WhiteFiber, Inc. WYFI Form 10-Q filing Q2 FY2026

Item 1. Financial Statements. Item 1. Financial Statements and Supplementary Data

WHITEFIBER, INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

As of June 30, 2026 and December 31, 2025

(Expressed in thousands, except for the number of shares)

The accompanying notes are an integral part of these condensed consolidated financial statements.

WHITEFIBER, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE LOSS

For the Three and Six Months Ended June 30, 2026 and 2025

(Expressed in thousands, except for the number of shares)

The accompanying notes are an integral part of these condensed consolidated financial statements.

WHITEFIBER, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

For the Three and Six Months Ended June 30, 2026 and 2025

(Expressed in thousands, except for the number of shares)

The accompanying notes are an integral part of these condensed consolidated financial statements.

WHITEFIBER, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Six Months Ended June 30, 2026 and 2025

(Expressed in thousands)

Reconciliation of cash, cash equivalents and restricted cash

The accompanying notes are an integral part of these condensed consolidated financial statements.

WHITEFIBER, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. ORGANIZATION AND PRINCIPAL ACTIVITIES

WhiteFiber, Inc. (“WhiteFiber” or “the Company”) is a leading provider of high-performance computing (“HPC”) data centers and cloud-based HPC graphics processing units (“GPU”) services, which we term cloud services, for customers such as artificial intelligence (“AI”) applications and machine learning (“ML”) developers. Our HPC Tier-3 data centers provide hosting and colocation services. Our cloud services support generative AI workstreams, especially training and inference. WhiteFiber ordinary shares, par value $0.01 per share (the “Ordinary Shares”), are listed on the Nasdaq Stock Market LLC (Nasdaq:WYFI). The terms “we,” “us,” “our” or the “Company” mean WhiteFiber and its consolidated or combined subsidiaries.

On August 8, 2025, we completed the initial public offering (“IPO” or “Offering”) of our Ordinary Shares at a public offering price of $17.00 per share. The Company and B. Riley Securities, Inc. and Needham & Company, LLC, as representatives of the several underwriters (the “Underwriters”), entered into an underwriting agreement (the “Underwriting Agreement”), pursuant to which the Company agreed to offer and sell, and the Underwriters agreed to purchase, 9,375,000 Ordinary Shares. The Underwriters were also granted a 30-day option (“over-allotment option”) to purchase up to an additional 1,406,250 Ordinary Shares. On September 2, 2025, the Underwriters fully exercised their option to purchase the additional 1,406,250 Ordinary Shares at the public offering price of $17.00 per share.

Prior to the consummation of the Offering, the Company entered into a contribution agreement (the “Contribution Agreement”) with Bit Digital Inc. (“Bit Digital” or “BTBT”), pursuant to which Bit Digital contributed (the “Contribution”) its HPC business through the transfer of 100% of the capital shares of its cloud services subsidiary, WhiteFiber AI, Inc. and its wholly-owned subsidiaries WhiteFiber HPC, Inc., WhiteFiber Canada, Inc., WhiteFiber Japan G.K. and WhiteFiber Iceland, ehf, to WhiteFiber in exchange for 27,043,749 ordinary shares of WhiteFiber (the “Reorganization”). Pursuant to the Contribution Agreement, the transfer was accounted for as a common control transaction immediately prior to the IPO. The Contribution became effective on August 6, 2025, when the registration statement on Form S-1, as amended (File No. 333-288650), of WhiteFiber (the “Registration Statement”) was declared effective by the SEC. WhiteFiber AI became a wholly-owned subsidiary of WhiteFiber, Inc. and Bit Digital became the direct shareholder of WhiteFiber after the Reorganization. As of the date of this Form 10-Q, Bit Digital owns approximately 69.6% of WhiteFiber.

The accompanying unaudited condensed consolidated financial statements reflect the activities of the Company and each of the following entities:

WhiteFiber France I SAS

• A French company 100% owned by WhiteFiber AI, Inc.
• Incorporated on May 27, 2026
• Engaged in cloud services

Enovum NC-1 Venture LLC

• A Delaware company 100% owned by WhiteFiber, Inc.
• Incorporated on May 7, 2025
• Engaged in HPC data center services

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation and principles of consolidation

The Company’s accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Unless otherwise indicated, amounts are stated in thousands of U.S. dollars, except for share and per share data. The financial statements presented for periods on or after August 6, 2025, the date on which the Contribution was completed, are presented on a consolidated basis, and include the financial position, results of operations and cash flows of the Company. The financial statements for the periods prior to August 6, 2025 are presented on a combined basis, and reflect the historical combined financial position, results of operations and cash flows of WhiteFiber, as the operations were under common control of Bit Digital and reflect the historical combined financial position, results of operations and cash flows of those legal entities. Intercompany transactions and balances have been eliminated.

The financial information for the periods prior to August 6, 2025 represents the historical combined financial position and results of operation of WhiteFiber AI, incorporated on October 19, 2023. The results of Enovum (as defined below) are reflected following its acquisition on October 11, 2024. This information is derived from the consolidated financial statements and accompanying records of Bit Digital using the historical results of operations and historical basis of assets and liabilities of the Company. All revenues and costs as well as assets and liabilities directly associated with the business activity of the Company are included in the condensed combined financial statements. The financial statements also include expense allocations for certain functions provided by Bit Digital, including, but not limited to, certain general corporate expenses related to finance, tax, investor relations, and marketing. These general corporate expenses are included in the condensed consolidated statements of operations within general and administrative expenses. Direct usage has been used to attribute expenses that are specifically identifiable to the Company, where practicable. In certain instances, these expenses have been allocated to the Company primarily based on the percentage of revenue or other allocation methodologies that are considered to be a reasonable reflection of the utilization of the services provided relative to the benefits received. The allocations may not, however, reflect the expense the Company would have incurred as a stand-alone company for the period presented. These costs also may not be indicative of the expenses that the Company will incur in the future or would have incurred if the Company had obtained these services from a third party.

For the period beginning August 6, 2025, the condensed consolidated financial information represents the Company’s financial position and results of operation as a stand-alone public company. Following the Reorganization and IPO, the Company may perform certain functions using its own resources or purchased services. For an interim period following the Reorganization and IPO, however, some of these functions will continue to be provided by Bit Digital, under the Transition Services Agreement entered into between WhiteFiber and Bit Digital on July 30, 2025 (the “Transition Services Agreement”).

Management believes all adjustments necessary for a fair statement of balance sheet, results of operations, and cash flows have been made. Except as otherwise disclosed, all such adjustments are of a normal recurring nature. The Company believes that the disclosures are adequate to make the information presented not misleading. The results of operations for the three and six months ended June 30, 2026 are not necessarily indicative of the results for the full year.

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 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 and realization of deferred tax assets. Actual results could differ from those estimates.

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 the Company’s financial instruments, including cash and cash equivalents, restricted cash, 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 convertible notes at each reporting period was estimated based on significant inputs that are observable in the market, which represent Level 2 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.

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 and comprehensive income (loss).

Deposits for property, plant, and equipment

The deposits for property, plant and equipment represented advance payments for purchases of high performance computing equipment and other equipment used in our colocation services. The Company initially recognizes deposits for property, plant, and equipment when cash is advanced to our suppliers. Subsequently, the Company derecognizes and reclassifies deposits for property, plant, and equipment to property, plant, and equipment when control is transferred to and obtained by the Company.

Below is the roll forward of the balance of deposits for property, plant and equipment for the six months ended June 30, 2026 and for the year ended December 31, 2025, respectively.

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. The estimated useful lives by asset category are:

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.

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 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 lives of customer relationships is 19 years.

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 security

As of June 30, 2026 and December 31, 2025, investment security represents the Company’s investment in a privately held company via a simple agreement for future equity (“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.

Leases

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-cancelable 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.

For leases with a term exceeding 12 months, an operating 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. A corresponding operating 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 operating 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 asset 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.

For sales-type leases where the Company is the lessor, the Company recognizes a net investment in lease, which comprises of 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.”

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. The Company has also borrowed funds from a related party that holds a majority ownership interest in the Company. Such related-party debt is accounted for on the same basis as the Company’s third-party notes and loans payable and is presented separately from third-party debt on the condensed consolidated balance sheets. See Note 17. Related Party Transactions, for further details.

Convertible note 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 zero-strike call options 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.

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 services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange. Refer to Note 3. Revenue from Contracts with Customers for further information.

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 June 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 has 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 our cloud services, including cloud services operations - electricity costs, data center lease expense, GPU servers lease expense, third party customer support fee, and other relevant costs, and (ii) direct production costs related to our colocation services, including electricity costs, lease costs data center employees’ wage expenses, and other relevant costs.

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 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. Our CODM is comprised of the Chief Executive Officer and Chief Financial Officer who use segment gross profit (loss) to assess the performance of the business of our reportable operating segments. Asset information is not used by the CODM to evaluate performance or allocate resources.

Income taxes

We account for current and deferred income taxes in accordance with the authoritative guidance, which requires that the income tax impact is 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 50% likely of being realized upon ultimate settlement.

Earnings (loss) per shar**e

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.

Related party transactions

The Company accounts for related party transactions in accordance with ASC 850, Related Party Disclosures. Related parties include the Company’s principal shareholders, subsidiaries, affiliates, directors, executive officers, and entities under common control or significant influence, as well as any immediate family members of such persons.

Transactions with related parties are identified and recorded based on written agreements or other substantiating documentation and are undertaken in the ordinary course of business. Management evaluates whether terms of related party transactions are consistent with those that could be obtained in arm’s-length transactions. Significant related party balances and transactions are disclosed in the financial statements when material.

The Company discloses the nature of its related-party relationships, the type and amounts of transactions, outstanding balances (including receivables and payables), and any commitments or guarantees with related parties in the notes to the financial statements. Amounts due from or to related parties are generally unsecured, non-interest-bearing, and settled in cash unless otherwise disclosed.

In preparing the financial statements, management evaluates whether any related-party transactions require elimination upon consolidation, recognition of gain or loss, or reclassification, and ensures that appropriate disclosures are made for all material transactions.

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’s eligible employees have traditionally participated in Bit Digital’s shared-based compensation plans and continued to do so until the IPO was completed. The Company recognized compensation expenses for its employees and non-employees, in addition to an allocation portion of share-based compensation expenses associated with Bit Digital’s shared employees.

On February 6, 2025, the Board of Directors of WhiteFiber adopted the 2025 Omnibus Equity Incentive Plan (the “2025 Plan”) pursuant to which 4,000,000 Ordinary Shares are authorized for issuance with respect to awards that may be granted to any directors, employees and consultants of the Company or affiliated companies. The 2025 Plan provides for Plan provides share-based compensation such as restricted stock units (“RSUs”), incentive and non-statutory stock options, restricted shares, share appreciation rights and share payments.

After the IPO, the Company’s eligible employees participate in WhiteFiber’s shared-based compensation plans. The Company accounts for share-based compensation in accordance with ASC 718, Compensation and ASC 505, Equity, which require all share-based payments to employees and members of the board of directors to be recognized as expense in the consolidated financial statements based on their grant date fair values. The Company has elected not to estimate forfeitures of its share-based compensation awards but recognizes the reversal in compensation expense in the period in which the forfeiture occurs. 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 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.

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 June 30, 2026 or on the statements of operations for the three and six months ended June 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 ensures 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 2024-03, 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 specified in the updated guidance. 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, the 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.

3. REVENUE FROM CONTRACTS WITH CUSTOMERS

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”).

To determine revenue recognition for contracts with customers, 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 services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange.

The Company is currently engaged in high performance computing (“HPC”) business, including cloud services and colocation services through its operation of HPC data centers.

Disaggregation of revenues

Revenue disaggregated by reportable segment is presented in Note 16. 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. Beginning in March 2026, the Company generated 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 by providing customers with physical space, power, and cooling within the data center facility.

Our revenue is primarily derived from recurring revenue streams, mainly (1) colocation, which is the leasing of cabinet space and power, and (2) connectivity services, which includes 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 five 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.

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 for any credits or cash payments given to the customer.

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 June 30, 2026, capitalized costs to obtain a contract totaled $24.2 million, and the outstanding commission expense payable was $12.3 million, which is included within Other payables and accrued liabilities. As of December 31, 2025, capitalized costs to obtain a contract totaled $25.2 million, and the outstanding commission expense payable was $13.7 million.

Contract assets

Contract assets primarily consist of revenue allocated to complimentary services provided to customers as part of contractual arrangements. As of June 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. As of June 30, 2026 and December 31, 2025, contract liabilities were $143.1 million and $79.6 million, respectively.

During the three months ended June 30, 2026 and 2025, $0.7 million and $11.4 million, respectively, and during the six months ended June 30, 2026 and 2025, $1.4 million and $22.5 million, respectively, of the beginning balance of contract liabilities was recognized as revenue.

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 as of June 30, 2026:

The amounts presented in the table above exclude variable consideration allocated entirely to wholly unsatisfied performance obligations. Such amounts have been excluded from the disclosure of remaining performance obligations in accordance with ASC 606, as the consideration is not fixed and determinable.

During the three months ended June 30, 2026 and 2025, $4.3 million and $1.7 million, respectively, and during the six months ended June 30, 2026 and 2025, $9.5 million and $3.7 million, respectively, were recognized as revenue as a result of satisfying performance obligations in previous periods.

4. ACQUISITIONS

Real Estate Acquisition – Madison, North Carolina

On May 20, 2025, the Company 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 $45.0 million in cash, including the initial deposit of $2.2 million.

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 $45.0 million. No identifiable intangible assets were acquired, no goodwill was recognized, and no liabilities were assumed in connection with the transaction.

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 18. Commitments and Contingencies).

Real Estate Acquisition – Saint-Jérôme, Québec

On May 8, 2026, the Company acquired the land and building comprising its MTL-3 facility in Saint-Jérôme, Québec, for a fixed purchase price of CAD $24.2 million, including related transaction costs of CAD $0.5 million, totaling CAD $24.7 million (approximately $17.3 million). The acquisition was completed pursuant to the purchase option contained in the original 20-year lease agreement dated April 11, 2025.

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 $17.3 million. No identifiable intangible assets were acquired, no goodwill was recognized, and no liabilities were assumed in connection with the transaction.

5. OTHER CURRENT ASSETS, NET

Other current assets were comprised of the following:

(a) The balance of prepayment to third parties primarily consists of the prepayment to our GPU servers leasing partner.

