Q2 2026 AVAX One Technology Ltd Earnings Call
Speaker #1: Good afternoon, everyone, and thank you for participating in today's conference call to discuss AVAX One's financial and operating results for the second quarter ended June 30th, , 2026.
Operator: Good afternoon, everyone, and thank you for participating in today's conference call to discuss AVAX One's financial and operating results for the second quarter ended 30 June 2026. Joining us today are the company's Interim Chief Executive Officer and Chief Operating Officer, Pete Wylie, and the company's Chief Financial Officer, Chris Polimeni. By now, everyone should have access to AVAX One's second quarter 2026 earnings press release, which was issued earlier this afternoon at approximately 4:05 PM Eastern Time. The release is available in the investor relations section of the company's website at www.avax-one.com. A webcast replay of this call will also be available on the company's website. Following management remarks, we will open the call up for your questions. Please be advised this conference call will contain statements that are considered forward-looking statements under the Private Securities Litigation Reform Act of 1995.
Operator: Good afternoon, everyone, and thank you for participating in today's conference call to discuss AVAX One's financial and operating results for the second quarter ended 30 June 2026. Joining us today are the company's Interim Chief Executive Officer and Chief Operating Officer, Pete Wylie, and the company's Chief Financial Officer, Chris Polimeni. By now, everyone should have access to AVAX One's second quarter 2026 earnings press release, which was issued earlier this afternoon at approximately 4:05 PM Eastern Time. The release is available in the investor relations section of the company's website at www.avax-one.com. A webcast replay of this call will also be available on the company's website. Following management remarks, we will open the call up for your questions. Please be advised this conference call will contain statements that are considered forward-looking statements under the Private Securities Litigation Reform Act of 1995.
Speaker #1: Joining us today are the company's interim chief executive officer and chief operating officer, Pete Wiley, and the company's chief financial officer, Chris Polomini. By now, everyone should have access to AVAX One's second quarter 2026 earnings press release, which was issued earlier this afternoon at approximately 4:05 PM Eastern Time.
Speaker #1: The release is available in the investor relations section of the company's website at www.avax-one.com. A webcast replay of this call will also be available on the company's website.
Speaker #1: Following management remarks, we'll open the call up for your questions. Please be advised, this conference call will contain statements that are considered forward-looking statements under the Private Securities Litigation Reform Act of 1995.
Speaker #1: These forward-looking statements are subject to certain known and unknown risks and uncertainties, as well as assumptions that could cause actual results to differ materially from those reflected in these forward-looking statements.
Operator: These forward-looking statements are subject to certain unknown and unknown risks and uncertainties, as well as assumptions that could cause actual results to differ materially from those reflected in these forward-looking statements. These forward-looking statements are also subject to other risks and uncertainties that are described from time to time in the company's filings with the SEC. You are urged to not place undue reliance on any forward-looking statements, which are being made only as of the date of this call. Except as required by law, the company undertakes no obligation to publicly update or revise any forward-looking statements. For important risks and assumptions associated with such forward-looking statements, please refer to the company's SEC filings. I will now turn the call over to Pete Wylie, AVAX One's Interim Chief Executive Officer and Chief Operating Officer. Pete?
Operator: These forward-looking statements are subject to certain unknown and unknown risks and uncertainties, as well as assumptions that could cause actual results to differ materially from those reflected in these forward-looking statements. These forward-looking statements are also subject to other risks and uncertainties that are described from time to time in the company's filings with the SEC. You are urged to not place undue reliance on any forward-looking statements, which are being made only as of the date of this call. Except as required by law, the company undertakes no obligation to publicly update or revise any forward-looking statements. For important risks and assumptions associated with such forward-looking statements, please refer to the company's SEC filings. I will now turn the call over to Pete Wylie, AVAX One's Interim Chief Executive Officer and Chief Operating Officer. Pete?
Speaker #1: These forward-looking statements are also subject to other risks and uncertainties that are described from time to time in the company's filings with the SEC.
Speaker #1: You are urged to not place undue reliance on any forward-looking statements which are being made only as of the date of this call. Except as required by law, the company undertakes no obligation to publicly update or revise any forward-looking statements.
Speaker #1: For important risks and assumptions associated with such forward-looking statements, please refer to the company's SEC filings. I will now turn the call over to Pete Wiley, AVAX One's interim Chief Executive Officer and Chief Operating Officer.
Speaker #1: Pete?
Speaker #2: Thank you, operator, and thank you all for joining us today. We are seeing continued development across the Avalanche ecosystem that has reinforced our conviction in the network's long-term potential and the strategic value of AVAX One's position within it.
