Hyperscale Data Issues Letter to Stockholders

Core Viewpoint - Hyperscale Data, Inc. is shifting its strategy to retain all mined Bitcoin and expand its digital asset holdings, particularly in XRP, while focusing on AI-optimized data centers as a core business model [1][2][4]. Group 1: Bitcoin and Digital Asset Strategy - The company will retain all Bitcoin mined, marking a significant change in corporate policy to enhance its balance sheet [1]. - Starting September 2, 2025, the company will publish weekly reports on its Bitcoin and XRP holdings to ensure transparency [2]. - The current mining run rate is approximately 190 Bitcoin annually, and the company plans to hold these coins instead of selling them [7]. Group 2: AI Infrastructure Development - Hyperscale Data is transforming its data centers to support AI computing requirements, with plans to increase power capacity from approximately 30 MW to 70 MW over the next 20 months [7]. - The company anticipates that the Michigan facility's power capacity could eventually reach around 340 MW, pending agreements with local utility providers [7]. - Development of additional data centers in Montana is underway, which could provide up to 20 MW of power if initial phases are completed [7]. Group 3: Corporate Structure and Valuation - The company is evolving into a pure play focused on AI data centers and digital assets, separating from its diversified holding company, Ault Capital Group [4][9]. - The current market capitalization is approximately $16 million, which the company believes does not reflect its true value, especially with projected full-year 2025 revenue guidance of $125 million to $135 million [11][12]. - The divestiture of Ault Capital Group is expected to occur in the first quarter of 2026, allowing Hyperscale Data to focus solely on its core operations [18]. Group 4: Leadership and Future Outlook - The leadership team is aligned with stockholders, with significant investments from Ault & Company, Inc., the largest stockholder [10]. - The company aims to build world-class AI infrastructure, grow its digital asset treasury, and maintain transparency in reporting [21]. - The strategic focus on scalable infrastructure and a growing digital asset base is expected to enhance long-term value for stockholders [15].