6. LEASES

Lease as Lessee

The Company leases data center capacity, cloud infrastructure, and office space 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 2 to 22 years and may include renewal options, purchase options, or both, depending on the nature of the underlying asset. Certain leases include variable payments based on usage, particularly for cloud services. Variable lease costs are recognized as incurred and are not included in the measurement of the right-of-use assets or lease liabilities.

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 $23.5 million to the lease right-of-use assets and lease liabilities. On December 31, 2025, the Company notified the lessor of its intent to exercise the purchase option. The option was exercised on January 14, 2026 and the purchase of MTL-3 was closed on May 8, 2026. During the first quarter of 2026, the Company remeasured its finance lease liability and right-of-use asset due to a change in the expected closing date of the underlying purchase. No cash was exchanged in this transaction. In the second quarter, upon the purchase of MTL-3, the Company derecognized the finance lease liability of $12.4 million and the right-of-use asset of $12.6 million. The acquired land, building and related improvements were recognized within property, plant and equipment. Refer to Note 7. Property, Plant and Equipment, Net for further details on this transaction.

As of June 30, 2026 and December 31, 2025, right-of-use asset and lease liabilities consisted of the following:

Operating right-of-use assets are recorded net of accumulated amortization of $10.5 million and $7.4 million as of June 30, 2026 and December 31, 2025, respectively.

Finance lease right-of-use asset is recorded net of accumulated amortization of $0.1 million as of December 31, 2025. There was no finance lease right-of use asset as of June 30, 2026.

For the three months ended June 30, 2026 and 2025, the Company’s amortization on the operating lease right-of-use assets totaled $1.6 million and $1.3 million, respectively.

For the six months ended June 30, 2026 and 2025, the Company’s amortization on the operating lease right-of-use assets totaled $3.1 million and $2.4 million, respectively.

For the three months ended June 30, 2026, the Company’s interest expense and amortization on the finance lease were $0.1 million and $0.1 million, respectively. For the three months ended June 30, 2025, the Company’s interest expense and amortization on the finance lease were $nil.

For the six months ended June 30, 2026, the Company’s interest expense and amortization on the finance lease were $0.2 million and $0.2 million, respectively. For the six months ended June 30, 2025, the Company’s interest expense and amortization on the finance lease were $nil.

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:

Additional information regarding the Company’s leasing activities as a lessee is as follows:

The following table represents our future minimum operating lease payments as of June 30, 2026:

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 June 30, 2026 and 2025, the GPU server lease expense amounted to $5.6 million and $3.7 million, respectively and for the six months ended June 30, 2026 and 2025, the GPU server lease expense amounted to $9.3 million and $7.5 million, respectively.

Lease as Lessor

The Company enters into sales-type leases for data storage and cloud service equipment. These leases typically have terms ranging from approximately 2 to 6 years.

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 sub-tenant provides at least 90 days’ notice of non-renewal prior to the end of the then-current term.

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:

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:

In the second quarter of 2026, the Company terminated an existing sales-type lease with a customer, derecognizing $1.4 million of net investment in lease and reclassifying the underlying assets to property, plant, and equipment at their carrying value. The Company then entered into a new sales-type lease with a customer, derecognizing those assets out of property, plant, and equipment and recognizing them as net investment in lease at $0.7 million, the present value of the lease receivable. This transaction resulted in a $0.3 million profit, recorded as "Other income" on the condensed consolidated statement of operations (see Note 7. Property, plant and equipment, for further detail).

The following table illustrates the Company’s future minimum receipts for sales-type lease as of June 30, 2026:

The present value of minimum sales-type receipts of $10.9 million is included in the condensed consolidated balance sheets under the caption “Net investment in lease.”

The following table illustrates the future lease payments to be received from the Company’s sublease tenant as of June 30, 2026 were as follows:

7. PROPERTY, PLANT, AND EQUIPMENT, NET

Property, plant, and equipment, net was comprised of the following:

For the three months ended June 30, 2026 and 2025, depreciation and amortization expenses for property, plant and equipment were $6.4 million and $5.1 million, respectively and for the six months ended June 30, 2026 and 2025, depreciation and amortization expenses were $12.6 million and $8.8 million, respectively. Construction in Progress represents assets received but not placed into service as of June 30, 2026 and December 31, 2025.

For the three and six months ended June 30, 2026 we had an impairment charge of $5.0 million (as described in the section below, Disposals of Property, Plant and Equipment). There were no impairment charges during the three and six month ended June 30, 2025.

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 $10.6 million and $7.9 million, respectively. In the second quarter of 2026, upon termination of a customer agreement, the Company derecognized a net investment in lease of $1.4 million for the related assets and recognized the amount in property, plant, and equipment. The Company then entered into a new sales-type lease arrangement with a customer, and the carrying value of the associated assets were derecognized from property, plant and equipment at their carrying value of $0.3 million, with the related assets recorded as net investment in leases. Refer to Note 6. Leases for further details.

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 6. Leases). The purchase price of CAD $24.2M (approximately $ 17.3 million), and the capitalized transactions costs of CAD $1.4M (approximately $1.0 million), was allocated between land and building based on their relative fair value.

Disposals of Property, Plant and Equipment

For the six months ended June 30, 2026, the Company 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 from disposal of property, plant and equipment. As of the date of this Form 10-Q, the Company has collected the full cash consideration of $26.1 million.

During the six months ended June 30, 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 six months ended June 30, 2026. The impairment charge is presented as a separate line item within operating expenses in the accompanying consolidated statements of operations and is excluded from depreciation and amortization expense.

8. INVESTMENT SECURITY

As of June 30, 2026 and December 31, 2025, investment security represents the Company’s investment of $1.0 million in a privately held company via a simple agreement for future equity (“SAFE”).

On June 30, 2024 (the “Effective Date”), the Company entered into a SAFE agreement for an initial investment amount of $1 million in exchange for a right to participate in a future equity financing of preferred stock to be issued by Canopy Wave Inc. (“Canopy”). Alternatively, upon a liquidity event such as a change in control, a direct listing or an initial public offering, the Company is entitled to receive the greater of (i) the SAFE investment amount plus 15% annual accrued interest (the “cash-out amount”), or (ii) the SAFE investment amount divided by a discount to the price per share of Canopy’s ordinary shares. In a dissolution event, such as a bankruptcy, the Company is entitled to receive the cash-out amount. If the SAFE is outstanding on the three-year anniversary of the Effective Date, then the SAFE will expire and the Company would be entitled to receive the cash-out amount. In the event of a qualifying equity financing, the number of shares of preferred stock received by the Company would be determined by dividing the SAFE investment amount by a discounted price per share of the preferred stock issued in the respective equity financing. The Company recorded an investment of $1 million as an investment in the SAFE on the condensed consolidated balance sheets. Additionally, per the terms of the SAFE arrangement, the Company may be obligated to invest up to an additional $2 million into the SAFE arrangement if Canopy satisfies certain milestones prior to the expiration of the SAFE, or if an equity financing event occurs.

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.

At June 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 six months ended June 30, 2026.

The SAFE agreement was replaced and superseded, in its entirety, by that certain Simple Agreement for Future Equity instrument of Canopy dated as of June 30, 2024 (the “New SAFE”) between the Canopy and WhiteFiber HPC, Inc. Pursuant to that certain Surrender and Termination Agreement, dated as of August 10, 2026, by and among Canopy, WhiteFiber HPC, Inc. and WhiteFiber AI, Inc., the New SAFE was surrendered to Canopy and terminated on the same date.

PIPE Investment

On August 10, 2026, the Company 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, the Company purchased from SAIHEAT, an aggregate of 55,105 SAIHEAT’s Class A Ordinary Shares (the “PIPE Shares”) for aggregate proceeds of approximately $1.0 million at a per-share purchase price of $18.15 per share. The Company has neither control nor significant influence through investment in PIPE Shares. The Company is currently evaluating the appropriate accounting treatment for this investment under U.S. GAAP. The accounting for this investment had not been finalized as of the date these financial statements were issued and will be reflected in the Company's financial statements in the third quarter of 2026. Four members of Bit Digital’s management, including Erke Huang, Bit Digital’s Chief Financial Officer, participated in the PIPE transaction in their personal capacity as investors and invested $0.5 million each in SAIHEAT.

9. OTHER NON-CURRENT ASSETS, NET

Other non-current assets were comprised of the following:

(a) The balance of deposits primarily consisted of the deposits made to a utility company related to our colocation services. The deposits are refundable upon expiration of the agreement.

10. DEBT

2031 Convertible notes

On January 26, 2026, the Company issued $230.0 million aggregate principal amount of 4.50% convertible senior notes due 2031 (the “2031 Notes”), including the exercise in full by the initial purchasers of the 2031 Notes of their option to purchase up to an additional $20.0 million principal amount of the 2031 Notes. The 2031 Notes bear interest at a rate of 4.500% per year, payable semiannually in arrears on February 1 and August 1 of each year, beginning on August 1, 2026. The 2031 Notes will mature on February 1, 2031, unless earlier converted, redeemed or repurchased in accordance with their terms. The Notes were issued pursuant to, and are governed by, an indenture (the “Indenture”), dated as of January 26, 2026, between the Company and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”).

The net proceeds from the 2031 Notes offering, after deducting initial purchasers’ discounts and offering expenses, were approximately $222.1 million, including the proceeds from the exercise in full of initial purchasers’ option to purchase an additional $20.0 million aggregate principal amount of 2031 Notes. The Company used approximately $120 million of the proceeds of the 2031 Notes offering to enter into a zero-strike call option transaction. The estimated fair value of the 2031 Notes was determined to be approximately $407.27 million as of June 30, 2026 based on quoted prices in markets that are not active, which is considered a Level 2 valuation input. While the 2031 Notes bear a 4.500% fixed interest rate, the effective interest rate for the notes as of June 30, 2026 was 5.37%, primarily reflecting the accretion of debt issuance costs.

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, the Company 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 the Company’s election, in the manner and subject to the terms and conditions set forth in the Indenture. The conversion rate is initially 38.5981 ordinary shares per $1 thousand principal amount of the 2031 Notes (equivalent to an initial conversion price of approximately $25.91 per ordinary share), which represents an approximately 27.5% conversion premium over the last reported sale price of $20.32 per ordinary share on the Nasdaq Capital Market on January 21, 2026. The conversion rate is subject to customary adjustments upon the occurrence of certain events, as described in the Indenture.

On February 6, 2029, and if the Company undergoes a “Fundamental Change” (as defined in the Indenture), then, subject to certain conditions and except as set forth in the Indenture, noteholders may require the Company to repurchase for cash all or any portion of their 2031 Notes at a repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the relevant repurchase date.

The Company may not redeem the 2031 Notes prior to February 6, 2029. The Company may redeem for cash all or any portion of the 2031 Notes, at our option, on or after February 6, 2029 and prior to the 41st scheduled trading day immediately preceding the maturity date, if the last reported sale price of our ordinary shares has been at least 130% of the conversion price for the 2031 Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of optional redemption. However, the Company may not redeem less than all of the outstanding 2031 Notes at its option unless at least $75.0 million aggregate principal amount of 2031 Notes are outstanding and not called for optional redemption as of the time it sends the related notice of optional redemption (and after giving effect to the delivery of such notice of optional redemption). The Company may also redeem for cash, in whole but not in part, the 2031 Notes, subject to certain conditions, upon the occurrence of certain changes to the laws, rules or regulations of a relevant taxing jurisdiction (as defined in the Indenture). The redemption price is equal to 100% of the principal amount of the 2031 Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date.

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 25% in aggregate principal amount of the outstanding 2031 Notes may declare 100% of the principal of, and accrued and unpaid interest, if any, on, all the 2031 Notes to be due and payable.

The Company accounts for the 2031 Notes as a single instrument. As of June 30, 2026, none of the conditions permitting the holders of the 2031 Notes to convert their notes early had been met, and to require the Company to repurchase the 2031 Notes for cash. Therefore, the 2031 Notes are classified as long-term.

Zero-Strike Call Option Transaction

In connection with the issuance of the 2031 Notes, the Company 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, the Company paid a premium equal to approximately $120.0 million for the right to receive, without further payment, 5,905,511 ordinary shares (subject to customary adjustment), with delivery thereof by the Option Counterparty at expiry, subject to early settlement of the Zero-Strike Call Option in whole or in part at the Option Counterparty’s discretion. The Zero-Strike Call Option expires on the 40th non-disrupted day (as defined in the Zero-Strike Call Option) following February 1, 2031, or earlier if the Option Counterparty requests early settlement. The settlement method of the Zero-Strike Call Option is physical settlement. The Company will receive the fixed number of ordinary shares determined at the commencement date of the transaction upon expiration or for the portion thereof being settled early, provided that the Zero-Strike Call Option is exercised. The Zero-Strike Call Option is recognized as permanent equity at its fair value at inception as a reduction to additional paid in capital in the condensed consolidated balance sheet.

The following table summarizes the balances of the convertible notes:

The following table summarizes the balances of the Company’s other short-term and long-term debts:

Iceland Facility

On March 25, 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 $20 million. The obligations under the Facility are guaranteed by WhiteFiber, Inc. and WhiteFiber AI, Inc. (collectively, the “Guarantors”).

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.

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 4.25% per annum. The base interest rate is subject to a floor of 0%, such that it will not be less than zero. The Facility has an initial maturity of two years from the date of the agreement, with the option to extend the maturity up to an additional two years, for a maximum term of four years, subject to the terms and conditions of the agreement. Principal repayments are required to be made in quarterly installments commencing three months after the initial drawdown date, with all remaining outstanding amounts due at the maturity date.

The Facility is secured by first-ranking security over (i) 100% of the Company’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. The Facility also includes customary events of default, the occurrence of which could result in the acceleration of amounts outstanding.

The Facility may be drawn in multiple tranches during an availability period, with up to two drawdowns permitted and a minimum draw amount of $5 million per draw. Any undrawn commitments are canceled at the end of the availability period. On April 24, 2026, the Company drew down $18 million.

In connection with the entry into the Facility, the Borrower paid an arrangement fee of $0.2 million (1.111% of the amount drawn), together with legal, documentation, and other third-party costs, for total debt issuance costs and debt discount of approximately $0.4 million, which were recorded as a direct deduction from the carrying amount of the Facility. The Facility also includes customary financial maintenance covenants, including leverage, equity, and loan to value ratios. The Company was in compliance with required covenants for all applicable periods presented.