Pete Wylie: Thank you, operator, and thank you all for joining us today. We are seeing continued development across the Avalanche ecosystem that has reinforced our conviction in the network's long-term potential and the strategic value of AVAX One's position within it. That progress is becoming increasingly visible across a broad range of applications, including institutional settlement, tokenized assets, validator participation, and large-scale commercial platforms. In our view, the growing breadth and sophistication of these use cases demonstrate that Avalanche is moving beyond experimentation and toward real-world deployment. That evolution is particularly significant in financial services, where institutions are increasingly focused on the practical applications of blockchain technology in payments, tokenization, settlement, and other financial workflows. We believe Avalanche is well-positioned to support that transition. Its architecture enables institutions to build purpose-built blockchain environments tailored to their operational, regulatory, and performance requirements while remaining connected to the broader Avalanche ecosystem.
Pete Wylie: Thank you, operator, and thank you all for joining us today. We are seeing continued development across the Avalanche ecosystem that has reinforced our conviction in the network's long-term potential and the strategic value of AVAX One's position within it. That progress is becoming increasingly visible across a broad range of applications, including institutional settlement, tokenized assets, validator participation, and large-scale commercial platforms. In our view, the growing breadth and sophistication of these use cases demonstrate that Avalanche is moving beyond experimentation and toward real-world deployment. That evolution is particularly significant in financial services, where institutions are increasingly focused on the practical applications of blockchain technology in payments, tokenization, settlement, and other financial workflows. We believe Avalanche is well-positioned to support that transition. Its architecture enables institutions to build purpose-built blockchain environments tailored to their operational, regulatory, and performance requirements while remaining connected to the broader Avalanche ecosystem.
Speaker #2: That progress is becoming increasingly visible across a broad range of applications, including institutional settlement, tokenized assets, validator participation, and large-scale commercial platforms. In our view, the growing breadth and sophistication of these use cases demonstrate that avalanches moving beyond experimentation and toward real-world deployment.
Speaker #2: That evolution is particularly significant in financial services, where institutions are increasingly focused on the practical applications of blockchain technology in payments, tokenization, settlement, and other financial workflows.
Speaker #2: We believe avalanches well-positioned to support that transition. Its architecture enables institutions to build purpose-built blockchain environments tailored to their operational, regulatory, and performance requirements, while remaining connected to the broader avalanche ecosystem.
Speaker #2: Tacit's recent migration of Link provides a clear example of how that model can work in practice. Tacit is a financial technology company that provides blockchain-based payment and settlement infrastructure for regulated financial institutions.
Pete Wylie: Tassat's recent migration of Link provides a clear example of how that model can work in practice. Tassat is a financial technology company that provides blockchain-based payment and settlement infrastructure for regulated financial institutions. Link is its real-time settlement network designed to help institutional participants transfer value and complete transactions more efficiently. Tassat moved Link onto a dedicated Avalanche layer one, effectively giving the network its own customized blockchain environment. This allows Tassat to control how the network is configured, who validates transactions, and how data is managed, while still benefiting from Avalanche's speed and scalability. Tassat's broader infrastructure has processed more than $2.5 trillion in transactions, and we believe this migration demonstrates Avalanche's ability to support secure, institutionally-oriented financial infrastructure at scale. Beyond institutional finance, Avalanche is demonstrating its ability to support large-scale consumer applications.
Pete Wylie: Tassat's recent migration of Link provides a clear example of how that model can work in practice. Tassat is a financial technology company that provides blockchain-based payment and settlement infrastructure for regulated financial institutions. Link is its real-time settlement network designed to help institutional participants transfer value and complete transactions more efficiently. Tassat moved Link onto a dedicated Avalanche layer one, effectively giving the network its own customized blockchain environment. This allows Tassat to control how the network is configured, who validates transactions, and how data is managed, while still benefiting from Avalanche's speed and scalability. Tassat's broader infrastructure has processed more than $2.5 trillion in transactions, and we believe this migration demonstrates Avalanche's ability to support secure, institutionally-oriented financial infrastructure at scale. Beyond institutional finance, Avalanche is demonstrating its ability to support large-scale consumer applications.
Speaker #2: Link is its real-time settlement network designed to help institutional participants transfer value and complete transactions more efficiently. Tacit moved Link onto a dedicated Avalanche layer one, effectively giving the network its own customized blockchain environment.
Speaker #2: This allows Tacit to control how the network is configured, who validates transactions, and how data is managed, while still benefiting from avalanche's speed and scalability.
Speaker #2: Tacit's broader infrastructure has processed more than $2.5 trillion in transactions, and we believe this migration demonstrates Avalanche's abilities to support secure, institutionally-oriented financial infrastructure at scale.
Speaker #2: Beyond institutional finance, Avalanche is demonstrating its ability to support large-scale consumer applications. During the 2026 FIFA World Cup, FIFA Collect, the organization's digital collectibles platform, operated on an Avalanche-powered blockchain.
Pete Wylie: During the 2026 FIFA World Cup, FIFA Collect, the organization's digital collectibles platform, operated on an Avalanche-powered blockchain. While the use case is distinct from payments and settlement, it provides another example of Avalanche supporting a globally recognized platform with a broad consumer audience. Avalanche is also continuing to improve the network's underlying infrastructure. Pelican, a recent protocol upgrade, has been activated on the Fuji testnet, where new features are evaluated before potential deployment to Avalanche's live Mainnet. Among other changes, Pelican introduces automatic renewal for validator staking and proposes reducing the minimum primary network staking period from two weeks to 48 hours. While these changes are not yet live on Mainnet, we believe they could provide validators with greater flexibility and make participation more accessible to institutional operators.
