||||||||||||||||||||||||
| Share-based compensation expense | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Issuance of ordinary shares/At-the-market offering, net of offering costs | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to employees | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to consultants | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to director | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | - | - | - | - | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||||||||||||||
| Net loss | - | - | - | - | - | - | - | ( | ) | - | - | ( | ) | |||||||||||||||||||||||||||||||
| Balances, March 31, 2025 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | - | $ | |||||||||||||||||||||||||||
| Share-based compensation expense | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Issuance of ordinary shares/At-the-market offering, net of offering costs | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Issuance of ordinary shares/public offering, net of offering costs | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to consultants | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to employees | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Other comprehensive income | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Net income | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Balances, June 30, 2025 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | $ | - | $ | |||||||||||||||||||||||||||||
| Share-based compensation expense | - | - | - | - | - | - | ( | ) | - | - | - | ( | ) | |||||||||||||||||||||||||||||||
| Changes in ownership interests in a subsidiary - IPO | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
| Changes in ownership interests in a subsidiary - underwriters’ over-allotment option exercise | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
| Changes in ownership interests in a subsidiary - settlement of subsidiary RSUs | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Issuance of ordinary shares/At-the-market offering, net of offering costs | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Issuance of ordinary shares/public offering, net of offering costs | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to consultants | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to employees | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | - | - | - | - | - | - | - | - | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Net income (loss) | - | - | - | - | - | - | - | - | ( | ) | ||||||||||||||||||||||||||||||||||
| Balances, September 30, 2025 | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Balances, December 31, 2025 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||||||||||
| Share-based compensation expense | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Issuance of ordinary shares/At-the-market offering, net of offering costs | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Declaration of dividends to preferred shareholders | - | - | - | - | - | - | - | ( | ) | - | - | ( | ) | |||||||||||||||||||||||||||||||
| Changes in ownership interests in a subsidiary - settlement of subsidiary RSUs | - | - | - | - | - | - | ( | ) | - | - | - | |||||||||||||||||||||||||||||||||
| Purchase of zero-strike call options in connection with issuance of convertible notes | - | - | - | - | - | - | ( | ) | - | - | - | ( | ) | |||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to employees | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to director | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | - | - | - | - | - | - | - | - | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Net loss | - | - | - | - | - | - | - | ( | ) | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Balances, March 31, 2026 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||||||||||
| Share-based compensation expense | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Issuance of ordinary shares/At-the-market offering, net of offering costs | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Changes in ownership interests in a subsidiary - settlement of subsidiary RSUs | - | - | - | - | - | - | ( | ) | - | - | - | |||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to consultants | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to employees | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to director | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | - | - | - | - | - | - | - | - | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Net loss | - | - | - | - | - | - | - | ( | ) | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Balances, June 30, 2026 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||||||||||||||
| Share-based compensation expense | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Issuance of common stock/At-the-market offering, net of offering costs | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Changes in ownership interests in a subsidiary - settlement of subsidiary RSUs | - | - | - | - | - | - | ( | ) | - | - | - | |||||||||||||||||||||||||||||||||
| Induced conversion on 2031 Notes | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of ordinary shares to employees | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Share-based compensation in connection with issuance of preference shares to employees | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
| Cancellation of ordinary shares | - | - | ( | ) | ( | ) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||
| Other comprehensive gain (loss) | - | - | - | - | - | - | - | - | ( | ) | ||||||||||||||||||||||||||||||||||
| Net income (loss) | - | - | - | - | - | - | - | - | ( | ) | ||||||||||||||||||||||||||||||||||
| Balances, September 30, 2026 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
4
BIT DIGITAL, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended September 30, 2026 and 2025
(Expressed in thousands, except for the number of shares)
| For the Nine Months Ended September 30, |
||||||||
| 2026 | 2025 | |||||||
| Cash Flows from Operating Activities: | ||||||||
| Net (loss) income | $ | ( | ) | $ | ||||
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||||||||
| Depreciation and amortization expenses | ||||||||
| Impairment of capitalized software assets | - | |||||||
| (Gain) loss from disposal of property, plant, and equipment | ( | ) | ||||||
| Gain on net investment in lease | ( | ) | - | |||||
| Amortization of discount on debts issued | - | |||||||
| Induced conversion expense | - | |||||||
| Losses (gains) on digital assets | ( | ) | ||||||
| Share-based compensation expenses | ||||||||
| Changes in fair value of investment security | ( | ) | ||||||
| Changes in fair value of derivative liability | ( | ) | - | |||||
| Current expected credit losses | ||||||||
| Digital assets mined | ( | ) | ( | ) | ||||
| Digital assets earned from staking | ( | ) | ( | ) | ||||
| Impairment of digital intangible assets | ||||||||
| Gain on digital intangible assets | ( | ) | - | |||||
| Changes in operating assets and liabilities: | ||||||||
| Digital assets and stable coins | ( | ) | ( | ) | ||||
| Digital intangible assets | - | ( | ) | |||||
| Right-of-use assets | ||||||||
| Deferred revenue | ( | ) | ||||||
| Lease liabilities | ( | ) | ( | ) | ||||
| Other current assets | ( | ) | ||||||
| Other non-current assets | ( | ) | ||||||
| Accounts receivable | ( | ) | ( | ) | ||||
| Accounts payable | ||||||||
| Other payables and accrued liabilities | ( | ) | ||||||
| Net investment in lease | ||||||||
| Other long-term liabilities | ( | ) | ||||||
| Income tax payable | ( | ) | ( | ) | ||||
| Deferred tax liabilities | ||||||||
| Net Cash Provided by (Used in) Operating Activities | ( | ) | ||||||
| Cash Flows from Investing Activities: | ||||||||
| Purchases of and deposits made for property, plant and equipment | ( | ) | ( | ) | ||||
| Investment in equity securities | ( | ) | ( | ) | ||||
| Proceeds from disposal of property, plant and equipment | ||||||||
| Proceeds from disposal of digital assets | - | |||||||
| Net Cash Used in Investing Activities | ( | ) | ( | ) | ||||
| Cash Flows from Financing Activities: | ||||||||
| Net proceeds from issuance of ordinary shares for public offering | - | |||||||
| Net proceeds from IPO over-allotment option exercise | - | |||||||
| Net proceeds from subsidiary IPO | - | |||||||
| Net proceeds from issuance of ordinary shares/registered direct offering | - | |||||||
| Net proceeds from issuance of ordinary shares/At-the-market offering | ||||||||
| Net proceeds from issuance of convertible debts | - | |||||||
| Net proceeds from issuance of debts | - | |||||||
| Purchase of zero-strike call option | ( | ) | - | |||||
| Payment of dividends | ( | ) | ( | ) | ||||
| Repayment of debt | ( | ) | - | |||||
| Repayment of convertible notes in induced conversion | ( | ) | - | |||||
| Repayment of finance lease liabilities | ( | ) | - | |||||
| Net Cash Provided by Financing Activities | ||||||||
| Net increase in cash, cash equivalents and restricted cash | ||||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | ||||||||
| Cash, cash equivalents and restricted cash, beginning of period | ||||||||
| Cash, cash equivalents and restricted cash, end of period | $ | $ | ||||||
| Supplemental Cash Flow Information | ||||||||
| Cash paid for interest expense | $ | $ | - | |||||
| Cash paid for income taxes, net of (refunds) | $ | $ | ||||||
| Non-cash Transactions of Investing and Financing Activities | ||||||||
| Right of use assets exchanged for operating lease liabilities | $ | $ | ||||||
| Reclassification of deposits to property, plant and equipment | $ | $ | ||||||
| Issuance of subsidiary ordinary shares in connection with non-cash equity transactions | $ | $ | ||||||
| Net transfer from net investment in sales-type leases to property and equipment | $ | $ | ||||||
| Construction in progress included in other payables and accrued liabilities | $ | $ | - | |||||
| Debt issuance costs included in other payables and accrued liabilities | $ | $ | - | |||||
| Unamortized issuance costs on repurchase notes included in additional paid-in capital | $ | $ | - | |||||
| Ordinary shares issued in induced conversion of convertible notes | $ | $ | - | |||||
| Digital assets, pledged as collateral | $ | $ | - | |||||
| ETH exchanged for LsETH | $ | $ | - | |||||
| Extinguishment of financing lease by acquiring underlying assets | $ | $ | - | |||||
Reconciliation of cash, cash equivalents and restricted cash
| September 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| Cash and cash equivalents | $ | $ | ||||||
| Restricted cash | ||||||||
| Cash, cash equivalents and restricted cash | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
5
BIT DIGITAL, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. ORGANIZATION AND PRINCIPAL ACTIVITIES
Bit Digital, Inc. (“BTBT” or the “Company”), is a holding company incorporated on
On August 15, 2024, WhiteFiber, Inc. (f/k/a Celer, Inc.) (“WhiteFiber”) was incorporated to support the Company’s generative artificial intelligence workstreams. WhiteFiber was
On August 8, 2025, WhiteFiber completed its initial public offering (“IPO”) of its ordinary shares. Prior to the consummation of the IPO, the Company entered into a contribution agreement (the “Contribution Agreement”) with WhiteFiber, pursuant to which the Company contributed (the “Contribution”) its HPC business through the transfer of
On November 28, 2025, the Company acquired all the shares of Financière Louis David (“FLD”), a France-based company structured as a Société par Actions Simplifiée (SAS), is a holding/management company that primarily engages in business consulting and management advisory activities. FLD is the general partner (associé commandité) of Financière Marjos SCA (“Financière Marjos” or “FM”), a France-based company listed on the Euronext Paris stock exchange (Euronext: FINM), is a holding and investment company that creates, acquires, and manages diverse businesses and provides financial and administrative services through subsidiaries and holdings. FLD then held
6
The accompanying unaudited condensed consolidated financial statements reflect the activities of the Company and each of the following entities:
| Name | Background | Ownership | |||
| Bit Digital USA, Inc. (“BT USA”) | ● | ||||
| ● | Incorporated on | ||||
| ● | |||||
| Bit Digital Capital, Inc. (“BT Capital”) | ● | ||||
| ● | Incorporated on | ||||
| ● | |||||
| Bit Digital Canada, Inc. (“BT Canada”) | ● | ||||
| ● | Incorporated on | ||||
| ● | |||||
| ● | |||||
| Bit Digital Hong Kong Limited (“BT HK”) | ● | ||||
| ● | Acquired on | ||||
| ● | |||||
| Bit Digital Strategies Limited (“BT Strategies”) | ● | ||||
| ● | Incorporated on | ||||
| ● | |||||
| Bit Digital Singapore Pte. Ltd. (“BT Singapore”) | ● | ||||
| ● | Incorporated on | ||||
| ● | |||||
| Bit Digital Europe Holding | ● | ||||
| (formerly known as Financière Louis David (“FLD”)) | ● | Incorporated on | |||
| Financière Marjos SCA | ● | ||||
| (“Financière Marjos” or “FM”) | ● | Incorporated on | |||
| WhiteFiber, Inc. (f/k/a Celer, Inc.) | ● | ||||
| (“WhiteFiber”) | ● | Incorporated on | |||
| ● | |||||
| (1) |
7
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation and principles of consolidation
The interim unaudited condensed consolidated financial statements are prepared and presented in accordance with accounting principles generally accepted in the United States (“US GAAP”). Unless otherwise indicated, amounts are stated in thousands of U.S. dollars, except for share, per share data, miner quantities; digital assets quantities and prices.
The unaudited condensed consolidated financial information as of September 30, 2026 and for the three and nine months ended September 30, 2026 and 2025 has been prepared without audit, pursuant to the rules and regulations of the SEC and pursuant to Regulation S-X. Certain information and footnote disclosures, which are normally included in annual financial statements prepared in accordance with US GAAP, have been omitted pursuant to those rules and regulations. The unaudited interim financial information should be read in conjunction with the audited financial statements and the notes thereto, included in the Form 10-K for the fiscal year ended December 31, 2025, which was filed with the SEC on March 27, 2026.
In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments, which are necessary for a fair presentation of financial results for the interim periods presented. The Company believes that the disclosures are adequate to make the information presented not misleading. The accompanying unaudited condensed consolidated financial statements have been prepared using the same accounting policies as used in the preparation of the Company’s consolidated financial statements for the year ended December 31, 2025. The results of operations for the three and nine months ended September 30, 2026, and 2025 are not necessarily indicative of the results for the full years.
Initial Public Offering of WhiteFiber
On August 8, 2025, WhiteFiber closed its initial public offering (IPO) of
On September 2, 2025, the Underwriters fully exercised their option to purchase the additional
Following the IPO (including the underwriters’ exercise of their option to purchase additional ordinary shares), the Company owned approximately
Use of estimates
In preparing the condensed consolidated financial statements in conformity with U.S. GAAP, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates are based on information as of the date of the condensed consolidated financial statements. Significant estimates required to be made by management include, but are not limited to, the valuation of digital assets and other current assets, useful lives of property, plant, and equipment, impairment of long-lived assets, intangible assets and goodwill, valuation of assets and liabilities acquired in business combinations, provision necessary for contingent liabilities, valuation of the embedded conversion derivative liability and realization of deferred tax assets. Actual results could differ from those estimates.
8
Fair value of financial instruments
ASC 825-10 requires certain disclosures regarding the fair value of financial instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:
| ● | Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. |
| ● | Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, quoted market prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable and inputs derived from or corroborated by observable market data. |
| ● | Level 3 - inputs to the valuation methodology are unobservable. |
Fair value of digital assets is based on Level 1 inputs as these were based on observable quoted prices in the Company’s principal market for identical assets. The carrying amounts of the Company’s other financial instruments, including cash and cash equivalents, restricted cash, loans receivable, deposits, accounts receivable, other receivables, accounts payable, and other payables, approximate their fair values because of the short-term nature of these assets and liabilities. Non-financial assets, such as intangible assets, right-of-use assets, and property, plant and equipment, are adjusted to fair value when there is an indication of impairment and the carrying amount exceeds the asset’s projected undiscounted cash flows. These assets are recorded at fair value only upon recognition of an impairment charge.
Fair value of the Company’s convertible notes payable was estimated using quoted market prices for the notes in markets that are not considered active, which represent Level 2 measurements within the fair value hierarchy.
Fair value of the embedded conversion feature at issuance of the convertible notes and each reporting period was estimated based on significant inputs that are unobservable in the market, which represent Level 3 measurements within the fair value hierarchy.
Cash and cash equivalents
Cash includes cash on hand and demand deposits in accounts maintained with commercial banks. The Company considers all highly liquid investment instruments with an original maturity of three months or less from the date of purchase to be cash equivalents.
Restricted cash
Restricted cash represents cash balances that support an outstanding letter of credit to third parties related to security deposits and other purposes and are restricted from withdrawal.
USDC
USD Coin (“USDC”) is accounted for as a financial instrument that can be redeemed one USDC for one U.S. dollar on demand from the issuer. While not accounted for as cash or cash equivalents, we treat our USDC holdings as a liquidity resource.
9
Accounts receivable, net
Accounts receivable consist of amounts due from our customers. Receivables are recorded at the invoiced amount less current expected credit losses for any potentially uncollectable accounts under the current expected credit loss (“CECL”) impairment model and presents the net amount of the financial instrument expected to be collected. The CECL impairment model requires an estimate of expected credit losses, measured over the contractual life of an instrument, that considers forecasts of future economic conditions in addition to information about past events and current conditions. In accordance with ASC 326, Measurement of Credit Losses on Financial Instruments (“ASC 326”), the Company evaluates the collectability of outstanding accounts receivable balances to determine current expected credit losses that reflects its best estimate of the lifetime expected credit losses. Uncollectible accounts are written off against the current expected credit losses when collection does not appear probable.
In determining the amount of the current expected credit losses, the Company considers historical collection history based on past due status, the current aging of receivables, customer-specific credit risk factors, including their current financial condition, current market conditions, and probable future economic conditions which inform adjustments to historical loss patterns. Credit loss expense, inclusive of credit loss expense on all categories of financial assets, is recorded within General and administrative expenses in the condensed consolidated statements of operations.
Digital assets holdings
The Company’s digital assets primarily include bitcoin and ETH. Digital assets are included in non-current assets on consolidated balance sheets due to the Company’s intent to retain and hold the majority of its digital assets on a long-term basis. The Company distinguishes between digital assets which fall within the scope of ASC 350-60 and those which do not. The Company refers to digital assets which fall within the scope of ASC 350-60 (e.g., bitcoin and ETH) as “crypto assets.” Digital assets which do not fall within the scope of ASC 350-60, Accounting for and Disclosure of Crypto Assets, are referred to as “digital intangible assets.”
Digital intangible assets comprised of LsETH that are intangible assets outside the scope of ASC 350-60. A receipt token, in general and by design, entitles the holder to redeem the crypto intangible asset(s) for which it was exchanged. Therefore, it fails the ‘other goods and services criterion’ in paragraph 350-60-15-1(b) and thus is outside the scope of Subtopic 350-60. These digital intangible assets are recorded at cost, less impairment within digital intangible assets on the consolidated balance sheets in accordance with ASC 350-30. The Company tests digital intangible assets for impairment quarterly and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. The test for impairment consists of a comparison of the fair value of the digital intangible assets with their carrying amounts. Refer to Note 5, Digital Assets Holdings for additional information.
Digital assets purchased are recorded at cost and digital assets awarded to the Company through its mining activities and staking activities are accounted for in accordance with the Company’s revenue recognition policy disclosed below.
Effective January 1, 2024, the Company early adopted ASU 2023-08, which requires entities to measure certain cryptocurrencies at fair value, with changes in fair value recorded in net income in each reporting period. The Company’s digital assets are within the scope of ASU 2023-08 and the transition guidance requires a cumulative-effect adjustment as of the beginning of the current fiscal year for any difference between the carrying amount of the Company’s digital assets and fair value.
10
ASC 820 defines “principal market” as the market with the greatest volume and level of activity for the asset or liability. The determination of the principal market (and, as a result, the market participants in the principal market) is made from the perspective of the reporting entity. The digital assets held by the Company are traded on a number of active markets globally. The Company uses both Galaxy and Amber Group’s OTC desk to buy and sell digital assets, including transactions involving U.S. dollars or exchanges between different types of digital assets. Prior to April 1, 2025, the Company considered CoinMarketCap to be its principal market. Effective April 1, 2025, the Company determined that Coinbase is its principal market as it provides the most reliable and greatest volume and level of activity for bitcoin and ETH for which the Company can access.
The Company recognizes mining revenue by utilizing the spot price of Bitcoin determined using Coinbase at 0:00:00 UTC on the date of contract inception. The Company recognizes staking revenue at the fair value of the ETH received at contract inception, measured using quoted prices on the Coinbase exchange.
Purchases and sales of digital assets by the Company are included within investing activities on the accompanying consolidated statements of cash flows and digital assets awarded to the Company through its mining activities and staking activities are included within operating activities on the accompanying consolidated statements of cash flows. Deposits of ETH into liquid staking, receipt of ETH from unstaking and redemption of receipt tokens, are presented as within non-cash investing activities in the condensed statements of cash flows. The changes of digital assets are included within operating activities in the accompanying consolidated statements of cash flows. After adopting ASU 2023-08, changes in fair value and realized gains or losses are now reported as “gains (losses) on digital assets” in the consolidated statements of operations. Prior to this adoption, realized gains or losses were reported as “realized gains (losses) on exchange of digital assets” in the consolidated statements of operations. The Company accounts for its gains or losses in accordance with the first-in first-out method of accounting.
Digital Asset Collateral Receivable
The Digital Asset Collateral Receivable represents the Company’s contractual right to receive an equivalent quantity and type of digital assets pledged as collateral under borrowing arrangements in which the counterparty has the contractual right to sell, pledge, rehypothecate, assign, invest, use, commingle or otherwise dispose of the pledged digital assets during the term of the arrangement. Upon transfer of the collateral, the Company derecognizes the pledged digital assets as control has transferred to the counterparty and recognizes a Digital Asset Collateral Receivable representing its contractual right to receive fungible digital assets of the same type upon settlement of the related borrowing arrangement.
The Digital Asset Collateral Receivable is initially measured at the fair value of the digital assets transferred as collateral on the transfer date. Any difference between the carrying amount of the transferred digital assets and the initial measurement of the receivable is recognized in the consolidated statements of operations as an impairment loss or realized gain on transfer, as applicable. Thereafter, the Digital Asset Collateral Receivable is measured at amortized cost. The value and activity relating to the Digital Asset Collateral Receivable are disclosed in Note 6 – Digital Asset Collateral Receivable.
The Digital Asset Collateral Receivable is classified as current or non-current based on the expected timing of settlement under the related borrowing arrangement. For borrowing arrangements that are repayable on demand or otherwise expected to be settled within twelve months, the Digital Asset Collateral Receivable is classified as a current asset.
At inception and throughout the term of the arrangement, the Company evaluates the collectability of the Digital Asset Collateral Receivable in accordance with ASC 326, Financial Instruments—Credit Losses. The Digital Asset Collateral Receivable is presented net of any allowance for expected credit losses. The Company applies the current expected credit loss (“CECL”) model and estimates lifetime expected credit losses by considering the creditworthiness of the counterparty, the contractual terms of the borrowing arrangement, current economic conditions, reasonable and supportable forecasts, and other qualitative and quantitative factors relevant to the collectability of the receivable. Based on these assessments, management records an allowance for expected credit losses when necessary. For the periods presented, no allowance for expected credit losses was considered necessary.
Deposits for property, plant, and equipment
The deposits for property, plant, and equipment (“PP&E”) represent advance payments for purchases of property, plant and equipment. The Company initially recognizes deposits for PP&E when cash is advanced to suppliers. Subsequently, the Company derecognizes and reclassifies deposits for PP&E to PP&E when control is transferred to and obtained by the Company.
11
Below is the roll forward of the balance of deposits for PP&E for the nine months ended September 30, 2026 and for the year ended December 31, 2025 respectively.
| September 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| Opening balance | $ | $ | ||||||
| Reclassification to PP&E | ( | ) | ( | ) | ||||
| Addition of deposits for PP&E | ||||||||
| Ending balance | $ | $ | ||||||
Property, plant, and equipment, net
Property, plant, and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the assets or declining-balance method. Direct costs related to developing or obtaining software for internal use are capitalized as property, plant, and equipment. Capitalized software costs are amortized over the software’s useful life when the software is placed in service.
| Estimated Useful Life | |||
| Digital asset miners | |||
| Cloud service equipment | |||
| Colocation service equipment | |||
| Building | |||
| Leasehold improvements | |||
| Purchased and internally developed software | |||
| Vehicle | |||
| Other property and equipment |
Land acquired by the Company has an unlimited useful life and therefore is not depreciated.
Impairment of long-lived assets
Management reviews long-lived assets, including finite-lived intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.
Goodwill
Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in a business combination. Goodwill is not subject to amortization, and instead, assessed for impairment annually at the end of each fiscal year, or more frequently when events or changes in circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount in accordance with ASC 350 - Intangibles - Goodwill and Other.
The impairment assessment involves an option to first assess qualitative factors to determine whether events or circumstances exist that lead to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the qualitative assessment is not performed, or after assessing the totality of the events or circumstances, we determine it is more likely than not that the fair value of a reporting unit is less than its carrying amount, a quantitative assessment for potential impairment is performed.
The quantitative goodwill impairment test is performed by comparing the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill is not impaired. An impairment loss is recognized for any excess of the carrying amount of the reporting unit over its fair value up to the amount of goodwill allocated to the reporting unit.
12
Finite-lived intangible assets
Intangible assets are recorded at cost less any accumulated amortization and any accumulated impairment losses. Intangible assets acquired through business combinations are measured at fair value at the acquisition date.
Intangible assets with finite lives are comprised of customer relationships and are amortized on a straight-line basis over their estimated useful lives. The Company assesses the appropriateness of finite-lived classification at least annually. Additionally, the carrying value and remaining useful lives of finite-lived assets are reviewed annually to identify any circumstances that may indicate potential impairment or the need for a revision to the amortization period. A finite-lived intangible asset is considered to be impaired if its carrying value exceeds the estimated future undiscounted cash flows expected to be generated from it. We apply judgment in selecting the assumptions used in the estimated future undiscounted cash flow analysis. Impairment is measured by the amount that the carrying value exceeds fair value. The useful life of customer relationships is
Business combinations
The Company accounts for business combinations under the acquisition method of accounting in accordance with ASC 805 - Business Combinations, by recognizing the identifiable tangible and intangible assets acquired and liabilities assumed, measured at the acquisition date fair value. The determination of fair value involves assumptions, estimates, and judgments. The initial allocation of the purchase price is considered preliminary and therefore subject to change until the end of the measurement period (up to one year from the acquisition date). Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net assets acquired.
Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred.
Investment securities
As of September 30, 2026 and December 31, 2025, investment securities represent the Company’s investments in three funds, a privately held company via a simple agreement for future equity (“SAFE”), four privately held companies, and a publicly traded company over which the Company neither has control nor significant influence through investments in ordinary shares or preferred shares.
Investment in equity method investee
In accordance with ASC 323, Investments - Equity Method and Joint Ventures, the Company accounts for the investment in one privately held company using equity method, because the Company has significant influence but does not own a majority equity interest or otherwise control over the equity investee.
Under the equity method, the Company initially records its investment at cost and prospectively recognizes its proportionate share of each equity investee’s net income or loss into its consolidated statements of operations. When the Company’s share of losses in the equity investee equals or exceeds its interest in the equity investee, the Company does not recognize further losses, unless the Company has incurred obligations or made payments or guarantees on behalf of the equity investee.
The Company continually reviews its investment in the equity investee to determine whether a decline in fair value below the carrying value is other-than-temporary. The primary factors the Company considers in its determination include the financial condition, operating performance and the prospects of the equity investee; other company specific information such as recent financing rounds; the geographic region, market and industry in which the equity investee operates; and the length of time that the fair value of the investment is below its carrying value. If the decline in fair value is deemed to be other-than-temporary, the carrying value of the equity investee is written down to fair value.
Investment in funds
Equity securities not accounted for using the equity method are carried at fair value with unrealized gains and losses recorded in the consolidated income statements, according to ASC 321, Investments - Equity Securities. As a practical expedient, the Company uses Net Asset Value (“NAV”) or its equivalent to measure the fair value of the investment in the fund. NAV is primarily determined based on information provided by the fund administrator.
13
Investment in privately held company
Equity securities not accounted for using the equity method are carried at fair value with unrealized gains and losses recorded in the consolidated income statements, according to ASC 321, Investments - Equity Securities. The Company elected to record the equity investments in privately held companies using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer.
Equity investments in privately held companies accounted for using the measurement alternative are subject to periodic impairment reviews. The Company’s impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of these equity securities. In computing realized gains and losses on equity securities, the Company calculates cost based on amounts paid using the average cost method. Dividend income is recognized when the right to receive the payment is established.
Investment in a publicly traded company
The Company’s equity investments consist of minority interests in a publicly traded company over which the Company does not have significant influence. These investments are classified as equity securities and are measured at fair value in accordance with ASC 321, Investments — Equity Securities.
Equity securities with readily determinable fair values are measured at fair value, with changes in fair value recognized in earnings and presented within other income, net in the consolidated statements of operations. The fair value of publicly traded equity securities is determined using quoted market prices in active markets and is classified as Level 1 inputs within the fair value hierarchy.
Investment in SAFE
SAFE investments provide the Company with the right to participate in future equity financing of preferred stock. The Company accounted for this investment under ASC 320, Investments - Debt Securities and elected the fair value option for the SAFE investment under ASC 825, Financial Instruments, which requires financial instruments to be remeasured to fair value each reporting period, with changes in fair value recorded in the condensed consolidated statements of operations. The fair value estimate includes significant inputs not observable in the market, which represents a Level 3 measurement within the fair value hierarchy.
Investment in Innovation Fund/Digital assets held in fund
On October 1, 2023, the Company made an investment of
The Fund qualified and operated as an investment company for accounting purposes pursuant to the accounting and reporting guidance under ASC 946, “Financial Services – Investment Companies” (“ASC 946”), which requires fair value measurement of the Fund. The Company retains the Fund’s investment company specific accounting principles under ASC 946 upon consolidation. The digital assets held by the Fund were traded on a number of active markets globally. A fair value measurement under ASC 820, “Fair Value Measurement” (“ASC 820”) for an asset assumes that the asset is exchanged in an orderly transaction between market participants either in the principal market for the asset or, in the absence of a principal market, the most advantageous market for the asset (ASC 820-10-35-5). The fair value of the assets within the Fund was primarily determined using the price from CoinMarketCap. Any changes in the fair value of the assets were recorded in Other income (expense), net in the consolidated statements of operations.
On July 1, 2024, the Company entered into a share purchase agreement with Pleasanton Ventures Limited (“Pleasanton Ventures”) for the disposition of Bit Digital Innovation Master Fund SPC Ltd and Bit Digital Investment Management Limited. Upon the disposition, the Company no longer has a controlling financial interest in the Fund and therefore deconsolidated the Fund in accordance with ASC 810 – “Consolidation” (“ASC 810”). The Company did not record any gain or loss upon deconsolidation as the digital assets in the Fund were measured at fair value. Subsequently, the investment in the Fund is included under the caption “Investment securities” as Investment in Innovation Fund. Refer to Note 10. Investment Securities for more information.
Leases
Leases as Lessee
The Company determines whether an arrangement contains a lease at the inception of the arrangement. If a lease is determined to exist, the term of such lease is assessed based on the date on which the underlying asset is made available for the Company’s use by the lessor. The Company’s assessment of the lease term reflects the non-cancellable term of the lease, inclusive of any rent-free periods and/or periods covered by early-termination options which the Company is reasonably certain of not exercising, as well as periods covered by renewal options which the Company is reasonably certain of exercising. The Company also determines lease classification as either operating or finance at lease commencement, which governs the pattern of expense recognition and the presentation reflected in the condensed consolidated statements of operations over the lease term.
14
For leases with a term exceeding 12 months, a lease liability is recorded on the Company’s condensed consolidated balance sheet at lease commencement reflecting the present value of its fixed minimum payment obligations over the lease term, and the purchase price if the Company is reasonably certain to exercise a purchase option. A corresponding lease right-of-use asset equal to the initial lease liability is also recorded, adjusted for any prepayment and/or initial direct costs incurred in connection with execution of the lease and reduced by any lease incentives received. For purposes of measuring the present value of its fixed payment obligations for a given lease, the Company uses its incremental borrowing rate, determined based on information available at lease commencement, as rates implicit in its leasing arrangements are typically not readily determinable. The Company’s incremental borrowing rate reflects the rate it would pay to borrow on a secured basis and incorporates the term and economic environment of the associated lease. Variable lease costs are recognized in the period in which the obligation for those payments is incurred and not included in the measurement of right-of-use assets and lease liabilities.
For the Company’s operating leases, fixed lease payments are recognized as lease expense on a straight-line basis over the lease term. For leases with a term of 12 months or less, any fixed lease payments are recognized on a straight-line basis over the lease term and are not recognized on the Company’s condensed consolidated balance sheet as an accounting policy election. Leases qualifying for the short-term lease exception were insignificant.
For finance leases where the Company is the lessee, the Company recognizes a right-of-use assets and a corresponding lease liability at lease commencement, measured in a manner consistent with operating leases. Subsequently, fixed lease payments are recognized as amortization of the right-of-use asset and interest expense is recognized on the outstanding lease liability using the effective interest method. Finance lease right-of-use assets are amortized into depreciation and amortization expense on a straight-line basis over the lease term or, if the lease transfers ownership of the underlying asset to the Company, the life of the leased asset.
Leases as Lessor
At contract inception, the Company determines whether an arrangement contains a lease, which exists when the customer obtains the right to control the use of an identified asset, such as a dedicated data hall, for a period of time in exchange for consideration. In making this determination, the Company considers whether it has a substantive right to substitute alternative space. Colocation arrangements that do not convey such a right are accounted for under ASC 606.
The lease term includes the noncancellable period and any periods covered by options the customer is reasonably certain to exercise to extend, or not to exercise to terminate, the lease. Lease commencement occurs when the Company makes the underlying asset available for use by the customer, which may precede the contractual billing start date. The Company’s data center leases are classified as operating leases.
For its dedicated data center leases, the Company has elected the lessor practical expedient to combine facility operations and maintenance services with the associated lease component and accounts for the combined component under ASC 842 because the lease component is predominant. Electricity and remote hands services are accounted for separately under ASC 606. Fixed consideration is allocated between lease and nonlease components based on relative standalone selling prices, and variable consideration for electricity and remote hands services is allocated entirely to those services.
For arrangements in which the Company acts as lessor, leases are classified at commencement as sales-type, direct financing or operating leases. Operating lease classification is applied when the criteria for the other classifications are not met, including certain arrangements involving variable lease payments. Lease commencement occurs when the underlying asset becomes available for customer use. For sales-type leases where the Company is the lessor, the Company recognizes a net investment in lease, which comprises the present value of the future lease payments and any unguaranteed residual value. Interest income is recognized over the lease term at a constant periodic discount rate on the remaining balance of the lease net investment using the rate implicit in the lease and is included in “Revenues.” Sales-type leases result in the recognition of gain or loss at the commencement of the lease, which will be recorded in “Other income, net.”