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 June 30, 2026, the Facility had an effective interest rate of 10.64%, which includes the stated interest rate of 7.92%.

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 60 million (approximately $43.8 million) to finance its data centers business.

The agreement is non-recourse and comprised of three separate facilities:

• Non-revolving three-year lease facility in the amount of $18.5 million. The lease facility provided for straight-line amortization of six years and capital moratorium of six months after disbursement is complete. RBC could cancel any unutilized portion of the Credit Facility after June 30, 2026. The interest rate was fixed based on the rental rate determined by RBC for the three-year term of the lease.
• Non-revolving term loan facility in the amount of $19.6 million to refinance the Company’s purchase of the real estate and building for a build-to-suit 5 MW (gross) Tier-3 data center in Montreal Canada. The interest rate of the real estate term loan facility was to determined at the time of borrowing, or a floating interest rate ranging from RBP plus 0.75% to CORRA (“Canadian Overnight Repo Rate Average”) plus 250 bps. Payment of principal and interest was due 30 days after drawdown and was repayable in full on the last day of the three-year term.
• 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 $5.8 million and other related supporting documents.

The company agreed to certain financial covenants included 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 $28 million (approximately $20 million). On May 8, 2026, the Company drew CAD $24.7 million (approximately $17.3 million) to finance the acquisition of the MTL-3 facility and its related transaction costs.

Borrowings under the facility bore interest, at the Company’s option, at either (i) Daily Simple CORRA plus 2.75% per annum or (ii) Royal Bank Prime plus 1.00% per annum, with the prime-based rate serving as the default option. The facility had a six-month term from the date of drawdown and required interest-only payments during the term, with the outstanding principal due in full at maturity. The specific borrowing terms were established at the time of each drawdown pursuant to a borrowing request submitted by the Company and accepted by the lender.

Additionally, RBC provided a CAD $8 million (approximately $5.8 million) revolving facility in the form of Letters of Credit and Letters of Guarantee. The fees were determined on a transaction-by-transaction basis, and the facility was available for a 12-month term. As of June 30, 2026, the Company was in compliance with all financial covenants under the credit facility.

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 June 30, 2026, the Company was in compliance with all financial covenants under the credit facility.

On July 15, 2026, the Amended Credit agreement was repaid in full and refinanced through the Syndicated RBC Credit Facility agreement. 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, the Company’s wholly-owned subsidiary, Enovum Data Center Corp. entered into a syndicated credit agreement (“Syndicated RBC Credit Facility 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 the Company 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.

Borrowings under the Syndicated Credit Facility Agreement bear interest, at the Company’s option, at either (i) CORRA-based benchmark rate for such interest period plus 2.45% per annum plus the credit spread adjustment for the applicable interest period (29.547 basis points for one month interest period, 32.138 basis points for a three month interest period and 0 for a daily interest period), or (ii) RBC Prime rate plus 1.00% per annum. The facility has a three-year term from the date of the initial drawdown and requires interest-only payments until the first full quarter after the date of the initial drawdown. The loan will be amortized through quarterly principal repayments based on a 15-year amortization schedule, with the outstanding principal due in full at maturity. The specific borrowing terms are established at the time of each drawdown pursuant to a borrowing request submitted by the Company and accepted by the lender.

The Syndicated 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.

On July 15, 2026, the Company drew a CORRA loan amount of CAD $36.8 million (approximately $26.2 million) under the Syndicated Credit Facility Agreement.

Delayed Draw Term Loan Facility

On May 20, 2026, Enovum NC-1 Venture, LLC (the “Borrower”), a subsidiary of the Company, 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 Bit Digital, providing up to $100 million of available borrowings. The obligations under the Delayed Draw Term Loan Facility are guaranteed by WhiteFiber Operating Partnership, LP (“the Guarantor”).

The available borrowing may be increased to $150 million, subject to the terms and conditions of the agreement. The Delayed Draw Term Loan Facility may be drawn in multiple tranches during an availability period, with a minimum draw amount of $1 million per draw. Any undrawn commitments are canceled at the end of the availability period.

The Delayed Draw Term Loan Facility bears interest at an initial rate of 9.5% per annum, and provides for a rate step down when the following conditions are satisfied: (i) the development of a 40 megawatt phase buildout of an HPC data center located at NC-1 has been substantially complete and (ii) at least 80% of the phase I data center capacity has been leased to tenants at market rates. The loan also includes a MOIC Amount payable upon maturity. The MOIC Amount is equal to the positive difference of (a) (i) 1.1 multiplied by (ii) the principal amount of any advance (excluding any original issue discount) and (b) the cumulative amount of all payments (including interest, payment-in-kind interest, and fees) received by the Lender.

The Delayed Draw Term Loan Facility is secured by first-ranking security over 100% of the Company’s shareholding in Enovum NC-1 Topco, Inc (“the Collateral”) and provides for a Collateral step down in the event Enovum NC-1 Bidco, LLC or another affiliate of Borrower obtains loan financing from institutional investors or other form of permanent financing in respect of the financing of NC-1. Upon the occurrence of such event, the Lender will release any and all liens and security interests it may have in respect of the Collateral. The Delayed Draw Term Loan Facility also includes customary events of default, the occurrence of which could result in the acceleration of amounts outstanding.

In connection with the entry into the Delayed Draw Term Loan Facility, the Borrower is required to pay a commitment fee to the lender.

The Delayed Draw Term Loan Facility permits voluntary prepayments and includes mandatory prepayment provisions in connection with specified events, all as set out in the facility agreement.

On May 26, 2026 the Company executed two draw downs, for $20 million and $30 million, respectively, to support near-term growth initiatives in both its data centers and cloud services businesses, funded at original issue discount of 3%. The draw downs have a maturity of 90 days, and can be extended by 30 days upon mutual agreement of the Borrower, Lender, and Guarantor. Immediately following, on May 26, 2026, the $20 million note was assigned from Bit Digital to B. Riley Securities, Inc. (“B. Riley”).

As of June 30, 2026, the Delayed Draw Term Loan Facility had an effective interest rate of 50.6% which exceeded the contractual interest rate due to the inclusion of the contractual MOIC payment. The short-term nature of the facility resulted in a higher annualized effective interest rate.

On July 27, 2026, an additional $20 million was drawn down on the Delayed Draw Term Loan Facility and on July 31, 2026, an additional $10 million was drawn down. These draw downs each have a maturity of 180 days, and can be extended upon mutual agreement of the Borrower, Lender, and Guarantor.

B. Riley Facility

As discussed above, on May 26, 2026, Bit Digital assigned to B. Riley a $20 million note that was issued to Enovum NC-1 Venture, LLC under the Delayed Draw Term Loan Facility and Security Agreement.

As of June 30, 2026, the B. Riley Facility had an effective interest rate of 50.6%, which exceeded the contractual interest rate due to the inclusion of the contractual MOIC payment. The short-term nature of the facility resulted in a higher annualized effective interest rate.

11. SHARE-BASED COMPENSATION

Certain employees of the Company have historically participated in Bit Digital’s 2023 Omnibus Equity Incentive Plan and 2025 Omnibus Equity Incentive Plan (collectively, the “Bit Digital Plan”) which provide long-term incentive compensation to employees, consultants, officers and directors. Until the IPO was completed, certain employees of the Company continued to participate in the share-based compensation plans authorized and managed by Bit Digital.

On February 6, 2025, the Board of Directors of WhiteFiber adopted the 2025 Omnibus Equity Incentive Plan (the “2025 Plan”) which provides for 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 and up to 4,000,000, as amended, ordinary shares. There have been 1,225,441 RSUs granted as of June 30, 2026.

From time to time, the Company grants equity awards under its 2025 Plan to employees of Bit Digital as consideration for services rendered to the Company. These awards are settled in shares of the Company’s ordinary shares and are accounted for as share-based compensation to non-employee consultants and included within general and administrative expenses.

All awards granted under 2025 plan will settle in WhiteFiber’s ordinary shares and are approved by WhiteFiber’s Compensation Committee of the Board of Directors.

Restricted Stock Units

As of December 31, 2025, the Company had 266,783 awarded and unvested RSUs.

In May 2025, the Company entered into a director agreement with Ms. Ichi Shih, Chair of the Audit Committee. Pursuant to the terms of the agreement, as amended on August 6, 2025, Ms. Shih was allocated 7,059 RSUs with an aggregate value of $0.1 million, determined based on the IPO price. The RSUs were granted upon the commencement of trading of the Company’s ordinary shares on the Nasdaq Capital Market.

In August 2025, in connection with WhiteFiber’s initial public offering, 1,329,037 outstanding and unvested equity awards under the 2023 and 2025 Bit Digital Plans held by WhiteFiber employees were cancelled and replaced with 222,739 RSUs under the 2025 Plan. The original aggregate value of these equity awards were preserved and the terms of the equity awards, such as the award period and vesting schedule continue unchanged.

In 2025, the Company granted 88,235 RSUs to each of the Company’s Chief Executive Officer and Chief Financial Officer in accordance with their compensation arrangements. All of these RSUs were immediately vested.

In 2025, the Company granted 303,281 RSUs to employees, which are subjected to a sixteen-quarter service with a one-year cliff vesting schedule.

In 2024, Bit Digital entered into equity award agreements with certain Enovum employees, pursuant to which such employees have the opportunity to earn additional compensation in the form of Bit Digital’s performance RSUs (“PSU”) tied to Enovum’s achievement of Growth EBITDA associated with new data center sites. Following WhiteFiber’s IPO, the agreements were amended such that any earned PSUs are issued pursuant to the WhiteFiber, Inc. 2025 Omnibus Incentive Plan and settled in WhiteFiber RSUs. PSUs vest upon cumulative Growth EBITDA reaching CAD $5.0 million (CAD $0.5 million initial value), plus 10% of incremental Growth EBITDA thereafter, capped at CAD $100.0 million cumulative Growth EBITDA and CAD $10.0 million in total PSU value. Measurements commenced on December 31, 2025 and occur semi-annually. For the six months ended June 30, 2026, the Company recognized share-based compensation expenses of $4.7 million related to these PSU.

During the six months ended June 30, 2026, the Company granted 197,263 RSUs to each of the Company’s Chief Executive Officer and Chief Financial Officer in accordance with their compensation arrangements. All of these RSUs were immediately vested.

During the six months ended June 30, 2026, the Company granted 22,196 RSUs to employees. All of these RSUs were immediately vested.

During the six months ended June 30, 2026, the Company granted 19,083 RSUs to employees, which are subjected to a sixteen-quarter service vesting schedule.

During the six months ended June 30, 2026, the Company granted 45,750 RSUs to employees, which are subjected to a sixteen-quarter service with a one-year cliff vesting schedule.

For the three months ended June 30, 2026 and 2025, the Company recognized share-based compensation expenses of $3.4 million and $6.5 million (including the allocated stock compensation), respectively and for the six months ended June 30, 2026 and 2025, the Company recognized share-based expenses of $8.5 million and $6.7 million (including the allocated stock compensation), respectively for RSUs issued to employees and directors. As of June 30, 2026, the Company had $1.8 million unrecognized compensation costs related to these unvested RSUs.

As of June 30, 2026, the Company had 124,349 awarded and unvested RSUs.

Other share-based compensation

For the three months ended June 30, 2026 and 2025, the Company recognized share-based compensation expenses of $nil and $nil, respectively and for the six months ended June 30, 2026 and 2025, the Company recognized share-based compensation expenses of $59 thousand and $nil, respectively for the RSUs issued to WhiteFiber employees and directors under the Bit Digital Plan.

For the three months ended March 31, 2026, the Company granted 152,444 RSUs to consultants under the 2025 Plan as consideration for services rendered. Of these, 139,225 shares were fully vested upon issuance, and the remainder of 13,219 shares vested in May 2026 for one consultant. The Company recognized share-based compensation expense of $2.1 million in connection with these grants.

In May 2026, the Company granted 2,683 RSUs to consultants under the 2025 Plan as consideration for services rendered. The RSUs vested immediately upon grant. The Company recognized share-based compensation expense of $70 thousand in connection with these grants.

For the three months ended June 30, 2026 and 2025, the Company recognized total share-based compensation expenses of $0.3 million and $nil, respectively, related to consultants. For the six months ended June 30, 2026 and 2025, the Company recognized total share-based compensation expenses of $2.4 million and $nil, respectively, related to consultants.

12. SHARE CAPITAL

Ordinary shares

On August 8, 2025, WhiteFiber completed its initial public offering (the “Offering”) of 9,375,000 ordinary shares, at a public offering price of $17.00 per share. The initial gross proceeds to WhiteFiber from the Offering were $159.4 million, before deducting underwriting discounts and commissions and offering expenses payable by WhiteFiber. Prior to the consummation of the Offering, Bit Digital held all of the issued and outstanding ordinary shares of WhiteFiber. On September 2, 2025, the underwriters fully exercised their option to purchase an additional 1,406,250 ordinary shares, resulting in additional gross proceeds to WhiteFiber of $23.9 million, before deducting underwriting discounts and commissions and offering expenses payable by WhiteFiber. As of the date of this Form 10-Q, Bit Digital owns approximately 69.6% of the issued and outstanding ordinary shares of WhiteFiber.

As of December 31, 2025, there were 38,344,239 ordinary shares issued and outstanding.

During the six months ended June 30, 2026, 400,091 ordinary shares were issued to the Company’s employees, directors, and consultants in settlement of an equal number of fully vested restricted share units awarded to such individuals and companies by the Company pursuant to grants made under the Company’s 2025 Plan.

In May 2026, 96,871 ordinary shares were issued in connection with the redemption, on a one-for-one basis, of an equal number of exchangeable shares that had been issued in connection with the Company's acquisition of Enovum.

As of June 30, 2026, there were 38,841,201 ordinary shares issued and outstanding.

13. GOODWILL AND INTANGIBLE ASSETS

Goodwill

The components of goodwill as of June 30, 2026 are as follows:

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 June 30, 2026:

The following table presents the Company’s finite-lived intangible assets as of December 31, 2025:

The following table presents the Company’s estimated future amortization of finite-lived intangible assets as of June 30, 2026:

Amortization expense for finite-lived intangible assets for the three months ended June 30, 2026 and June 30, 2025 was $0.2 million and $0.2 million, respectively and for the six months ended June 30, 2026 and June 30, 2025 was $0.4 million and $0.4 million, respectively. The Company did not identify any impairment of its finite-lived intangible assets during the six months ended June 30, 2026.

