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Item 2. Management’s Discussion and Analysis

2025-11-18 compared with 2025-08-14 · 216 added, 158 removed, 201 unchanged (65% of the section changed)

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The following discussion and analysis of the results of operations and financial condition of KULR Technology Group, Inc.

(“KULR”) and its wholly-owned subsidiary, KULR Technology Corporation (“KTC”) (collectively referred to as “KULR” or the “Company”) as of June 30, 2025 and for the three and six months ended June 30, 2025 and 2024 should be read in conjunction with our unaudited condensed consolidated financial statements and the notes to those unaudited condensed consolidated financial statements that are included elsewhere in this Quarterly Report.

(“KULR”) and its wholly-owned subsidiary, KULR Technology Corporation (“KTC”) (collectively referred to as “KULR” or the “Company”) as of September 30, 2025 and for the three and nine months ended September 30, 2025 and 2024 should be read in conjunction with our unaudited condensed consolidated financial statements and the notes to those unaudited condensed consolidated financial statements that are included elsewhere in this Quarterly Report.

References in this Management’s Discussion and Analysis of Financial Condition and Results of Operations to “us”, “we”, “our” and similar terms refer to the Company.

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Risk Factors in our Annual Report on Form 10-K which was filed with the SEC on March 31, 2025, unless disclosed elsewhere in this Quarterly Report.

KULR Technology Group, Inc., through our wholly owned subsidiary KULR Technology Corporation, develops and commercializes high-performance thermal management technologies for batteries, electronics, and other components across an array of battery-powered applications.

For aerospace and Department of Defense applications, our solutions target high performance applications in direct energy, hypersonic vehicles and satellite communications.

For commercial applications, our main focus is a total solution to battery safety and sustainability by which we aim to mitigate the effects of thermal runaway propagation which has been known to cause random fires in lithium-ion (“Li-ion”) batteries.

This total battery safety solution can be used for electric vehicles, energy storage, battery recycling transportation, cloud computing and 5G communication devices.

Our proprietary core technology is a carbon fiber material that provides what we believe to be superior thermal conductivity and heat dissipation for an ultra-lightweight and pliable material.

By leveraging our proprietary cooling solutions that have been developed through longstanding partnerships with advanced technology users like NASA, the Jet Propulsion Lab and others, our products and services make commercial battery powered products safer and electronics systems cooler and lighter.

In addition to KULR’s commitment to its Bitcoin Treasury Strategy (see “Our Bitcoin Acquisition Strategy” section below), KULR’s business model continues to evolve from being a component supplier, to providing more design and testing services to our customers.

The next step of evolution is to provide total system solutions to address market needs.

In order to scale up as a systems provider more quickly and efficiently in (i) the Li-ion battery energy storage and recycling markets, (ii) battery cell design and safety testing, and (iii) advanced thermal management systems, such as hypersonic vehicles, KULR will actively seek partners for joint venture, technology licensing and other strategic partnership models.

The goal is to leverage the Company’s thermal design technology expertise to create market leading products, which KULR will take to market directly to capture more value for KULR shareholders.

We have not yet achieved profitability and expect to continue to incur cash outflows from operations, and as a result, we will eventually need to generate significant revenues to achieve profitability.

Until that time, we may continue to raise cash, as and when required, through equity or debt financings.

KULR ONE and KULR ONE Design Solutions (K1DS)

KULR’s primary technical domain that is shaping the future landscape of the Company is safe, high-performance energy storage solutions.

To effectively support and provide energy storage solutions, a holistic approach is necessary.

Batteries are an interdisciplinary technology which require:

(1) Multi-disciplinary expertise to address related electrical, thermal, mechanical, and electrochemical requirements,

(2) Cell supply access to top-tier OEMs,

(3) Cell level testing capabilities to characterize performance, quality, and safety behavior at the cell level,

(4) Expertise in early concept design, modeling, and analysis,

(5) Rapid prototyping and production capabilities,

(6) Pack level thermal, mechanical, electrical, and abuse testing capabilities,

(7) Battery system-level testing and characterization,

(8) Expertise in battery management, controls, and monitoring,

(9) Ability to support beginning of life to end of life requirements for transport and recycling.

The implementation of a holistic approach resulted in the onboarding and development of a product and service portfolio over the course of the last decade that provides products, safety testing services, modeling and analysis services, electrical testing services, transport and recycling packaging and logistics, and battery design solutions.

Collectively, this is referred to as KULR ONE Design Solutions (K1-DS) , which is actively leveraged by the Company to facilitate engagement with customers no matter the battery life cycle phase they are in.

Currently, the primary aspects of K1-DS utilized by industry are product sales of trigger cells and TRS, the safety testing methodologies, and the utilization of the K1-DS platform as a whole to develop customized energy storage solutions.

Internally, KULR has leveraged K1-DS to develop off the shelf KULR ONE architecture which represent a groundbreaking innovation that is driving the world’s transition to a more sustainable electrification economy.

These revolutionary designs offer a unique combination of cutting-edge features, including unparalleled safety, exceptional performance, intelligent functionality, modular construction, reliability, and customizability.

The KULR ONE battery packs have been engineered to meet the exacting demands of the world’s most demanding applications.

As of now, the Company is focused on the KULR ONE Space for space exploration, the KULR ONE Guardian for military applications, and the KULR ONE Max for rack-style grid energy storage systems, also referred to as Battery Energy Storage Systems (BESS).

These architectures collectively offer a comprehensive solution that addresses the critical need for safe and reliable energy storage in a wide range of industries, from aerospace and defense to electric vehicles and consumer electronics.

One of the key features of the KULR ONE family of battery packs is the modularity and consistency of the architectures.

This allows for greater flexibility as customers can easily adjust the size and configuration of the battery pack to suit their specific application requirements while still also benefitting from testing previously conducted by the KULR team for their specific architecture.

In addition to offering exceptional performance and reliability, the KULR ONE battery packs are also designed with safety as a top priority.

They incorporate state-of-the-art thermal management technology to prevent overheating and ensure safe operation even in the most challenging environments.

Overall, the KULR ONE family of battery packs, depicted with the following picture, is at the forefront of the global drive towards sustainable electrification.

With its unparalleled combination of safety, performance, intelligence, modularity, reliability, and customizability, KULR ONE is positioned to revolutionize the way we think about energy storage and powering the world’s most demanding applications.

KULR Technology Group, Inc., through its wholly owned subsidiary KULR Technology Corporation, operates in two principal technology domains:

energy storage systems and robotics and artificial intelligence (“A.I.”).

Energy storage is the strategic core of our business and is anchored by the KULR ONE® platform.

The Company also provides leadership in the industrial robotics and A.I.

sectors through the distribution of the Exia exoskeleton systems.

This recent expansion to KULR’s offerings complements our technology portfolio by positioning KULR within emerging automation and human–machine interface markets.

In addition, KULR maintains commitment to its Bitcoin Treasury Strategy (see “Our Bitcoin Acquisition Strategy” section below), the benefits of which are leveraged to position KULR as a dominant leader in the energy storage and robotics & A.I.