Operating lease revenue is recognized over the lease term beginning at commencement. Advance payments are recorded as deferred lease revenue and recognized over the applicable revenue recognition period. The Company recognizes lease payments in income over the lease term on a straight-line basis and is included in “Revenues.” Differences between amounts billed or received and straight-line lease income are recorded as deferred lease revenue or a straight-line rent receivable. Variable lease payments are recognized as income in the period in which they are earned. Initial direct costs are deferred and recognized as expense over the lease term. Assets subject to operating leases remain in property, plant and equipment and continue to be depreciated.
For operating subleases where the Company is the lessor, the Company recognizes lease payments in income over the lease term on a straight-line basis and is included in “Other income, net.”
Debt
Notes and Loans Payable (short-term and long-term debt)
Notes and loans payable are presented as short-term and long-term debt in the consolidated balance sheet and recognized initially at the amount of proceeds received, net of related debt discount and debt issuance costs, and are subsequently measured at amortized cost using the effective interest method. Interest expense is recognized in the condensed consolidated statements of operations over the term of the related debt. Notes and loans payable are classified as current or long-term debt liabilities based on their contractual maturities, or earlier if a default, cross-default, or other contractual provision entitles the lender to accelerate repayment within twelve months of the balance sheet date.
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Convertible notes payable
The Company accounts for its convertible note under ASC 470-20, Debt with Conversion and Other Options and ASC 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity and/or ASC 815, depending on the specific terms of the debt agreement.
For convertible notes for which the embedded conversion feature is determined not to be clearly and closely related to the debt host and does not qualify for the scope exception under ASC 815-40, the Company bifurcates the embedded conversion feature and accounts for it separately as a derivative liability. Such derivative liabilities are initially measured at fair value, with subsequent changes in fair value recognized in the condensed consolidated statements of operations. The remaining proceeds are allocated to the debt host, which is recorded as convertible notes, net of debt discount and issuance costs.
For convertible notes for which the embedded conversion feature is determined to be clearly and closely related to the debt host and does qualify for the scope exception under ASC 815-40, the Company records the entire convertible notes at face value net of debt issuance costs.
If any of the conditions to the convertibility of the convertible notes are satisfied, or the convertible notes become due within one year, then the Company may be required under applicable accounting standards to reclassify the carrying value of the convertible senior notes as a current, rather than a long-term liability.
Debt issuance costs related to the convertible notes were capitalized and recorded as a contra-liability and are presented net against the balance of the convertible notes on the condensed consolidated balance sheet. Debt issuance costs consist of underwriting, legal and other direct costs related to the issuance of the convertible notes and are amortized to interest expense over the term of the convertible notes using the effective interest method.
Zero-strike call
The Company accounts for the zero-strike call option as either equity instruments or liabilities in accordance with ASC 480 and/or derivative liabilities in accordance ASC 815, depending on the specific terms of the agreement. The Company evaluates the terms of such instruments to determine whether they are indexed to the Company’s own stock and qualify for equity classification under ASC 815-40. To the extent these criteria are met, the Zero-strike call option is equity-classified, which is not remeasured each reporting period and is recorded as a reduction to additional paid-in-capital within shareholders’ equity when purchased. The transaction is accounted for separately from the convertible notes and does not impact the accounting for convertible notes.
Collateralized borrowings
Collateralized borrowings represent financing arrangements under which the Company obtains funding secured by its liquid staked ETH (“LsETH”). Upon inception of a collateralized borrowing arrangement, the Company recognizes a loan payable equal to the proceeds received, net of any applicable debt issuance costs.
Subsequent to initial recognition, the loan payable is measured at amortized cost using the effective interest method. Interest expense, including the amortization of any debt discount or debt issuance costs, is recognized over the period the borrowing is outstanding. Accrued but unpaid interest is recognized as interest payable until settlement.
The Company’s collateralized borrowings are secured by LsETH pledged to the lender. When the Company determines that control of the pledged collateral has transferred to the lender, the pledged LsETH is derecognized and a collateral receivable is recognized in accordance with the Company’s accounting policy for pledged digital assets. Changes in the accounting for the pledged collateral do not affect the recognition, measurement or presentation of the related loan payable.
The Company’s collateralized borrowing arrangements may require the Company to maintain collateral at specified contractual collateralization levels. Accordingly, the Company may be required to pledge additional collateral or may receive the return of previously pledged collateral based on changes in the fair value of the pledged digital assets.
The Company’s collateralized borrowings are evergreen facilities that may be called by the lender upon seven days’ notice or repaid by the Company at any time in accordance with the applicable loan agreements. Because the Company does not have an unconditional right to defer settlement of these borrowings for at least one year after the balance sheet date, the related loan payable is classified as a current liability in the consolidated balance sheets.
Revenue recognition
The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”). The Company recognizes revenue when it transfers its goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange.
The Company also recognizes lease income from arrangements accounted for as operating leases in accordance with ASC 842, Leases (“ASC 842”), generally on a straight-line basis over the applicable lease term.
Refer to Note 3, Revenue, and Note 8, Leases, for additional information.
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Contract costs
Capitalized contract costs represent the costs directly related and incremental to the origination of new contracts, including commissions that are incurred directly related to obtaining customer contracts. We amortize the deferred contract costs on a straight-line basis over the expected period of benefit. These amounts are included in the accompanying condensed consolidated balance sheets, with the capitalized costs to be amortized to commission expense over the expected period of benefit included in Other current assets and non-current assets and commission expense payable included in Other current liabilities and Other long-term liabilities.
Deferred revenue
Deferred revenue primarily pertains to prepayments received from customers for services that have not yet commenced as of September 30, 2026. Deferred revenues are recognized as revenue when recognition criteria have been met.
Remaining performance obligation
Remaining performance obligations represent the transaction price of contracts for work that have not yet been performed. The amount represents estimated revenue expected to be recognized in the future related to the unsatisfied portion of the performance obligation.
Cost of revenue
The Company’s cost of revenue consists primarily of (i) direct production costs related to mining operations, including electricity costs, profit-sharing fees/variable performance fees and/or other relevant costs paid to our hosting facilities, (ii) direct production costs related to our cloud services, including electricity costs, data center lease costs, data center employees’ wage expenses and other relevant costs, (iii) direct production costs related to our colocation services, including electricity costs, lease costs, and other relevant costs, and (iv) direct costs related to ETH staking business, including service fees payable to the service provider.
Cost of revenue excludes depreciation expenses, which are separately stated in the Company’s condensed consolidated statements of operations.
Foreign currency
Accounts expressed in foreign currencies are translated into U.S. dollars. Functional currency assets and liabilities are translated into U.S. dollars generally using rates of exchange prevailing at the balance sheet date of each respective subsidiary and the related translation adjustments are recorded as a separate component of accumulated other comprehensive income, net of any related taxes, in total shareholders’ equity. Income statement accounts expressed in functional currencies are translated using average exchange rates during the period. Functional currencies are generally the currencies of the local operating environment. Financial statement accounts expressed in currencies other than the functional currency of a consolidated entity are remeasured into that entity’s functional currency resulting in exchange gains or losses recorded in other income (expense), net.
Operating segments
Operating segments are defined as components of an entity for which discrete financial information is available that is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources to an individual segment and in assessing performance.
Income taxes
We account for current and deferred income taxes in accordance with the authoritative guidance, which requires that the income tax impact to be recognized in the period in which the law is enacted. Current income tax expense represents taxes paid or payable for the current period. Deferred tax assets and liabilities are recognized using enacted tax rates for the future tax impact of temporary differences between the financial statement and tax bases of recorded assets and liabilities. A valuation allowance is recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized based on historical and projected future taxable income over the periods in which the temporary differences are expected to be recovered or settled on each jurisdiction.
In accordance with the authoritative guidance on accounting for uncertainty in income taxes, we recognize liabilities for uncertain tax positions based on the two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained in audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than
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Earnings (loss) per share
Basic earnings (loss) per share is computed by dividing net income (loss) attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares or resulted in the issuance of ordinary share participating in the earnings of the entity.
Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares. Potentially dilutive securities include, but are not limited to, convertible debt instruments, share-based compensation awards, warrants, and other equity-linked instruments.
The Company applies the treasury stock method or the if-converted method, as applicable, to determine the dilutive effect of these instruments.
For periods in which the Company reports a net loss, all potentially dilutive securities are excluded from the computation of diluted loss per share, as their inclusion would be anti-dilutive. In addition, potentially dilutive securities are excluded from the calculation of diluted earnings per share when their effect would be anti-dilutive.
Commitments and contingencies
In the normal course of business, the Company is subject to contingencies, such as legal proceedings and claims arising out of its business, which cover a wide range of matters. Liabilities for contingencies are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.
If the assessment of a contingency indicates that it is probable that a material loss is incurred and the amount of the liability can be estimated, then the estimated liability is accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed.
Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed.
The Company may also enter into contractual arrangements that result in commitments, including purchase obligations. In addition, the Company may be subject to contingent consideration obligations related to asset acquisitions, which involve potential future payments contingent upon the achievement of specified conditions or milestones.
Share-based compensation
The Company expenses stock-based compensation to employees and non-employees over the requisite service period based on the grant-date fair value of the awards. The Company estimates the fair value of stock option grants using the Black-Scholes option pricing model and the assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. These assumptions are the expected stock volatility, the risk-free interest rate, the expected life of the option, and the dividend yield on the underlying stock. Expected volatility is calculated based on the historical volatility of the Company’s ordinary shares over the expected term of the option. Risk-free interest rates are calculated based on risk–free rates for the appropriate term. The Company has elected to account for forfeitures of awards as they occur.
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The Company has granted RSUs to certain employees and non-employees. Some of the RSUs contain a performance condition, and vesting is determined based on achievement of a performance metric. Compensation expense is recognized on a straight-line basis over the service period based on the expected attainment of a performance metric. At each reporting period, the Company reassesses the probability of the achievement of the performance metric, and any increase or decrease in share-based compensation expense resulting from an adjustment in the number of shares expected to vest is treated as a cumulative catch-up in the period of adjustment.
Treasury stock
The Company accounts for treasury stocks using the cost method. Under this method, the cost incurred to purchase the shares is recorded in the treasury stocks account on the consolidated balance sheets.
The Company treats shares withheld for tax purposes on behalf of employees in connection with the vesting of restricted share grants as ordinary share repurchases because they reduce the number of shares that would have been issued upon vesting.
Reclassification
Certain items in the financial statements of the comparative period have been reclassified to conform to the financial statements for the current period. The reclassification has no impact on the total assets and total liabilities as of September 30, 2026 or on the statements of operations for the three and nine months ended September 30, 2026.
Recent accounting pronouncements
The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company’s financial reporting, the Company undertakes a study to determine the consequences of the change to its condensed consolidated financial statements and assures that there are proper controls in place to ascertain that the Company’s condensed consolidated financial statements properly reflect the change.
In November 2024, the FASB issued ASU 2024-04, Debt—Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments, which clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as induced conversions. The Company adopted this guidance effective January 1, 2026. During the third quarter of 2026, the Company applied this guidance in accounting for the induced conversion of a portion of WhiteFiber’s
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”). ASU 2024-03 requires, in the notes to the financial statements, disclosures of specified information about certain costs and expenses included in income statement captions. In January 2025, the FASB issued ASU 2025-01, which clarified the effective date of ASU 2024-03. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is evaluating the impact the updated guidance will have on its disclosures.
In May 2025, FASB issued ASU 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity (“ASU 2025-03”), which amends the guidance for identifying the accounting acquirer in transactions involving the acquisition of a variable interest entity that meets the definition of a business. The new standard is effective for the Company for its annual periods beginning January 1, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard.
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3. Revenue
The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”) and lease income from arrangements containing leases in accordance with ASC 842, Leases (“ASC 842”).
To determine revenue recognition for contracts with customers under ASC 606, the Company performs the following five steps: (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction price to the respective performance obligations in the contract, and (v) recognize revenue when (or as) the Company satisfies the performance obligation.
The Company recognizes revenue when it transfers its goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange.
The Company is a strategic asset company (SAC) focused on active participation in Ethereum (ETH) infrastructure while winding down its digital asset mining business and through its majority-owned subsidiary, WhiteFiber, high performance computing (“HPC”) business, including cloud services and colocation services through its operation of HPC data centers.
In June 2025, the Company announced that it had initiated a strategic transition to become a pure play ETH staking and treasury company. In connection with the transition, the Company intends to convert its BTC holdings into ETH over time and has commenced a strategic alternatives process for its bitcoin mining operations, which is expected to result in a sale or wind-down, with any net proceeds to be re-deployed into ETH.
Disaggregation of revenues
Revenue disaggregated by reportable segment is presented in Note 19. Segment Reporting.
Cloud services
The Company provides cloud services to support customers’ generative AI workstreams. We have determined that cloud services are a single continuous service comprised of a series of distinct services that are substantially the same and have the same pattern of transfer (i.e. distinct days of service).
These services are consumed as they are received, and the Company recognizes revenue over time using the variable allocation exception as it satisfies performance obligations. We apply this exception because we concluded that the nature of our obligations and the variability of the payment terms based on the number of GPUs providing HPC services are aligned and uncertainty related to the consideration is resolved on a daily basis as we satisfy our obligations. The Company recognizes revenue net of consideration payable to customers, such as service credits, and accounted for as a reduction of the transaction price in accordance with guidance in ASC 606-10-32-25.
The Company’s cloud services revenue has been generated from Iceland initially. Beginning in 2026, the Company began generating cloud service revenue in the United States as well as an immaterial amount of revenue in Canada, representing a small portion of total revenue, through services provided to a third-party customer following the deployment of the GPU server in one of its Canadian data centers.
Data center/Colocation services
Colocation services generate revenue from Canada and the United States by providing customers with physical space, power, and cooling within the Company’s data center facilities. Certain colocation arrangements convey to customers the right to control the use of identified data center assets for a specified period and are accounted for as leases under ASC 842.
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Our revenue is primarily derived from recurring revenue streams, mainly (1) colocation services, which include the leasing of cabinet space and power and (2) connectivity services, which include cross-connects. Additionally, the remainder of our revenue is from non-recurring revenue, which primarily includes installation services related to a customer’s initial deployment.
Revenues from recurring revenue streams are billed monthly and recognized ratably over the term of the contract, generally one to ten years for data center colocation customers. Non-recurring installation fees, although generally paid upfront upon installation, are deferred and recognized ratably over the contract term. For arrangements accounted for as leases, nonrecurring charges allocated to the lease component are included in fixed lease payments and recognized on a straight-line basis over the lease term. The difference between straight-line license revenue and amounts billed or received is recorded as deferred revenue in the condensed consolidated balance sheets.
For operating leases, lease income from fixed payments is generally recognized on a straight-line basis over the lease term, commencing when the underlying asset is made available for use by the customer.
For contracts containing lease and nonlease components, the Company has elected the lessor practical expedient provided by ASC 842. When the applicable criteria are met, the combined component is accounted for under ASC 842 if the lease component predominates, or under ASC 606 if the nonlease component predominates.
We guarantee certain service levels, such as uptime, as outlined in individual customer contracts. If these service levels are not achieved due to any failure of the physical infrastructure or offerings, or in the event of certain instances of damage to customer infrastructure within our data center, we would reduce revenue, or lease income for arrangements accounted for as leases, for any credits or cash payments given to the customer.
Digital asset mining
The Company enters into contracts with mining pool operators to provide computing power to digital asset mining pools. Providing computing power for digital asset transaction verification services is an output of the Company’s ordinary activities. The provision of such computing power is the only performance obligation in the Company’s contracts with mining pool operators.
Contract inception and the Company’s enforceable right to consideration begin when the Company commences providing hash calculation services to the mining pool operators. Each party to the contract has the unilateral right to terminate the contract at any time without any compensation to the other party for such termination. As such, the duration of a contract is less than 24 hours (one day) and may be continuously renewed throughout the day. The implied renewal option is not a material right because there are no upfront or incremental fees in the initial contract, and the rate of payments remains the same upon each implied renewal, as the Full-Pay-Per-Share (FPPS) formula remains the same. The Company is entitled to compensation once it begins to perform hash calculations for the pool operator in accordance with the operator’s specifications over a 24-hour period beginning 00:00:00 UTC and ending 23:59:59 on a daily basis. In exchange for providing computing power, the Company is entitled to a fractional share of the fixed digital assets award the mining pool operator receives, for successfully adding a block to the blockchain. The Company’s fractional share is based on the proportion of computing power the Company contributed to the mining pool operator to the total computing power contributed by all mining pool participants in solving the current algorithm. The Company is entitled to its relative share of consideration even if a block is not successfully placed.
The transaction consideration the Company receives, if any, is noncash consideration in the form of digital assets, net of pool fees charged by the mining pool operator. The Company estimates the fair value of noncash consideration at contract inception. This non-cash consideration is variable since the amount of block reward earned depends on the Company’s hash rate provided and transaction fees depend on the actual Bitcoin Network transaction fees. While the non-cash consideration is variable, the payout is settled the next day on a daily basis and the Company has the ability to estimate the variable consideration with reasonable certainty, without the risk of significant revenue reversal because it is probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved.
Revenue is recognized on the same day that control of the contracted service transfers to the mining pool operator, which is the same day as contract inception. Revenue is estimated and recognized based on the spot price of Bitcoin determined using the Company’s Principal Market at 0:00:00 UTC on the date of contract inception.
Below table presents the Company’s revenues generated from digital asset mining business from Foundry USA Pool by country:
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| United States | $ | $ | $ | $ | ||||||||||||
| Iceland | - | |||||||||||||||
| $ | $ | $ | $ | |||||||||||||
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ETH staking business
The Company generates revenue through ETH staking rewards. The Company commenced both native staking business and liquid staking business in 2022. In the first quarter of 2024, the Company terminated its liquid staking business. In July 2025, we resumed liquid staking through Liquid Collective protocol with
With the introduction of staked ETH withdrawals in April 2023, we have reassessed our Ethereum network staking approaches, weighing the advantages of traditional staking against liquid staking solutions. The withdrawal feature in native staking, coupled with yields that are on par with those of liquid staking, has encouraged us to expand our collaborations with other service providers in this domain. As a result, we have terminated all liquid staking activities with StakeWise and Liquid Collection in the third quarter of 2023 and in the first quarter of 2024, respectively, reclaiming all staked Ethereum along with the accumulated rewards. In the fourth quarter of 2023, the Company terminated the native staking activities and reclaimed all staked Ethereum with Blockdaemon. Subsequently, we have ceased our native staking with MarsLand in the first quarter of 2024 and initiated our native staking with Figment Inc.
(a) Native staking
The Company participates in native staking solely as a delegator through a third-party validator. Under this arrangement, the Company delegates ETH directly to the validator, which operates nodes on the Ethereum network to validate transactions and propose new blocks. In exchange for participating in the staking process, the Company is entitled to receive staking rewards, consisting of newly issued ETH and transaction fees, generally based on the amount of ETH delegated by the Company.
To participate in native staking, the Company’s ETH is deposited into the Ethereum staking deposit smart contract in accordance with the protocol requirements. Although the ETH is committed to the staking protocol, the Company retains control of the underlying digital assets. The deposited ETH is not transferred to the validator or any other counterparty, and neither the validator nor any other party obtains the ability to sell, pledge, lend, or otherwise direct the use of the Company’s staked ETH.
The withdrawal credentials associated with the staked ETH are designated to the Company’s custodian, which holds the Company’s digital assets solely for the Company’s benefit and does not obtain control over those assets through its custodial services. Accordingly, the Company concludes that native staked ETH continue to meet the criteria for recognition as its assets and are not derecognized upon deposit into the Ethereum staking deposit contract.
Rewards earned from native staking activities are recognized as revenue in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”). The Company’s delegation of ETH to the validator represents an output of its ordinary activities. Under the staking arrangement, the Company provides the validator with the right to use the Company’s delegated ETH in the validation process and, in exchange, is entitled to receive variable consideration in the form of ETH. The noncash consideration is measured at the fair value of ETH at contract inception using quoted prices on the Coinbase exchange, which the Company has determined to be its principal market.
Revenue is recognized at the point in time when the Ethereum network confirms completion of the validation activities and the Company’s right to the staking rewards is established. The amount of revenue recognized reflects the protocol rewards to which the Company is entitled under the staking arrangement.
As of September 30, 2026 and December 31, 2025, the Company had native staked
For the nine months ended September 30, 2026, the Company earned
For the nine months ended September 30, 2025, the Company earned
(b) Liquid staking
The Company also participates in liquid staking arrangements through Liquid Collective. Under this arrangement, the Company contributes ETH to the Liquid Collective staking protocol, and LsETH is minted and received in return. LsETH represents the Company’s interest in the underlying staked ETH and the related staking rewards.
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LsETH is accounted for as an indefinite-lived intangible asset in accordance with ASC 350-30, changes in LsETH’s fair value while the Company remains staked with the liquid staking, are not recognized. There is no ongoing performance obligation following the staking of ETH through the liquid staking. LsETH is a non-rebasing token, and accordingly, the quantity of LsETH held by the Company does not increase as staking rewards accrue.
Staking rewards associated with LsETH are recognized only upon redemption of LsETH for the underlying ETH, at which time the Company becomes entitled to the accumulated staking rewards. The noncash consideration is measured at the fair value of ETH at contract inception, which corresponds to the date the underlying ETH was initially contributed to the Liquid Collective staking arrangement. Staking rewards recognized upon redemption of LsETH are presented within “other (expense) income, net” in the Company’s condensed consolidated statements of operations. For the nine months ended September 30, 2026 and 2025, the Company generated income of $nil and $
Upon staking ETH through the liquid staking protocol, the ETH is derecognized because the protocol obtains the ability to deploy and direct its use, and the LsETH token is received and recognized concurrently. Any gain or loss on the staking transaction is recognized in accordance with ASC 610-20, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets (“ASC 610-20”), based on the difference between the carrying amount of the ETH staked and the fair value of the LsETH received, and is included in “Gains (losses) on digital assets” in the Company’s condensed consolidated statements of operations. For the nine months ended September 30, 2026, the Company liquid staked ETH and received LsETH and recognized a realized gain of $
Contract costs
The Company capitalizes commission expenses directly related to obtaining customer contracts, which would not have been incurred if the contract had not been obtained. As of September 30, 2026, capitalized costs to obtain a contract totaled $
Contract assets
Contract assets primarily consist of revenue allocated to complimentary services provided to customers as part of contractual arrangements. As of September 30, 2026 and December 31, 2025, there were no contract assets.
Contract liabilities
The Company’s contract liabilities consist of deferred revenue and customer deposits related to contracts accounted for under ASC 606. As of September 30, 2026 and December 31, 2025, contract liabilities were $
During the three months ended September 30, 2026 and 2025, $
Remaining performance obligation
The following table presents estimated revenue expected to be recognized in the future related to the unsatisfied portion of the performance obligation for contracts with customers accounted for under ASC 606 as of September 30, 2026:
| 2026 | 2027 | 2028 | 2029 | 2030 | Thereafter | Total | ||||||||||||||||||||||
| Colocation Services | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
| Cloud Services | ||||||||||||||||||||||||||||
| Total remaining performance obligations | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
The Company has elected to apply the practical expedient under ASC 606-10-50-14(a) and exclude from this table contracts with an original expected duration of one year or less. These contracts primarily relate to cloud services, with the remaining performance obligations generally expected to be satisfied within one year.
The amounts presented in the table above also exclude variable consideration allocated entirely to wholly unsatisfied performance obligations. Such amounts have been excluded from the disclosure of remaining performance obligations under ASC 606-10-50-14(b).
For contracts with customers accounted for under ASC 842, refer to Note 8. Leases.
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4. Acquisitions
Real Estate Acquisition – Madison, North Carolina
On May 20, 2025, the Company, through WhiteFiber, acquired the building and land, together with all the related improvements owned by Unifi Manufacturing, Inc. (“Unifi Transaction”) that were located in Madison, North Carolina. The total consideration consisted of $
The acquired set of assets did not meet the definition of a business as defined in ASC 805, Business Combinations, as no substantive processes or employees were acquired. The assets acquired consisted primarily of land, building and related equipment, which are included in Property, plant, and equipment, net on the condensed consolidated balance sheets. The fair value of the tangible assets acquired was estimated to be $
In connection with the agreement, additional contingent consideration may become payable to the seller based on the timing and availability of power at the site (see Note 21. Commitments and Contingencies).
Real Estate Acquisition – Saint-Jérôme, Québec
On May 8, 2026, the Company, through WhiteFiber, acquired the land and building comprising its MTL-3 facility in Saint-Jérôme, Québec, for a fixed purchase price of CAD $
The acquired set of assets did not meet the definition of a business as defined in ASC 805, Business Combinations, as no substantive processes or employees were acquired. The assets acquired consisted primarily of land, building and related equipment, which are included in Property, plant, and equipment, net on the condensed consolidated balance sheets. The fair value of the tangible assets acquired was estimated to be $
Financière Louis David and Financière Marjos Asset Acquisition
On November 28, 2025, the Company acquired a
The total consideration transferred consisted of approximately $
FLD and FM did not meet the definition of a business as defined in ASC 805, Business Combinations, as no substantive processes or employees were acquired. Accordingly, the transactions were accounted for as asset acquisitions. In accordance with ASC 810-10-15-14 and ASC 810-10-25-38A, FM is considered a variable interest entity (“VIE”). Because the Company owns
Through December 31, 2025, the Company recognized approximately $
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5. DIGITAL ASSETS HOLDINGS
Digital Assets
Effective January 1, 2024, the Company early adopted ASU 2023-08, which requires entities to measure crypto assets at fair value with changes recognized in net income each reporting period. The Company’s digital assets are within the scope of ASU 2023-08 and the transition guidance requires a cumulative-effect adjustment as of the beginning of the current fiscal year for any difference between the carrying amount of the Company’s digital assets and fair value. As a result of the Company’s early adoption of ASU 2023-08, the Company recorded a $
The following table presents the Company’s significant digital assets holdings as of September 30, 2026:
| Quantity | Cost Basis | Fair Value | ||||||||||
| BTC | $ | $ | ||||||||||
| ETH | ||||||||||||
| Total digital assets held as of September 30, 2026 | $ | $ | ||||||||||
The cost basis is equal to the post-impairment value of all BTC and ETH held as of the adoption of ASU 2023-08 on January 1, 2024. For BTC and ETH earned subsequent to the adoption of ASU 2023-08, the cost basis of the BTC and ETH represents the valuation at the time the Company determined for revenue recognition purposes.
The following table presents a roll-forward of BTC for the nine months ended September 30, 2026, based on the fair value model under ASU 2023-08:
| Fair value | ||||
| BTC fair value as of December 31, 2025 | $ | |||
| Receipt of BTC from mining services | ||||
| Sales of BTC in exchange of cash | ( | ) | ||
| Sales of BTC in exchange of USDC | ( | ) | ||
| Payment of BTC for service charges from mining facilities | ( | ) | ||
| Payment of BTC for other expenses | ( | ) | ||
| Change in fair value of BTC | ( | ) | ||
| BTC fair value as of September 30, 2026 | $ | |||
For the additions of BTC generated by the Company’s mining business, see Note 3. Revenue.
Bitcoin is sold on a FIFO basis. For the nine months ended September 30, 2026, losses/gains from the sales of bitcoin are included in change in fair value of BTC which is included in the consolidated statements of operations under the caption “Gains (Losses) on digital assets”.
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The following table presents a roll-forward of ETH for the nine months ended September 30, 2026, based on the fair value model under ASU 2023-08:
| Fair value | ||||
| ETH fair value as of December 31, 2025 | $ | |||
| Receipt of ETH from native staking business | ||||
| Receipt of ETH from exchange of cash | ||||
| Sales of ETH in exchange of LsETH | ( | ) | ||
| Sales of ETH in exchange of cash | ( | ) | ||
| Change in fair value of ETH | ( | ) | ||
| ETH fair value as of September 30, 2026 | $ | |||
For the additions of ETH generated by the Company’s ETH staking business, see Note 3. Revenue.
ETH is sold on a FIFO basis. For the nine months ended September 30, 2026, losses/gains from the sales of ETH are included in change in fair value of ETH which is included in the consolidated statements of operations under the caption “Gains (Losses) on digital assets “.
Digital Intangible Assets
The following table presents the Company’s digital intangible assets holdings as of September 30, 2026.
| Quantity | Cost | Impairment | Carrying Value | |||||||||||||
| LsETH | $ | $ | ( | ) | $ | |||||||||||
| Total digital intangible assets held as of September 30, 2026 | $ | $ | ( | ) | $ | |||||||||||
The impairment amount represents the cumulative impairment loss attributable to the LsETH balance held as of September 30, 2026 and is included within the total impairment loss of $
The following table presents a roll-forward of our LsETH holdings for the nine months ended September 30, 2026, based on the cost less impairment model in accordance with ASC 350-30.
| Carrying Value | ||||
| LsETH cost as of December 31, 2025 | $ | - | ||
| Receipt of LsETH in exchange of ETH | ||||
| Receipt of LsETH from collateral receivable | ||||
| Transfer from LsETH to collateral receivable | ( | ) | ||
| Gain from exchange of LsETH | ||||
| Impairment loss | ( | ) | ||
| LsETH carrying value as of September 30, 2026 | $ | |||
For the three months ended September 30, 2026 and September 30, 2025, the Company recognized an impairment loss of $
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6. DIGITAL ASSET COLLATERAL RECEIVABLE
The Company entered into collateralized borrowing arrangements in which LsETH is transferred to lending counterparties as collateral for U.S. dollar borrowings. Under the terms of these arrangements, the lending counterparties have the right to sell, pledge, rehypothecate, assign, invest, use, commingle or otherwise dispose of the transferred LsETH during the term of the borrowing. During the term of these arrangements, the Company retains a contractual right to receive an equivalent quantity of LsETH upon settlement of the related borrowing.
During the ordinary course of these arrangements, the Company may transfer additional LsETH to satisfy collateral maintenance requirements or receive returned collateral as collateral requirements change or upon repayment of the related borrowing.
The following table summarizes the Company’s digital asset collateral receivable:
| September 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| Opening balance | $ | - | $ | - | ||||
| Initial digital asset collateral transferred | - | |||||||
| Additional digital asset collateral transferred | - | |||||||
| Digital asset collateral returned | ( | ) | - | |||||
| Ending balance | $ | $ | - | |||||
7. OTHER CURRENT ASSETS, NET
Other current assets were comprised of the following:
| September 30, 2026 | December 31, 2025 | |||||||
| Deposits (a) | $ | $ | ||||||
| Prepaid director and officer insurance expenses | ||||||||
| Prepaid consulting service expenses | ||||||||
| Deposit for lease | ||||||||
| Deferred contract costs | ||||||||
| Prepayment to third parties (b) | ||||||||
| Receivable from third parties (c) | ||||||||
| Funds held in escrow | ||||||||
| Prepaid income tax | - | |||||||
| Others | ||||||||
| Less: Current expected credit losses | ( | ) | ( | ) | ||||
| Total | $ | $ | ||||||
| (a) |
| (b) |
| (c) |
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8. LEASES
Lease as Lessee
The Company leases for data center capacity, cloud infrastructure, office space and general and administrative purposes under non-cancelable lease arrangements. These leases, including a data center lease acquired as part of the Enovum acquisition in 2024, generally have terms ranging from approximately
On April 11, 2025, the Company entered into a 20-year data center lease agreement in Saint-Jérôme for its data center colocation services, with two five-year extension options and a fixed-price purchase option exercisable until December 31, 2025. In December 2025, the Company became reasonably certain to exercise the purchase option and remeasured the lease as a finance lease as of December 1, 2025. As a result of the remeasurement of the lease liability, there was a reduction of approximately $
During the three months ended September 30, 2026, the Company commenced new operating lease arrangements primarily related to data center facilities in France, Australia, and Canada. These arrangements resulted in the recognition of approximately $
As of September 30, 2026 and December 31, 2025, right-of-use asset and lease liabilities consisted of the following:
| September 30, 2026 | December 31, 2025 | |||||||
| Operating right-of-use assets | $ | $ | ||||||
| Finance right-of-use assets | - | |||||||
| Total right-of-use-assets | $ | $ | ||||||
| Operating lease liabilities | ||||||||
| Finance lease liabilities | - | |||||||
| Total lease liabilities | $ | $ | ||||||
Operating right-of-use assets are recorded net of accumulated amortization of $
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Finance lease right-of-use asset is recorded net of accumulated amortization of $
For the three months ended September 30, 2026 and 2025, the Company’s amortization on the operating lease right-of-use assets totaled $
For the nine months ended September 30, 2026 and 2025, the Company’s amortization on the operating lease right-of-use assets totaled $
For the three months ended September 30, 2026 and 2025, there was no finance lease interest expense or amortization expense, respectively.