Pete Wylie: During the 2026 FIFA World Cup, FIFA Collect, the organization's digital collectibles platform, operated on an Avalanche-powered blockchain. While the use case is distinct from payments and settlement, it provides another example of Avalanche supporting a globally recognized platform with a broad consumer audience. Avalanche is also continuing to improve the network's underlying infrastructure. Pelican, a recent protocol upgrade, has been activated on the Fuji testnet, where new features are evaluated before potential deployment to Avalanche's live Mainnet. Among other changes, Pelican introduces automatic renewal for validator staking and proposes reducing the minimum primary network staking period from two weeks to 48 hours. While these changes are not yet live on Mainnet, we believe they could provide validators with greater flexibility and make participation more accessible to institutional operators.
Speaker #2: While the use cases distinct from payments and settlement, it provides another example of avalanche supporting a globally recognized platform with a broad consumer audience.
Speaker #2: Avalanche is also continuing to improve the network's underlying infrastructure. Elicon, a recent protocol upgrade, has been activated on the Fuji Testnet, where new features are evaluated before potential deployment to avalanches live mainnet.
Speaker #2: Among other changes, Elicon introduces automatic renewal for validator staking and proposes reducing the minimum Primary Network staking period from two weeks to 48 hours.
Speaker #2: While these changes are not yet live on mainnet, we believe they could provide validators with greater flexibility and make participation more accessible to institutional operators.
Speaker #2: The combination of these deployments illustrates the breadth of activity emerging in the Avalanche ecosystem—from institutional settlement and tokenized assets to validator participation and large-scale consumer applications.
Pete Wylie: The combination of these deployments illustrates the breadth of activity emerging in the Avalanche ecosystem, from institutional settlement and tokenized assets to validator participation in large-scale consumer applications. For AVAX One, the continued expansion of the network reinforces our conviction in Avalanche's long-term potential, and in turn, the strategic rationale for maintaining and growing our AVAX digital asset treasury. Turning to our operations, AVAX One is organized around three core pillars: our Avalanche digital asset treasury, Bitcoin mining, and the selective development of AI and high-performance computing opportunities. Our Avalanche treasury is central to the strategy. We currently own more than 14 million AVAX tokens and equivalents, including approximately 800,000 which have been deployed into Treehouse, providing us with meaningful exposure to the continued growth of the Avalanche ecosystem.
Pete Wylie: The combination of these deployments illustrates the breadth of activity emerging in the Avalanche ecosystem, from institutional settlement and tokenized assets to validator participation in large-scale consumer applications. For AVAX One, the continued expansion of the network reinforces our conviction in Avalanche's long-term potential, and in turn, the strategic rationale for maintaining and growing our AVAX digital asset treasury. Turning to our operations, AVAX One is organized around three core pillars: our Avalanche digital asset treasury, Bitcoin mining, and the selective development of AI and high-performance computing opportunities. Our Avalanche treasury is central to the strategy. We currently own more than 14 million AVAX tokens and equivalents, including approximately 800,000 which have been deployed into Treehouse, providing us with meaningful exposure to the continued growth of the Avalanche ecosystem.
Speaker #2: For AVAX One, the continued expansion of the network reinforces our conviction in avalanches' long-term potential and, in turn, the strategic rationale for maintaining and growing our AVAX digital asset treasury.
Speaker #2: Turning to our operations, AVAX One is organized around three core pillars: our Avalanche digital asset treasury, Bitcoin mining, and the selective development of AI and high-performance computing opportunities.
Speaker #2: Our avalanche treasury is central to the strategy. We currently own more than 14 million AVAX tokens and equivalents, including approximately 800,000, which have been deployed into Treehouse.
Speaker #2: Providing us with meaningful exposure to the continued growth of the avalanche ecosystem. By staking a significant portion of these holdings directly through the network, we participate in network validation and earn protocol-native rewards, creating an ongoing source of revenue while increasing our AVAX holdings over time.
Pete Wylie: By staking a significant portion of these holdings directly through the network, we participate in network validation and earn protocol native rewards, creating an ongoing source of revenue while increasing our AVAX holdings over time. Our second pillar is Bitcoin mining, which continues to provide recurring operating revenue across our facilities in Alberta and Ohio. Over the past year, we've expanded the platform through additional mining equipment, including 220 machines added to our Alberta operations, while continuing to operate our five megawatt Bald Eagle facility in Ohio, which is powered by flared natural gas. These operations also provide valuable experience managing power generation, equipment deployment, and energy-intensive infrastructure. We will continue to manage each site with a focus on operating performance, energy efficiency, capital discipline, and the productive use of our existing assets. Our third pillar is AI and high-performance computing.
