What changed in this filing

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Item 1. Financial Statements

2025-08-15 compared with 2025-05-20 · 772 added, 410 removed, 913 unchanged (56% of the section changed)

24 unchanged sentences

Notes payable, related party, current

Convertible notes payable, current

Convertible notes payable

Guarantee liability

12 unchanged sentences

Preferred stock, $ 0.001 par value - 25,000,000 shares authorized;

2,160,267 and 2,029,450 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively (liquidation preference of $ 79,630,000 as of March 31, 2025)

2,294,869 and 2,029,450 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively (liquidation preference of $ 85,706,000 as of June 30, 2025)

Class A Common Stock, $ 0.001 par value – 500,000,000 shares authorized;

1,429,995 and 1,259,893 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively

8,666,055 and 1,259,893 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively

Class B Common Stock, $ 0.001 par value – 25,000,000 shares authorized;

4,995,724 and 4,998,597 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively

4,993,751 and 4,998,597 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively

Additional paid-in capital

18 unchanged sentences

AND COMPREHENSIVE LOSS

For the Three Months Ended March 31,

For the Three Months Ended

For the Six Months Ended June 30,

Revenue, crane operations

2 unchanged sentences

Revenue, lending and trading activities

( 9,763,000 )

Revenue, other

3 unchanged sentences

Cost of revenue, hotel and real estate operations

Cost of revenue, lending and trading activities

Cost of revenue, other

Total cost of revenue

Gross profit (loss)

( 3,788,000 )

Operating expenses

2 unchanged sentences

General and administrative

Impairment of property and equipment

Total operating expenses

(Loss) income from operations

Loss from operations

( 10,127,000 )

( 26,930,000 )

( 16,511,000 )

( 23,273,000 )

Other income (expense):

3 unchanged sentences

( 5,319,000 )

( 11,503,000 )

( 10,950,000 )

Gain on conversion of investment in equity securities to marketable equity securities

2 unchanged sentences

Loss from investment in unconsolidated entity

Gain on deconsolidation of subsidiary

( 1,291,000 )

( 1,958,000 )

Impairment of equity securities

( 6,266,000 )

(Loss) gain on deconsolidation of subsidiary

Provision for loan losses, related party

2 unchanged sentences

Total other expense, net

(Loss) income before income taxes

( 7,340,000 )

Income tax provision (benefit)

Net (loss) income from continuing operations

( 12,855,000 )

Net loss from discontinued operations

( 5,620,000 )

Net (loss) income

( 2,325,000 )

Net loss (income) attributable to non-controlling interest

Loss before income taxes

( 17,467,000 )

Net (loss) income attributable to Hyperscale Data, Inc.

( 39,785,000 )

( 22,131,000 )

( 25,598,000 )

Income tax benefit

Net loss from continuing operations

( 17,338,000 )

( 39,781,000 )

( 22,061,000 )

( 25,593,000 )

Net income (loss) from discontinued operations

( 2,996,000 )

( 17,338,000 )

( 39,441,000 )

( 22,061,000 )

( 28,589,000 )

Net (income) loss attributable to non-controlling interest

( 1,713,000 )

( 1,195,000 )

( 1,621,000 )

Net loss attributable to Hyperscale Data, Inc.

( 19,051,000 )

( 33,927,000 )

( 23,256,000 )

( 30,210,000 )

Preferred dividends

1 unchanged sentence

( 1,308,000 )

Net (loss) income available to common stockholders

( 4,181,000 )

Basic net (loss) income per common share:

Continuing operations

Discontinued operations

Net (loss) income per common share

Diluted net (loss) income per common share:

( 2,568,000 )

Net loss available to common stockholders

$ ( 21,266,000 )

$ ( 35,235,000 )

$ ( 27,437,000 )

$ ( 32,778,000 )

Basic and diluted net (loss) income per common share:

Continuing operations

Discontinued operations

Net (loss) income per common share

Weighted average common shares outstanding:

Comprehensive (loss) income

Net (loss) income available to common stockholders

Net loss per common share

Weighted average basic and diluted common shares outstanding

Comprehensive loss

Net loss available to common stockholders

$ ( 21,266,000 )

$ ( 35,235,000 )

$ ( 27,437,000 )

$ ( 32,778,000 )

Foreign currency translation adjustment

Other comprehensive income

Total comprehensive (loss) income

Other comprehensive (loss) income

Total comprehensive loss

$ ( 21,266,000 )

$ ( 35,423,000 )

$ ( 27,431,000 )

$ ( 32,903,000 )

The accompanying notes are an integral part of

4 unchanged sentences

IN STOCKHOLDERS’ EQUITY

Three Months Ended March 31, 2025

Three Months Ended June 30, 2025

Preferred Stock

Class A Common

2 unchanged sentences

Stockholders’

BALANCES, April 1, 2025

$ 672,082,000

$ ( 665,692,000 )

Issuance of Series G preferred stock, related party

Fair value of warrants issued in connection with Series G

preferred stock, related party

Issuance of Series B preferred stock for cash

Issuance of Series D preferred stock for cash

Class B common stock converted into Class A common stock

Stock-based compensation

Issuance of Class A common stock for conversion of debt

Net loss attributable to Hyperscale Data

( 19,051,000 )

Series A preferred dividends ($1.25 per share)

Series B preferred dividends ($13.13 per share)

Series C preferred dividends ($47.25 per share)

( 1,184,000 )

Series D preferred dividends ($1.88 per share)

Series E preferred dividends ($1.40 per share)

Series G preferred dividends ($7.81 per share)

Conversion of Series B preferred stock to common stock

Net income attributable to non-controlling interest

Deconsolidation of subsidiary

BALANCES, June 30, 2025

$ 692,584,000

$ ( 686,958,000 )

$ ( 131,000 )

The accompanying notes are an integral part of

these unaudited condensed consolidated financial statements.

HYPERSCALE DATA, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES

IN STOCKHOLDERS’ EQUITY

Three Months Ended June 30, 2024

Preferred Stock

Class A Common

Comprehensive

Stockholders’

BALANCES, April 1, 2024

$ 656,616,000

$ ( 565,035,000 )

$ ( 2,061,000 )

$ ( 30,571,000 )

Issuance of Series C preferred stock, related party for cash

Fair value of warrants issued in connection with Series C preferred stock, related

Stock-based compensation

Issuance of Class A common stock for conversion of debt

Increase in ownership interest of subsidiary

Sale of subsidiary stock to non-controlling interests

Distribution to Circle 8 Crane Services, LLC (“Circle

8”) non-controlling interest

Net loss attributable to Hyperscale Data

( 33,927,000 )

Series A preferred dividends ($0.71 per share)

Series C preferred dividends ($23.63 per share)

( 1,040,000 )

Series D preferred dividends ($0.81 per share)

Foreign currency translation adjustments

Net loss attributable to non-controlling interest

( 5,514,000 )

Net loss attributable to non-controlling interest of deconsolidated subsidiary

BALANCES, June 30, 2024

$ 660,071,000

$ ( 600,282,000 )

$ ( 2,497,000 )

$ ( 440,000 )

$ ( 30,571,000 )

The accompanying notes are an integral part of

these unaudited condensed consolidated financial statements.

HYPERSCALE DATA, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES

IN STOCKHOLDERS’ EQUITY

Six Months Ended June 30, 2025

Preferred Stock

Class A Common

Comprehensive

Stockholders’

BALANCES, January 1, 2025

5 unchanged sentences

Issuance of Series G preferred stock, related party

Fair value of warrants issued in connection with Series

G preferred stock, related party

Fair value of warrants issued in connection with Series G preferred stock, related

Issuance of Series B preferred stock for cash

Issuance of Series D preferred stock for cash

Class B common stock dividend

Class B common stock converted into Class A common stock

Stock-based compensation

Issuance of Class A common stock for conversion of

Issuance of Class A common stock for conversion of debt

Net loss attributable to Hyperscale Data

2 unchanged sentences

Series A preferred dividends ($1.25 per share)

Series B preferred dividends ($13.13 per share)

Series C preferred dividends ($47.25 per share)

3 unchanged sentences

Series E preferred dividends ($1.40 per share)

Series G preferred dividends ($7.81 per share)

Conversion of Series B preferred stock to common stock

Retirement of treasury stock

1 unchanged sentence

Foreign currency translation adjustments

Net loss attributable to non-controlling interest

Net income attributable to non-controlling interest

Deconsolidation of subsidiary

BALANCES, March 31, 2025

BALANCES, June 30, 2025

$ 692,584,000

$ ( 686,958,000 )

$ ( 131,000 )

The accompanying notes are an integral part of

4 unchanged sentences

IN STOCKHOLDERS’ EQUITY

Three Months Ended March 31, 2024

A Common Stock

Six Months Ended June 30, 2024

Preferred Stock

Class A Common Stock

Comprehensive

Non-Controlling

Stockholders’

5 unchanged sentences

Issuance of Series C preferred stock, related party for cash

Fair value of warrants issued in connection with Series C preferred stock,

related party

Fair value of warrants issued in connection with Series C preferred stock, related party

Stock-based compensation

1 unchanged sentence

Financing cost in connection with sales of Class A common stock

Issuance of Class A common stock for conversion of debt

Increase in ownership interest of subsidiary

Sale of subsidiary stock to non-controlling interests

Distribution to Circle 8 Crane Services, LLC (“Circle 8”) non-controlling

Distribution to Circle 8 non-controlling interest

Conversion of RiskOn International, Inc.

