Mawson Infrastructure Group, Inc. (MIGI) Q2 2026 Earnings Report, Transcript and Summary

Good day, and welcome to Big Digital Energy's Second Quarter 2026 Earnings Call. [Operator Instructions] Please note, this call is being recorded. I would now like to turn the call over to Samir Jain, Orange Group Advisors. Please go ahead.

Thank you, operator. Good afternoon, and thank you for joining us for Big Digital Energy's Second Quarter 2026 Earnings Call. Joining me on the call today are Chief Executive Officer, Phil Stanley; Executive Chairman, Josh Kilgore; and Chief Operating Officer, Cody Smith. Before we begin, please note that the information reported on this call speaks only as of today, August 13, 2026, and therefore, any time-sensitive information may no longer be accurate as of the time of any future replay, listening or transcript reading. A replay of today's call will be available by webcast on the company's website, www.bigdigital.energy, and more information on how to access this replay feature will be included in the company's earnings release. Comments on this call may contain forward-looking statements within the meaning of the U.S. federal securities laws. These statements are based on our current expectations and beliefs and are subject to risks and uncertainties that could cause actual results, products, activities or time frames to differ materially. For example, statements suggesting or implying the company's ability or positioning for growth as well as any statements that indicate future dates or time frames are forward-looking statements and inherently uncertain. In some cases, you may identify forward-looking statements by terms such as believe, expect, potential, should, plan or similar terminology, but any statement that is not a statement of historical fact may be a forward-looking statement. These statements reflect the current views of Big Digital Energy's management and are not current guarantees of future performance. Actual results may differ materially from those expressed or implied by any forward-looking statements due to a number of factors, including, among others, those described in the company's filings with the SEC. The company undertakes no obligation to update or revise any forward-looking statements, except as required by law. Please refer to the company's Form 10-K and other filings with the SEC for a discussion of risks and uncertainties that may affect our upcoming results, future plans and project development, among other things. We will discuss certain non-GAAP financial measures during this call. These measures should not be considered a substitute for GAAP results. A reconciliation to comparable GAAP measures is included in our earnings release and SEC filings. With that, I'll pass the call to Big Digital Energy's CEO, Phil Stanley.

Thanks, Samir, and thanks to everyone joining us today. Welcome to Big Digital Energy's inaugural earnings call. A lot happened this quarter, and I want to walk you through exactly what's changed, what we accomplished and where we are taking the business. In early April, Josh, Cody and I assumed leadership of what was then Lawson Infrastructure Group. By end of the month, we expanded and reconstituted the Board of Directors, changed the company name to Big Digital Energy and began trading under our current ticker, BGDE. Like the 3 of us, we know there were many fellow investors, partners and employees disappointed by the legacy of this company. Our decision to rebrand as Big Digital was a direct response to this and reflects our commitment to establishing a new strategic direction and governance framework for the company we are becoming today. Let me also be direct about alignment. Josh, Cody and I beneficially own approximately 29% of this company's common stock. We are far and away the largest shareholders of Big Digital. Not only that, we continue to acquire more stock. In June, members of this team purchased additional shares in the open market. This means that when we make decisions about capital, about dilution, and which deals to sign and which to walk away from, we are making them with the same incentives as you. We believe our significant ownership position creates strong alignment with shareholder interests. So the natural question, what's the plan to achieve our desired goals? Let's start with who we are. We are an owner and procurer of control powered land. We currently have 129 megawatts of online capacity with a pipeline many times that size. At a moment when power, not chips as being the binding constraint on the build-out of artificial intelligence, this positioning is paramount. We've all seen what that constraint has done across the sector. Public Bitcoin miners have now announced over $70 billion in AI and HPC contracts. Core Scientific has a 12-year $10 billion contract with CoreWeave. IREN signed a $9.7 billion AI cloud agreement with Microsoft. TeraWulf's HPC leasing revenue has now surpassed its mining revenue. Hut 8 signed a 15-year lease worth nearly $10 billion on a single Texas campus. The list goes on and on, and the market is searching and paying for companies with energized sites. Big Digital Energy is positioned for the same transition, but trading at only a fraction of the valuation. While we don't agree with a discount, we understand what we have to do is a race it. Our job is to move the theoretical into the practical and execute on transactions, not letters of intent or advanced discussions, closed deals, energized machines and audited numbers. That execution is already well underway. Behind the scenes, our team is engaged on multiple fronts to ensure we're positioned to move quickly as opportunities materialize. We continue to work closely with banking partners and prospective capital providers to secure the financing necessary to develop our existing portfolio and bring additional privately owned controlled power sites under the Big Digital platform. But as I discussed earlier, every financing decision begins with one principle, protecting and enhancing shareholder value. As the company's largest shareholders, we are approaching capital formation with a disciplined focus on minimizing dilution while maximizing long-term equity value. At the same time, we're advancing the engineering, development planning, permitting and other operational work required to bring these sites online as efficiently as possible once the capital is committed. And finally, we're actively engaging with strategic partners and prospective compute offtakers so that as capacity becomes available, we have high-quality counterparties ready to utilize it. None of this is particularly visible from the outside today, but it represents the foundation we're building to convert our pipeline into contracted revenue-generating assets. My colleagues will walk through many of these initiatives in greater detail, but the progress we've made over the past quarter can be summarized in 3 key areas. First, we resolved many of the legacy issues that have hamstrung the company for years. NASDAQ compliance has been restored. The poison pill has been terminated, numerous legal overhangs have been resolved and a stalled legacy AI contract has been formally closed out. Second, we put our existing capacity back to work. The 630 AI colocation agreement is deployed and ramping with new machines arriving weekly. And third, we took meaningful steps forward towards positioning Big Digital for the AI opportunity through the acquisition of our Cleveland, Texas site and our joint venture with 10NetZero in Hood County. Josh and Cody will now walk you through these changes in greater detail. Josh?