Pete Wylie: By staking a significant portion of these holdings directly through the network, we participate in network validation and earn protocol native rewards, creating an ongoing source of revenue while increasing our AVAX holdings over time. Our second pillar is Bitcoin mining, which continues to provide recurring operating revenue across our facilities in Alberta and Ohio. Over the past year, we've expanded the platform through additional mining equipment, including 220 machines added to our Alberta operations, while continuing to operate our five megawatt Bald Eagle facility in Ohio, which is powered by flared natural gas. These operations also provide valuable experience managing power generation, equipment deployment, and energy-intensive infrastructure. We will continue to manage each site with a focus on operating performance, energy efficiency, capital discipline, and the productive use of our existing assets. Our third pillar is AI and high-performance computing.
Speaker #2: Our second pillar is Bitcoin mining, which continues to provide recurring operating revenue across our facilities in Alberta and Ohio. Over the past year, we've expanded the platform through additional mining equipment.
Speaker #2: Including 220 machines added to our Alberta operations, while continuing to operate our 5-megawatt Bald Eagle facility in Ohio, which is powered by flare natural gas.
Speaker #2: These operations also provide valuable experience managing power generation equipment deployment and energy-intensive infrastructure. We will continue to manage each site with a focus on operating performance, energy efficiency, capital discipline, and the productive use of our existing assets.
Speaker #2: Our third pillar is AI and high-performance computing. We believe our experience operating power-intensive infrastructure managing energy costs, and deploying modular equipment provides a practical foundation for this developing strategy.
Pete Wylie: We believe our experience operating power-intensive infrastructure, managing energy costs, and deploying modular equipment provides a practical foundation for this developing strategy. In Alberta, we are advancing a power-first deployment model centered on behind-the-meter natural gas generation, modular construction, and energy advantage sites, with the goal of delivering reliable compute capacity on a faster and more capital-efficient basis than traditional grid-dependent projects. We will continue to evaluate infrastructure opportunities selectively, with a focus on technical feasibility, customer demand, capital requirements, and the potential to generate durable recurring revenue. During the Q2, we announced an initial AI inference pilot at our Redwater facility, involving the potential conversion of approximately 100 kilowatts of excess mining capacity to AI workloads. The pilot is designed to assess the technical requirements and potential economics of inference computing using infrastructure already within our operating footprint.
Pete Wylie: We believe our experience operating power-intensive infrastructure, managing energy costs, and deploying modular equipment provides a practical foundation for this developing strategy. In Alberta, we are advancing a power-first deployment model centered on behind-the-meter natural gas generation, modular construction, and energy advantage sites, with the goal of delivering reliable compute capacity on a faster and more capital-efficient basis than traditional grid-dependent projects. We will continue to evaluate infrastructure opportunities selectively, with a focus on technical feasibility, customer demand, capital requirements, and the potential to generate durable recurring revenue. During the Q2, we announced an initial AI inference pilot at our Redwater facility, involving the potential conversion of approximately 100 kilowatts of excess mining capacity to AI workloads. The pilot is designed to assess the technical requirements and potential economics of inference computing using infrastructure already within our operating footprint.
Speaker #2: In Alberta, we are advancing a power-first deployment model centered on behind-the-meter natural gas generation, modular construction, and energy-advantaged sites, with the goal of delivering reliable compute capacity on a faster and more capital-efficient basis than traditional grid-dependent projects.
Speaker #2: We will continue to evaluate infrastructure opportunities selectively, with a focus on technical feasibility, customer demand, capital requirements, and the potential to generate durable recurring revenue.
Speaker #2: During the second quarter, we announced an initial AI inference pilot at our Redwater facility, involving the potential conversion of approximately 100 kilowatts of excess mining capacity to AI workloads.
Speaker #2: The pilot is designed to assess the technical requirements and potential economics of inference computing using infrastructure already within our operating footprint. Alberta remains an area of interest, given our existing presence and familiarity with the regional power market.
Pete Wylie: Alberta remains an area of interest given our existing presence and familiarity with the regional power market. Although we will pursue opportunities selectively based on economics, capital requirements, and strategic fit. In addition to executing across our three operating pillars, we are evaluating strategic opportunities that could strengthen and expand the platform. These opportunities may arise within our Avalanche treasury and ecosystem strategy, Bitcoin mining operations, or AI and high-performance computing initiatives. Our focus is on accretive opportunities that can build durable revenue and cash flow while enhancing the productivity of existing assets. This includes potential acquisitions, partnerships, infrastructure investments, and operational initiatives that complement our capabilities and improve the long-term economics of the business. We carefully evaluate each opportunity based on the quality of the underlying business or asset, its strategic fit, expected financial contribution, and capital requirements.