14. INCOME TAXES

The following table provides details of income taxes:

The effective tax rate was 4.8% and (5.3)% for the three months ended June 30, 2026 and 2025, respectively, and (1.3)% and (16.3)% for the six months ended June 30, 2026 and 2025, respectively. The lower effective tax rates for the six-month period primarily due to geographic mix earning impacts and Net CFC Tested Income or NCTI (a.k.a GILTI) impact. As of June 30, 2026, WhiteFiber Inc and its subsidiaries were not able to benefit from current year foreign losses before taxes due to a valuation allowance recorded against deferred tax assets in certain foreign jurisdictions.

15. 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. 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 June 30, 2026, 124,349 unvested RSUs and 8.9 million ordinary shares issuable upon conversion of the 2031 Notes (based on the initial conversion rate of approximately $25.91 per ordinary share) were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

For the six months ended June 30, 2026, 124,349 unvested RSUs and 8.9 million ordinary shares issuable upon conversion of the 2031 Notes (based on the initial conversion rate of approximately $25.91 per ordinary share) were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

For the three and six months ended June 30, 2025, the Company had no potentially dilutive ordinary share equivalents outstanding, as all outstanding shares were held by its parent and no equity awards or other convertible instruments were issued.

16. SEGMENT REPORTING

The Company has two reportable segments: cloud services and colocation services. The reportable segments are identified based on the types of service performed.

Gross profit (loss) is the segment performance measure the chief operating decision maker (“CODM”) uses to assess the Company’s reportable segments.

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 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 $19.4 million of goodwill from the Enovum acquisition allocated to the Colocation Services segment, the Company does not allocate all assets to the reporting segments as these are managed on an entity-wide basis. Therefore, the Company does not separately disclose the total assets of its reportable operating segments.

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 and comprehensive (loss) income.

The following tables present segment revenue and segment gross profit reviewed by the CODM:

Three Months Ended June 30, 2026

(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.

Three Months Ended June 30, 2025

(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 tables present segment revenue and segment gross profit reviewed by the CODM:

Six Months Ended June 30, 2026

(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.

Six Months Ended June 30, 2025

(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 income before taxes:

(a) Other revenue is primarily attributable to equipment leasing and is therefore not included in the total for segment gross profit

17. RELATED PARTIES

Related-party transactions

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 $8 thousand, a $6 thousand signing bonus, and eligibility for performance-based RSUs. Prior to February 2026, Daniel Jonsson is part of the management team at GreenBlocks ehf which not only provided bitcoin mining hosting services, but also benefited from a facility loan agreement extended by Bit Digital USA Inc., an affiliate of WhiteFiber Iceland ehf. In February 2026, the commercial relationship between Bit Digital USA Inc. and GreenBlocks ehf was terminated. Nonetheless, WhiteFiber Iceland ehf continues to engage GreenBlocks ehf under contract for consulting services pertaining to our high performance computing services in Iceland.

Bit Digital made a payment of $1 million on behalf of WhiteFiber Iceland ehf, when WhiteFiber Iceland ehf entered into a simple agreement for future equity (“SAFE”) agreement for an initial investment amount of $1 million in exchange for a right to participate in a future equity financing of preferred stock to be issued by Canopy Wave Inc. (“Canopy”). By the end of the third quarter of 2024, we had settled this outstanding amount with Bit Digital.

In August 2025, the Company entered into a Professional Services Agreement (“PSA”) with Pruitt Hall, a member of the Company’s Board of Directors, pursuant to which he provides consulting services in connection with the construction of the NC-1 facility. Under the PSA, the Company pays consulting fees ranging from $162 to $312 per hour, depending on the level of consultant involved, subject to a minimum of four hours, plus travel expenses, for the time spent on-site. The PSA may be terminated by either party upon thirty days prior written notice. There were consulting services provided under the PSA during the six months ended June 30, 2026 totaling $0.1 million. On July 30, 2026, the PSA was terminated.

Corporate Restructuring and Capital Contributions

Prior to the consummation of the Offering, the Company entered into a Contribution Agreement with Bit Digital, pursuant to which Bit Digital contributed its HPC business through the transfer of 100% of the capital shares of its cloud services subsidiary, WhiteFiber AI, Inc. and its wholly-owned subsidiaries WhiteFiber HPC, Inc., WhiteFiber Canada, Inc., WhiteFiber Japan G.K. and WhiteFiber Iceland, ehf, to WhiteFiber in exchange for 27,043,749 ordinary shares of WhiteFiber. The Contribution became effective on August 6, 2025, when the Registration Statement was declared effective by the SEC.

On August 8, 2025, WhiteFiber completed its initial public offering (the “Offering”) of 9,375,000 ordinary shares, at a public offering price of $17.00 per share. The initial gross proceeds to WhiteFiber from the Offering were $159.4 million before deducting underwriting discounts and commissions and offering expenses payable by WhiteFiber. Prior to the consummation of the Offering, Bit Digital held all of the issued and outstanding ordinary shares of WhiteFiber. On September 2, 2025, the Underwriters fully exercised their option to purchase an additional 1,406,250 ordinary shares, resulting in additional gross proceeds to WhiteFiber of $23.9 million, before deducting underwriting discounts and commissions and offering expenses payable by WhiteFiber. After giving effect to the Offering, and the Underwriters’ exercise of their over-allotment option in full, Bit Digital held approximately 71.5% of the issued and outstanding ordinary shares of WhiteFiber. As of the date of this Form 10-Q, Bit Digital owns approximately 69.6% of WhiteFiber.

Transition Services Agreement post-IPO

In addition, prior to the consummation of the Offering, Bit Digital entered into the Transition Services Agreement with WhiteFiber, pursuant to which Bit Digital will provide certain services to WhiteFiber, on a transitional basis which will generally be up to 24 months following the effective date of the Registration Statement. The Transition Services Agreement provides for the performance of certain services by Bit Digital for the benefit of WhiteFiber, or in some cases certain services provided by WhiteFiber for the benefit of Bit Digital, 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 Bit Digital as well as WhiteFiber. Messrs. Tabar and Huang have committed to provide the requisite time and effort to fulfill their responsibilities as a full-time officer 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 Bit Digital’s operations. As of August 1, 2026, Mr. 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 the IPO, related intercompany balances are expected to be settled in cash or reflected as payable arrangement, rather than the historical parent investment treatment used before the IPO. For the three and six months ended June, 30, 2026, the fees for these services were $0.9 million and $2.4 million, respectively. As of June 30, 2026, the fees payable by WhiteFiber to Bit Digital are $5.5 million.

Allocation of pre-IPO corporate expenses

Prior to the IPO, Bit Digital provided certain corporate support services to WhiteFiber, including finance, tax, investor relations, and marketing, but did not historically charge the WhiteFiber entities for those services. Bit Digital allocated a portion of Bit Digital’s general corporate expenses to WhiteFiber to reflect the costs of services that benefited WhiteFiber during the periods presented in the financial statements up to the date of the IPO. For the six months ended June, 30, 2025, the Company was allocated $2.8 million for these corporate services. These expenses were allocated to the Company on the basis of direct usage when identifiable, with the remainder allocated on the basis of percent of revenue or other allocation methodologies that are considered to be a reasonable reflection of the utilization of the services provided relative to the benefits received. Management does not believe, however, that it is practicable to estimate what these expenses would have been had the Company operated as an independent entity, including any expenses associated with obtaining any of these services from unaffiliated entities. The pre-IPO allocated expenses were not expected to be settled in cash and were therefore treated as forgiven by Bit Digital and recorded within Parent company net investment.

Following the IPO, WhiteFiber became a separate public company, and certain services continued to be provided by Bit Digital only on a temporary basis under the Transition Services Agreement. Accordingly, the post-IPO treatment should reflect the actual services provided under that agreement. For further details, refer to “Transition Services Agreement post-IPO”.

Guarantees

Bit Digital previously issued a guarantee to a third party on behalf of WhiteFiber Iceland ehf, making Bit Digital 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, Bit Digital is no longer a guarantor under the agreement.

On March 25, 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 $20 million. As of the date of this Form 10-Q, $18 million has been drawn down under this Facility. The obligations under the Facility are guaranteed by WhiteFiber, Inc. and WhiteFiber AI, Inc. Refer to Note 10. Debt for further details on this agreement.

On May 20, 2026, Enovum NC-1 Venture, LLC (the “Borrower”), a subsidiary of the Company, 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 Bit Digital, providing up to $100 million of available borrowings. The available borrowing may be increased to $150 million, subject to the terms and conditions of the agreement. The obligations under the Delayed Draw Term Loan Facility are guaranteed by WhiteFiber Operating Partnership, LP. Refer to Note 10. Debt for further details on this agreement.

On July 15, 2026 Enovum NC-Bidco, LLC (the “Principal”), a subsidiary of the Company, entered into a $3 million surety bond from Great American Insurance Company in favor of Duke Energy Carolinas, LLC. The obligations under the surety bond are guaranteed by WhiteFiber, Inc. and Enovum NC-1 Bidco, LLC. Refer to Note 18. Commitments and contingencies for further details on this agreement.

Delayed Draw Term Loan Facility and Security Agreement

On May 20, 2026, the Company, entered into a Delayed Draw Term Loan Facility and Security Agreement (the “Delayed Draw Term Loan Facility”) with Bit Digital Capital, Inc., a subsidiary of Bit Digital, providing up to $100 million of available borrowings. The available borrowing may be increased to $150 million, subject to the terms and conditions of the agreement. Refer to Note 10. Debt for further details on this agreement.

18. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

From time to time, the Company may be a party to various legal actions arising in the ordinary course of business. The Company accrues costs associated with these matters when they become probable and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred.

Contingent Consideration Liabilities

Unifi Transaction

As part of the Unifi Transaction (See Note 4. Acquisition), the Company 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 $8 million may become payable if, within two years of the acquisition date, the Company uses commercially reasonable efforts and obtains from the local energy provider an Electric Service Agreement for at least 99 megawatts (MW), or if the property otherwise receives 99 MW of power within that timeframe.
• If an Electric Service Agreement for at least 99 MW is provided, or the property receives 99 MW of power within three years, the Company may instead be required to make a contingent payment of $5 million.
• If an Electric Service Agreement is provided, or the property receives more than 99 MW of power within four years, the Company may be required to make an additional payment of $200,000 per MW in excess of 99 MW, up to a maximum of $5 million.

As of June 30, 2026 the Company has not received an Electric Service Agreement of more than 99 MW. Thus, no contingent payment is payable as of the reporting date.

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 the Company’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 $8,754, irrespective of actual usage levels. In addition to standard service, Duke Energy has installed and maintains “Extra Facilities” (including overhead lines, substations, transformers, breakers, and metering equipment). The cost of these Extra Facilities totals approximately $1,137,975, for which the Company pays a monthly facilities charge of $11,405.

The ESA represents a continuing commitment to purchase power at or above the established minimum levels throughout the contract term. As such, the Company 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 60 days’ written notice. In the event of early termination, the Company remains liable for all amounts due under the ESA through the termination date and may incur additional charges associated with the Extra Facilities if service is discontinued prior to the expiration of the facilities term.

On July 15, 2026, the Company obtained a $3 million surety bond from Great American Insurance Company in favor of Duke Energy Carolinas, LLC. The surety bond serves as security for the Company’s payment obligations and may be drawn upon if the Company fails to remit payment to Duke Energy within 30 days after receiving a demand for payment.

As of June 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.

19. SUBSEQUENT EVENTS

Syndicated RBC Credit Facility Agreement

On July 6, 2026, the Company’s wholly-owned subsidiary, Enovum Data Center Corp. entered into a syndicated credit agreement (“Syndicated RBC Credit Facility Agreement”). See Note 10. Debt for additional information.

Delayed Draw Term Loan Facility and Security Agreement

On July 27, 2026, the Company drew down an additional $20 million and on July 31, 2026, the Company drew down an additional $10 million under its existing Delayed Draw Term Loan Facility agreement with Bit Digital Capital, Inc. See Note 10. Debt for additional information.

Data center lease in Sydney

On July 30, 2026, WhiteFiber Australia II Pty Ltd (f/k/a Aurix Digital Pty Ltd), a subsidiary of the Company, entered into a lease of data center space in Sydney, Australia to expand our cloud services offering. The lease, which is guaranteed by WhiteFiber, Inc., is scheduled to commence in the fourth quarter of 2026, has a term of 59 months, and carries a monthly rent of AUD 488 thousand (approximately $344 thousand).

Investment Security

On August 10, 2026, the Company entered into the PIPE Share Purchase Agreement with SAIHEAT Limited for aggregate proceeds of approximately $1.0 million at a per-share purchase price of $18.15 per share. Refer to Note 8. Investment Security for additional information.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following information should be read in conjunction with the condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q for the period ended June 30, 2026 as well as Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2025 (Annual Report). Except for the statements of historical fact, this Form 10-Q 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. The following discussion may contain forward-looking statements that reflect WhiteFiber, Inc.’s plans, estimates and beliefs. WhiteFiber, Inc.’s actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to these differences include those factors discussed below, in the Annual Report and in Part II, Item 1.A of this Form 10-Q, particularly in the sections entitled “Cautionary Statement Regarding Forward-Looking Statements” and “Risk Factors.” Before making an investment decision, you should carefully consider these risks, uncertainties and forward-looking statements.

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 SEC and available on its website at http://www.sec.gov. If any material risk was 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 or 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.

References to “WhiteFiber” or the “Company” refer to WhiteFiber, Inc. and its subsidiaries, giving effect to the Reorganization which occurred on August 6, 2025.

Overview

We believe we are a leading provider of artificial intelligence (“AI”) infrastructure solutions. We own high-performance computing (“HPC”) data centers and provide cloud-based HPC graphics processing units (“GPU”) services, which we term cloud services, for customers such as AI application and machine learning (“ML”) developers (the “HPC Business”). Our Tier-3 data centers provide hosting and colocation services. Our cloud services support generative AI workstreams, especially training and inference.

