0001213900-26-037677
SEC filingDigi Power transitions from mining to AI infrastructure, revenue down 7.6% but net loss widened due to higher operating expenses.
Digi Power X Inc. describes itself as an innovative energy infrastructure company that develops cutting-edge data centers to drive the expansion of sustainable energy assets. The Corporation focuses on developing, owning, and operating data center facilities and delivering enterprise colocation and AI/GPU infrastructure services. It also owns a 60 MW gas fired power plant in North Tonawanda, New York, that operates as a peaker plant providing electrical power to the grid during peak demand. The Corporation's primary revenue generation comes from digital currency mining through participation in a mining pool, as well as colocation services. As of March 31, 2026, the Corporation had 17 employees.
The Corporation has developed the ARMS 200 (AI-Ready Modular Solution), a flagship modular Tier 3 AI data-center pod designed for rapid deployment of high-density AI and enterprise workloads. Key attributes include Tier 3 architecture with dual-path power redundancy, modular scalability starting at 1 MW, support for next-generation AI GPUs and liquid-cooling solutions, and accelerated deployment timelines. Additionally, the Corporation is advancing NeoCloudz™, a GPU-as-a-Service platform offering flexible, high-performance compute access for enterprises and AI-focused customers. For digital currency mining, the Corporation utilizes a mining pool with a Full-Pay-Per-Share payout mechanism. Digital currencies are held primarily in a Gemini exchange account, with holdings of approximately 51 bitcoins and 1,010 Ethereum as of March 31, 2026.
The Corporation generates revenue through colocation agreements for mining infrastructure and digital currency mining rewards. It is in advanced negotiations for 2026 covering AI data-center colocation and GPU-as-a-Service via NeoCloudz™. The Corporation primarily recognized revenues with organizations in the digital currency space for the year ended December 31, 2025. No specific customer concentration is disclosed, but the Corporation's colocation agreements involved approximately 9,700 active miners for that year.
The digital currency mining industry is highly competitive, with principal publicly listed competitors including Riot Platforms, Inc., MARA Holdings, Inc., Bitfarms Ltd., Argo Blockchain Plc, Hut 8 Corp., HIVE Digital Technologies Ltd., and Cipher Digital Inc. As the Corporation expands into large-scale data centers supporting HPC and AI workloads, it faces competition from established data-center operators such as Equinix, Inc., Digital Realty Trust, Inc., and CoreWeave, Inc., as well as certain bitcoin mining competitors. Competition centers on access to suitable land and power, engineering talent, and customers seeking scalable, energy-efficient data-center capacity.
The Corporation's strategy includes evolving from a solely digital asset mining business into a power-backed AI infrastructure and Tier 3 data-center platform while maintaining its mining operations. Key pillars include vertical integration with energy production, environmentally conscious development targeting carbon neutrality by 2026 and 100% renewable energy by 2030, and proprietary development of the ARMS platform for rapid data-center deployment. The Corporation is expanding its power portfolio across New York (123 MW in North Tonawanda, 18.7 MW in Buffalo), Alabama (70 MW with Tier 3 AI data-center development), and North Carolina (200 MW available for future development by 2028-2029). It also advances its AI compute roadmap and NeoCloudz™ platform.
As of March 31, 2026, the Corporation employed 17 individuals and engaged 18 consultants and contractors. The Corporation emphasizes integrity, transparency, and risk discipline, supports equal-opportunity employment, and maintains a safe and inclusive workplace. No employees are represented by a labor union, and no work stoppages have been experienced. Employee relations are described as good.
For the year ended December 31, 2025, Digi Power X reported total revenue of $34.19 million, a decrease of 7.6% from $37.00 million in 2024. The decline was driven by a 65.8% drop in bitcoin mining revenue to $3.53 million, partially offset by strong growth in colocation services (+10.6% to $17.47 million) and energy sales (+186% to $13.20 million). The company reported a net loss of $28.36 million, compared to a net loss of $12.39 million in the prior year. The expanded loss was primarily due to a $22.70 million increase in operating expenses, which included $8.03 million in share-based compensation (vs. $2.55 million), a $3.50 million foreign exchange loss (vs. a $5.23 million gain), and a $4.11 million loss on revaluation of digital currencies (vs. a $0.90 million gain). Gross profit turned negative, with cost of revenue of $37.40 million exceeding revenue, largely due to depreciation and power costs. The company's basic EPS was -$0.64, compared to -$0.40 in 2024.
