Soluna Holdings, Inc.

Hello, everyone. Thank you for joining us, and welcome to the Saluna Second Quarter 2026 Earnings Conference Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. I will now hand the conference over to Mike Tu, Vice President of Finance. Mike, please go ahead.

Good afternoon, and thank you for joining Saluna's second quarter 2026 earnings call. Our earnings release and the accompanying presentation are available in the investor relations section of salunacomputing.com, and this call is being webcast with the presentation. With me today are John Belizaire, Chief Executive Officer, Ryan Carver, Chief Development Officer, and Michael Picchi, Chief Financial Officer. Before management begins their formal remarks, we would like to remind everyone that some statements we're making today may be considered forward-looking statements under securities laws and involve a number of risks and uncertainties. As a result, we caution you that there are a number of factors, many of which are beyond our control, which could cause actual results and events to differ materially from those described in the forward-looking statements. For more detailed risks, uncertainties, and assumptions relating to our forward-looking statements, please see the disclosures in our earnings release and public filings made with the Securities and Exchange Commission. We disclaim any obligation or undertaking to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made, except as required by law. We will also discuss non-GAAP financial metrics and encourage you to read our disclosures and the reconciliation tables to applicable GAAP measures in our earnings release carefully as you consider these metrics. We refer you to our filings with the Securities and Exchange Commission for detailed disclosures and descriptions of our business, as well as uncertainties and other variable circumstances, including but not limited to risks and uncertainties identified under the caption risk factors in our annual report on Form 10-K for the year ended December 31st, 2025 and our other SEC filings. One note before we begin. Effective this quarter, we changed the presentation of pass-through electricity costs from a net basis to a gross basis. That change increases both reported revenue and reported cost of revenue by the same amount, and thus has no effect on gross profit, operating loss, or net loss. Every affected slide is footnoted, and Mike will walk through the mechanics. With that, I'll turn it over to John.

