{"url_path":"/sec/dgxx/10-q/2026/cover-page","section_key":"cover-page","section_title":"Cover Page","topic":"sec","document":{"doc_type":"10-Q","doc_date":"2026-05-15","source_url":"https://www.sec.gov/Archives/edgar/data/1854368/0001213900-26-057115-index.html","accession_number":"0001213900-26-057115","cik":"0001854368","ticker":"DGXX","issuer_name":"Digi Power X Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1854368/0001213900-26-057115-index.html","primary_entity_key":"0001854368","primary_entity_name":"Digi Power X Inc."},"word_count":10291,"has_tables":true,"body_markdown":"UNITED\nSTATES\n\nSECURITIES AND EXCHANGE COMMISSION\n\nWashington, D.C. 20549\n\n \n\n \n\n \n\nFORM\n10-Q\n\n \n\n \n\n \n\n☒ **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**\n\n \n\nFor\nthe quarterly period ended March 31, 2026\n\n \n\nOR\n\n \n\n☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**\n\n \n\nFor\nthe transition period from _____ to _____\n\n \n\nCommission\nfile number 001-41236\n\n \n\n \n\n \n\nDigi\nPower X Inc.\n\n(Exact\nName of Registrant as Specified in its Charter)\n\n \n\n \n\n \n\n**British\nColumbia, Canada**\n  **Not Applicable**\n\n(State or other jurisdiction of   (I.R.S. Employer\n\nincorporation or organization)   Identification No.)\n\n     \n\n**110 Yonge Street, Suite 1601**    \n\n**Toronto, Ontario**   **M5C 1T4**\n\n(Address of Principal Executive Offices)   (Zip Code)\n\n \n\n(818)\n280-9758\n\nRegistrant’s telephone number, including area code\n\n \n\nSecurities\nregistered pursuant to Section 12(b) of the Act:\n\n \n\n**Title\nof each class**\n  **Trading Symbol(s)**   **Name of each exchange on which registered**\n\nSubordinate Voting Shares   DGXX   Nasdaq Capital Market\n\n \n\nIndicate\nby check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange\nAct of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)\nhas been subject to such filing requirements for the past 90 days.\n\n \n\nYes\n☒ No ☐\n\n \n\nIndicate\nby check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405\nof Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was\nrequired to submit such files).\n\n \n\nYes\n☒ No ☐\n\n \n\nIndicate\nby check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting\ncompany, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”\n“smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.\n\n \n\nLarge accelerated filer ☐ Accelerated filer ☐\n\nNon-accelerated filer ☒ Smaller reporting company ☒\n\nEmerging growth company ☒    \n\n \n\nIf\nan emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying\nwith any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐\n\n \n\nIndicate\nby check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).\n\n \n\nYes\n☐ No ☒\n\n \n\nAs of May 15, 2026, the registrant had 90,420,824 subordinate voting\nshares issued and outstanding and 3,333 proportionate voting shares issued and outstanding.\n\n \n\n \n\n \n\n \n\n \n\n \n\nTable\nof Contents\n\n \n\n \n**Page**\n\n[Part I - Financial Information](#a_001)\n1\n\n[Unaudited Condensed Interim Consolidated Balance Sheets](#a_002)\n2\n\n[Unaudited Condensed Interim Consolidated Statements of Operations and Comprehensive Loss](#a_003)\n3\n\n[Unaudited Condensed Interim Consolidated Statements of Cash Flows](#a_004)\n4\n\n[Unaudited Condensed Interim Consolidated States of Changes in Shareholder’s Equity](#a_005)\n5\n\n[Notes to Unaudited Condensed Consolidated Financial Statements](#a_006)\n6\n\n[Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations](#a_007)\n24\n\n[Item 3. Quantitative and Qualitative Disclosures About Market Risk](#a_008)\n36\n\n[Item 4. Controls and Procedures](#a_009)\n36\n\n \n \n\n[Part II - Other Information](#a_010)\n36\n\n[Item 1. Legal Proceedings](#a_011)\n36\n\n[Item 1A. Risk Factors](#a_012)\n36\n\n[Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](#a_013)\n37\n\n[Item 3. Defaults Upon Senior Securities](#a_014)\n37\n\n[Item 4. Mine Safety Disclosures](#a_015)\n37\n\n[Item 5. Other Information](#a_016)\n38\n\n[Item 6. Exhibits](#a_017)\n38\n\n \n\n[SIGNATURES](#a_018)\n39\n\n \n\ni\n\n \n\n \n\nCAUTIONARY\nNOTE REGARDING FORWARD-LOOKING STATEMENTS\n\n \n\nCertain statements contained in this Quarterly Report on Form 10-Q\n(the “Quarterly Report”) that reflect Digi Power X Inc.’s (“we,” “us,” “our,” the\n“Corporation,” or “Digi Power”) current views with respect to future events and financial performance, business\nstrategies, expectations for our business and any other statements of a future or forward-looking nature, constitute “forward-looking\nstatements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, and “forward-looking information”\nwithin the meaning of applicable Canadian securities laws, or collectively, forward-looking statements. We intend such forward-looking\nstatements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of\n1933, as amended (the “Securities Act”), Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange\nAct”), and forward-looking information within the meaning of Canadian securities laws. All statements other than statements of historical\nfacts contained in this Quarterly Report may be forward-looking statements. These forward-looking statements include statements about\nour financial condition, results of operations, earnings outlook, prospects, and the treatment of the Corporation under government regulatory\nand taxation regimes. Forward-looking statements appear in a number of places in this Quarterly Report including, without limitation,\nin the section titled “*Management’s Discussion and Analysis of Financial Condition and Results of Operations.*”\n\n \n\nIn\naddition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including\nany underlying assumptions, are forward-looking statements. Forward-looking statements can often be identified by forward-looking words,\nsuch as “anticipate,” “believe,” “expect,” “plan,” “intend,” “estimate,”\n“may,” “potential” and “will,” or similar words suggesting future outcomes or other expectations,\nbeliefs, plans, objectives, assumptions, intentions or statements about future events or performance. The forward-looking statements\ncontained in this Quarterly Report are based on our current expectations and beliefs concerning future developments and their potential\neffects on us. You should not place undue reliance on these forward-looking statements. We cannot assure you that future developments\naffecting the Corporation will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties\n(some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from\nthose expressed or implied by these forward-looking statements. Should one or more of these risks or uncertainties materialize, or should\nany of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements.\nSome factors that could cause actual results to differ include, but are not limited to, the following:\n\n \n\n●The Corporation’s development\nof a Tier III data center and other infrastructure projects involves significant risks, many of which are beyond the Corporation’s\ncontrol;\n\n   \n\n●The loss of our\nexisting customer and/or our inability to gain new customers may have an adverse effect on the Corporation’s business, financial\ncondition and results of operations;\n\n   \n\n●The Corporation’s business\nmay be adversely impacted if the Corporation is unable to fulfill its obligations pursuant to the Cerebras Agreement (as defined below).\nFor more information regarding the Cerebras Agreement, *see*Note 20 to the Corporation’s Condensed Interim Consolidated Financial\nStatements for the three months ended March 31, 2026 and 2025 – “*Subsequent Events*”;\n\n   \n\n●The Corporation’s inability\nto execute on our evolving business model and strategy, including our ability to diversify and expand into the market for high-performance\ncomputing (“HPC”) and artificial intelligence (“AI”) solutions and data centers;\n\n \n\nii\n\n \n\n \n\n●The Corporation’s inability\nto respond to anticipated demand for large data centers may have an adverse impact on the Corporation’s business;\n\n   \n\n●Regulatory changes or actions\nrelated to data centers and/or cryptocurrencies may alter the nature of an investment in the Corporation in a manner that adversely affects\nthe Corporation’s operations;\n\n   \n\n●The Corporation is subject to\nrisks associated with the Corporation’s need for significant electrical power. The Corporation’s data center and mining operations\nrequire electrical power to be available at commercially feasible rates. Government regulators may potentially restrict the ability of\nelectricity suppliers to provide electricity to mining operations;\n\n   \n\n●The Corporation faces competition\nfrom other data center and cryptocurrency companies;\n\n   \n\n●The Corporation’s data\ncenters and/or cryptocurrency inventory may be exposed to cybersecurity threats and hacks;\n\n   \n\n●The value of cryptocurrencies may be subject\nto momentum pricing risk;\n\n   \n\n●Cryptocurrency exchanges and other trading venues\nare relatively new and, in most cases, largely unregulated and may therefore be more exposed to fraud and failure;\n\n   \n\n●Acceptance and/or widespread use of cryptocurrency\nis uncertain;\n\n   \n\n●If the Corporation is unable\nto insure the remainder of its mined digital currency, its business and/or its financial condition may be adversely affected;\n\n   \n\n●The Corporation may be required\nto sell its cryptocurrency portfolio to pay its expenses;\n\n   \n\n●Technological obsolescence and\ndifficulty obtaining hardware may adversely impact the Corporation’s operating results and financial condition;\n\n   \n\n●The Corporation does not currently\npay cash dividends, and, therefore, the Corporation’s shareholders will not be able to receive a return on their subordinate voting\nshares (“SV Shares”) unless they sell them;\n\n   \n\n●The SV Shares are subject to\nvolatility risk, and there is no guarantee that an active or liquid market will be sustained for the SV Shares;\n\n   \n\n●The Corporation has a limited history of operations\nand is in the early stage of development;\n\n   \n\n●Ineffective management of growth could result\nin a failure to sustain the Corporation’s progress;\n\n   \n\n●There are significant legal, accounting, and\nfinancial costs of being a publicly traded company, which may reduce the resources available for the Corporation to develop its data centers\nand/or deploy on its cryptocurrency mining operations;\n\n \n\niii\n\n \n\n \n\n   \n\n●The Corporation may be unable to obtain additional\nfinancing on acceptable terms or at all;\n\n   \n\n●The Corporation may be subject to tax consequences\nthat could reduce the Corporation’s profitability;\n\n \n\n●The Corporation may be exposed to risks from\nexchanging currencies, including currency exchange fees.