Company: SLNH
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023503
Chunk: 92

Company: Soluna Holdings, Inc
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 92
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lett Packard Enterprise Company (“HPE”), offering GPU
resources to startups, enterprises, and GPU marketplaces for a fee. As further described in our Annual Report, we terminated our agreement
with HPE.

We
are currently developing new infrastructure projects intended to support AI and HPC workloads. These efforts include engagement with
potential joint venture partners, conducting site and feasibility studies, securing access to power and land, and performing other early-stage
development activities.

Our
first planned AI/HPC colocation project is Project Kati, which is in active construction, and breaking ground near the end of
the third quarter 2025. Additional projects, including the announced Project Rosa, are also in progress. For the fiscal year 2024
and the nine months ended September 30, 2025, we generated minimal revenue from our HPC Business.

Demand
Response Business

We
provide demand response services to grid operators and utilities by leveraging our data centers as dispatchable energy resources. In
select states where we operate, our data centers are enrolled in ancillary services programs that support grid reliability.

Under
these programs, we commit to reducing a facility’s power consumption to a predetermined level when called upon by the grid operator.
In return, we receive compensation for maintaining this dispatch capability, provided we meet specific performance criteria. For example,
to qualify for compensation in a given period—typically monthly—the data center must meet minimum uptime and availability
requirements.

For
the three and nine months ended September 30, 2025, our Demand Response Business represented approximately 5% and 5% of total revenue.
For the three and nine months ended September 30, 2024, our Demand Response Business represented approximately 6% and 5% of total revenue.
2026 compensation rates are trending notably downward from increased participation in the program.

Operations
and Project Pipeline

As
of September 30, 2025, we operate approximately 105 MW of capacity across two active sites located in Murray, Kentucky and Silverton,
Texas. An additional 18 MW is under construction at our D2 project site, and as of September 30, 2025, we had over 900 MW of facilities
in advanced development or near shovel-ready status. In total, our project pipeline includes over 2.8 gigawatts (GW) of renewable energy-powered
data center developments.

46

A
summary of our pipeline, current and anticipated operating locations are as follows (as of September 30,