Thanks, Mike, too. Hello, and welcome to Saluna's second quarter results and business update. This is our first quarterly earnings webcast, and we're glad to have you all here. Let me start with a thesis because everything else today sits underneath it. Power is the primary constraint in the AI era. Not chips, not capital, power, and how quickly you can reach it. Saluna has secured long-term behind-the-meter access to power at scale, and we convert that access into contracted data center flows and data center cash flows by building directly on the site of renewable generation with stranded power by bypassing long grid queues. Four numbers frame where we stand today. Revenue grew 145% year over year, our fifth straight quarter of sequential growth. We have 192 megawatts of capacity under management A proven cash-generating operating base, and we expect that to increase this summer to 206 megawatts. We have over 650 megawatts across two AI campuses in development at Cottey 2 and Dorothy 3, both on track to secure leases and construction. And our renewable power pipeline grew 47% this year to over 6.3 gigawatts, the scarce input for AI sourced all behind the meter. Now let me spend a moment on the second and third of those because this is the quarter they connected. We like to say power is the asset and compute follows, and that's the Saluna way. In the second quarter, we took it all the way through at Project Dorothy. On April 1st, we closed the acquisition of the 150-megawatt Briscoe Wind Farm. On April 15th, we acquired Spring Lane Capital's interest in Dorothy 1A, and on May 19th, We acquired Navitas's interest in Dorothy 1B. So Luna now owns the generation and the compute across all 50 megawatts of Project Dorothy 1. Everyone in this industry is racing to secure power right now, signing PPAs, taking Q positions, negotiating with utilities for capacity that shows up in 2029. We acquired the wind farm. So when a hyperscaler or Neocloud customer performing diligence on one of our sites asks two questions that decide everything, how fast can you get me power and what is my energy cost? We answer both with an asset we own outright. Now, that model produces five revenue streams and the mix is shifting deliberately. Hosting for Bitcoin miners is our largest business today. We build and operate the data center. Creditworthy mining companies bring the machines, and that is the driver of our revenue. Proprietary Bitcoin mining is our own fleet. We sell daily and hold no treasury. Grid ancillary services pay us to be flexible, interruptible load, and we are compensated for acting as behind-the-meter flexible load for the grid operator. And Saluna Wind is our new addition this quarter, on-site wind generation at Briscoe with ERCOT substation and grid interconnection. and of course, AI High Performance Computing, co-location and hosting for companies that need AI ready capacity is where this company is going. That is the segment Ryan was hired to build. Everything we are doing this year sits under four priorities. First, develop AI. Advance Cottey 2 and Dorothy 3 to shovel ready and tenant ready and build a pipeline of AI ready campuses designed for rapid deployment. Next is optimizing our projects. We are focused on energizing and ramping Kadi One and driving profitability across the operating fleet through uptime, operational efficiency, and discipline cost management. Next is capital formation. We intend to fund pipeline growth and AI development through project level financing and strategic capital partnerships while maintaining balance sheet flexibility. And finally, we are focused on growing our pipeline. As I said earlier, we reached 6.3 gigawatts this quarter with more than 300 megawatts of the growth coming from expanded term sheets at four sites already in our portfolio. I want to say something about capital formation because it is a question I get most. We raised $159.4 million in the second quarter and an additional $23.6 million on our ATM program since quarter end, issuing about 18.8 million shares. And here is what that accomplished. 100% ownership to Project Dorothy 1, a 150 megawatt wind farm, the Cottey 2 joint venture and land for Dorothy 3, and a clean capital structure We retired the Series B entirely this quarter and paid out the accumulated dividends. Every dollar of that went into assets that are now on the balance sheet today. Going forward, the large AI builds are designed to be funded predominantly with project-level debt collateralized by the data center and underwritten against contracted tenant cash flows. Mike Picchi will take you through that structure. So let's get into the quarter. On the business side, four things. We were added to the Russell 3000 and Russell 2000 indices in the latest reconstitution, and new sell-side research coverage has been initiated on the company in recent weeks. Together with more formal quarterly communications you are seeing today, these reflect a deliberate effort to elevate Saluna's visibility and accessibility to institutional investors. We closed the $53 million acquisition of Briscoe Wind Farm on April 1st, as I mentioned, and it's our first direct ownership of a renewable generation asset. We consolidated 100% of Project Dorothy 1A and 1B, strengthening the path toward Dorothy 3, our new AI campus. On the project side, our teams delivered across all four campuses. Kadi 2 reached a definitive joint venture with Metro Blocks, completed design development, and signed a tenant letter of intent. Dorothy 3 secured a definitive land purchase agreement and advanced utility coordination. Kadi 1 completed substantial construction, and Dorothy 1A and Sophie held capacity through a heavy summer curtailment window. Ryan will take you through the AI project highlights in detail shortly. Now I'd like to talk about the pipeline, which is our core asset. As of August 1st, the total pipeline is approximately 6.3 gigawatts. That's up from 4.3 gigawatts earlier this year, and I want you to see how it is structured. 192 megawatts is operating, energized, and generating revenue today. 14 megawatts is under construction, the final phase of CAUTI-1. We expect this will take us to 206 megawatts operating by the end of the summer. Approximately 1.6 gigawatts is in planning and development where PPA negotiations, ERCOT planning, AI feasibility work, and land acquisition activities are underway. And approximately 4.5 gigawatts is in assessment with our power partners. One more piece of the model. Our behind-the-meter structure keeps our data centers flexible. We can draw power from the renewable plant and from the grid, and we can provide ancillary services back to the grid. That flexibility is what gives us rapid time to interconnection. And we will cluster. We plan to use multiple generation assets in proximity to a single data center site, which is how a footprint that would otherwise support a fraction of the capacity becomes a 300 megawatt campus. We are using that approach at CAUTI 2 and DOOR T3, and you will see it in our other sites. Before I turn to the roadmap, I want to address the recent announcements coming out of Texas. On August 3rd, Governor Abbott directed the PUCT and ERCOT to audit every data center in ERCOT's interconnection queue before approving new projects. That is a response to roughly 474 gigawatts of pending requests, about 90% of which are data centers that mandate targets new studied loads in the interconnection queue. I want to share four points on where we, Saluna, sit. First, our direct exposure is limited. The audit targets new studied load, roughly 146 megawatts of our capacity in Texas is already energized. and both Dorothy 3 and Kadi 2 build off adjacent energized interconnections. Second, our model fits what the state is screening for. No costly transmission upgrades, flexible interruptible load, new wind and solar, minimum water by design. We fund our own electrical infrastructure. And third, we see this as a tailwind for operators with live capacity. with the queue frozen for the audit and ERCOT's August 7th dispatch delayed, energized capacity gains value. And fourth, we welcome the review. We support a rigorous and consistent review process, and we are cooperating fully with the PUCT and ERCOT. So I want to close with what's on tap for the balance of the year. We're focused on completing CAUTI 1 with the final 14 megawatts, We plan to move from design development to construction documents at Kadi 2. We're advancing the Dorothy 3 development and begin marketing to potential tenants. New Bitcoin hosting announcements we expect to take place at Kadi 1. And we are also looking at new power purchase agreements underway with Rosa, Hedy, Ellen, Annie and new projects. Those are the milestones and we will report against them next quarter. All right, before I hand it over, everything you've heard so far, the wind farm, the buyouts, the capital, exists for one reason, converting our power position into contracted AI megawatts, which brings me to the newest member of our leadership team. On July 16th, we appointed Ryan Carver as our chief development officer. Ryan joins us from Microsoft, where he was most recently serving as Senior Director of AI Construction and Site Development, leading a construction P&L in the tens of billions of dollars across the company's AI data center development. There are very few people who have delivered hyperscale AI campuses end to end, and Ryan is certainly one of them. His mandate here is deliberately broad from site selection and development to engineering and construction. and operations all in one organization reporting to me. Ryan, welcome to Saluna and take it away.