Our expertise in energy storage systems originates from the Company’s legacy proprietary carbon fiber-based thermal interface materials engineered for applications requiring high thermal conductivity and low mass.

Building on this foundation of thermal expertise, the Company has expanded into a full battery system offering also known as the KULR ONE® platform as described with the figure below.

1 Infographic description of the KULR ONE® ecosystem.

The roadmap for the KULR ONE ® platform facilitates an ecosystem of energy storage related offerings consisting of the following:

space with K1 Space (K1S) , defense applications with K1 Guardian (K1G) , grid, UPS, and datacenter back-up with the K1 Max (K1M) , and drone, UAV, UAS, eVTOL with the K1 Air (K1A) .

Additionally, the Company continues to develop safety focused space and terrestrial battery management systems (BMS) with kBMS .

Lastly, for customers wishing to leverage KULR’s expertise and capabilities, but to apply to their own battery designs, the Company provides all design, test, manufacturing, and production services

under the KULR ONE ® Design Solutions (K1-DS) umbrella.

Off the shelf (OTS) energy storage related product lines, such as KULR’s trigger cells, thermal runaway shield (TRS), and SafeX safe storage solutions are also encompassed within K1-DS.

Within KULR engineering, this ecosystem integrates thermal design, cell selection, battery pack design, battery management systems development, environmental and abuse testing, and certification support.

Within KULR operations, it includes advanced manufacturing techniques and the strategic scaling of production capacity.

All battery-related engineering and operational activities are conducted under our AS9100-certified quality management system.

In summary, our energy storage efforts focus on the design, testing, and commercialization of safe, high-performance lithium-ion (“Li-ion”) battery systems for cross industry applications.

We develop technologies that address thermal management, battery safety, and the prevention of thermal runaway and cell-to-cell propagation—challenges that are critical to markets including aerospace, defense, commercial drones, electric mobility, stationary energy storage, and battery logistics.

KULR ONE ® Space

The KULR ONE Space (K1S) platform is the more mature of the KULR ONE architectures and is currently leveraged by multiple customers for upcoming space exploration missions which require energy storage with thermal runaway safe designs.

The K1S is built upon a passively propagation resistant and flame arresting (PPRFA) architecture.

This architecture, combined with KULR’s utilization of MOLICEL lithium-ion cells, provides one of the safest and highest performing off-the-shelf space flight battery designs available today.

The 400 series of the K1S platform serves as the first ever true commercial off-the-shelf offering of a 20793 rated battery.

Final certification is pending NASA’s approval processes associated with the Artemis II mission slated for 2026.

KULR Battery Management System (BMS) + AI = KULR Core TM

KULR’s path towards 20793 certification required the development of custom battery management system (BMS) technology built with radiation tolerant chipset.

The development of the BMS in multiple forms is nearing completion of qualification campaigns at which point they will be added to KULR’s product offering.

The ready to fly design posts radiation tolerance up to 75 kRad, 8 string control and passive balancing, and a listing of key safety features (e.g.

overcharge, overdischarge, overcurrent protections).

Moving forward, this BMS will serve as a foundation for KULR’s step into facilitating edge-AI for space applications.

The KULR ONE ® Space (K1S), as highlighted with the figure below, is a portfolio of modular, flight-ready battery platforms built to meet the extreme demands of spacecraft, satellites, and deep space missions.

It is available in three tailored configurations:

a JSC 20793-style thermal runaway propagation-safe architecture for maximum mission safety, a low-mass, low-volume standard flight battery design optimized for customer specific spacecraft requirements, and a simple cell arrangement variant engineered for seamless integration into customer-supplied housings and BMS systems.

All configurations leverage KULR’s heritage in thermal management, battery safety, and flight hardware.

K1S is fully modular, cell-agnostic, and rapidly customizable—dramatically reducing development time, qualification risk, and mission cost.

2 Images of (a) the 20793 (PPR) style K1S, (b) the low mass / low volume K1S, and (c) the simple cell arrangement style brick level K1S.

KULR ONE ® Guardian

The KULR ONE ® Guardian is a mission-specific, ruggedized adaptation of the KULR ONE ® platform built for military and defense applications where safety, survivability, and reliability under extreme conditions are mandatory.

Rather than a fixed product line, Guardian represents KULR’s bespoke battery architectures engineered to meet stringent standards such as NAVSEA S9310, MIL-STD-810H, and other service-specific shock, vibration, thermal, and ballistic requirements.

Guardian batteries typically integrate KULR’s passive propagation-resistant cell architecture, flame arresting thermal materials, and MIL-compliant electrical/mechanical design to ensure zero cell-to-cell propagation events as well as sustained performance in battlefield environments.

Guardian systems remain cell-agnostic and fully customizable , enabling rapid adaptation to any Department of War (DoW) application.

3 Image of KULR’s latest Guardian platform which is a 15 Ah 400 V system.

KULR ONE ® Max

The KULR ONE ® Max is a high-capacity battery platform engineered for grid energy storage, UPS systems, AI data center backup (BBU), and large-scale power infrastructure.

At its core is a cell-agnostic thermal architecture, derived from KULR’s spaceflight-proven KULR ONE ® Space platform, and designed to meet UL 9540/9540A requirements regardless of cell supplier or chemistry.

By applying space-grade safety techniques to terrestrial energy systems, it provides passive thermal runaway mitigation and cell-to-cell propagation resistance at rack and container scale.

Current development is centered around high-power 21700-format cell implementations and alignment with Open Rack V3 (ORV3) reference design standards to support rapid adoption in AI data centers.

The system scales from module to tray to rack and integrates with third-party BMS and EMS systems;

it supports NMC, LFP, high-silicon, and future chemistries with minimal redesign.

Built to meet UL 9540/9540A and global safety standards, KULR ONE ® Max delivers space-level safety and reliability to mission-critical and grid-level applications.

4 Image depicts (a) the 21700 based K1M variation for higher power applications and (b) the ORV3 based K1M architecture.

5 Example thermal runaway testing results demonstrating ability to perform multiple triggers without inducing cell-to-cell propagation;

a key requirement of UL9540A certification process.

KULR ONE ® Air

The KULR ONE ® Air is a purpose-built battery platform for unmanned aerial systems, loitering munitions, tactical ISR drones, and other high-demand defense aviation assets.

Modern high-discharge cells now outperform what traditional busbars, wiring, and connector systems can safely carry, creating new failure modes caused by overheated interconnects acting as resistance heaters against the cells.

K1A directly addresses this by engineering low-resistance current paths, increasing copper mass where needed, reducing busbar and wire temperatures, and preventing component-driven ignition that could lead to thermal runaway.

The result is an off-the-shelf pack price point with defense-grade engineering—capable of sustaining extreme C-rate discharge while extending time-on-station, enabling higher thrust profiles, and ensuring mission assurance in battlefield environments.