(“ROI”) convertible

Net income attributable to Hyperscale Data

Net loss attributable to Hyperscale Data

( 30,210,000 )

Series A preferred dividends ($1.28 per share)

Series C preferred dividends ($47.17 per share)

( 2,032,000 )

Series D preferred dividends ($1.62 per share)

2 unchanged sentences

Distribution of securities of TurnOnGreen, Inc.

(“TurnOnGreen”)

to Hyperscale Data Class A common stockholders ($5.70 per share)

(“TurnOnGreen”) to Hyperscale Data Class A common stockholders ($2.02 per share)

( 4,900,000 )

Distribution of ROI investment in White River Energy Corp.

River”) to ROI stockholders

(“White River”) to ROI stockholders

( 19,210,000 )

1 unchanged sentence

Net loss attributable to non-controlling interest of deconsolidated subsidiary

BALANCES, March 31, 2024

( 1,229,000 )

BALANCES, June 30, 2024

$ 660,071,000

$ ( 600,282,000 )

$ ( 2,497,000 )

$ ( 440,000 )

$ ( 30,571,000 )

The accompanying notes are an integral part of

3 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Three Months Ended March 31,

For the Six Months Ended June 30,

Cash flows from operating activities:

Net (loss) income

$ ( 22,061,000 )

$ ( 28,589,000 )

Net loss from discontinued operations

( 2,996,000 )

Net (loss) income from continuing operations

Net loss from continuing operations

( 22,061,000 )

Adjustments to reconcile net (loss) income to net cash used in operating activities:

( 25,593,000 )

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

2 unchanged sentences

Stock-based compensation

Losses (gains) on the sale of fixed assets

Realized losses (gains) on the sale of crypto assets

Change in fair value of crypto assets

Loss (gain) on the sale of fixed assets

Impairment of property and equipment

Impairment of equity securities

Revenue, crypto assets mining

2 unchanged sentences

Proceeds from the sale of crypto assets

Realized gains on sale of marketable securities

Gain on conversion of investment in equity securities to marketable equity securities

( 17,900,000 )

Unrealized losses (gains) on marketable securities

Proceeds from the sale of investment in equity securities

Gain on the sale of equity securities

( 1,401,000 )

Unrealized losses (gains) on investments in common stock, related parties

Income from cash held in trust

Loss from investment in unconsolidated entity

Provision for loan losses

Loss (gain) on extinguishment of debt

( 1,405,000 )

Gain on extinguishment of debt

Gain on deconsolidation of subsidiary

13 unchanged sentences

Net cash used in operating activities from discontinued operations

( 3,826,000 )

Net cash used in operating activities

7 unchanged sentences

Investments in loans receivable

( 1,350,000 )

Investments in non-marketable equity securities

1 unchanged sentence

Investment in notes receivable, related party

Payments (proceeds) from notes receivable, related party

Principal payments on loans receivable

Payments (disbursements) from notes receivable, related party

( 1,841,000 )

6 unchanged sentences

( 3,794,000 )

The accompanying notes are an integral part of

these unaudited condensed consolidated financial statements.

HYPERSCALE DATA, INC.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Three Months Ended March 31,

For the Six Months Ended June 30,

Cash flows from financing activities:

1 unchanged sentence

Financing cost in connection with sales of Class A common stock

Proceeds from sales of Series B preferred stock

Proceeds from sales of Series D preferred stock

Proceeds from sales of Series G preferred stock and warrants, related party

Proceeds from sales of Series C and Series G preferred stock and warrants, related party

Proceeds from subsidiaries’ sale of stock to non-controlling interests

5 unchanged sentences

Payments on convertible notes payable, related party

Proceeds (payments) on notes payable, related party

Payments on notes payable, related party

( 1,898,000 )

6 unchanged sentences

Net cash provided by financing activities from continuing operations

Net cash used in financing activities from discontinued operations

Net cash provided by financing activities from discontinued operations

Net cash provided by financing activities

Effect of exchange rate changes on cash and cash equivalents from continuing operations

Net (decrease) increase in cash and cash equivalents and restricted cash

Net increase in cash and cash equivalents and restricted cash

Cash and cash equivalents and restricted cash at beginning of period - continuing operations

13 unchanged sentences

Conversion of convertible notes payable into shares of Class A common stock

Conversion of Series B preferred stock into shares of Class A common stock

Conversion of debt and equity securities to marketable securities

5 unchanged sentences

Redeemable non-controlling interests in equity of subsidiaries paid with cash and marketable securities held in trust account

Paid-in-kind dividends settled through issuance of Series B preferred stock

Dividend paid in TurnOnGreen common stock in additional paid-in capital

The accompanying notes are an integral part of

these unaudited condensed consolidated financial statements.

DESCRIPTION OF BUSINESS

Hyperscale Data, Inc., a Delaware

corporation (“Hyperscale Data” or the “Company”) is a diversified holding company pursuing growth by acquiring

and developing undervalued businesses and disruptive technologies with a global impact.

Through its wholly and majority-owned subsidiaries

and strategic investments, the Company owns and/or operates data centers at which it mines Bitcoin and offers colocation and hosting services

for the emerging artificial intelligence (“AI”) ecosystems and other industries, and provides products and services that support

a diverse range of industries, including crane rental services, hotel operations, defense, industrial, an AI software platform and a social

gaming platform.

In addition, the Company extends credit to select entrepreneurial businesses through a licensed lending subsidiary.

Hyperscale Data, Inc.

Delaware corporation (“Hyperscale Data” or the “Company”).

Through its wholly owned subsidiary Sentinum, Inc.,

Hyperscale Data owns and operates a data center at which it mines digital assets and offers colocation and hosting services for the emerging

artificial intelligence (“AI”) ecosystems and other industries.

Hyperscale Data’s other wholly owned subsidiary, Ault

Capital Group, Inc.

(“ACG”), is a diversified holding company pursuing growth by acquiring undervalued businesses and disruptive

technologies, including an AI software platform, social gaming platform, equipment rental services, defense/aerospace, industrial, automotive

and hotel operations.

In addition, ACG is actively engaged in providing private credit and structured finance through a licensed lending

The Company has the following

reportable segments:

• Energy and Infrastructure (“Energy”)

– crane operations;

• Technology and Finance (“Fintech”)

– commercial lending, activist investing, and stock trading;

• Energy and Infrastructure (“Energy”) – crane operations;

• Technology and Finance (“Fintech”) – commercial lending, activist investing, and stock

• Sentinum, Inc.

(“Sentinum”) –

crypto assets mining operations and colocation and hosting services for the emerging artificial intelligence ecosystems and other industries;

(“Sentinum”) – crypto assets mining operations and colocation and hosting

services for the emerging artificial intelligence ecosystems and other industries;

• TurnOnGreen – commercial electronics solutions;

• ROI – AI software platform and a social

gaming platform;

• ROI – AI software platform and a social gaming platform;

• Ault Global Real Estate Equities, Inc.

– hotel operations and other commercial real estate holdings.

(“AGREE”) – hotel operations and other commercial

real estate holdings.

LIQUIDITY AND FINANCIAL

of March 31, 2025, the Company had cash and cash equivalents of $ 4.2 million (excluding restricted cash of $ 20.4 million), negative

working capital of $ 149.1 million and a history of net operating losses.

The Company has financed its operations principally through

issuances of convertible debt, promissory notes and equity securities.

These factors create substantial doubt about the Company’s

ability to continue as a going concern for at least one year after the date that these condensed consolidated financial statements are

of June 30 , 2025, the Company had cash and cash equivalents of $ 5.9 million (excluding restricted

cash of $ 21.3 million), negative working capital of $ 139.4 million and a history of net operating losses.

The Company has financed

its operations principally through issuances of convertible debt, promissory notes and equity securities.