\n\n   \n\n●The Corporation may be subject to litigation;\n\n   \n\n●Uninsured or uninsurable risks could result in significant financial liabilities;\n\n   \n\n●Exposure to environmental liabilities and hazards may result in the imposition\nof fines, penalties and restrictions;\n\n   \n\n●The Corporation’s success is largely dependent on the performance of\nthe Corporation’s management and executive officers;\n\n   \n\n●The Corporation may be unable to attract, develop and retain its key personnel\nand establish adequate succession planning;\n\n   \n\n●Certain directors and officers may have a conflict\nof interest between their duties owed to the Corporation and their interest in other personal or business ventures;\n\n   \n\n●Recent changes in U.S. political leadership and\neconomic policies, as well as any future policy changes, may create uncertainty that materially affects the Corporation’s business\nand financial performance; and\n\n   \n\n ●Current or future geopolitical events may have an adverse impact on\nthe Corporation’s business.\n\n \n\nThe foregoing list of factors and other risks detailed from time to\ntime in our reports filed with the U.S. Securities and Exchange Commission (the “SEC”) is not exhaustive. See “Part\nII, Item 1A – Risk Factors.” Those factors and the other risk factors described therein are not necessarily all of the important\nfactors that could cause actual results or developments to differ materially from those expressed in any of our forward-looking statements.\nOther unknown or unpredictable factors also could harm our results. Consequently, our actual results could be materially different from\nthe results described or anticipated by our forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections\nand may be better or worse than anticipated. Given these uncertainties, you should not place undue reliance on the above forward-looking\nstatements. Forward-looking statements represent our estimates and assumptions only as of the date that they were made. We expressly disclaim\nany duty to provide updates to forward-looking statements, and the estimates and assumptions associated with them, after the date of this\nreport, in order to reflect changes in circumstances or expectations or the occurrence of unanticipated events except to the extent required\nby applicable securities laws.\n\n \n\niv\n\n \n\n \n\nPart\nI - Financial Information\n\n \n\n \n\n \n\n \n\n \n\nDIGI\nPOWER X INC.\n\n \n\nCONDENSED\nINTERIM CONSOLIDATED FINANCIAL STATEMENTS\n\n \n\nFOR\nTHE THREE MONTHS ENDED MARCH 31, 2026 AND 2025\n\n \n\n(EXPRESSED\nIN UNITED STATES DOLLARS)\n\n \n\n(UNAUDITED)\n\n \n\n \n\n \n\n \n\n \n\n1\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Condensed Interim Consolidated Balance Sheets**\n\n**(Expressed in United States Dollars, except number of shares)**\n\n \n\n  \n\n**As at**\n\n**March 31,\n2026**\n  \nAs at\n\nDecember 31,\n\n2025 \n\n  \n(Unaudited)  \n  \n\nASSETS \n   \n  \n\nCurrent assets \n   \n  \n\nCash and cash equivalents \n$57,813,811  \n$78,478,759 \n\nDigital currencies \n 13,561,396  \n 14,814,180 \n\nCurrent portion of amounts receivable and other assets \n 1,592,557  \n 1,576,272 \n\nOther receivable \n 44,000  \n 44,000 \n\nTotal current assets \n 73,011,764  \n 94,913,211 \n\n  \n    \n   \n\nProperty, plant and equipment, net \n 26,211,575  \n 23,005,900 \n\nIntangible asset \n 894,032  \n 926,339 \n\nAmounts receivable and other assets, net of current portion \n 24,273,884  \n 13,724,798 \n\nInvestments \n 2,543,331  \n 1,543,331 \n\nTotal assets \n$126,934,586  \n$134,113,579 \n\n  \n    \n   \n\nLIABILITIES AND SHAREHOLDERS’ EQUITY \n    \n   \n\n  \n    \n   \n\nCurrent liabilities \n    \n   \n\nAccounts payable and accrued liabilities \n$3,716,253  \n$6,350,923 \n\nWarrant liabilities \n 2,076,760  \n 2,297,930 \n\nTotal current liabilities \n 5,793,013  \n 8,648,853 \n\n  \n    \n   \n\nDeposits payable \n 2,203,526  \n 2,203,526 \n\nTotal liabilities \n 7,996,539  \n 10,852,379 \n\nShareholders’ equity \n    \n   \n\nSubordinate voting shares, no par value, unlimited shares authorized; 69,807,452 shares and 69,427,788 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively\n\n \n \n-\n  \n \n-\n \n\nProportionate voting shares, no par value, unlimited shares authorized; 3,333 shares and 3,333 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively\n\n \n \n-\n  \n \n-\n \n\nAdditional paid-in capital \n 218,733,180  \n 216,409,130 \n\nAccumulated deficit \n (93,522,952) \n (88,870,607)\n\nAccumulated other comprehensive income (loss), net \n (7,206,106) \n (4,277,323)\n\nTotal shareholders’ equity attributable to shareholders \n 118,004,122  \n 123,261,200 \n\nNon-controlling interest \n 933,925  \n \n-\n \n\nTotal shareholders’ equity \n 118,938,047  \n 123,261,200 \n\nTotal liabilities and shareholders’ equity \n$126,934,586  \n$134,113,579 \n\n \n\nThe accompanying notes are an integral part of these unaudited condensed\ninterim consolidated financial statements \n\n \n\n2\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Condensed Interim Consolidated Statements of Operations and Comprehensive Loss**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\nThree Months Ended March 31, \n2026  \n2025 \n\nRevenue \n   \n  \n\nDigital currency mining and staking \n$47,727  \n$765,876 \n\nColocation services \n 3,026,908  \n 5,082,795 \n\nSale of energy \n 3,716,711  \n 3,427,916 \n\nTotal revenue \n 6,791,346  \n 9,276,587 \n\n  \n    \n   \n\nCost of revenue \n    \n   \n\nCost of revenue \n (6,142,878) \n (8,622,310)\n\nDepreciation and amortization \n (1,450,104) \n (2,172,791)\n\nGross loss \n (801,636) \n (1,518,514)\n\n  \n    \n   \n\nOperating expenses \n    \n   \n\nGeneral and administrative expenses \n (4,333,962) \n (2,714,302)\n\nForeign exchange gain (loss) \n 2,959,327  \n (62,875)\n\nGain on sale of digital currencies \n 2,418  \n 337,009 \n\nLoss on revaluation of digital currencies \n (3,764,103) \n (446,975)\n\nTotal operating expenses \n (5,136,320) \n (2,887,143)\n\n  \n    \n   \n\nOther income (expenses) \n    \n   \n\nOther income \n \n-\n  \n 750 \n\nNet financial income \n 500,778  \n 6,923 \n\nGain from change in fair value of warrant liability \n 784,833  \n 2,764,723 \n\nTotal other income \n 1,285,611  \n 2,772,396 \n\n  \n    \n   \n\nNet loss for the period attributable to common shareholders \n (4,652,345) \n (1,633,261)\n\nForeign currency translation adjustment \n (2,928,783) \n 27,294 \n\nComprehensive loss for the period attributable to common shareholders \n$(7,581,128) \n$(1,605,967)\n\n  \n    \n   \n\nNet loss for the period attributable to: \n    \n   \n\nCommon shareholders of the Corporation \n (4,652,345) \n (1,633,261)\n\nNon-controlling interests \n \n-\n  \n \n-\n \n\n  \n    \n   \n\nComprehensive loss for the period attributable to: \n    \n   \n\nCommon shareholders of the Corporation \n (7,581,128) \n (1,605,967)\n\nNon-controlling interests \n \n-\n  \n \n-\n \n\n  \n    \n   \n\nNet loss per common share: \n    \n   \n\nBasic and diluted \n$(0.07) \n$(0.05)\n\n  \n    \n   \n\nWeighted average number of common shares outstanding: \n    \n   \n\nBasic and diluted \n 69,636,328  \n 34,966,831 \n\n \n\nThe accompanying notes are an integral part of these unaudited condensed\ninterim consolidated financial statements \n\n \n\n3\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Condensed Interim Consolidated Statements of Cash Flows**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\nThree Months Ended March 31, \n2026  \n2025 \n\nOperating activities \n   \n  \n\nNet loss for the period \n**$****(4,652,345****)** \n$(1,633,261)\n\nAdjustments for: \n    \n   \n\nDigital currencies items \n 1,252,784  \n (4,469,226)\n\nDepreciation of right-of-use assets \n \n-\n  \n 25,549 \n\nDepreciation and amortization \n 1,450,104  \n 2,159,800 \n\nInterest on lease liabilities \n \n-\n  \n 2,648 \n\nShare based compensation \n 1,352,975  \n 828,763 \n\nGain (loss) from change in fair value