Digi Power's revenue mix shifted significantly away from bitcoin mining toward hosting and energy sales. Bitcoin mining revenue fell to $3.53 million as the company mined only 34 bitcoins in 2025 versus 188 in 2024, reflecting a strategic pivot to colocation and AI infrastructure. Colocation service agreements generated $17.47 million, up from $15.79 million, benefiting from existing contracts. Energy sales from the natural gas plant surged to $13.20 million, as the plant sold power to the grid at peak rates after undergoing maintenance in Q4 2024. The sale of electricity segment ended after Q2 2024. Operating expenses ballooned due to non-cash charges and FX volatility, while cost of revenue decreased slightly to $37.40 million from $48.35 million, primarily due to lower depreciation and reduced mining activity at the Alabama site.
Management provided a clear roadmap for transitioning from cryptocurrency mining to AI-driven infrastructure. The company plans to allocate power capacity to AI projects: 5 MW in Q1 2026, 15 MW in Q2, 30 MW in Q3, and 55 MW (with 40 MW critical load) by Q4 2026. First ARMS modular AI data center pod is expected to be fully activated in Q2 2026, and the first NVIDIA B200 GPU cluster, in partnership with Super Micro, is also on track for Q2 2026. The company raised $104.7 million in equity during 2025, including $91.5 million from an ATM program, to fund this transformation. Management also targets carbon neutrality by end of 2026 and 100% renewable energy by 2030. Key risks include bitcoin price volatility, network difficulty, and the successful execution of the AI infrastructure buildout.
As of December 31, 2025, Digi Power X Inc. held $78.5M in cash and cash equivalents, a substantial increase from $1.7M a year earlier, primarily from equity financing. The company had no debt (loans payable, mortgage, and lease liabilities fully extinguished). Total shareholders' equity stood at $123.3M, up from $22.3M. Digital currencies held at fair value were $14.8M (Bitcoin $11.8M, Ethereum $3.0M).
The only noted commitment is a $5.32M purchase order for high-performance computers related to the Tier III AI data center project, expected to be paid within one year upon shipment. No other material contractual obligations were disclosed.
No share buyback or dividend programs were active. The company's capital spending (capex) was $17.3M, largely for property, plant, and equipment (including $1.4M for the AI data center). Debt repayment was minimal ($0.08M). Equity issuances (private placements, ATM program) raised approximately $108.2M net of costs, funding operations and capital investments.
The company operates four segments: cryptocurrency mining, sales of energy & electricity, colocation services, and the nascent Tier III AI data center (no revenue yet). Revenue from cryptocurrency mining dropped 65.9% to $3.5M, while colocation services grew 10.6% to $17.5M. Energy sales increased 21.2% to $13.2M. All segments except AI reported net losses, with colocation posting a $6.6M net loss (though EBITDA also negative). The AI segment had $11.0M in assets (under development).
Digi Power X is shifting from pure bitcoin mining to operating data centers for AI/HPC workloads. This introduces multiple risks: diversion of resources (capital, personnel, power) from core mining, heightened competition from well-capitalized data center incumbents, and execution risk in developing Tier III facilities (e.g., Columbiana, AL project). The company acknowledges that its AI/HPC strategy may not be profitable and that customer markets are still developing. Demand for data center services depends on sustained growth in AI/ML and cloud computing, which could be disrupted by technological shifts (e.g., reduced compute requirements) or high energy costs.
The April 2024 halving cut block rewards to 3.125 BTC; the next halving expected in 2028 will reduce rewards further to 1.5625 BTC. Mining profitability is sensitive to network hashrate, difficulty, and bitcoin price. The company relies on a single mining pool (Foundry Pool), creating dependency on pool terms and solvency. Additional risks include possible transition to proof-of-stake (making mining less relevant), cybersecurity threats to crypto holdings, irreversible transaction errors, and loss of private keys.
The company faces significant regulatory uncertainty: potential MSB registration under FinCEN, CFTC oversight of bitcoin transactions, state-level licensing (e.g., New York's expired moratorium but ongoing scrutiny), and evolving AI/HPC regulations (e.g., July 2025 Executive Order on AI). The loss of foreign private issuer status as of Jan 1, 2026, imposes heavier SEC reporting (10-Q, 8-K, Section 16), US GAAP adoption, and increased compliance costs. Tax treatment of digital assets remains uncertain; PFIC classification could adversely affect U.S. holders.
Material weaknesses in internal controls over financial reporting persist, threatening timely and accurate reporting. The company requires additional capital for expansion and operations, but no committed financing exists; future equity or debt raises may be dilutive or impose covenants. Currency exchange exposure (USD/CAD) is unhedged. The company has limited operating history and has not achieved consistent profitability (net loss of ~$28.4M in 2025).
US trade policies, including tariffs on imported mining equipment, increase costs. The creation of a U.S. strategic bitcoin reserve in March 2025 could introduce price volatility or government influence over the network. Geopolitical crises may drive large-scale crypto purchases or sales, impacting prices.