These factors create

substantial doubt about the Company’s ability to continue as a going concern for at least one year after the date that these condensed

consolidated financial statements are issued.

The condensed consolidated

financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

the condensed consolidated financial statements have been prepared based on the assumption that the Company will continue as a going concern

and that contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

the condensed consolidated financial statements have been prepared based on the assumption that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

In making this assessment

5 unchanged sentences

Management expects that the

Company’s existing cash and cash equivalents, accounts receivable and marketable securities as of March 31, 2025, will not be sufficient

Company’s existing cash and cash equivalents, accounts receivable and marketable securities as of June 30, 2025, will not be sufficient

to enable the Company to fund its anticipated level of operations through one year from the date these financial statements are issued.

1 unchanged sentence

and selling its crypto assets, or a combination thereof.

Although management believes that such capital sources will be available, there

Although management believes that such capital resources will be available, there

can be no assurances that financing will be available to the Company when needed in order to allow the Company to continue its operations,

1 unchanged sentence

If the Company does not raise sufficient capital in a timely manner, among other

things, the Company may be forced to curtail or cease its operations altogether.

things, the Company may be forced to delay, curtail or cease its operations altogether.

OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

9 unchanged sentences

condensed consolidated financial statements should be read in conjunction with the consolidated financial statements in the Company’s

Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”) as amended, filed with the Securities

and Exchange Commission (the “SEC”) on April 15, 2025.

The condensed consolidated balance sheet as of December 31, 2024

was derived from the Company’s audited 2024 financial statements contained in the above referenced 2024 Annual Report.

the three months ended March 31, 2025, are not necessarily indicative of the results to be expected for the full year ending December 31,

Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”), filed with the Securities and

Exchange Commission (the “SEC”) on April 15, 2025.

The condensed consolidated balance sheet as of December 31, 2024 was

derived from the Company’s audited 2024 financial statements contained in the above referenced 2024 Annual Report.

Results of the

three and six months ended June 30 , 2025, are not necessarily indicative of the results to

be expected for the full year ending December 31, 2025.

Period Revision - Statement of Cash Flows

the three months ended March 31, 2025, the Company disclosed the borrowings of lines of credit and repayments of lines of credit as separate

line items within notes payable activity of the financing activities section of the consolidated statement of cash flows.

has corrected these line items for the three months ended March 31, 2024 for comparability purposes.

the six months ended June 30 , 2025, the Company disclosed the borrowings of lines of credit

and repayments of lines of credit as separate line items within notes payable activity of the financing activities section of the consolidated

statement of cash flows.

The Company has corrected these line items for the six months ended June 30 ,

2024 for comparability purposes.

Significant Accounting

3 unchanged sentences

including the discontinued operations presentation of Gresham Worldwide, Inc.

(“GIGA”) and AGREE financial results.

reclassifications had no effect on previously reported results of operations.

These reclassifications had no effect

on previously reported results of operations.

Recent Accounting Pronouncements

29 unchanged sentences

Deconsolidation of Avalanche International

March 28, 2025, AVLP, a majority-owned subsidiary of the Company, filed a voluntary petition for liquidation under Chapter 7 of the U.S.

March 28, 2025, AVLP, formerly a majority-owned subsidiary of the Company, filed a voluntary petition for liquidation under Chapter 7 of the U.S.

Bankruptcy Code.

4 unchanged sentences

deconsolidation, the Company recognized a gain of $ 10.0 million, which is included in the condensed consolidated statement of operations

for the three months ended March 31, 2025.

for the six months ended June 30, 2025.

The Company evaluated the criteria for discontinued operations and determined that the operations

of AVLP did not meet the requirements for such classification.

Deconsolidation of Eco Pack Technologies Limited

April 16, 2025, Eco Pack, formerly a majority-owned subsidiary of the Company, filed a voluntary liquidation under the insolvency regulations in

As a result of the filing, the Company no longer maintained a controlling financial interest.

Accordingly, the Company deconsolidated

Eco Pack effective as of the filing date.

In connection with the deconsolidation, the Company recognized a loss of $ 0.4 million, which

is included in the condensed consolidated statement of operations for the six months ended June 30, 2025.

The Company evaluated the criteria

for discontinued operations and determined that the operations of Eco Pack did not meet the requirements for such classification.

Presentation of GIGA as Discontinued Operations

5 unchanged sentences

to deconsolidate GIGA and its subsidiaries effective on the petition date.

In connection

with the Chapter 11 reorganization process, the Company concluded that the operations of GIGA met the criteria for discontinued operations

as this strategic shift that will have a significant effect on the Company’s operations and financial results.

As a result, the

Company has presented the results of operations, cash flows and financial position of GIGA as discontinued operations in the accompanying

consolidated financial statements and notes for all periods presented.

connection with the Chapter 11 reorganization process, the Company concluded that the operations of GIGA met the criteria for discontinued

operations as this was a strategic shift that had and will continue to have a significant effect on the Company’s operations and

financial results.

As a result, the Company has presented the results of operations, cash flows and financial position of GIGA as discontinued

operations in the accompanying consolidated financial statements and notes for all periods presented.

The following table presents

1 unchanged sentence

Schedule of operations

For the Three Months Ended

For the Three

June 30, 2024

Revenue, products

5 unchanged sentences

Total operating expenses

Loss from operations

Income (loss) from operations

( 3,032,000 )

2 unchanged sentences

Interest expense

Total other income (expense), net

Loss before income taxes

( 1,356,000 )

Income tax benefit

Total other expense, net

( 1,207,000 )

Income (loss) before income taxes

( 4,239,000 )

Income tax provision (benefit)

Net income (loss)

( 4,224,000 )

Net loss attributable to non-controlling interest

Net loss available to common stockholders

Net income (loss) available to common stockholders

$ ( 2,995,000 )

2 unchanged sentences

Schedule of statement of cash flows

For the Three Months Ended March 31,

For the Six Months

Ended June 30, 2024

Cash flows from operating activities:

4 unchanged sentences

Amortization of intangibles

Stock-based compensation

Gain on extinguishment of debt

Changes in operating assets and liabilities:

Accounts receivable

( 2,210,000 )

Prepaid expenses and other current assets

2 unchanged sentences

Net cash used in operating activities

( 3,826,000 )

Cash flows from investing activities:

Purchase of property and equipment

Net cash used in investing activities

Cash flows from financing activities:

Payments on notes payable

Cash contributions from parent

Net cash provided by investing activities

Cash flows from financing activities:

Proceeds from notes payable

Net cash provided by financing activities

Effect of exchange rate changes on cash and cash equivalents

Net increase in cash and cash equivalents and restricted cash

Net decrease in cash and cash equivalents and restricted cash

( 1,019,000 )

Cash and cash equivalents and restricted cash at beginning of period

2 unchanged sentences

Cash paid during the period for interest

CHANGE IN PLAN OF SALE OF AGREE HOTEL PROPERTIES

On April 30, 2024, the Company

had a change in plan of sale for its four hotels owned and operated by AGREE.

As a result, as of April 30, 2024, the assets no longer

met the held for sale criteria and were required to be reclassified as held and used at the lower of adjusted carrying value or the fair

value at the date of the not to sell.

For presentation purposes, the assets and liabilities previously held for sale were reclassified

in the accompanying financial statements back to their original asset and liability groups at their previous carrying values.

REVENUE DISAGGREGATION

The following tables summarize

disaggregated customer contract revenues and the source of the revenue for the three months ended March 31, 2025 and 2024.

Revenues from

lending and trading activities included in consolidated revenues were primarily interest, dividend and other investment income, which

disaggregated customer contract revenues and the source of the revenue for the three and six months ended June 30, 2025 and 2024.

from lending and trading activities included in consolidated revenues were primarily interest, dividend and other investment income, which

are not considered to be revenues from contracts with customers under GAAP.