6 Depiction of the 6S4P K1A battery.

In parallel, variations of K1A are being developed for electric vertical takeoff and landing aircraft that require energy densities near 300 Wh kg⁻¹ packaged within DO-311–capable safety envelopes.

These architectures focus on delivering high energy per unit mass while still controlling thermal gradients, interconnect temperatures, and propagation risks during abuse or failure events.

The design maintains KULR’s emphasis on precise current path engineering, lightweight structural elements, and compatibility with aerospace-grade certification pathways.

This approach enables eVTOL manufacturers to balance endurance, payload capacity, and certification readiness without sacrificing safety or thermal stability.

KULR Battery Management System (kBMS)

The kBMS is KULR’s modular battery management system architecture, originally developed for spaceflight where radiation tolerance and multi-fault tolerance are critical for survival and mission longevity.

The space-rated version uses radiation-tolerant components tolerant up to 75 kRAD, 8 series string controls, operational amplifier–based logic instead of microprocessor-heavy designs, and redundant safety pathways to comply with standards such as NASA JSC 20793 and deep-space mission requirements.

Building on that heritage, a terrestrial variant of kBMS has been adapted for Department of War (DoW) and industrial applications, with a roadmap focused on maintaining core safety principles while supporting higher power profiles, faster telemetry, and integration with loitering munitions, unmanned systems, ground vehicles, and stationary power units.

Both versions remain cell-agnostic and are designed to interface directly with KULR ONE ® systems, providing precise balancing, state-of-charge estimation, and standard safety provisions.

7 Image of (a) the kBMS (Space) and (b) the in-house software graphical user interface (GUI).

kBMS + AI = KULR Core TM

The kBMS will serve as a foundation for KULR’s step into facilitating edge-AI for space applications.

KULR works to integrate the Company’s BMS, developed initially for space applications, with the Nvidia Jetson platform such that the processing and control of the BMS will be facilitated with the Jetson chipset.

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In addition to BMS functionality, the KULR Core TM will provide every user with a flight (or mission) computer and additional data processing capabilities with the leading chipset available.

8 Rendering of the KULR Core TM .

Additional targeted capabilities of the KULR Core TM include the following:

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The end result will be a mission autonomous spacecraft.

Battery Design and Analysis

For the technology domain of battery design and analysis, KULR provides custom batteries, batteries designed based on KULR ONE architectures (Space, Guardian and Air), and related off-the-shelf products (such as trigger cells, NASA WI37A screened cells, and TRS).

KULR ONE ® Design Solutions (K1-DS)

The final component to the ecosystem that is the KULR ONE ® platform is KULR ONE ® Design Solutions (K1-DS).

K1-DS serves as the Company’s engineering (and production)-as-a-service platform, enabling customers to leverage KULR’s advanced design, testing, and production infrastructure without immediately procuring a KULR-branded battery product.

Through K1-DS, KULR functions as an extension of the customer’s technical organization;

integrating concept design, modeling, analysis, and rapid prototyping with a level of safety and performance rigor typically reserved for aerospace and defense programs.

Strategically, the K1-DS model is designed to serve as a gateway to long-term production partnerships .

KULR selectively engages in K1-DS programs that demonstrate alignment with the Company’s core domains;

high-performance, safety-critical energy storage for aerospace, defense, industrial, and commercial electrification markets.

These projects are pursued not as one-off consulting efforts, but as early-stage co-development opportunities intended to mature into recurring production contracts for customer-specific energy storage systems built within KULR’s manufacturing infrastructure.

The K1-DS framework provides a holistic approach (see Fig.

9) to battery system development, supported by the Company’s vertically integrated capabilities, including:

Multi-disciplinary Expertise:

Integrated electrical, thermal, mechanical, and electrochemical design and analysis.

Tier-One Cell Access:

Direct sourcing partnerships with leading cell OEMs to ensure quality, consistency, and scalability.

Cell-Level Characterization:

Advanced in-house testing to evaluate performance, quality, and safety under diverse profiles.

Concept Development & Simulation:

Digital modeling to optimize architecture, pack geometry, and energy density.

Rapid Prototyping:

Agile build capability for proof-of-concept and pilot-scale validation.

Pack-Level Qualification:

Mechanical, electrical, and abuse testing aligned with UN 38.3, UL 9540A, DO-311, and NASA 20793 protocols.

System-Level Integration:

Validation of battery management systems, control logic, and communication interfaces.

Lifecycle Support:

Compliance, transport, and recycling support from concept through end-of-life.

By carefully selecting K1-DS engagements that align with its strategic growth roadmap, KULR converts early design partnerships into long-term revenue channels, transitioning from engineering services to recurring production supply of customer-specific energy storage systems .

This disciplined approach expands the Company’s reach across emerging electrification markets while reinforcing its core mission:

to deliver safe, high-performance, and scalable energy solutions through the KULR ONE ® platform.

9 Holistic approach for life cycle of energy storage systems.

Overview of Direct Product and Service Offerings

Within the core technology domain of battery design and analysis, KULR provides custom batteries, batteries designed based on KULR ONE ® architectures (Space, Guardian and Air), and related off-the-shelf products (such as trigger cells, NASA WI37A screened cells, and TRS).

These product and service offerings are outlined with the following figure.

Cell and Battery Testing

10 Battery design and analysis product and service offerings.

Overview of Cell and Battery Testing Service Offerings

KULR has invested heavily in an expansive cell and battery testing suite of services over the last 3 years.

Testing capabilities are grouped between abuse testing, electrical testing, and environmental testing and are reflected with the following figure.

11 Cell and battery testing service offerings.

Battery Production

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KULR’s battery component fabrication and assembly production capabilities are highlighted with the following figure.

12 Battery production related offerings.

KULR VIBE Solution

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● Power tools and industrial equipment

● High-performance electric vehicles

● High-performance electric mobility

● Electric vertical take-off and landing (“eVOTL”)

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KULR’s Thermal Runaway Shield (TRS) technology is trusted by NASA to ship and store astronauts’ laptop batteries on the International Space Station.

KULR is serving a total addressable market for a circular economic model for batteries that will reach over $21 billion by 2025 (estimated based on market data projections published by Grand View Research, Inc.

KULR is serving a total addressable market for a circular economic model for batteries that will reach over $77 billion by 2034 (estimated based on market data projections published by Allied Market Research, Inc.

stating that the global battery recycling market size is expected to reach $77.1 billion by 2034).

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The electronic devices being placed into aircrafts, satellites, and missiles are becoming ever smaller and more powerful.

Lithium-ion batteries, which are already prone to overheating and propagation, are exposed to harsh thermal environments as well as shock and vibration during aerospace and defense operations.

Lithium-ion batteries, which are already prone to overheating and propagation, are exposed to harsh thermal

environments as well as shock and vibration during aerospace and defense operations.

The Company has partnered with Lockheed Martin, Leidos and other prime contractors to develop and supply mission-critical technologies for hypersonic vehicles, high-power magnetic wave, and other defense systems.

Recent Developments

Investments, Impairment and Credit Losses

During the nine months ended September 30, 2025, the Company made two investments in a private German entity (the “Investee”), including Series A7 Preferred Shares and a convertible loan receivable of $3,325,045 and $1,832,690, respectively.