Our business model integrates our data center infrastructure and cloud services to provide scalable, high-performance computing solutions for enterprises, research institutions, and AI and ML driven businesses. Our 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 our data centers, we are able to provide the power to support our cloud services and we believe we can better meet the needs of AI and ML workloads and reduce the complexity associated with procuring power and connectivity from external vendors. We can also design our 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, our vertically integrated solution allows us to capture additional margin for both our data center and cloud services businesses, avoiding expenses that would otherwise be due to third-party providers.

Colocation/Data center services

We design, develop, and operate data centers, through which we offer our hosting and colocation services. Our 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.

Based on their collective industry experience, our data center team is adept at bringing new sites online on an accelerated timeline. We are aggressively pursuing our development pipeline and intend to achieve an estimated 70 MW (gross) of total data center capacity by the end of the fourth quarter of 2026, a target that is underpinned by assets including our MTL-2, MTL-3, and NC-1 facilities. As of June 30, 2026, our pipeline of potential data center projects represents approximately 1,500 MW (gross) under management review. We follow a disciplined process prioritizing projects that are backed by customer lease commitments. In select cases, we 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 our control.

We use a well-defined set of criteria to select our data center sites. We typically target sites with proximity to metro areas and partial infrastructure in place, where we are 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 we believe 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 the Company, as well as their experience prior to Enovum. We also prioritize sites offering opportunities to increase site power over time, enabling our data centers to grow with customer demand. In addition, we selectively target certain larger opportunities with 50 MW (gross) of power or more, subject to customer demand, to drive AI-driven compute super-clusters. Finally, we prioritize sites powered by sustainable, green energy sources and locked-in power when available. Additionally, to enhance sustainability of certain of our data center projects, we are undertaking heat repurposing projects in connection with sustainability and commercial and residential projects.

We acquired Enovum on October 11, 2024. The transaction included the lease of MTL-1, our 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, we acquired the real estate and building for a build-to-suit 5 MW (gross) Tier-3 data center expansion project near Montreal, Canada which we refer 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. We initially funded the purchase of CAD 33.5 million (approximately $23.3 million) with cash on hand. We expected to invest approximately $23.6 million to develop the site to Tier-3 standards with an initial load of 5 MW (gross). However, we have prioritized other builds and preserved capital for more time sensitive projects.

On April 11, 2025, we 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 is 20 years, with two 5-year extensions at the Company’s option. In December 2025, we became reasonably certain to exercise the purchase option and notified the lessor of our intent to exercise the purchase option. We 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 979 thousand USD) monthly for the duration of the five-year contract.

On May 20, 2025, we completed the purchase of a former industrial/manufacturing building from UMI. Pursuant to the Purchase Agreement we agreed to purchase from UMI, an industrial/manufacturing building together with the underlying land located in Madison, North Carolina, which we refer 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 the Company, 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 the assignment. Refer to Note 18. Commitments and contingencies to our condensed consolidated financial statements for further detail.

As the business grows, the Company’s ability to fund its operating needs will depend on the ongoing ability to generate positive cash flow from our operations and raise capital in the capital markets. Accordingly, the Company has entered into certain credit facilities to finance these areas of growth, including the RBC Facility Agreement discussed here. Refer to Liquidity and capital resources for further discussion on this Facility and other credit facilities of the Company.

RBC Credit Facility

On June 18, 2025, we entered into a non-recourse credit agreement with RBC (as subsequently amended on July 4, 2025, the “original credit agreement”) providing for an aggregate of up to approximately CAD 60 million (approximately $43.8 million) of financing intended primarily to refinance the buildout of MTL-2 and to provide $5.8 million of revolving term financing. The facilities had not been authorized for use by the lender, as certain conditions precedent had not yet been satisfied, and accordingly no amounts were drawn and no borrowings were available under the original credit agreement.

On April 27, 2026, the Company entered into an amended credit agreement with RBC, replacing the original credit agreement dated June 18, 2025, as amended on July 4, 2025. The amended credit agreement provided for an authorized credit facility of CAD $28 million (approximately $20 million), the proceeds of which were used to finance the acquisition of the MTL-3 facility. The amended credit agreement also included a CAD $8 million (approximately $5.8 million) revolving facility in the form of Letters of Credit and Letters of Guarantee, available for a 12-month term. 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 Letters of Credit and Letters of Guarantee facility remains in place.

Syndicated RBC Credit Facility Agreement executed on July 6, 2026

On July 6, 2026, the Company’s wholly-owned subsidiary, Enovum Data Center Corp. entered into a syndicated credit agreement (“Syndicated RBC Credit Facility 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 the Company 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.

Borrowings under the Syndicated Credit Facility Agreement bear interest, at the Company’s option, at either (i) CORRA-based benchmark rate for such interest period plus 2.45% per annum plus the credit spread adjustment for the applicable interest period (29.547 basis points for one month interest period, 32.138 basis points for a three month interest period and 0 for a daily interest period), or (ii) RBC Prime rate plus 1.00% per annum. The facility has a three-year term from the date of the initial drawdown and requires interest-only payments until the first full quarter after the date of the initial drawdown. The loan will be amortized through quarterly principal repayments based on a 15-year amortization schedule, with the outstanding principal due in full at maturity. The specific borrowing terms are established at the time of each drawdown pursuant to a borrowing request submitted by the Company and accepted by the lender.

The Syndicated 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.

On July 15, 2026, the Company drew a CORRA loan amount of CAD $36.8 million (approximately $26.2 million) under the Syndicated Credit Facility Agreement.

Nscale Services Agreement

In November 2025, our 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 our NC-1 facility. The agreement represents a significant commercial milestone for our 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. Billing is expected to commence during the third quarter, subject to completion of construction and commissioning. As a result, we expect full revenue contribution from this agreement to begin during the third quarter of 2026 as the facility reaches its contractual capacity.

Cloud Services

We provide specialized cloud services to support generative AI workstreams, especially training and inference, emphasizing cost-effective utility and tailor-made solutions for each client. We are 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, we are proud to be among the first service providers to offer H200, B200, and GB200 servers. We provide a high-standard service lease with an Uptime percentage> 99.5%.

We are also developing a capital-light managed services offering through which customers would fund the underlying hardware while we deploy and operate it on their behalf. This offering has not yet generated material revenue.

Global Data Center Infrastructure and Partnerships

We expect to leverage a global network of data centers for hosting capacity for our GPU business, in many instances, by negotiating with third-party providers to seamlessly integrate our cloud services at strategically located data centers. Our initial data center partnership through which we lease 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. We have 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, we have leased additional capacity to install our data center in Atlanta, Georgia, USA to expand our cloud services offering. The capacity leases commenced in February 2026. We also intend to lease additional capacity to expand our cloud services offering. In July 2026, we entered into a lease for 2.5 MW IT load Tier 3 design data center space in Sydney, Australia to expand our cloud services offering. The lease is scheduled to commence in the fourth quarter of 2026.

In April 2025, we received our first shipment of NVIDIA GB200 NVL72 system powered NVIDIA GB200 Grace Blackwell Superchips, from Quanta Cloud Technology, a leading provider of data center solutions. We believe that support with proof of concept (POC) access from Quanta will enable us to meet and exceed expectations around delivery and timeline, performance and reliability.

Customer Base and Concentration

As of the date of this Form 10-Q, we have seven existing customers. Our largest customer accounted for approximately 63% of our revenue during the six months ended June 30, 2026. During the period we had discontinuation of three customer orders. The discontinued orders resulted in approximately $5.1M impact to revenue during the six months ended June 30, 2026. However, there were new customer orders contracted in the six months ended June 30, 2026 and through the date of this Form 10-Q for total contracted revenue of $635.8M over a six months to three-year period.

Discontinued customer agreements during the six months ended June 30, 2026 and through the date of this Form 10-Q include: (i) the Company’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 six months ended June 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 that we otherwise consider to be material or representative. We have 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, we finalized a Master Services and Lease Agreement (“MSA”), as amended, with our Initial Customer for the provision of cloud services from a total of 2,048 GPUs over a three-year period. To finance this operation, we 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, we finalized an agreement to supply our Initial Customer with an additional 2,048 GPUs over a three-year period. To finance this operation, we 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, we agreed with the customer to temporarily delay the purchase order so the customer could evaluate an upgrade to newer generation Nvidia GPUs. Consequently, the Company 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, the Company 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 the Company was to provide the customer with an incremental 2,048 H100 GPUs. The contract represents approximately $15 million of annualized revenue and features a two-month prepayment from the customer. Deployment commenced on August 20, 2025, using the Company’s inventory of B200 GPUs.

In October 2025, the Company’s existing parent guaranty arrangement with the Initial Customer was scheduled to expire. Beginning in November 2025, the customer will provide a service deposit to the Company in lieu of the parent guaranty. The deposit will be funded through fifteen consecutive monthly payments of approximately $0.24 million each, totaling $3.6 million, payable 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. The Company 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, the Company 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 the Company 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 the Company a fixed termination fee of $12.3 million that was recognized as revenue during the second quarter of 2026. Subsequently, after quarter-end, the termination fee was amended to $15.7 million. The amended amount of $15.7 million remains outstanding as of the date of this Form 10-Q. Following the service pause and termination of the agreement, the Company redeployed the GPUs previously allocated to the Initial Customer to other customers.

In November 2025, we 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, we have collected $2.2 million of the outstanding amount.

On November 6, 2024, we 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, representing total contracted value of approximately $0.16 million for the term. The deployment commenced on November 7, 2024, using the Company’s existing inventory of H200 GPUs. The service under the purchase order concluded in May 2025. Between May 2025 and September 2025, the Company 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, we 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 14 months beginning on the services commencement date. The service order represents an aggregate revenue opportunity of approximately $1.3 million. The deployment and revenue generation began in March 2026.

In March 2026, we 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 service order represents an aggregate revenue opportunity of approximately $50.2 million. The deployment and revenue generation began in the second quarter of 2026.

In April 2026, the Company 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 service order represents an aggregate revenue opportunity of approximately $0.8 million. The deployment and revenue generation began in the second quarter of 2026.

On January 30, 2025, we entered into a Master Services Agreement (“MSA”) with a minimum purchase commitment of 40 GPUs, along with an associated purchase order, from a new customer. The purchase orders provide for services utilizing a total of 40 H200 GPUs over a minimum of 12 month period, representing total revenue of approximately $0.8 million for the term. In October 2025, the purchase order was amended to reduce the number of H200 GPUs from 40 to 8 and to extend the term of service through May 2027. This contract was terminated in January 2026.

In October 2025, we entered into a two-week service order with a new customer to provide services utilizing a total of 72 B200 GPUs. In January 2026, we 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, we 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. The service order represents an aggregate revenue opportunity of approximately $18.1 million. Deployment and revenue generation commenced in January 2026.

In February 2026, we 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 which is expected to generate total revenues of $3.6 million.

In March 2026, we 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 on March 7, 2026 and will generate a total revenue of up to $1.0 million. Additionally, in April 2026, we entered into a 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 is scheduled to begin in July 2026 generating total revenues of up to $6.8 million.

New Business Developments

In May 2026, we 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, with total contract value in excess of $160 million. Service under this agreement, which was previously expected to commence in July 2026, is now expected to commence in September 2026, subject to final equipment delivery and acceptance milestones. We have secured third-party data center capacity in France to support the deployment and have entered into a binding term sheet for project-level financing with respect to this deployment (the “France Project Financing”). We are 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. While we expect to finalize the France Project Financing in the near term, no definitive agreements have been entered into as of the date of this Quarterly Report, and no assurance can be given that we will enter into such financing on the timeline currently anticipated, on the terms contemplated by the binding term sheet, on other terms satisfactory to us, or at all. If consummated, the France Project Financing is expected to be incurred at a project-level subsidiary and would not be guaranteed by WhiteFiber, Inc. The project is expected to be supported by customer prepayments, including 12 months of advance service fees, and project-level financing, with limited long-term reliance on our corporate balance sheet and existing cash resources.

Also in May 2026, we entered into a two-year cloud services agreement with Hyperbolic Labs, Inc., with Modal Labs as the end customer and reference partner, to deploy H200 GPUs from our existing owned fleet, with total contract value of approximately $17 million. Revenue under this agreement commenced in June 2026. No incremental GPU capital expenditures were required for this deployment.

In July 2026, we 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. The service order represents an aggregate revenue opportunity of approximately $16.0 million.

In August 2026, we entered into a new service order with Prime Intellect to provide services utilizing a total of 576 VR200 (Vera Rubin) GPUs in Canada, representing our first Vera Rubin deployment. This is in addition to the orders placed by this customer of 72 GB200 GPUs in March 2026 and 216 GB200 GPUs in April 2026, discussed above. 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. The service order represents an aggregate revenue opportunity of approximately $108.2 million, with service targeted to commence in the second quarter of 2027. The total revenue contract value with this customer in relation to these three orders is expected to be up to $116.0 million.

In August 2026, we entered into a service order with a new customer, BaseTen Labs, Inc., to provide services utilizing a total of 1,392 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. The service order represents an aggregate revenue opportunity of approximately $165.2 million. The deployment and revenue generation is scheduled to begin in November 2026.

In August 2026, we entered into a new five-year service order with an existing customer to provide services utilizing a total of 576 Nvidia B300s GPUs in Iceland. The service order represents an aggregate revenue opportunity of approximately $87.5 million over its initial term, with additional potential upside through revenue sharing. Service under this agreement is targeted to commence in December 2026.

Reorganization, Initial Public Offering, and Relationship with Bit Digital

We were incorporated by Bit Digital as a Cayman Islands exempted company on August 15, 2024 under the name Celer, Inc., as a holding company for the HPC Business. We changed our name to WhiteFiber, Inc. on October 17, 2024.

On August 6, 2025, we issued 27,043,749 ordinary shares, par value $0.01 per share (our “Ordinary Shares”, and such shares, the “Contribution Shares”), to Bit Digital pursuant to the terms of a Section 351 Contribution Agreement (the “Contribution Agreement”) entered into with Bit Digital on July 30, 2025. Pursuant to the Contribution Agreement, Bit Digital contributed its HPC Business through the transfer of 100% of the capital shares of its cloud services subsidiary, WhiteFiber AI, Inc. and its wholly-owned subsidiaries WhiteFiber HPC, Inc., WhiteFiber Canada, Inc., WhiteFiber Japan G.K. and WhiteFiber Iceland, ehf, to us, upon the effectiveness of the registration statement filed in connection with our IPO and prior to the consummation of the IPO, in exchange for the Contribution Shares. We refer to this transaction as the “Reorganization”. WhiteFiber AI became a wholly-owned subsidiary of WhiteFiber, Inc. and Bit Digital became the direct shareholder of WhiteFiber after the Reorganization.