For the nine months ended September 30, 2026, the Company’s interest expense and amortization on the finance lease was $
The following table presents the components of the Company’s lease expense. GPU lease expenses and data center lease expenses related to operational data centers are included in cost of revenue; data center lease expenses incurred during construction and office lease expenses are included in general and administrative expenses:
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Operating lease costs | $ | $ | $ | $ | ||||||||||||
| Finance lease costs | - | - | - | |||||||||||||
| Short-term lease costs | ||||||||||||||||
| Sublease income | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total lease costs | $ | $ | $ | $ | ||||||||||||
The Company entered into a GPU server lease agreement effective January 2024 for its cloud services designed to support generative AI workstreams. The lease payment depends on the usage of the GPU servers and the Company concludes that the lease payments are variable and will be recognized when they are incurred. For the three months ended September 30, 2026 and 2025, the GPU server lease expense amounted to $
Additional information regarding the Company’s leasing activities as a lessee is as follows:
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Operating cash outflows from operating leases | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Operating cash outflows from finance lease | - | - | ( | ) | - | |||||||||||
| Financing cash outflows from finance lease | $ | - | $ | - | $ | ( | ) | $ | - | |||||||
| Weighted average remaining lease term – operating leases | ||||||||||||||||
| Weighted average discount rate – operating leases | % | % | % | % | ||||||||||||
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The following table represents our future minimum operating lease payments as of September 30, 2026:
| Year | Amount | |||
| 2026 | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| Thereafter | ||||
| Total undiscounted lease payments | ||||
| Less: present value discount | ( | ) | ||
| Present value of operating lease liabilities | $ | |||
Leases Not Yet Commenced
In July 2026, the Company entered into an agreement with a data center provider for colocation services at a data center facility in Canada. The agreement provides for 2.7 megawatts of critical IT capacity for an initial term of 60 months, with fixed monthly payments of $
Lease as Lessor
The Company enters into lease arrangements for data storage and cloud service equipment, as well as dedicated data center capacity and related colocation services. These arrangements generally have lease terms ranging from approximately two to ten years.
Sales-Type Leases
Lease income from sales-type leases is primarily recognized as interest income over the lease term. The Company’s exposure to credit risk is limited to net investment in leases.
The components of lease income for the sales-type lease were as follows:
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Interest income related to net investment in lease | $ | $ | $ | $ | ||||||||||||
Interest income is included in the condensed consolidated statements of operations under the caption “Revenue – Other”.
The components of net investment in sales-type leases were as follows:
| September 30, 2026 | December 31, 2025 | |||||||
| Net investment in lease - lease payment receivable | $ | $ | ||||||
In the second quarter of 2026, the Company terminated an existing sales-type lease with a customer, derecognizing $
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The following table illustrates the Company’s future minimum receipts for sales-type lease as of September 30, 2026:
| Year | Sales-Type Lease | |||
| 2026 | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| Total future minimum receipts | ||||
| Unearned interest income | ( | ) | ||
| Less: Current expected credit losses | ( | ) | ||
| Net investment in lease, net | $ | |||
The present value of minimum sales-type receipts of $
Operating Lease Income
The Company enters into operating lease arrangements to provide dedicated data center capacity and related colocation services to customers. Operating lease income from fixed lease payments and fixed nonrecurring charges allocated to lease components, is recognized on a straight-line basis over the respective lease terms, commencing when the underlying assets are made available for the customers’ use. Variable lease income is recognized in the period in which the underlying changes in facts and circumstances occur.
The Company also enters into sublease arrangements for portions of its leased data center capacity. These subleases generally include fixed payments with automatic renewal options, unless the sub-tenant provides at least
The Company receives advance payments from customers under certain operating lease arrangements, which are recognized as lease income over the respective lease terms in accordance with ASC 842. As of September 30, 2026 and December 31, 2025, deferred lease income related to these arrangements was $
For the nine months ended September 30, 2026, the Company recognized operating lease income of $
The following table illustrates the future lease payments to be received by the Company under its operating lease arrangements, including data center leases and subleases, as of September 30, 2026:
| Year | Operating Lease | |||
| 2026 | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| Thereafter | ||||
| Total future receipts | $ | |||
9. PROPERTY, PLANT, AND EQUIPMENT, NET
Property, plant and equipment, net was comprised of the following:
| September 30, 2026 | December 31, 2025 | |||||||
| Miners for Bitcoin | $ | $ | ||||||
| Cloud service equipment | ||||||||
| Colocation service equipment | ||||||||
| Purchased and internally developed software | ||||||||
| Land | ||||||||
| Building | - | |||||||
| Leasehold improvements | ||||||||
| Vehicle | ||||||||
| Other property and equipment | ||||||||
| Less: Accumulated depreciation | ( | ) | ( | ) | ||||
| Construction in progress | ||||||||
| Property, plant, and equipment, net | $ | $ | ||||||
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For the three months ended September 30, 2026 and 2025, depreciation and amortization expenses for property, plant and equipment were $
As of September 30, 2026 and December 31, 2025, accrued purchases for property, plant and equipment totaled $
On May 8, 2026, the Company acquired the MTL-3 property following the exercise of the purchase option under the related data center lease agreement (refer to Note 8. Leases). The purchase price of CAD $
During the three months ended September 30, 2026, the Company placed its NC-1 data center into service and reclassified the related costs from construction in progress to buildings and colocation service equipment within property and equipment, net. Depreciation of these assets commenced when they were ready for their intended use.
In the second quarter of 2026, we had an impairment charge of $
During 2024 and 2025, the Company purchased data storage and network equipment that was subsequently derecognized from property, plant and equipment upon entering into sales-type lease arrangements, with the related assets recorded as net investments in leases, totaling approximately $
Disposals of Property, Plant and Equipment
For the nine months ended September 30, 2026, the Company sold
For the nine months ended September 30, 2026, the Company sold
In the second quarter of 2026, the Company determined that it would discontinue further investment in, and use of, its internally-developed software platform. As a result of this decision, effective June 4, 2026, the Company recorded an impairment charge of the remaining book value of $
10. INVESTMENT SECURITIES
Investment securities were comprised of the following:
| September 30, 2026 | December 31, 2025 | |||||||
| Investment in Digital Future Alliance Limited (“DFA”) (a) | $ | $ | ||||||
| Investment in Nine Blocks Offshore Feeder Fund (“Nine Blocks”) (b) | ||||||||
| Investment in Auros Global Limited (c) | ||||||||
| Investment in Ingonyama Ltd (d) | ||||||||
| Investment in Cysic Inc. (e) | ||||||||
| Investment in a SAFE (f) | ||||||||
| Investment in AI Innovation Fund I (“AI fund”) (g) | ||||||||
| Investment in Innovation Fund I (“Innovation fund”) (h) | ||||||||
| Investment in Odiot Holding (i) | ||||||||
| Total | $ | $ | ||||||
(a) Investment in Digital Future Alliance Limited (“DFA”)
DFA is a privately held company, over which the Company has neither control nor significant influence through investment in ordinary shares. The Company accounted for the investment in DFA using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer.
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For the three and nine months ended September 30, 2026 and 2025, the Company did not record upward adjustments or downward adjustments on the investment. The Company’s impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of September 30, 2026 and December 31, 2025, the Company did not recognize impairment against the investment security.
(b) Investment in Nine Blocks Offshore Feeder Fund (“Nine Blocks”)
On August 1, 2022, the Company entered into a subscription agreement with Nine Blocks for investment of $
As a practical expedient, the Company uses Net Asset Value (“NAV”) or its equivalent to measure the fair value of the investment in the fund. For the three months ended September 30, 2026 and 2025, the Company recorded cumulative downward adjustments of $
(c) Investment in Auros Global Limited (“Auros”)
On February 24, 2023, the Company closed an investment of $
For the three and nine months ended September 30, 2026 and 2025, the Company did not record upward adjustments or downward adjustments on the investment. The Company’s impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of September 30, 2026 and December 31, 2025, the Company did not recognize impairment against the investment security.
(d) Investment in Ingonyama Ltd. (“Ingonyama”)
In September 2023, the Company closed an investment of $
For the three and nine months ended September 30, 2026 and 2025, the Company did not record upward adjustments or downward adjustments on the investment. The Company’s impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of September 30, 2026 and December 31, 2025, the Company did not recognize impairment against the investment security.
(e) Investment in Cysic Inc (“Cysic”)
On April 2, 2024, the Company closed an investment of $
For the three and nine months ended September 30, 2026 and 2025, the Company did not record upward adjustments or downward adjustments on the investment. The Company’s impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of September 30, 2026 and December 31, 2025, the Company did not recognize impairment against the investment security.
(f) Investment in a SAFE
On May 30, 2024 (the “Effective Date”), and subsequently amended June 30,2024, the Company entered into a simple agreement for future equity (“SAFE”) agreement for an initial investment amount of $
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The Company accounted for this investment under ASC 320, Investments - Debt Securities and elected the fair value option for the SAFE investment pursuant to ASC 825, Financial Instruments, which requires financial instruments to be remeasured to fair value each reporting period, with changes in fair value recorded in the condensed consolidated statements of operations. The fair value estimate includes significant inputs not observable in the market, which represents a Level 3 measurement within the fair value hierarchy. The decision to elect the fair value option is determined on an instrument-by-instrument basis on the date the instrument is initially recognized, is applied to the entire instrument, and is irrevocable once elected. For instruments measured at fair value, embedded conversion or other features are not required to be separated from the host instrument. Issuance costs related to convertible securities carried at fair value are not deferred and are recognized as incurred on the condensed consolidated statements of operations.
On August 10, 2026, Canopy and SAIHEAT Limited (“SAIHEAT”) announced that they had entered into a definitive merger agreement pursuant to which Canopy would become a wholly owned subsidiary of SAIHEAT in a stock-for-stock transaction. In connection with the proposed merger, SAIHEAT is expected to be renamed Canopy Wave Holdings Inc.
In connection with the proposed merger, WhiteFiber and Canopy entered into a Surrender and Termination Agreement pursuant to which WhiteFiber’s existing SAFE investment will be surrendered and terminated, effective upon the closing of the merger, in exchange for a cash payment of $
As of September 30, 2026, the proposed merger had not been completed, and the SAFE had not been surrendered or terminated. Accordingly, the Company continued to recognize its existing SAFE investment, with a carrying value of $
At September 30, 2026, the Company performed a qualitative assessment to identify if events or circumstances indicate that the investment is impaired or that an observable price change has occurred. We considered available information about Canopy’s operations and industry conditions. No events or circumstances were identified that would indicate the investment is impaired or that an observable price change occurred. The Company did not recognize any upward or downward adjustment to the value of the investment for the three or nine months ended September 30, 2026.
(g) Investment in AI Innovation Fund I (“AI fund”)
On July 15, 2024, the Company entered into a subscription agreement with Pleasanton Ventures Innovation Master Fund SPC Limited for investment of $
As a practical expedient, the Company uses Net Asset Value (“NAV”) or its equivalent to measure the fair value of the investment in the fund. For the three and nine months ended September 30, 2026, the Company recorded cumulative downward adjustments of $
(h) Investment in Innovation Fund I (“Innovation fund”)
After the Company disposed its BVI entities for its previous fund operation, the Company no longer consolidates the investment in the fund. As a practical expedient, the Company uses Net Asset Value (“NAV”) or its equivalent to measure the fair value of the investment in the fund.
In March 2025, the Company invested an additional
In August 2025, the Company invested an additional
For the three months ended September 30, 2026 and 2025, the Company recorded cumulative upward adjustments of $
For the nine months ended September 30, 2026 and 2025, the Company recorded cumulative downward adjustments of $
(i) Investment in Odiot Holding (“Odiot Holding”)
In connection with the acquisition of Bit Digital Europe Holding (“BDEH”) on November 28, 2025, the Company acquired an indirect minority equity interest in Odiot Holding, a publicly traded company in France. The Company does not have control or significant influence over Odiot Holding.
Accordingly, the investment is accounted for as an equity security under ASC 321, Investments — Equity Securities, The investment was initially recorded at fair value on the acquisition date and is subsequently measured at fair value using quoted market prices in an active market (Level 1 inputs), with changes in fair value recognized in earnings.
For the three and nine months ended September 30, 2026, the Company recorded cumulative upward adjustments of $
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(j) PIPE Investment
On August 10, 2026, WhiteFiber entered into the PIPE Share Purchase Agreement with SAIHEAT Limited, an exempted company incorporated under the laws of the Cayman Islands (“SAIHEAT”). Pursuant to the PIPE Share Purchase Agreement, WhiteFiber purchased from SAIHEAT, an aggregate of
The PIPE investment was entered into in connection with the proposed merger between SAIHEAT and Canopy, pursuant to which Canopy would become a wholly owned subsidiary of SAIHEAT. The consummation of the PIPE investment is contingent upon the completion of the proposed merger and the satisfaction of certain closing conditions.
As of September 30, 2026, the proposed merger had not been completed, and the PIPE Shares had not been issued to the Company. Accordingly, the Company had not recognized an investment in the PIPE Shares in its condensed consolidated balance sheet as of September 30, 2026. Upon completion of the transaction, the Company expects to account for the PIPE Shares in accordance with the applicable U.S. GAAP guidance for equity securities.
WhiteFiber expects to have neither control nor significant influence through investment in PIPE Shares. Four members of the management, including the Company’s Chief Financial Officer, participated in the PIPE transaction in their personal capacity as investors and invested $
11. OTHER NON-CURRENT ASSETS, NET
Other non-current assets were comprised of the following:
| September 30, 2026 | December 31, 2025 | |||||||
| Deposits (a) | $ | $ | ||||||
| Deferred contract costs | ||||||||
| Deferred financing costs | - | |||||||
| Prepayment to third parties | - | |||||||
| Others | ||||||||
| Less: Current expected credit losses | ( | ) | ( | ) | ||||
| Total | $ | $ | ||||||
| (a) |
12. DEBT
2030 Convertible notes
In October 2025, we issued $
The Notes were issued pursuant to, and are governed by, an indenture (the “Base Indenture”), dated as of October 2, 2025, between the Company and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”), as supplemented by a first supplemental indenture (the “Supplemental Indenture,” and the Base Indenture, as supplemented by the Supplemental Indenture, the “Indenture”), dated as of October 2, 2025, between the Company and the Trustee. The net proceeds from the 2030 Notes offering, after deducting underwriting discounts and commissions and estimated offering expenses, were approximately $
The 2030 Notes are senior and unsecured obligations and bear interest at a coupon rate of
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Noteholders may convert their 2030 Notes at their option prior to the close of business on the second scheduled trading day immediately preceding the maturity date. The conversion rate is initially
Holders of the 2030 Notes have a one-time noncontingent right to require the Company to repurchase for cash all or any portion of their respective notes at a repurchase price equal to
Under the interest make-whole conversion rate adjustment, the holders of the 2030 Notes are able to convert at any time during the period from, and including, the date that is six months after the last date of original issuance of the notes until the close of business on the business day immediately preceding September 15, 2028 (other than a conversion in connection with a make-whole fundamental change), the Company will increase the conversion rate per US$
We may not redeem the 2030 Notes prior to October 6, 2028. We may redeem for cash all or any portion of the 2030 Notes, at our option, on or after October 6, 2028 and prior to the 31st scheduled trading day immediately preceding the maturity date, if the last reported sale price of our ordinary shares has been at least
If a “Fundamental Change” (as defined in the Indenture) occurs, then, subject to certain conditions and except as set forth in the Indenture, noteholders may require the Company to repurchase their 2030 Notes at a cash repurchase price equal to the principal amount of the Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date. The definition in the Indenture of a Fundamental Change includes certain business combination transactions involving the Company and certain de-listing events with respect to the ordinary shares.
The Indenture contains customary terms and covenants, including that upon certain events of default either the Trustee or the holders of at least
The conversion features embedded in the 2030 Notes met the criteria to be bifurcated from the debt host contract under ASC 815 and recognized separately at fair value. The total proceeds received were first allocated to the fair value of the derivative liability, and the remaining proceeds allocated to the host. The host is subsequently measured using the effective interest method, and the derivative liability is measured at fair value, with changes in fair value recorded as derivative loss in the consolidated statements of operations. The estimated fair value of the entire 2030 Notes was determined to be approximately $
2031 Convertible notes
On January 26, 2026, WhiteFiber issued $
The net proceeds from the 2031 Notes offering, after deducting initial purchasers’ discounts and offering expenses, were approximately $
Noteholders may convert their 2031 Notes at their option prior to the close of business on the second scheduled trading day immediately preceding the maturity date. Upon conversion, WhiteFiber will satisfy its conversion obligation by paying or delivering, as the case may be, cash, its ordinary shares, or a combination of cash and ordinary shares, at WhiteFiber’s election, in the manner and subject to the terms and conditions set forth in the Indenture. The conversion rate is initially
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Holders may require the WhiteFiber to repurchase the 2031 Notes for cash on February 6, 2029 or upon the occurrence of certain fundamental changes, in each case subject to the terms of the governing indenture, at
The Indenture contains customary terms and covenants, including certain bankruptcy and insolvency-related events of default, the occurrence of which will result in the outstanding 2031 Notes automatically becoming due and payable, and certain non-bankruptcy and insolvency-related events of default, upon the occurrence of which either the Trustee or the holders of at least
In August 2026, WhiteFiber purchased $
WhiteFiber accounts for the remaining 2031 Notes as a single liability instrument at amortized cost, net of unamortized debt issuance costs. As of September 30, 2026, WhiteFiber classified the 2031 Notes as a long-term liability. Although the 2031 Notes are currently convertible, WhiteFiber has the intent and the ability to settle any conversion in its ordinary shares and therefore does not expect that settlement of the 2031 Notes will require the use of current assets or the creation of other current liabilities. Holders may require repurchase of the 2031 Notes for cash on February 6, 2029, which is more than twelve months after September 30, 2026.
Zero-Strike Call Option Transaction
In connection with the issuance of the 2031 Notes, WhiteFiber entered into a zero-strike call option transaction (“Zero-Strike Call Option”) with one of the initial purchasers or its affiliate (the “Option Counterparty”). Pursuant to the Call Option Transaction, WhiteFiber paid a premium equal to approximately $
2032 Convertible Senior Notes
On August 21, 2026, WhiteFiber completed a private offering of $
The initial conversion rate is
WhiteFiber accounts for the 2032 Notes as a single instrument. As of September 30, 2026, WhiteFiber has classified the 2032 Notes as a long-term liability. Although the 2032 Notes are currently convertible, WhiteFiber has the intent and the ability to settle any conversion in its ordinary shares, and therefore does not expect that settlement of the 2032 Notes will require the use of current assets or the creation of other current liabilities. Holders may require repurchase of the 2032 Notes for cash on September 6, 2030, which is more than twelve months after September 30, 2026.
Partial Repurchase of 2031 Notes
On August 18, 2026, WhiteFiber entered into binding, privately negotiated transactions with certain holders of its 2031 Notes to repurchase an aggregate principal amount of $
WhiteFiber concluded that the repurchase transactions qualified for induced conversion accounting under ASC 470-20, including the amendments in ASU 2024-04. WhiteFiber measured the inducement expense as the excess of the fair value of the consideration transferred over the fair value of consideration issuable under the original conversion privileges, measured as of August 18, 2026, the date of binding acceptance. WhiteFiber recognized induced conversion expense of approximately $
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Upon settlement on August 21, 2026, WhiteFiber derecognized the carrying amount of the settled 2031 Notes, including related unamortized issuance costs, and recorded the applicable amounts in additional paid-in capital. in accordance with its induced conversion accounting conclusion.
The following table summarizes the balances of the convertible notes:
| As of September 30, 2026 | As of December 31, 2025 | |||||||
| 2030 Convertible notes | $ | $ | ||||||
| 2031 Convertible notes | - | |||||||
| 2032 Convertible notes | - | |||||||
| Less: unamortized debt issuance costs and debt discount | ( | ) | ( | ) | ||||
| Subtotal | ||||||||
| Less: Current portion | - | - | ||||||
| Convertible notes, net of current portion | $ | $ | ||||||
For the three and nine months ended September 30, 2026, interest expense related to the convertible notes totaled $
Accrued interest related to the convertible notes as of September 30, 2026 was $
Included in the unamortized debt issuance costs and debt discount as of September 30, 2026 was approximately $
The following table summarizes the balances of the Company’s other short-term and long-term debts:
| Principal Amount | Unamortized Debt Discount and Issuance Costs | Net Carrying Amount | ||||||||||
| Short-Term Debt: | ||||||||||||
| Collateralized borrowing | $ | $ | - | $ | ||||||||
| Iceland Facility - Current | - | |||||||||||
| Syndicated RBC Credit Facility Agreement - Current | - | |||||||||||
| Long-Term Debt: | ||||||||||||
| Iceland Facility – Non-current | ( | ) | ||||||||||
| Syndicated RBC Credit Facility Agreement - Non-current | ( | ) | ||||||||||
| Total term debt | $ | |||||||||||
Iceland Facility
On March 23, 2026, WhiteFiber Iceland ehf. (the “Borrower”), a subsidiary of the Company, entered into a secured term loan facility agreement (the “Facility”) with Landsbankinn hf, which provides for borrowings of up to $
No separate guarantee liability is recognized in the consolidated financial statements as the guarantees provided by the Guarantors are intercompany arrangements that are eliminated upon consolidation under ASC 810-10-45-18. The guarantees are disclosed herein pursuant to the disclosure requirements of ASC 460-10-50-4.
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Borrowings under the Facility bear interest at a floating rate per annum equal to the sum of (i) three month CME Term SOFR (or any successor benchmark), and (ii) an applicable margin of
The Facility is secured by first-ranking security over (i)
The Facility may be drawn in multiple tranches during an availability period, with up to two drawdowns permitted and a minimum draw amount of $
In connection with the entry into the Facility, the Borrower paid an arrangement fee of $
The Facility permits voluntary prepayments, subject in certain cases to prepayment fees, and includes mandatory prepayment provisions in connection with specified events, including certain asset disposals and insurance proceeds, all as set out in the facility agreement.
As of September 30, 2026, the aggregate outstanding principal balance, net of unamortized debt discount and issuance costs, under the Facility was $
Royal Bank of Canada Facility
On June 18, 2025, the Company entered into a non-recourse credit facility (“Credit Facility”) with the Royal Bank of Canada (“RBC”). The Credit Facility provides for an aggregate of up to approximately CAD
The agreement is non-recourse and comprised of three separate facilities:
| ● | Non-revolving three-year lease facility in the amount of $ |
| ● | Non-revolving term loan facility in the amount of $ |
| ● | Revolver by way of letters of credit and letters of guaranty with fees to be determined on a transaction-by-transaction basis. This facility was available for the 36-month term subject to the issuance of the EDC (Export and Development Canada) Performance Security Guaranty in the amount of $ |
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The Company agreed to certain financial covenants including maintaining on a combined basis between MTL-1 and MTL-2: fixed charge coverage of not less than 1.20:1 and a ratio of Net Funded Debt to EBITDA of not greater than 4.25:1 and decreasing to 3.50:1 from December 31, 2027. The facilities had not been authorized for use by the lender, as certain conditions precedent had not yet been satisfied. Accordingly, no amounts were drawn, and no borrowings were available under this facility.
On April 27, 2026, the Company entered into an amended credit agreement (“Amended Credit Agreement”) with RBC. This agreement replaces the original Credit Agreement dated June 18, 2025, as subsequently amended on July 4, 2025. The Amended Credit Agreement provides for an authorized credit facility of CAD $
Borrowings under the facility bore interest, at the Company’s option, at either (i) Daily Simple CORRA plus
Additionally, RBC provided a CAD $
On July 15, 2026, the Amended Credit agreement was repaid in full and refinanced through the Syndicated RBC Credit Facility agreement described below. The revolving facility from the Amended credit agreement in the form of Letters of Credit and Letters of Guarantee remains in place.
Syndicated RBC Credit Facility Agreement
On July 6, 2026, WhiteFiber’s wholly-owned subsidiary, Enovum Data Center Corp. entered into a syndicated credit agreement (“Syndicated RBC Credit Facility Agreement”). The Syndicated RBC Credit Facility Agreement provides for an aggregate of up to approximately CAD $
Borrowings under the Syndicated RBC Credit Facility Agreement bear interest, at the Company’s option, at either (i) the CORRA-based benchmark rate for such interest period, plus
The Syndicated RBC Credit Facility is secured by first-ranking security interests over substantially all present and future personal property and assets of the borrower and the guarantors, together with first-ranking mortgages on certain owned real estate, including the Company’s MTL-2 and MTL-3 properties and related improvements and equipment.
The Company has agreed to certain financial covenants, including a minimum debt service coverage ratio and a maximum Net funded debt to EBITDA ratio. As of September 30, 2026, the Company was in compliance with all financial covenants under the Syndicated RBC Credit Facility Agreement.
On July 15, 2026, the Company drew a CORRA loan amount of CAD $
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B. Riley Facility
On May 26, 2026, the Company assigned to B. Riley a $
On August 24, 2026, WhiteFiber repaid the $
Collateralized borrowing
On March 27, 2026, the Company entered into a collateralized borrowing arrangement with Galaxy Digital LLC (“Galaxy”). The Galaxy Loan Agreement provides for loans to the Company from time to time, with each loan amount, collateral and other terms determined and agreed upon by the Company and Galaxy pursuant to individual Loan Term Sheets. Collateral for each loan may consist of Dollars or Digital Currency, as agreed by the parties. The Loans may be either: an Open Loan, without a Maturity Date, where the Borrower may repay and Lender may recall the Borrowed Asset at any time, or a Term Loan with a predetermined Maturity Date, where the Lender has no right to demand a return of the Borrowed Asset before the Maturity Date. The Borrow Fee for each loan is as agreed upon in the relevant Loan Term Sheet.
On May 20, 2026 and July 30, 2026, the Company drew down $
The borrowing is an evergreen facility that may be recalled by the lender upon seven days’ notice in accordance with the terms of the loan agreement. As the Company does not have an unconditional right to defer settlement of the borrowing for at least one year after the balance sheet date, the related loan payable is classified as a current liability in the condensed consolidated balance sheets. The Galaxy Loan Agreement has an initial term of one year and automatically renews for successive one-year periods unless terminated in accordance with its terms.
Because the Company does not have an unconditional right to defer settlement of the borrowing for at least one year after the balance sheet date, the related loan payable has been classified as a current liability in the condensed consolidated balance sheets.
On September 29, 2026, the Company repaid $
13. FAIR VALUE OF FINANCIAL INSTRUMENTS
In connection with the issuance of the 2030 Notes, the Company recognized a derivative liability related to the embedded conversion feature. See Note 12. Debt for further details on the accounting treatment of the 2030 Notes and associated derivative liability.
The fair value of the embedded conversion feature at issuance of the 2030 Notes and each reporting period was estimated based on significant inputs not observable in the market, which represent Level 3 measurements within the fair value hierarchy.
The fair value of the derivative liability was determined using the Black-Scholes model. The model incorporates the following key inputs and assumptions:
| At September 30, 2026 | At December 31, 2025 | |||||||
| Maturity date | 2030 | 2030 | ||||||
| Debt price | ||||||||
| Volatility rate | % | % | ||||||
| Share price | $ | $ | ||||||
| Dividend yield | % | % | ||||||
| Stock borrow cost | % | % | ||||||
| Credit Spread | % | % | ||||||
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The following table provides a roll forward of the aggregate fair values of the derivative liability for the nine months ended September 30, 2026:
| Embedded Derivative | ||||
| Balance as of January 1, 2026 | $ | |||
| Change in fair value | ( | ) | ||
| Balance as of September 30, 2026 | $ | |||
14. SHARE-BASED COMPENSATION
Share-based compensation such as restricted stock units (“RSUs”), incentive and non-statutory stock options, restricted shares, share appreciation rights and share payments may be granted to any directors, employees and consultants of the Company or affiliated companies under the 2021 Omnibus Equity Incentive Plan (“2021 Plan”), 2021 Second Omnibus Equity Incentive Plan (“2021 Second Plan”), 2023 Omnibus Equity Incentive Plan (“2023 Plan”), 2025 Omnibus Equity Incentive Plan (“2025 Plan”), and 2026 Omnibus Equity Incentive Plan (“2026 Plan”) (collectively, “Bit Digital Incentive Plan”). An aggregate of
On May 13, 2026, the Board of Directors of Bit Digital adopted the 2026 Omnibus Equity Incentive Plan (the “Bit Digital 2026 Plan”) which was approved by the Company’s shareholders on July 29, 2026. The Bit Digital 2026 Plan provides share-based compensation such as RSUs, incentive and non-statutory stock options, restricted shares, share appreciation rights and share payments may be granted to any directors, employees and consultants of the Company or affiliated companies and up to
On February 6, 2025, the Board of Directors of WhiteFiber adopted the 2025 Omnibus Equity Incentive Plan (the “WhiteFiber 2025 Plan”) which provides share-based compensation such as RSUs, incentive and non-statutory stock options, restricted shares, share appreciation rights and share payments may be granted to any directors, employees and consultants of the Company or affiliated companies and up to
From time to time, WhiteFiber grants equity awards under its WhiteFiber 2025 Plan to employees of the Company as consideration for services rendered to WhiteFiber. These awards are settled in WhiteFiber’s ordinary shares and are accounted for as share-based compensation to non-employee consultants and included within general and administrative expenses.
Restricted Stock Units (“RSUs”)
As of December 31, 2025, the Company had
On February 19, 2026, the Company granted
On March 25, 2026, the Company granted
On March 25, 2026, the Company granted
On June 30, 2026, the Company granted
On September 30, 2026, the Company granted
As of September 30, 2026, the Company had
For the three months ended September 30, 2026 and 2025, the Company recognized share-based compensation expenses of $
As of September 30, 2026, the Company had $
Share Options
For the three months ended September 30, 2026 and 2025, the Company did not grant any options.
The Company recognizes compensation expenses related to options on a straight-line basis over the vesting periods. For the three months ended September 30, 2026 and 2025, the Company recognized share-based compensation expenses of $nil and $
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Preference shares
On August 18, 2026, the Company granted
Other share-based compensation
Bit Digital Equity Incentive Plan
For the three months ended September 30, 2026 and 2025, the Company recognized share-based compensation expenses of $nil and $
In March 2026, the Company granted
For the three months ended September 30, 2026 and 2025, WhiteFiber recognized share-based compensation expenses of $nil and $
WhiteFiber Equity Incentive Plan
For the three months ended March 31, 2026, WhiteFiber granted
For the three months ended June 30, 2026, WhiteFiber granted
For the three months ended September 30, 2026, WhiteFiber granted
For the three months ended September 30, 2026 and 2025, WhiteFiber recognized total share-based compensation expenses of $
As of September 30, 2026, WhiteFiber had
15. SHARE CAPITAL
Ordinary shares
As of December 31, 2025, there were
In May 2022, the Company entered into an At-the-Market Offering Agreement with H.C. Wainwright & Co., LLC relating to the Company’s ordinary shares. In accordance with the terms of the sales agreement, the Company may offer and sell ordinary shares having an aggregate offering price of up to $
On April 29, 2025, the Company filed a registration statement on Form S-3 (No. 333-286841) to register up to $
In June 2025, the Company completed an underwritten public offering of its ordinary shares registered under the Registration Statement. In accordance with the terms of the underwriting agreement entered into with B. Riley Securities, Inc., as representative of the several underwriters, the Company sold
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In July, 2025, the Company entered into a placement agency agreement (the “Placement Agent Agreement”) with B. Riley Securities, Inc. (the “Placement Agent”), pursuant to which the Placement Agent agreed to serve as the sole placement agent for the Company in connection with a registered direct offering (the “Registered Direct Offering”) of an aggregate of
On September 29, 2025, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Barclays Capital Inc., Cantor Fitzgerald & Co. and B. Riley Securities, Inc. as representatives of the several underwriters named in Schedule I thereto, in connection with the issuance and sale of $
On October 2, 2025, the Company issued the Notes. The Notes were issued pursuant to, and are governed by, an indenture (the “Base Indenture”), dated as of October 2, 2025, between the Company and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”), as supplemented by a supplemental indenture (the “Supplemental Indenture,” and the Base Indenture, as supplemented by the Supplemental Indenture, the “Indenture”), dated as of October 2, 2025, between the Company and the Trustee.
On August 28, 2026, certain members of management voluntarily surrendered
During the nine months ended September 30, 2026,
As of September 30, 2026, there were
Preference shares
As of September 30, 2026 and December 31, 2025, the Company had
On August 18, 2026, the Company issued an additional
The preference shares are entitled to the following preference features: 1) an annual dividend of
On December 20, 2024, the Board of Directors declared an
On February 19, 2026, the Board of Directors declared an eight (
Treasury stock
The Company treats ordinary shares withheld for tax purposes on behalf of employees in connection with the vesting of restricted share grants as ordinary share repurchases because they reduce the number of ordinary shares that would have been issued upon vesting. For the nine months ended September 30, 2026 and 2025, the Company withheld nil ordinary shares that were surrendered to the Company for withholding taxes related to restricted stock vesting valued at $nil, based on fair value of the withheld shares on the vesting date.