On October 28, 2025, the Company loaned an additional $294,875 to the Investee pursuant to the convertible loan agreement.

In addition, the Company had accounts receivable of $780,643 due from Investee, who was also a customer.

On November 13, 2025, the Investee filed an application with a German insolvency court to open insolvency proceedings.

As a result, as of September 30, 2025, the Company has fully impaired or recognized credit losses associated with the Company’s investments and accounts receivable associated with the Investee.

Bitcoin Treasury Strategy

During the three months ended June 30, 2025, the Company purchased 244.36 Bitcoin via trade orders on Coinbase (the prime broker), at an average cost of $103,949 per Bitcoin, inclusive of fees and expenses, for an aggregate cost of $25,400,657.

During the six months ended June 30, 2025, the Company purchased 693.81 Bitcoin via trade orders on Coinbase at an average cost of $100,748 per Bitcoin, inclusive of fees and expenses, for an aggregate cost of $69,900,009.

During the three months ended September 30, 2025, the Company purchased 90.00 Bitcoin via trade orders on Coinbase (the prime broker), at an average cost of $108,889 per Bitcoin, inclusive of fees and expenses, for an aggregate cost of $9,799,993.

During the nine months ended September 30, 2025, the Company purchased 783.81 Bitcoin via trade orders on Coinbase at an average cost of $101,683 per Bitcoin, inclusive of fees and expenses, for an aggregate cost of $79,700,002.

On March 7, 2025, the Company entered into a sixty-day lease agreement (the “First Machine Lease Agreement”) with a bitcoin mining services company to operate 2,500 S-19 bitcoin mining machines on KULR’s behalf, at a total lease cost of $850,000.

Additionally, on May 16, 2025, the Company entered into a two hundred and twenty eight-day lease agreement (the “Second Machine Lease Agreement”) with the same digital asset mining services company to operate the 2,500 digital assets mining machines on KULR’s behalf, at a total lease cost of $3,200,000.

Furthermore, on June 20, 2025, the Company entered into a one hundred and three-day lease agreement (the “Third Machine Lease Agreement”) with a new digital asset mining services company to operate 3,570 Bitmain Antminer S19 digital assets mining machines on KULR’s behalf, at a total lease cost of $2,756,795.

Additionally, on July 30, 2025, the Company entered into a three hundred and sixty five day lease agreement (the “Fourth Machine Lease Agreement”) to operate 1,157 MicroBT Whatsminer M30S++ bitcoin mining machines on KULR’s behalf, at a total lease cost of $2,646,250.

Through June 30, 2025, 17.29 bitcoin have been earned pursuant to the Machine Lease Agreements, at an average value of $97,685 per bitcoin.

During the period from July 1, 2025 through August 12, 2025, the Company purchased 90.0 Bitcoin, at an average cost of $108,889 per Bitcoin, and earned 17.69 Bitcoin from mining services.

On May 16, 2025, the Company entered into a two hundred and twenty eight-day lease agreement (the “Second Machine Lease Agreement”) with the same digital asset mining services company to operate the 2,500 digital assets mining machines on KULR’s behalf, at a total lease cost of $3,200,000.

On June 20, 2025, the Company entered into a one hundred and three-day lease agreement (the “Third Machine Lease Agreement”) with a new digital asset mining services company to operate 3,570 Bitmain Antminer S19 digital assets mining machines on KULR’s behalf, at a total lease cost of $2,756,795.

On July 30, 2025, the Company entered into a three hundred and sixty five day lease agreement (the “Fourth Machine Lease Agreement”) to operate 1,157 MicroBT Whatsminer M30S++ bitcoin mining machines on KULR’s behalf, at a total lease cost of $2,646,250.

On October 1, 2025, the Company entered into a two year lease agreement (the “Fifth Machine Lease Agreement”) to operate 1,296 bitcoin mining machines on KULR’s behalf, at a total lease cost of $4,220,000.

Through September 30, 2025, 55.70 bitcoin have been earned pursuant to the Machine Lease Agreements, at an average value of $109,254 per bitcoin.

During the period from October 1, 2025 through November 14, 2025, the Company has earned 7.43 Bitcoin from mining services.

See the section “Our Bitcoin Acquisition Strategy” below for further information regarding our Bitcoin purchases, including the source of capital used to purchase Bitcoin.

At the Market Offering

On January 24, 2025, the Company increased the maximum aggregate at the market (“ATM”) offering amount of the shares of the Company’s common stock issuable under the ATM by an additional $50 million, bringing the total aggregate offering amount to $146

On May 30, 2025, the Company completed its initial ATM agreement with a total of 14,783,393 shares issued for gross proceeds of $146 million.

On June 9, 2025, the Company entered into a second At the Market Offering agreement (the “second ATM Agreement”) with an agent (the “Agent”), pursuant to which the Company may, from time to time, sell shares of common stock for aggregate gross proceeds of up to $300 million in ATM offerings through or to the Agent.

At the Market Offerings

On January 24, 2025, the Company increased the maximum aggregate offering amount of the shares of the Company’s common stock issuable under the at the market agreement (“First ATM Agreement”) by an additional $50 million, bringing the total aggregate offering amount to $146 million.

On May 30, 2025, the Company completed its initial ATM offering pursuant to the First ATM Agreement with a total of 14,783,393 shares issued for gross proceeds of $146 million, of which 9,347,644 shares were issued and gross proceeds of $61.9 million were received in 2024 pursuant to the First ATM agreement.

On June 9, 2025, the Company entered into a second At the Market Offering agreement (the “Second ATM Agreement”) with a sales agent (the “Agent”), pursuant to which the Company may, from time to time, sell shares of common stock for aggregate gross proceeds of up to $300 million in ATM offerings through or to the Agent.

On September 30, 2025, the Company reduced the aggregate offering amount to $150 million.

Sales of the shares of common stock, if any, will be made at prevailing market prices at the time of the sale, or as otherwise agreed with the Agent.

The Agent will receive a commission from the Company of up to 3.0% of the gross proceeds of any shares of common stock sold pursuant to the ATM Agreement.

During the six months ended June 30, 2025, the Company issued a total of 6,258,415 shares of common stock pursuant to the ATMs for aggregate gross proceeds of $89,484,074.

During the period from July 1, 2025 through August 12, 2025, the Company issued 1.6 million shares of common stock for gross proceeds of $10.7 million pursuant to the ATM.

The Agent will receive a commission from the Company of up to 3.0% of the gross proceeds of any shares of common stock sold pursuant to the Second ATM Agreement.

During the nine months ended September 30, 2025, the Company issued a total of 9,420,337 shares of common stock pursuant to the ATM Agreements for aggregate gross proceeds of $107,311,618, with cash issuance costs of $2,685,424.

During the period from October 1, 2025 through November 14, 2025, the Company issued 3.0 million shares of common stock for gross proceeds of $15.1 million pursuant to the Second ATM Agreement.