2 unchanged sentences

While not a separate reportable segment, Holding Co.

is included in the table below to reconcile to total consolidated revenue.

is included in the table below to reconcile the segments to total consolidated

The Company’s disaggregated

revenues consisted of the following for the three months ended March 31, 2025:

revenues consisted of the following for the three months ended June 30, 2025:

Schedule of disaggregated revenues

Primary Geographical

Middle East and

contracts with customers

Revenue, lending

and trading activities (North America)

Primary Geographical Markets

North America

Middle East and other

Revenue from contracts with customers

Revenue, lending and trading activities (North America)

Total revenue

units and systems

mined crypto assets at Sentinum owned and

operated facilities

Hotel and real

estate operations

contracts with customers

Revenue, lending

and trading activities

Major Goods or Services

Power supply units and systems

Revenue from mined crypto assets at Sentinum owned and operated facilities

Hotel and real estate operations

Revenue from contracts with customers

Revenue, lending and trading activities

Total revenue

Timing of Revenue Recognition

Goods and services

transferred at a point in time

Services transferred

contracts with customers

Goods and services transferred at a point in time

Services transferred over time

Revenue from contracts with customers

The Company’s disaggregated

revenues consisted of the following for the three months ended March 31, 2024:

revenues consisted of the following for the six months ended June 30, 2025:

Primary Geographical Markets

2 unchanged sentences

Revenue from contracts with customers

Revenue, lending and trading

activities (North America)

Revenue, lending and trading activities (North America)

Total revenue

1 unchanged sentence

Power supply units and systems

Revenue from mined crypto assets at Sentinum owned

operated facilities

Revenue from mined crypto assets at Sentinum owned and operated facilities

Hotel and real estate operations

Revenue from contracts with customers

Revenue, lending and trading activities

Total revenue

Timing of Revenue Recognition

Goods and services transferred at a point in time

Services transferred over time

Revenue from contracts with customers

The Company’s disaggregated

revenues consisted of the following for the three months ended June 30, 2024:

Primary Geographical Markets

North America

Middle East and other

Revenue from contracts with customers

Revenue, lending and trading activities (North America)

( 9,763,000 )

Total revenue

$ ( 9,763,000 )

Major Goods or Services

Power supply units and systems

Revenue from mined crypto assets at Sentinum owned and operated facilities

Revenue from Sentinum crypto mining equipment hosted at third-party facilities

1 unchanged sentence

Revenue from contracts with customers

Revenue, lending and trading

Revenue, lending and trading activities

( 9,763,000 )

Total revenue

$ ( 9,763,000 )

Timing of Revenue Recognition

1 unchanged sentence

Services transferred over time

Revenue from contracts with

Revenue from contracts with customers

The Company’s disaggregated

revenues consisted of the following for the six months ended June 30, 2024:

Primary Geographical Markets

North America

Middle East and other

Revenue from contracts with customers

Revenue, lending and trading activities (North America)

Total revenue

$ ( 664,000 )

Major Goods or Services

Power supply units and systems

Revenue from mined crypto assets at Sentinum owned and operated facilities

Revenue from Sentinum crypto mining equipment hosted at third-party facilities

Hotel and real estate operations

Revenue from contracts with customers

Revenue, lending and trading activities

Total revenue

$ ( 664,000 )

Timing of Revenue Recognition

Goods and services transferred at a point in time

Services transferred over time

Revenue from contracts with customers

FAIR VALUE OF FINANCIAL

following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within

the fair value hierarchy at March 31, 2025 (no material financial instruments that were measured at fair value on a recurring basis at

the fair value hierarchy at June 30, 2025 (no material financial instruments were measured at fair value on a recurring basis at

December 31, 2024):

Fair value, assets measured on recurring basis

Fair Value Measurement at March 31, 2025

Fair Value Measurement at June 30, 2025

Embedded conversion feature liabilities

7 unchanged sentences

The changes in Level 3 fair

value hierarchy during the three months ended March 31, 2025 and 2024 were as follows:

value hierarchy during the three and six months ended June 30, 2025 and 2024 were as follows:

Schedule of changes in fair value hierarchy

Level 3 Balance at

End of Period

Three months ended March 31, 2025

Level 3 Balance

at End of Period

Six months ended June 30, 2025

Embedded conversion feature liabilities

Level 3 Balance at

End of Period

Three months ended March 31, 2024

$ ( 1,274,000 )

Level 3 Balance

at Beginning of

Level 3 Balance

at End of Period

Six months ended June 30, 2024

Warrant liabilities

Embedded conversion feature liabilities

$ ( 755,000 )

Level 3 Balance

at Beginning of

Level 3 Balance

at End of Period

Three months ended June 30, 2025

Embedded conversion feature liabilities

$ ( 1,274,000 )

Level 3 Balance

at Beginning of

Level 3 Balance

at End of Period

Three months ended June 30, 2024

Warrant liabilities

Embedded conversion feature liabilities

CRYPTO ASSETS

The following table presents

revenue from mined crypto assets for the three months ended March 31, 2025 and 2024:

revenue from mined crypto assets for the three and six months ended June 30, 2025 and 2024:

Schedule of revenue from crypto assets

For the Three Months Ended

For the Six Months Ended

Revenue from mined crypto assets at Sentinum owned and operated facilities

2 unchanged sentences

The following table presents

the activities of the crypto assets (included in prepaid expenses and other current assets) for the three months ended March 31, 2025

the activities of the crypto assets (included in prepaid expenses and other current assets) for the three months ended June 30, 2025 and

Schedule of activities of the crypto assets

For the Three Months Ended

For the Six Months Ended

Balance at January 1

3 unchanged sentences

( 15,534,000 )

Payments to vendors with crypto assets

Payment of notes payable with crypto assets

Payment of interest payable with crypto assets

Realized (losses) gains on sale of crypto assets

Unrealized (loss) gain on crypto assets

Balance at March 31

Balance at June 30

PROPERTY AND EQUIPMENT, NET

At March 31, 2025 and December

At June 30, 2025 and December

31, 2024, property and equipment consisted of:

Schedule of property and equipment

March 31, 2025

June 30, 2025

December 31, 2024

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Schedule of depreciation

For the Three Months Ended March 31,

For the Three Months Ended

For the Six Months Ended

Depreciation expense

INTANGIBLE ASSETS, NET

At March 31, 2025 and December 31, 2024,

At June 30, 2025 and December 31, 2024,

intangible assets consisted of:

Schedule of intangible asset

March 31, 2025

June 30, 2025

December 31, 2024

10 unchanged sentences

Schedule of amortization expense

For the Three Months Ended March 31,

For the Three Months Ended

For the Six Months Ended

Amortization expense

of March 31, 2025, intangible assets subject to amortization have an average remaining useful life of 6.6 years.

of June 30, 2025, intangible assets subject to amortization have an average remaining useful life of 6.6 years.

The following

5 unchanged sentences

(“Alzamend”), Ault & Company, Inc.

(“Ault & Company”) and GIGA at March 31, 2025 and December 31,

(“Ault & Company”) and GIGA at June 30, 2025 and December 31,

2024, were comprised of the following:

11 unchanged sentences

Schedule of Interest income, related party

For the Three Months Ended March 31,

For the Three Months Ended

For the Six Months Ended

Interest income, related party

8 unchanged sentences

Schedule of investment in common stock

Investments in Common Stock, Related Parties at March 31, 2025

Investments in Common Stock, Related Parties at June 30, 2025

Gross Unrealized Losses

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The following tables summarize

the changes in the Company’s investments in Alzamend common stock during the three months ended March 31, 2025 and 2024:

the changes in the Company’s investments in Alzamend common stock during the three months ended June 30, 2025 and 2024:

Schedule of investment in warrants and common stock

For the Three Months Ended March 31,

For the Three Months Ended June 30,

Balance at April 1

Investment in common stock of Alzamend

Sale of Alzamend common stock

Realized loss in common stock of Alzamend

Unrealized gain (loss) in common stock of Alzamend

Balance at June 30

The following tables summarize

the changes in the Company’s investments in Alzamend common stock during the six months ended June 30, 2025 and 2024:

For the Six Months Ended June 30,

Balance at January 1

Investment in common stock of Alzamend

Unrealized loss in common stock of Alzamend

Balance at March 31

Sale of Alzamend common stock

Realized loss in common stock of Alzamend

Unrealized gain (loss) in common stock of Alzamend

Balance at June 30

Ault Lending, LLC (“Ault Lending”)

13 unchanged sentences

ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Other current liabilities at March 31,

Other current liabilities at June 30,

2025 and December 31, 2024 consisted of:

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River as contemplated by a registration statement previously filed by White River.

During the quarter ended March

31, 2024, ROI transferred 6.7 million shares of White River common stock with a fair value of $19.2 million at the date of transfer to

certain of its accredited investors to resolve the matters discussed above.

During the six months ended

June 30, 2024, ROI transferred 12.0 million shares of White River common stock with a fair value of $19.2 million at the date of transfer

to certain of its accredited investors to resolve the matters discussed above.

In conjunction with the transfers

to non-controlling interests, ROI converted a portion of their White River’s Series A Convertible Preferred Stock into common stock

to non-controlling interests, ROI converted a portion of its White River Series A convertible preferred stock into common stock

and recorded a non-cash $ 17.9 million gain on conversion.