Thanks, Phil. It's great to be with everyone today. One of the first commitments we made when we assumed leadership of Big Digital was that this company would operate differently. Governance was the primary reason we engaged with Mawson, and it's the foundation upon which we're building Big Digital. That means being transparent with shareholders, making disciplined capital allocation decisions and earning credibility through actions rather than promises. As Phil discussed, our objective over the past 90 days has been straightforward, stabilize the company, remove the legacy issues that created uncertainty and build a foundation that allows the team to focus on growing the business. I'm pleased to say that we've made meaningful progress on each of these fronts. Let me walk you through a few of the most important milestones to date. First, NASDAQ. On June 17, we received formal confirmation that Big Digital have regained compliance with Listing Rule 5550(b)(1), the stockholders' equity requirement. That deficiency arose under prior management. Since April, we've maintained stockholders' equity above the required threshold. NASDAQ requires us to maintain at least $5 million of stockholders' equity in each quarter for 12 months beginning with the quarter just ended. Our stockholders' equity as of June 30 was $12.4 million, satisfying the first of those requirements. While we cannot guarantee any result, we are fully committed to maintaining compliance with the listing requirements going forward. Second, governance. On June 8, our Board unanimously terminated the stockholder rights agreement or the poison bill, 8 months ahead of its scheduled expiration. With management owning approximately 29% of the company and continuing to purchase shares in the open market, we concluded the plan was no longer serving shareholders. Removing it sends a simple message. We don't intend to hide behind government, structures or corporate defenses. We intend to earn shareholder confidence through transparency, execution and aligned interest. Third, legacy matters. During the quarter, we made meaningful progress resolving issues inherited from prior management, including resolving the dispute with CleanSpark pursuant to a confidential settlement agreement. We also formally closed out the legacy BE Global AI HPC agreement after determining the project would not move forward. More broadly, we recognize that unresolved litigation and legacy matters complicate the Big Digital story and distract from the significant progress we're making across the business today. That's why we've made resolving these issues a priority, allowing investors to focus on the fundamentals and the opportunities ahead rather than the past. Finally, capital allocation. Every capital decision we make begins with one question. Does it create long-term value for our shareholders? During the quarter, we completed a $15 million Series D preferred investment that was funded substantially by members of this management team and affiliated investors. I want to note that this transaction was reviewed and approved in accordance with the company's related party transaction policies. We also continued addressing legacy balance sheet obligations. As Phil noted earlier, this management team owns approximately 29% of the company. The executive team and Board are in full alignment with all shareholders and we'll continue to build Big Digital with all shareholders in mind. I'd now like to pass the baton to Cody Smith, our quant, also serving as our Chief Operating Officer, to walk you through operations.