of warrant liability \n (784,833) \n (2,764,723)\n\nAccretion on liability \n \n-\n  \n 566 \n\nForeign exchange loss (gain) \n (2,964,157) \n 21,168 \n\nWorking capital items \n (2,051,916) \n (4,276,284)\n\nNet cash used in operating activities \n (6,397,388) \n (10,105,000)\n\n  \n    \n   \n\nInvesting activities \n    \n   \n\nPurchases and deposits on property, plant and equipment \n (15,172,560) \n (782,106)\n\nAcquisition of investment \n (1,000,000) \n \n-\n \n\nDigital currencies traded for cash \n \n-\n  \n 4,598,203 \n\nNet cash (used in) provided by investing activities \n (16,172,560) \n 3,816,097 \n\n  \n    \n   \n\nFinancing activities \n    \n   \n\nProceeds of shares issued for cash, net of issuance costs \n \n-\n  \n 6,482,509 \n\nReturn of proceeds to non-controlling interest \n \n-\n  \n (1,000,000)\n\nContributions from non-controlling interest \n 1,905,000  \n \n-\n \n\nRepayment of loans payable \n \n-\n  \n (78,130)\n\nLease payments \n \n-\n  \n (15,000)\n\nNet cash provided by financing activities \n 1,905,000  \n 5,389,379 \n\n  \n    \n   \n\nNet change in cash \n (20,664,948) \n (899,524)\n\nCash and cash equivalents, beginning of period \n 78,478,759  \n 1,703,896 \n\nCash and cash equivalents, end of period \n$57,813,811  \n$804,372 \n\n \n\nThe accompanying notes are an integral part of these unaudited condensed\ninterim consolidated financial statements \n\n \n\n4\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Condensed Interim Consolidated Statement of Changes in Shareholders’ Equity**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\n  \nNumber of shares (note 9)  \n   \n   \nAccumulated  \n   \n  \n\n  \nSubordinate\n\nVoting Shares  \nProportionate\n\nVoting Shares  \nAdditional\n\npaid-in\n\ncapital  \nAccumulated\n\nDeficit  \nOther\n\nComprehensive\n\nIncome  \nNon-Controlling\n\nInterest  \nTotal \n\nBalance as of December 31, 2024 \n 33,011,600  \n 3,333  \n$90,011,906  \n$(60,514,384) \n$(7,487,193) \n$279,430  \n$22,289,759 \n\nRestricted share units converted to common shares \n 792,669  \n -  \n \n-\n  \n \n-\n  \n \n-\n  \n \n-\n  \n \n-\n \n\nShares issued for cash \n 2,503,601  \n -  \n 4,123,056  \n \n-\n  \n \n-\n  \n \n-\n  \n 4,123,056 \n\nCost of issue - cash \n -  \n -  \n (126,998) \n \n-\n  \n \n-\n  \n \n-\n  \n (126,998)\n\nShare based compensation \n -  \n -  \n 828,763  \n \n-\n  \n \n-\n  \n \n-\n  \n 828,763 \n\nDissolution of non-controlling interest \n -  \n -  \n (721,270) \n \n-\n  \n \n-\n  \n (279,430) \n (1,000,700)\n\nNet loss for the period \n -  \n -  \n \n-\n  \n (1,633,261) \n \n-\n  \n \n-\n  \n (1,633,261)\n\nOther comprehensive loss for the period \n -  \n -  \n \n-\n  \n \n-\n  \n 27,294  \n \n-\n  \n 27,294 \n\nBalance as of March 31, 2025 \n 36,307,870  \n 3,333  \n$94,115,457  \n$(62,147,645) \n$(7,459,899) \n$\n-\n  \n$24,507,913 \n\n  \n    \n    \n    \n    \n    \n    \n   \n\nBalance as of December 31, 2025 \n 69,427,788  \n 3,333  \n$216,409,130  \n$(88,870,607) \n$(4,277,323) \n$\n-\n  \n$123,261,200 \n\nRestricted share units converted to common shares \n 379,664  \n -  \n \n-\n  \n \n-\n  \n \n-\n  \n \n-\n  \n \n-\n \n\nShare based compensation \n -  \n -  \n 1,352,975  \n \n-\n  \n \n-\n  \n \n-\n  \n 1,352,975 \n\nChanges to ownership of subsidiary \n -  \n -  \n 971,075  \n \n-\n  \n \n-\n  \n 933,925  \n 1,905,000 \n\nNet loss for the period \n -  \n -  \n \n-\n  \n (4,652,345) \n \n-\n  \n \n-\n  \n (4,652,345)\n\nOther comprehensive loss for the period \n -  \n -  \n \n-\n  \n \n-\n  \n (2,928,783) \n \n-\n  \n (2,928,783)\n\nBalance as of March 31, 2026 \n 69,807,452  \n 3,333  \n$218,733,180  \n$(93,522,952) \n$(7,206,106) \n$933,925  \n$118,938,047 \n\n \n\nThe accompanying notes are an integral part of\nthese unaudited condensed interim consolidated financial statements\n\n \n\n5\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\n**1.****Nature\nof operations**\n\n \n\nDigi\nPower X Inc. (together with its subsidiaries, Digihost International, Inc., DGX Holding, LLC, World Generation X, LLC, and US Data Centers,\nInc., the “Corporation” or “Digi Power”) is an innovative energy infrastructure corporation that develops data\ncenters to drive the expansion of sustainable energy assets.\n\n \n\nThe Corporation was incorporated in British Columbia, Canada, on February\n18, 2017 and operated under the name “Digihost Technology Inc.” until March 6, 2025. The Corporation’ subordinate voting\nshares were listed on the TSX Venture Exchange, and the Corporation’s subordinate voting shares were uplisted to Cboe Canada on\nFebruary 27, 2026. The Corporation is listed on Cboe Canada and the NASDAQ trading under the trading symbols DGX and DGXX, respectively.\nThe head office of the Corporation is located at 218 NW 24th Street, 2nd Floor, Miami, Florida 33127.\n\n \n\nThese\nunaudited condensed interim consolidated financial statements of the Corporation were reviewed, approved and authorized for issue by\nthe Board of Directors of the Corporation (the “Board”) on May 15, 2026.\n\n** **\n\n**2.****Basis\nof Presentation and Summary of Significant Accounting Policies**\n\n \n\n(a)Statement\nof compliance\n\n \n\nThe accompanying unaudited condensed interim consolidated financial\nstatements included herein have been prepared in conformity with generally accepted accounting principles in the United States (“GAAP”)\nand under the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim reporting.\nThe accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments,\nthat are necessary to present fairly the Corporation’s financial position, results of operations, and cash flows. The condensed\nconsolidated results of operations are not necessarily indicative of the results that may occur for the full fiscal year. Certain information\nand footnote disclosures of the Corporation normally included in the financial statements prepared in accordance with GAAP have been condensed\nor omitted under the SEC’s rules and regulations. These unaudited condensed interim consolidated financial statements should be\nread in conjunction with the audited financial statements and accompanying notes thereto for the year ended December 31, 2025, included\nin the Corporation’s Annual Report on Form 10-K, as originally filed with the SEC on March 31, 2026 and as amended on April 27,\n2026 (the “2025 Annual Report”).\n\n \n\nPrior\nto January 1, 2026, the Corporation was a foreign private issuer reporting its financial statements under IFRS Accounting Standards as\nissued by the International Accounting Standards Boards. These unaudited condensed interim consolidated financial statements, for all\nperiods, are presented in accordance with U.S. GAAP. Any reference in these notes to applicable guidance is meant to refer to the authoritative\nguidance found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”).\n\n \n\nThese\nunaudited condensed interim consolidated financial statements have been prepared on a going concern basis, meaning that the Corporation\nwill continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course\nof operations.\n\n \n\n6\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\n(b)Basis\nof consolidation\n\n \n\nThese\nunaudited condensed interim consolidated financial statements include the accounts of Digi Power, its wholly owned subsidiaries, Digihost\nInternational, Inc., DGX Holdings, LLC, and World Generation X, and its partially owned subsidiary, US Data Centers, Inc., with the Corporation\nowning 51% of such entity as of March 31, 2026. Subsidiaries are consolidated from the date of acquisition, being the date on which the\nCorporation obtains control and continues to be consolidated until the date that such control ceases. Control is achieved when an investor\nhas power over an investee to direct its activities, exposure to variable returns from an investee, and the ability to use the power\nto affect the investor’s returns. All intercompany transactions and balances have been eliminated upon consolidation. Foreign exchange\ngains and losses on cross-currency intercompany loan balances that are not of a long-term investment nature are included in foreign exchange\ngain (loss). Net earnings or loss and each component of other comprehensive income are attributed to the shareholders of the Corporation\nand to the non-controlling interests. Total comprehensive income is attributed to the shareholders of the Corporation and to the non-controlling\ninterests even if this results in the non-controlling interests having a deficit balance on consolidation.\n\n \n\n(c)Segment\nreporting\n\n \n\nThe\nreporting segments are identified on the basis of information that is reviewed by the chief executive officer of the Corporation (the\n“CEO”) to make decisions about resources to be allocated and assess its performance. Accordingly, for management purposes,\nthe Corporation has four reporting segments namely, cryptocurrency mining, sales of energy, colocation services, and AI data centers.\n\n \n\nOperating\nsegments are defined as components of an entity for which discrete financial information is available that is regularly reviewed by the\nchief operating decision maker (“CODM”), which is comprised of the Corporation’s President and the CEO. The CODM uses\nsegment gross profit (loss), working capital, and EBITDA to assess the performance of, manage the operations of, and allocate capital\nand operational resources to the Corporation’s four reportable segments. EBITDA is defined as earnings before interest expense,\ntaxes, depreciation and amortization.