Pete Wylie: Alberta remains an area of interest given our existing presence and familiarity with the regional power market. Although we will pursue opportunities selectively based on economics, capital requirements, and strategic fit. In addition to executing across our three operating pillars, we are evaluating strategic opportunities that could strengthen and expand the platform. These opportunities may arise within our Avalanche treasury and ecosystem strategy, Bitcoin mining operations, or AI and high-performance computing initiatives. Our focus is on accretive opportunities that can build durable revenue and cash flow while enhancing the productivity of existing assets. This includes potential acquisitions, partnerships, infrastructure investments, and operational initiatives that complement our capabilities and improve the long-term economics of the business. We carefully evaluate each opportunity based on the quality of the underlying business or asset, its strategic fit, expected financial contribution, and capital requirements.
Speaker #2: Although we will pursue opportunities selectively based on economics, capital requirements, and strategic fit, in addition to executing across our three operating pillars, we are evaluating strategic opportunities that could strengthen and expand the platform.
Speaker #2: These opportunities may arise within our avalanche treasury and ecosystem strategy, Bitcoin mining operations, or AI in high-performance computing initiatives. Our focus is on a creative opportunities that can build durable revenue and cash flow while enhancing the productivity of our existing assets.
Speaker #2: This includes potential acquisitions or partnerships, infrastructure investments, and operational initiatives that complement our capabilities and improve the long-term economics of the business. We carefully evaluate each opportunity based on the quality of the underlying business or asset, its strategic fit, expected financial contribution, and capital requirements.
Speaker #2: Our objective is to pursue transactions, strategic relationships, and other opportunities that strengthen AVAX One's operating foundation and create sustainable, long-term value for shareholders. Looking ahead, we are intently focused on building a stronger, more durable operating platform.
Pete Wylie: Our objective is to pursue transactions, strategic relationships, and other opportunities that strengthen AVAX One's operating foundation and create sustainable long-term value for shareholders. Looking ahead, we are intently focused on building a stronger, more durable operating platform. We will continue to allocate capital selectively across our three pillars, pursue opportunities that can expand recurring revenue and cash flow, and remain active under our share repurchase program when we believe our shares trade below the intrinsic value of the business. We believe these initiatives, coupled with our prudent approach to capital allocation, will enable us to deliver long-term shareholder value. With that, I will now turn the call over to our Chief Financial Officer, Chris Polimeni, to review our Q2 financial results. Chris?
Pete Wylie: Our objective is to pursue transactions, strategic relationships, and other opportunities that strengthen AVAX One's operating foundation and create sustainable long-term value for shareholders. Looking ahead, we are intently focused on building a stronger, more durable operating platform. We will continue to allocate capital selectively across our three pillars, pursue opportunities that can expand recurring revenue and cash flow, and remain active under our share repurchase program when we believe our shares trade below the intrinsic value of the business. We believe these initiatives, coupled with our prudent approach to capital allocation, will enable us to deliver long-term shareholder value. With that, I will now turn the call over to our Chief Financial Officer, Chris Polimeni, to review our Q2 financial results. Chris?
Speaker #2: We will continue to allocate capital selectively across our three pillars, pursue opportunities that can expand recurring revenue and cash flow, and remain active under our share repurchase program when we believe our shares trade below the intrinsic value of the business.
Speaker #2: We believe these initiatives, coupled with our prudent approach to capital allocation, will enable us to deliver long-term shareholder value. With that, I will now turn the call over to our Chief Financial Officer, Chris Polomini, to review our second quarter financial results.
Speaker #2: Chris?
Speaker #3: Thank you, Pete. As a quick reminder, as we review our second quarter, 2026 financial results, all comparisons and variants commentary will refer to the prior year quarter, unless otherwise specified.
Chris Polimeni: Thank you, Pete. As a quick reminder, as we review our Q2 2026 financial results, all comparisons and variance commentary will refer to the prior year quarter, unless otherwise specified. Total revenue for our Q2 2026 was $2.8 million, which represents a significant increase compared to approximately $500,000 in the Q2 2025. This increase primarily reflects our transition to the Avalanche Digital Asset Treasury strategy in Q4 2025. Our revenue in the Q2 2026 consisted of approximately $2.1 million in staking rewards revenue from our digital asset treasury strategy, as well as approximately $700,000 in revenue from our Bitcoin mining operations. Our total operating expenses for the Q2 2026 were $36.2 million, compared to $1.8 million in the Q2 2025.
Chris Polimeni: Thank you, Pete. As a quick reminder, as we review our Q2 2026 financial results, all comparisons and variance commentary will refer to the prior year quarter, unless otherwise specified. Total revenue for our Q2 2026 was $2.8 million, which represents a significant increase compared to approximately $500,000 in the Q2 2025. This increase primarily reflects our transition to the Avalanche Digital Asset Treasury strategy in Q4 2025. Our revenue in the Q2 2026 consisted of approximately $2.1 million in staking rewards revenue from our digital asset treasury strategy, as well as approximately $700,000 in revenue from our Bitcoin mining operations. Our total operating expenses for the Q2 2026 were $36.2 million, compared to $1.8 million in the Q2 2025.