NOTES PAYABLE

Notes payable at March 31,

Notes payable at June 30,

2025 and December 31, 2024, were comprised of the following:

1 unchanged sentence

AGREE secured construction loans, in default

March 31, 2026

Circle 8 revolving credit facility

Circle 8 cranes with a book

value of $29.3 million

December 16, 2025

8 cranes with a book value of $27.7 million

Circle 8 equipment financing notes

Circle 8 equipment with a

book value of $4.1 million

September 15, 2025

8 equipment with a book value of $3.8 million

15, 2025 through June 15, 2027

15% term notes

October 31, 2024

15% term notes, in default

ROI promissory note, in default

18 unchanged sentences

Company’s notes payable, assuming the exercise of all extensions that are exercisable solely at the Company’s option, as of

March 31, 2025 were:

June 30, 2025 were:

Schedule of maturities

2 unchanged sentences

Schedule of interest expense

For the Three Months Ended March 31,

For the Three Months Ended

For the Six Months Ended

Contractual interest expense

4 unchanged sentences

Notes payable, related party

at March 31, 2025 and December 31, 2024, were comprised of the following:

Schedule of notes payable, related party

at June 30, 2025 and December 31, 2024, were comprised of the following:

Schedule of interest expense, related party

Interest rate

March 31, 2025

June 30, 2025

December 31, 2024

4 unchanged sentences

Schedule of interest expense, related party

For the Three Months Ended March 31,

For the Three Months Ended

For the Six Months Ended

Interest expense, related party

CONVERTIBLE NOTES

Convertible notes payable at March 31, 2025 and

Convertible notes payable at June 30, 2025 and

December 31, 2024, were comprised of the following:

2 unchanged sentences

Interest rate

March 31, 2025

June 30, 2025

December 31, 2024

SJC convertible promissory note

SJC Lending, LLC (“SJC”) convertible promissory note

75% of 5-day VWAP

2 unchanged sentences

$ 0.11 (ROI stock)

Orchid convertible promissory note

April 27, 2024

Orchid Finance LLC (“Orchid”) convertible promissory notes, in default

75% of 5-day VWAP

June 30, 2025

10% original issue discount (“OID”) convertible promissory note

20% original issue discount (“OID”) convertible promissory notes

80% of 5-day VWAP

September 30, 2025

10% OID convertible promissory note

Forbearance convertible promissory note, in default

June 30, 2025

Convertible promissory note – OID only, in default

12 unchanged sentences

Convertible notes payable, net of financing cost – long-term portion

forbearance and extension fees and OID costs that are amortized to interest expense over the life of the notes.

(1) Includes forbearance and extension fees and OID costs that are amortized to interest expense over the

life of the notes.

Convertible Promissory Notes

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date of conversion into shares of Class A common stock.

April 1, 2025, the Company issued a convertible promissory note to an institutional investor in the principal amount of $ 1.65 million

in consideration for $1.5 million in cash previously advanced to the Company.

The note bears interest at 15% per annum, increasing to

18 % per annum upon an event of default, as defined in the note.

The note matures on September 30, 2025 .

The note is convertible into shares

of the Company’s Class A common stock at any time at a conversion price equal to the greater of (i) the Floor Price and (ii) the

lesser of (A) 75% of the VWAP (as defined in the note) of the Class A common stock during the five trading days immediately prior to the

April 1, 2025 issuance date, or (B) 75% of the VWAP during the five trading days immediately prior to the date of conversion.

The conversion

price is not subject to adjustment for stock splits, combinations, or dividends.

The note was issued with an OID of 10%.

Convertible Promissory Note

February 2025, the Company and an institutional investor (the “Investor”) entered into an amended and restated forbearance

agreement pursuant to which the Investor agreed to forebear through the close of business on May 15, 2025 , from exercising the rights

and remedies it is entitled in consideration for the Company’s agreement to issue to the Investor an amended and restated convertible

promissory note in the amount of $ 3.5 million (the “A&R Forbearance Note”), consisting of (i) the amount then due under

the original forbearance agreement of $0.9 million, (ii) a forbearance extension fee of $0.3 million and (iii) a true-up amount of $2.3

Subject to the approval by the NYSE and the Company’s stockholders, the A&R Forbearance Note is convertible into shares

of Class A common stock at a conversion price equal to $ 2.00 , subject to adjustment.

The A&R Forbearance Note accrues interest at

the rate of 18 % per annum and matures on May 15, 2025.

February 2025, the Company and an institutional investor entered into an amended and restated forbearance agreement pursuant to which

the investor agreed to forebear through the close of business on May 15, 2025, from exercising the rights and remedies it is entitled

in consideration for the Company’s agreement to issue to the investor an amended and restated convertible promissory note in the

amount of $ 3.5 million (the “A&R Forbearance Note”), consisting of (i) the amount then due under the original forbearance

agreement of $0.9 million, (ii) a forbearance extension fee of $0.3 million and (iii) a true-up amount of $2.3 million.

Subject to the

approval by the NYSE and the Company’s stockholders, the A&R Forbearance Note is convertible into shares of Class A common stock

at a conversion price equal to $2.00, subject to adjustment.

The A&R Forbearance Note accrues interest at the rate of 18 % per annum

with a maturity date of May 15, 2025 .

On June 3, 2025, the Company and the investor entered into an amendment to the A&R Forbearance

Note, pursuant to which the maturity date of the A&R Forbearance Note was extended until June 30, 2025.

Convertible Promissory Note

12 unchanged sentences

but not greater than $10.00 per share.

Company identified embedded derivative features within certain convertible promissory notes issued during the quarter ended March 31,

2025, that required bifurcation and separate accounting as derivative liabilities under ASC 815.

Specifically, the embedded conversion

options associated with the Orchid convertible promissory notes and the SJC convertible promissory note were determined to meet the criteria

for derivative classification.

OID convertible promissory notes

April 15, 2025, the Company issued convertible promissory notes in aggregate principal amount of $ 5.0 million to Target Capital 14 LLC

and Secure Net Capital LLC in exchange for $ 4.0 million in cash proceeds.

The Company incurred placement agent fees and expenses of approximately

$0.5 million in connection with the transaction.

The notes do not bear interest unless an event of default occurs, in which case the interest

rate increases to 20% per annum.

The notes mature on September 30, 2025.

notes are convertible into Class A common stock at any time at a conversion price equal to the greater of (i) the Floor Price and (ii)

80% of the lowest closing price of the Class A common stock during the five trading days immediately prior to the date of conversion.

The conversion price is not subject to adjustment for stock dividends, splits, or similar corporate actions.

The notes were issued with

an original issue discount of 20%.

Company identified embedded derivative features within certain convertible promissory notes issued during the six months ended June 30,

2025, that required bifurcation and separate accounting as derivative liabilities under Accounting Standards Codification (“ASC”)

815, Derivatives and Hedging Activities .

Specifically, the embedded conversion options associated with the Orchid convertible promissory

notes, the SJC convertible promissory note and the April 2025 convertible notes were determined to meet the criteria for derivative classification.

fair value of the embedded derivative liabilities was estimated using a Monte Carlo simulation model.

6 unchanged sentences

Schedule of valuation of the embedded derivatives

Orchid Note (March 14, 2025)

SJC Note (March 21, 2025)

Weighted Average at

June 30, 2025

Valuation technique

11 unchanged sentences

its impact on the overall fair value of the embedded option.

fair value of the embedded derivative liabilities at inception and as of March 31, 2025 was as follows:

· Orchid Note:

$1.0 million;

$1.3 million.

of Convertible Notes

the six months ended June 30, 2025, principal, accrued and unpaid interest of $ 11.3 million were converted into 4.9 million shares

of Class A common stock of the Company.

Loss on Extinguishment of Convertible Notes

During the three months ended March 31, 2025, the Company recognized

a total net loss on extinguishment of convertible notes of $4.6 million.

This amount includes:

· A gain of $0.3 million resulting from the conversion of $0.7

million of convertible notes into 0.2 million shares of Class A common stock , which had

a fair value of $0.4 million at the time of conversion ;

loss of $2.6 million related to the issuance of the A&R Forbearance

The A&R Forbearance Note, with a principal amount of $3.5 million, was determined to be substantially different from the original

note due to significant changes in terms, including the addition of a conversion feature and increased principal amount.

As such, extinguishment

accounting was applied, and a loss was recognized based on the difference between the value of the A&R Forbearance Note and the net

carrying amount of the original note;

the six months ended June 30, 2025, the Company recognized a total net loss on extinguishment of convertible notes of $ 4.6 million.

amount includes:

· A gain of $0.3 million resulting from the conversion of $0.7 million of convertible notes into 0.2 million

shares of Class A common stock, which had a fair value of $0.4 million at the time of conversion;

· A loss of $2.6 million related to the issuance of the A&R Forbearance Note.