\n\n \n\n(d)Critical\naccounting judgements, estimates and assumptions\n\n \n\nThe\npreparation of these financial statements in conformity with U.S. GAAP requires management to make certain estimates, judgements and\nassumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of\nexpenses during the reporting period. Actual outcomes could differ from these estimates. These financial statements include estimates\nthat, by their nature, are uncertain. The impacts of such estimates are pervasive throughout the financial statements and may require\naccounting adjustments based on future occurrences. Revisions to accounting estimates are recognized in the year in which the estimate\nis revised and future years if the revision affects both current and future years. These estimates are based on historical experience,\ncurrent and future economic conditions and other factors, including expectations of future events that are believed to be reasonable\nunder the circumstances.\n\n** **\n\n7\n\n \n\n** **\n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\nSignificant\nassumptions about the future that management has made that could result in a material adjustment to the carrying amounts of assets and\nliabilities, in the event that actual results differ from assumptions made, relate to, but are not limited to, the following:\n\n** **\n\n**Significant\njudgements**\n\n* *\n\n*(i)**Income\nfrom digital currency mining*\n\n \n\nThe\nCorporation recognizes income from digital currency mining from the provision of transaction verification services within digital currency\nnetworks, commonly termed “cryptocurrency mining”. As consideration for these services, the Corporation receives digital\ncurrency from each specific network in which it participates (“coins”). Income from digital currency mining is measured based\non the fair value of the coins received. The fair value is determined using the average price of the coin on the date of contract inception.\nThe coins are recorded on the unaudited condensed interim consolidated balance sheets, as digital currencies, at their fair value less\ncosts to sell and re- measured at each reporting date. Revaluation gains or losses, as well as gains or losses on the sale of coins for\ntraditional (fiat) currencies are included in profit or loss in accordance with the Corporation’s treatment of its digital currencies\nas a traded commodity.\n\n* *\n\n*(ii)**Income,\nvalue added, withholding and other taxes*\n\n \n\nThe\nCorporation is subject to income, value added, withholding and other taxes. Significant judgement is required in determining the Corporation’s\nprovisions for taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary\ncourse of business. The Corporation recognizes liabilities for anticipated tax audit issues based on estimates of whether additional\ntaxes will be due. The determination of the Corporation’s income, value added, withholding and other tax liabilities requires interpretation\nof complex laws and regulations. The Corporation’s interpretation of taxation law as applied to transactions and activities may\nnot coincide with the interpretation of the tax authorities. A deferred tax asset is recognized only to the extent that it is probable\nthat future taxable income will be available against which the asset can be utilized. All tax related filings are subject to government\naudit and potential reassessment subsequent to the financial statement reporting period.\n\n \n\nDevelopments\nin an audit, litigation, or the relevant laws, regulations, administrative practices, principles, and interpretations could have a material\neffect on our operating results or cash flows in the period or periods for which that development occurs, as well as for prior and subsequent\nperiods. We recognize the tax benefit from an uncertain tax position in accordance with ASC 740, Income Taxes, only if it is more likely\nthan not that the tax position will be sustained on examination by the applicable taxing authority, including resolution of the appeals\nor litigation processes, based on the technical merits of the position. The tax benefits recognized in the unaudited condensed interim\nconsolidated financial statements from such a position are measured based on the largest benefit for each such position that has a greater\nthan fifty percent likelihood of being realized upon ultimate resolution. Many factors are considered when evaluating and estimating\nthe tax positions and tax benefits. Such estimates involve interpretations of regulations, rulings, case law, etc. and are inherently\ncomplex. Our estimates may require periodic adjustments and may not accurately anticipate actual outcomes as resolution of income tax\ntreatments in individual jurisdictions typically would not be known for several years after completion of any fiscal year. We believe\nthe judgements and estimates discussed above are reasonable. However, if actual results are not consistent with our estimates or assumptions,\nwe may be exposed to losses or gains that could be material.\n\n* *\n\n*(iii)**Impairment\nof property, plant and equipment*\n\n \n\nManagement\napplies judgement in assessing whether indicators of impairment exist for property, plant and equipment, including assets under construction.\n\n \n\nThe\nCorporation reviews its property and equipment and intangible assets for impairment whenever events or changes in circumstances indicate\nthe carrying value of an asset may not be recoverable. Impairment exists when the carrying value of the Corporation’s asset exceeds\nthe related estimated undiscounted future cash flows expected to be derived from the asset. If impairment exists, the carrying value\nof that asset is adjusted to its fair value. This assessment requires consideration of internal and external factors such as changes\nin the expected use of assets, operating performance, market conditions, and strategic plans. As at March 31, 2026, management concluded\nthat no impairment indicators existed for the Corporation’s property, plant and equipment.\n\n** **\n\n8\n\n \n\n** **\n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n** **\n\n**Significant\nestimates**\n\n* *\n\n*(i)**Useful\nlives of property, plant and equipment*\n\n \n\nDepreciation\nof data miners and equipment are an estimate of its expected life. In order to determine the useful life of computing equipment, assumptions\nare required about a range of computing industry market and economic factors, including required hashrates, technological changes, availability\nof hardware and other inputs, and production costs.\n\n* *\n\n*(ii)**Warrant\nliability*\n\n \n\nThe Corporation uses Black Scholes method or the Monte Carlo simulation\ntechnique to determine the fair value of the warrant liability. The Black Scholes method requires significant judgement in determining\nthe fair value such as volatility and risk-free rate. A change in these inputs could lead to significant change in the fair value of the\nwarrant liability.\n\n \n\n(e)Recently\nannounced accounting pronouncements not yet adopted\n\n \n\nThe\nCorporation continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new\naccounting pronouncement may affect the Corporation’s financial reporting, the Corporation undertakes an analysis to determine\nany required changes to its unaudited condensed interim consolidated financial statements and assures that there are proper controls\nin place to ascertain that the Corporation’s unaudited condensed interim consolidated financial statements properly reflect the\nchange.\n\n \n\nIn November 2024, the FASB issued ASU No. 2024-03, Income Statement\n- Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.\nASU 2024-03 requires additional disclosures of certain expenses in the notes of the financial statements, to provide enhanced transparency\ninto the expense captions presented on the unaudited condensed interim Consolidated Statements of Operations. Additionally, in January\n2025, the FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40),\nto clarify the effective date of ASU 2024-03. The new standard is effective for the Corporation for its annual periods beginning after\nDecember 15, 2026 and for interim periods beginning after December 15, 2027, with early adoption permitted. The Corporation is currently\nevaluating the impact of adopting the standard.\n\n \n\nThere\nwere no other significant updates to the recently issued accounting standards which may be applicable to the Corporation. Although there\nare several other new accounting pronouncements issued or proposed by the FASB, the Corporation does not believe any of those accounting\npronouncements have had or will have a material impact on its financial position or operating results.\n\n** **\n\n9\n\n \n\n** **\n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n** **\n\n**3.