Issuance of Non-Convertible Series A Voting Preferred Stock

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The Independent Members of the Board have determined that the issuance represents a pivotal strategic move to reinforce and enhance the Company’s flexibility to optimize the Company’s negotiating position in any potential current and/or future engagements with commercial, financial, and/or strategic parties, and to provide defenses against potential hostile third-party actions.

Appointment of New Directors

Effective June 6, 2025, the Board increased the number of directors to five and appointed Messrs.

Shawn Canter and Aron Schwartz to serve as members of the Board.

Canter and Schwartz will serve as members of the Board until the next annual meeting of the Company’s stockholders, and until their successors are elected and qualified or until their earlier death, resignation or removal.

In addition, Mr.

Schwartz was appointed as the Chair of the Board’s Compensation Committee and a member of each of the Audit Committee and Nominating and Corporate Governance Committee.

In connection with Mr.

Schwartz’ appointment, the Company agreed to pay Mr.

Schwartz cash compensation equal to $95,000 per year and to issue 13,130 restricted stock units (“RSUs”) of the Company’s common stock, which shares shall vest in two equal increments every six months following June 6, 2025, subject to Mr.

Schwartz’s continued service with the Company through each applicable vesting date and such RSUs becoming issuable upon the Company’s shareholder approval of a new equity incentive plan.

Canter will not receive additional compensation for his duties on the Board.

Non-Executive Director Compensation

Effective June 6, 2025, the Board of Directors of the Company approved a cash compensation adjustment and the grant of restricted stock units to the non-executive members of the Board as follows:

Joanna Massey, the Company’s Lead Director, cash compensation equal to $120,000 per year and to issue 13,130 RSUs of the Company’s common stock, which shares shall vest in two equal increments every six months following June 6, 2025, subject to Ms.

Massey’s continued service with the Company through each applicable vesting date and such RSUs becoming issuable upon the Company’s shareholder approval of a new equity incentive plan;

Donna Grier, the Company’s Audit Committee chair, cash compensation equal to $97,500 per year and to issue 13,130 RSUs of the Company’s common stock, which shares shall vest in two equal increments every six months following June 6, 2025, subject to Ms.

Grier’s continued service with the Company through each applicable vesting date and such RSUs becoming issuable upon the Company’s shareholder approval of a new equity incentive plan.

Reverse Stock Split

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Each Loan will be documented by a written confirmation setting forth the asset type, principal amount, loan fee rate, maturity profile and any other negotiated terms.

The Master Loan Agreement provides for a multiple-draw term facility, with no fixed aggregate cap on the amount that can be borrowed.

The Master Loan Agreement provides for a multiple-draw term facility up to $20 million.

A Loan shall only be deemed to commence once the Lender transfers the Loaned Assets to the Company;

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The Initial Drawdown bears an 8% loan fee.

The Company’s obligations are secured by a first-priority security interest at collateral-coverage ratio of about 156.25% of the outstanding principal amount, or 166 BTC.

The Company’s obligations are secured by a first-priority security interest at a collateral-coverage ratio of about 156.25% of the outstanding principal amount.

The Initial Drawdown is subject to the terms and conditions of the Master Loan Agreement.

As of September 30, 2025, the balance on the loan was $3.8 million, which was repaid in full on October 15, 2025.

Mining Operations

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This deployment underscores KULR’s dual acquisition strategy of both mining Bitcoin and purchasing it on the open market.

On October 1, 2025, the Company entered into a two year lease agreement (the “Fifth Machine Lease Agreement”) with a digital asset mining services company to operate digital assets mining machines on KULR’s behalf, at a total lease cost of $4.2 million.

Retirement of Executive Officer

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Carpenter, resigned from all positions of the Company in connection with his planned retirement.

Carpenter’s decision to retire was not due to any disagreement with the Company on any matter relating the Company’s operations, policies, or practices.

Carpenter’s decision to retire was not due to any disagreement with the Company on any matter relating to the Company’s operations, policies, or practices.

Carpenter served as KULR’s Vice President of Engineering since June 2017.

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Results of Operations

Three and Six Months Ended June 30, 2025, Compared With Three and Six Months Ended June 30, 2024

Three and Nine Months Ended September 30, 2025, Compared With Three and Nine Months Ended September 30, 2024

For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

September 30,

Product sales

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Mining of digital assets

Grant revenue

Total Revenue

For the three months ended June 30, 2025 and 2024, we generated $3,972,997 and $2,432,005 of revenues from 30 and 27 customers, respectively, representing an increase of $1,540,992, or 63%.

For the six months ended June 30, 2025 and 2024, we generated $6,421,603 and $4,181,109 of revenues from 43 and 48 customers, respectively, representing an increase of $2,240,494, or 54%.

Revenue from product sales during the three months ended June 30, 2025, increased by $843,297 or 74% compared to the three months ended June 30, 2024.

We had 25 product sales customers in the second quarter of 2025, compared with 15 in the second quarter of 2024.

Product sales during these periods include sales of our component product, carbon fiber velvet (“CFV”) thermal management solution, internal short circuit battery cells and devices, patented TRS technology, thermal fiber thermal interface materials, KULR SafeCases,

and exoskeleton devices.

The increase in revenue was driven primarily by contracts with two new customers we did not have contracts with during the three months ended June 30, 2024.

Revenue from product sales during the six months ended June 30, 2025, increased by $1,388,763 or 79% compared to the six months ended June 30, 2024.

We had 32 product sales customers in the first six months of 2025, compared with 36 in the first six months of 2024.

For the three months ended September 30, 2025 and 2024, we generated $6,884,840 and $3,185,778 of revenues from 33 and 38 customers, respectively, representing an increase of $3,699,062, or 116%.

For the nine months ended September 30, 2025 and 2024, we generated $13,306,443 and $7,366,887 of revenues from 67 and 78 customers, respectively, representing an increase of $5,939,556, or 81%.

Revenue from product sales during the three months ended September 30, 2025, increased by $859,728 or 112% compared to the three months ended September 30, 2024.

We had 18 product sales customers in the third quarter of 2025, compared with 20 in the third quarter of 2024.

Although the number of customers period over period was relatively consistent, the increase in revenue was primarily driven by our new client base generating more significant revenue per contract during the three months ended September 30, 2025, as compared to the same period in 2024.

Additionally, there was a significant increase in revenue generated from one of the Company’s existing customers.

Revenue from product sales during the nine months ended September 30, 2025, increased by $2,248,491 or 89% compared to the nine months ended September 30, 2024.

We had 36 product sales customers in the first nine months of 2025, compared with 47 in the first nine months of 2024.

Although the number of customers decreased, the increase in revenue was driven primarily by contracts with three new customers we did not have contracts with during the six months ended June 30, 2024.

Revenue from contract services during the three months ended June 30, 2025, decreased by $741,400 or 57% compared to the three months ended June 30, 2024.

The decrease in revenue is primarily due to two large contracts earned in the second quarter of 2024 for which generated $681,736 of service revenues.