Thanks, Josh. From an operational standpoint, our focus is straightforward: maximize the value of the assets we own today while positioning them for opportunities Phil described. I'll touch on 3 areas: our current operating platform, how we're increasing the productivity of those assets and the work we've done to improve operational efficiencies across the business. First, our operating platform. Today, Big Digital owns approximately 129 megawatts of energized capacity across our Pennsylvania facilities in the PJM market, one of North America's largest and most attractive wholesale power markets with additional capacity under development. During the second quarter, these assets generated total revenue of $6.2 million, up 28% from the first quarter of 2026. This consisted of $3.5 million from colocation, broadly consistent with the first quarter and $2.6 million from energy management, up 120%. Those results represent the foundation of our business today and provide the cash-generating platform from which we're executing our broader strategy. Second, increasing asset utilization. One of the biggest opportunities we identified after assuming control of the company was that a meaningful portion of our powered infrastructure was underutilized. Our objective has been simple, put those assets to work. That's what our agreement with 630 AI accomplishes. Rather than allowing approximately 75 megawatts of capacity to remain dormant while we pursue longer-term AI opportunities, we've deployed that capacity under a structure that required no capital investment from Big Digital and no debt to our balance sheet and provides the company with 100% of the operating cash flows, while our partner participates through equity that only becomes valuable if shareholder value is created. Importantly, we don't view Bitcoin mining as the end destination for these assets. We view it as the highest and best use of that capacity today, a way to monetize infrastructure that would otherwise sit idle while generating meaningful cash flow to support our transition toward AI and HPC. As additional machines are deployed, we expect those cash flows to continue increasing while preserving the flexibility to redeploy power toward higher-value AI applications as opportunities emerge. Third, operational efficiency. Since taking control of the company, we've conducted a comprehensive review of our operations from top to bottom. Every vendor relationship, every service agreement, every operating expense and every process has been evaluated with one objective, ensuring the business is operating as efficiently as possible. That work is ongoing, but we've already identified opportunities to streamline operations, eliminate redundant costs and improve the overall efficiency of the platform. Examples of this include decommissioning older machines that were unprofitable, reducing unnecessary head count and renegotiating contracts that were inappropriately sized. The result is a leaner organization that is better positioned to convert revenue into cash flow and generate stronger returns on every megawatt we own. With that, I'll turn it back to Phil for some closing thoughts.

Let me close by talking about where we're headed and how Big Digital becomes a leading AI infrastructure company. Our road map is straightforward. Building an AI data center platform requires 4 things: first, securing powered sites; second, executing and developing those sites; third, establishing strategic partnerships with customers and infrastructure providers; and fourth, accessing capital in a disciplined manner. Every initiative we've undertaken since assuming leadership has been designed to advance one or more of these objectives. The first pillar is securing powered infrastructure. Over the past several months, we've taken meaningful steps to expand our portfolio of powered sites. That includes our acquisition of the Cleveland, Texas property, which adds another strategically located powered asset to our portfolio and provides an attractive foundation for future AI and HPC development. We've also completed the acquisition of the Hood County site through our 50-50 joint venture with 10NetZero. Located less than 40 miles from Dallas-Fort Worth, the approximately 50-acre campus currently has 17 megawatts of energized capacity with a pathway to 111 megawatts of utility power, subject to ERCOT validation and other approvals and factors and the potential to expand to approximately 300 megawatts through behind-the-meter generation. More importantly, the acquisition moves Hood County from a prospective opportunity to a controlled development asset that we can begin advancing today. The second pillar is execution. Owning powered land is only the beginning. Our team is actively advancing engineering, site planning, permitting and development and activities across the assets that they are positioned to move efficiently from powered land into revenue-generating AI infrastructure. Our objective is to reduce execution risk and shorten the time line from acquisition to customer deployment. The third pillar is strategic partnerships. Developing AI infrastructure is a collaborative effort. We actively engaged with prospective development partners, infrastructure providers and AI HPC customers to ensure that as capacity becomes available, we have the relationships necessary to accelerate deployment and maximize long-term value. A material development that demonstrates the progress we're making is the letter of intent announced this week between Texas Load House, our 50-50 joint venture with 10NetZero and Tensor IQ for the Hood County campus. For us, this is about much more than reserving 17 megawatts of capacity. It represents an important step toward turning Hood County from powered infrastructure into a purpose-built AI campus with a prospective customer and a defined path toward development. The framework contemplates an initial deployment of 7,748 NVIDIA D300 GPUs with current planning assumptions targeting availability in the second quarter of 2027, subject to design, engineering, financing and approvals and definitive documentation. We believe the potential economics illustrate the kind of value we are working to create across the Big Digital platform. Based on the indicative terms in the LOI and assuming full utilization, the arrangement is expected to generate approximately $546 million in aggregate power lease-related revenue to Texas Load House over the initial 15-year term, with the potential to reach approximately $1.07 billion over 25 years if both extension options are exercised on the same indicative terms. The LOI is nonbinding, and there is still important work ahead before definitive agreements are signed. But we believe this is a meaningful validation of the strategy we've laid out today, secure attractive powered sites, bring the right partners and customers to those sites and transform that infrastructure into long-duration revenue-generating AI assets. This is the opportunity we see at Hood County, and it is the model we intend to pursue across the Big Digital portfolio. Finally, capital. We've engaged Northland Capital Markets to help evaluate financing alternatives across our portfolio, including site-level financing structures that maximize shareholder value. As we've discussed throughout today's call, we'll continue pursuing the capital required to build this platform while remaining disciplined stewards of shareholder capital and minimizing unnecessary dilution. When you step back, the road map is clear: expand our portfolio of powered infrastructure, advance development, establish strategic partnerships and finance growth responsibly. Those are the milestones investors should measure us against over the coming quarters. We're still in the early innings, but we believe Big Digital has assembled the leadership team, the powered assets and the strategic road map to capitalize on one of the most compelling infrastructure opportunities in the market today. With that, let's move to questions.