Speaker #3: Total revenue for our second quarter of 2026 was $2.8 million, which represents a significant increase compared to approximately $500,000 in the second quarter of 2025.
Speaker #3: This increase primarily reflects our transition to the Avalanche digital asset treasury strategy in Q4 of '25. Our revenue in the second quarter of '26 consisted of approximately $2.1 million in staking rewards revenue from our digital asset treasury.
Speaker #3: Strategy, as well as approximately $700,000 in revenue from our Bitcoin mining operations. Our total operating expenses for the second quarter of 2026 were $36.2 million, compared to $1.8 million in the second quarter of '25.
Speaker #3: The operating expenses for the second quarter of '26 included $33 million of non-cash charges, related to A, $29.8 million unrealized loss in the change in market value of our digital assets; B, a $2.6 million impairment of our Treehouse liquid staking tokens; and C, a $600,000 share-based compensation depreciation expense.
Chris Polimeni: The operating expenses for Q2 2026 included $33 million of non-cash charges related to, A, a $29.8 million unrealized loss in the change in market value of our digital assets, B, a $2.6 million impairment of our Treehouse liquid staking tokens, and C, a $600,000 share-based compensation depreciation expense. Excluding these non-cash charges, our adjusted operating expenses for Q2 2026 were $3.2 million. We reported a net loss for Q2 2026 of $35.1 million, or $4.41 per diluted share, compared to a net loss of $8.1 million or greater than $35.88 per diluted share in Q2 2025. Excluding the aforementioned non-cash expenses, adjusted net loss for Q2 2026 was $2.2 million or $0.27 per diluted share.
Chris Polimeni: The operating expenses for Q2 2026 included $33 million of non-cash charges related to, A, a $29.8 million unrealized loss in the change in market value of our digital assets, B, a $2.6 million impairment of our Treehouse liquid staking tokens, and C, a $600,000 share-based compensation depreciation expense. Excluding these non-cash charges, our adjusted operating expenses for Q2 2026 were $3.2 million. We reported a net loss for Q2 2026 of $35.1 million, or $4.41 per diluted share, compared to a net loss of $8.1 million or greater than $35.88 per diluted share in Q2 2025. Excluding the aforementioned non-cash expenses, adjusted net loss for Q2 2026 was $2.2 million or $0.27 per diluted share.
Speaker #3: Excluding these non-cash charges, our adjusted operating expenses for the second quarter of '26 were $3.2 million. We reported a net loss for the second quarter of 2026 of $35.1 million, or $4.41 per diluted share.
Speaker #3: Compared to a net loss of $8.1 million, or greater than $35.88 per diluted share, in the second quarter of '25. Excluding the aforementioned non-cash expenses, adjusted net loss for the second quarter of '26 was $2.2 million, or $27 per diluted share.
Speaker #3: As of June 30, 2026, our total liquidity was approximately $21.1 million. Consisting of cash and cash equivalents of $11.4 million, restricted cash of $5.4 million, and an escrow receivable balance of $4.3 million.
Chris Polimeni: As of 30 June 2026, our total liquidity was approximately $21.1 million, consisting of cash and cash equivalents of $11.4 million, restricted cash of $5.4 million, and an escrow receivable balance of $4.3 million. This compares to approximately $27.6 million in total liquidity as of 31 December 2025. We believe our liquidity position, coupled with our ability to generate additional liquidity by leveraging or liquidating the digital assets earned through staking and Bitcoin mining, will provide the company with sufficient liquidity to fund our operating expenses as well as to execute our growth strategy without the need to raise additional capital.
Chris Polimeni: As of 30 June 2026, our total liquidity was approximately $21.1 million, consisting of cash and cash equivalents of $11.4 million, restricted cash of $5.4 million, and an escrow receivable balance of $4.3 million. This compares to approximately $27.6 million in total liquidity as of 31 December 2025. We believe our liquidity position, coupled with our ability to generate additional liquidity by leveraging or liquidating the digital assets earned through staking and Bitcoin mining, will provide the company with sufficient liquidity to fund our operating expenses as well as to execute our growth strategy without the need to raise additional capital.
Speaker #3: This compares to approximately $27.6 million in total liquidity as of December 31, 2025. We believe our liquidity position, coupled with our ability to generate additional liquidity by leveraging or liquidating the digital assets earned through staking and Bitcoin mining, will provide the company with sufficient liquidity to fund our operating expenses, as well as to execute our growth strategy, without the need to raise additional capital.
Speaker #3: As of June 30, 2026, the last day of our second quarter, AVAX One held approximately 13.2 million AVAX tokens, with a net value of $86.3 million.
Chris Polimeni: As of 30 June 2026, the last day of our second quarter, AVAX One held approximately 13.2 million AVAX tokens with a net value of $86.3 million, approximately 700,000 pAVAX tokens through our deployment with Treehouse with a net value of approximately $5.3 million, and approximately 31 Bitcoin with a net value of approximately $1.8 million, resulting in a total net value of our digital assets of approximately $93.5 million. Since the inception of our digital asset treasury strategy in November 2025, we have generated approximately $4.7 million in staking revenue, with our staking activities producing an annualized yield of approximately 5.3%. Subsequent to quarter end, as announced last week, we completed the restructuring of certain outstanding convertible debentures, reducing the related principal balance by approximately $6.8 million.
Chris Polimeni: As of 30 June 2026, the last day of our second quarter, AVAX One held approximately 13.2 million AVAX tokens with a net value of $86.3 million, approximately 700,000 pAVAX tokens through our deployment with Treehouse with a net value of approximately $5.3 million, and approximately 31 Bitcoin with a net value of approximately $1.8 million, resulting in a total net value of our digital assets of approximately $93.5 million. Since the inception of our digital asset treasury strategy in November 2025, we have generated approximately $4.7 million in staking revenue, with our staking activities producing an annualized yield of approximately 5.3%. Subsequent to quarter end, as announced last week, we completed the restructuring of certain outstanding convertible debentures, reducing the related principal balance by approximately $6.8 million.
Speaker #3: Approximately $700,000 T-AVAX tokens through our deployment with Treehouse, with a net value of approximately $5.3 million, and approximately $31 Bitcoin, with a net value of approximately $1.8 million.
Speaker #3: Resulting in a total net value of our digital assets of approximately $93.5 million. Since the inception of our digital asset treasury strategy in November of '25, we've generated approximately $4.7 million in staking revenue, with our staking activities producing an annualized yield of approximately 5.3%.
Speaker #3: Subsequent to quarter end, as announced last week, we completed the restructuring of certain outstanding convertible debentures. Reducing the related principal balance by approximately $6.8 million.
Speaker #3: The transactions included the full repayment and retirement of debentures held by two institutional investors, and a reduction in the principal amount and amendment of certain terms of a debenture held by a third investor.
Chris Polimeni: The transactions included the full repayment and retirement of debentures held by two institutional investors and a reduction in the principal amount and amendment of certain terms of a debenture held by a third investor. The restructuring was funded through cash on hand and a reduction in the related escrow receivable. We believe this action meaningfully reduces near-term liabilities, strengthens our balance sheet, and enhances our financial flexibility as we execute against our three-pillar strategy. Looking ahead, we are focused on executing our three-pillar strategy while maintaining a prudent approach to capital allocation. We will continue to evaluate high-quality opportunities across the Avalanche ecosystem, Bitcoin mining, and AI and high-performance compute infrastructure with an emphasis on opportunities that can strengthen our operating performance, expand recurring revenue, and generate attractive risk-adjusted returns. We believe these initiatives will enable us to execute our growth and profitability initiatives.
Chris Polimeni: The transactions included the full repayment and retirement of debentures held by two institutional investors and a reduction in the principal amount and amendment of certain terms of a debenture held by a third investor. The restructuring was funded through cash on hand and a reduction in the related escrow receivable. We believe this action meaningfully reduces near-term liabilities, strengthens our balance sheet, and enhances our financial flexibility as we execute against our three-pillar strategy. Looking ahead, we are focused on executing our three-pillar strategy while maintaining a prudent approach to capital allocation. We will continue to evaluate high-quality opportunities across the Avalanche ecosystem, Bitcoin mining, and AI and high-performance compute infrastructure with an emphasis on opportunities that can strengthen our operating performance, expand recurring revenue, and generate attractive risk-adjusted returns. We believe these initiatives will enable us to execute our growth and profitability initiatives.
Speaker #3: The restructuring was funded through cash on hand, and a reduction in the related escrow receivable. We believe this action meaningfully reduces near-term liabilities, strengthens our balance sheet, and enhances our financial flexibility as we execute against our three-pillar strategy.
Speaker #3: Looking ahead, we are focused on executing our three-pillar strategy while maintaining a prudent approach to capital allocation. We will continue to evaluate high-quality opportunities across the Avalanche ecosystem, Bitcoin mining, and AI in high-performance compute infrastructure, with an emphasis on opportunities that can strengthen our operating performance, expand recurring revenue, and generate attractive risk-adjusted returns.
Speaker #3: We believe these initiatives will enable us to execute our growth and profitability objectives. This concludes our prepared remarks, and we will now open it up for questions from those participating in the call.
Chris Polimeni: This concludes our prepared remarks, and we will now open it up for questions from those participating on the call. Operator, back to you.
Chris Polimeni: This concludes our prepared remarks, and we will now open it up for questions from those participating on the call. Operator, back to you.
Speaker #3: Operator, back to you.
Speaker #2: Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star 1 on your telephone keypad.
Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Our first question comes from Derek Greenberg with Maxim Group. Please go ahead.
Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Our first question comes from Derek Greenberg with Maxim Group. Please go ahead.
Speaker #2: A confirmation tone will indicate that your line is in the question queue. You may press *2 if you would like to remove your question from the queue.
Speaker #2: For participants using speaker handset before pressing the star keys. One moment, please, while we poll for questions. And our first question comes from Derek Greenberg, with Maxim Group.