****Digital\ncurrencies**\n\n \n\nThe\nCorporation’s holdings of digital currencies consist of the following:\n\n \n\n  \nAs at\nMarch 31,\n2026  \nAs at\nDecember 31,\n2025 \n\nBitcoin \n$11,430,207  \n$11,812,321 \n\nEthereum \n 2,131,189  \n 3,001,859 \n\n  \n$13,561,396  \n$14,814,180 \n\n \n\nThe\ncontinuity of digital currencies was as follows:\n\n \n\n  \nNumber of\nEthereum  \nAmount  \nNumber of\nBitcoin  \nAmount  \nTotal \n\nBalance, December 31, 2024 \n \n-\n  \n$\n-\n  \n 48  \n$4,525,416  \n$4,525,416 \n\nDigital currencies mined and staked \n 7  \n 27,128  \n 34  \n 3,496,250  \n 3,523,378 \n\nDigital currencies received from colocation services \n \n-\n  \n \n-\n  \n 156  \n 15,649,009  \n 15,649,009 \n\nAcquisition of digital currencies \n 1,002  \n 4,245,883  \n 16  \n 1,911,631  \n 6,157,514 \n\nDigital currencies traded for cash \n \n-\n  \n \n-\n  \n (111) \n (10,972,014) \n (10,972,014)\n\nDigital currencies paid for services \n \n-\n  \n \n-\n  \n (9) \n (843,665) \n (843,665)\n\nDigital currencies remitted as per Miner Agreement \n \n-\n  \n \n-\n  \n (1) \n (145,199) \n (145,199)\n\nGain on sale of digital currencies \n \n-\n  \n \n-\n  \n \n-\n  \n 1,029,017  \n 1,029,017 \n\nRevaluation adjustment \n \n-\n  \n (1,271,152) \n \n-\n  \n (2,838,124) \n (4,109,276)\n\nBalance, March 31, 2025 \n \n \n  \n \n \n  \n \n \n  \n \n \n  \n \n \n \n\nBalance, December 31, 2025 \n 1,009  \n 3,001,859  \n 133  \n 11,812,321  \n 14,814,180 \n\nDigital currencies mined and staked(1) \n 4  \n 10,405  \n \n-\n  \n 37,322  \n 47,727 \n\nDigital currencies received from colocation services \n \n-\n  \n \n-\n  \n 34  \n 2,576,804  \n 2,576,804 \n\nDigital currencies paid for services \n \n-\n  \n \n-\n  \n (1) \n (115,630) \n (115,630)\n\nGain on sale of digital currencies \n \n-\n  \n \n-\n  \n \n-\n  \n 2,418  \n 2,418 \n\nRevaluation adjustment \n -  \n (881,075) \n -  \n (2,883,028) \n (3,764,103)\n\nBalance, March 31, 2026 \n 1,013  \n$2,131,189  \n 166  \n$11,430,207  \n$13,561,396 \n\n \n\n(1)During\nthe three months ended March 31, 2026, the Corporation staked 4 Ethereum.\n\n \n\nThe\ncost bases of the Corporation’s holdings of digital currencies consist of:\n\n \n\n  \nAs at\n\nMarch 31,\n\n2026  \nAs at\n\nDecember 31,\n\n2025 \n\nBitcoin \n$14,313,234  \n$14,301,245 \n\nEthereum \n 3,012,264  \n 4,273,011 \n\n  \n$17,325,498  \n$18,574,256 \n\n \n\n10\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\n**4.****Amounts\nreceivable and other assets**\n\n \n\n  \nAs at\n\nMarch 31,\n\n2026  \nAs at\n\nDecember 31,\n\n2025 \n\nUtility deposits \n$3,370,975  \n$5,228,270 \n\nEquipment deposit \n 20,902,909  \n 8,496,528 \n\nPrepaid expenses \n 63,451  \n 56,585 \n\nAccounts receivable \n \n-\n  \n 1,136,972 \n\nOther receivable \n 1,529,106  \n 382,715 \n\n  \n 25,866,441  \n 15,301,070 \n\nLong-term deposits and prepaid expenses \n (24,337,335) \n (13,724,798)\n\n  \n$1,529,106  \n$1,576,272 \n\n \n\nThe\nCorporation uses the single expected credit loss impairment model, which is based on changes in credit quality since initial application.\n\n \n\nThe\nCorporation assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days past due. The Corporation\nconsiders a financial asset to be in default when the borrower is unlikely to pay its credit obligations to the Corporation in full or\nwhen the financial asset is more than 90 days past due.\n\n \n\nThe\ncarrying amount of a financial asset is written off (either partially or in full) to the extent that there is no realistic prospect of\nrecovery. This is generally the case when the Corporation determines that the debtor does not have assets or sources of income that could\ngenerate sufficient cash flows to repay the amounts subject to the write-off.\n\n** **\n\n**5.****Property,\nplant and equipment**\n\n \n\n  \n**Land and buildings(1)**  \nData miners  \n**Equipment (1)**  \nLeasehold\nimprovement  \n**Power plant in use(2)**  \nTotal \n\nCost \n   \n   \n   \n   \n   \n  \n\nDecember 31, 2024 \n$7,094,339  \n$31,895,779  \n$24,592,207  \n$1,079,542  \n$5,234,577  \n$69,896,444 \n\nAdditions \n 1,718,524  \n 1,100,550  \n 1,962,022  \n \n-\n  \n 1,405,657  \n 6,186,753 \n\nDisposal \n \n-\n  \n (14,041,665) \n \n-\n  \n \n-\n  \n \n-\n  \n (14,041,665)\n\nDecember 31, 2025 \n 8,812,863  \n 18,954,664  \n 26,554,229  \n 1,079,542  \n 6,640,234  \n 62,041,532 \n\nAdditions \n 1,429,804  \n \n-\n  \n 2,903,093  \n \n-\n  \n 290,577  \n 4,623,474 \n\nMarch 31, 2026 \n$10,242,667  \n$18,954,664  \n$29,457,322  \n$1,079,542  \n$6,930,811  \n$66,665,006 \n\nAccumulated depreciation \n    \n    \n    \n    \n    \n   \n\nDecember 31, 2024 \n$491,218  \n$31,496,438  \n$13,061,778  \n$506,900  \n$696,367  \n$46,252,701 \n\nDepreciation \n 403,233  \n 399,341  \n 5,469,650  \n 105,318  \n 447,054  \n 6,824,596 \n\nImpairment \n \n-\n  \n (14,041,665) \n \n-\n  \n \n-\n  \n \n-\n  \n (14,041,665)\n\nDecember 31, 2025 \n 894,451  \n 17,854,114  \n 18,531,428  \n 612,218  \n 1,143,421  \n 39,035,632 \n\nDepreciation \n 123,957  \n 91,713  \n 1,048,935  \n 26,330  \n 126,864  \n 1,417,799 \n\nMarch 31, 2026 \n$1,018,408  \n$17,945,827  \n$19,580,363  \n$638,548  \n$1,270,285  \n$40,453,431 \n\nNet carrying value \n    \n    \n    \n    \n    \n   \n\nAs at December 31, 2025 \n$7,918,412  \n$1,100,550  \n$8,022,801  \n$467,324  \n$5,496,813  \n$23,005,900 \n\nAs at March 31, 2026 \n$9,224,259  \n$1,008,837  \n$9,876,959  \n$440,994  \n$5,660,526  \n$26,211,575 \n\n \n\n(1)As\nat March 31, 2026, the Corporation made capital investments related to the development of its Tier III AI data centers segment (*see*\nNote 17 to the Condensed Interim Consolidated Financial Statements) and are included within property, plant and equipment. Depreciation\nis not recognized on the AI data center assets that are not yet available for their intended use. The carrying amount of these assets\nis $5,013,601.\n\n** **\n\n11\n\n \n\n** **\n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n** **\n\n**6.****Intangible\nasset**\n\n \n\nIntangible asset relates to the right-of-use of an electric power facility\nfor a period of 156 months. As at March 31, 2026, there were 81 months remaining of the amortization period.\n\n \n\n  \nAs at\nMarch 31,\n2026  \nAs at\nDecember 31,\n2025 \n\nCost \n$1,680,000  \n$1,680,000 \n\nAccumulated amortization \n (785,968) \n (753,661)\n\nIntangible assets, net \n$894,032  \n$926,339 \n\n \n\nDuring\nthe three months ended March 31, 2026, the Corporation recognized amortization expense of $32,307 (as compared to $32,308 for the three\nmonths ended March 31, 2025), related to intangible assets.\n\n** **\n\n**7.****Investment**\n\n \n\n  \n\n**As at**\n\n**March 31,\n2026**\n  \nAs at\n\nDecember 31,\n\n2025 \n\nBalance, beginning of period \n$1,543,331  \n$900,844 \n\nAdditional investment (ii) \n 1,000,000  \n \n-\n \n\nChange in fair value of investment \n \n-\n  \n 642,487 \n\nBalance, end of period \n$2,543,331  \n$1,543,331 \n\n \n\n(i) In December 2021, the Corporation entered\ninto an agreement for a Secured Convertible Promissory Note (the “Note”) with principal of $800,000. The Note accrued interest\nat a rate of 6% per annum, with 3% payable in cash every calendar quarter and 3% payable in notes. The Note was converted into Series\nC Preferred Stock (the “Shares”) of the issuer effective October 1, 2023, with 8,000 warrants issued to the Corporation. The\nShares are secured by the assets of the issuer. As at March 31, 2026, the fair value of the Shares and warrants was estimated to be $1,543,331.\n\n \n\n(ii) On February 11, 2026, the Corporation invested\n$1,000,000 in Alpha Square Fund, LP, a Delaware limited partnership managed by Alpha Square Management, LLC, through the purchase of limited\npartnership interests in the fund.\n\n \n\n**8.****Warrant\nliabilities**\n\n \n\nThe Corporation has warrants classified as financial liabilities as\nthey are not considered to be indexed to the common shares of the Corporation, due to the exercise price of the warrants denominated in\na currency other than the Corporation’s functional currency. In addition, during the three months ended March 31, 2026, the Corporation\nissued a warrant in respect of 269,231 SV Shares that do not meet the criteria for equity classification because they include provisions\nthat could require the Corporation to redeem the warrants for cash upon expiration if specified market conditions are not met, resulting\nin a potential obligation to transfer cash that is outside the Corporation’s control. Therefore the Corporation records these warrants\nas financial liabilities measured at fair value upon initial recognition. At each subsequent reporting date, the warrants are re-measured\nat fair value and the change in fair value is recognized through profit or loss. Upon warrant exercise, the fair value previously recognized\nin warrant liabilities is transferred from warrant liabilities to additional paid-in capital.\n\n \n\n12\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\nThe following table summarizes the changes in the warrant liabilities\nfor the Corporation’s warrants for the periods ended March 31, 2026 and December 31, 2025:\n\n \n\n  \nNumber of\nwarrants  \nAmount \n\nBalance, December 31, 2024 \n 3,636,363  \n$3,040,494 \n\nWarrants issued \n 1,492,190  \n 3,215,255 \n\nWarrants exercised \n (3,653,410) \n (7,324,588)\n\nRevaluation of warrant liabilities \n \n-\n  \n 3,110,015 \n\nForeign currency translation \n \n-\n  \n 256,754 \n\nBalance, March 31, 2025 \n \n \n  \n \n \n \n\nBalance, December 31, 2025 \n 1,475,143  \n 2,297,930 \n\nWarrants issued \n 269,231  \n 599,039 \n\nRevaluation of warrant liabilities \n \n-\n  \n (784,833)\n\nForeign currency translation \n \n-\n  \n (35,376)\n\nBalance, March 31, 2026 \n 1,744,374  \n$2,076,760 \n\n \n\nThe fair value of the Corporation’s warrants issued during the\nthree months ended March 31, 2026 were determined using the Monte Carlo simulation model with the following assumptions: expected life\nof 5 years; risk-free rate of 3.65%; expected volatility of 120.57%; and dividend yield of 0%. As at March 31, 2026, the warrants were\nremeasured with the following assumptions: expected life of 4.9 years; risk free rate of 3.92%; expected volatility of 113.16%; and dividend\nyield of 0%. The Corporation determined the fair value of the warrant liability based on based on Geometric Brownian Motion, which reflected\nour estimates regarding the probability and timing of events that could result in payments to the warrant holder or the exercise of the\nwarrants.