On August 8, 2025, we completed our initial public offering (“IPO”) of 9,375,000 Ordinary Shares, at a public offering price of $17.00 per share. The gross proceeds to the Company from the IPO were approximately $159.4 million, before deducting underwriting discounts and commissions and offering expenses of $12.0 million. On September 2, 2025, B. Riley Securities, Inc. and Needham & Company, LLC, as representatives of the several Underwriters of the IPO, fully exercised their option to purchase an additional 1,406,250 Ordinary Shares at the public offering price of $17.00 per share, resulting in additional gross proceeds to the Company of approximately $23.9 million.

After giving effect to the IPO and the full exercise by the Underwriters of their over-allotment option, Bit Digital held approximately 71.5% of our issued and outstanding Ordinary Shares. As of the date of this Form 10-Q, Bit Digital owns approximately 69.6% of WhiteFiber.

Following our IPO, certain of our directors, executive officers and other members of senior management continue to serve as directors, officers and employees of Bit Digital. We have added additional executive officers and senior management to our senior executive team apart from those serving as officers and employees of Bit Digital. We have assembled a senior operating team with approximately 15 years of experience on average for each individual in the data center and cloud services industries. We also appointed additional independent directors upon the commencement of trading of our Ordinary Shares on Nasdaq.

Key Factors that May Affect Future Results of Operations

We believe that the growth of our business and our future success are dependent upon many factors including those described under “Risk Factors” included elsewhere in our Annual Report. While these factors present significant opportunities for us, they also pose challenges that we must successfully address in order to sustain the growth of our business and enhance our results of operations.

Timely Completion of, and Expansion of Capabilities at, our Existing Data Center Projects.

Our future revenue growth is, in part, dependent on our ability to leverage our development capabilities at our data center sites.

We substantially completed construction of our 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.

Management expects to begin delivering capacity to Nscale during the third quarter and for NC-1 to start generating revenues 30 days after completion. Additionally, during the third quarter we will begin the initial phases of construction for MTL-2 with an expected delivery near the end of the fiscal year. We expect to increase revenue from our existing sites by securing additional allocations of utility power, subject to our receipt of funding and required permits through ongoing engagement with the utility and relevant authorities. In addition, at certain new and existing sites, we intend to deploy natural gas fuel cell generation technology to increase available power and revenue potential. Our ability to secure the required funding and permits in accordance with our implementation plans may cause variability in our revenue growth in future quarters.

Development of Data Center Pipeline.

We intend to rapidly develop additional sites from our expansion pipeline in targeted locations to secure a strategic presence across North America. By developing a robust HPC data center platform across North America, we expect to enhance redundancy, mitigate geo-location risks, and ensure our services are available where clients need them most. We expect our strategically placed WhiteFiber data centers in smaller urban areas will deliver carrier hotel-level connectivity, while our larger deployments will power AI-driven computing super-clusters, driving innovation and efficiency.

Expansion of Cloud Services.

We have made investments in research and development of our cloud service technology and services. Cloud services are highly competitive, rapidly evolving, and require significant investment, including development and operational costs, to meet the changing needs and expectations of our existing users and attract new users. Our ability to deploy certain cloud service technologies critical for our products and services and for our business strategy may depend on the availability and pricing of third-party equipment and technical infrastructure. In the future, we are looking to generate significant revenues from our cloud services, but such revenue growth depends upon certain third-party providers which may be beyond our control and creates uncertainty that we will be able to generate consistent revenue.

On July 9, 2026, the Company 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 the Company has submitted related patent applications. The Company is targeting commercial launch of this solution in the third quarter of 2026, subject to completion of additional full-spectrum fiber testing; there can be no assurance that commercialization will occur on this timeline or at all.

Availability of Additional Financing.

Our ability to fund the continued construction and buildout of our data center facilities and to refinance near-term debt maturities depends on successfully obtaining additional financing on acceptable terms, or at all. If we are unable to do so, our business, operating results, and financial condition could be adversely affected.

In addition to the key factors described above, we may also generate revenue through the monetization of excess or unused power capacity, resale or leasing of high-performance computing (HPC) hardware, licensing of software or infrastructure designs, and strategic partnerships that expand our service offerings. However, these potential revenue streams are at an early stage and are not expected to materially contribute to our near-term results.

Results of operations for the three months ended June 30, 2026 and 2025

The following discussion summarizes the results of operations for the three months ended June 30, 2026 and 2025. This information should be read together with our condensed consolidated financial statements and related notes included elsewhere in this Form 10-Q.

Revenue

We generate revenues primarily from providing cloud services and colocation services. Refer to Note 3. Revenue from Contracts with Customers for further information.

Cloud services revenue is derived from providing customers with access to high-performance computing (“HPC”) infrastructure, including GPU clusters optimized for AI workloads. Our contracts are structured as usage-based or committed-capacity agreements, typically with pricing based on the type and quantity of GPUs deployed, duration of use, and associated infrastructure. Key factors that impact cloud services revenue include the number and performance class of GPUs deployed, hardware utilization, power availability at hosting sites, and the timing of new customer onboarding.

Colocation services revenue is generated from leasing data center space, power, and related infrastructure to customers who operate their own hardware. These contracts are generally multi-year agreements with fixed monthly fees based on committed power capacity (typically measured in kilowatts). Factors that affect colocation revenue include timing of site development and energization, contracted power levels, and customer expansion activity.

Revenue from cloud services

In the fourth quarter of 2023, we established our cloud-based HPC graphics processing units 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 $7.2 million, or 43.5%, to $23.8 million for the three months ended June 30, 2026 from $16.6 million for the three months ended June 30, 2025. The increase was primarily due to an increase in deployed GPU servers to new and existing customers in the second quarter of 2026. The decrease in our monthly GPU service revenue from the termination of our agreement with our Initial Customer was substantially offset by $12.3 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 holds our data center business that provides customers with physical space, power, and cooling within data center facilities.

Our revenue from colocation services was $4.7 million and $1.7 million for the three months ended June 30, 2026 and 2025, respectively. The increase was primarily due to the MTL-3 site becoming fully operational and generating revenues beginning November 2025.

Cost of revenue

We incur cost of revenue from cloud services and colocation services.

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 and (ii) colocation services — electricity costs, lease costs, data center employees’ wage expenses, and other relevant costs.

Cost of revenue — cloud services

For the three months ended June 30, 2026 and 2025, the cost of revenue from cloud services was comprised of the following:

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 June 30, 2026, electricity costs increased by $0.1 million, or 23%, compared to the electricity costs incurred for the three months ended June 30, 2025. The increase primarily resulted from an increase in the number of GPU servers deployed.

Datacenter lease expenses. We entered into data center lease agreements for fixed monthly recurring costs.

For the three months ended June 30, 2026, data center lease expenses increased $0.2 million, or 16%, compared to the three months ended June 30, 2025, primarily due to four new leases that commenced in the first quarter of 2026, as well as an additional lease entered into during the second quarter of 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 June 30, 2026, GPU server lease expenses increased by $1.9 million, or 49%, compared to the GPU servers lease expenses incurred for the three months ended June 30, 2025. The increase primarily resulted from a one-time amount due upon finalizing a termination agreement with a GPU servers leasing partner, 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 three months ended June 30, 2026, third-party customer support fees were $1.3 million.

Cost of revenue — Colocation Services

In the fourth quarter of 2024, we acquired Enovum which provides colocation services. For the three months ended June 30, 2026 and 2025, the cost of revenue from colocation services was comprised of the following:

Electricity costs. These expenses were closely correlated with the number of deployed servers hosted by the data center.

For the three months ended June 30, 2026, electricity costs increased by $0.5 million, or 181%, compared to the electricity costs incurred for the three months ended June 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 June 30, 2026 but not operational during the period ended June 30, 2025.

Lease expenses. These expenses were incurred by the data center for lease agreement for a fixed monthly recurring cost.

For the three months ended June 30, 2026, datacenter lease expenses decreased by $0.1 million, or 55%, compared to the datacenter lease expenses incurred for the three months ended June 30, 2025. The decrease primarily resulted from conclusion of the MTL-3 lease in the second quarter of 2026.

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 June 30, 2026, wage expenses increased slightly compared to the three months ended June 30, 2025 due to additional employees hired following the IPO.

Depreciation and amortization expenses

For the three months ended June 30, 2026 and 2025, depreciation and amortization expenses were $6.6 million and $5.1 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 since June 30, 2025, specifically cloud equipment, resulting in higher expense being recognized.

Impairment of capitalized software assets

For the three months ended June 30, 2026 and 2025, impairment of capitalized software assets were $5.0 million and $nil, respectively, 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 three months ended June 30, 2026.

General and administrative expenses

For the three months ended June 30, 2026, our general and administrative expenses, totaling $14.8 million, were primarily comprised of share-based compensation expenses for employees of $3.4 million, salary and bonus expenses of $3.1 million, professional and consulting expenses of $3.8 million (including $0.3 million of share-based compensation), marketing expenses of $0.6 million, travel expenses of $0.2 million and other expenses of $3.4 million.

For the three months ended June 30, 2025, our general and administrative expenses, totaling $15.5 million, were primarily comprised of shared-based compensation expenses of $6.5 million, salary and bonus expenses of $1.3 million, professional and consulting expenses of $5.7 million, marketing expenses of $0.5 million, travel expenses of $0.2 million and other expenses of $1.3 million.

General and administrative expenses for the three months ended June 30, 2026 were slightly lower than those for the three months ended June 30, 2025, primarily due to lower share-based compensation and lower professional and consulting fees, mainly as a result of reduced consulting fees related to the TSA during the current period. These decreases were partially offset by higher salaries and bonus expense resulting from additional employees hired following the IPO, as well as higher bad debt expense related to the write-off of a portion of the outstanding accounts receivable associated with the termination agreement with a cloud services customer during the current period.

Income tax expenses

Provision for income taxes consists of federal, state and foreign income taxes. Our income tax provision for the six months ended June 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 and Japan. We continue to maintain a valuation allowance against the deferred tax assets in Canada and Japan 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 future effective income tax rate depends on various factors, such as tax legislation, the geographic composition of our pre-tax income, the amount of our pre-tax income as business activities fluctuate, non-deductible expenses, non-taxable capital gain in certain jurisdiction, change of valuation allowance and the effectiveness of our tax planning strategies. The Organisation for Economic Co-operation and Development (“OECD”) has introduced a global minimum tax framework (“Pillar Two”) that generally applies to multinational enterprise groups with consolidated annual revenues of €750 million or more and is intended to ensure a minimum effective tax rate of 15% in each jurisdiction in which such groups operate. Certain jurisdictions have enacted, or are considering enacting, legislation implementing these rules. Based on the Company’s current consolidated revenue, for the six months ended June 30, 2026, the Company is not within the scope of the Pillar Two rules. However, the Company continues to monitor developments related to the implementation of these rules, and future growth or changes in the Company’s operations could result in the Company becoming subject to Pillar Two in future periods.

For more details on the Company’s tax profile, see Note 14. Income Taxes to our condensed consolidated financial statements.

Results of operations for the six months ended June 30, 2026 and 2025

The following discussion summarizes the results of operations for the six months ended June 30, 2026 and 2025.. This information should be read together with our condensed consolidated financial statements and related notes included elsewhere in this Form 10-Q.

Revenue

We generate revenues primarily from providing cloud services and colocation services. Refer to Note 3. Revenue from Contracts with Customers for further information.

Cloud services revenue is derived from providing customers with access to high-performance computing infrastructure, including GPU clusters optimized for AI workloads. Our contracts are structured as usage-based or committed-capacity agreements, typically with pricing based on the type and quantity of GPUs deployed, duration of use, and associated infrastructure. Key factors that impact cloud services revenue include the number and performance class of GPUs deployed, hardware utilization, power availability at hosting sites, and the timing of new customer onboarding.

Colocation services revenue is generated from leasing data center space, power, and related infrastructure to customers who operate their own hardware. These contracts are generally multi-year agreements with fixed monthly or annual fees based on committed power capacity (typically measured in kilowatts). Factors that affect colocation revenue include timing of site development and energization, contracted power levels, and customer expansion activity.

Revenue from cloud services

In the fourth quarter of 2023, we established our cloud-based HPC graphics processing units services, which we term cloud services, a new business line to provide cloud services to support generative AI workstreams. The Company commenced offering cloud services to customers in January 2024.

Our revenue from cloud services increased by $9.1 million, or 29.1%, to $40.6 million for the six months ended June 30, 2026 from $31.4 million for the six months ended June 30, 2025. The increase was primarily due to an increase in deployed GPU servers to existing customers in the first and second quarter of 2026. The decrease in our monthly GPU service revenue from the termination of our agreement with our Initial Customer was substantially offset by $12.3 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 $9.5 million and $3.4 million for the six months ended June 30, 2026 and 2025, respectively. The increase was primarily due to the MTL-3 site becoming fully operational and generating revenues beginning November 2025.

Cost of revenue

We incur cost of revenue from cloud services and colocation services.

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 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 and (ii) colocation services — electricity costs, lease costs, data center employees’ wage expenses, and other relevant costs.

Cost of revenue — cloud services

For the six months ended June 30, 2026 and 2025, the cost of revenue from cloud services was comprised of the following:

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 six months ended June 30, 2026, electricity costs increased by $0.5 million, or 38%, compared to the electricity costs incurred for the six months ended June 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 six months ended June 30, 2026, data center lease expenses increased $0.3 million, or 13%, compared to the six months ended June 30, 2025, primarily due to four new leases that commenced in the first quarter of 2026, as well as an additional lease entered into during the second quarter of 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 six months ended June 30, 2026, GPU server lease expenses increased $1.8 million, or 24%, compared to the GPU server lease expenses incurred for the six months ended June 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 six months ended June 30, 2026, third-party customer support fees were $1.4 million.

Cost of revenue — Colocation Services

In the fourth quarter of 2024, we acquired Enovum which provides colocation services. For the six months ended June 30, 2026 and 2025, the cost of revenue from colocation services was comprised of the following:

Electricity costs. These expenses were closely correlated with the number of deployed servers hosted by the data center.