Thanks, Phil. Over the past 6 months, several questions have been posed to management through e-mails, social media and in-person meetings. These are among the topics we have heard most frequently from shareholders, analysts and other interested parties, and we just thought it would make sense to address them here today. So I will direct this first question towards Phil. You burned approximately $17 million in the first quarter and ended with only $2.5 million in cash. How should investors think about liquidity and the going concern disclosure?

You'll see the current quarter's cash balance and stockholders' equity in our financial statements, and those numbers tell a much different story than where the company stood when the management team assumed control. A significant portion of that first quarter cash burn related to legacy matters and onetime items that are not representative of the business today. Since taking over, we've strengthened the balance sheet, restored NASDAQ compliance, raised capital through Series D financing and importantly, begun generating additional cash flow from previously underutilized assets. You'll see the going concern language remain in our filing. We want to address that directly. Accounting standards require management to evaluate conditions over a defined period. What has changed underneath that disclosure is the operating trajectory, the capital structure and our ability to execute. We believe those improvements provide a much stronger foundation than existed just a few months ago.

Great. Thank you. I will direct this next question to Josh. Managements on both sides of the 630 AI transaction. How can shareholders be confident the terms are fair?

That's a fair question and exactly why governance matters. Every related party aspect of the transaction was reviewed by our Independent Audit Committee. Any interested directors refuse themselves entirely from the approval process. Additionally, any related party transaction is reviewed under the company's related party transaction policy and applicable SEC requirements. But beyond the process, we think the economics speak for themselves. Big Digital deployed no capital, incurred no debt, received 100% of the operating cash generated under the arrangement, and our partners' return comes primarily through equity that only becomes valuable if all shareholders benefit through appreciation in the stock price. We encourage investors to review the filings because we believe the governance process and transaction structure are both transparent.

Okay. Thank you. I'm actually going to direct this next question to you, Josh, as well. How should investors think about potential acquisitions of powered sites from management affiliates?

The answer is exactly the same as the 630 AI transaction question. Every related party transaction will be reviewed by our Independent Audit Committee. Interested directors will refuse themselves and all required SEC disclosures will be made. Where appropriate, we will also seek independent valuation support. The reason we're evaluating these opportunities is simple. They provide access to high-quality powered infrastructure that would otherwise be very difficult to source in today's market, but no opportunity is worth compromising governance. Those standards won't change.

Perfect. All right. Let's bring Cody in. So Cody, several of your peers have already announced large AI infrastructure contracts. Why should investors believe Big Digital can successfully execute this strategy?

Thanks, Samir. We think investors should judge us on execution, not announcements. Our road map is straightforward, secure powered sites, advance deployment, establish strategic partnerships and finance growth responsibly. That's exactly what we've been doing. We've expanded our power infrastructure portfolio. We're advancing engineering and development activities. We're engaged with strategic partners and prospective customers, and we've retained Northland to help evaluate financing alternatives. We're not interested in announcing transactions before they're real. As we said throughout today's call, we'd rather be measured by executed milestones than expectations.

Excellent. Excellent. Okay. Back to Phil. How do you fund AI data center development at your current market capitalization without significant shareholder dilution?

We intend to evaluate a range of financing alternatives, including project level and asset level financing structures. Our strategy is to utilize project-level financing, strategic partnerships, customer-backed development structures and other asset level financing alternatives whenever appropriate. That's one of the reasons we've engaged Northland Capital Markets. We've also heard questions regarding the loan made to our joint venture partner in connection with the Hood County acquisition. That loan was structured to facilitate completion of the acquisition and have defined repayment terms. We view it as part of completing an important strategic transaction, not as a permanent source of project financing. Most importantly, management owns nearly 30% of this company. We experienced dilution alongside every other shareholder, so protecting per share value remains central to every financing decision we make.