\n\n \n\nThe\nfair value of the Corporation’s warrants determined using the Black-Scholes pricing model was determined with the following weighted\naverage assumptions:\n\n \n\n  \nAs at\nMarch 31,\n2026  \nAs at\nDecember 31,\n2025 \n\nSpot price (in CAD$) \n$2.63  \n$3.50 \n\nRisk-free interest rate \n 2.86% \n 2.64%\n\nExpected annual volatility \n 122% \n 121%\n\nExpected life (years) \n 2.26  \n 2.48 \n\nDividend \n nil  \n nil \n\n \n\nThe\nfollowing table reflects the Corporation’s warrants classified as liabilities outstanding and exercisable as at March 31, 2026.\n\n \n\n**Expiry\ndate**\n \n**SV Shares underlying**\nWarrants\noutstanding\nand\nexercisable   Exercise price \n\nAugust 15, 2027   522,727   US$2.00 \n\nFebruary 7, 2028   712,031   US$3.66 \n\nJuly 21, 2030   240,385   US$3.59 \n\nFebruary 20, 2031   269,231   US$2.85 \n\n    1,744,374      \n\n \n\n13\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\n**9.****Share\ncapital**\n\n \n\na)Authorized\nshare capital\n\n \n\nUnlimited\nsubordinate voting shares without par value and conferring 1 vote per share.\n\n \n\nUnlimited\nproportionate voting shares without par value, conferring 200 votes per share, convertible at the holder’s option into subordinate\nvoting shares on a basis of 200 subordinate voting shares for 1 proportionate voting shares.\n\n \n\nb)Subordinate\nvoting shares and proportionate voting shares issued\n\n \n\n(i)\nOn February 7, 2025, the Corporation completed a private placement consisting of 2,503,601 units of the Corporation at a purchase price\nof $2.64 per unit for gross proceeds of $6,609,500. Each unit is comprised of one subordinate voting share of the Corporation and one\nhalf warrant, with each warrant entitling the holder to purchase one additional share. The warrants have an exercise price of $3.66 per\nshare and exercise period of three years from the issuance date.\n\n** **\n\n**10.****Warrants\nClassified as Equity**\n\n \n\n  \nNumber of\n\nWarrants  \nWeighted Average\n\nExercise Price\n\n(CAD$) \n\nBalance, December 31, 2024 and March 31, 2025 \n 5,696,427  \n 6.67 \n\nBalance, December 31, 2025 and March 31, 2026 \n \n-\n  \n \n-\n \n\n \n\nAs\nof March 31, 2026, no equity-classified warrants are outstanding.\n\n** **\n\n**11.****Stock\noptions and restricted share units**\n\n \n\nThe\nfollowing table presents share-based compensation expense by instrument type:\n\n \n\n**Three\nMonths Ended March 31,**\n \n2026  \n2025 \n\nStock options \n$654,108  \n$417,843 \n\nRestricted share units \n 698,867  \n 410,920 \n\n  \n$1,352,975  \n$828,763 \n\n \n\n(a)Stock\noptions\n\n \n\nThe\nCorporation has a stock option plan whereby the maximum number of shares subject to the plan, in the aggregate, shall not exceed 10%\nof the Corporation’s issued and outstanding shares. The exercise price shall be no less than the discount market price as determined\nin accordance with relevant exchange policies. These option awards generally vest immediately or up to 1 year of continuous service.\n\n \n\n14\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\nThe\nfollowing table reflects the continuity of stock options for the periods presented below:\n\n \n\n  \nNumber of\nStock Options  \nWeighted Average\nExercise Price\n(CAD$) \n\nBalance, December 31, 2024 \n 482,954  \n 4.60 \n\nGranted \n 362,500  \n 1.85 \n\nExpired / cancelled \n (158,333) \n 2.88 \n\nBalance, March 31, 2025 \n 687,121  \n 3.55 \n\nBalance, December 31, 2025 \n 2,943,793  \n 3.74 \n\nGranted \n 250,000  \n 5.32 \n\nExpired / cancelled \n (143,663) \n 6.18 \n\nBalance, March 31, 2026 \n 3,050,130  \n 3.75 \n\n \n\nThe\nfair value of options granted for the three months ended March 31, 2026 and 2025 was $562,396 and $415,588, respectively.\n\n \n\nThe\nfair value of the Corporation’s options has been determined using the Black-Scholes pricing model and the following weighted average\nassumptions:\n\n \n\n  \n**Granted**\n\n**in 2026**\n \n\nSpot price (in CAD$)  $3.48 \n\nRisk-free interest rate   2.98%\n\nExpected annual volatility   143%\n\nExpected life (years)   5.00 \n\nDividend   nil \n\nFair value of option  $3.06 \n\n \n\nThe\naggregate intrinsic value of stock options outstanding and exercisable as at March 31, 2026 is $699,064. As of March 31, 2026, there\nwas $29,384 of total unrecognized compensation cost related to nonvested options granted to be recognized over the next 0.4 years.\n\n \n\nThe\nfollowing table reflects the stock options issued and outstanding as of March 31, 2026:\n\n \n\n**Expiry\nDate**\n  Exercise Price\n(CAD$)   Weighted Average\nRemaining\nContractual\nLife (years)   Number of\nOptions\nOutstanding   Number of\nOptions\nVested\n(exercisable)   Number of\nOptions\nUnvested \n\nMay 17, 2026   7.35    0.13    35,131    35,131    \n-\n \n\nJune 22, 2026   4.20    0.23    19,999    19,999    \n-\n \n\nMarch 5, 2030  US$1.25    3.93    200,000    200,000    \n-\n \n\nJune 6, 2030   2.09    4.19    1,040,000    1,040,000    \n-\n \n\nAugust 18, 2030   3.23    4.39    25,000    12,500    12,500 \n\nAugust 27, 2030  US$2.25    4.41    50,000    25,000    25,000 \n\nNovember 19, 2030   4.90    4.64    1,430,000    1,430,000    \n-\n \n\nJanuary 30, 2031  US$2.60    4.84    100,000    100,000    \n-\n \n\nJanuary 30, 2031  US$6.00    4.84    100,000    100,000    \n-\n \n\nMarch 23, 2031  US$2.39    4.98    50,000    50,000    \n-\n \n\n    3.75    4.37    3,050,130    3,012,630    37,500 \n\n \n\n15\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\n(b)Restricted\nshare units\n\n \n\nThe\nCorporation has an RSU plan whereby there is a fixed cap of shares that can be granted under the plan. The exercise price shall be no\nless than the discount market price as determined in accordance with relevant exchange policies.\n\n \n\nThe\nfollowing table reflects the continuity of RSUs for the periods presented below:\n\n \n\n  \nNumber of\nRSUs \n\nBalance, December 31, 2024 \n 2,828,336 \n\nGranted (i) \n 45,000 \n\nConverted \n (792,669)\n\nCancelled \n (6,500)\n\nBalance, March 31, 2025 \n 2,074,167 \n\nBalance, December 31, 2025 \n 2,283,943 \n\nGranted (ii) \n 1,050,000 \n\nConverted \n (379,664)\n\nBalance, March 31, 2026 \n 2,954,279 \n\n \n\n(i)During\nthe three months ended March 31, 2025, the Corporation granted 45,000 RSUs to consultants. These RSUs vest one-third on each of the first,\nsecond and third anniversaries of the date of grant. The grant date fair value of the RSUs was $67,297, which was measured based on the\nquoted price of the Corporation’s shares on the date of grant.\n\n \n\n(ii)During\nthe three months ended March 31, 2026, the Corporation granted an aggregate of 1,050,000 RSUs to one officer of the Corporation and one\nconsultant of the Corporation. These RSUs vest one-third on each of the first, second and third anniversaries of the date of grant. The\ngrant date fair value of the RSUs was $2,897,380, which was measured based on the quoted price of the Corporation’s shares on the\ndate of grant.\n\n \n\nThe aggregate intrinsic value of RSUs outstanding as at March 31, 2026\nis $5,997,186. As of March 31, 2026, there was $6,874,380 of total unrecognized compensation cost related to nonvested RSUs granted to\nbe recognized over the next 2.25 years. The fair value of RSUs is generally measured as the grant date price of the Corporation’s\nshare.\n\n \n\nFor\nthe three months ended March 31, 2026, the Corporation recorded share-based compensation of $698,867 related to vesting of RSUs (three\nmonths ended March 31, 2025 - $410,920).\n\n** **\n\n**12.****General\nand administrative expenses**\n\n \n\nGeneral\nand administrative expenses are comprised of:\n\n \n\n**Three\nMonths Ended March 31,**\n \n2026  \n2025 \n\nOffice and administrative expenses \n$1,843,171  \n$1,275,169 \n\nProfessional fees \n 1,009,986  \n 505,429 \n\nRegulatory fees \n 127,830  \n 104,941 \n\nShare based compensation \n 1,352,975  \n 828,763 \n\n  \n$4,333,962  \n$2,714,302 \n\n \n\n16\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\n**13.****Loss\nper share**\n\n \n\nBasic\nearnings (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding\nfor the period. Diluted earnings per share is computed by dividing net income (loss) by the weighted average number of shares of common\nstock during the period, plus common stock equivalents, outstanding during the period. If the Corporation reports a net loss, the computation\nof diluted loss per share excludes the effect of dilutive common stock equivalents, as their effect would be anti-dilutive.