We had 12 contract services customers in the second quarter of 2025, compared with 14 in the second quarter of 2024.

Although the number of customers decreased, the increase in revenue was driven primarily by our new client base generating more significant revenue per contract during the nine months ended September 30, 2025, as compared to the same period in 2024.

Additionally, there was a significant increase in revenue generated from one of the Company’s existing customers.

Revenue from contract services during the three months ended September 30, 2025, decreased by $1,029,534 or 74% compared to the three months ended September 30, 2024.

The decrease in revenue is primarily due to five large contracts earned in the third quarter of 2024 which generated $1,028,063 of service revenues that did not recur in the 2025 period.

We had 13 contract services customers in the third quarter of 2025, compared with 17 in the third quarter of 2024.

Service revenue includes unique engineering design and testing projects customized for specific customers.

Revenue from contract services during the six months ended June 30, 2025, decreased by $837,118 or 34% compared to the six months ended June 30, 2024.

We had 23 contract services customers in the first six months of 2025, compared with 21 in the first six months of 2024.

The decrease in revenue is primarily due to 7 large contracts earned during 2024 which generated $1,643,751 of service revenues.

Revenue from contract services during the nine months ended September 30, 2025, decreased by $1,866,652 or 49% compared to the nine months ended September 30, 2024.

We had 30 contract services customers in the first nine months of 2025, compared with 30 in the first nine months of 2024.

The decrease in revenue is primarily due to a large contract earned during 2024 which generated $678,040 of service revenues, along with a significant reduction in two other contracts in 2025.

Service revenue includes unique engineering design and testing projects customized for specific customers.

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Accordingly, the business activity cycle between expression of initial customer interest to shipping, acceptance and billing can be lengthy, unpredictable, and lumpy, which can influence the timing, consistency and reporting of sales growth.

Revenue from mining digital assets during the three and six months ended June 30, 2025, was $1,439,095 and $1,688,849, respectively.

The initial mining contract was entered into on March 7, 2025 and expanded throughout the second quarter of 2025, as previously described.

For the six months ended June 30, 2025, we earned 17.28 bitcoin from mining operations.

Revenue from mining digital assets during the three and nine months ended September 30, 2025, was $4,396,603 and $6,085,452, respectively.

The initial mining contract was entered into on March 7, 2025 and mining activities increased through September 30, 2025, with additional leases being executed during the period.

Two new mining contracts were entered into during the second quarter of 2025, and we entered into a fourth mining contract in the third quarter of 2025.

For the nine months ended September 30, 2025, we earned 55.70 bitcoin from mining operations.

There was no mining of digital assets revenue recognized prior to March 7, 2025.

Grant revenue during the three and nine months ended September 30, 2025, was $501,032, for the reimbursement of equipment purchases totaling $255,728, and R&D expense totaling $245,304.

Grant revenue consists of an award from the state of Texas to perform research and development of cold-temperature lithium-ion battery solutions for the next generation of Lunar and Martian missions which is part of our ongoing major or central activities.

The contract award was executed during the three months ended September 30, 2025.

Revenue is earned on the award to reimburse approved expenses incurred by the Company.

There was no grant revenue recognized prior to this period.

Cost of Revenue, Gross Profit and Gross Profit Margin

Cost of revenue consisted of the cost of our products, labor expenses directly related to product sales or contract services, and lease costs incurred pursuant to the Machine Lease Agreement in connection with mining digital assets.

Product mix plays an important part in our reported average margins for any period.

Because we are introducing new products and contract services at an early stage in our development cycle the margins earned can vary significantly between periods, customers, products and services due to the learning process, customer negotiating strengths, and product mix.

For the three months ended June 30, 2025 and 2024, cost of revenues was $3,259,287 and $1,859,377, respectively, representing an increase of $1,399,910 or 75%.

For the three months ended June 30, 2025 and 2024, gross profit was $713,710 and $572,628, respectively, an increase of $141,082 or 25%.

Our gross profit margins were 18% and 24% during the three months ended June 30, 2025 and 2024, respectively.

The decrease in the current period profit margin resulted primarily from increased hours spent on service contracts and an increase in costs related to digital assets mining leases.

For the three months ended June 30, 2025, our gross profit margins for product sales, contract services and digital assets mining were 49%, (48%), and 1%, respectively.

For the three months ended June 30, 2024, our gross profit margins for product sales and contract services were 18% and 28%, respectively.

For the three months ended September 30, 2025 and 2024, cost of revenues was $6,255,960 and $928,326, respectively, representing an increase of $5,327,634 or 574%.

For the three months ended September 30, 2025 and 2024, gross profit was $628,880 and $2,257,452, respectively, a decrease of $1,628,572 or 72%.

Our gross profit margins were 9% and 71% during the three months ended September 30, 2025 and 2024, respectively.

The decrease in the current period profit margin resulted primarily from increased hours spent on service contracts, non-recognition of revenue related to product sales to our Investee due to their financial condition, and an increase in costs related to digital assets mining leases.

For the three months ended September 30, 2025, our gross profit margins for product sales, contract services and digital assets mining were 6%, (47%), and 5%, respectively.

For the three months ended September 30, 2024, our gross profit margins for product sales and contract services were 73% and 48%, respectively.

There was no revenue from digital assets mining during 2024.

For the six months ended June 30, 2025 and 2024, cost of revenues was $5,501,548 and $3,097,692, respectively, representing an increase of $2,403,856 or 78%.

For the six months ended June 30, 2025 and 2024, gross profit was $920,055 and $1,083,417, respectively, a decline of $163,362 or 15%.

Our gross profit margins were 14% and 26%, during the six months ended June 30, 2025 and June 30, 2024, respectively.

The decrease in the current period gross profit margin resulted primarily from increased hours spent on service contracts and an increase in costs related to digital assets mining leases.

For the six months ended June 30, 2025 and 2024, our gross profit margins for product sales, contract services and digital assets mining were 59%, (54%), and (4%), respectively.

For the six months ended June 30, 2024, our gross profit margins for product sales and contract services were 11% and 37%, respectively.

For the nine months ended September 30, 2025 and 2024, cost of revenues was $11,757,508 and $4,026,018, respectively, representing an increase of $7,731,490 or 192%.

For the nine months ended September 30, 2025 and 2024, gross profit was $1,548,935 and $3,340,869, respectively, a decline of $1,791,934 or 54%.

Our gross profit margins were 12% and 45%, during the nine months ended September 30, 2025 and September 30, 2024, respectively.

The decrease in the current period gross profit margin resulted primarily from increased hours spent on service contracts, non-recognition of revenue related to product sales to our Investee due to their financial condition, and an increase in costs related to digital assets mining leases.

For the nine months ended September 30, 2025, our gross profit margins for product sales, contract services and digital assets mining were 39%, (49%), and 2%, respectively.

For the nine months ended September 30, 2024, our gross profit margins for product sales, contract services and IP licensing agreement were 30%, 41% and 100%, respectively.

Research and Development

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Research and development expenses are charged to operations as incurred.