For the six months ended June 30, 2026, electricity costs increased by $1.1 million, or 222%, compared to the electricity costs incurred for the six months ended June 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 June 30, 2026 but not operational during the period ended June 30, 2025.

Lease expenses. These expenses were incurred by the data center for lease agreement for a fixed monthly recurring cost.

For the six months ended June 30, 2026, datacenter lease expenses increased by $0.2 million, or 75%, compared to the datacenter lease expenses incurred for the six months ended June 30, 2025. The increase primarily resulted from the new MTL-3 lease entered in the second quarter of 2025.

Wage expenses. These expenses represent the salaries and benefits of data center employees involved in the operation of our facilities.

For the six months ended June 30, 2026, wage expenses increased by $0.3 million, or 169%, compared to the six months ended June 30, 2025. The increase was primarily attributable to the operations of MTL-3 site.

Depreciation and amortization expenses

For the six months ended June 30, 2026 and 2025, depreciation and amortization expenses were $13.0 million and $9.0 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 six months ended June 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 six months ended June 30, 2026.

General and administrative expenses

For the six months ended June 30, 2026, our general and administrative expenses, totaling $32.6 million, were primarily comprised of share-based compensation expenses of $8.5 million, salary and bonus expenses of $5.3 million, professional and consulting expenses of $9.9 million (including share-based compensation expenses of $2.4 million), marketing expenses of $1.1 million, commission expenses of $0.1 million, travel expenses of $0.2 million and other expenses of $6.4 million.

For the six months ended June 30, 2025, our general and administrative expenses, totaling $19.8 million, were primarily comprised of share-based compensation expenses of $6.7 million, salary and bonus expenses of $2.5 million, professional and consulting expenses of $7.4 million, marketing expenses of $0.8 million, travel expenses of $0.3 million and other expenses of $2.1 million.

The General and administrative expenses during the six months ended June 30, 2026 were higher compared to the six months ended June 30, 2025 primarily attributable to higher share-based compensation. In addition, salary and bonus expenses increased due to additional employees hired following the IPO. Professional and consulting fees were also higher, reflecting RSUs granted to consultants and consulting costs charged by Bit Digital to WhiteFiber per the TSA agreement. The increase further included start-up costs that do not meet the criteria for capitalization. These increases reflect the Company’s expanded operations and personnel base following the IPO and continued investment in infrastructure and technology development.

Income tax expenses

Provision for income taxes consists of federal, state and foreign income taxes. Our income tax provision for the six months ended June 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 and Japan. We continue to maintain a valuation allowance against the deferred tax assets in Canada and Japan 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 future effective income tax rate depends on various factors, such as tax legislation, the geographic composition of our pre-tax income, the amount of our pre-tax income as business activities fluctuate, non-deductible expenses, non-taxable capital gain in certain jurisdiction, change of valuation allowance and the effectiveness of our tax planning strategies. The Organization for Economic Co-operation and Development (“OECD”) has introduced a global minimum tax framework (“Pillar Two”) that generally applies to multinational enterprise groups with consolidated annual revenues of €750 million or more and is intended to ensure a minimum effective tax rate of 15% in each jurisdiction in which such groups operate. Certain jurisdictions have enacted, or are considering enacting, legislation implementing these rules. Based on the Company’s current consolidated revenue, for the three months ended June 30, 2026, the Company is not within the scope of the Pillar Two rules. However, the Company continues to monitor developments related to the implementation of these rules, and future growth or changes in the Company’s operations could result in the Company becoming subject to Pillar Two in future periods.

For more details on the Company’s tax profile, see Note 14. Income Taxes to our condensed consolidated financial statements.

Discussion of Certain Balance Sheet Items as of June 30, 2026 and December 31, 2025

The following table sets forth selected information from our condensed consolidated balance sheets as of June 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.

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 were $56.1 million and $114.4 million as of June 30, 2026 and December 31, 2025, respectively. The decrease was primarily attributable to $318.6 million of net cash used in investing activities, partially offset by $89.1 million of net cash provided by operating activities and $171.9 million of net cash provided by financing activities, coupled with a $0.3 million unfavorable effect of foreign currency translation.

Restricted cash

Restricted cash represents cash balances that support an outstanding letter of credit to third parties related to security deposits and are restricted from withdrawal. As of June 30, 2026 and December 31, 2025, the fixed maximum amount guaranteed under the letter of credit was $4.3 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 $23.2 million and $23.9 million as of June 30, 2026 and December 31, 2025, respectively. The decrease in the balance of accounts receivable is attributable primarily 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 $8.4 million, respectively as of June 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 lease totaling $1.4 million and $2.3 million of lease payments collected from equipment leasing customers, partially offset by $0.7 million in interest income earned.

Other current assets, net

Other current assets, net were $21.2 million and $21.3 million as of June 30, 2026 and December 31, 2025, respectively. The decrease in the balance of other current assets was mainly attributable to a decrease in prepaid consulting services of $0.9 million, and prepayment to third parties of $0.8 million, partially offset by $1.2 million in receivable from third parties, $0.4 million in funds held in escrow, and $0.2 million in deferred contract costs.

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 June 30, 2026 decreased by $19.3 million, mainly due to the reclassification of property and equipment of $57.8 million offset by prepayment of $38.4 million for 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, 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 June 30, 2026, the Cloud service equipment had a net book value, including CIP, of $95.8 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 June 30, 2026 decreased by $28.2 million, mainly due to the sale of H200 servers with carrying value of $24.3 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 June 30, 2026, the Colocation service equipment had a net book value, including CIP, of $556.3 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 June 30, 2026 increased by $343.7 million, mainly due to $322.5 million of development costs for the construction of NC-1 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 $1.9 million for MTL-1 in Montreal, in part, by an increase in accumulated depreciation of $2.1 million as well as a foreign-exchange impact of $3.5 million.

Operating and finance lease right-of-use assets and lease liabilities

As of June 30, 2026, our operating and finance right-of-use assets and lease liabilities were $16.6 million and $15.4 million, respectively. As of December 31, 2025, the Company’s operating and finance right-of-use assets and lease liabilities were $24.2 million and $23.4 million, respectively.

The decrease in right-of-use assets of $7.6 million was due to the amortization of the right-of-use assets totaling $3.1 million for the six months ended June 30, 2026 and the reduction of $12.6M resulting from the Company’s acquisition of the underlying leased assets under its existing finance lease, which was reclassified to property and equipment, net, partially offset by the addition of $8.3 million for eight operating leases.

The decrease in lease liabilities of $8.0 million was primarily due to the lease payments totaling $16.6 million for the six months ended June 30, 2026, partially offset by the addition of $8.3 million for eight operating leases.

Other non-current assets, net

Other non-current assets, net were $24.1 million as of June 30, 2026, compared to $23.8 million as of December 31, 2025, an increase of $0.3 million. The increase was primarily due to a $0.3 million increase in deferred financing costs, $0.2 million increase in deposits, and $0.8 million increase in prepaid warranty, partially offset by a $1.2 million decrease in deferred contract costs which was reclassified to current.

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 June 30, 2026 and December 31, 2025, the Company recorded goodwill in the amount of $19.4 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 13. Goodwill and Intangible Assets for further information. As of June 30, 2026 and December 31, 2025, the total balance of intangible assets was $12.0 million and $12.8 million, respectively relating to amortization during the period.

Accounts payable

Accounts payable primarily consists of amounts due for costs related to HPC services. Compared with December 31, 2025, the balance of accounts payable increased by $5.2 million in the six months ended June 30, 2026, largely due to a one-time amount due upon finalizing a termination agreement with a GPU servers leasing partner in the quarter, and timing of unpaid bills for our cloud services in the six months ended June 30, 2026.

Deferred revenue

As of June 30, 2026, the Company’s current and non-current portion of deferred revenue was $17.9 million and $125.2 million, respectively, compared to $8.0 million and $71.6 million, respectively, as of December 31, 2025. The increase in deferred revenue of $63.6 million reflects $72.6 million prepayments from customers for cloud services and data center services to be rendered in the future, partially offset by the recognition of $1.4 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 $41.6 million as of June 30, 2026, compared to $48.3 million as of December 31, 2025, a decrease of $6.8 million. The decrease was primarily due to the decrease in payables of $19.4 million which primarily related to the NC-1 facility while the remaining related from unpaid invoices to our vendors in HPC due to the timing of invoicing and cash payments. In addition, there was a decrease relating to bonus payable of $0.9 million. These decreases were partially offset by an increase in deferred share-based compensation liability of $4.7 million, fixed asset payables of $5.1 million, interest payable of $5.6 million, short-term customer deposits of $0.6 million and a write-off in the amount of $1.4 million in commissions payable relating to the termination agreement of one of our customers.

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 six months ended June 30, 2026, including term loan facilities and a Delayed Draw Term Loan Facility (including the related B. Riley Facility) used to finance the Company’s operations.

As of June 30, 2026 and December 31, 2025, the total balance of our short-term and long-term debt, net was $83.2 million and $nil, respectively, with the change attributable to proceeds drawn under the new facilities during the period, net of related debt issuance costs and discounts. Refer to Note 10. Debt, for more information.

Convertible note payable, net

The convertible notes payable relates to the purchase agreement entered into by the Company in connection with the issuance of its 2031 Notes. In January 2026, the Company issued $230.0 million aggregate principal amount of 4.50% convertible senior notes due 2031.

As of June 30, 2026 and December 31, 2025, the carrying amount of the Company’s convertible note payable was $222.6 million and $nil, respectively. Refer to Note 10. Debt, for more information.

Other long-term liabilities

As of June 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 the 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 non-cash expenses such as share-based compensation expenses.

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.

Reconciliations of Adjusted EBITDA to the most comparable U.S. GAAP financial metric for the three months ended and six months ended June 30, 2026 and 2025 are presented in the table below:

Liquidity and capital resources

As of June 30, 2026, our principal sources of liquidity were cash and cash equivalents of $56.1 million, and accounts receivable, net of $23.2 million.

Working capital is the difference between the Company’s current assets and current liabilities. As of June 30, 2026, we had working capital deficit of $28.6 million as compared with working capital of $85.2 million as of December 31, 2025. However, included in current liabilities is $17.9 million of current deferred revenue and $29.3 million of related party short-term debt from Bit Digital.

The working capital deficit was primarily driven by the classification of certain indebtedness as current liabilities due to their contractual maturities within the next twelve months, including amounts outstanding under the indebtedness described below. We intend to repay, extend, or refinance these obligations with longer-term or permanent financing. Furthermore, in assessing our liquidity position, we considered our recent operating performance and cash generation. The Company generated positive adjusted EBITDA of $5.5 million and $8.5 million for the three and six months ended June 30, 2026, respectively. See Non-GAAP Financial Measures for further details. In addition, we generated positive cash flows from operating activities of $89.1 million for the six months ended June 30, 2026. These results demonstrate our ability to generate positive operating cash flows from our existing operations and represent additional factors considered in our assessment of our ability to meet our liquidity needs.

Prior to the Reorganization, as part of Bit Digital, the Company relied on Bit Digital to meet its working capital and financing requirements prior to generating revenue. We had primarily funded our operations through operating cash flows and equity financing provided by Bit Digital via public and private securities offerings of Bit Digital’s ordinary shares.

Following the Reorganization, our capital structure and sources of liquidity changed from our historical capital structure because we are no longer participating in Bit Digital’s cash management process. The Company’s ability to fund its operating needs in the future will depend on the ongoing ability to generate positive cash flow from our operations and raise capital in the capital markets on our own. Based upon our history of generating strong cash flows and our demonstrated ability to secure financing when needed, we believe that we will be able to meet our short-term liquidity needs.

Convertible note

In January 2026, we 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 our liquidity and provides additional capital to fund upcoming development projects, including construction activities and other strategic growth initiatives.

The 2031 Notes bear interest at 4.500% per annum, payable semiannually in arrears on February 1 and August 1 of each year, beginning August 1, 2026, and mature on February 1, 2031, unless earlier converted, redeemed, or repurchased. The Notes increase our long-term indebtedness and will require annual cash interest payments of approximately $10.4 million.

Iceland facility agreement

WhiteFiber Iceland ehf., a subsidiary of the Company, entered into a secured term loan facility with Landsbankinn hf. in March 2026, providing up to $20 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, the Company drew down $18 million under the Facility. As of June 30, 2026, $18 million was outstanding under the Facility, with an effective interest rate of 10.64%, which includes the stated interest rate of 7.92%. The Facility is secured by first-ranking security over (i) 100% of the Company’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.

Royal Bank of Canada credit facility

On July 6, 2026, the Company 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 the Company 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 the Company drew a CORRA loan amount of CAD $36.8 million (approximately $26.2 million) under the Syndicated Credit Facility Agreement.

Delayed Draw Term Loan Facility

On May 20, 2026, Enovum NC-1 Venture, LLC, a subsidiary of the Company, entered into a Delayed Draw Term Loan Facility and Security Agreement with Bit Digital Capital, Inc., a subsidiary of Bit Digital, providing up to $100 million of available borrowings (which may be increased to $150 million), to support near-term growth initiatives in both its data centers and cloud services businesses. The facility is guaranteed by WhiteFiber Operating Partnership, LP and is secured by a first-ranking security interest over 100% of the Company’s shareholding in Enovum NC-1 Topco, Inc., subject to a collateral step-down upon the Borrower obtaining permanent financing for NC-1.

The Delayed Draw Term Loan Facility bears interest at an initial rate of 9.5% per annum, subject to a step-down upon completion of certain development and leasing milestones at the NC-1 facility, and includes a MOIC Amount payable at maturity. On May 26, 2026, the Company drew down $50.0 million in two tranches ($20.0 million and $30.0 million) at an original issue discount of 3%, with each tranche maturing in 90 days (extendable by 30 days by mutual agreement). Concurrent with funding, the $20.0 million tranche was assigned by Bit Digital to B. Riley Securities, Inc. (see “B. Riley Facility” below), leaving $30.0 million outstanding under the Delayed Draw Term Loan Facility. As of June 30, 2026, the Delayed Draw Term Loan Facility had a net carrying value of $29.3 million and an effective interest rate of 50.6%, which exceeded the contractual rate due to the inclusion of the MOIC payment and the facility’s short-term nature. Subsequent to quarter end, on July 27, 2026 and July 31, 2026, the Company drew down an additional $20.0 million and $10.0 million, respectively, each with a 180-day maturity, extendable by mutual agreement of the parties. The Delayed Draw Term Loan Facility provides the Company with near-term capital while it pursues longer-term permanent financing.

