Axe Compute Inc. (AGPU) 10-K Summary: Fiscal Year Ended December 31, 2025
Business Context and Reporting Period
This Annual Report covers the fiscal year ended December 31, 2025. During this period, the Company underwent a fundamental strategic pivot. Formerly known as Predictive Oncology Inc., the Company changed its name to Axe Compute Inc. on December 11, 2025. The business now operates two primary segments:
- Compute Services and Treasury Management: The Company's new priority, focusing on providing distributed GPU compute capacity for AI workloads via the Aethir network and holding a treasury of Aethir (ATH) tokens.
- Drug Discovery Services (Legacy Business): The former core business involving AI-driven oncology drug discovery. The Company is currently exploring strategic alternatives for this segment, including a potential sale, but it remains classified as continuing operations.
Key Financial Metrics
| Metric | 2025 | 2024 |
|---|---|---|
| Revenue | $125,284 | $84,812 |
| Net Loss | $(233,095,203) | $(12,664,388) |
| Loss from Continuing Operations | $(232,853,647) | $(10,224,655) |
| Cash and Cash Equivalents (Year-End) | $10,790,850 | $611,822 |
| Digital Assets (ATH) Held | $24,439,598 | $0 |
| Digital Asset Receivable (Locked ATH) | $15,485,156 | $0 |
| Accumulated Deficit | $(413,521,474) | $(180,426,271) |
| Stockholders' Equity | $47,716,955 | $(202,610) |
Material Changes vs. Prior Period
- Strategic Pivot and Financing: The Company raised approximately $343.5 million in October 2025 via two Private Investment in Public Equity (PIPE) transactions ($50.8 million cash and $292.7 million notional value in ATH tokens) to fund its new treasury strategy.
- Significant Non-Cash Losses: The massive increase in net loss is primarily driven by non-cash items:
- Loss on Digital Assets: $(152.5 million) due to the decline in fair value of ATH holdings.
- Loss on Derivative Instruments: $(52.7 million) related to the settlement of the Crypto PIPE derivative liability.
- Operating Expenses: General and Administrative (G&A) expenses surged to $25.9 million from $7.2 million, largely due to $15.4 million in stock-based compensation related to warrants issued to a strategic advisor (DNA Holdings Venture).
- Revenue: Revenue increased slightly to $125k, derived entirely from the Legacy Drug Discovery business. The new Compute Services segment generated no revenue in 2025.
- Capital Structure: The Company executed a 1-for-15 reverse stock split in September 2025 to regain compliance with Nasdaq listing requirements.
Guidance, Outlook, Risks, and Unusual Items
Management Commentary and Outlook: Management is focusing resources on the Treasury Strategy and Compute Services. The Company expects operating losses to continue in the near term while scaling these new operations. Liquidity is supported by $10.8 million in cash and significant ATH holdings, though management notes the high volatility of ATH prices.
Key Risks:
- Digital Asset Volatility: The Company's financial results are highly sensitive to the price of ATH. A significant decline in ATH value could materially adversely affect the balance sheet and liquidity.
- Concentration Risk: Assets are highly concentrated in a single digital asset (ATH). Adverse developments specific to the Aethir network could have a disproportionate impact.
- Regulatory Uncertainty: Evolving regulations regarding digital assets, including potential classification as securities or money transmission, pose significant operational risks.
- Legacy Business Disposal: There is no assurance that the strategic review of the Legacy Business will result in a sale, and continued operations incur costs.
Unusual Items:
- Executive Turnover: In February 2026 (subsequent to year-end), the Board terminated CEO Raymond F. Vennare and appointed Christopher Miglino as the new CEO.
- Legal Contingency: The Company is contesting a lawsuit filed by Renovaro regarding a terminated merger agreement; the outcome is uncertain.
Investor Verification Checklist
- ATH Valuation: Verify the current market price of ATH and its impact on the Company's unrealized losses and balance sheet value.
- Liquidity Runway: Assess the Company's ability to fund operations given the negative operating cash flow of ~$9.9 million and reliance on volatile digital assets.
- Legacy Business Status: Monitor updates on the strategic review of the Drug Discovery Services segment to determine if a sale or spin-off is imminent.
- Derivative Accounting: Review the accounting treatment of the Crypto PIPE and Side Letter agreements to understand the magnitude of non-cash losses.
- Compute Revenue: Track the execution of new compute contracts announced in March 2026 to see if the new business model generates actual revenue.