The A&R Forbearance

Note, with a principal amount of $3.5 million, was determined to be substantially different from the original note due to significant

changes in terms, including the addition of a conversion feature and increased principal amount.

As such, extinguishment accounting was

applied, and a loss was recognized based on the difference between the value of the A&R Forbearance Note and the net carrying amount

of the original note;

· A loss of $1.0 million related to the Orchid convertible promissory note issued on March 14, 2025.

principal amount of the new note equaled the aggregate principal and accrued interest of the notes exchanged, the fair value of the new

note, including the embedded derivative liability, exceeded the carrying amount of the original notes.

the principal amount of the new note equaled the aggregate principal and accrued interest of the notes exchanged, the fair value of the

new note, including the embedded derivative liability, exceeded the carrying amount of the original notes.

As a result, a loss on extinguishment

1 unchanged sentence

· A loss of $1.3 million related to the SJC convertible promissory note issued on March 21, 2025.

principal of the new note matched the principal and accrued interest of the exchanged notes, the combined fair value of the new note and

its embedded derivative exceeded the carrying amount of the original instruments.

the principal of the new note matched the principal and accrued interest of the exchanged notes, the combined fair value of the new note

and its embedded derivative exceeded the carrying amount of the original instruments.

Accordingly, a $1.3 million loss on extinguishment

2 unchanged sentences

Company’s convertible notes payable, assuming the exercise of all extensions that are exercisable solely at the Company’s

option, as of March 31, 2025 were:

option, as of June 30, 2025 were:

Schedule of contractual maturities

2025 (remainder)

COMMITMENTS AND CONTINGENCIES

Related Party Commitments

During the three months ended

June 30, 2025, the Company’s subsidiaries, BitNile.com, Inc.

and askROI, Inc., entered into marketing and promotional commitments

with a subsidiary of Ault & Company.

The commitments, which total approximately $9.2 million, relate to the coordination and

execution of media placements, promotional events, and related marketing services in connection with various contracted events.

services are billed on a pass-through basis, at cost, without any mark-up or commission.

Of the total commitments, approximately $ 4.1

million was expensed during the three months ended June 30, 2025.

Contingencies

42 unchanged sentences

Company filed an Answer to the ROI Complaint and asserted numerous affirmative defenses.

On or about July 29, 2025,

the Court entered an Order (the “Consolidation and Dismissal Order”) consolidating this action with that certain action captioned

Arena Investors, LP v.

Ault III and Kristine Ault, Index No.

655857/2024, pending in the Supreme Court of the State of New York,

County of New York (the “Second Filed Action”).

In the Consolidation and Dismissal Order, the Court also dismissed so much

of the complaint from the Second Filed Action that asserts claims arising from an alleged failure to pay a redemption premium as set forth

in that certain Event of Default Redemption Notice, dated November 5, 2024, that Arena transmitted to, among others, the Company.

Based on the Company’s

13 unchanged sentences

The Company had accrued loss

contingencies related to litigation matters of $ 2.1 million and $ 2.3 million as of March 31, 2025 and December 31, 2024, respectively.

contingencies related to litigation matters of $ 1.9 million and $ 2.3 million as of June 30, 2025 and December 31, 2024, respectively.

STOCKHOLDERS’ EQUITY

7 unchanged sentences

A common stock.

The Class B common stock is convertible at any time into Class A common stock on a one-for-one basis.

The Class B common stock is convertible at any time into Class A common stock on a one-for-one basis at the option of

the holder of the Class B common stock.

Preferred Stock

Preferred stock as of March

Preferred stock as of June

30, 2025 consisted of the following:

2 unchanged sentences

Outstanding at

March 31, 2025

June 30, 2025

Series A Convertible Preferred Stock

2 unchanged sentences

Series D Cumulative Redeemable Perpetual Preferred Stock

Series E Redeemable Perpetual Preferred Stock

Series E Cumulative Redeemable Perpetual Preferred Stock

Series F Exchangeable Preferred Stock

8 unchanged sentences

Series D Cumulative Redeemable Perpetual Preferred Stock

Series E Redeemable Perpetual Preferred Stock

Series E Cumulative Redeemable Perpetual Preferred Stock

Series F Exchangeable Preferred Stock

2 unchanged sentences

to issue 25.0 million shares of preferred stock, $0.001 par value.

As of March 31, 2024, the rights, preferences, privileges and restrictions

As of June 30, 2025, the rights, preferences, privileges and restrictions

on the remaining authorized 18.3 million shares of preferred stock have not been determined.

7 unchanged sentences

shares of Series B Convertible Preferred Stock (“Series B Preferred Stock”) for a total purchase price of up to $50.0 million.

The securities purchase agreement provides that the transaction shall be conducted through 49 separate tranche closings, provided, however,

that the investor has the ability, exercisable in its sole discretion, to purchase any number of shares of Series B Preferred Stock prior

to the dates of the tranche closings provided for in the securities purchase agreement.

The initial tranche closing, which is expected

to close promptly after the investor has converted out of the Exchange Note, will consist of the sale and issuance to the investor of

2,000 shares of Series B Preferred Stock for an aggregate of $2.0 million.

Pursuant to the securities purchase agreement, provided certain

closing conditions have been met, the investor shall purchase up to 4,800 shares of Series B Preferred Stock on a monthly basis, with

the investor being required to purchase 1,000 shares per month.

The securities purchase agreement provides that the transaction shall be conducted through 49 separate tranche closings;

investor may, at its sole discretion, purchase additional shares ahead of the scheduled closings.

During the three months ended

June 30, 2025, the Company issued an aggregate of 7,899 shares of Series B Preferred Stock for gross proceeds of approximately $ 7.9 million.

In the same period, the investor converted approximately 5,238 shares of Series B Preferred Stock into shares of Class A common stock.

In addition, approximately 20 shares of Series B Preferred Stock were issued as paid-in-kind (“PIK”) dividends pursuant to

the terms of the Series B Preferred Stock.

Each share of Series B Preferred

Stock has a stated value of $1,000 and is convertible into shares of Class A common stock at a conversion price equal the lesser of a

25% discount to the Company’s volume weighted average price during the five trading days immediately prior to (A) the date of execution

of the securities purchase agreement or (B) the date of conversion into shares of Class A common stock, but not greater than $10 per share.

Notwithstanding the foregoing, in no event shall the Series B Preferred Stock be convertible at less than the Floor Price.

of Series B Preferred Stock are entitled to cumulative cash dividends at an annual rate of 15%, or $150 per share, based on the stated

value per share.

Dividends shall accrue for as long as any shares of Series B Preferred Stock remain issued and outstanding and are payable

monthly in arrears.

For the first two years, the Company may elect to pay the dividend amount in additional shares of Series B Preferred

Stock rather than cash.

The holders of the Series B Preferred Stock are entitled to vote with the Class A common stock as a single class

on an as-converted basis.

Subsequent Event – Series B Convertible

Preferred Stock Amendment

Stock has a stated value of $1,000 and is convertible into shares of Class A common stock at a conversion price equal to the greater of

(i) the Floor Price and (ii) 75% of the Company’s lowest VWAP during the five trading days immediately prior to the date of conversion,

subject to a maximum of $10.00 per share.

The holders are entitled to cumulative dividends at a 15% annual rate, payable monthly in arrears,

and for the first two years, the Company may elect to pay such dividends in additional shares of Series B Preferred Stock in lieu of cash.

On April 23, 2025, the Company

1 unchanged sentence

Preferred Stock.

The amendment, which was approved by the Board of Directors on April 22, 2025, became effective upon filing with the

Secretary of State of the State of Delaware.

The amendment revised the definition of “Conversion Price” to the greater of

(i) the Floor Price and (ii) 75% of the Company’s lowest VWAP during the five trading days immediately preceding conversion, subject

to a maximum price of $10.00 per share, as adjusted for certain corporate actions.

This amendment, approved by the Board of Directors on April 22, 2025, revised the definition of “Conversion Price”

to the greater of (i) the Floor Price and (ii) 75% of the Company’s lowest VWAP during the five trading days immediately preceding

conversion, subject to a maximum of $10.00 per share.

of Equity Purchase Agreement

On May 28, 2025, the Company

and Orion Equity Partners, LLC (“Orion”) mutually agreed to terminate the Purchase Agreement originally entered into on June

24, 2024, as subsequently amended (the “Purchase Agreement”).

The Purchase Agreement provided the Company with the right,

subject to certain terms and conditions, to sell up to $25.0 million of its 13.00% Series D Cumulative Redeemable Perpetual Preferred

Stock (the “Series D Preferred Stock”) to Orion over a 36-month period.

