Empery Digital Inc.

What they do

Empery Digital historically operated a powersports/vehicle business but has shifted to a digital asset treasury strategy, holding Bitcoin and generating income through BTC derivatives (short-term put and call contracts). It is also pursuing AI data center opportunities, including a strategic partnership with Cardinal Power LLC to fund and develop AI infrastructure, and plans to convert a Midwest property into an AI data center. The company maintains a smaller revenue stream from its legacy product sales and electric bicycle-related operations.

Revenue drivers

• Digital asset treasury operations — Generates income through Bitcoin derivatives (short-term put and call contracts) and potential gains from BTC holdings; not separately quantified but central to strategy.
• Legacy powersports/vehicle sales — Remaining revenue from product sales; quarterly revenue has declined sharply, from $198,301 (Q3 2025) to $80,019 (Q2 2026).
• AI data center and infrastructure — Potential future revenue from leasing the Midwest property and participating in Cardinal's West Texas data center campus; no revenue recognized to date.

Recent performance

For the three months ended June 30, 2026, revenue was $80,019, down from $198,301 in Q3 2025 and $124,171 in Q4 2025, but up from $225,702 in Q1 2026. Annual revenue in 2025 was $974,977, a sharp drop from $4.0M in 2024. Net loss widened to $150.1M in 2025 from $45.5M in 2024, and diluted EPS was $-8.12 for 2025. Operating cash flow was negative $17.8M in 2025. As of June 30, 2026, the company had $3.6M cash, $55.0M long-term debt, and $113.4M shareholder equity.

Strategy

Management is implementing a digital asset treasury strategy to increase Bitcoin per share and drive stockholder value, while using derivatives to generate income. It is partnering with Cardinal Power LLC to identify and fund AI infrastructure opportunities, including a potential AI data center conversion of a Midwest property and a proposed data center campus in West Texas. The company is also repositioning its powersports business and evaluating financing arrangements, including share repurchases and inventory financing to generate positive net interest income.

Risks

• Bitcoin price volatility — The company's stock price is highly correlated to the price of Bitcoin and other digital assets; significant decreases in BTC value could severely impact financial condition.
• Rising losses and cash burn — Net loss expanded to $150.1M in 2025, operating cash flow was negative $17.8M, and cash declined to $3.6M, raising liquidity concerns.
• AI/data center execution risk — Plans for the Midwest property and Cardinal partnership are subject to closing, permit, power availability, and tenant demand risks, with no revenue yet.
• Regulatory uncertainty on crypto — Treatment of crypto assets for U.S. and foreign tax purposes and evolving regulations create legal and compliance exposure.

Outlook

Management expects continued focus on its digital asset treasury strategy, with expectations for Bitcoin per share growth and income from BTC derivatives. It is pursuing data center opportunities, including the Midwest property conversion and West Texas campus, and expects to generate positive net interest income from inventory financing. However, the company cautions that results are subject to Bitcoin price volatility, regulatory changes, and execution of partnership agreements.