Thanks, Phil. I'm going to direct the next question to you as well. Can you clarify the capacity figures at Hood County? Investors have seen references to 17 megawatts, 111 megawatts and even 300 megawatts.

Absolutely, because we know this has created a lot of confusion. Those aren't 3 different estimates. There are 3 stages of the same development road map. Today, the site has approximately 17 megawatts of energized capacity that's operational. The next phase is expanding utility service to approximately 111 megawatts, subject to ERCOT validation. Beyond that, because the site has existing natural gas infrastructure, there's potential to add behind-the-meter generation that could increase total campus capacity to approximately 300 megawatts, subject to engineering, permitting and commercial considerations. It's also important to remember that Hood County is owned through a 50-50 joint venture. The capacity figures referred to the overall project, while Big Digital participates economically through its ownership interest.

Thank you. Josh, I'm going to direct this one to you. How comfortable are you with the $5 million stockholder equity requirement from NASDAQ?

Our June 30 stockholders' equity exceeded the required threshold, satisfying the first quarterly test. Maintaining compliance remains an important operating objective for management. We monitor that metric continuously and have multiple tools available to support the balance sheet, including improved operating cash generation, preferred capital where appropriate and continued execution on legacy balance sheet initiatives. We won't speculate on hypothetical scenarios, but investors should know this is something we actively manage every day.

Right. And then also as an extension of that, can you walk investors through the current share count and how you're thinking about future dilution?

We'll provide a complete reconciliation in our filings showing the evolution of the share count, including ATM activity, the Series D financing and securities issued under commercial agreements. What's more important is our philosophy. Going forward, our objective is to finance growth intelligently and protect long-term per share value. Every major financing structure we've implemented is intended to align management with shareholders and minimize unnecessary dilution.

Great. Cody, a couple for you. First one, how should investors think about the company's different revenue streams as you transition towards AI?

Today, our business consists of 3 primary operating segments: colocation, energy management and self-mining. AI infrastructure isn't yet a material contributor to revenue because we're still developing that platform. Over time, we expect the mix to evolve as AI and HPC customers begin utilizing our power and infrastructure. Our objective is straightforward: allocate every megawatt to its highest return use while maintaining healthy cash generation throughout that transition. That's exactly how we view the existing mining business. It's generating cash today while preserving flexibility for higher-value AI applications tomorrow.

Okay. And then also, Cody, are you moving away from Bitcoin mining?

No. We view Bitcoin mining as a bridge into our AI strategy. Today's mining represents the highest return use of portions of our power infrastructure, while AI capacity is being developed. It generates meaningful cash flow, improves utilization of our assets and helps support a broader transition to AI infrastructure. As higher return AI opportunities become available, we'll allocate power accordingly. Our philosophy is simple. Every megawatt should be deployed to its highest economic return.

All right. Josh, several members of management participated in the Series D financing through affiliate entities. How can shareholders be confident those transactions were conducted appropriately?

Good question, Samir. We believe management investing alongside shareholders is a positive signal because our interests are directly aligned with long-term value creation. At the same time, related party transactions require heightened governance, as we've already talked about. Every transaction involving management or affiliated entities is reviewed by our Independent Audit Committee. Interested directors refuse themselves from the approval process and all required disclosures are made under SEC rules. Our governance standards don't change because management is participating. In fact, they've become more important.

All right. And then the last question, I'm going to direct this towards Phil, and it's about the recently announced Tensor agreement. Is the LOI nonbinding? And what are the key remaining conditions or contingencies for converting it into definitive agreements, including financing, technical diligence and regulatory approvals?

Thanks, Samir. As publicly disclosed, the LOI is nonbinding and establishes a framework for the parties to negotiate definitive agreements. It shouldn't be characterized as completed customer contract or committed revenue stream. The things we have to work through now are design and engineering, securing the financing that we need, obtaining the final required approvals and negotiating and executing definitive documentation. We have not publicly disclosed a detailed closing checklist or a time line for executing definitive agreements, so we would not speculate beyond the release. We will provide further updates through appropriate public disclosure channels as material developments occur.

[Operator Instructions] I'm showing no questions. I'd like to turn the call over to Josh Kilgore for closing remarks.

Thank you. On behalf of the Big Digital executive team and Board, I'd just like to say thank you to everyone for participating today and also for your support and our endeavors forward. We've got a lot of fun ahead of us, and we look forward to showing you what we're all about execution. Thank you.

Thank you. This concludes the conference call. Thank you for your participation. You may now disconnect. Good day.