For the three months ended June 30, 2025 and 2024, R&D expenses were $2,436,754 and $1,305,186, respectively, representing an increase of $1,131,568 or 87%.

The increase was comprised primarily due to planned increases in R&D services and new hires in 2025, and an increase in stock-based compensation from additional awards granted in 2025.

For the six months ended June 30, 2025 and 2024, R&D expenses were $4,886,654 and $2,259,811, respectively, representing an increase of $2,626,843 or 116%.

The increase was primarily attributable to planned increases in R&D services and new hires in 2025, and an increase in stock-based compensation from new awards granted in 2025.

For the three months ended September 30, 2025 and 2024, R&D expenses were $2,323,010 and $1,232,333, respectively, representing an increase of $1,090,677 or 89%.

The increase is primarily due to planned increases in R&D services and new hires in 2025, and an increase in stock-based compensation from additional awards granted in 2025.

For the nine months ended September 30, 2025 and 2024, R&D expenses were $7,209,664 and $3,492,144, respectively, representing an increase of $3,717,520 or 106%.

The increase is primarily attributable to planned increases in R&D services and new hires in 2025, and an increase in stock-based compensation from new awards granted in 2025.

We expect that our R&D expenses will increase as we expand our future operations.

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Selling, general and administrative expenses consisted primarily of stock-based compensation, marketing and advertising, salaries, payroll taxes and other benefits, Board compensation, accounting and tax, consulting fees, travel and entertainment, rent expense, office expenses, and legal and professional fees.

For the three months ended June 30, 2025 and 2024, selling, general and administrative expenses were $6,941,599 and $4,594,500, respectively, representing an increase of $2,347,099 or 51%.

For the three months ended September 30, 2025 and 2024, selling, general and administrative expenses were $6,263,803 and $2,735,419, respectively, representing an increase of $3,528,384 or 129%.

The increase is primarily due to planned investments to support our growth related activities, including additional advertising and marketing services, professional and consulting fees, and increased salaries and stock-based compensation from new hires and new grants awarded in 2025.

For the six months ended June 30, 2025 and 2024, selling, general and administrative expenses were $13,573,072 and $8,807,401, respectively, representing an increase of $4,765,671 or 54%.

For the nine months ended September 30, 2025 and 2024, selling, general and administrative expenses were $19,836,875 and $11,542,820, respectively, representing an increase of $8,294,055 or 72%.

The increase is primarily due to planned investments in growth related activities that we anticipate will accelerate our growth going forward, including additional advertising and marketing services, professional and consulting fees, travel related expenses, and increased salaries and stock-based compensation from new hires and new grants awarded in 2025.

Impairment Expense

For the three and six months ended June 30, 2025, impairment expenses were $786,397 and $1,355,174, respectively, due to the write-off of equipment deposits.

There were no impairment expenses for the three and six months ended June 30, 2024.

Credit Losses on Accounts Receivable

For the three and nine months ended September 30, 2025, bad debt expenses were $780,643 and $780,643, respectively, due to the write-off of accounts receivable associated with our Investee, due to their financial condition.

There were no bad debt expenses for the three and nine months ended September 30, 2024.

Impairment of Equipment Deposits

For the three and nine months ended September 30, 2025, impairment of equipment deposits were $0 and $1,355,174, respectively, due to the write-off of equipment deposits.

There were no impairment expenses for the three and nine months ended September 30, 2024.

Other Income (Expense)

For the three months ended June 30, 2025 and 2024, other income (expense), net was $17,593,189 and $(563,470), respectively, representing an increase of $18,156,659.

The change is primarily attributable to the $17,367,660 unrealized gain on Bitcoin holdings due to the three-month change in market price of Bitcoin from $82,560 on March 31, 2025, to $107,176 on June 30, 2025, a decrease of $527,199 for amortization of debt discount in connection with merchant cash advances, an increase of $168,975 from interest earned from the licensing agreements, an increase of $61,415 for the change in fair value of accrued issuable equity, and a decrease of $31,410 in interest expense due to the full repayment of the prepaid advance liability on March 27, 2024.

For the six months ended June 30, 2025 and 2024, other income (expense), net, was $8,230,336 and $(915,609), respectively, representing an increase of $9,145,945.

The change is primarily attributable to the $7,619,060 unrealized gain on Bitcoin holdings due to the six-month change in market price of Bitcoin, from $93,384 on December 31, 2024, to $107,176 on June 30, 2025, a decrease of $619,398 for amortization of debt discount in connection with merchant cash advances, an increase of $337,399 from interest earned from the licensing agreements, an increase of $335,015 for the change in fair value of accrued issuable equity, a decrease of $153,715 in interest expense due to the full repayment of the prepaid advance liability on March 27, 2024, and an increase of $81,358 from the gain on debt extinguishment.

For the three months ended September 30, 2025 and 2024, other income (expense), net was $1,764,661 and $(293,464), respectively, representing an increase of $2,058,125.

The change is primarily attributable to the $6,837,563 unrealized gain on Bitcoin holdings due to the three-month change in market price of Bitcoin from $107,176 on June 30, 2025, to $114,057 on September 30, 2025, a decrease of $278,013 for amortization of debt discount in connection with merchant cash advances, and an increase of $76,378 for the change in fair value of accrued issuable equity, partially offset by a $3,325,045 impairment of an equity investment and $1,832,690 for a credit loss on a convertible loan receivable.

For the nine months ended September 30, 2025 and 2024, other income (expense), net, was $9,994,997 and $(1,209,073), respectively, representing an increase of $11,204,070.

The change is primarily attributable to the $14,456,623 unrealized gain on Bitcoin holdings due to the nine-month change in market price of Bitcoin, from $93,384 on December 31, 2024, to $114,057 on September 30, 2025, a decrease of $897,411 for amortization of debt discount in connection with merchant cash advances, an increase of $467,807 from interest earned from the savings account, licensing agreements and loan receivable, an increase of $411,393 for the change in fair value of accrued issuable equity, a decrease of $47,213 in interest expense due to the full repayment of the prepaid advance liability on March 27, 2024, and an increase of $81,358 from the gain on debt extinguishment, partially offset by a $3,325,045 impairment of an equity investment and $1,832,690 for a credit loss on a convertible loan receivable.

Our Bitcoin Acquisition Strategy

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Through June 30, 2025, 17.29 bitcoin have been earned pursuant to the Machine Lease Agreements, at an average value of $97,685 per bitcoin.

The following table presents bitcoin activity during the six months ended June 30, 2025.

Furthermore, on July 30, 2025, the Company entered into a one year lease agreement (the “Fourth Machine Lease Agreement”) with a digital asset mining services company to operate digital assets mining machines on KULR’s behalf, at a total lease cost of $2,646,250.

Through September 30, 2025, 55.70 bitcoin have been earned pursuant to the Machine Lease Agreements, at an average value of $109,254 per bitcoin.

The following table presents bitcoin activity during the nine months ended September 30, 2025.