B. Riley Facility

On May 26, 2026, Bit Digital assigned to B. Riley Securities, Inc. a $20.0 million note originally issued to Enovum NC-1 Venture, LLC under the Delayed Draw Term Loan Facility described above. As of June 30, 2026, the B. Riley Facility had a net carrying value of $19.4 million and an effective interest rate of 50.6%, which, consistent with the Delayed Draw Term Loan Facility, exceeded the contractual rate due to the MOIC payment and the facility’s short-term nature. Together, the Delayed Draw Term Loan Facility and B. Riley Facility provide the Company with additional short-term capital to support ongoing development activities.

NC-1 Project Financing Update

The Company has entered into exclusivity with a consortium of lenders in connection with a proposed secured financing for its NC-1 project. The parties have commenced diligence and are negotiating definitive documentation, and are working toward closing, subject to customary approvals and conditions. There can be no assurance that the financing will be completed on favorable terms or at all. If completed, we expect the financing would return a significant portion of our invested capital to the balance sheet for redeployment into future development.

Our development pipeline is capital intensive, and depending on construction costs, leasing pace, and financing market conditions, our existing capital resources may not be sufficient to fund both this pipeline and our near-term debt maturities without accessing additional capital, whether through indebtedness, equity or equity-linked securities, project-level financing, or otherwise. Our future capital requirements will depend on many factors, including our ability to refinance or extend near-term debt maturities described above, the revenue growth rate, the success of future product development and capital investment required, and the timing and extent of spending to support further sales and marketing and research and development efforts. In addition, we expect to incur additional costs as a result of operating as a public company. In the event that additional financing is required from outside sources, we cannot be sure that any additional financing will be available to us on acceptable terms if at all. If we are unable to raise additional capital when desired, our business, operating results, and financial condition could be adversely affected.

Cash flows

Operating Activity

Net cash provided by operating activities was $89.1 million for the six months ended June 30, 2026, derived mainly from (i) a net loss of $27.0 million for the six months ended June 30, 2026 adjusted for depreciation and amortization expenses of property and equipment of $13.0 million, amortization of discount on convertible note issued of $0.5 million, amortization of discount on our third party and related party debt of $0.8 million, share-based compensation of $11.0 million, impairment of capitalized software assets of $5.0 million, gain from disposal of property, plant, and equipment of $1.8 million, and current expected credit losses of $2.2 million and a (ii) net changes in our operating assets and liabilities, principally comprising of an increase to other assets of $0.3 million, a decrease in right-of-use assets of $2.8 million, an increase in deferred revenue of $63.6 million, a decrease in lease liabilities of $3.1 million, an increase in accounts receivable of $1.6 million, a decrease in net investment in lease of $2.0 million, an increase in accounts payable of $5.3 million, an increase of income tax payable of $0.3 million, an increase in other payables and accrued liabilities of $6.3 million, an increase of other long-term liabilities of $6.3 million, a decrease in deferred tax liabilities of $0.7 million, and an increase in amounts due to related parties of $4.6 million.

Net cash used in operating activities was $6.8 million for the six months ended June 30, 2025, derived mainly from (i) a net loss of $7.4 million for the six months ended June 30, 2025 adjusted for depreciation expenses of property and equipment of $9.0 million and (ii) net changes in our operating assets and liabilities, principally comprising of a decrease in deferred revenue of $19.0 million, a decrease in other current assets of $3.3 million, an increase in accounts receivable of $1.2 million, a decrease in accounts payable of $1.1 million, a decrease in other long-term liabilities of $0.4 million, an increase in other payables and accrued liabilities of $8.5 million, a decrease in net investment in lease of $1.3 million, a decrease in lease liability of $2.2 million, and an increase in deferred tax liability of $1.0 million.

Investing Activity

Net cash used in investing activity was $318.6 million for the six months ended June 30, 2026, attributable to purchases of and deposits made for property, plant, and equipment of $344.7 million, partially offset by proceeds from disposal of property, plant and equipment of $26.1 million.

Net cash used in investing activity was $131.0 million for the six months ended June 30, 2025, attributable to purchases of and deposits made for property, plant, and equipment of $131.0 million.

Financing Activity

Net cash provided by financing activity was $171.9 million for the six months ended June 30, 2026, attributable to net proceeds from issuance of convertible debt of $222.1 million, net proceeds from issuance of debt – third parties of $53.3 million, net proceeds from issuance of debt – related parties of $29.1 million, partially offset by purchase of zero-strike call option of $120.0 million, and repayment of finance lease liabilities of $12.6 million.

Net cash provided by financing activity was $142.7 million for the six months ended June 30, 2025, attributable to net transfers from parent of $142.7 million.

Off-Balance Sheet Arrangements

During the periods presented, we did not have any off-balance sheet arrangements.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements. These financial statements are prepared in accordance with U.S. GAAP, which requires the Company to make estimates and assumptions that affect the reported amounts of our assets, liabilities, revenues, and expenses, to disclose contingent assets and liabilities on the dates of the condensed consolidated financial statements, and to disclose the reported amounts of revenues and expenses incurred during the financial reporting periods. The most significant estimates and assumptions include, but are not limited to, the valuation of 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 and realization of deferred tax assets. We continue to evaluate these estimates and assumptions that we believe to be reasonable under the circumstances. We rely on these evaluations as the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Since the use of estimates is an integral component of the financial reporting process, actual results could differ from those estimates as a result of changes in our estimates. Some of our accounting policies require higher degrees of judgment than others in their application. We believe critical accounting policies as disclosed in this release reflect the more significant judgments and estimates used in preparation of our condensed consolidated financial statements. For a summary of significant accounting policies, refer to Note 2. Summary of Significant Accounting Policies in our Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere herein.

Recently Issued Accounting Pronouncements

There have been no recently issued accounting pronouncements that have had, or are expected to have, a material impact on our results of operations, financial position and/or cash flows.

Emerging Growth Company Status

We are an “emerging growth company,” as defined in the JOBS Act, enacted in April 2012. We intend to take advantage of certain exemptions under the JOBS Act from various public company reporting requirements, including not being required to have our internal control over financial reporting audited by our independent registered public accounting firm pursuant to Section 404(b) of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and any golden parachute payments not previously approved. In addition, an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This provision allows an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to avail ourselves of this provision of the JOBS Act. As a result, we will not be subject to new or revised accounting standards at the same time as other public companies that are not emerging growth companies. Therefore, our consolidated financial statements may not be comparable to those of companies that comply with new or revised accounting pronouncements as of public company effective dates.

We will remain an emerging growth company and may take advantage of these exemptions until the earliest of: (i) the last day of the fiscal year following the fifth anniversary of the consummation of our IPO; (ii) the last day of the fiscal year in which we have total annual gross revenue of at least $1.235 billion; (iii) the last day of the fiscal year in which we are deemed to be a “large accelerated filer” as defined in Rule 12b-2 under the Securities and Exchange Act of 1934, as amended (the “Exchange Act”) which would occur if the market value of our Ordinary Shares held by non-affiliates exceeded $700.0 million as of the last business day of the second fiscal quarter of such year; or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Not applicable. A smaller reporting company is not required to provide the information required by this Item.

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 Form 10-Q.

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 six months ended June 30, 2026 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time, we may become involved in various disputes and litigation matters that arise in the ordinary course of business. We are not presently a party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or taken together have a material adverse effect on our business, results of operations, cash flows or financial condition. For more information, refer to Note 18. Commitments and Contingencies in our Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere herein.

Item 1A. Risk Factors

In addition to the information set forth in this Quarterly Report on Form 10-Q, including the information set forth in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” as well as in our condensed consolidated financial statements and the related notes, you should carefully consider the risk factors disclosed in the section entitled “Risk Factors” in our Annual Report and the other reports that we have filed with the SEC. Any of the risks discussed in such reports, as well as additional risks and uncertainties not currently known to us or that we currently deem immaterial, could materially and adversely affect our results of operations, financial condition or prospects. During the period covered by this Quarterly Report on Form 10-Q, there have been no material changes in our risk factors as previously disclosed:

Item 2. Unregistered Sales of Equity Securities. Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Recent Sales of Unregistered Securities

On January 26, 2026, we completed a private offering of $230.0 million aggregate principal amount of 4.500% Convertible Senior Notes due 2031 (the “2031 Notes”), including the exercise in full of the initial purchasers’ option to purchase an additional $20.0 million aggregate principal amount of 2031 Notes. The 2031 Notes are general senior unsecured obligations of the Company. The 2031 Notes were issued pursuant to an Indenture, dated January 26, 2026 (the “Indenture”), between the Company and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”). The 2031 Notes will mature on February 1, 2031 (the “Maturity Date”), unless earlier converted, redeemed or repurchased. The 2031 Notes will bear interest at a rate of 4.500% per year, payable semiannually in arrears on February 1 and August 1 of each year, beginning on August 1, 2026. Holders 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, the Company 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 the Company’s election, in the manner and subject to the terms and conditions set forth in the Indenture. The conversion rate is initially 38.5981 ordinary shares per $1 thousand principal amount of the 2031 Notes (equivalent to an initial conversion price of approximately $25.91 per ordinary share), which represents an approximately 27.5% conversion premium over the last reported sale price of $20.32 per ordinary share on the Nasdaq Capital Market on January 21, 2026. The conversion rate is subject to customary adjustments upon the occurrence of certain events, as described in the Indenture.

On February 6, 2029, and if the Company undergoes a “Fundamental Change” (as defined in the Indenture), then, subject to certain conditions and except as set forth in the Indenture, noteholders may require the Company to repurchase for cash all or any portion of their 2031 Notes at a repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the relevant repurchase date.

The Company may not redeem the 2031 Notes prior to February 6, 2029. The Company may redeem for cash all or any portion of the 2031 Notes, at our option, on or after February 6, 2029 and prior to the 41st scheduled trading day immediately preceding the maturity date, if the last reported sale price of our ordinary shares has been at least 130% of the conversion price for the 2031 Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of optional redemption. However, the Company may not redeem less than all of the outstanding 2031 Notes at its option unless at least $75.0 million aggregate principal amount of 2031 Notes are outstanding and not called for optional redemption as of the time it sends the related notice of optional redemption (and after giving effect to the delivery of such notice of optional redemption). The Company may also redeem for cash, in whole but not in part, the 2031 Notes, subject to certain conditions, upon the occurrence of certain changes to the laws, rules or regulations of a relevant taxing jurisdiction (as defined in the Indenture). The redemption price is equal to 100% of the principal amount of the 2031 Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date.

In connection with the issuance of the 2031 Notes, the Company entered into a privately negotiated zero-strike call option transaction with Barclays Bank PLC, through its agent Barclays Capital Inc. (the “Option Counterparty” and, such transaction, the “Call Option Transaction”), with an expiration date that is scheduled to occur shortly after the Maturity Date. Pursuant to the Call Option Transaction, the Company paid a premium equal to approximately $120.0 million for the right to receive, without further payment, 5,905,511 Ordinary Shares (subject to customary adjustment), with delivery thereof by the Option Counterparty at expiry, subject to early settlement of the Call Option Transaction in whole or in part at the Option Counterparty’s discretion.

The net proceeds from the sale of the 2031 Notes were approximately $222.1 million, after deducting the initial purchasers’ discounts and offering expenses payable by the Company. The Company used approximately $120.0 million of the net proceeds from the 2031 Notes to pay the cost of the Call Option Transaction. The remaining net proceeds are expected to be used primarily for data center expansion, including to partially fund the lease or purchase of additional property or properties on which to build additional WhiteFiber data centers, to construct those facilities, to enter into additional energy service agreements for each additional site, to purchase related equipment, and for potential acquisitions, partnerships and joint ventures related thereto, and for working capital and general corporate purposes.

The Company offered and sold the Notes to the initial purchasers in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and the Notes were initially resold by the initial purchasers to persons whom the initial purchasers reasonably believed to be qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A under the Securities Act. The Company relied on these exemptions from registration based in part on representations made by the initial purchasers in purchase agreement, dated January 21, 2026, by and among the Company and the representatives of the initial purchasers named therein. The Notes and the Ordinary Shares issuable upon conversion of the Notes, if any, have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. To the extent that any Ordinary Shares are issued upon conversion of the Notes, they will be issued in transactions anticipated to be exempt from registration under the Securities Act by virtue of Section 3(a)(9) thereof, because no commission or other remuneration is expected to be paid in connection with conversion of the Notes, and any resulting issuance of Ordinary Shares. Initially, a maximum of 11,318,898 Ordinary Shares may be issued upon conversion of the Notes based on the initial maximum conversion rate of 49.2126 Ordinary Shares per $1,000 principal amount of the Notes, which is subject to customary anti-dilution adjustment provisions.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

10b5-1 Trading Arrangements

During the six months ended June 30, 2026, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K, nor did the Company during such fiscal quarter adopt or terminate any “Rule 10b5-1 trading arrangement”.

Syndicated RBC Credit Facility Agreement executed on July 6, 2026

On July 6, 2026, the Company’s wholly-owned subsidiary, Enovum Data Center Corp. entered into a syndicated credit agreement (“Syndicated RBC Credit Facility 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 the Company 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.

Borrowings under the Syndicated Credit Facility Agreement bear interest, at the Company’s option, at either (i) CORRA-based benchmark rate for such interest period plus 2.45% per annum plus the credit spread adjustment for the applicable interest period (29.547 basis points for one month interest period, 32.138 basis points for a three month interest period and 0 for a daily interest period), or (ii) RBC Prime rate plus 1.00% per annum. The facility has a three-year term from the date of the initial drawdown and requires interest-only payments until the first full quarter after the date of the initial drawdown. The loan will be amortized through quarterly principal repayments based on a 15-year amortization schedule, with the outstanding principal due in full at maturity. The specific borrowing terms are established at the time of each drawdown pursuant to a borrowing request submitted by the Company and accepted by the lender.

The Syndicated 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.

On July 15, 2026, the Company drew a CORRA loan amount of CAD $36.8 million (approximately $26.2 million) under the Syndicated Credit Facility Agreement.

Item 6. Exhibits.

(a) Exhibits.

† Certain identified information has been excluded from this exhibit, because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.

* Filed herewith (unless otherwise noted as being furnished herewith).

** 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.