Prior to termination, the Company issued an aggregate

of 0.3 million shares of Series D Preferred Stock pursuant to the Purchase Agreement, generating net proceeds of approximately $3.5 million.

No further shares will be issued under the Purchase Agreement following its termination.

of Series G Preferred Stock and Warrants

During the six months

ended June 30, 2025, the Company sold to Ault & Company an aggregate of 960

shares of Series G Convertible Preferred Stock and warrants to purchase an aggregate of 0.2

million shares of Class A common stock, for an aggregate purchase price of $ 1.0

of Convertible Notes

the six months ended June 30, 2025 , the Company issued 4.9 million shares of Class A common stock

upon conversion of convertible promissory notes payable (see Note 16).

The Company calculates its

interim income tax provision in accordance with ASC Topic 270, Interim Reporting, and Accounting Standards Codification (“ASC”)

Topic 740, Income Taxes.

The effective tax rate (“ETR”) from continuing operations was 1.3 % for the three months ended March

31, 2025, and 0.0 % for the same period in 2024.

The Company recorded an income tax provision of $ 0.1 million for the three months ended

March 31, 2025, and recognized an income tax benefit of $ 1,000 for the three months ended March 31, 2024.

The difference between the ETR

and the federal statutory rate of 21 % is primarily due to items recognized for financial reporting purposes that are permanently disallowed

interim income tax provision in accordance with ASC Topic 270, Interim Reporting, and Topic 740, Income Taxes.

The difference between

the effective tax rate and the federal statutory rate of 21 % is primarily due to items recognized for financial reporting purposes that

are permanently disallowed for U.S.

federal income tax purposes, as well as changes in the valuation allowance.

NET INCOME (LOSS) PER SHARE

The following table presents

the calculation of basic and diluted net income per share for the three months ended March 31, 2024:

Schedule of basic and diluted net income per share

For the Three

March 31, 2024

Net income from continuing operations

net income attributable to non-controlling interest, continuing operations

( 7,135,000 )

Preferred stock dividends

( 1,260,000 )

Numerator for basic earnings per share (“EPS”) - Net income (loss) from continuing operations attributable to Hyperscale Data, Inc.

Numerator for basic EPS - Net loss from discontinued operations attributable to Hyperscale Data, Inc.

( 3,336,000 )

Effect of dilutive securities:

Interest expense associated with convertible notes, continuing operations

Series C convertible preferred stock dividend

Numerator for diluted EPS - Net income from continuing operations attributable to Hyperscale Data, Inc., after the effect of dilutive securities

Numerator for diluted EPS - Net loss from discontinued operations attributable to Hyperscale Data, Inc.

$ ( 3,336,000 )

Denominator for basic EPS - Weighted average shares of common stock outstanding

Effect of dilutive securities:

Convertible notes

Series C convertible preferred stock

Denominator for diluted EPS - Weighted average shares of common stock outstanding after the effect of dilutive securities

Basic net income (loss) per share from:

Continuing operations

Discontinued operations

Basic net income per share

Diluted net income (loss) per share from:

Continuing operations

Discontinued operations

Diluted net income per share

For the three ended March

31, 2025, net loss per share is computed by dividing the net loss to common stockholders by the weighted average number of common shares

The calculation of the basic and diluted earnings per share is the same for the three months ended March 31, 2025, as the

effect of the potential common stock equivalents is anti-dilutive due to the Company’s net loss position for the period.

Anti-dilutive

securities, which are convertible into or exercisable for the Company’s common stock, consist of the following at March 31, 2025:

Schedule of anti-dilutive

The One Big Beautiful Bill

Act (“OBBB”) was enacted into law on July 4, 2025.

The OBBB introduced significant tax law changes affecting various corporate

tax provisions, including limitations on business interest expense deductions, immediate expensing of domestic research and experimentation

expenditures under Section 174, updates to executive compensation aggregation rules under Section 162(m), modifications to certain tax

credits, and changes to international tax items such as GILTI, FDII, and BEAT.

The Company is currently evaluating

the impact of the OBBB on its deferred tax assets and liabilities, valuation allowance, and uncertain tax positions.

The Company will

evaluate the impact of OBBB in its third quarter financial statements, the period the law was enacted.

The Company does not expect a material

impact to its financial statements from the OBBB.

As the Company maintains a full valuation allowance, any change in net deferred tax

assets would be accompanied by a corresponding adjustment to the valuation allowance.

NET LOSS PER SHARE

Net loss per share is computed

by dividing the net loss to common stockholders by the weighted average number of Class A and Class B common shares outstanding.

The calculation

of the basic and diluted earnings per share is the same for all periods presented as the effect of the potential common stock equivalents

is anti-dilutive due to the Company’s net loss position for all periods presented.

Anti-dilutive securities, which are convertible

into or exercisable for the Company’s Class A common stock, consisted of the following at June 30, 2025 and 2024:

Schedule of anti-dilutive securities

June 30, 2025

June 30, 2024

Convertible preferred stock

Convertible notes

Class B common stock

SEGMENT AND CUSTOMERS INFORMATION

The Company had the following reportable

segments as of March 31, 2025 and 2024;

The Company had the following

reportable segments as of June 30, 2025 and 2024;

see Note 1 for a brief description of the Company’s business.

The following data presents the revenues,

expenditures and other operating data of the Company and its operating segments for the three months ended March 31, 2025:

The following data presents

the revenues, expenditures and other operating data of the Company and its operating segments for the six months ended June 30, 2025:

Schedule of operating segments

20 unchanged sentences

( 16,511,000 )

( 6,384,000 )

Other income (expense):

7 unchanged sentences

Total other expense, net

( 5,620,000 )

Loss before income taxes

7 unchanged sentences

$ ( 11,503,000 )

Capital expenditures for the year ended March 31, 2025

Segment identifiable assets as of March 31, 2025

Capital expenditures for the six months ended June 30, 2025

Segment identifiable assets as of June 30, 2025

$ 213,206,000

The following data presents the revenues,

expenditures and other operating data of the Company and its operating segments for the three months ended March 31, 2024:

The following data presents

the revenues, expenditures and other operating data of the Company and its operating segments for the three months ended June 30, 2025:

Revenue, crane operations

5 unchanged sentences

Cost of revenue

Gross profit (loss)

( 2,145,000 )

Operating expenses

8 unchanged sentences

$ ( 5,334,000 )

( 10,127,000 )

Other income (expense):

2 unchanged sentences

( 7,664,000 )

Gain on deconsolidation of subsidiary

Loss on the sale of fixed assets

Total other expense, net

( 7,340,000 )

Loss before income taxes

$ ( 17,467,000 )

Depreciation and amortization expense

Interest expense

$ ( 2,135,000 )

$ ( 380,000 )

$ ( 207,000 )

$ ( 4,934,000 )

$ ( 7,664,000 )

Capital expenditures for the three months ended June 30, 2025

The following data presents

the revenues, expenditures and other operating data of the Company and its operating segments for the six months ended June 30, 2024:

Revenue, crane operations

Revenue, crypto assets mining

Revenue, hotel and real estate operations

Revenue, lending and trading activities

Revenue, other

Total revenue

Cost of revenue

Gross profit (loss)

Operating expenses

Research and development

Selling and marketing

General and administrative

Impairment of property and equipment

Total operating expenses

(Loss) income from operations

$ ( 1,302,000 )

$ ( 850,000 )

$ ( 7,582,000 )

$ ( 7,014,000 )

$ ( 10,296,000 )

( 23,273,000 )

Other income (expense):

Interest and other income

Interest expense

( 10,950,000 )

Gain on conversion of investment in equity securities to marketable equity securities

1 unchanged sentence

Loss from investment in unconsolidated entity

( 1,958,000 )

Impairment of equity securities

( 6,266,000 )

Provision for loan losses, related party

2 unchanged sentences

Total other expense, net

Income before income taxes

( 2,325,000 )

Loss before income taxes

$ ( 25,598,000 )

Depreciation and amortization expense

6 unchanged sentences

$ ( 3,130,000 )

Capital expenditures for the three months ended March 31, 2024

$ ( 10,950,000 )

Capital expenditures for the six months ended June 30, 2024

Segment identifiable assets as of December 31, 2024

$ 220,471,000

The following data presents

the revenues, expenditures and other operating data of the Company and its operating segments for the three months ended June 30, 2024:

Revenue, crane operations

Revenue, crypto assets mining

Revenue, hotel and real estate operations

Revenue, lending and trading activities

( 9,763,000 )

Revenue, other

Total revenue

( 9,763,000 )

Cost of revenue

Gross profit (loss)

( 9,763,000 )

( 3,788,000 )

Operating expenses

Research and development

Selling and marketing

General and administrative

Impairment of property and equipment

Total operating expenses

Loss from operations

$ ( 808,000 )

$ ( 9,858,000 )

$ ( 548,000 )

$ ( 7,364,000 )

$ ( 238,000 )

$ ( 3,353,000 )

$ ( 4,761,000 )

( 26,930,000 )

Other income (expense):

Interest and other income

Interest expense

( 5,319,000 )

Loss on extinguishment of debt

Loss from investment in unconsolidated entity

( 1,291,000 )

Gain on the sale of fixed assets

Total other expense, net

( 6,589,000 )

Loss before income taxes

$ ( 33,519,000 )

Depreciation and amortization expense

Interest expense

$ ( 960,000 )

$ ( 944,000 )

$ ( 942,000 )

$ ( 2,304,000 )

$ ( 5,241,000 )

Capital expenditures for the year ended December 31, 2023

CONCENTRATIONS OF CREDIT AND REVENUE RISK

Significant customers are those that represent

more than 10% of the Company’s total revenue or accounts receivable balances for the periods and as of each balance sheet date presented.