As of September 30, 2026 and December 31, 2025, the Company had treasury stock of $
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16. GOODWILL AND INTANGIBLE ASSETS
Goodwill
The components of goodwill as of September 30, 2026 are as follows:
| As of September 30, 2026 | ||||
| Enovum Data Centers Corp. | $ | |||
| Total goodwill | $ | |||
Finite-lived intangible assets
Finite-lived intangible assets consist of customer relationships. Intangible assets with definite lives are amortized over their estimated useful lives.
The following table presents the Company’s finite-lived intangible assets as of September 30, 2026:
| As of September 30, 2026 | ||||||||||||
| Cost | Accumulated amortization | Net | ||||||||||
| Customer relationships | $ | $ | ( | ) | $ | |||||||
| Total | $ | $ | ( | ) | $ | |||||||
The following table presents the Company’s finite-lived intangible assets as of December 31, 2025:
| As of December 31, 2025 | ||||||||||||
| Cost | Accumulated amortization | Net | ||||||||||
| Customer relationships | $ | $ | ( | ) | $ | |||||||
| Total | $ | $ | ( | ) | $ | |||||||
The following table presents the Company’s estimated future amortization of finite-lived intangible assets as of September 30, 2026:
| 2026 | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| Thereafter | ||||
| Total | $ |
Amortization expense for finite-lived intangible assets for the three months ended September 30, 2026 and September 30, 2025 was $
17. INCOME TAXES
The following table provides details of income taxes:
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Income (loss) before income taxes | $ | $ | $ | ( | ) | $ | ||||||||||
| Provision for income taxes | $ | $ | $ | $ | ||||||||||||
| Effective tax rate | % | % | ( | )% | % | |||||||||||
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The effective tax rate was
Numerous foreign jurisdictions have enacted legislation to adopt a minimum effective tax rate described in the Global Anti-Base Erosion, or Pillar Two, model rules issued by the Organization for Economic Co-operation and Development (“OECD”). Under such rules, a minimum effective tax rate of
On January 5, 2026, the OECD released comprehensive administrative guidance on the “side-by-side system” to streamline Pillar Two’s global minimum tax rules, which would exclude U.S. parented groups from certain Pillar Two provisions in recognition of existing U.S. minimum tax rules. The side-by-side safe harbor election will be effective beginning in 2026, once adopted into domestic legislation, with the transitional safe harbor extended through 2027 to facilitate the implementation of this permanent system. Overall, the rules are not expected to have a material adverse impact on our results of operations, financial position, or cash flows. On July 4, 2025, the One Big Beautiful Bill Act was signed into law in the U.S., which contains a broad range of tax reform provisions affecting businesses. The legislation did not have a material impact on our financial statements.
18. EARNINGS (LOSS) PER SHARE
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net income (loss) attributable to Bit Digital shareholders | $ | $ | $ | ( | ) | $ | ||||||||||
| Adjustment (a) | - | - | ( | ) | - | |||||||||||
| Net income (loss) attributable to Bit Digital common shareholders | $ | $ | $ | ( | ) | $ | ||||||||||
| Weighted average number of ordinary share outstanding | ||||||||||||||||
| Basic | ||||||||||||||||
| Diluted | ||||||||||||||||
| Earnings (loss) per share | ||||||||||||||||
| Basic | $ | $ | $ | ( | ) | $ | ||||||||||
| Diluted | $ | $ | $ | ( | ) | $ | ||||||||||
| (a) |
Basic earnings (loss) per share is computed by dividing net income (loss) attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. The computation of diluted net loss per share does not include dilutive ordinary share equivalents in the weighted average shares outstanding, as they would be anti-dilutive.
For the three months ended September 30, 2026, the dilutive effect of
For the nine months ended September 30, 2026,
For the three and nine months ended September 30, 2026, approximately
For the three and nine months ended September 30, 2025,
19. SEGMENT REPORTING
The Company has
Gross profit (loss) is the segment performance measure the chief operating decision maker (“CODM”) uses to assess the Company’s reportable segments.
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The digital asset mining segment generates revenue from the bitcoin the Company earns through its mining activities. Cost of revenue consists primarily of direct production costs of mining operations, including electricity, management fee and maintenance cost but excluding depreciation and amortization.
The cloud services segment generates revenue from providing high performance computing services to support generative AI workstreams. Cost of revenue consists of direct production costs, including electricity costs, data center lease expense, GPU servers lease expense, third-party customer support fees and other relevant costs, but excluding depreciation and amortization.
Colocation services generate revenue by providing customers with physical space, power and cooling within the data center facility. Cost of revenue consists of direct production costs related to our HPC data center services, including electricity costs, lease costs, data center employees’ wage expenses and other relevant costs, but excluding depreciation and amortization.
The Ethereum staking segment generates revenue from both native staking and liquid staking. Cost of revenue consists of direct cost related to ETH staking business including service fee and reward-sharing fees to the service providers.
The CODM analyzes the performance of the segments based on reportable segment revenue and reportable segment cost of revenue. No operating segments have been aggregated to form the reportable segments.
Other than the $
All Other revenue is generated from equipment leases with external customers.
All revenue and cost of revenue from intersegment transactions have been eliminated in the condensed consolidated statements of operations.
The following tables present segment revenue and segment gross profit reviewed by the CODM:
Three Months Ended September 30, 2026
| Digital asset mining | Cloud services | Colocation services | ETH staking | Total | ||||||||||||||||
| Revenue from external customers | $ | $ | $ | $ | $ | |||||||||||||||
| Intersegment revenue | - | - | - | |||||||||||||||||
| Segment revenue | ||||||||||||||||||||
| Reconciliation of revenue | ||||||||||||||||||||
| Other revenue (a) | ||||||||||||||||||||
| Elimination of intersegment revenue | ( | ) | ||||||||||||||||||
| Total consolidated revenue | ||||||||||||||||||||
| Less: | ||||||||||||||||||||
| Electricity costs | - | |||||||||||||||||||
| Profit sharing fees | - | - | - | |||||||||||||||||
| Data center lease expense | - | - | ||||||||||||||||||
| GPU lease expense | - | - | - | |||||||||||||||||
| Wage expense | - | - | - | |||||||||||||||||
| Service costs - ETH staking | - | - | - | |||||||||||||||||
| Third-party customer support fees | - | - | - | |||||||||||||||||
| Other segment items (b) | - | |||||||||||||||||||
| Intersegment cost of revenue | - | - | - | |||||||||||||||||
| Segment cost of revenue | ||||||||||||||||||||
| Reconciliation of cost of revenue | ||||||||||||||||||||
| Elimination of intersegment cost of revenue | ( | ) | ||||||||||||||||||
| Total consolidated cost of revenue | ||||||||||||||||||||
| Segment gross profit | $ | $ | $ | $ | $ | |||||||||||||||
| (a) | Other revenue is primarily attributable to equipment leasing revenue and is therefore not included in the total for segment gross profit. |
| (b) | All amounts included within other segment items are individually insignificant. |
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Three Months Ended September 30, 2025
| Digital asset mining | Cloud services | Colocation services | ETH staking | Total | ||||||||||||||||
| Revenue from external customers | $ | $ | $ | $ | $ | |||||||||||||||
| Reconciliation of revenue | ||||||||||||||||||||
| Other revenue (a) | ||||||||||||||||||||
| Total consolidated revenue | ||||||||||||||||||||
| Less: | ||||||||||||||||||||
| Electricity costs | - | |||||||||||||||||||
| Profit sharing fees | - | - | - | |||||||||||||||||
| Data center lease expense | - | - | ||||||||||||||||||
| GPU lease expense | - | - | - | |||||||||||||||||
| Wage expense | - | - | - | |||||||||||||||||
| Service costs - ETH staking | - | - | - | |||||||||||||||||
| Other segment items (b) | - | |||||||||||||||||||
| Segment cost of revenue | ||||||||||||||||||||
| Segment gross profit | $ | $ | $ | $ | $ | |||||||||||||||
| (a) | Other revenue is primarily attributable to equipment leasing revenue and is therefore not included in the total for segment gross profit. |
| (b) | All amounts included within other segment items are individually insignificant. |
Nine Months Ended September 30, 2026
| Digital asset mining | Cloud services | Colocation services | ETH staking | Total | ||||||||||||||||
| Revenue from external customers | $ | $ | $ | $ | $ | |||||||||||||||
| Intersegment revenue | - | - | - | |||||||||||||||||
| Segment revenue | ||||||||||||||||||||
| Reconciliation of revenue | ||||||||||||||||||||
| Other revenue (a) | ||||||||||||||||||||
| Elimination of intersegment revenue | ( | ) | ||||||||||||||||||
| Total consolidated revenue | ||||||||||||||||||||
| Less: | ||||||||||||||||||||
| Electricity costs | - | |||||||||||||||||||
| Profit sharing fees | - | - | - | |||||||||||||||||
| Data center lease expense | - | - | ||||||||||||||||||
| GPU lease expense | - | - | - | |||||||||||||||||
| Wage expense | - | - | - | |||||||||||||||||
| Service costs - ETH staking | - | - | - | |||||||||||||||||
| Third-party customer support fees | - | - | - | |||||||||||||||||
| Other segment items (b) | - | |||||||||||||||||||
| Intersegment cost of revenue | - | - | - | |||||||||||||||||
| Segment cost of revenue | ||||||||||||||||||||
| Reconciliation of cost of revenue | ||||||||||||||||||||
| Elimination of intersegment cost of revenue | ( | ) | ||||||||||||||||||
| Total consolidated cost of revenue | ||||||||||||||||||||
| Segment gross profit | $ | $ | $ | $ | $ | |||||||||||||||
| (a) |
| (b) |
48
Nine Months Ended September 30, 2025
| Digital asset mining | Cloud services | Colocation services | ETH staking | Total | ||||||||||||||||
| Revenue from external customers | $ | $ | $ | $ | $ | |||||||||||||||
| Reconciliation of revenue | ||||||||||||||||||||
| Other revenue (a) | ||||||||||||||||||||
| Total consolidated revenue | ||||||||||||||||||||
| Less: | ||||||||||||||||||||
| Electricity costs | - | |||||||||||||||||||
| Profit sharing fees | - | - | - | |||||||||||||||||
| Data center lease expense | - | - | ||||||||||||||||||
| GPU lease expense | - | - | - | |||||||||||||||||
| Wage expense | - | - | - | |||||||||||||||||
| Service costs - ETH staking | - | - | - | |||||||||||||||||
| Other segment items (b) | - | |||||||||||||||||||
| Segment cost of revenue | ||||||||||||||||||||
| Segment gross profit | $ | $ | $ | $ | $ | |||||||||||||||
| (a) | Other revenue is primarily attributable to Equipment Leasing and is therefore not included in the total for segment gross profit. |
| (b) | All amounts included within Other segment items are individually insignificant. |
The following table presents the reconciliation of segment gross profit to net (loss) income before taxes:
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Segment gross profit | $ | $ | $ | $ | ||||||||||||
| Reconciling Items: | ||||||||||||||||
| Other profit (a) | ||||||||||||||||
| Depreciation and amortization expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Impairment of capitalized software assets | - | - | ( | ) | - | |||||||||||
| General and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Gains (losses) on digital assets | ( | ) | ||||||||||||||
| Gains on digital intangible assets | - | - | ||||||||||||||
| Impairment of digital intangible assets | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net gain (loss) from disposal of property and equipment | ( | ) | ( | ) | ||||||||||||
| Induced conversion expense | ( | ) | - | ( | ) | - | ||||||||||
| Other income (expense), net | ( | ) | ||||||||||||||
| Change in fair value of derivative liability | - | - | ||||||||||||||
| Interest expense | ( | ) | - | ( | ) | - | ||||||||||
| Net income (loss) before taxes | ( | ) | ||||||||||||||
| (a) |
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20. RELATED PARTIES
Related-party transactions
On December 20, 2024, the Board of Directors declared an eight (
On February 19, 2026, the Board of Directors declared an eight (
On August 11, 2026, the Board of Directors approved the issue of an additional
WhiteFiber AI’s subsidiary, WhiteFiber Iceland ehf, appointed Daniel Jonsson as its part-time Chief Executive Officer starting November 7, 2023, for a six-month term with a three-month probation. After the initial period, the employment shall be automatically renewed for successive period(s) of 6 months each, unless agreed otherwise in writing or unless terminated earlier in accordance with the terms of the employment agreement. His compensation includes a monthly salary of $
Corporate Restructuring and Capital Contributions
Prior to the consummation of the WhiteFiber initial public offering (the “Offering”), the Company entered into a Contribution Agreement with WhiteFiber, pursuant to which the Company contributed its HPC business through the transfer of
On August 8, 2025, WhiteFiber, a subsidiary of the Company, completed the Offering of
Transition Services Agreement
In addition, prior to the consummation of the Offering, the Company entered into a Transition Services Agreement with WhiteFiber, pursuant to which the Company will provide certain services to WhiteFiber, on a transitional basis which will generally be up to 24 months following the effective date of WhiteFiber’s IPO registration statement. The Transition Services Agreement provides for the performance of certain services by the Company for the benefit of WhiteFiber, or in some cases certain services provided by WhiteFiber for the benefit of the Company, for a limited period of time after the Offering, including certain services provided by Sam Tabar, our Chief Executive Officer, and Erke Huang, our Chief Financial Officer and a Director. During such transition period, Messrs. Tabar and Huang will continue to hold the same position with the Company as well as WhiteFiber. Messrs. Tabar and Huang have committed to provide the requisite time and effort to fulfill their responsibilities as full-time officers of WhiteFiber, supervising a full staff and are expected to provide certain services, representing not more than approximately 30% of their working time, in respect of the Company’s operations. As of August 1, 2026, Mr. Justin Zhu was named as the Chief Financial Officer of WhiteFiber as Mr. Huang has relinquished his position and is only serving as Chief Financial Officer of Bit Digital. The services to be provided will include financial reporting, tax, legal, human resources, information technology and other general and administrative functions. All services are to be provided at cost, except if otherwise agreed to. Following WhiteFiber’s IPO, WhiteFiber’s related intercompany balances are expected to be settled in cash or reflected as a payable arrangement, rather than the historical parent investment treatment used before WhiteFiber’s IPO. For the three and nine months ended September, 30, 2026, the fees for these services were $
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Guarantees
The Company previously issued a guarantee to a third party on behalf of WhiteFiber Iceland ehf, making the Company jointly and severally liable for WhiteFiber Iceland’s payment obligations related to hosting Services fees and electrical costs pursuant to a colocation agreement.
On September 25, 2025, the guarantee was assumed by WhiteFiber which became directly responsible for such obligations. Following the assumption, the Company is no longer a guarantor under the agreement.
On March 25, 2026, WhiteFiber Iceland ehf. (the “Borrower”), a subsidiary of WhiteFiber, entered into a secured term loan facility agreement (the “Facility”) with Landsbankinn hf, which provides for borrowings of up to $
On May 20, 2026, Enovum NC-1 Venture, LLC (the “Borrower”), a subsidiary of WhiteFiber, entered into a Delayed Draw Term Loan Facility and Security Agreement (the “Delayed Draw Term Loan Facility”) with Bit Digital Capital, Inc. (the “Lender”), a subsidiary of the Company, providing up to $
On July 15, 2026 Enovum NC-Bidco, LLC (the “Principal”), a subsidiary of WhiteFiber, entered into a $
Consulting Agreement with Affiliate of Director
On June 18, 2025, the Company entered into a consulting agreement with Serotonin Inc. (“Serotonin”). Amanda Cassatt, a director of the Company, is a principal of Serotonin and has an ownership interest in the entity. Under the consulting agreement, Serotonin provides consulting and advisory services to the Company. The agreement has an initial term of six months, expiring on December 18, 2025, and automatically renews for successive six-month periods unless terminated by either party upon at least thirty (30) days’ prior written notice. The agreement may also be terminated for cause, as defined in the agreement. Pursuant to the agreement, Serotonin assigned to the Company all right, title and interest worldwide in any work product developed in connection with the services. The agreement also contains a non-solicitation provision that remains in effect for
Administrative Services Agreement with Affiliate of Management
On December 1, 2025, Financière Marjos SCA, an indirect subsidiary of the Company, entered into an administrative services agreement with Le Square SARL (“Square”). Square is wholly owned by Philippe Gellman, who also serves as the Manager of Financière Marjos, and therefore the agreement constitutes a related party transaction.
Pursuant to the agreement, Square provides administrative support services to Financière Marjos, including coordinating with external advisors, assisting with the preparation and centralization of information for financial reporting and annual closings, supporting the preparation of forecasts and budgets, monitoring relationships with banking institutions, and assisting with the management of disputes and other administrative matters. Square may perform these services directly or in coordination with the executives, employees and service providers of Financière Marjos.
In consideration for the services provided under the agreement, Square receives a monthly fee of €
The agreement became effective on December 1, 2025 and continues for an indefinite term. The agreement may be terminated by Financière Marjos at any time without prior notice or by Square upon two months’ prior written notice. The agreement also includes customary confidentiality, non-solicitation and non-disparagement provisions.
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21. COMMITMENTS AND CONTINGENCIES
Legal Proceedings
The Company from time to time may become involved in legal proceedings in the ordinary course of the Company’s business. The Company may also pursue litigation to assert its legal rights and assets, and such litigation may be costly and divert the efforts and attention of its management and technical personnel, which could adversely affect its business. Due to the uncertainty of litigation and depending on the amount and the timing, an unfavorable resolution of some or all of such matters may materially affect the Company’s business, results of operations, financial position, or cash flows.
Although the Company cannot predict the outcome of legal or other proceedings with certainty, where there is at least a reasonable possibility that a loss may have been incurred, U.S. GAAP requires the Company to disclose an estimate of the reasonably possible loss or range of loss or make a statement that such an estimate cannot be made. The Company follows a thorough process in which it seeks to estimate the reasonably possible loss or range of loss, and only if it is unable to make such an estimate does it conclude and disclose that an estimate cannot be made. Accordingly, unless otherwise indicated below in the Company’s discussion of legal proceedings, a reasonably possible loss or range of loss associated with any individual legal proceeding cannot be estimated.
Bit Digital USA, Inc v. Blockfusion USA, Inc. – Superior Court of Delaware
On June 3, 2024, the Company filed suit in Delaware Superior Court against Blockfusion USA, Inc. (“Blockfusion”) alleging claims for breach of contract, conversion, and related claims in connection with, among other things, certain deposits and advances paid to Blockfusion, the return of which is owed to Bit Digital. Bit Digital was seeking in excess of $
On March 18, 2026, the Company moved to dismiss two of the four counterclaims that Blockfusion reasserted in its February 11, 2026 answer to the Second Amended Complaint. The Court heard argument on that motion on June 12, 2026. On August 14, 2026, the Court granted the motion in part and denied it in part, dismissing Blockfusion’s counterclaim for breach of the implied covenant of good faith and fair dealing and declining to dismiss its counterclaim for breach of an alleged post-termination agreement. Blockfusion’s counterclaims for breach of contract, breach of the alleged post-termination agreement, and declaratory judgment remain pending. On those counterclaims, Blockfusion seeks damages of not less than $
The litigation is ongoing and remains in an active pretrial phase. The parties are engaged in discovery. No trial date has been set. The Company seeks recovery of its original investment, allegedly improper invoice payments, unpaid contractual amounts, and other damages. The aggregate damages sought exceed $
At this time, the Company cannot reasonably estimate a possible loss, range of loss, or expected recovery associated with this litigation.
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Bit Digital USA, Inc. v. Alex Martini-Lo Manto, et. al. – New York Supreme Court, New York County, Commercial Division
On March 4, 2026, the Company filed suit against Alex Martini-Lo Manto, CEO of Blockfusion; Blockfusion; Blockfusion Data Centers, Inc. (now known as Blockfusion Digital Infrastructure, Inc.), the entity that would become the publicly traded parent upon completion of the proposed business combination; and Blue Acquisition Corp., the Special Purpose Acquisition Company (“SPAC”) that is party to the proposed business combination, alleging that the defendants had designed the SPAC merger to avoid paying the Company for Blockfusion’s prejudgment liabilities. The suit asserted claims under the New York Uniform Voidable Transactions Act, fraud claims against defendant Martini-Lo Manto, and a successor-liability claim against the proposed post-combination public company.
Upon filing, the Company also moved for a preliminary injunction enjoining the SPAC transaction. On April 15, 2026, the Court denied that motion. The Company appealed that ruling, and the appeal was subsequently resolved as described below.
On April 29, 2026, Blue Acquisition Corp. and the other defendants filed separate motions to dismiss the Company’s claims. The Company filed its opposition on May 13, 2026.
On July 23, 2026, the Court issued a decision granting the motions in part and denying them in part. The Court dismissed the Company’s claims under the New York Uniform Voidable Transactions Act, which were the only claims asserted against Blockfusion and Blue Acquisition Corp., but permitted the Company’s successor-liability claim against the proposed post-combination public company to proceed. With respect to the fraud claims against Mr. Martini-Lo Manto, the Court permitted the claim based on allegedly fraudulent invoices to proceed and dismissed the remaining fraud claims. In August 2026, the Company agreed to stay its successor-liability claim pending the closing of the proposed business combination. The Company has not moved for leave to replead the dismissed claims or appealed their dismissal.
The litigation is ongoing and remains in an active pretrial phase. The parties are engaged in discovery. Under the Court’s scheduling orders, document production is to be substantially completed by January 8, 2027, fact depositions are to be completed by February 17, 2027, and the note of issue is to be filed by March 10, 2027. The remaining fraud claim seeks damages of not less than $
At this time, the Company cannot reasonably estimate a possible loss, range of loss, or expected recovery associated with this litigation.
Bit Digital USA, Inc. v. Alex Martini-Lo Manto, et. al. – New York Supreme Court, Appellate Division, First Department
On April 21, 2026, the Company filed a notice of appeal from the Commercial Division’s denial of the preliminary injunction. The Company also filed a request for interim appellate injunctive relief. On May 22, 2026, the Appellate Division issued an interim order, pending determination of the application by a full panel, directing the defendants to escrow $
According to Current Reports on Form 8-K filed by Blue Acquisition Corp., the parties to the business combination agreement amended it on September 2, 2026 to provide that either Blue Acquisition Corp. or Blockfusion may, subject to certain exceptions, terminate the agreement if the conditions to closing have not been satisfied or waived by November 30, 2026, and amended it further on September 21, 2026 without changing that date.
At this time, the Company cannot reasonably estimate a possible loss, range of loss, or expected recovery associated with this litigation.
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Contingent Consideration Liabilities
Unifi Transaction
As part of the Unifi Transaction (See Note 4. Acquisition), WhiteFiber may be required to make additional contingent payments to the seller based on the timing and availability of electric service to the property, as follows:
| ● | A contingent payment of $ |
| ● | If an Electric Service Agreement for at least |
| ● | If an Electric Service Agreement is provided, or the property receives more than |
As of September 30, 2026, WhiteFiber has not received an Electric Service Agreement of at least or more than
Electric Service Agreement with Duke Energy
An existing Electric Service Agreement (“ESA”) with Duke Energy Carolinas, LLC (“Duke Energy”) for the provision of electric power to the facility located at 805 Island Drive, Madison, North Carolina was assigned to WhiteFiber’s wholly owned subsidiary, Enovum NC-1 Bidco LLC, from Unifi as of August 4, 2025.
The ESA establishes a minimum monthly bill for electric service, based on Duke Energy’s Rate of $
The ESA represents a continuing commitment to purchase power at or above the established minimum levels throughout the contract term. As such, WhiteFiber is obligated to pay the minimum monthly charges regardless of operational activity.
Under the termination clause, either party may cancel the ESA with at least
On July 15, 2026, the Company obtained a $
As of September 30, 2026, management has no present intention to reduce operations at Madison or terminate the ESA. Accordingly, no liability has been recognized in the financial statements in connection with the ESA.
22. SUBSEQUENT EVENTS
The Company has evaluated subsequent events through the date of issuance of these unaudited condensed consolidated financial statements and determined that, except as disclosed below, there were no subsequent events requiring recognition or disclosure in the financial statements.
Additional Borrowing under Galaxy Loan Facility
Subsequent to September 30, 2026, the Company drew down an additional $
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Additional Advance Under Delayed Draw Term Loan Facility
On October 27, 2026, WhiteFiber received an additional advance of $
Real Estate Acquisition – Yadkinville, North Carolina
On August 16, 2026, WhiteFiber entered into a Real Estate Purchase and Sale Agreement with Unifi Manufacturing, Inc. (the “Yadkinville Agreement”) to acquire two properties consisting of land, buildings and related improvements and certain machinery and equipment located in Yadkinville, North Carolina. The total consideration is $
The properties comprise approximately 120 acres of land and 500,000 square feet of existing warehouse space and are expected to provide a combined minimum of 60 MW of initial gross electrical power capacity, with the potential to support up to approximately 200 MW within seven years following closing, subject to confirmation and power availability. WhiteFiber intends to develop the properties into data center campuses.
In connection with the agreement, the seller may become entitled to additional contingent consideration of up to $
Following closing, the seller will continue to occupy portions of the properties under short-term occupancy arrangements and subsequently lease back a portion of one property for a five-year term.
NC-1 Project Financing
On November 9, 2026, WhiteFiber’s indirect wholly owned subsidiaries, Enovum NC-1 Midco, LLC (“Holdings”) and Enovum NC-1 Bidco, LLC (the “Borrower”), entered into a Term Loan Credit Agreement (the “NC-1 Credit Agreement”) with Morgan Stanley Senior Funding, Inc., as administrative agent and collateral agent, and a consortium of lenders party thereto, providing a $
Loans bear interest, at the Borrower’s election, at Term SOFR (subject to a
Forward Looking Statements
The discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed financial statements and the related notes included elsewhere in this report. Except for the statements of historical fact, this report contains “forward-looking information” and “forward-looking statements reflecting our current expectations that involve risks and uncertainties (collectively, “forward-looking information”) that is based on expectations, estimates and projections as at the date of this Form 10-Q. All statements, other than statements of historical fact, included herein are “forward-looking statements.” These forward-looking statements are often identified by the use of forward-looking terminology such as “believes,” “intends,” “expects,” or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described under “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025 (Annual Report) and any subsequently filed Quarterly Reports on Form 10-Q and any Current Reports on Form 8-K. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this report.
The following discussion may contain forward-looking statements that reflect the Company’s plans, estimates and beliefs. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. If any material risk were to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline and you could lose part of all of your investment. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the company does not assume a duty to update these forward-looking statements.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q for the period ended September 30, 2026 as well as Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Form 10-K for the year ended December 31, 2025 (“Form 10-K”). This discussion contains forward-looking statements reflecting our current expectations that involve risks and uncertainties. See “Cautionary Note Regarding Forward-Looking Statements and Risk Factors” for a discussion of the uncertainties, risks, and assumptions associated with these statements. Actual results and the timing of events could differ materially from those discussed in our forward-looking statements as a result of many factors, including those set forth under “Risk Factors” and elsewhere in this Quarterly Report.
Overview
Bit Digital, Inc. (“BTBT” or the “Company” or “We”), is a holding company incorporated on February 17, 2017, under the laws of the Cayman Islands. The Company is a strategic asset company focused on active participation in Ethereum (ETH)-native treasury and staking strategies. Through our majority equity stake in WhiteFiber Inc. (Nasdaq: WYFI), the Company also engages in high performance computing (“HPC”) business, including cloud services and HPC data center services.
HPC Business
The Company’s HPC business operates under the WhiteFiber brand. WhiteFiber believes it is a leading provider of artificial intelligence (“AI”) infrastructure solutions. WhiteFiber owns HPC data centers and provides cloud-based HPC graphics processing units (“GPU”) services, which it terms cloud services, for customers such as AI application and machine learning (“ML”) developers (the “HPC Business”). Its Tier-3 data centers provide hosting and colocation services. WhiteFiber cloud services support generative AI workstreams, especially training and inference.
WhiteFiber’s business model integrates its data center infrastructure and cloud services to provide scalable, high-performance computing solutions for enterprises, research institutions, and AI and ML driven businesses. Its integrated approach aligns specialized data center operations with GPU-focused cloud services, addressing the unique requirements of AI and ML workloads. These workloads demand greater power density, advanced cooling solutions, and robust bandwidth to handle large-scale data transfers. By operating its data centers, it is able to provide the power to support its cloud services and WhiteFiber believes it can better meet the needs of AI and ML workloads and reduce the complexity associated with procuring power and connectivity from external vendors. WhiteFiber can also design its facilities to accommodate the higher heat loads generated by modern GPUs, potentially shortening deployment timelines for customers who require rapid expansion of their computing infrastructure. From a financial standpoint, WhiteFiber’s vertically integrated solution allows it to capture additional margin for both its data center and cloud services businesses, avoiding expenses that would otherwise be due to third-party providers.
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Colocation/Data center services
WhiteFiber designs, develops, and operates data centers, through which it offers its hosting and colocation services. WhiteFiber’s operational data centers meet the requirements of the Tier-3 standard, including N+1 redundancy architecture, concurrent maintainability, uninterruptible power supply, advanced and highly reliable cooling systems, strict monitoring and management systems, 99.982% uptime and no more than 1.6 hours of downtime annually, service organization control, SOC 2 Type 2, differentiated software supporting AI workloads, high density and robust bandwidth, and infrastructure to support AI workloads.
Drawing on collective industry experience, WhiteFiber’s data center team is adept at bringing new sites online on an accelerated timeline. WhiteFiber is aggressively pursuing the development pipeline and intends to achieve an estimated 65 MW (gross) of operational data center capacity by the end of the fourth quarter of 2026, a target that is underpinned by assets including the MTL-1, MTL-3, and NC-1 facilities. WhiteFiber also has an additional 65 MW (gross) in development at its MTL-2 facility and Yadkinville properties. As of September 30, 2026, its pipeline of potential data center projects represents approximately 1,500 MW (gross) under management review. WhiteFiber follows a disciplined process prioritizing projects that are backed by customer lease commitments. In select cases, WhiteFiber may pursue early-stage acquisitions based on strong customer demand signals and defined commercialization pathways. Accordingly, the foregoing timelines and capacities are subject to change based on many factors, many of which are outside of WhiteFiber’s control.
WhiteFiber uses a well-defined set of criteria to select their data center sites. WhiteFiber typically target sites with proximity to metro areas and partial infrastructure in place, where it is retrofitting rather than developing greenfield projects. Metropolitan areas are positioned for low-latency to address long-term, specialized AI computer inference needs, and smaller sites reduce risks. A retrofit entails sourcing and acquiring an existing industrial building with underutilized, in-place power connectivity. The period of time from when a site is purchased until construction can begin varies from location to location depending upon, among other things, obtaining required permits and the availability of construction supplies and contractors. Average build time for retrofits is intended to be approximately six months from commencement of construction, which WhiteFiber believes is approximately one-third to one-half of the industry average development timeline for greenfield projects. This average building time is based upon senior management’s experience at Enovum prior to its acquisition by WhiteFiber, as well as their experience prior to Enovum. WhiteFiber also prioritize sites offering opportunities to increase site power over time, enabling its data centers to grow with customer demand. In addition, WhiteFiber selectively targets certain larger opportunities with 50 MW (gross) of power or more, subject to customer demand, to drive AI-driven compute super-clusters. Finally, WhiteFiber prioritize sites powered by sustainable, green energy sources and locked-in power when available. Additionally, to enhance sustainability of certain WhiteFiber data center projects, WhiteFiber is undertaking heat repurposing projects in connection with sustainability and commercial and residential projects.
WhiteFiber acquired Enovum on October 11, 2024. The transaction included the lease of MTL-1, its 4 MW (gross) Tier-3 high-performance computing (“HPC”) data center in Montreal, Canada, which was fully operational and fully leased to customers at the time of acquisition.
On December 27, 2024, WhiteFiber acquired the real estate and building for a build-to-suit 5 MW (gross) Tier-3 data center expansion project near Montreal, Canada which it refers to as MTL-2. MTL-2, a 160,000 square foot site that was previously used as an encapsulation manufacturing facility, is located in Pointe-Claire, Quebec. WhiteFiber initially funded the purchase of CAD 33.5 million (approximately $23.3 million) with cash on hand. WhiteFiber expected to invest approximately $23.6 million to develop the site to Tier-3 standards with an initial load of 5 MW (gross). Construction is expected to begin during the fourth quarter of 2026.
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On April 11, 2025, WhiteFiber entered into a lease for a new data center site in Saint-Jerome, Quebec, a suburb of Montreal, MTL-3. The MTL-3 facility spans approximately 202,000 square feet on 7.7 acres and is being developed into a 7 MW (gross) Tier-3 data center. It will support current contracted capacity, with Cerebras (5 MW IT Load), with future expansion potential subject to utility approvals. The transaction was executed under a lease-to-own structure, which includes a fixed-price purchase option of CAD 24.2 million (approximately $17.3 million) exercisable by December 2025. The lease term was 20 years, with two 5-year extensions at the Company’s option. In December 2025, WhiteFiber became reasonably certain to exercise the purchase option and notified the lessor of its intent to exercise the purchase option. WhiteFiber had 90 days to complete the purchase, after which the purchase option would expire. The option was exercised on January 14, 2026 and the purchase of MTL-3 closed on May 8, 2026. The facility has been retrofitted to Tier-3 standards and was completed and operational in November 2025. The site has commenced billing Cerebras as of November 1, 2025, in the amount of CAD 1.4 million (approximately $1.0 million USD) monthly for the duration of the five-year contract.
