KULR Technology Group (NYSE: KULR) swings to $51M loss on Bitcoin volatility

(100)

%

Amortization of debt discount

​

​

—

​

​

(82,878)

​

​

82,878

​

(100)

%

Gain on debt extinguishment, net

​

—

​

50,000

​

(50,000)

​

(100)

%

Total Other Income (Expense), net

​

$

(31,500,905)

​

$

8,230,336

​

$

(39,731,241)

​

(483)

%

​

The three month change is primarily attributable to the $28.0 million unfavorable change in the fair value of BTC holdings, reflecting the change in market price of BTC, from $68,228 on April 1, 2026, to $58,554 on June 30, 2026, compared to the change from $82,560 on April 1, 2025, to $107,176 on June 30, 2025.

The six month change is primarily attributable to the $39.0 million unfavorable change in the fair value of BTC holdings, reflecting the change in market price of BTC, from $87,502 on January 1, 2026, to $58,554 on June 30, 2026, compared to the change from $93,384 on January 1, 2025, to $107,176 on June 30, 2025.

Our Bitcoin Acquisition Strategy

In December 2024, we adopted BTC as our primary treasury reserve asset on an ongoing basis, subject to market conditions and our anticipated cash needs. Our strategy included acquiring and holding BTC using cash that exceeds our working capital requirements, and from time to time, subject to market conditions, issuing equity or debt securities or engaging in other capital raising transactions with the objective of using the proceeds to purchase BTC. However, for the foreseeable future, we do not expect to allocate surplus cash to BTC as we prioritize scaling our operating business, including KULR ONE and related products and services. We have not set any specific target for the amount of BTC we seek to hold, and we will continue to monitor market conditions in determining whether to engage in additional BTC transactions. This overall strategy also contemplates that we could periodically leverage or sell BTC for general corporate purposes or in connection with strategies that generate tax benefits in accordance with applicable law, enter into additional capital raising transactions, including those that could be collateralized by our BTC holdings, and consider pursuing strategies to create income streams or otherwise generate funds using our BTC holdings. Through June 30, 2026, KULR had not sold any BTC from its treasury holdings.

On May 7, 2026, our Board of Directors authorized management to sell digital assets as deemed necessary to fund operations and key business priorities in lieu of issuing equity. Accordingly, rather than issue equity under the ATM at current levels, we intend to sell BTC to fund our planned operations and growth initiatives, including scaling our KULR ONE Space architecture, ramping production of our KULR ONE Air products, and advancing development of our KULR ONE MAX battery backup solutions. Subsequent to June 30, 2026, we repaid the remaining outstanding principal and interest balance under our $20.0 million loan agreement with Coinbase, which resulted in the automatic release of the 565 BTC held in the collateral account. To fund the repayment, we sold an aggregate of approximately 333 BTC for total proceeds of approximately $21.5 million, at an average price of approximately $64,467 per BTC, of which we used proceeds of approximately $20.0 million to fund the principal repayment. See Note 13 – Subsequent Events for further information regarding sales of BTC subsequent to June 30, 2026.

As of June 30, 2026, we had contractual commitments with digital asset mining services providers related to the operation of digital asset mining machines. On July 30, 2025, we entered into a one-year mining services agreement, which was not renewed, with a digital asset mining services company, with total committed payments of $2.6 million, of which all were made as of June 30, 2026. In addition, on October 1, 2025, we entered into a two-year mining services agreement with a digital asset mining services company, that included certain non-lease operating expense commitments and the remaining commitments as of June 30, 2026 for future operating expenses associated with this lease totaled $2.1 million (see Note 13 – Subsequent Events, related to the termination of this agreement in July 2026).

For the three and six months ended June 30, 2026, the Company earned 8.44 and 17.23 BTC from mining operations. As of June 30, 2026, we held 1,091.69 BTC with a fair value of $63.9 million, of which 565 BTC with a fair value of $33.1 million were pledged as collateral under the Company’s loan agreement with Coinbase and are presented as digital assets, pledged as collateral, on the condensed consolidated balance sheets.