Digital Assets (1)

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Change in fair value of digital assets

Fair value as of June 30, 2025

Fair value as of September 30, 2025

(1) The source of capital used to purchase Bitcoin was primarily proceeds from ATM offerings.

Liquidity and Capital Resources

As of June 30, 2025 and December 31, 2024, we had cash balances of $20,570,108 and $29,831,858, respectively, and working capital of $27,303,994 and $29,498,421, respectively.

As of June 30, 2025 and December 31, 2024, we also had Bitcoin holdings of $99,489,102 and $20,281,184, respectively.

For the six months ended June 30, 2025 and 2024, net cash used in operating activities was $21,720,717 and $9,198,453, respectively.

Our net cash used in operations for the six months ended June 30, 2025, was primarily attributable to our net loss of $10,664,509, adjusted for non-cash gains in the aggregate amount of $4,156,178, plus $6,900,030 of net cash used to fund changes in the levels of operating assets and liabilities.

Our net cash used in operations for the six months ended June 30, 2024, was primarily attributable to our net loss of $10,899,404, adjusted for non-cash expenses in the aggregate amount of $3,970,681, plus $2,269,730 of net cash used to fund changes in the levels of operating assets and liabilities.

For the six months ended June 30, 2025 and 2024, net cash used in investing activities was $73,637,042 and $163,023, respectively.

Net cash used in investing activities during the six months ended June 30, 2025, was related to investments in digital assets of $69,900,009, investment in preferred stock of $3,325,045, purchases of property and equipment of $334,648, and deposits paid for purchases of property and equipment of $77,340.

Net cash used in investing activities during the six months ended June 30, 2024, was related to purchases of property and equipment.

For the six months ended June 30, 2025 and 2024, net cash provided by financing activities was $86,096,009 and $9,183,655, respectively.

Net cash provided by financing activities during the six months ended June 30, 2025, was primarily due to net proceeds from ATM equity financing totaling $89,484,074, partially offset by issuance costs on ATM equity financing of $2,239,735, notes payable repayments of $577,674, and payments for deferred financing costs of $577,000.

Net cash provided by financing activities during the six months ended June 30, 2024, was due to proceeds from SEPA Advance Notices totaling $9,104,950, and net proceeds from notes payable totaling $1,730,000, partially offset by notes payable repayments of $1,525,195 and issuance costs on notes payable of $126,100.

Future cash requirements for our current liabilities include approximately $3,044,167 for accounts payable and accrued expenses and $493,061 for future payments under operating and finance leases.

As of September 30, 2025 and December 31, 2024, we had cash balances of $20,588,596 and $29,831,858, respectively, and working capital of $21,599,040 and $29,498,421, respectively.

As of September 30, 2025 and December 31, 2024, we also had Bitcoin holdings of $120,523,261 and $20,281,184, respectively.

For the nine months ended September 30, 2025 and 2024, net cash used in operating activities was $31,039,539 and $12,498,818, respectively.

Our net cash used in operations for the nine months ended September 30, 2025, was primarily attributable to our net loss of $17,638,424, adjusted for non-cash gains in the aggregate amount of $7,761,655, which includes impairment of an equity investment and credit loss on convertible loan receivable of $3,325,045 and $1,832,690, respectively, plus $5,639,460 of net cash used to fund changes in the levels of operating assets and liabilities.

Our net cash used in operations for the nine months ended September 30, 2024, was primarily attributable to our net loss of $12,903,168, adjusted for non-cash expenses in the aggregate amount of $4,721,844, plus $4,317,494 of net cash used to fund changes in the levels of operating assets and liabilities.

For the nine months ended September 30, 2025 and 2024, net cash used in investing activities was $85,499,202 and $211,005, respectively.

Net cash used in investing activities during the nine months ended September 30, 2025, was related to investments in digital assets of $79,700,002, investment in preferred stock of $3,325,045, issuance of convertible loan receivable of $1,832,690,

purchases of property and equipment of $581,702, and deposits paid for purchases of property and equipment of $59,763.

Net cash used in investing activities during the nine months ended September 30, 2024, was related to purchases of property and equipment of $188,267 and deposits paid for purchases of property and equipment of $22,738.

For the nine months ended September 30, 2025 and 2024, net cash provided by financing activities was $107,295,479 and $12,427,476, respectively.

Net cash provided by financing activities during the nine months ended September 30, 2025, was primarily due to proceeds from ATM equity financings totaling $107,311,618, proceeds from the loan payable totaling $8,000,000, partially offset by loan payable repayments of $4,200,000, issuance costs on ATM equity financing of $2,685,424, notes payable repayments of $577,674, and payments for deferred financing costs of $562,016.

Net cash provided by financing activities during the nine months ended September 30, 2024, was primarily due to proceeds from SEPA Advance Notices totaling $9,104,950, proceeds from ATM equity financings totaling $3,431,090, proceeds from notes payable totaling $2,730,000, partially offset by notes payable repayments of $2,439,855, issuance costs on notes payable of $166,100, payments for deferred financing costs of $128,041, and issuance costs on ATM equity financings of $103,718.

Future cash requirements for our current liabilities include approximately $2,537,896 for accounts payable and accrued expenses, $3,800,000 for loan payable and $416,962 for future payments under operating and finance leases.

Future cash requirements for long-term liabilities include $1,176,101 for future payments under operating and finance leases.

On October 15, 2025, the Company repaid in full the remaining balance of the loan payable, classified in the current liabilities section of our condensed consolidated balance sheet.

Our primary source of liquidity has historically been cash generated from equity and debt offerings.

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We have a history of recurring net losses and recurring use of cash in operations.

During the six months ended June 30, 2025, the Company received gross proceeds of $89,484,074 pursuant to the ATM.

Given our cash balance and our liquid digital asset holdings as of June 30, 2025, there is no substantial doubt about the Company’s ability to meet its obligations as they become due within the twelve months from the date these condensed consolidated financial statements are available to be issued.

While no assurance can be provided that we will be successful in raising additional capital from the ATM, during the period from July 1, 2025 through August 12, 2025, the Company issued 1.6 million shares of common stock for gross proceeds of $10.7 million pursuant to the ATM.

During the nine months ended September 30, 2025, the Company received gross proceeds of $107,311,618 pursuant to the ATM.

Given our cash balance and our digital asset holdings as of September 30, 2025, there is no substantial doubt about the Company’s ability to meet its obligations as they become due within the twelve months from the date these condensed consolidated financial statements are available to be issued.

While no assurance can be provided that we will be successful in raising additional capital from the ATM, during the period from October 1, 2025 through November 14, 2025, the Company issued 3.0 million shares of common stock for gross proceeds of $15.1 million pursuant to the ATM.

Off-Balance Sheet Arrangements

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(i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates that we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations.

There are items within our condensed consolidated financial statements that require estimation but are not deemed critical, as defined above.

Assessment of impairment of investments has been identified as a critical accounting estimate during the three and nine months ended September 30, 2025.

There are other items within our condensed consolidated financial statements that require estimation but are not deemed critical, as defined above.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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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 2. Management’s Discussion and Analysis