For each significant customer, revenue as a percentage of total revenue and gross accounts receivable as a percentage of total gross accounts

receivable as of the periods presented were as follows:

Significant customers are

those that represent more than 10% of the Company’s total revenue or accounts receivable balances for the periods and as of each

balance sheet date presented.

For each significant customer, revenue as a percentage of total revenue and gross accounts receivable as

a percentage of total gross accounts receivable as of the periods presented were as follows:

Schedule of concentrations of credit and revenue risk

Accounts Receivable

For the Three Months Ended March 31,

For the Three Months Ended June 30,

For the Six Months Ended June 30,

*less than 10%

SUBSEQUENT EVENTS

Issuances of Series D Preferred Stock

From April 1, 2025 through

May 12, 2025, the Company issued a total of 52,700 shares of its Series D preferred stock for the settlement of ELOC advances

totaling $ 0.6 million.

Sale of Series G Preferred Stock

On April 10, 2025, the Company

sold to Ault & Company 100 shares of Series G Preferred Stock and Series G Warrants to purchase 16,898 shares of Class A common stock,

for a purchase price of $ 0.1 million.

10% OID Convertible Promissory Note

Between April 9, 2025 and May 5, 2025,

the Company issued 611,812 shares of Class A common stock upon the conversion of $ 3.6 million of principal and interest on the 10% OID

convertible promissory note.

The Class A Common Stock was issued at a price of $ 5.87 per share.

Orchid Convertible Promissory Note

Between April 24, 2025 and May 5, 2025,

the Company issued 184,623 shares of Class A common stock upon the conversion of $ 0.2 million of principal and interest on the Orchid

convertible promissory note.

The Class A Common Stock was issued at a price of $ 1.28 per share.

April 1, 2025 Convertible Promissory Note

On April 1, 2025, the Company

issued to an institutional investor a convertible promissory note in the principal face amount of $ 1.7 million in consideration for an

advance we received of $ 1.5 million.

The note accrues interest at the rate of 15 % per annum.

The note will mature on September 30, 2025 .

The note is convertible into shares of Class A common stock at a conversion price equal to the greater of (i) the Floor Price and (ii)

the lesser of 75% of the VWAP (as defined in the note) of the Class A common stock during the five trading days immediately prior to (A)

the date of issuance of the note or (B) the date of conversion into shares of Class A common stock.

April 15, 2025 Convertible Promissory

On April 15, 2025, the Company

entered into securities purchase agreements (the “Agreements”) with institutional investors (the “Investors”),

pursuant to which the Company issued to the Investors convertible promissory notes in the aggregate principal face amount of $5.0 million

(the “Notes”) in aggregate gross consideration of $ 4.0 million in cash paid by the Investors to the Company, prior to placement

agent fees and expenses of approximately $ 0.5 million (the “Transaction”).

The Notes have an aggregate

principal face amount of $ 5.0 million and were issued with an original issue discount of 20 % , or $ 1.0 million.

The Notes do not accrue

interest unless an event of default at which time the Notes would accrue interest at 20% per annum.

The Notes will mature on September

The Notes are convertible into shares (the “Conversion Shares”) of the Company’s class A common stock at any

time after NYSE American approval of the supplemental listing application at a conversion price equal to the greater of (i) $0.40 per

share (the “Floor Price”), which Floor Price shall not be adjusted for stock dividends, stock splits, stock combinations and

other similar transactions and (ii) 80% of the lowest closing price of the Class A common stock during the five trading days immediately

prior to the date of conversion into shares of Class A common stock.

May 13, 2025 OID Only Term

2025, the Company entered into an OID only term note agreement with an institutional investor with a principal amount of $ 1.4 million

and an OID of $ 0.1 million.

The maturity date of the promissory note is May 27, 2025.

Ault entered into a personal guaranty agreement

for the benefit of the investor.

Conversions of

Convertible Notes

1, 2025 and August 14, 2025, the Company issued approximately 5.1 million shares of its Class A common stock upon the conversion of approximately

$ 6.1 million in aggregate principal and accrued interest under its outstanding convertible notes payable.

Series B Preferred

Between July 1, 2025

through August 14, 2025, the Company sold an aggregate of 10,955

shares of its Series B Convertible Preferred Stock for gross proceeds of approximately $ 11.0

In addition, during that same period, an aggregate of $ 10.5

million in stated value of Series B Convertible Preferred Stock was converted into approximately 13.3

million shares of the Company’s Class A common stock.

Circle 8 Promissory Note

2025, Circle 8 entered into a financing agreement with Flagstar Financial & Leasing, LLC.

Pursuant to the terms of the agreement,

Circle 8 executed a promissory note in the principal amount of $ 1.4 million, bearing interest at a fixed rate of 6.4 % per annum.

is payable over a term of four years in 47 monthly installments of approximately $ 32,000 beginning on August 20, 2025, with a final balloon

payment of the remaining principal and accrued interest due on July 20, 2029.

The financing

is secured by a first priority lien on a newly acquired mobile crane.

The proceeds of the loan were disbursed directly to the equipment

vendor and to cover related financing costs.

is evaluating the appropriate accounting treatment for this transaction, which is expected to be classified as a secured equipment loan

and recognized as a long-term liability, with the corresponding asset capitalized and depreciated over its estimated useful life.

Series H Convertible Preferred

On July 31, 2025, the Company

entered into a securities purchase agreement (the “July 2025 SPA”) with Ault & Company, pursuant to which it agreed to

sell, in one or more closings, to Ault & Company up to 100,000 shares of Series H convertible preferred stock (“Series H Preferred

Stock”) for a total purchase price of up to $100.0 million.

The July 2025 SPA provides that the financing may be conducted through

one or more closings.

As of the date of this filing, no shares of Series H Preferred Stock have been sold, nor has its Certificate of

Designations been filed with the State of Delaware, the jurisdiction where the Company is incorporated.

Each share of Series H Preferred

Stock has a stated value of $ 1,000.00 and is convertible into shares of class A common stock at a conversion price equal to the greater

of (i) $0.10 per share and (ii) the lesser of (A) $0.79645 or (B) 105% of the volume weighted average price of the class A common stock

during the five trading days immediately prior to the date of conversion.

The conversion price is subject to adjustment in the event of

an issuance of Class A common stock at a price per share lower than the conversion price then in effect, as well as upon customary stock

splits, stock dividends, combinations or similar events.

The holders of Series H Preferred Stock are entitled to cumulative cash dividends

at an annual rate of 9.5%, or $95.00 per share, based on the stated value per share.

Dividends shall accrue for 10 years from the date

of issuance of such shares of Series H Preferred Stock and are payable monthly in arrears.

For the first two years, the Company may elect

to pay the dividend amount in shares of Class A common stock rather than cash.

The holders of the Series H Preferred Stock are entitled

to vote with the Class A common stock as a single class on an as-converted basis.

2025 Stock Incentive Plan and Option Grants

On July 31, 2025, the Board

of Directors approved grants of 7.25 million non-qualified stock options to purchase shares of Class A common stock for the Company’s

directors and executive officers.

The grants were issued on August 12, 2025, at an exercise price of $ 0.72 per share.

These grants are made outside of the 2025 Stock Incentive Plan and are subject to stockholder and exchange approval.

On July 31, 2025, the

Board also approved the Company’s 2025 Stock Incentive Plan, which authorizes the issuance of up to 8.0

million shares, and approved grants of options under the plan covering an aggregate of 6.2

million shares to employees at an exercise price of $ 0.72 per share.

Vesting for all 13.45 million grants is 50% upon stockholder and exchange

approval and 50% in equal monthly installments over 24 months beginning January 1, 2026.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements