SATO Technologies Corp. Announces Q3 2025 Earnings and Strategic Outlook

12/01/2025 – 06:13 PM

Toronto, Ontario – SATO Technologies Corp. (TSXV: SATO) (OTCQB: CCPUF), a provider of high‑density compute infrastructure, announced its unaudited financial results for the three and nine months ended September 30, 2025.

Full financial statements and Management’s Discussion and Analysis (MD&A) are filed on SEDAR+. All amounts are in Canadian dollars unless otherwise noted.

Q3 2025 Highlights

Despite the after‑effects of the April 2024 Bitcoin halving and record network difficulty, SATO delivered quarter‑over‑quarter improvements in revenue, profitability, and operational stability.

Key results

• Revenue of $3.34 million, up 28% from Q3 2024
• 21 BTC mined, down 32% from 31 BTC in Q3 2024 (halving and higher difficulty)
• Gross profit of $381,566, versus a gross loss of $(544,387) in Q3 2024
• Net loss of $(284,424), an improvement from $(1,717,056) in Q3 2024
• Compute Power Profit $921,602 (Q3 2024: $199,656)
• Adjusted EBITDA $333,505 (Q3 2024: $(353,728))
• Digital assets (including restricted) $1.46 million, comprising 9 BTC at quarter‑end
• Cash balance $640,621

Center One achieved less than 1% downtime during the quarter, driven by recent electrical upgrades and efficiency gains from the company’s DataMan platform.

Liquidity measures

To preserve cash in the post‑halving environment and maintain flexibility while advancing the AI transition, management is taking several steps:

• A lender‑supported three‑month grace period (beginning November 2025) deferring principal and interest payments on the long‑term loan
• Executive compensation deferral and selective contractor reductions
• Potential sale of non‑core equipment and continued cost optimisation
• Temporary down‑clocking of roughly 40% of the mining fleet to curb power consumption, improving daily profitability despite a lower hashrate

These actions extend SATO’s runway as the company evaluates financing options and strategic alternatives.

Strategic initiatives and AI transition

SATO is executing a multi‑phase plan to repurpose part of Center One into high‑density AI compute:

• Initial GPU deployment, pending funding: a staged rollout starting with ~200 GPUs, scalable to over 2,000 units
• AI Factory 1: engineering, liquid‑cooling design, and power planning are underway
• Financing: the company has received preliminary, non‑binding expressions of interest for debt and equity financing to fund the expansion, subject to due diligence and definitive agreements
• Digital Asset Treasury (DAT) strategy: continued development of a combined Bitcoin and AI‑linked digital‑asset treasury to complement future contracted AI revenues

Management commentary

“Q3 reflects the reality of the post‑halving environment: unprecedented difficulty and significant Bitcoin volatility,” said Chairman & CEO Romain Nouzareth. “We anticipated this. We reduced costs, worked proactively with our lender to align payment schedules with our new strategy, and accelerated our AI plan so we can pivot toward contracted, recurring revenue.”

“With nearly a decade of Bitcoin experience, I know discipline and adaptability matter most. Our actions extend our runway and position SATO to evolve from a Bitcoin miner into a high‑density AI infrastructure provider supported by our Digital Asset Treasury strategy.”

Deep‑dive analysis

From a capital‑allocation perspective, SATO’s liquidity package provides a modest buffer, but the cash position of $640,621 remains modest relative to the capital intensity of both Bitcoin mining and AI compute. The three‑month payment deferral reduces immediate outflows, yet the company must secure additional financing to fund the GPU expansion and associated cooling infrastructure. Investors should monitor the progress of the AI Factory 1 engineering effort, as liquid‑cooling efficiency will be a key determinant of the cost per compute unit in the AI market, where power consumption is a primary cost driver.

The shift from pure mining to a hybrid compute model aligns with broader industry trends. As Bitcoin block rewards diminish post‑halving, miners are increasingly repurposing hash‑rate capacity for AI workloads, which command higher price points per teraflop. SATO’s staged rollout—starting with 200 GPUs—offers a scalable path, but execution risk remains significant: GPU supply constraints, cooling‑system engineering challenges, and the need to secure long‑term AI service contracts. A successful transition could improve margin stability, evidenced by the 28% revenue growth despite a 32% drop in BTC mined.

From a technology standpoint, the company’s DataMan platform—responsible for real‑time power management and workload orchestration—may provide a competitive edge in handling heterogeneous workloads (mining vs. AI inference/training). If the platform can dynamically allocate power between legacy ASIC rigs and GPU clusters, SATO could optimise energy costs, a critical factor given the volatility of electricity prices in its operating region.

Risk factors continue to loom. Bitcoin price volatility and network difficulty directly affect mining revenue, while the nascent AI compute market presents demand uncertainty and fierce competition from established cloud providers. Supply‑chain bottlenecks for GPUs and liquid‑cooling hardware could delay the scaling roadmap, and any regulatory changes in cryptocurrency mining or AI services could materially impact operations.

Financial tables (selected)

Non‑GAAP financial measures

Compute Power Profit is a non‑GAAP metric that isolates gross profit from core compute operations, excluding depreciation, site‑specific hosting costs, and other ancillary revenue. Adjusted EBITDA excludes finance income/expense, taxes, depreciation, amortisation, stock‑based compensation, and other non‑recurring items, providing a clearer view of operating performance before financing and tax effects.

Cautionary statement regarding forward‑looking information

Statements in this release that are not historical facts are forward‑looking and involve risks and uncertainties, including but not limited to: the ability to secure financing on acceptable terms; adoption rates for AI compute services; supply‑chain constraints for GPUs and cooling equipment; Bitcoin price volatility and network difficulty; regulatory changes affecting cryptocurrency or AI operations; and execution risk in transitioning from mining to AI infrastructure. Actual results could differ materially from those expressed or implied in these statements.