Speaker #2: Please go ahead.
Speaker #3: Hey, yes. My first question is just on the CEO transition. I was wondering if you could talk a little bit about what you're looking for in a candidate, I guess what kind of experience and background they bring, and what kind of qualities they have.
Derek Greenberg: Hey, guys. My first question is just on the CEO transition. I was wondering if you could talk a little bit about what you are looking for in a candidate, I guess what kind of experience and background they would bring, and what kind of qualities they have.
Derek Greenberg: Hey, guys. My first question is just on the CEO transition. I was wondering if you could talk a little bit about what you are looking for in a candidate, I guess what kind of experience and background they would bring, and what kind of qualities they have.
Speaker #4: Sure. We're not commenting publicly much more than we already have on the search itself. But I think our three pillars are quite clear: building the Avalanche digital asset treasury, enhancing our Bitcoin mining operations, and exploring AI infrastructure.
Chris Polimeni: Sure. We are not commenting publicly much more than we already have on the search itself. I think our three pillars are quite clear: building the Avalanche digital asset treasury, enhancing our Bitcoin mining operations, and exploring AI inference infrastructure. So certainly candidates that have experience in and around those spaces are going to be the ones that we are evaluating. But will not make much further comment at this time.
Pete Wylie: Sure. We are not commenting publicly much more than we already have on the search itself. I think our three pillars are quite clear: building the Avalanche digital asset treasury, enhancing our Bitcoin mining operations, and exploring AI inference infrastructure. So certainly candidates that have experience in and around those spaces are going to be the ones that we are evaluating. But will not make much further comment at this time.
Speaker #4: So, certainly, candidates that have experience in and around those spaces are going to be the ones that we're evaluating. But I won't make much further comment at this time.
Speaker #3: Okay. Got it. And then on the third pillar in particular, the AI data centers, I was wondering kind of where your focus lies. I know previously there was kind of a target of powered land at the Alberta location, and one Q27.
Derek Greenberg: Okay, got it. On the third pillar, in particular, the AI data centers, I was wondering where your focus lies. I know previously there was a target of powered land at the Alberta location in 1Q27. I was wondering if that is still a firm plan or if you are looking at everything more opportunistically now. If you could just talk about that.
Derek Greenberg: Okay, got it. On the third pillar, in particular, the AI data centers, I was wondering where your focus lies. I know previously there was a target of powered land at the Alberta location in 1Q27. I was wondering if that is still a firm plan or if you are looking at everything more opportunistically now. If you could just talk about that.
Speaker #3: I was wondering if that's still a firm plan, or if you're kind of looking at everything more opportunistically now. If you could just talk about that.
Speaker #4: Sure. We remain focused and are exploring opportunities in Alberta through our partnership with Boothware, primarily.
Chris Polimeni: Sure, we remain focused in exploring opportunities in Alberta, through a partnership with Blue Flint primarily.
Pete Wylie: Sure, we remain focused in exploring opportunities in Alberta, through a partnership with Blue Flint primarily.
Speaker #3: Okay, got it. On the Redwater inference pilot, could you just talk about how that's progressing and what you're seeing and learning thus far?
Derek Greenberg: Okay, got it. On the Redwater inference pilot, could you just talk about how that is progressing and what you are seeing and learning thus far?
Derek Greenberg: Okay, got it. On the Redwater inference pilot, could you just talk about how that is progressing and what you are seeing and learning thus far?
Speaker #4: Sure. It remains on track, but we have yet to actually deploy the equipment. There was a long lead time to secure all needed assets to commence the pilot itself.
Chris Polimeni: Sure, it remains on track, but we have yet to actually deploy the equipment. There was a long lead time to secure all needed assets to commence the pilot itself. So we are still on track to launch it on schedule, but we have yet to actually get the operating results back from the pilot and look forward to updating the market when we do.
Pete Wylie: Sure, it remains on track, but we have yet to actually deploy the equipment. There was a long lead time to secure all needed assets to commence the pilot itself. So we are still on track to launch it on schedule, but we have yet to actually get the operating results back from the pilot and look forward to updating the market when we do.
Speaker #4: So we're still on track to launch it on schedule, but we have yet to actually get the operating results back from the pilot, and look forward to updating the market when we do.
Speaker #3: Okay, got it. That's it for me for now. I'm going to hop in the queue. Thanks, guys.
Derek Greenberg: Okay. Got it. That's it for me for now. I am going to hop in the queue. Thanks, guys.
Derek Greenberg: Okay. Got it. That's it for me for now. I am going to hop in the queue. Thanks, guys.
Speaker #4: Thank you.
Chris Polimeni: Thank you.
Pete Wylie: Thank you.
Speaker #2: Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. Please disconnect your lines and have a wonderful day.
Operator: Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. Please disconnect your lines and have a wonderful day.
Operator: Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. Please disconnect your lines and have a wonderful day.
Chris Polimeni: Thank you, everyone.
Pete Wylie: Thank you, everyone.