On May 20, 2025, WhiteFiber completed the purchase of a former industrial/manufacturing building from UMI. Pursuant to the Purchase Agreement WhiteFiber agreed to purchase from UMI, an industrial/manufacturing building together with the underlying land located in Madison, North Carolina, which WhiteFiber refers to as “NC-1”, as well as certain machinery and equipment located thereon for a cash purchase price of $45 million. The purchase price will increase by (i) $8 million, if Duke Energy actually provides, or provides an Electric Services Agreement providing for, at least 99 MW (gross) within two years of May 20, 2025, or (ii) $5 million, if Duke Energy actually provides, or provides an Electric Services Agreement providing for, at least 99 MW (gross) more than two years but less than three years after May 20, 2025. Additionally, the purchase price will increase by an additional $200 thousand per MW over 99 MW (gross) up to a maximum of $5 million if at least 99 MW (gross) are actually delivered, or Duke Energy provides an Electric Services Agreement for the provision of at least 99 MW (gross), within four years of May 20, 2025. Separately, the Company entered into a Capacity Agreement with Duke Energy pursuant to which Duke Energy agreed to use commercially reasonable efforts to achieve 24 MW (gross) of service to NC-1 by September 1, 2025, 40 MW (gross) by April 1, 2026, and 99 MW (gross) within four years of May 16, 2025. Management believes based upon its review of the site and a Duke Energy preliminary transmission study, that NC-1 may receive and support up to 200 MW (gross) of total electrical supply over an extended period of time, subject to infrastructure upgrades, such as developing new substations and other conditions. On August 4, 2025, Enovum NC-1 Bidco LLC, a subsidiary of WhiteFiber, entered into an Assignment and Assumption Agreement with Unifi Manufacturing and Duke Energy Carolinas, LLC, pursuant to which Enovum assumed Unifi’s rights and obligations under certain electric service agreements for facilities located in North Carolina. Duke Energy consented to assignment. Refer to Note 21. Commitments and contingencies to our condensed consolidated financial statements for further detail.
On August 16, 2026, WhiteFiber entered the Yadkinville Agreement to acquire two properties consisting of land, buildings and related improvements and certain machinery and equipment located in Yadkinville, North Carolina. The total consideration is $60.0 million in cash, including a deposit in escrow of $2.25 million. The transaction closed on October 28, 2026. In connection with the acquisition, the seller will continue to occupy portions of the properties under occupancy and partial leaseback arrangements. These arrangements are expected to offset a portion of property carrying costs as WhiteFiber advances its development plans.
As the business grows, WhiteFiber’s ability to fund its operating needs will depend on the ongoing ability to generate positive cash flow from its operations and raise capital in the capital markets. Accordingly, WhiteFiber has entered into certain credit facilities to finance these areas of growth, including the Syndicated RBC Credit Facility Agreement and discussed here. Refer to Liquidity and capital resources for further discussion on this Facility and other credit facilities of WhiteFiber.
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Nscale Services Agreement
In November 2025, WhiteFiber’s wholly owned subsidiary, Enovum NC-1 Bidco, LLC, entered into the Services Agreement with Nscale Services US Inc. and Nscale Global Holdings Limited (collectively, “Nscale”) for the provision of colocation and related services at its NC-1 facility. The agreement represents a significant commercial milestone for the high-density data center platform and provides long-term contracted revenue visibility. The initial Service Order pursuant to the Services Agreement represents approximately $865 million in total contracted revenue over a 10-year term, inclusive of contractual annual rate escalators and non-recurring installation services (“NRCs”). Electricity and certain other operating costs are structured as pass-through charges to Nscale. On August 15, 2026, WhiteFiber commenced billing for the initial 20 MW of contracted capacity at its NC-1 facility, which was subsequently placed into service on September 23, 2026. As of date of this report, the remaining 20 MW became operational, bringing all 40 MW of contracted IT capacity at NC-1 into operation.
Cloud Services
WhiteFiber provides specialized cloud services to support generative AI workstreams, especially training and inference, emphasizing cost-effective utility and tailor-made solutions for each client. WhiteFiber is an authorized NVIDIA Preferred Partner through the NVIDIA Partner Network (“NPN”), an authorized partner with SuperMicro Computer Inc.®, an authorized Communications Service Provider (“CSP”) with Dell (through Dell’s exclusive distributor in Iceland, Advania), an official partnership with Hewlett Packard Enterprise and a commercial relationship with Quanta Computer Inc. (“QCT”). Based on management’s knowledge of the industry, WhiteFiber is proud to be among the first service providers to offer H200, B200, and GB200 servers. WhiteFiber aims to provides a high-standard service lease with an Uptime percentage> 99.5%.
WhiteFiber is also developing a capital-light managed service offering through which customers would fund the underlying hardware while WhiteFiber deploys and operates it on their behalf. This offering has not yet generated material revenue.
Global Data Center Infrastructure and Partnerships
WhiteFiber expects to leverage a global network of data centers for hosting capacity for its GPU business, in many instances, by negotiating with third-party providers to seamlessly integrate its cloud services at strategically located data centers. WhiteFiber’s initial data center partnership through which it leases capacity is at Blönduós Campus, Iceland, offering a world-class operations team with certified technicians and reliable engineers. The facility has a 45 kW rack density and 6 MW (gross) total capacity. WhiteFiber has executed contracts for 5.5 MW IT load at the data center. The center’s energy source is 100% renewable energy, mainly from Blanda Hydro PowerStation, the winner of an IHA Blue Planet Award in 2017.
In addition, WhiteFiber has leased additional data center capacity in Atlanta, Georgia, to expand its cloud services offering with the leases commencing in February 2026. In the third quarter of 2026, WhiteFiber entered into a lease for 2.5 MW IT load design Tier-3 data center space in Sydney, Australia, a lease for 2.7 MW IT load design data center Tier-3+ space in Paris, France, and leases for 2.0 MW and 2.7 MW IT load design data centers in Canada to expand its cloud services offering.
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Customer Base and Concentration
As of the date of this Form 10-Q, WhiteFiber has five existing customers. Its largest customer accounted for approximately 50% of WhiteFiber’s cloud services revenue during the nine months ended September 30, 2026. During the period WhiteFiber had discontinuation of three customer orders. The discontinued orders resulted in approximately $5.1 million impact to revenue during the nine months ended September 30, 2026. However, there were new customer orders contracted in the nine months ended September 30, 2026 and through the date of this Form 10-Q for total contracted revenue of approximately $1,447 million over a six months to five-year period.
Discontinued customer agreements during the nine months ended September 30, 2026 and through the date of this Form 10-Q include: (i) WhiteFiber’s Initial Customer, following execution of the Termination Agreement described below; (ii) a customer whose Master Services Agreement and related purchase order, as previously amended, was terminated in January 2026; and (iii) a customer whose service order, entered into in January 2026, was terminated during the period.
New customer agreements signed during the nine months ended September 30, 2026 and through the date of this Form 10-Q include new service orders entered into with existing customers for additional GPU and CPU/storage capacity, as well as new service orders entered into with new customers, in each case as further described below.
Selected Customer Agreements
The following summaries reflect selected GPU cloud service agreements that were entered into or discontinued during the period, or that WhiteFiber otherwise considers to be material or representative. WhiteFiber has entered into additional agreements that are not individually material and are not included below.
On October 23, 2023, Bit Digital announced that it had commenced AI operations by signing a binding term sheet with a customer (the “Initial Customer”) to support the customer’s GPU workloads. On December 12, 2023, WhiteFiber finalized a Master Services and Lease Agreement (“MSA”), as amended, with its Initial Customer for the provision of cloud services from a total of 2,048 GPUs over a three-year period. To finance this operation, WhiteFiber entered into a sale-leaseback agreement with a third party, selling 96 AI servers (equivalent to 768 GPUs) and leasing them back for three years. The total contract value with the Initial Customer for the aggregated 2,048 GPUs was estimated to be worth more than $50 million of annualized revenue. On January 22, 2024, approximately 192 servers (equivalent to 1,536 GPUs) were deployed at a specialized data center and began generating revenue, and subsequently on February 2, 2024, approximately an additional 64 servers (equivalent to 512 GPUs) also started to generate revenue.
In the second quarter of 2024, WhiteFiber finalized an agreement to supply its Initial Customer with an additional 2,048 GPUs over a three-year period. To finance this operation, WhiteFiber entered into a sale-leaseback agreement with a third party, agreeing to sell 128 AI servers (equivalent to 1,024 GPUs) and leasing them back for three years. In late July, at the customer’s request, WhiteFiber agreed with the customer to temporarily delay the purchase order so the customer could evaluate an upgrade to newer generation Nvidia GPUs. Consequently, WhiteFiber and manufacturer postponed the purchase order. In early August, the customer made a non-refundable prepayment of $30.0 million for the services to be rendered under this agreement.
In January 2025, WhiteFiber entered into an agreement to supply its Initial Customer with an additional 464 GPUs for a period of 18 months. This new agreement replaces the prior agreement whereby WhiteFiber was to provide the customer with an incremental 2,048 H100 GPUs. The contract features a two-month prepayment from the customer. Deployment commenced on August 20, 2025, using WhiteFiber’s inventory of B200 GPUs.
In October 2025, Bit Digital’s existing guaranty arrangement with the Initial Customer was scheduled to expire. Beginning in November 2025, the customer will provide a service deposit to WhiteFiber in lieu of the Bit Digital guaranty. The deposit will be funded through fifteen consecutive monthly payments from November 2025 through January 2027. The deposit will serve as security for the customer’s performance obligations under the amended service agreements. Each monthly payment is expected to be invoiced on the first day of the month and paid within thirty days. WhiteFiber will be required to return the deposit in cash upon termination or expiration of the service agreements, provided that all obligations have been fully satisfied and no payment defaults or material breaches exist.
In the second quarter of 2026, WhiteFiber executed a termination agreement (the “Termination Agreement”) with the Initial Customer. The Termination Agreement preserved $12.5 million of previously invoiced, unpaid trade receivables. This preserved balance was fully collected as of June 30, 2026. Prepayment and service deposit balances were applied against other outstanding receivables and WhiteFiber recognized a bad debt expense of approximately $2.2 million for the unpreserved remaining receivable balance outstanding. Additionally, under the Termination Agreement the Initial Customer is obligated to pay WhiteFiber a fixed termination fee of $12.3 million that was recognized as revenue during the second quarter of 2026. Subsequently, in the third quarter, the termination fee was amended to $15.7 million. The amended amount of $15.7 million was fully collected as of September 30, 2026. Following the service pause and termination of the agreement, WhiteFiber redeployed the GPUs previously allocated to the Initial Customer to other customers.
In November 2025, WhiteFiber terminated the MSA and all related purchase orders with DNA Fund in accordance with the terms of the contract. At the time of termination, we had approximately $7.3 million in outstanding accounts receivable. Pursuant to the termination agreement, the customer agreed to repay the outstanding balance. As of the date of this Form 10-Q, WhiteFiber has collected $2.2 million of the outstanding amount. Approximately $5.1 million remains unpaid. All scheduled installment payments are now past due, and no payments have been received since April 2026. WhiteFiber continues to pursue collection of the remaining balance; however, the timing and amount of any future recoveries remain uncertain.
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On November 6, 2024, WhiteFiber entered into a Master Services Agreement (“MSA”) with a minimum purchase commitment of 16 GPUs, along with an associated purchase order, from a new customer. The purchase order provides for services utilizing a total of 16 H200 GPUs over a minimum of a six-month period. The deployment commenced on November 7, 2024, using WhiteFiber’s existing inventory of H200 GPUs. The service under the purchase order concluded in May 2025. Between May 2025 and September 2025, WhiteFiber signed six additional agreements on a month-to-month basis for a total of 88 H200 GPUs, which were terminated in January 2026. In February 2026, WhiteFiber entered into another service order with the customer to provide services utilizing a total of 10 H200 GPU servers. The service order has an initial term of 12 months beginning on the services commencement date. The deployment and revenue generation began in March 2026. In March 2026, WhiteFiber entered into another service order with the customer to provide services utilizing a total of 256 H100 GPU servers. The service order has an initial term of 24 months beginning on the services commencement date, with an option to renew for an additional twelve months. The deployment and revenue generation began in the second quarter of 2026. In April 2026, WhiteFiber entered into another service order with the customer to provide CPU and storage server services. The service order has an initial term of 24 months beginning on the services commencement date. The deployment and revenue generation began in the second quarter of 2026. In September 2026, WhiteFiber entered into another service order with the customer to provide storage server services. The service order has a term of 19 months beginning on the services commencement date. The deployment and revenue generation began in the third quarter of 2026.
In October 2025, WhiteFiber entered into a two-week service order with a new customer to provide services utilizing a total of 72 B200 GPUs. In January 2026, WhiteFiber entered into an additional two-week service order with this customer for 72 B200 GPUs. These contracts were terminated as of February 2026. In January 2026, WhiteFiber entered into a further service order with this customer to provide services utilizing a total of 384 B200 GPUs. This service order has an initial term of 24 months commencing on the service commencement date, after which it will automatically renew for successive one-month periods unless terminated by either party. Deployment and revenue generation commenced in January 2026.
In February 2026, WhiteFiber entered into a service order with a new customer to provide services utilizing a total of 256 GPUs. The service order has an initial term of 12 months beginning on the services commencement date, after which it automatically renews for successive one-month periods unless terminated by either party. The deployment and revenue generation began on February 1, 2026. In August 2026, WhiteFiber entered into an additional five-year service order with this customer to provide services utilizing a total of 576 Nvidia B300s GPUs in Iceland. Service under this agreement is targeted to commence in the fourth quarter of 2026.
In March 2026, WhiteFiber entered into a service order with a new customer, Prime Intellect, to provide services utilizing a total of 72 GB200 GPUs. The service order has an initial term of 6 months beginning on the services commencement date, after which it automatically renews for successive one-month periods unless terminated by either party. The deployment and revenue generation began in March 2026 and services continued to be provided through August 2026. In April 2026, WhiteFiber entered into an additional service order with this customer to provide services utilizing a total of 216 GB200 GPUs. The service order has an initial term of 12 months beginning on the services commencement date, after which it automatically renews for successive one-month periods unless terminated by either party. The deployment and revenue generation began in July 2026. In August 2026, WhiteFiber entered into a new service order to provide services utilizing a total of 72 GB200 GPUs. The service order has an initial term of 24 months beginning on the services commencement date, after which it automatically renews for successive one-month periods unless terminated by either party. The deployment and revenue generation began in the third quarter of 2026. Also in August 2026, WhiteFiber entered into an additional service order with this customer to provide services utilizing a total of 576 VR200 (Vera Rubin) GPUs in Canada, representing WhiteFiber’s first Vera Rubin deployment. The service order has an initial term of 36 months beginning on the services commencement date, after which it automatically renews for successive one-month periods unless terminated by either party. Services are targeted to commence in the first half of 2027.
In May 2026, WhiteFiber entered into a two-year cloud services agreement with Hyperbolic Labs, Inc. to deploy 512 H200 GPUs from its existing owned fleet. Revenue under this agreement commenced in May 2026.
In May 2026, WhiteFiber entered into a five-year agreement to provide AI compute infrastructure for an investment-grade technology customer in the Paris region utilizing advanced NVIDIA GPU systems. Service under this agreement, which is now expected to commence in the first quarter of 2027, subject to final equipment delivery and acceptance milestones. WhiteFiber has secured third-party data center capacity in France to support the deployment and has entered into a binding term sheet for project-level financing with respect to this deployment (the “France Project Financing”). WhiteFiber is currently in the process of negotiating definitive documentation for the France Project Financing; however, certain material terms remain subject to ongoing negotiation between the parties. The project is supported by customer prepayments, including 12 months of advanced service fees, which WhiteFiber has received, and is expected to be further supported by project-level financing, with limited long-term reliance on its corporate balance sheet and existing cash resources.
In July 2026, WhiteFiber entered into a service order with a new customer to provide services utilizing a total of 128 B300 GPUs. The service order has an initial term of 36 months beginning on the services commencement date, after which it automatically renews for successive one-month periods unless terminated by either party. Services are targeted to commence in the fourth quarter of 2026.
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New Business Developments
In August 2026, WhiteFiber entered into two service orders with a new customer to provide services utilizing a total of 1,392 B300 GPUs and 968 B300 GPUs, respectively. The service orders each have an initial term of 36 months beginning on the services commencement date, after which they automatically renew for successive one-month periods unless terminated by either party. The deployment and revenue generation for each is expected to begin in the fourth quarter of 2026.
In September 2026, WhiteFiber entered into a service order with a new customer to provide services utilizing a total of 1,024 B300 GPUs. The service order has an initial term of 48 months beginning on the services commencement date, after which it automatically renews for successive one-month periods unless terminated by either party. Services are targeted to commence in the fourth quarter of 2026.
In September 2026, WhiteFiber entered into a master service agreement and an initial service order with a technology customer to provide AI compute infrastructure from a third-party data center in Sydney, Australia, utilizing advanced NVIDIA B300 GPU systems (approximately 1,200 GPUs). The initial service order has a 59-month term. Service is expected to commence in the first quarter of 2027, following delivery of the equipment and customer acceptance. The customer has made a prepayment equal to 12 months of service fees. If service does not commence by the contractual long-stop date, the customer may terminate the service order and receive a refund of the prepayment.
In September 2026, WhiteFiber entered into a statement of work with a new customer to provide management services for a total of 2,048 B300 GPUs. The statement of work has an initial term of 42 months beginning on the services commencement date, which is expected to be the first quarter of 2027.
In October 2026, WhiteFiber entered into a five-year agreement to provide AI compute infrastructure for a global technology customer utilizing advanced NVIDIA GPU systems. Service under this agreement is expected to commence in the second quarter of 2027, subject to final equipment delivery and acceptance milestones. The customer is required to fund a prepayment equal to nine months of service fees, into an escrow account to be released against deployment costs, and the customer’s payment obligations are supported by a guarantee from an affiliate of the customer. Under the customer agreement WhiteFiber is subject to customary delivery milestones, including liquidated damages capped at 5% of total contract value for late delivery, and WhiteFiber is required to provide a performance guarantee of $8.75 million.
Key Factors that May Affect Future Results of Operations
The Company’s future results of operations are, in part, dependent on WhiteFiber’s ability to complete and expand capacity at its existing data center projects and to develop its data center pipeline. WhiteFiber substantially completed construction of its MTL-3 facility by the end of October 2025. The site has commenced billing its customer, Cerebras, as of November 1, 2025, in the amount of CAD 1.4 million (approximately $979 thousand USD) monthly for the duration of the five-year contract. Additionally, during the third quarter WhiteFiber began planning for MTL-2 site and expect construction to begin in the fourth quarter of 2026.
On July 9, 2026, WhiteFiber announced initial research and development results for a proprietary cross-data-center networking architecture designed to link geographically separated data centers into a single logical GPU supercluster. Testing demonstrated 111.2 Tbps of bandwidth across 83 kilometers of dark fiber with a guaranteed round-trip latency of 0.9 milliseconds, and WhiteFiber has submitted related patent applications. Commercial launch of this solution occurred in September 2026. However, there can be no assurance that the patents will be issued, that the technology will be commercially accepted, or that WhiteFiber will recover its development and commercialization costs, any of which could adversely affect the Company’s business, financial condition and results of operations.
The Company’s and WhiteFiber’s ability to fund the continued construction and buildout of WhiteFiber’s data center facilities, and to refinance near-term debt maturities, depend on successfully obtaining additional financing on acceptable terms, or at all. If the Company or WhiteFiber is unable to do so, the Company’s business, operating results, and financial condition could be adversely affected.
Digital Asset Business
The digital asset business is comprised primarily of two distinct but highly complementary operations: (i) ETH staking (the “ETH Staking Operations”); and (ii) digital asset mining (the “Digital Asset Mining Operations”).
In June 2025, the Company announced that it had initiated a strategic transition to become a pure play ETH staking and treasury company. In connection with the transition, the Company has been converting its BTC holdings into ETH over time and has been winding down its bitcoin mining operations, with any net proceeds to be re-deployed into ETH.
ETH Staking Business
In the fourth quarter of 2022, we formally commenced Ethereum staking operations. We delegate or stake our ETH holdings to an Ethereum validator node to help secure and strengthen the blockchain network. Stakers are compensated for this commitment in the form of a reward of the native network token.
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We ceased our native staking with MarsLand in the first quarter of 2024 and initiated our native staking with Figment Inc.
We started participating in liquid staking via Liquid Collective protocol on the Coinbase platform in the first quarter of 2023. Liquid staking allows participants to achieve greater capital efficiency by utilizing their staked ETH as collateral and trading their staked ETH tokens on the secondary market. In the first quarter of 2024, we reclaimed all the liquid staked ETH from Liquid Collective protocol. In July 2025, we resumed liquid staking through the Liquid Collective protocol with 5,120 ETH. This approach provided flexibility to engage in both staking and restaking through a broader range of strategies and platforms. Subsequently, we ceased our liquid staking activities with Liquid Collective protocol in October 2025. In April 2026, the Company liquid staked 73,235 ETH and received 66,192 LsETH, a portion of which was subsequently pledged as collateral under certain borrowing arrangements during the period.
Digital Asset Mining Business
We commenced our bitcoin (“BTC”) mining business in February 2020. We initiated limited Ethereum mining operations in January 2022, however discontinued the operations by September 2022 due to Ethereum blockchain switching from proof-of-work (“PoW”) consensus mechanism to proof-of-stake (“PoS”) validation. Our mining operations, hosted by third-party providers, use specialized computers, known as miners, to generate digital assets. Our miners use application specific integrated circuit (“ASIC”) chips. These chips enable the miners to apply high computational power, expressed as “hash rate”, to provide transaction verification services (generally known as “solving a block”) which helps support the blockchain. For every block added, the blockchain provides an award equal to a set number of digital assets per block. Miners with a greater hash rate generally have a higher chance of solving a block and receiving an award.
We operate our mining assets with the primary intent of accumulating digital assets which we may sell for fiat currency from time to time depending on market conditions and management’s determination of our cash flow needs, and/or exchange into ETH or USD Coin (“USDC”). Our mining strategy has been to mine bitcoins as quickly and as many as possible given the fixed supply of bitcoins. In view of historically long delivery lead times to purchase miners from manufacturers like Bitmain Technologies Limited (“Bitmain”) and MicroBT Electronics Technology Co., Ltd (“MicroBT”), and other considerations, we have chosen to acquire miners on the spot market, which can typically result in delivery within a relatively short time.
We have entered into service agreements with third-party hosting partners in North America and Iceland. These partners operate specialized mining data centers, where they install and operate the miners and provide IT consulting, maintenance, and repair work on site for us. Our mining facilities are currently maintained by Digital Energy Partner LLC (“DEP”) in Texas and Mendenhall Ops LLC (“Merkle”) in Tennessee. Our mining facilities in Kentucky, Texas, New York, and Iceland were previously maintained by Soluna Computing, Inc. and DVSL ComputeCo, LLC (collectively, “Soluna”), Bitdeer Technologies Group (“Bitdeer”), Digihost Technologies Inc. (“Digihost”), and GreenBlocks ehf, an Icelandic private limited company (“GreenBlocks”), respectively. The Company’s partnership with Soluna and GreenBlocks concluded at the end of February 2026, while its partnership with Digihost and Bitdeer concluded during May 2026 and June 2026, respectively.
From time to time, the Company may change partnerships with hosting facilities to recalibrate its bitcoin mining operations. These terminations are strategic, targeting reduced operational costs, enhanced energy efficiency for a smaller carbon footprint, increased flexibility in operational control, and minimized geopolitical risks. While a short-term decrease in mining output might occur, we expect these changes to yield long-term operational improvements.
We are a sustainability-focused digital asset mining company. On June 24, 2021, we signed the Crypto Climate Accord, a private sector-led initiative that aims to decarbonize the crypto and blockchain sectors. On December 7, 2021, we became a member of the Bitcoin Mining Council (“BMC”), joining MicroStrategy and other founding members to promote transparency, share best practices, and educate the public on the benefits of bitcoin and bitcoin mining.
Miner Deployments
During the three months ended September 30, 2026, we continued to work with our hosting partners to deploy our miners in North America.
During the first quarter of 2026, the Company reallocated a portion of its mining fleet across hosting facilities as part of its ongoing efforts to recalibrate its mining operations. This transition, driven by changes in hosting partnerships, including the transfer of 2,483 miners from Soluna and DEP’s facilities, respectively, to Bitdeer.
During the second quarter of 2026, the Company transferred 2,451 and 1,778 miners from Soluna and Bitdeer’s facilities, respectively, to Merkle.
During the third quarter of 2026, the Company transferred 1,300 miners from DEP’s facilities to Merkle.
As of September 30, 2026, the Company’s active hash rate totals approximately 0.9 EH/s, with operations in North America.
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Power and Hosting Overview
In June 2021, we entered into a strategic co-mining agreement with Digihost Technologies in North America. Pursuant to the terms of the agreement, Digihost provides certain premises to Bit Digital for the purpose of the operation and storage of a twenty (20) MW bitcoin mining system to be delivered by Bit Digital. Digihost provides services to maintain the premises for a term of two (2) years. Digihost shall also be entitled to 20% of the net profit generated by the miners.
In April 2023, we renewed the co-mining agreement with Digihost, previously executed in June 2021. Pursuant to the terms of the new agreement, Digihost provides certain premises to Bit Digital for the purpose of the operation and storage of an up to 20 MW bitcoin mining system to be delivered by Bit Digital. Digihost also provides services to maintain the premises for a term of two years, automatically renewing for a period of one (1) year. Digihost shall also be entitled to 30% of the net profit generated by the miners. Our partnership with Digihost concluded in May 2026, and the Company is currently evaluating alternative hosting arrangements for the miners previously deployed at the Digihost facility. As of the date of this report, these miners are in storage.
On May 9, 2023 (“Effective Date”), the Company entered into a Term Loan Facility and Security Agreement (the “Loan Agreement”) with GreenBlocks. Pursuant to the Loan Agreement, GreenBlocks has requested the Company to extend one or more loans (“Advances”) under a senior secured term loan facility in an aggregate outstanding principal amount not to exceed $5 million. The interest rate of the Loan Agreement is 0% and Advances are to be repaid on the maturity date, which is the thirty-nine-month anniversary of the Effective Date. GreenBlocks will exclusively use the Advances to buy miners that will be operated for the benefit of the Company at a facility in Iceland, with an overall capacity of 8.25 MW. To secure the prompt payment of Advances, the Company has been granted a continuing first priority lien and security interest in all of GreenBlocks’s rights, title and interest to the financed miners. The miners are the sole property of GreenBlocks, of which they are responsible for the purchase, installation, operation, and maintenance.
On May 9, 2023, the Company entered into a Computation Capacity Services Agreement (the “Services Agreement”) with GreenBlocks. Pursuant to the Agreement, GreenBlocks will provide computational capacity services and other necessary ancillary services, such as operation, management, and maintenance, at the facility in Iceland for a term of two years. GreenBlocks will own and operate the miners financed through the Loan Agreement for the purpose of providing computational capacity of up to 8.25 MW. The Company will pay power costs of $0.05 per kilowatt hour, a pod fee of $22,000 per pod per month, and a depreciation fee equal to 1/36 of the facility size per month. The performance fees under this agreement are 20% of the net profit. The Company submitted to Greenblocks a deposit in the amount of $1,052,100, which was exclusively for the purpose of paying the landlord of the facility for hosting space.
On June 1, 2023, the Company and GreenBlocks entered the Omnibus Amendment to Loan Documents and Other Agreements (“Omnibus Amendment”). This amendment revised both the Loan Agreement and the Services Agreement previously entered on May 9, 2023. While the core terms remained consistent, notable modifications pertained to the facility size and contracted capacity. Specifically, the facility size was increased from $5 million to $6.7 million. Moreover, GreenBlocks agreed to expand the computation capacity to approximately 10.7 MW. Advances of $6.4 million have been financed by the Company to GreenBlocks.
In May 2025, we amended the Services Agreement with Greenblocks, originally executed in May 2023 and previously amended in June 2023. Pursuant to the terms of the amended agreement, Greenblocks shall provide services to support 8.9 MW of power capacity from March 1, 2025 through April 30, 2025 and 5 MW of computational capacity starting May 1, 2025 through December 31, 2025. The Company will pay power costs of $0.067 per kilowatt hour and a pod fee of $10,000 per pod per month, subject to pro rata adjustment if usage falls below 2 MW. All other provisions of the original agreement and previous appendices remain in effect. The amended terms may be modified by mutual agreement, and either party may terminate with one month’s notice. Our partnership with GreenBlocks concluded in February 2026, and the Company is currently evaluating alternative hosting arrangements for the miners previously deployed at the GreenBlocks facility. As of the date of this report, these miners are in storage.
In October 2023, we entered into a strategic co-location agreement with Soluna Computing, Inc. for a term of one year automatically renewing on a month-to-month basis unless terminated by either party. Pursuant to the terms of the agreement, Soluna provided certain required mining colocation services at their hosting facility in Murray, Kentucky to the Company for the purpose of the operation and storage of up to 4.4 MW bitcoin mining system to be delivered by Bit Digital. Soluna was also entitled to 42.5% of the net profit generated by the miners. This agreement expired at the end of October 2024.
In October 2024, we entered into a co-location agreement with Soluna SW, Inc. to continue our business relationship. Under this agreement, Soluna provides certain required mining colocation services to the Company at their hosting facility in Murray, Kentucky for the purpose of the operation and storage of bitcoin mining system to be delivered by the Company up to 6.6 MW (3.3 MW for terms of nine months and 3.3 MW for terms of one (1) year), automatically renewing on a month-to-month basis unless terminated by either party. Soluna shall also be entitled to 35% of the net profit generated by the miners.
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In December 2024, we entered into two additional co-location agreements with Soluna DVSL ComputerCo, LLC. pursuant to which Soluna agreed to provide the Company with up to 11 MW (5.5 MW and 5.5 MW, respectively) at their hosting facility in Silverton, Texas. Both agreements are for one (1) year automatically renewing on a month-to-month basis unless terminated by either party on at least 60 days prior written notice. Soluna shall also be entitled to 35% and 27.5%, respectively, of the net profit generated by the miners. These new agreements bring the Company’s total contracted hosting capacity with Soluna to approximately 17.6 MW. Our partnership with Soluna concluded in February 2026. The Company has relocated approximately 2,451 miners to Merkle and continues to evaluate alternative deployment options for the remaining miners currently in storage. In September 2026, the Company sold 1,162 units of miners to Rounders LLC, reducing its total mining fleet to approximately 20,192 units as of September 30, 2026.
In November 2023, we entered into a hosting services agreement, which was amended on March 7, 2024, with Dory Creek, LLC, a subsidiary of Bitdeer Technologies Group (“Bitdeer”), for a term of one (1) year automatically renewing on an annual basis unless terminated by either party by giving a 30-day prior notice to the other Party in writing. Pursuant to the terms of the agreement, Bitdeer provides maintenance and operation services to Bit Digital to support 17.5 MW of capacity. Bitdeer shall also be entitled to 30% of the net profit generated by the miners. Bit Digital shall have the first right, but not obligation, to accept services for any extra capacity under the terms of this Agreement. Our partnership with Bitdeer concluded in June 2026. The Company has since relocated approximately 1,778 units of miners to Merkle and is evaluating alternative deployment options for the remaining miners, which are currently in storage.
In February 2025, we entered into two hosting services agreements with A.R.T. Digital Holdings Corp (“KaboomRacks”) for terms of nine (9) months and three years automatically renewing on an annual basis unless terminated by either party. Pursuant to the terms of the agreements, KaboomRacks provides maintenance and operation services to Bit Digital to support 6 MW and 13 MW of capacity. In accordance with the agreements, we paid a refundable advance of $1.3 million, which will be applied against monthly hosting charges over an 18-month period.
On July 1, 2025, we entered into the first amendment to the hosting service agreement for 13 MW of capacity. The amendment modified the existing agreement, identifying the two facilities that will provide maintenance and operations service to Bit Digital to support 5 MW and 8 MW of capacity. KaboomRacks shall also be entitled to respective 40%, 14.75% and 22.5% of the net profit generated by the miners. On November 12, 2025, we received communication regarding a change in the contracting entity under its existing hosting arrangements. Effective immediately, Digital Energy Partners LLC (“DEP”) replaced KaboomRacks as the sole contracting counterparty. Under the updated terms, KaboomRacks will return all deposits previously held by it, and we will remit a one-month deposit related to electricity costs to DEP. In connection with the transition, DEP assumed the remaining portion of the $1.3 million loan, with an outstanding balance of approximately $0.4 million as of September 30, 2026. The Company has since relocated approximately 1,300 units of miners to Merkle which are currently in storage. As of September 30, 2026, DEP provided approximately 12.7 MW of capacity for our miners at their facility.
