SATO Technologies Corp. Reports Second Quarter 2026 Results and Completes Settlement of Senior Secured Debt

SATO Technologies Corp. (TSXV: SATO) (OTCQB: CCPUF) ("SATO" or the "Company") today announced its unaudited financial results for the three and six months ended June 30, 2026. Readers are directed to the Company's unaudited condensed interim consolidated financial statements and Management's Discussion and Analysis for the three and six months ended June 30, 2026 (the " MD&A ") for full details, which are available on SEDAR+ ( www.sedarplus.ca ) and at www.bysato.com . All amounts are in Canadian dollars unless otherwise stated.

Q2 2026 Key Highlights

Subsequent to quarter-end, on August 24, 2026, the Company completed a loan settlement agreement with Sygnum Bank AG, eliminating all of the Company's senior secured indebtedness and the associated future debt-service requirements. The Company expects to recognize a gain on settlement of approximately $2,020,000 in the third quarter of 2026. The Company announced a non-brokered private placement of up to $1,500,000, a portion of the proceeds of which is intended to fund the cash payment under the settlement.

The Company entered into a non-binding letter of intent with the Gelephu Mindfulness City Authority in Bhutan for a phased, renewable-energy-powered AI data-centre campus intended to serve demand for AI compute capacity in India and the broader region. The Company continued discussions with several parties regarding the potential use of Center One for AI and HPC data-centre operations.

Up to approximatively 50% of the mining fleet remained down-clocked in response to prevailing Bitcoin prices, network difficulty, electricity costs and equipment efficiency.

Second Quarter 2026 Financial Highlights

Revenue of $1,135,976, down 62% from $3,019,539 in Q2 2025

11 Bitcoin (" BTC ") mined, compared with 22 BTC in Q2 2025

Gross loss of $(490,713), compared with a gross loss of $(110,379) in Q2 2025

Net loss of $(922,517), compared with a net loss of $(766,454) in Q2 2025

Compute Power Profit (Loss) 1 of $(127,438), compared with $431,505 in Q2 2025

Adjusted EBITDA 2 of $(597,157), compared with $(108,804) in Q2 2025

Cash of $275,315 and a working capital deficiency of $(2,747,398) at June 30, 2026

Digital assets (including restricted digital assets) 3 of $608,633 at June 30, 2026, compared with $829,827 at December 31, 2025

Six Months Ended June 30, 2026

Revenue of $2,487,521, down 58% from $5,979,413

24 BTC mined, compared with 44 BTC

Gross loss of $(1,056,159), compared with gross profit of $188,018

Net loss of $(2,189,828), compared with a net loss of $(1,651,896)

Operations and Liquidity

Bitcoin production declined to 11 BTC in the quarter from 22 BTC in Q2 2025. The principal driver was the Company's decision to down-clock approximately up to 50% of its mining fleet, taking offline equipment that was not expected to operate profitably at prevailing Bitcoin prices and electricity costs. Network conditions were also less favourable, with average Bitcoin network hashrate near all-time highs at approximately 922 EH/s at June 30, 2026, compared with approximately 843 EH/s a year earlier. The average market price of BTC was approximately US$70,500 during the quarter, compared with approximately US$99,500 in the first half of 2025.

Cost of operations decreased to $1,626,689 (Q2 2025: $3,129,918) and general and administrative expenses decreased to $460,236 (Q2 2025: $542,147).

At June 30, 2026 the Company had cash of $275,315 and a working capital deficiency of $(2,747,398). The completion of the settlement subsequent to quarter-end removes the Company's senior secured borrowings from current liabilities. The Company's financial statements continue to disclose a material uncertainty that may cast significant doubt on its ability to continue as a going concern. The Company's AI and HPC strategy will require additional financing, customer commitments and infrastructure investment.

Settlement of Senior Secured Debt On August 24, 20...