\n\n \n\nThe\nfollowing table sets forth the computation of basic and diluted loss per share attributable to common stockholders:\n\n \n\nThree Months Ended March 31, \n2026  \n2025 \n\nNumerator \n   \n  \n\nNet loss for the period \n$(4,652,345) \n$(1,633,261)\n\nLess: Net loss attributable to non-controlling interest \n \n-\n  \n \n-\n \n\nNet loss attributable to common shareholders - basic and diluted \n$(4,652,345) \n$(1,633,261)\n\nDenominator \n    \n   \n\nWeighted average shares used in computing net loss per share attributable to common shareholders - basic and diluted \n 69,636,328  \n 34,966,831 \n\nNet loss per share attributable to common shareholders - basic and diluted \n$(0.07) \n (0.05)\n\n \n\nIn\nperiods with a reported net loss, the effect of stock options, warrants, unvested restricted stock units, are excluded and diluted loss\nper share is equal to basic loss per share. The following is a summary of the common stock equivalents for the securities outstanding\nduring the respective periods that have been excluded from the computation of diluted net loss per common share:\n\n \n\nThree Months Ended March 31, \n2026  \n2025 \n\nLiability-classified warrants outstanding \n 1,744,374  \n 4,888,168 \n\nEquity-classified warrants outstanding \n \n-\n  \n 5,696,427 \n\nStock options outstanding \n 3,050,130  \n 687,121 \n\nUnvested restricted share units \n 2,954,279  \n 2,074,167 \n\n  \n 7,748,783  \n 13,345,883 \n\n \n\n**14.****Non-controlling\ninterest**\n\n \n\nThe Corporation incorporated US Data Centers Inc., as a subsidiary\non September 20, 2024. Subsequent to December 31, 2024, the Corporation dissolved this subsidiary and incorporated an entity of the same\nname. During the year ended December 31, 2025, $1,000,000 were distributed back to the original shareholders upon on dissolution. During\nthe three months ended March 31, 2026, the Corporation divested 49% of its ownership upon contribution of $1,905,000 from third-party\ninvestors. As of March 31, 2026, the Corporation retains a 51% equity interest in US Data Centers, Inc.\n\n** **\n\n17\n\n \n\n** **\n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n** **\n\n**15.****Related\nparty transactions**\n\n \n\nParties\nare considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant\ninfluence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject\nto common control. Related parties include key management personnel and may be individuals or corporate entities. A transaction is considered\nto be a related party transaction when there is a transfer of resources or obligations between related parties. Related party transactions\nare recorded at the exchange amount, being the amount agreed to between the related parties.\n\n \n\nKey\nmanagement personnel are those persons having authority and responsibility for planning, directing and controlling the activities of\nthe Corporation, directly or indirectly. Key management personnel include the Corporation’s executive officers and members of the\nBoard.\n\n \n\nRemuneration\nof key management personnel of the Corporation was as follows:\n\n \n\n**Three\nMonths Ended March 31,**\n \n2026  \n2025 \n\nProfessional fees(1) \n$99,899  \n$34,713 \n\nSalaries (1) \n 993,130  \n 689,545 \n\nDirectors fees \n 250,000  \n \n-\n \n\nShare based compensation(2) \n 1,074,956  \n 186,267 \n\n  \n$2,417,985  \n$910,525 \n\n \n\n(1)Represents\nthe professional fees and salaries paid to officers and directors in cash and BTC. During the three months ended March 31, 2026 the Corporation\npaid 1 BTC (three months ended March 31, 2025 - 5 BTC) as compensation for the services provided in by officers and directors with a\nfair value of $115,630 (three months ended March 31, 2025 - $491,095).\n\n \n\n(2)Represents\nthe share-based compensation for officers and directors.\n\n** **\n\n**16.****Cash\nflow supplemental information**\n\n \n\n**Three\nMonths Ended March 31,**\n \n2026  \n2025 \n\nDigital currencies items \n   \n  \n\nDigital currencies mined and staked \n$(47,727) \n$(765,876)\n\nBitcoin received from colocation services \n (2,576,804) \n (4,304,411)\n\nServices paid in digital currencies \n 115,630  \n 491,095 \n\nGain on sale of digital currencies \n (2,418) \n (337,009)\n\nGain on revaluation of digital currencies \n 3,764,103  \n 446,975 \n\n  \n$1,252,784  \n$(4,469,226)\n\nWorking capital items \n    \n   \n\nAmounts receivable and prepaid expenses \n$(16,285) \n$(1,130,745)\n\nAccounts payable and accrued liabilities \n (2,035,631) \n (3,145,539)\n\n  \n$(2,051,916) \n$(4,276,284)\n\nOther supplemental information \n    \n   \n\nInterest paid \n$\n-\n  \n$\n-\n \n\nTaxes paid \n$\n-\n  \n$\n-\n \n\n \n\n18\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\n**17.****Segmented\nreporting**\n\n \n\nThe\nCorporation has four operating segments being cryptocurrency mining, sales of energy and electricity, colocation services, and Tier III\nAI data centers located in the United States.\n\n \n\nDuring\nthe year ended December 31, 2025, the Corporation added a new operating segment related to Tier III AI data center operations. The AI\ndata center segment is in the development phase and has not yet commenced commercial operations as of March 31, 2026. As a result, this\nsegment did not generate revenue during the three months ended March 31, 2026.\n\n \n\nThe\nCorporation’s CODM evaluates segment performance and allocates resources based on segment revenue, net loss, and total assets.\nAccordingly, the Tier III AI data center segment has been included as a reportable segment.\n\n \n\n**Three Months Ended**\n\n**March 31, 2026**\n \nCryptocurrency\nmining  \nSales of\nenergy and\nelectricity  \nColocation\nServices  \nTier III\nAI Project  \nTotal \n\nRevenue \n$47,727  \n$3,716,711  \n$3,026,908  \n$\n-\n  \n$6,791,346 \n\nCost of revenue \n (11,640) \n (5,393,005) \n (738,233) \n \n-\n  \n (6,142,878)\n\nDepreciation and amortization \n (1,323,240) \n (126,864) \n \n-\n  \n \n-\n  \n (1,450,104)\n\nNet loss \n (1,389,237) \n (1,803,158) \n (1,459,950) \n \n-\n  \n (4,652,345)\n\nEBITDA \n 65,997  \n (1,676,294) \n (1,459,950) \n \n-\n  \n (3,202,241)\n\n \n\n**Three Months Ended**\n\n**March 31, 2025**\n \nCryptocurrency\n\nmining  \nSales of\n\nenergy and\n\nelectricity  \nColocation\n\nServices  \nTier III\n\nAI Project  \nTotal \n\nRevenue \n$765,876  \n$3,427,916  \n$5,082,795  \n$\n-\n  \n$9,276,587 \n\nCost of revenue \n (722,105) \n (3,707,148) \n (4,193,057) \n \n-\n  \n (8,622,310)\n\nDepreciation and amortization \n (2,064,886) \n (107,905) \n \n-\n  \n \n-\n  \n (2,172,791)\n\nNet loss \n (2,135,862) \n (387,137) \n 889,738  \n \n-\n  \n (1,633,261)\n\nEBITDA \n (70,976) \n (279,232) \n 889,738  \n \n-\n  \n 539,530 \n\n \n\nAs at March 31, 2026 \nCryptocurrency\nmining  \nSales of\nenergy and\nelectricity  \nColocation\nServices  \nTier III\nAI Project  \nTotal \n\nTotal assets \n$93,221,049  \n$8,142,026  \n$\n         -\n  \n$25,571,511  \n$126,934,586 \n\n \n\nAs at December 31, 2025 \nCryptocurrency\n\nmining  \nSales of\n\nenergy and\n\nelectricity  \nColocation\n\nServices  \nTier III\n\nAI Project  \nTotal \n\nTotal assets \n$50,707,889  \n$10,387,735  \n$61,994,641  \n$11,023,314  \n$134,113,579 \n\n \n\n19\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\n**18.****Financial\ninstruments and risk management**\n\n** **\n\n**Risks**\n\n* *\n\n*Credit\nrisk*\n\n \n\nCredit\nrisk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial\nloss. The Corporation’s primary exposure to credit risk is its cash and amounts receivable. The cash is held in multiple accounts\nthat are FDIC insured up to $3 million each. Although the Corporation’s cash balances may at times exceed insured limits, management\nmonitors the financial condition of the institutions where cash is held and believes the Corporation’s exposure to credit risk\nis not significant. The Corporation believes no impairment is necessary in respect of amounts receivable, deposits and promissory note\nreceivable as balances are monitored on a regular basis with the result that exposure to bad debt is insignificant.\n\n* *\n\n*Liquidity\nrisk*\n\n \n\nLiquidity\nrisk is the risk that the Corporation will not be able to meet its financial obligations as they fall due. The Corporation manages liquidity\nrisk by maintaining cash balances to ensure that it is able to meet its short-term and long-term obligations as and when they fall due.\nThe Corporation manages cash projections and regularly updates projections for changes in business and fluctuations caused in digital\ncurrency prices and exchange rates.\n\n \n\nThe\nfollowing table summarizes the expected maturity of the Corporation’s significant financial liabilities and other liabilities based\non the remaining period from the balance sheet date to the contractual maturity date:\n\n \n\n \n**Payments by period** \n\n**As\nat March 31, 2026** \nLess than\n\n1 year  \n1- 3 years  \n4 - 5 years  \nMore than\n\n5 years  \nTotal  \nCarrying\n\nValue \n\nAccounts payable and accrued liabilities \n$3,716,253  \n$\n-\n  \n$\n-\n  \n$\n-\n  \n$3,716,253  \n$3,716,253 \n\nDeposit payable \n \n-\n  \n 2,203,526  \n \n-\n  \n \n-\n  \n 2,203,526  \n 2,203,526 \n\n  \n$3,716,253  \n$2,203,526  \n$\n-\n  \n$\n-\n  \n$5,919,779  \n$5,919,779 \n\n \n\n \n**Payments by period** \n\n**As at December 31,\n2025** \nLess than\n\n1 year  \n1- 3 years  \n4 - 5 years  \nMore than\n\n5 years  \nTotal  \nCarrying\n\nValue \n\nAccounts payable and accrued liabilities \n$6,350,923  \n$\n-\n  \n$\n-\n  \n$\n-\n  \n$6,350,923  \n$6,350,923 \n\nDeposit payable \n \n-\n  \n 2,203,526  \n \n-\n  \n \n-\n  \n 2,203,526  \n 2,203,526 \n\n  \n$6,350,923  \n$2,203,526  \n$\n-\n  \n$\n-\n  \n$8,554,449  \n$8,554,449 \n\n \n\n20\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\n*Foreign\ncurrency risk*\n\n \n\nCurrency\nrisk relates to the risk that the fair values or future cash flows of the Corporation’s financial instruments will fluctuate because\nof changes in foreign exchange rates. Exchange rate fluctuations affect the costs that the Corporation incurs in its operations.