In May 2022, our hosting partner Blockfusion advised us that the substation at its Niagara Falls, New York facility was damaged by an explosion and fire, and power was cut off to approximately 2,515 of the Company’s bitcoin miners and approximately 710 ETH miners that had been operating at the site immediately prior to the incident. The explosion and fire are believed to have been caused by faulty equipment owned by the power utility. Blockfusion and the Company have entered into a common interest agreement to jointly pursue any claims evolving from the explosion and fire. Prior to the incident, our facility with Blockfusion in Niagara Falls, provided approximately 9.4 MW to power our miners. Power was restored to the facility in September 2022. However, we received a notice dated October 4, 2022 (the “Notice”), from the City of Niagara Falls, which ordered the cease and desist from any cryptocurrency mining or related operations at the facility until such time as Blockfusion complies with Section 1303.2.8 of the City of Niagara Falls Zoning Ordinance (the “Ordinance”), in addition to all other City ordinances and codes. Blockfusion has advised us that the Ordinance came into effect on October 1, 2022, following the expiration of a related moratorium on September 30, 2022. Blockfusion has further advised that it has submitted applications for new permits based on the Ordinance’s new standards and that the permits may take several months to process. Pursuant to the Mining Services Agreement between Bit Digital and Blockfusion dated August 25, 2021, Blockfusion represents, warrants and covenants that it “possesses, and will maintain, all licenses, registrations, authorizations and approvals required by any governmental agency, regulatory authority or other party necessary for it to operate its business and engage in the business relating to its provision of the Services.” On October 5, 2022, Bit Digital further advised Blockfusion that it expects it to comply with the directives of the Notice. Our service agreement with Blockfusion ended in September 2023. Legal proceedings involving Blockfusion are currently ongoing. See Note 21. Commitments and contingencies to our condensed consolidated financial statements for further information.
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On June 4, 2026, the Company entered into a hosting services agreement with Mendenhall Ops LLC (“Merkle”) for an initial term of one year, which automatically renews for successive one-year periods unless terminated by either party. Pursuant to the terms of the agreement, Merkle agreed to provide colocation, operation, maintenance, and related services at its facilities for the operation of 4,137 bitcoin miners representing approximately 12.55 MW of power capacity and an aggregate hash rate of approximately 0.62 EH/s. In exchange for these services, Merkle is entitled to receive reimbursement of certain operating costs and performance fees ranging from 25% to 40% of net digital assets generated, depending on the miner model. Upon the execution of this service agreement, we paid a power prepayment of $0.7 million. As of September 30, 2026, Merkle provided approximately 12.8 MW of capacity for our miners at their facility.
Miner Fleet Update and Overview
As of December 31, 2025, we had 21,354 miners owned or operating for bitcoin mining with a total maximum hash rate of 2.8 EH/s.
As of September 30, 2026, we had 20,192 miners owned or operating for bitcoin mining with a total maximum hash rate of 2.7 EH/s.
Bitcoin Production
From the inception of our bitcoin mining business in February 2020 to September 30, 2026, we earned an aggregate of 7,659.6 bitcoins.
During the nine months ended September 30, 2026, the Company received 108.8 bitcoins from mining services and recognized mining revenue of $8.1 million.
ETH Staking Business
In the fourth quarter of 2022, we formally commenced Ethereum staking operations. We delegate or stake our ETH holdings to an Ethereum validator node to help secure and strengthen the blockchain network. Stakers are compensated for this commitment in the form of a reward of the native network token.
For the ETH native staking business, we previously partnered with Blockdaemon, Marsprotocol and MarsLand. Currently, we stake ETH with Figment, using network-based smart contracts, on a node for the purpose of validating transactions and adding blocks to the network. Through these contracts, the Company stakes ETH on nodes for the purpose of validating transactions and adding blocks to the Ethereum blockchain network. The Company is able to withdraw staked ETH under contracted staking. In exchange for staking the ETH and validating transactions on blockchain networks, the Company is entitled to block rewards and transaction fees for successfully validating or adding a block to the blockchain. These rewards are received by the Company directly from the Ethereum network and are calculated approximately based on the proportion of the Company’s stake to the total ETH staked by all validators.
For the liquid staking business, the Company stakes ETH in exchange for receipt tokens, which could be redeemed to ETH or can be traded or collateralized elsewhere, at any time. In the first quarter of 2024, we ceased our liquid staking activities with Liquid Collective protocol and reclaimed all our staked Ethereum. In July 2025, we resumed liquid staking through the Liquid Collective protocol with 5,120 ETH. This approach provides flexibility to engage in both staking and restaking through a broader range of strategies and platforms. Subsequently, we ceased our liquid staking activities with Liquid Collective protocol in October 2025. In April 2026, the Company liquid staked 73,235 ETH and received 66,192 LsETH, a portion of which was subsequently pledged as collateral under certain borrowing arrangements during the period.
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Results of Operations for the Three and Nine Months Ended September 30, 2026 and 2025
The following table summarizes the results of our operations during the three months ended September 30, 2026 and 2025, respectively, and provides information regarding the dollar increase or (decrease) during the period. This information should be read together with our condensed consolidated financial statements and related notes included elsewhere in this Form 10-Q.
| For the Three Months Ended September 30, | Variance in | |||||||||||
| 2026 | 2025 | Amount | ||||||||||
| Revenues | ||||||||||||
| Digital asset mining | $ | 2,022 | $ | 7,416 | $ | (5,394 | ) | |||||
| Cloud services | 18,106 | 18,033 | 73 | |||||||||
| Colocation services | 5,617 | 1,692 | 3,925 | |||||||||
| ETH staking | 1,028 | 2,869 | (1,841 | ) | ||||||||
| Other | 294 | 455 | (161 | ) | ||||||||
| Total revenues | 27,067 | 30,465 | (3,398 | ) | ||||||||
| Operating costs and expenses | ||||||||||||
| Cost of revenue (exclusive of depreciation shown below) | ||||||||||||
| Digital asset mining | (1,474 | ) | (5,033 | ) | 3,559 | |||||||
| Cloud services | (7,907 | ) | (6,315 | ) | (1,592 | ) | ||||||
| Colocation services | (2,438 | ) | (675 | ) | (1,763 | ) | ||||||
| ETH staking | (71 | ) | (113 | ) | 42 | |||||||
| Depreciation and amortization expenses | (11,067 | ) | (9,636 | ) | (1,431 | ) | ||||||
| General and administrative expenses | (25,478 | ) | (33,095 | ) | 7,617 | |||||||
| Gains on digital assets | 84,040 | 168,041 | (84,001 | ) | ||||||||
| Gains on digital intangible assets | 5,381 | - | 5,381 | |||||||||
| Impairment on digital intangible assets | (3,219 | ) | (1,836 | ) | (1,383 | ) | ||||||
| Total operating expenses | 37,767 | 111,338 | (73,571 | ) | ||||||||
| Income from operations | 64,834 | 141,803 | (76,969 | ) | ||||||||
| Net gain (loss) from disposal of property and equipment | 93 | (539 | ) | 632 | ||||||||
| Change in fair value of derivative liability | 10,736 | - | 10,736 | |||||||||
| Interest expense | (10,397 | ) | - | (10,397 | ) | |||||||
| Induced conversion expense | (80,767 | ) | - | (80,767 | ) | |||||||
| Other income, net | 17,445 | 6,159 | 11,286 | |||||||||
| Total other (expense) income, net | (62,890 | ) | 5,620 | (68,510 | ) | |||||||
| Profit before income taxes | 1,944 | 147,423 | (145,479 | ) | ||||||||
| Income tax expenses | (1,344 | ) | (698 | ) | (646 | ) | ||||||
| Net income | $ | 600 | $ | 146,725 | $ | (146,125 | ) | |||||
Revenue
We generate revenues from cloud services, colocation services, digital asset mining, and ETH staking businesses. Refer to Note 3. Revenue for further information.
Revenue from cloud services
In the fourth quarter of 2023, we established our cloud-based HPC graphics processing unit services, which we term cloud services, a new business line to provide services to support generative AI workstreams. The Company commenced offering cloud services to customers in January 2024.
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Our revenue from cloud services increased by $0.1 million, or 0.4%, to $18.1 million for the three months ended September 30, 2026 from $18.0 million for the three months ended September 30, 2025. The increase was due to $3.4 million of termination fee revenue recognized under the termination agreement with our initial customer. This was largely offset by lower recurring revenue following that customer’s termination, which reduced the number of GPUs deployed for them, and was partially offset by revenue from GPUs deployed to new customers in 2026.
Revenue from colocation services
In the fourth quarter of 2024, we acquired Enovum which holds our data center business that provides customers with physical space, power, and cooling within data center facilities.
Our revenue from colocation services was $5.6 million and $1.7 million for the three months ended September 30, 2026 and 2025, respectively. The increase was primarily due to the MTL-3 site becoming fully operational and generating revenues beginning November 2025 and the commencement of revenue at the NC-1 facility, which contributed $1.1 million of lease income.
Revenue from digital asset mining
We provide computing power to digital asset mining pools, and receive consideration in the form of digital assets, the value of which is determined based on the spot price of Bitcoin at contract inception. By providing computing power to successfully add a block to the blockchain, the Company is entitled to a fractional share of the digital assets award from the mining pool operator, which is based on the proportion of computing power the Company contributed to the mining pool to the total computing power contributed by all mining pool participants in solving the current algorithm.
For the three months ended September 30, 2026, we received 28.4 bitcoins from the Foundry mining pool. As of September 30, 2026, our active hash rate was at an aggregate of 0.9 EH/s for our bitcoin miners. For the three months ended September 30, 2026, we recognized revenue of $2.0 million from bitcoin mining services.
For the three months ended September 30, 2025, we received 64.9 bitcoins from the Foundry mining pool. As of September 30, 2025, our active hash rate was at an aggregate of 1.9 EH/s for our bitcoin miners. For the three months ended September 30, 2025, we recognized revenue of $7.4 million from bitcoin mining services.
Our revenues from digital asset mining services decreased by $5.4 million, or 72.7%, to $2.0 million for the three months ended September 30, 2026 from $7.4 million for the three months ended September 30, 2025. The decrease was primarily due to lower BTC generated from our mining business and lower average BTC price in the third quarter of 2026, compared to the same period in 2025.
Revenue from ETH staking
During the fourth quarter of 2022, we commenced ETH staking business, in both native staking and liquid staking.
For the ETH native staking business, we previously partnered with Blockdaemon, Marsprotocol and MarsLand. Currently, we stake ETH with Figment, using network-based smart contracts, on a node for the purpose of validating transactions and adding blocks to the network. Through these contracts, the Company stakes ETH on nodes for the purpose of validating transactions and adding blocks to the Ethereum blockchain network. The Company is able to withdraw staked ETH under contracted staking. In exchange for staking the ETH and validating transactions on blockchain networks, the Company is entitled to block rewards and transaction fees for successfully validating or adding a block to the blockchain. These rewards are received by the Company directly from the Ethereum network and are calculated approximately based on the proportion of the Company’s stake to the total ETH staked by all validators.
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For the liquid staking business, the Company stakes ETH in exchange for receipt tokens, which could be redeemed to ETH or can be traded or collateralized elsewhere, at any time. In the first quarter of 2024, we ceased our liquid staking activities with Liquid Collective protocol and reclaimed all our staked Ethereum. In July 2025, we resumed liquid staking through the Liquid Collective protocol with 5,120 ETH. Subsequently, we ceased our liquid staking activities with Liquid Collective protocol in October 2025. In April 2026, the Company liquid staked 73,235 ETH and received 66,192 LsETH, a portion of which was subsequently pledged as collateral under certain borrowing arrangements during the period.
In the first quarter of 2024, the Company has restaked 3,008 ETH into EigenLayer, a protocol built on Ethereum that enables restaking of the already-staked ETH, through Figment. To mitigate potential risks, we restake our ETH without delegating to any operator and the Company received 33,568 EigenLayer in the fourth quarter of 2024 from this restaking activity. As of the date of this report, the reward earned in 2026 from this restaking activity is not significant.
For the three months ended September 30, 2026, the Company earned 474.0 ETH through native staking and recognized native staking revenue of $1.0 million.
For the three months ended September 30, 2025, we earned 644.3 ETH and 52.9 ETH in native staking and liquid staking, respectively. For the three months ended September 30, 2025, we recognized revenues of $2.6 million and $0.2 million from native staking and liquid staking, respectively.
Our revenues from ETH native staking decreased by $1.6 million, or 61.2% to $1.0 million for the three months ended September 30, 2026 from $2.6 million for the three months ended September 30, 2025. The decrease was primarily due to a decrease of 170.3 ETH earned from staking services and lower average price of ETH for the three months ended September 30, 2026 compared to the three months ended September 30, 2025.
Our revenues from ETH liquid staking decreased by $0.2 million, or 100%, to $nil for the three months ended September 30, 2026 from $0.2 million for the three months ended September 30, 2025. The decrease was primarily attributable to the accounting treatment of liquid-staked ETH, under which increases in the value of LsETH arising from staking activities are not recognized as revenue during the period.
Cost of revenue
We incur cost of revenue from digital asset mining, cloud services, colocation services, and ETH staking businesses.
The Company’s cost of revenue consists primarily of direct production costs associated with its core operations, excluding depreciation and amortization, which are separately stated in the Company’s condensed consolidated statements of operations. Specifically, these costs consist of:
| i. | cloud services operations - electricity costs, datacenter lease expense, GPU servers lease expense, third-party customer support fees and other relevant costs |
| ii. | colocation services - electricity costs, lease costs, data center employees’ wage expenses, and other relevant costs |
| iii. | mining operations - electricity costs, profit-sharing fees and other relevant costs |
| iv. | ETH staking business - service fee and reward-sharing fees to the service providers. |
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Cost of revenue - cloud services
For the three months ended September 30, 2026 and 2025, the cost of revenue from cloud services was comprised of the following:
| For the Three Months Ended September 30, | ||||||||
| 2026 | 2025 | |||||||
| Electricity costs | $ | 823 | $ | 631 | ||||
| Datacenter lease expenses | 1,883 | 1,381 | ||||||
| GPU servers lease expenses | 2,861 | 3,454 | ||||||
| Third-party customer support fees | 1,219 | - | ||||||
| Other costs | 1,121 | 849 | ||||||
| Total | $ | 7,907 | $ | 6,315 | ||||
Electricity costs. These expenses were incurred by the data centers for the HPC equipment and were closely correlated with the number of deployed GPU servers.
For the three months ended September 30, 2026, electricity costs increased by $0.2 million, or 30.4%, compared to the electricity costs incurred for the three months ended September 30, 2025. The increase primarily resulted from an increase in the number of newer-generation GPU servers deployed in the current year, which consume more energy than the models deployed in 2025.
Datacenter lease expenses. We entered into data center lease agreements for fixed monthly recurring costs.
For the three months ended September 30, 2026, data center lease expenses increased $0.5 million, or 36.4%, compared to the three months ended September 30, 2025, primarily due to the new leases that commenced in 2026.
GPU servers lease expenses. We entered into a GPU servers lease agreement to support our cloud services. The lease payment depends on the usage of the GPU servers.
For the three months ended September 30, 2026, GPU server lease expenses decreased by $0.6 million, or 17.2%, compared to the GPU servers lease expenses incurred for the three months ended September 30, 2025. The decrease primarily resulted from a lower GPU server leasing rate on the newly onboarded customers, partially offset by an additional payment due to a leasing partner in connection with a termination agreement with a customer.
Third-party customer support fees. We engaged a third party to provide customer support services.
For the three months ended September 30, 2026, third-party customer support fees were $1.2 million.
Cost of revenue - Colocation Services
In the fourth quarter of 2024, we acquired Enovum which provides colocation services. For the three months ended September 30, 2026 and 2025, the cost of revenue from colocation services was comprised of the following:
| For the Three Months Ended September 30, | ||||||||
| 2026 | 2025 | |||||||
| Electricity costs | $ | 709 | $ | 289 | ||||
| Lease expenses | 357 | 166 | ||||||
| Wage expenses | 359 | 92 | ||||||
| Other costs | 1,013 | 128 | ||||||
| Total | $ | 2,438 | $ | 675 | ||||
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Electricity costs. These expenses were closely correlated with the number of deployed servers hosted by the data center.
For the three months ended September 30, 2026, electricity costs increased by $0.4 million, or 145.3%, compared to the electricity costs incurred for the three months ended September 30, 2025, Since March 31, 2025, the Company has expanded its data center footprint, including the MTL-3 facility. The increase in electricity costs is primarily attributable to the MTL-3 facility, which was operational during the period ended September 30, 2026, but not operational during the period ended September 30, 2025. Additionally, the increase in the electricity cost was driven in part by the commencement of limited operations at our NC-1 facility on September 23, 2026.
Lease expenses. These expenses were incurred by the data center for lease agreement for a fixed monthly recurring cost.
For the three months ended September 30, 2026, datacenter lease expenses increased by $0.2 million, or 115.1%, compared to the datacenter lease expenses incurred for the three months ended September 30, 2025. This is primarily attributed to expense for MTL-3 data center, which was recorded as general and administrative expense in the third quarter of 2025 as the data center was not yet operational.
Wage expenses. These expenses represent the salaries and benefits of data center employees involved in the operation of our facilities.
For the three months ended September 30, 2026, wage expenses increased by $0.3 million, or 290.2%, compared to the wage expenses incurred for three months ended September 30, 2025. The increase was primarily attributable to additional employees hired following the IPO and the operations of the MTL-3 site as well as the commencement of limited operations at our NC-1 facility.
Cost of revenue - digital asset mining
For the three months ended September 30, 2026 and 2025, the cost of revenue from digital asset mining was comprised of the following:
| For the Three Months Ended September 30, | ||||||||
| 2026 | 2025 | |||||||
| Electricity costs | $ | 1,126 | $ | 3,626 | ||||
| Profit-sharing fees | 128 | 993 | ||||||
| Other costs | 220 | 414 | ||||||
| Total | $ | 1,474 | $ | 5,033 | ||||
Electricity costs. These expenses were incurred by mining facilities for the miners in operation and were closely correlated with the number of deployed miners.
For the three months ended September 30, 2026, electricity costs decreased by $2.5 million, or 68.9%, compared to the electricity costs incurred for the three months ended September 30, 2025. The decrease primarily resulted from a decrease in the number of deployed miners.
Profit-sharing fees. We enter into hosting agreements with certain mining facilities, which included performance fees calculated as a fixed percentage of net profit generated by the miners. We refer to these fees as profit-sharing fees.
For the three months ended September 30, 2026, profit-sharing fees decreased by $0.9 million, or 87.1%, compared to profit-sharing fees incurred in the three months ended September 30, 2025. The decrease in profit-sharing fees was primarily due to lower bitcoin production and lower average BTC price in the third quarter of 2026, compared to the same period in 2025.
Cost of revenue - ETH staking
For the three months ended September 30, 2026, cost of revenue from ETH staking business decreased by $42 thousand, or 37.2%, compared to the cost of revenue incurred for the three months ended September 30, 2025. The decrease was primarily driven by a decreased number of staked ETH from 99,936 ETH in the three months ended September 30, 2025 to 74,235 ETH in the three months ended September 30, 2026.
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Depreciation and amortization expenses
For the three months ended September 30, 2026 and 2025, depreciation and amortization expenses were $11.1 million and $9.6 million, respectively, based on an estimated useful life of property, plant, and equipment and intangible assets. The increase in depreciation and amortization expenses is attributable to additional assets placed in service since September 30, 2025, specifically cloud equipment, resulting in higher expense being recognized.
General and administrative expenses
For the three months ended September 30, 2026, our general and administrative expenses, totaling $25.5 million, were primarily comprised of professional and consulting expenses of $6.2 million (including $1.1 million of share-based compensation), share-based compensation expenses for employees of $5.0 million, salary and bonus expenses of $3.8 million, marketing expenses of $2.8 million, travel expenses of $0.3 million, directors and officers insurance expenses of $0.4 million, other expenses of $6.6 million and transportation costs of $0.3 million.
For the three months ended September 30, 2025, our general and administrative expenses, totaling $33.1 million, were primarily comprised of professional and consulting expenses of $11.1 million, shared-based compensation expenses of $10.9 million, salary and bonus expenses of $4.9 million, marketing expenses of$1.6 million, travel expenses of $0.2 million, and directors and officers insurance expenses of $0.3 million.
General and administrative expenses for the three months ended September 30, 2026 were lower than those for the three months ended September 30, 2025 by $7.6 million, or 23%. The decrease was primarily attributable to (i) lower share-based compensation expenses of $5.9 million and (ii) $4.9 million reduction in professional and consulting fees, primarily reflecting lower legal and advisory expenses associated with corporate transactions, as costs related to WhiteFiber’s initial public offering and certain litigation matters incurred during the three months ended September 30, 2025 were non-recurring in nature. These decreases were partially offset by a $2.7 million increase in other expenses which relates primarily to a $2.8 million increase in start-up costs that do not meet the criteria for capitalization.
Gains on digital assets
For the three months ended September 30, 2026, a gain on digital assets of $84.0 million was recognized, primarily attributable to the increase in the prices of bitcoin and ETH as of September 30, 2026.
For the three months ended September 30, 2025, a gain of $168.0 million was recognized, primarily attributable to the increase in the prices of bitcoin and ETH as of September 30, 2025.
Gains on digital intangible assets
For the three months ended September 30, 2026 and 2025, gains on digital intangible assets was $5.4 million and $nil, respectively, primarily due to the transfer of LsETH to lending counterparties under collateral arrangements, which resulted in the derecognition of the LsETH and recognition of digital asset collateral receivables. For further details, refer to Note 6. Digital Asset Collateral Receivable.
Impairment on digital intangible assets
For the three months ended September 30, 2026 and 2025, impairment on digital intangible assets was $3.2 million and $1.8 million, respectively, on its LsETH holdings, primarily due to the carrying amount of LsETH exceeding its fair value.
Change in fair value of derivative liability
Change in fair value of derivative liability during the three months ended September 30, 2026 and 2025 were $10.7 million and $nil, respectively, related to the conversion feature of the 2030 Convertible Notes which was originally accounted for separately as a derivative liability.
Interest expense
For the three months ended September 30,2026 and 2025, interest expense was $10.4 million and $nil, respectively. The increase in interest expense was primarily attributable to borrowings under the Company’s 2030 Convertible Notes, 2031 Convertible Notes, 2032 Convertible Notes, collateralized borrowing from Galaxy, B. Riley Facility, Iceland Facility and Syndicated RBC Credit Facility Agreement.
Induced conversion expense
For the three months ended September 30, 2026, we recorded induced conversion expense of $80.8 million, compared to $nil for the three months ended September 30, 2025. In August 2026, we settled $198.15 million aggregate principal amount of the 2031 Notes in privately negotiated transactions in exchange for $118.0 million of cash, excluding accrued interest, and 6,271,534 ordinary shares with a fair value of $169.8 million. The expense represents the excess of the fair value of the consideration transferred over the fair value of the consideration issuable under the original conversion terms. Refer to Note 12. Debt, for more information.
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Other income, net
For the three months ended September 30, 2026, other income totaling $17.4 million, was primarily comprised of unrealized gains on digital assets held in the fund of $17.1 million, other miscellaneous income of $0.5 million, interest income of $0.4 million and partially offset by unrealized losses on foreign currency exchange of $0.2 million and non-income foreign tax expense of $0.4 million.
For the three months ended September 30, 2025, our other income, totaling $6.2 million, was primarily comprised of unrealized gains on digital assets held in the fund of $7.1 million, interest income of $0.1million, other miscellaneous income of $0.1 million and partially offset by unrealized losses on foreign currency exchange of $0.9 million and non-income municipal expense of $0.3 million.
Other income for the three months ended September 30, 2026 increased by $11.2 million or 183.2% compared to the corresponding period in 2025. The increase was primarily attributable to higher unrealized gains on digital assets held in the fund of $10.0 million, an increase in interest income of $0.3 million, a decrease in non-income municipal expenses of $0.3 million, and a decrease in unrealized foreign exchange losses of $0.7 million.
Income tax provisions
Provision for income taxes consists of federal, state and foreign income taxes. Our income tax provision for the nine months ended September 30, 2026 is primarily attributable to the mix of earnings and losses in countries with differing statutory tax rates, and the valuation allowance applied to the Company’s deferred tax assets in Canada, Japan, France, Singapore and Hong Kong. We continue to maintain a valuation allowance against the deferred tax assets in Canada, Japan, France, Singapore and Hong Kong as the Company does not expect those deferred tax assets are “more likely than not” to be realized in the near future, particularly due to the uncertainty on macroeconomy, politics and profitability of the business.
Our income tax provision was $1.3 million and $0.7 million for the three months ended September 30, 2026 and 2025 respectively. The higher income tax provision during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 was primarily due to geographic mix earning impacts, fair value measurement of digital assets and Net CFC Tested Income or NCTI (a.k.a GILTI) impact. Also, in both periods presented, we were not able to benefit from current year foreign loss before taxes due to foreign valuation allowance from certain foreign operations.
Net income and earnings per share
For the three months ended September 30, 2026, our net income was $0.6 million, representing a change of $146.1 million from a net income of $146.7 million for the three months ended September 30, 2025.
Basic and diluted earnings per share was $0.08 and $0.08 for the three months ended September 30, 2026, respectively. Basic and diluted earnings per share was $0.48 and $0.47 for the three months ended September 30, 2025, respectively.
Basic and diluted weighted average number of shares was 360,441,011 and 362,466,070 for the three months ended September 30, 2026, respectively. Basic and diluted weighted average number of shares was 317,296,789 and 318,896,222 for the three months ended September 30, 2025, respectively.
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The following table summarizes the results of our operations during the nine months ended September 30, 2026 and 2025, respectively, and provides information regarding the dollar increase or (decrease) during the period.
| For the Nine
Months Ended September 30, | Variance in | |||||||||||
| 2026 | 2025 | Amount | ||||||||||
| Revenues | ||||||||||||
| Digital asset mining | $ | 8,098 | $ | 21,825 | $ | (13,727 | ) | |||||
| Cloud services | 58,679 | 49,470 | 9,209 | |||||||||
| Colocation services | 15,117 | 5,060 | 10,057 | |||||||||
| ETH staking | 4,228 | 3,795 | 433 | |||||||||
| Other | 984 | 1,073 | (89 | ) | ||||||||
| Total revenues | 87,106 | 81,223 | 5,883 | |||||||||
| Operating costs and expenses | ||||||||||||
| Cost of revenue (exclusive of depreciation shown below) | ||||||||||||
| Digital asset mining | (6,486 | ) | (17,232 | ) | 10,746 | |||||||
| Cloud services | (24,649 | ) | (18,794 | ) | (5,855 | ) | ||||||
| Colocation services | (6,137 | ) | (1,875 | ) | (4,262 | ) | ||||||
| ETH staking | (234 | ) | (175 | ) | (59 | ) | ||||||
| Depreciation and amortization expenses | (31,191 | ) | (25,102 | ) | (6,089 | ) | ||||||
| Impairment of capitalized software assets | (5,006 | ) | - | (5,006 | ) | |||||||
| General and administrative expenses | (75,673 | ) | (61,032 | ) | (14,641 | ) | ||||||
| (Losses) gains on digital assets | (65,871 | ) | 145,990 | (211,861 | ) | |||||||
| Gains on digital intangible assets | 16,705 | - | 16,705 | |||||||||
| Impairment on digital intangible assets | (49,254 | ) | (1,836 | ) | (47,418 | ) | ||||||
| Total operating (expenses) income | (247,796 | ) | 19,944 | (267,740 | ) | |||||||
| (Loss) income from operations | (160,690 | ) | 101,167 | (261,857 | ) | |||||||
| Net gain (loss) from disposal of property and equipment | 1,915 | (873 | ) | 2,788 | ||||||||
| Change in fair value of derivative liability | 6,021 | - | 6,021 | |||||||||
| Interest expense | (23,544 | ) | - | (23,544 | ) | |||||||
| Induced conversion expense | (80,767 | ) | - | (80,767 | ) | |||||||
| Other (expense) income, net | (3,972 | ) | 6,554 | (10,526 | ) | |||||||
| Total other (expense) income, net | (100,347 | ) | 5,681 | (106,028 | ) | |||||||
| (Loss) income before income taxes | (261,037 | ) | 106,848 | (367,885 | ) | |||||||
| Income tax expenses | (306 | ) | (2,961 | ) | 2,655 | |||||||
| Net (loss) income | $ | (261,343 | ) | $ | 103,887 | $ | (365,230 | ) | ||||
Revenue
We generate revenues from cloud services, colocation services, digital asset mining, and ETH staking businesses. Refer to Note 3. Revenue for further information.
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Revenue from cloud services
In the fourth quarter of 2023, we established our cloud-based HPC graphics processing unit services, which we term cloud services, a new business line to provide services to support generative AI workstreams. The Company commenced offering cloud services to customers in January 2024.
Our revenue from cloud services increased by $9.2 million, or 18.6%, to $58.7 million for the nine months ended September 30, 2026 from $49.5 million for the nine months ended September 30, 2025. The increase was primarily due to an increase in deployed GPU servers to existing customers in 2026. The decrease in our monthly GPU service revenue from the termination of our agreement with our Initial Customer was substantially offset by $15.7 million of termination fee revenue recorded, and therefore was not a significant driver of the change in revenue.
Revenue from colocation services
In the fourth quarter of 2024, we acquired Enovum which provides customers with physical space, power, and cooling within data center facilities.
Our revenue from colocation services was $15.1 million and $5.1 million for the nine months ended September 30, 2026 and 2025, respectively. The increase was primarily due to the MTL-3 site becoming fully operational and generating revenues beginning November 2025 and the revenue generated from the NC-1 facility, which contributed $1.1 million of lease income.
Revenue from digital asset mining
We provide computing power to digital asset mining pools, and receive consideration in the form of digital assets, the value of which is determined based on the spot price of Bitcoin at contract inception. By providing computing power to successfully add a block to the blockchain, the Company is entitled to a fractional share of the digital assets award from the mining pool operator, which is based on the proportion of computing power the Company contributed to the mining pool to the total computing power contributed by all mining pool participants in solving the current algorithm.
For the nine months ended September 30, 2026, we received 108.8 bitcoins from the Foundry mining pool. As of September 30, 2026, our active hash rate was at an aggregate of 0.9 EH/s for our bitcoin miners. For the nine months ended September 30, 2026, we recognized revenue of $8.1 million from bitcoin mining services.
For the nine months ended September 30, 2025, we received 216.4 bitcoins from the Foundry mining pool. As of September 30, 2025, our active hash rate was at an aggregate of 1.9 EH/s for our bitcoin miners. For the nine months ended September 30, 2025, we recognized revenue of $21.8 million from bitcoin mining services.
Our revenues from digital asset mining services decreased by $13.7 million, or 62.9%, to $8.1 million for the nine months ended September 30, 2026 from $21.8 million for the nine months ended September 30, 2025. The decrease was primarily due to lower BTC generated from our mining business and lower average BTC price in the third quarter of 2026, compared to the same period in 2025.
Revenue from ETH staking
During the fourth quarter of 2022, we commenced ETH staking business, in both native staking and liquid staking.
For the ETH native staking business, we previously partnered with Blockdaemon, Marsprotocol and MarsLand. Currently, we stake ETH with Figment, using network-based smart contracts, on a node for the purpose of validating transactions and adding blocks to the network. Through these contracts, the Company stakes ETH on nodes for the purpose of validating transactions and adding blocks to the Ethereum blockchain network. The Company is able to withdraw staked ETH under contracted staking. In exchange for staking the ETH and validating transactions on blockchain networks, the Company is entitled to block rewards and transaction fees for successfully validating or adding a block to the blockchain. These rewards are received by the Company directly from the Ethereum network and are calculated approximately based on the proportion of the Company’s stake to the total ETH staked by all validators.
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For the liquid staking business, the Company stakes ETH in exchange for receipt tokens, which could be redeemed to ETH or can be traded or collateralized elsewhere, at any time. In the first quarter of 2024, we ceased our liquid staking activities with Liquid Collective protocol and reclaimed all our staked Ethereum. In July 2025, we resumed liquid staking through the Liquid Collective protocol with 5,120 ETH. Subsequently, we ceased our liquid staking activities with Liquid Collective protocol in October 2025. In April 2026, the Company liquid staked 73,235 ETH and received 66,192 LsETH, a portion of which was subsequently pledged as collateral under certain borrowing arrangements during the period.
In the first quarter of 2024, the Company has restaked 3,008 ETH into EigenLayer, a protocol built on Ethereum that enables restaking of the already-staked ETH, through Figment. To mitigate potential risks, we restake our ETH without delegating to any operator and the Company received 33,568 EigenLayer in the fourth quarter of 2024 from this restaking activity. As of the date of this report, the reward earned in 2026 from this restaking activity is not significant.
For the nine months ended September 30, 2026, we earned 1,863.2 ETH in native staking and recognized native staking revenues of $4.2 million.
For the nine months ended September 30, 2025, we earned 1,022.1 ETH in native staking and 52.9 ETH in liquid staking, respectively. For the nine months ended September 30, 2025, we recognized revenues of $3.6 million and $0.2 million from native staking and liquid staking, respectively.
Our revenues from ETH native staking increased by $0.6 million, or 18.2%, to $4.2 million for the nine months ended September 30, 2026 from $3.6 million for the nine months ended September 30, 2025. The increase was primarily due to an increase of 841.1 ETH earned from staking services, partially offset by a decrease in the average price of ETH for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025.
Our revenues from ETH liquid staking decreased by $0.2 million, or 100%, to $nil for the nine months ended September 30, 2026 from $0.2 million for the nine months ended September 30, 2025. The decrease was primarily attributable to the accounting treatment of liquid-staked ETH, under which increases in the value of LsETH arising from staking activities are not recognized as revenue during the period.
Cost of revenue
We incur cost of revenue from digital asset mining, cloud services, colocation services, and ETH staking businesses.
The Company’s cost of revenue consists primarily of direct production costs associated with its core operations, excluding depreciation and amortization, which are separately stated in the Company’s condensed consolidated statements of operations. Specifically, these costs consist of:
| i. | cloud services operations - electricity costs, datacenter lease expense, GPU servers lease expense, third-party customer support fees and other relevant costs |
| ii. | colocation services - electricity costs, lease costs, data center employees’ wage expenses, and other relevant costs |
| iii. | mining operations - electricity costs, profit-sharing fees and other relevant costs |
| iv. | ETH staking business - service fee and reward-sharing fees to the service providers. |
Cost of revenue - cloud services
For the nine months ended September 30, 2026 and 2025, the cost of revenue from cloud services was comprised of the following:
| For the Nine
Months Ended September 30, | ||||||||
| 2026 | 2025 | |||||||
| Electricity costs | $ | 2,467 | $ | 1,803 | ||||
| Datacenter lease expenses | 4,857 | 4,020 | ||||||
| GPU servers lease expenses | 12,177 | 10,951 | ||||||
| Third-party customer support fees | 2,617 | - | ||||||
| Other costs | 2,531 | 2,020 | ||||||
| Total | $ | 24,649 | $ | 18,794 | ||||
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Electricity costs. These expenses were incurred by the data centers for the HPC equipment and were closely correlated with the number of deployed GPU servers.
For the nine months ended September 30, 2026, electricity costs increased by $0.7 million, or 36.8%, compared to the electricity costs incurred for the nine months ended September 30, 2025. The increase primarily resulted from an increase in the number of deployed GPU servers.
Datacenter lease expenses. We entered into data center lease agreements for fixed monthly recurring costs.
For the nine months ended September 30, 2026, data center lease expenses increased by $0.8 million, or 20.8%, compared to the nine months ended September 30, 2025, primarily due to new leases that commenced in 2026.
GPU servers lease expenses. We entered into a GPU servers lease agreement to support our cloud services. The lease payment depends on the usage of the GPU servers.
For the nine months ended September 30, 2026, GPU servers lease expenses increased by $1.2 million, or 11.2%, compared to the GPU server lease expense incurred for the nine months ended September 30, 2025. The increase primarily resulted from a one time amount due upon finalizing a termination agreement with a customer, partially offset by a lower GPU server leasing rate on the newly onboarded customers.
Third-party customer support fees. We engaged a third party to provide customer support services.
For the nine months ended September 30, 2026, third-party customer support fees were $2.6 million.
Cost of revenue - Colocation Services
In the fourth quarter of 2024, we acquired Enovum which provides colocation services. For the nine months ended September 30, 2026 and 2025, the cost of revenue from colocation services was comprised of the following:
| For the Nine
Months Ended September 30, | ||||||||
| 2026 | 2025 | |||||||
| Electricity costs | $ | 2,298 | $ | 782 | ||||
| Lease expenses | 894 | 473 | ||||||
| Wage expenses | 817 | 262 | ||||||
| Other costs | 2,128 | 358 | ||||||
| Total | $ | 6,137 | $ | 1,875 | ||||
Electricity costs. These expenses were closely correlated with the number of deployed servers hosted by the data center.
For the nine months ended September 30, 2026, electricity costs increased by $1.5 million, or 193.9%, compared to the electricity costs incurred for the nine months ended September 30, 2025. Since March 31, 2025, the Company has expanded its data center footprint, including the MTL-3 facility. The increase in electricity costs is primarily attributable to the MTL-3 facility, which was operational during the period ended September 30, 2026 but not operational during the period ended September 30, 2025. Additionally, the increase in the electricity cost was driven in part by the commencement of limited operations at our NC-1 facility on September 23, 2026.
Lease expenses. These expenses were incurred by the data center for lease agreement for a fixed monthly recurring cost.
For the nine months ended September 30, 2026, data center lease expenses increased by $0.4 million, or 89.0%, compared to the data center lease expenses incurred for the nine months ended September 30, 2025. This is primarily attributed to expense for the MTL-3 data center, which was recorded as general and administrative expense until the fourth quarter of 2025 as the data center was not yet operational.
Wage expenses. These expenses represent the salaries and benefits of data center employees involved in the operation of our facilities.
For the nine months ended September 30, 2026, wage expenses increased by $0.6 million, or 211.8%, compared to the nine months ended September 30, 2025. The increase was primarily attributable to the operations of MTL-3 site and the limited commencement of operations at our NC-1 facility.
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Cost of revenue - digital asset mining
For the nine months ended September 30, 2026 and 2025, the cost of revenue from digital asset mining was comprised of the following:
| For the Nine
Months Ended September 30, | ||||||||
| 2026 | 2025 | |||||||
| Electricity costs | $ | 4,471 | $ | 12,193 | ||||
| Profit-sharing fees | 1,167 | 3,235 | ||||||
| Other costs | 848 | 1,804 | ||||||
| Total | $ | 6,486 | $ | 17,232 | ||||
Electricity costs. These expenses were incurred by mining facilities for the miners in operation and were closely correlated with the number of deployed miners.
For the nine months ended September 30, 2026, electricity costs decreased by $7.7 million, or 63.3%, compared to the electricity costs incurred for the nine months ended September 30, 2025. The decrease primarily resulted from a decrease in the number of deployed miners.
Profit-sharing fees. We enter into hosting agreements with certain mining facilities, which included performance fees calculated as a fixed percentage of net profit generated by the miners. We refer to these fees as profit-sharing fees.
For the nine months ended September 30, 2026, profit-sharing fees decreased by $2.1 million, or 63.9%, compared to profit-sharing fees incurred in the nine months ended September 30, 2025. The decrease in profit-sharing fees was primarily due to a lower bitcoin production and lower average BTC price in the third quarter of 2026, compared to the same period in 2025.
Cost of revenue - ETH staking business
For the nine months ended September 30, 2026, cost of revenue from ETH staking business increased by $59 thousand, or 33.7%, compared to the cost of revenue incurred for the nine months ended September 30, 2025. The slight increase was primarily attributable to an increase in staked ETH from 99,936 as of September 30, 2025, to 138,269 as of February 28, 2026, and the staking of an additional 13,492 ETH during the second quarter of 2026. The increase was partially offset by lower costs resulting from the unstaking of 41,952 ETH in March 2026 and 29,888 ETH in July 2026, primarily to facilitate collateralized borrowing arrangements with Galaxy.
Depreciation and amortization expenses
For the nine months ended September 30, 2026 and 2025, depreciation and amortization expenses were $31.2 million and $25.1 million, respectively, based on an estimated useful life of property, plant, and equipment and intangible assets. The increase in depreciation and amortization expenses is attributable to additional assets placed in service, resulting in higher expense being recognized.
Impairment of capitalized software assets
For the nine months ended September 30, 2026 and 2025, impairment of capitalized software assets were $5.0 million and $nil, respectively. In the second quarter of 2026, the Company determined that it would discontinue further investment in, and use of, its internally-developed software platform. As a result of this decision, effective June 4, 2026, the Company recorded an impairment charge of the remaining book value of $5.0 million during the nine months ended September 30, 2026.
General and administrative expenses
For the nine months ended September 30, 2026, our general and administrative expenses, totaling $75.7 million, were primarily comprised of professional and consulting expenses of $17.8 million (including share-based compensation expenses of $3.7 million), shared-based compensation expenses for employees of $21.9 million, salary and bonus expenses of $12.1 million, marketing expenses of $5.5 million, travel expenses of $1.0 million, directors and officers insurance expenses of $1.2 million, other expenses of $14.9 million and transportation expenses of $0.9 million.
For the nine months ended September 30, 2025, our general and administrative expenses, totaling $61.0 million, were primarily comprised of professional and consulting expenses of $23.3 million, shared-based compensation expenses of $18.0 million, salary and bonus expenses of $8.1 million, marketing expenses of$2.6 million, travel expenses of $0.7 million, and directors and officers insurance expenses of $0.8 million.
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General and administrative expenses for the nine months ended September 30, 2026 were higher for the nine months ended September 30, 2025, by $14.6 million, or 24.0%. The increase was primarily attributable to (i) higher other expenses of $7.6 million, which included a $3.8 million increase in start-up costs that do not meet the criteria for capitalization and a $2.6 million increase in bad debt expense, (ii) higher share-based compensation expenses of $3.9 million, (iii) higher salaries and bonus expense of $4.0 million due to additional employees hired following the IPO, and (iv) higher marketing expenses of $2.8 million. These increases reflect the Company’s expanded operations and personnel base following the IPO and continued investment in infrastructure and technology development. These increases were partially offset by (i) lower professional and consulting fees of $5.5 million, primarily reflecting lower legal and advisory expenses associated with corporate transactions, as costs related to WhiteFiber’s initial public offering and certain litigation matters incurred during the nine months ended September 30, 2025 were non-recurring in nature.
(Losses) gains on digital assets
For the nine months ended September 30, 2026, a loss of $65.9 million was recognized, primarily attributable to declines in the prices of bitcoin and ETH during the first two quarters of 2026, which were partially offset by price recoveries during the third quarter of 2026.
For the nine months ended September 30, 2025, a gain of $146.0 million was recognized, primarily attributable to the increase in the prices of bitcoin and ETH as of September 30, 2025.
Gains on digital intangible assets
For the nine months ended September 30, 2026 and 2025, gains on digital intangible assets was $16.7 million and $nil, respectively, primarily due to the transfer of LsETH to lending counterparties under collateral arrangements, which resulted in the derecognition of the LsETH and recognition of digital asset collateral receivables. For further details, refer to Note 6. Digital Asset Collateral Receivable.
Impairment on digital intangible assets
For the nine months ended September 30, 2026 and 2025, impairment on digital intangible assets was $49.3 million and $1.8 million, respectively, on its LsETH holdings, primarily due to the carrying amount of LsETH exceeded its fair value.
Net gain (loss) from disposal of property, plant and equipment
For the nine months ended September 30, 2026, the Company sold 1,162 bitcoin miners for a total consideration of $93 thousand. On the date of the transaction, the total original cost and accumulated depreciation of these miners was $1.6 million. The Company recognized a gain of $93 thousand from the sale of miners which was recorded in the amount of “Net gain (loss) from disposal of property and equipment”. The Company received the cash consideration in October 2026.
For the nine months ended September 30, 2026, WhiteFiber sold 126 H200s GPU for a total consideration of approximately $26.1 million. On the date of the transaction, the carrying amount of these GPUs was $24.3 million. The Company recognized a gain of $1.8 million from the sale which was recorded within Net gain (loss) from disposal of property, plant and equipment. As of the date of this Form 10-Q, WhiteFiber has collected the full cash consideration of $26.1 million.
For the nine months ended September 30, 2025, the Company sold 7,900 bitcoin miners for a total consideration of $1,3 million. On the dates of the transaction, the total original cost and accumulated depreciation of these miners were $9.4 million and $7.6 million, respectively. The Company recognized a loss of $0.5 million from the sale of miners which was recorded in the account of “loss from disposal of property, plant and equipment”.
For the nine months ended September 30, 2025, WhiteFiber sold 64 InfiniBand (IB) Switches for a total consideration of $ 1.0 million. On the date of the transaction, the carrying amount of these switches was $1.4 million. The Company recognized a loss of $0.3 million from the sale which was recorded within Net loss from disposal of property, plant and equipment.
Change in fair value of derivative liability
Change in fair value of derivative liability during the nine months ended September 30, 2026 and 2025 were $6.0 million and $nil, respectively, related to the conversion feature of the 2030 Convertible Notes which was originally accounted for separately as a derivative liability.
Interest expense
For the nine months ended September 30, 2026 and 2025, interest expense was $23.5 million and $nil, respectively. The increase in interest expense was primarily attributable to borrowings under the Company’s 2030 Convertible Notes, 2031 Convertible Notes, 2032 Convertible Notes, collateralized borrowing from Galaxy, B. Riley Facility, Iceland Facility and Syndicated RBC Credit Facility Agreement.
Induced conversion expense
For the nine months ended September 30, 2026, we recorded induced conversion expense of $80.8 million, compared to $nil for the nine months ended September 30, 2025. In August 2026, we settled $198.15 million aggregate principal amount of the 2031 Notes in privately negotiated transactions in exchange for $118.0 million of cash, excluding accrued interest, and 6,271,534 ordinary shares with a fair value of $169.8 million. The expense represents the excess of the fair value of the consideration transferred over the fair value of the consideration issuable under the original conversion terms. Refer to Note 12. Debt, for more information.
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Other (expense) income, net
For the nine months ended September 30, 2026, our other expense, totaling $4.0 million, was primarily comprised of unrealized losses on digital assets held in the fund of $4.0 million, non-income foreign tax expense of $1.2 million, unrealized losses on foreign currency exchange of $1.0 million and partially offset by the interest income of $1.4 million and other miscellaneous income of $1.0 million.
For the nine months ended September 30, 2025, our other income, totaling $6.6 million, was primarily comprised of unrealized gains on digital assets held in the fund of $6.5 million, interest income of $0.6 million, other miscellaneous income of $0.4 million, and partially offset by non-income state tax expense of $0.3 million and non-income municipal expense of $0.7 million.
For the nine months ended September 30, 2026, we recognized other expense of $4.0 million, compared to other income of $6.6 million for the nine months ended September 30, 2025. The change of $10.6 million was primarily attributable to unfavorable fair value changes in digital assets held in the fund of $10.4 million, higher non-income foreign tax expenses of $1.2 million and unrealized foreign exchange losses of $1.0 million, partially offset by increases in interest income of $0.8 million, non-income municipal expenses of $0.7 million and other miscellaneous income of $0.6 million.
Income tax provisions
Provision for income taxes consists of federal, state and foreign income taxes. Our income tax provision for the nine months ended September 30, 2026 is primarily attributable to the mix of earnings and losses in countries with differing statutory tax rates, and the valuation allowance applied to the Company’s deferred tax assets in Canada, Japan, France, Singapore and Hong Kong. We continue to maintain a valuation allowance against the deferred tax assets in Canada, Japan, France, Singapore and Hong Kong as the Company does not expect those deferred tax assets are “more likely than not” to be realized in the near future, particularly due to the uncertainty on macroeconomy, politics and profitability of the business.
Our income tax provision was $0.3 million and $3.0 million for the nine months ended September 30, 2026 and 2025 respectively. The income tax provision was lower during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 was primarily due to higher pretax loss, geographic mix earning impacts, and Net CFC Tested Income or NCTI (a.k.a GILTI) impact. Also, in both periods presented, we were not able to benefit from current year foreign loss before taxes due to foreign valuation allowance from certain foreign operations.
Net (loss) income and (loss) earnings per share
For the nine months ended September 30, 2026, our net loss was $261.3 million, representing a change of $365.2 million from a net income of $103.9 million for the nine months ended September 30, 2025.
Basic and diluted loss per share was $0.65 and $0.65 for the nine months ended September 30, 2026, respectively. Basic and diluted earnings per share was $0.46 and $0.46 for the nine months ended September 30, 2025, respectively.
Basic and diluted weighted average number of shares was 345,582,362 and 345,582,362 for the nine months ended September 30, 2026, respectively. Basic and diluted weighted average number of shares was 235,907,855 and 236,336,822 for the nine months ended September 30, 2025, respectively.
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Discussion of Certain Balance Sheet Items
The following table sets forth selected information from our condensed consolidated balance sheets as of September 30, 2026 and December 31, 2025. This information should be read together with our condensed consolidated financial statements and related notes included elsewhere in this Form 10-Q.
| September 30, | December 31, | Variance in | ||||||||||
| 2026 | 2025 | Amount | ||||||||||
| ASSETS | ||||||||||||
| Current Assets | ||||||||||||
| Cash and cash equivalents | $ | 143,470 | $ | 118,356 | $ | 25,114 | ||||||
| Restricted cash | 9,012 | 3,857 | 5,155 | |||||||||
| Accounts receivable, net | 39,794 | 23,922 | 15,872 | |||||||||
| USDC | 359 | 484 | (125 | ) | ||||||||
| Net investment in lease – current, net | 2,644 | 4,261 | (1,617 | ) | ||||||||
| Loans receivable | 400 | 400 | - | |||||||||
| Digital asset collateral receivable | 37,103 | - | 37,103 | |||||||||
| Other current assets, net | 28,606 | 26,735 | 1,871 | |||||||||
| Total Current Assets | 261,388 | 178,015 | 83,373 | |||||||||
| Non-Current Assets | ||||||||||||
| Deposits for property, plant, and equipment | 158,537 | 52,838 | 105,699 | |||||||||
| Property, plant, and equipment, net | 760,232 | 360,243 | 399,989 | |||||||||
| Goodwill | 19,474 | 20,146 | (672 | ) | ||||||||
| Digital assets | 200,534 | 415,734 | (215,200 | ) | ||||||||
| Digital intangible assets | 98,276 | - | 98,276 | |||||||||
| Intangible assets, net | 11,872 | 12,821 | (949 | ) | ||||||||
| Operating lease right of use assets, net | 68,647 | 12,053 | 56,594 | |||||||||
| Finance lease right of use assets, net | - | 12,602 | (12,602 | ) | ||||||||
| Net investment in lease - non-current, net | 7,706 | 9,687 | (1,981 | ) | ||||||||
| Investment securities | 80,664 | 69,121 | 11,543 | |||||||||
| Deferred tax asset | 10,263 | 2,578 | 7,685 | |||||||||
| Other non-current assets, net | 40,500 | 28,580 | 11,920 | |||||||||
| Total Non-Current Assets | 1,456,705 | 996,403 | 460,302 | |||||||||
| Total Assets | $ | 1,718,093 | $ | 1,174,418 | 543,675 | |||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||
| Current Liabilities | ||||||||||||
| Accounts payable | $ | 8,862 | $ | 8,875 | (13 | ) | ||||||
| Current portion of deferred revenue | 54,636 | 7,997 | 46,639 | |||||||||
| Current portion of operating lease liabilities | 13,179 | 5,549 | 7,630 | |||||||||
| Current portion of finance lease liabilities | - | 12,911 | (12,911 | ) | ||||||||
| Short-term debt and current portion of long-term debt, net | 41,873 | - | 41,873 | |||||||||
| Income tax payable | - | 1,547 | (1,547 | ) | ||||||||
| Other payables and accrued liabilities | 73,877 | 56,067 | 17,810 | |||||||||
| Total Current Liabilities | 192,427 | 92,946 | 99,481 | |||||||||
| Non-Current Liabilities | ||||||||||||
| Non-current portion of deferred revenue | 251,398 | 71,554 | 179,844 | |||||||||
| Non-current portion of operating lease liabilities | 56,297 | 5,415 | 50,882 | |||||||||
| Long-term debt, net | 30,683 | - | 30,683 | |||||||||
| Convertible notes payable, net | 445,330 | 110,291 | 335,039 | |||||||||
| Derivative liability | 13,239 | 19,260 | (6,021 | ) | ||||||||
| Deferred tax liabilities | 17,698 | 9,691 | 8,007 | |||||||||
| Other long-term liabilities | 6,279 | - | 6,279 | |||||||||
| Total Non-Current Liabilities | 820,924 | 216,211 | 604,713 | |||||||||
| Total Liabilities | $ | 1,013,351 | $ | 309,157 | 704,194 | |||||||
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Cash and cash equivalents
Cash and cash equivalents primarily consist of funds deposited with banks, which are highly liquid and are unrestricted to withdrawal or use. The total balance of cash and cash equivalents was $143.5 million and $118.4 million as of September 30, 2026 and December 31, 2025, respectively. The increase in the balance of cash and cash equivalents was a result of net cash of $527.1 million used in investing activities, partially offset by net cash of $163.2 million provided by operating activities and net cash of $393.5 million provided by financing activities.
Restricted cash
Restricted cash primarily represents cash balances that support outstanding letters of credit to third parties related to security deposits and other restricted balances. The increase of $5.2 million was primarily attributable to $4.0 million held in an escrow account, a $0.6 million increase in cash collateral for the letter of credit in Iceland and a $0.5 million deposit held as collateral for a secured corporate credit card. As of September 30, 2026 and December 31, 2025, restricted cash totaled $9.0 million and $3.9 million, respectively.
Accounts receivable, net
Accounts receivable, net consists of amounts due from our customers. The total balance of accounts receivable, net was $39.8 million and $23.9 million as of September 30, 2026 and December 31, 2025, respectively. The increase in the balance of accounts receivable is attributable primarily to $33.8 million relating to prepayment billings that were offset by the settlement of $17.7 million of receivables relating to the timing of collections and write-offs relating to one of our discontinued customers.
Net investment in lease, net
Net investment in lease, net represents the present value of the lease payments not yet received from lessees. The current and non-current balance of net investment in lease was $2.6 million and $7.7 million, respectively as of September 30, 2026 due to sales-type lease agreements as a lessor for its cloud service equipment. The current and non-current balance of net investment in lease was $4.3 million and $9.7 million, respectively as of December 31, 2025. The decrease in the balance of net investment in lease was a result of the termination of a sales-type leases totaling $1.4 million and $3.2 million of lease payments collected from equipment leasing customers, partially offset by $1.0 million in interest income earned.
Other current assets, net
Other current assets, net were $28.6 million and $26.7 million as of September 30, 2026 and December 31, 2025, respectively. The increase in the balance of other current assets was mainly attributable to an increase in receivable from third parties of $4.3 million and an increase of $2.6 million in funds held in escrow and prepaid income tax of $1.0 million, partially offset by a decrease in prepayment to third parties of $2.7 million, and a decrease in deposits made to our service provider of $2.8 million.
Digital assets
Digital assets primarily consist of BTC and ETH. For the nine months ended September 30, 2026, we earned digital assets from mining services and ETH staking services. We exchanged BTC into ETH or USDC, exchanged BTC and ETH into cash, or used BTC and ETH to pay certain operating costs and other expenses. Digital assets held are accounted for as intangible assets measured at fair value, with changes in fair value recorded in net income in each reporting period.
As compared with the balance as of December 31, 2025, the balance of digital assets as of September 30, 2026 decreased by $215.2 million, which was primarily attributable to the generation of bitcoins of $8.1 million from our mining business, generation of ETH of $4.2 million from our native staking business, exchange of $20.0 million cash into ETH, partially offset by the change in fair value of $65.8 million, exchange of bitcoins of $6.1 million into cash, exchange of BTC into USDC of $1.4 million, exchange of ETH into cash of $5.9 million, exchange of ETH into LsETH of $167.9 million and payment of BTC for service charges from mining facilities of $0.4 million.
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Digital intangible assets
Digital intangible assets were $98.3 million as of September 30, 2026, compared with $nil as of December 31, 2025. The increase was primarily attributable to the Company’s liquid staking of 73,235 ETH during the nine months ended September 30, 2026, through which it received 66,192 LsETH. A portion of the LsETH holdings was subsequently pledged as collateral for borrowings. Refer to Note 5. Digital Assets Holdings and Note 6. Digital Asset Collateral Receivable, for additional information.
Deposits for property, plant, and equipment
The deposits for property, plant, and equipment consists of advance payments for property, plant, and equipment. The balance is derecognized once the control of the property, plant, and equipment is transferred to and obtained by us.
Compared with December 31, 2025, the balance as of September 30, 2026 increased $105.7 million, mainly due to prepayment of $185.9 million for property, plant and equipment, offset by the reclassification of $80.2 million to property and equipment.
Property, plant, and equipment, net
Property, plant, and equipment primarily consist of service equipment used in our Cloud services and Colocation businesses, digital asset businesses, internally developed software used in our Cloud services business, and construction in progress (“CIP”) representing assets received but not yet put into service in our Cloud services and Colocation businesses.
As of September 30, 2026, we had 20,192 bitcoin miners with net book value of $13.4 million. As of December 31, 2025, we had 21,354 bitcoin miners with net book value of $23.4 million. Compared with December 31, 2025, the decrease in the net book value of our bitcoin miners from $23.4 million as of December 31, 2025 to $13.4 million as of September 30, 2026 was primarily attributable to depreciation expense recognized during the nine months ended September 30, 2026, as well as the disposal of bitcoin miners sold during the third quarter of 2026.
As of September 30, 2026, the Cloud service equipment had a net book value, including CIP, of $105.9 million. As of December 31, 2025, the Cloud service equipment and internally developed software had a net book value, including CIP, of $124.0 million. Compared with December 31, 2025, the balance as of September 30, 2026 decreased by $18.1 million, mainly due to the sale of H200 servers with a carrying value of $23.8 million as well as the one-time write-off due to the discontinuation of the internally developed software operations in the amount of $5.0 million.
As of September 30, 2026, the Colocation service equipment had a net book value, including CIP, of $640.8 million. As of December 31, 2025, the Colocation service equipment had a net book value, including CIP, of $212.6 million. Compared with December 31, 2025, the balance as of September 30, 2026 increased by $428.2 million, mainly due to $409.3 million of development costs for the construction of NC-1 facility, $1.1 million of development costs for the MTL-2 facility, $18.2 million for the acquisition of the MTL-3 property as well as infrastructure, CIP and building improvement costs incurred of $4.7 million for MTL-3 in Saint-Jerome and of $2.2 million for MTL-1 in Montreal, in part, by an increase in accumulated depreciation of $3.3 million as well as a foreign-exchange impact of $4 million.
Operating and finance lease right-of-use assets and lease liabilities
As of September 30, 2026, our operating and finance right-of-use assets and lease liabilities were $68.6 million and $69.5 million, respectively. As of December 31, 2025, the Company’s operating and finance right-of-use assets and lease liabilities were $24.7 million and $23.9 million, respectively.
The increase in right-of-use assets of $43.9 million was due to the addition of $63.3 million for operating leases, partially offset by amortization of the right-of-use assets totaling $6.5 million for the nine months ended September 30, 2026 and the reduction of $12.6 million resulting from the Company’s acquisition of the underlying leased assets under its existing finance lease, which was reclassified to property and equipment.
The increase in lease liabilities of $45.6 million was primarily due to the addition of $63.3 million for operating leases and the increase in interest accrued on lease liabilities of $1.6 million, partially offset by the lease payments totaling $19.0 million for the nine months ended September 30, 2026.
Other non-current assets, net
Other non-current assets, net were $40.5 million as of September 30, 2026, compared to $28.6 million as of December 31, 2025, an increase of $11.9 million. The increase was primarily due to a $10.8 million increase in deposits for a new data center colocation agreement, $1.3 million increase in deferred financing costs, and a $0.8 million increase in prepayment to third parties, partially offset by a $1.2 million decrease in deferred contract costs which was reclassified to current.
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Investment securities
As of September 30, 2026, our portfolio consists of investments in three funds, a privately held company via a simple agreement for future equity (“SAFE”), four privately held companies, and a publicly traded company over which the Company neither has control nor significant influence. The total balance of investment securities was $80.7 million and $69.1 million as of September 30, 2026, and December 31, 2025, respectively. The $11.6 million increase in the balance of investment securities was primarily attributable to additional investment of $15.8 million, partially offset by an unfavorable fair value adjustment of $4.2 million.
Goodwill
Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in relation to the Enovum acquisition. As of September 30, 2026 and December 31, 2025, the Company recorded goodwill in the amount of $19.5 million and $20.1 million, respectively, with the change attributable to foreign currency translation adjustments.
Intangible assets, net
Intangible assets pertain to customer relationships acquired in connection with the acquisition of Enovum. Refer to Note 16. Goodwill and Intangible Assets for further information. As of September 30, 2026 and December 31, 2025, the total balance of intangible assets was $11.9 million and $12.8 million, respectively relating to amortization during the period.
Deferred revenue
As of September 30, 2026, the Company’s current and non-current portion of deferred revenue was $54.6 million and $251.4 million, respectively, compared to $8.0 million and $71.6 million, respectively, as of December 31, 2025. The increase in deferred revenue of $226.4 million reflects $229.3 million prepayments from customers for cloud services and data center services to be rendered in the future, partially offset by the recognition of $2.9 million in revenue related to the successful fulfillment of performance obligations from our cloud services and data center services as well as a decrease due to net settlement of receivables and liabilities with a customer upon contract termination.
Other payables and accrued liabilities
Other payables and accrued liabilities were $73.9 million as of September 30, 2026, compared to $56.1 million as of December 31, 2025, an increase of $17.8 million. The increase was primarily due to the increase in payables of $7.6 million which primarily related to the NC-1 facility. The balance also includes approximately $5.5 million increase in deferred share-based compensation liability, accrued liabilities for non-fixed assets of $5.6 million, accrued interest payable of $4.0 million. These increases were partially offset by a decrease in commissions payable of $1.6 million following the write-off relating to the termination agreement of one of our customers, a decrease relating to bonus payable of $2.2 million.
Short-term and long-term debt, net
Short-term and long-term debt, net consists of amounts borrowed under several credit facilities entered into by the Company and its subsidiaries during the nine months ended September 30, 2026, including term loan facilities and collateralized borrowings with Galaxy Digital LLC. Refer to Note 12. Debt, for more information.
As of September 30, 2026 and December 31, 2025, our total short-term and long-term debt, net was $72.6 million and $nil, respectively. The increase was primarily attributable to borrowings under new facilities during the nine months ended September 30, 2026, partially offset by debt issuance costs, discounts and repayments of. Refer to Note 12. Debt, for more information.
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Convertible notes payable, net
The convertible notes payable relates to the purchase agreement entered into by the Company in connection with the issuance of its convertible senior notes.
In October 2025, the Company issued an aggregate principal amount of $150.0 million of 4.0% convertible senior notes due 2030 (the “2030 Notes”), which included the full exercise by the initial purchasers of their option to purchase up to an additional $15.0 million principal amount of the 2030 Notes.
In January 2026, WhiteFiber issued $230.0 million aggregate principal amount of 4.5% convertible senior notes due 2031 (the “2031 Notes”), and in August 2026, WhiteFiber issued $310.0 million aggregate principal amount of 5.00% convertible senior notes due 2032 (the “2032 Notes”). In August 2026, $198.15 million aggregate principal amount of the 2031 Notes was settled in privately negotiated transactions related to the issuance of the 2032 Notes.
As of September 30, 2026 and December 31, 2025, the net carrying amount of the Company’s convertible note payable was $445.3 million and $110.3 million, respectively. Refer to Note 12. Debt, for more information.
Derivative liability
Derivative liability relates to the conversion feature embedded in the 2030 Notes. Refer to Note 13. Fair Value of Financial Instruments, for more information.
As of September 30, 2026 and December 31, 2025, the Company’s derivative liability was $13.2 million and $19.3 million, respectively. The decrease was primarily attributable to changes in the fair value of the derivative liability during the nine months ended September 30, 2026.
Other long-term liabilities
As of September 30, 2026 and December 31, 2025, the Company’s other long-term liabilities were $6.3 million and $nil, respectively. The increase of $6.3 million was primarily attributable to long-term customer deposits.
Non-GAAP Financial Measures
In addition to consolidated U.S. GAAP financial measures, we consistently evaluate our use of and calculation of the non-GAAP financial measures, such as EBITDA and Adjusted EBITDA. These non-GAAP financial measures have not been calculated in accordance with GAAP and should be considered in addition to results prepared in accordance with GAAP and should not be considered as a substitute for, or superior to, GAAP results. In addition, EBITDA and Adjusted EBITDA should not be construed as indicators of our operating performance, liquidity or cash flows generated by operating, investing and financing activities, as there may be significant factors or trends that they fail to address. We caution investors that non-GAAP financial information, by its nature, departs from traditional accounting conventions. Therefore, its use can make it difficult to compare our current results with our results from other reporting periods and with the results of other companies.
EBITDA is computed as net income before interest, taxes, depreciation, and amortization. Adjusted EBITDA is a financial measure defined as our EBITDA adjusted to eliminate the effects of certain non-cash and / or non-recurring items that do not reflect our ongoing strategic business operations, which management believes results in a performance measurement that represents a key indicator of the Company’s core business operations. The adjustments currently include fair value adjustments such as investment securities value changes and non-cash share-based compensation expenses, in addition to other income and expense items.