\n\n \n\nAs\nthe Corporation operates in an international environment, some of the Corporation’s financial instruments and transactions are\ndenominated in currencies other than an entity’s functional currency. The fluctuation of the Canadian dollar in relation to the\nUS dollar will consequently impact the profitability of the Corporation and may also affect the value of the Corporation’s assets\nand liabilities and the amount of shareholders’ equity. As at March 31, 2026 and December 31, 2025, the foreign currency risk was\nconsidered minimal.\n\n* *\n\n*Digital\ncurrency risk*\n\n \n\nDigital\ncurrency prices are affected by various forces including global supply and demand, interest rates, exchange rates, inflation or deflation\nand the global political and economic conditions. The profitability of the Corporation is directly related to the current and future\nmarket price of digital currencies; in addition, the Corporation may not be able liquidate its holdings of digital currencies at its\ndesired price if required. A decline in the market prices for digital currencies could negatively impact the Corporation’s future\noperations. The Corporation has not hedged the conversion of any of its sales of digital currencies.\n\n \n\nDigital\ncurrencies have a limited history and the fair value historically has been very volatile. Historical performance of digital currencies\nis not indicative of their future price performance. The Corporation’s digital currencies currently consist of Bitcoin and Ethereum.\n\n \n\nAt\nMarch 31, 2026, had the market price of the Corporation’s holdings of Bitcoin increased or decreased by 10% with all other variables\nheld constant, the corresponding asset value increase or decrease respectively would amount to $1,143,021 (compared to $1,181,232 as\nof December 31, 2025).\n\n \n\nAt\nMarch 31, 2026, had the market price of the Corporation’s holdings of Ethereum increased or decreased by 10% with all other variables\nheld constant, the corresponding asset value increase or decrease respectively would amount to $213,119 (compared to $300,186 as of December\n31, 2025 -).\n\n** **\n\n**Financial\nInstrument**\n\n \n\nThe\nCorporation measures certain financial and non-financial assets and liabilities at fair value on a recurring or non-recurring basis.\nThe fair values of investments were measured using the cost, market or income approaches.\n\n \n\nThe fair value of the Corporation’s financial instruments, including\ncash, current portion of amounts receivable, investment, and accounts payable and accrued liabilities approximates their carrying value\ndue to their short-term nature. Deposit payable is due to arm’s length third parties, with the fair values of this payable measured\nusing relevant market input (Level 3). The fair value of deposit payable was calculated using actualized cash flows using market rates\nin effect at the balance sheet date. Reasonable changes to key assumptions would not have a significant impact. Investment is measured\nusing a market-based valuation approach, utilizing relevant Level 3 market inputs. Digital currencies are measured at fair value using\nthe quoted price on Gemini Exchange (Level 1). Warrant liabilities are measured at fair value using the Black-Scholes pricing model (Level\n2) or the Monte Carlo simulation technique (Level 3).\n\n \n\n21\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\nThe\nfollowing tables present information about the Corporation’s assets and liabilities measured at fair value on a recurring basis\nand the Corporation’s estimated level within the fair value hierarchy for each of those assets and liabilities as of March 31,\n2026 and December 31, 2025, respectively:\n\n \n\n  \nAs at March 31, 2026  \nAs at December 31, 2025 \n\n  \nLevel 1  \nLevel 2  \nLevel 3  \nLevel 1 * *\nLevel 2  \nLevel 3 \n\nAssets \n   \n   \n   \n  * *\n   \n  \n\nCash \n$57,813,811  \n$\n-\n  \n$\n-\n  \n$78,478,759 * *\n$\n-\n  \n$\n-\n \n\nDigital currencies \n$13,561,396  \n$\n-\n  \n$\n-\n  \n$14,814,180 * *\n$\n-\n  \n$\n-\n \n\nInvestments \n$\n-\n  \n$\n-\n  \n$2,543,331  \n$\n-\n * *\n$\n-\n  \n$1,543,331 \n\n  \n    \n    \n    \n   * *\n    \n   \n\nLiabilities \n    \n    \n    \n   * *\n    \n   \n\nWarrant liability \n$\n-\n  \n$1,546,156  \n$530,604  \n$\n-\n * *\n$2,297,930  \n$\n-\n \n\nObligation to issue warrants \n$\n-\n  \n$\n-\n  \n$\n-\n  \n$\n-\n * *\n$599,603  \n$\n-\n \n\n \n\nThere\nwere no transfers among Levels 1, 2 or 3 during the years ended March 31, 2026 and December 31, 2025.\n\n** **\n\n**19.****Commitment**\n\n \n\nDuring the year ended December 31, 2025, the Corporation entered into\na contract with a supplier for the purchase of various high-performance computers in connection with the Tier III AI project. Under the\nterms of the agreement, payments are due upon shipment of the equipment.\n\n \n\nThe Corporation has made a payment of $14,584,582 under this agreement.\nAs of March 31, 2026, no liability has been recorded related to this commitment, as the goods had not yet been received and the payment\nwas not yet due. The Corporation has a commitment to pay the remaining amount of $1,145,000.\n\n** **\n\n**20.****Subsequent\nevents**\n\n \n\n(i) On April 18, 2026, the Corporation entered into a bare metal GPU rental agreement with SubQ AI for a term of 24 months, effective\nMay 15, 2026, relating to the Tier III AI project. \n\n \n\n22\n\n \n\n \n\n**Digi Power X Inc.**\n\n**Notes to Condensed Interim Consolidated Financial Statements**\n\n**Three Months Ended March 31, 2026**\n\n**(Expressed in United States Dollars) (Unaudited)**\n\n \n\n(ii) On May 4, the Corporation entered into a Data Center Colocation\nand Master Services Agreement (the “Cerebras Agreement”) with Cerebras Systems Inc. (“Cerebras”) to deploy at\ntotal of approximately 40 megawatts (“MW”) for AI computing at the Corporation’s AI data center campus in Columbiana,\nAlabama (the “Facility”). Pursuant to the Cerebras Agreement, Cerebras will hold an exclusive license to access the data center\nfor the duration of the Cerebras Agreement. The Cerebras Agreement has an initial term of ten (10) years (the “Initial Term”)\nfrom the later of the two phase commencement dates (as described below). Additionally, the Cerebras Agreement grants Cerebras the right\nto extend the Initial Term for one or more additional periods of one (1), three (3), five (5), or seven (7) years (each, an “Extension”).\nPursuant to the Cerebras Agreement, the total contract value to the Corporation is approximately $1.1 billion in the initial term of the\ncontract, with a total potential contract value to the Corporation of approximately $2.5 billion, assuming one seven (7)-year Extension,\nin each case subject to the Corporation meeting its obligations under the agreement. The Cerebras Agreement provides for certain one-time\npayments by Cerebras in connection with Phase 1 and Phase 2 construction, as well as a monthly colocation fee to paid by Cerebras for\nPhase 1 and Phase 2 (a portion of which is to be prepaid), based upon the number of kilowatts delivered. The Cerebras Agreement requires\nthe Corporation to construct, equip, and commission two phases of the colocation space at the Facility, with Phase 1 (15 MW) ready-for-service\ndate targeted at December 15, 2026 and with full deployment in Phase 2 (40 MW) targeted by the end of the first fiscal quarter of 2027.\nThe additional 25 MW of load capacity in Phase 2 is conditioned on the Corporation securing adequate financing for Phase 2 operations.\nThe Cerebras Agreement also contains various other customary terms and conditions, including representations and warranties, service and\nservice credit, penalty, termination, indemnification, confidentiality, and limitation of liability provisions. For more information,\nsee the Corporation’s Current Report on Form 8-K, filed with the SEC on May 8, 2026.\n\n \n\n(iii)\nOn May 8, 2026, the Corporation filed with SEC a prospectus supplement to the base prospectus and the accompanying preliminary prospectus\nsupplement included in the Corporation’s registration statement on Form S-3 (File No. 333-294953), filed with the SEC on April\n9, 2026, covering the offer and sale from time to time of up to an aggregate of $175,000,000 of shares of the Corporation’s common\nstock, no par value per share (“Shares”), which includes the $75,000,000 of Shares covered by the prior prospectus supplement.\n\n \n\nPursuant to this at-the-market equity program,\nthe Corporation issued 19,950,000 subordinate voting shares for a total aggregate of $102,862,650 subsequent to March 31, 2026.\n\n \n\n(iv) Subsequent to March 31, 2026, the Corporation\nissued 654,408 subordinate voting shares from the exercise of warrants and options for gross proceeds of $2,002,438. In addition, the\nCorporation issued 8,967 subordinate voting shares from the exercise of RSUs. \n\n \n\n23"}