We believe Adjusted EBITDA can be an important financial measure because it allows management, investors, and our board of directors to evaluate and compare our operating results, including our return on capital and operating efficiencies, from period-to-period by making such adjustments.
Adjusted EBITDA is provided in addition to and should not be considered to be a substitute for, or superior to net income, the comparable measures under U.S. GAAP. Further, Adjusted EBITDA should not be considered as an alternative to revenue growth, net income, diluted earnings per share or any other performance measure derived in accordance with U.S. GAAP, or as an alternative to cash flow from operating activities as a measure of our liquidity. Adjusted EBITDA has limitations as an analytical tool, and you should not consider such measures either in isolation or as substitutes for analyzing our results as reported under U.S. GAAP.
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Reconciliations of Adjusted EBITDA to the most comparable U.S. GAAP financial metric for historical periods are presented in the table below:
| For the Three
Months Ended September 30, | For the Nine
Months Ended September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Reconciliation of non-GAAP income (loss) from operations: | ||||||||||||||||
| Net income (loss) | $ | 600 | $ | 146,725 | $ | (261,343 | ) | $ | 103,887 | |||||||
| Depreciation and amortization expenses | 11,067 | 9,636 | 31,191 | 25,102 | ||||||||||||
| Interest expense | 10,397 | - | 23,544 | - | ||||||||||||
| Income tax expenses | 1,344 | 698 | 306 | 2,961 | ||||||||||||
| EBITDA | 23,408 | 157,059 | (206,302 | ) | 131,950 | |||||||||||
| Adjustments: | ||||||||||||||||
| Net (gain) loss from disposal of property and equipment | (93 | ) | 539 | (1,915 | ) | 873 | ||||||||||
| Induced conversion expense | 80,767 | - | 80,767 | - | ||||||||||||
| Impairment of capitalized software assets | - | - | 5,006 | - | ||||||||||||
| Share-based compensation expenses | 6,182 | 16,293 | 25,807 | 25,803 | ||||||||||||
| Changes in fair value of long-term investments | (17,024 | ) | (7,121 | ) | 4,204 | (6,246 | ) | |||||||||
| Change in fair value of derivative liability | (10,736 | ) | - | (6,021 | ) | - | ||||||||||
| Adjusted EBITDA | $ | 82,504 | $ | 166,770 | $ | (98,454 | ) | $ | 152,380 | |||||||
Liquidity and capital resources
As of September 30, 2026, we had working capital of $69.0 million which includes USDC of $0.4 million, as compared with working capital of $85.1 million as of December 31, 2025. Working capital is the difference between the Company’s current assets and current liabilities.
To date, we have financed our operations primarily through cash flows from operations, sales of our equity securities, the issuance of convertible notes and other debt financing arrangements, including collateralized borrowings secured by our ETH holdings. We plan to support our future operations primarily from cash generated from our operations, equity financings and debt, including secured debt which may include preferred and convertible financing on favorable terms.
We believe our existing cash will be sufficient to fund our anticipated operating cash requirements for at least 12 months following the date of this filing.
On April 29, 2025, the Company filed a registration statement on Form S-3 (No. 333-286841) with the SEC to register up to $500 million of its ordinary shares, preference shares, debt securities, warrants, units and subscription rights (the “Registration Statement”), which included a sales agreement prospectus covering the offering, issuance and sale by the Company of up to a maximum aggregate offering price of $500 million of the Company’s ordinary shares that may be issued and sold under an At The Market Offering Agreement we entered into with H.C. Wainwright & Co., LLC, as sales agent (as amended from time to time, the “Sales Agreement”).
In the first quarter of 2026, the Company sold an aggregate of 2,372,035 ordinary shares in connection with the at-the-market offering. The Company received net proceeds of $4.1 million, net of offering costs.
In the second quarter of 2026, the Company sold an aggregate of 22,997,224 ordinary shares in connection with the at-the-market offering. The Company received net proceeds of $34.5 million, net of offering costs.
In the third quarter of 2026, the Company sold an aggregate of 6,894,367 ordinary shares in connection with the at-the-market offering. The Company received net proceeds of $11.6 million, net of offering costs.
In June 2025, the Company completed an underwritten public offering of its ordinary shares registered under the Registration Statement. In accordance with the terms of the underwriting agreement entered into with B. Riley Securities, Inc., as representative of the several underwriters, the Company sold 75,000,000 ordinary shares at a price to the underwriters of $1.90 per share. The Company received net proceeds of approximately $141.6 million, after deducting the underwriting discount and offering expenses. On July 1, 2025, the underwriters for this public offering fully exercised their option to purchase an additional 11,250,000 ordinary shares, resulting in additional net proceeds to the Company of $21.3 million, after deducting the underwriting discount and offering expenses.
On July 15, 2025, the Company entered into a registered direct offering with B. Riley Securities, Inc. relating to its ordinary shares. In accordance with the terms of the sales agreement, the Company agreed to issue and sell 22,000,000 ordinary shares having an aggregate purchase price of $62.8 million, net of offering costs. The registered direct offering closed on July 15, 2025. The Company intends to use the net proceeds from the registered direct offering to purchase Ethereum.
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On October 31, 2025, the Company filed an automatically effective shelf registration statement on Form S-3 (File No. 333-291205) with the SEC to register an indeterminate amount of its ordinary shares, which included a sales agreement prospectus supplement covering the offering, issuance and sale by the Company of up to a maximum aggregate offering price of up to $2.5 billion of the Company’s ordinary shares that may be issued and sold from time to time pursuant to the Sales Agreement.
2030 Convertible notes
On September 29, 2025, the Company entered into an underwriting agreement with certain financial institutions (collectively the “Underwriters”), pursuant to which the Company agreed to sell $135 million aggregate principal amount of its 4.00% Convertible Notes due 2030. Subsequently, the over-allotment option was exercised under which additional $15 million was sold to the Underwriters, making a total of $150 million aggregate principal amount of the Convertible Notes. The Convertible Notes closed on October 2, 2025 and will mature on October 1, 2030, unless earlier converted, redeemed or repurchased in accordance with their terms as stipulated in the Agreement.
The Notes were issued pursuant to, and are governed by, an indenture (the “Base Indenture”), dated as of October 2, 2025, between the Company and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”), as supplemented by a first supplemental indenture (the “Supplemental Indenture,” and the Base Indenture, as supplemented by the Supplemental Indenture, the “Indenture”), dated as of October 2, 2025, between the Company and the Trustee. The net proceeds from the 2030 Notes offering, after deducting underwriting discounts and commissions and estimated offering expenses, were approximately $143.7 million, including the proceeds from the Underwriters’ exercise of their over-allotment option in full.
2031 and 2032 Convertible notes
In January 2026, WhiteFiber issued $230.0 million aggregate principal amount of 4.50% convertible senior notes due 2031, resulting in net proceeds of approximately $102.1 million after deducting the Zero Strike Call Option premium, initial purchasers’ discounts and offering expenses. The issuance enhances its liquidity and provides additional capital to fund upcoming development projects, including construction activities and other strategic growth initiatives.
In August 2026, WhiteFiber issued $310.0 million aggregate principal amount of its 5.00% Convertible Senior Notes due 2032 (the “2032 Notes”), consisting of an initial issuance of $270.0 million and an additional $40.0 million issued pursuant to the initial purchasers’ exercise of their over-allotment option. The 2032 Notes mature on September 1, 2032, unless earlier converted, redeemed or repurchased in accordance with their terms.
Concurrently with the pricing of the 2032 Notes offering, WhiteFiber entered into privately negotiated transactions with certain holders of the 2031 Notes to convert or repurchase approximately $198.2 million aggregate principal amount of the outstanding 2031 Notes. The transactions were completed on August 21, 2026, through a combination of cash payments and the issuance of approximately 6.3 million WhiteFiber ordinary shares. In connection with these transactions, WhiteFiber recognized an induced conversion expense of approximately $80.8 million during the three months ended September 30, 2026.
The 2031 Notes bear interest at 4.50% per annum, payable semiannually in arrears on February 1 and August 1, and mature on February 1, 2031. The 2032 Notes bear interest at 5.00% per annum and mature on September 1, 2032. Based on the principal amounts outstanding as of September 30, 2026, the combined annual contractual cash interest obligation is approximately $16.9 million, excluding amortization of debt issuance costs and any additional interest payable under the indentures.
The issuance of the 2032 Notes increased our outstanding indebtedness and provided additional financing to support our capital requirements and planned development activities. The partial conversion and repurchase of the 2031 Notes reduced the outstanding principal of those notes and resulted in the recognition of a significant noncash and cash-related induced conversion expense. The transactions also affect our future interest obligations, liquidity requirements and potential dilution from conversion of the outstanding notes.
As of September 30, 2026, approximately $31.9 million aggregate principal amount of the 2031 Notes and $310.0 million aggregate principal amount of the 2032 Notes remained outstanding.
Iceland facility agreement
WhiteFiber Iceland ehf., a subsidiary of WhiteFiber, entered into a secured term loan facility with Landsbankinn hf. in March 2026, providing up to $20.0 million of available borrowings. The Facility bears interest at a floating rate per annum equal to the sum of (i) three month CME Term SOFR (or any successor benchmark), and (ii) an applicable margin of 4.25% per annum and has an initial two-year term, extendable up to four years. The loan is guaranteed by WhiteFiber, Inc. and WhiteFiber AI, Inc.
The Facility allows for up to two drawdowns (minimum $5 million each), with quarterly principal repayments beginning three months after initial borrowing. On April 24, 2026, WhiteFiber drew down $18.0 million under the Facility. On September 11, 2026, WhiteFiber drew down $2.0 million, which was the remaining commitment available under the Facility. As of September 30, 2026, $17.8 million was outstanding under the Facility, net of $2.25 million of the principal repayments, with an average effective interest rate of 10.35%, which includes an average stated interest rate of 7.94%. The Facility is secured by first-ranking security over (i) 100% of WhiteFiber’s shareholding in WhiteFiber Iceland ehf., (ii) designated assets (including GPU servers, CPU servers, IB switches and equipment accessories) at the date of the agreement, and (iii) material assets acquired thereafter (to be secured within 60 days), in each case until all obligations are fully satisfied.
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Royal Bank of Canada Credit Facility
On July 6, 2026, WhiteFiber’s wholly -owned subsidiary, Enovum Data Center Corp., entered into a syndicated credit agreement. The Syndicated Credit Facility Agreement provides for an aggregate of up to approximately CAD $115 million (approximately $80.8 million) to refinance the Amended Credit Agreement and finance its data centers business. The agreement also includes an accordion feature that permits WhiteFiber to increase by up to an additional CAD $25 million (approximately $17.7 million) to refinance the Amended Credit Agreement, subject to the satisfaction of specified conditions. The Syndicated Credit Facility Agreement is a non-revolving facility, and amounts repaid or prepaid may not be reborrowed.
On July 15, 2026, WhiteFiber drew a CORRA loan amount of CAD $36.8 million (approximately $26.2 million) under the Syndicated Credit Facility Agreement.
NC-1 Project Financing Update
On November 9, 2026, WhiteFiber’s subsidiaries entered into the NC-1 Credit Agreement, providing $300.0 million of term loan commitments as described in Note 22, “Subsequent Events.” No loans had been funded as of the date of this report, and funding remains subject to project-readiness, customer-acceptance and other conditions. If funded, proceeds may be used for permitted purposes, subject to the terms and conditions of the NC-1 Credit Agreement. There can be no assurance that funding will occur within the applicable commitment periods or at all.
Collateralized borrowing
On May 20, 2026 and July 30, 2026, the Company drew down $50.0 million and $10.0 million, respectively, under its collateralized borrowing arrangement with Galaxy Digital LLC entered into on March 27, 2026. On September 29, 2026, the Company repaid $30.0 million of the outstanding principal to Galaxy, reducing the outstanding principal balance to $30.0 million as of September 30, 2026.
The borrowing bears interest at 5.5% per annum and is collateralized by LsETH pledged to the lender. The borrowing is an evergreen facility that may be recalled by the lender upon seven days’ notice in accordance with the terms of the loan agreement. As the Company does not have an unconditional right to defer settlement of the borrowing for at least one year after the balance sheet date, the related loan payable is classified as a current liability in the condensed consolidated balance sheets.
The borrowing is subject to collateral maintenance requirements, and the Company may be required to transfer additional collateral or may receive the return of collateral based on changes in the value of the pledged collateral relative to the contractual collateralization thresholds.
Cash flows
| For the Nine
Months Ended September 30, | ||||||||
| 2026 | 2025 | |||||||
| Net Cash Provided by (Used in) Operating Activities | $ | 163,239 | $ | (204,865 | ) | |||
| Net Cash Used in Investing Activities | (527,051 | ) | (164,061 | ) | ||||
| Net Cash Provided by Financing Activities | 393,464 | 452,695 | ||||||
| Net increase in cash, cash equivalents and restricted cash | 29,652 | 83,769 | ||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | 617 | 147 | ||||||
| Cash, cash equivalents and restricted cash, beginning of period | 122,213 | 98,934 | ||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 152,482 | $ | 182,850 | ||||
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Operating Activities
Net cash provided by operating activities was $163.2 million for the nine months ended September 30, 2026, derived mainly from (i) a net loss of $261.3 million for the nine months ended September 30, 2026 adjusted for digital assets mined of $8.1 million from our mining services, depreciation expenses and amortization expense of $31.2 million, impairment of capitalized software assets of $5.0 million, gain from disposal of property, plant and equipment of $1.9 million, gain from net investment in lease of $0.7 million, loss on digital assets of $65.9 million, amortization of discount on debts issued of $6.8 million, share based compensation expenses of $25.8 million, changes in fair value of investment security of $4.2 million, changes in fair value of derivative liability of $6.0 million, current expected credit losses of $2.7 million, digital assets earned from staking of $4.2 million, impairment of digital intangible assets of $49.3 million, gains on digital intangible assets of $16.7 million, induces conversion expense of $80.8 million and (ii) net changes in our operating assets and liabilities, principally comprising of an increase in digital assets and stable coins of $20.2 million, an increase in deferred revenue of $226.5 million, an increase in accounts receivable of $18.6 million, an increase in other payable and accrued liabilities of $6.3 million, an increase in other current assets of $2.3 million, an increase in other non-current assets of $12.0 million, a decrease in right-of-use assets of $6.7 million, a decrease in net investment in lease of $3.6 million, an increase in account payable of $0.5 million, an increase in deferred tax liability of $0.4 million, a decrease in income tax payable of $1.6 million, an increase in other long-term liabilities of $6.3 million and a decrease in lease liability of $5.0 million.
Net cash used in operating activities was $204.9 million for the nine months ended September 30, 2025, derived mainly from (i) a net income of $103.9 million for the nine months ended September 30, 2025 adjusted for digital assets mined of $21.8 million from our mining services, depreciation expenses and amortization expense of $25.1 million, loss from disposal of property, plant and equipment of $0.9 million, gain on digital assets of $146.0 million, share based compensation expenses of $22.4 million, impairment of digital intangible asset of $1.8 million, changes in fair value of investment security of $6.2 million, current expected credit losses of $0.1 million, digital assets earned from staking of $3.8 million and (ii) net changes in our operating assets and liabilities, principally comprising of an increase in digital assets and stable coins of $141.9 million, an increase in digital intangible assets of $19.1 million, decrease in deferred revenue of $23.0 million, an increase in accounts receivable of $12.2 million, a decrease in other payable and accrued liabilities of $0.8 million, a decrease in other current assets of $3.4 million, a decrease in other non-current assets of $3.4 million, a decrease in net investment in lease of $2.3 million, an increase in account payable of $4.2 million, a decrease in operating lease right-of-use assets of $3.9 million, a decrease in lease liability of $3.5 million.
Investing Activities
Net cash used in investing activities was $527.1 million for the nine months ended September 30, 2026, primarily attributable to purchases of and deposits made for property, plant, and equipment of $549.8 million, and investment in equity securities of $15.8 million, partially offset by proceeds from disposal of property, plant and equipment of $26.6 million and proceeds from disposal of digital assets of $11.9 million.
Net cash used in investing activities was $164.1 million for the nine months ended September 30, 2025, primarily attributable to purchases of and deposits made for property, plant, and equipment of $164.0 million, investment in equity securities of $2.0 million, and partially offset by proceeds from disposal of property, plant and equipment of $2.0 million.
Financing Activities
Net cash provided by financing activities was $393.5 million for the nine months ended September 30, 2026, attributable to net proceeds of $50.2 million from at-the-market offering, net proceeds of $522.7 million from convertible debt, net proceeds from issuance of debt from third parties of $124.3 million, partially offset by the purchase of zero-strike call option of $120.0 million, payment of dividends of $0.8 million, repayment of debt of $52.3 million, repayment of convertible notes in a note exchange transaction of $118.0 million and repayment of finance lease liabilities of $12.6 million.
Net cash provided by financing activities was $452.7 million for the nine months ended September 30, 2025, attributable to net proceeds of $58.5 million from the at-the-market offering, net proceeds of $162.6 million from the public offering, net proceeds of $62.8 million from registered direct offering, net proceeds of $147.4 million from changes in ownership interests in subsidiary via IPO, net proceeds of $22.2 million from changes in ownership interests in subsidiary via over-allotment option and offset by the payment of dividends of $0.8 million.
Off-Balance Sheet Arrangements
During the periods presented, we did not have any off-balance sheet arrangements.
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
The Company is exposed to market risks in the ordinary course of business, primarily related to digital asset prices, interest rates, foreign currency exchange rates, energy prices and utility risk.
Risks Regarding the Price of Ethereum (“ETH”)
The Company’s business is focused on active participation in Ethereum (“ETH”) infrastructure and staking strategies to maximize the amount of ETH we earn and hold. As of September 30, 2026, we held approximately 74,606 ETH, recognized at its fair value of $200.2 million.
The market price of ETH is highly volatile, and we cannot accurately predict future price movements. Fluctuations in the market value of ETH directly affect revenue generated from our staking operations and the fair value of our ETH holdings. In addition, any decline in the fair value of the ETH we hold would be reflected in our financial statements as a charge against net income, which could have a material adverse effect on our results of operations and the market price of our securities.
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The following table presents the impact of 10% changes in the price of ETH on our ETH holdings during the applicable period (in thousand):
| For the Three Months Ended September 30, 2026 | For the Three Months Ended September 30, 2025 | |||||||||||||||
| 10% Increase in Price of ETH | 10% Decrease in Price of ETH | 10% Increase in Price of ETH | 10% Decrease in Price of ETH | |||||||||||||
| Increase/ (Decrease) in Net Income | $ | 20,022 | $ | (20,022 | ) | $ | 42,299 | $ | (42,299 | ) | ||||||
The decreased sensitivity to price changes for the three months ended September 30, 2026, compared with the corresponding periods in 2025, was primarily due to the decrease in our ETH holdings as of September 30, 2026, relative to September 30, 2025.
Interest Rate Risk
The Company is exposed to interest rate risk primarily through its variable-rate debt obligations used to finance infrastructure development and capital expenditures. Changes in benchmark interest rates may increase future interest expense and adversely affect cash flows. In addition, fluctuations in interest rates may affect the Company’s ability to obtain financing on favorable terms and increase the cost of future borrowings. The Company monitors its interest rate exposure and may utilize financing arrangements or other risk management strategies intended to mitigate the impact of interest rate fluctuations; however, such activities may not fully offset the effects of changes in interest rates.
Foreign Currency Risk
The Company operates internationally and is exposed to foreign currency exchange rate risk arising from transactions denominated in currencies other than the U.S. dollar, including certain operating expenses, vendor payments and capital expenditures. Fluctuations in foreign currency exchange rates may adversely affect the Company’s results of operations, financial condition and cash flows. To manage a portion of this exposure, the Company may enter into derivative instruments, including foreign currency forward contracts, to reduce the impact of exchange rate fluctuations on certain foreign currency-denominated transactions. The Company’s hedging activities may not fully offset the adverse financial effects of unfavorable movements in foreign currency exchange rates.
Energy Price and Utility Risk
The Company’s cloud business and data center business are energy intensive and, in certain instances, subject to fluctuations in electricity prices and utility availability. Increases in energy costs, changes in energy market conditions or constraints on available electrical capacity could increase operating costs, adversely affect operating margins and impact the timing or ability to deploy additional infrastructure capacity.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Principal Executive Officer and our Principal Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report to ensure that the information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that information required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer, to allow timely decisions regarding required disclosures.
Based on this evaluation, our management, with the participation of our Principal Executive Officer and our Principal Financial Officer, concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of the end of the period covered by this report.
Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in conducting a cost-benefit analysis of possible controls and procedures.
Changes in Internal Control over Financial Reporting
There have been no changes in the Company’s internal control over financial reporting during the quarter-ended September 30, 2026 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
Except as set forth herein, there have been no changes since the filing of the Company’s Form 10-K for the year ended December 31, 2025.
Bit Digital USA, Inc v. Blockfusion USA, Inc. – Superior Court of Delaware
On June 3, 2024, the Company filed suit in Delaware Superior Court against Blockfusion USA, Inc. (“Blockfusion”) alleging claims for breach of contract, conversion, and related claims in connection with, among other things, certain deposits and advances paid to Blockfusion, the return of which is owed to Bit Digital. Bit Digital was seeking in excess of $4.3 million. On October 2, 2024, the Company filed an amended complaint that added a claim for unpaid late development fees. On October 22, 2024, Blockfusion denied the Company’s claims and brought reciprocal breach of contract and related counterclaims. Following limited discovery, the Court granted the Company leave to file a Second Amended Complaint, which the Company filed on August 21, 2025, asserting additional tort and equitable claims, including fraud-based claims, and adding Blockfusion’s Chief Executive Officer as an individual defendant. On September 19, 2025, Blockfusion and the individual defendant moved to dismiss the fraud, unjust enrichment, and accounting claims in the Second Amended Complaint and all claims against the individual defendant. The Company filed its opposition to the motion on October 17, 2025, and the Court held a hearing on the motion on January 6, 2026. At the conclusion of the hearing, the Court granted the motion, dismissing those claims; the claims against the individual defendant were dismissed on the ground that the Court lacked personal jurisdiction. The Company’s claims against Blockfusion for breach of contract and breach of the implied covenant of good faith and fair dealing were not subject to the motion and remain pending.
On March 18, 2026, the Company moved to dismiss two of the four counterclaims that Blockfusion reasserted in its February 11, 2026 answer to the Second Amended Complaint. The Court heard argument on that motion on June 12, 2026. On August 14, 2026, the Court granted the motion in part and denied it in part, dismissing Blockfusion’s counterclaim for breach of the implied covenant of good faith and fair dealing and declining to dismiss its counterclaim for breach of an alleged post-termination agreement. Blockfusion’s counterclaims for breach of contract, breach of the alleged post-termination agreement, and declaratory judgment remain pending. On those counterclaims, Blockfusion seeks damages of not less than $158,907 and declaratory relief.
The litigation is ongoing and remains in an active pretrial phase. The parties are engaged in discovery. No trial date has been set. The Company seeks recovery of its original investment, allegedly improper invoice payments, unpaid contractual amounts, and other damages. The aggregate damages sought exceed $5.0 million.
At this time, the Company cannot reasonably estimate a possible loss, range of loss, or expected recovery associated with this litigation.
Bit Digital USA, Inc. v. Alex Martini-Lo Manto, et. al. – New York Supreme Court, New York County, Commercial Division
On March 4, 2026, the Company filed suit against Alex Martini-Lo Manto, CEO of Blockfusion; Blockfusion; Blockfusion Data Centers, Inc. (now known as Blockfusion Digital Infrastructure, Inc.), the entity that would become the publicly traded parent upon completion of the proposed business combination; and Blue Acquisition Corp., the Special Purpose Acquisition Company (“SPAC”) that is party to the proposed business combination, alleging that the defendants had designed the SPAC merger to avoid paying the Company for Blockfusion’s prejudgment liabilities. The suit asserted claims under the New York Uniform Voidable Transactions Act, fraud claims against defendant Martini-Lo Manto, and a successor-liability claim against the proposed post-combination public company.
Upon filing, the Company also moved for a preliminary injunction enjoining the SPAC transaction. On April 15, 2026, the Court denied that motion. The Company appealed that ruling, and the appeal was subsequently resolved as described below.
On April 29, 2026, Blue Acquisition Corp. and the other defendants filed separate motions to dismiss the Company’s claims. The Company filed its opposition on May 13, 2026.
On July 23, 2026, the Court issued a decision granting the motions in part and denying them in part. The Court dismissed the Company’s claims under the New York Uniform Voidable Transactions Act, which were the only claims asserted against Blockfusion and Blue Acquisition Corp., but permitted the Company’s successor-liability claim against the proposed post-combination public company to proceed. With respect to the fraud claims against Mr. Martini-Lo Manto, the Court permitted the claim based on allegedly fraudulent invoices to proceed and dismissed the remaining fraud claims. In August 2026, the Company agreed to stay its successor-liability claim pending the closing of the proposed business combination. The Company has not moved for leave to replead the dismissed claims or appealed their dismissal.
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The litigation is ongoing and remains in an active pretrial phase. The parties are engaged in discovery. Under the Court’s scheduling orders, document production is to be substantially completed by January 8, 2027, fact depositions are to be completed by February 17, 2027, and the note of issue is to be filed by March 10, 2027. The remaining fraud claim seeks damages of not less than $576,250.50, plus consequential and punitive damages and interest, and the stayed successor-liability claim seeks a judgment declaring the post-combination public company liable, as successor to Blockfusion, for Blockfusion’s obligations to the Company.
At this time, the Company cannot reasonably estimate a possible loss, range of loss, or expected recovery associated with this litigation.
Bit Digital USA, Inc. v. Alex Martini-Lo Manto, et. al. – New York Supreme Court, Appellate Division, First Department
On April 21, 2026, the Company filed a notice of appeal from the Commercial Division’s denial of the preliminary injunction. The Company also filed a request for interim appellate injunctive relief. On May 22, 2026, the Appellate Division issued an interim order, pending determination of the application by a full panel, directing the defendants to escrow $5.4 million on or before June 1, 2026 and directing the Company to post a $100,000 undertaking. The escrow was not funded. Instead, on June 5, 2026, Blockfusion Data Centers, Inc. (now known as Blockfusion Digital Infrastructure, Inc.), the entity that would become the publicly traded parent upon completion of the proposed business combination, executed a limited guarantee in favor of the Company. Subject to its terms, the guarantee covers payment of the net amount, if any, that Blockfusion is finally determined to owe the Company in the Delaware or New York actions under a final, non-appealable judgment (or a settlement to which the guarantor consents in writing), after giving effect to defenses, counterclaims, and rights of setoff to the extent adjudicated, resolved, or otherwise reflected in that judgment or settlement, and is capped at that amount. The guarantee also provides that, within ten business days after the entry of a trial-court judgment against Blockfusion in either action, or the execution by Blockfusion of a written settlement agreement, in each case whether or not then final, the guarantor will deposit the net amount awarded or agreed to be paid into a mutually agreed escrow account, to be held pending final disposition of the litigation. By its terms, the guarantee will not become effective unless and until the proposed business combination closes, and it will be null and void if the transaction is not consummated. In connection with the guarantee, the Company withdrew its appeal on June 6, 2026, and the interim order is no longer in effect. The proposed business combination has not yet closed. According to Current Reports on Form 8-K filed by Blue Acquisition Corp., the parties to the business combination agreement amended it on September 2, 2026 to provide that either Blue Acquisition Corp. or Blockfusion may, subject to certain exceptions, terminate the agreement if the conditions to closing have not been satisfied or waived by November 30, 2026, and amended it further on September 21, 2026 without changing that date.
At this time, the Company cannot reasonably estimate a possible loss, range of loss, or expected recovery associated with this litigation.
Item 1A. Risk Factors
Except as set forth below, there have been no material changes from risk factors as previously disclosed in the Company’s Annual Report on Form 10-K for the year-ended December 31, 2025 (“Annual Report”) in response to Item 1A to PART 1 of Form 10-K. You should refer to the other information set forth in this report, including the information set forth in “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, as well as in our consolidated financial statements and the related notes. Our business prospects, financial condition or results of operations could be adversely affected by any of these risks.
Please note the following in considering the risk factor in our Annual Report titled “Uncertainty in the global economy and instability within international relations, including changes in governmental policies relating to technology, and any potential downturn in the semiconductor and electronics industries, may negatively impact our business”: In addition, the armed conflict between the U.S. and its allies and Iran has caused a substantial closure of the Strait of Hormuz and further disruption of trade routes in the Red Sea, which has had a significant impact in the Middle East region and on global oil markets. We cannot predict the severity or length of the current conditions impacting international shipping in this region and the continuing disruption of the trade routes in the region of the Red Sea and Strait of Hormuz. Based on the complex relationship between countries involved in our supply chain, disruptions in shipping and the impact on energy prices could have a material and adverse impact on our financial condition, results of operations, and future performance.
Increased scrutiny of data center development and changes in governmental or utility policies could delay or restrict our expansion, limit power availability and increase our costs.
Our ability to develop, retrofit, expand and operate our data centers depends on obtaining and maintaining governmental and utility approvals and securing sufficient power and related infrastructure on commercially acceptable terms. Concerns about electricity affordability, grid reliability, water consumption, noise, emissions and land use could lead federal, state, provincial and local authorities, regulators and utilities in the United States and Canada to impose additional requirements or restrictions on data centers and the infrastructure needed to serve them. Changes in political leadership or governmental priorities could intensify this scrutiny or result in changes in applicable laws, policies, regulatory interpretation or enforcement.
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These developments could delay or prevent permitting, interconnection or approval of generation, transmission, distribution or other utility infrastructure, limit additional power allocations, impose development moratoria or require data center customers to bear a greater share of infrastructure costs. Such requirements or restrictions could affect retrofits, expansions and subsequent development phases, including at sites we have acquired, projects for which we have incurred substantial expenditures or facilities for which we have obtained initial approvals. Our planned expansion at NC-1 and development of our recently acquired Yadkinville properties in North Carolina depend in part on additional power availability and related infrastructure. Existing power arrangements, site approvals or the commencement of operations at a facility do not assure that additional capacity will be available for future phases on the terms or schedules we anticipate.
Approval or power availability delays and additional requirements could require project redesigns, mitigation measures or further capital contributions, postpone revenue generation, increase construction and financing costs and impair our ability to meet customer commitments. Although certain electricity and operating costs may be passed through to customers under our agreements, we may be unable to recover all additional development, infrastructure or other costs, recover our investment or achieve expected returns. Any of these outcomes could materially adversely affect our business, financial condition, results of operations, cash flows and growth prospects.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None. Previously reported on Form 8-K.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
10b5-1 Trading Arrangements
During the three months ended September 30, 2026, no director or officer of the Company
Amendment to Amanda Cassatt Director Agreement
On November 9, 2026, the Company entered into an Amendment to Director Agreement dated December 10, 2025 with Amanda Cassatt. The Directorship Term was extended to the earlier of (a) one year from November 9, 2026, subject to re-election by a majority of the Company’s shareholders; (b) death of the director; (c) termination by mutual agreement; or (d) resignation due to conflicts with the director’s current affiliation with Serotonin. A copy of the amendment is attached hereto as Exhibit 10.1.
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Item 6. Exhibits.
(a) Exhibits.
| Exhibit No. | Document Description | |
| 3.1 | Certificate of Incorporation, as amended(1) | |
| 3.2 | Amended and Restated Memorandum of Association(2) | |
| 3.3 | Amended and Restated Articles of Association adopted July 29, 2026(3) | |
| 10.1 | Amendment to Director Agreement with Amanda Cassatt *** | |
| 31.1 | Certification of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*** | |
| 31.2 | Certification of PFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*** | |
| 32.1 | Certification of CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*** | |
| 32.2 | Certification of PFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*** | |
| 101.INS* | Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).** | |
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document.** | |
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document.** | |
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document.** | |
| 101.LAB* | Inline XBRL Taxonomy Extension Labels Linkbase Document.** | |
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document.** | |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).** |
| * | This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings. |
| ** | XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections. |
| *** | Filed with the Report. |
| + | Certain of the schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). |
| The Registrant agrees to furnish supplementally a copy of all omitted exhibits and schedules to the SEC upon its request. |
| 1. | Incorporated by reference to Exhibit 3.1 to the Registrant’s Form F-1 registration statement filed on March 10, 2021 |
| 2. | Incorporated by reference to Exhibit 99.3 to the Registrant’s Current Report on Form 6-K, filed on June 30, 2022 |
| 3. | Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, filed on July 30, 2026 |
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SIGNATURES
In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Bit Digital, Inc. | ||
| Date: November 12, 2026 | By: | /s/ Sam Tabar |
| Sam Tabar | ||
| Chief Executive Officer | ||
| (Principal Executive Officer) | ||
| Date: November 12, 2026 | By: | /s/ Erke Huang |
| Erke Huang | ||
| (Chief Financial Officer) | ||
| (Principal Accounting Officer) |
| Date: November 12, 2026 | By: | /s/ Bryan Ng |
| Bryan Ng | ||
| (Principal Financial Officer) |
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