D. Boral ARC Merger Corp

Exascale Labs Holdings Inc. operates as a next-generation AI infrastructure provider in the rapidly evolving market for GPU-based compute services and AI infrastructure solutions. The industry is undergoing a secular transition from CPU-centric data centers to accelerated computing environments purpose-built for AI, driven by the rapid adoption of Generative AI and large language models. Global spending on AI infrastructure is projected to exceed $2.0 trillion by 2026 ¹, and the top five hyperscalers are expected to increase combined capital expenditures from approximately $256.0 billion in 2024 to approximately $602.0 billion in 2026 ². Global data centers will require a cumulative investment of approximately $6.7 trillion by 2030, of which approximately $5.2 trillion is attributed to AI-related infrastructure ³. Supply constraints for high-end AI processors could extend through 2027 and into 2028 ⁴, and the industry is transitioning toward high-density computing environments supporting rack densities from approximately 40 kilowatts to over 100 kilowatts per rack ⁵.

The company faces intense competition from a range of entities, including general-purpose cloud providers such as Amazon Web Services, Microsoft Azure, Google Cloud Platform, Oracle Cloud Infrastructure and IBM Cloud ⁶; specialized AI infrastructure providers such as CoreWeave, Nebius, Lambda, Crusoe, Voltage Park, WhiteFiber and Hyperstack ⁷; GPU aggregators and marketplaces such as Vast.ai, Aethir Cloud and Hyperbolic ⁸; and data center operators and AIDC service providers. The company believes its competitive strengths include its purpose-built platform for large-scale AI workloads, proprietary software-defined efficiency through an Intelligent Scheduling System, an asset-light and scalable delivery model, rapid deployment capabilities, a diversified customer base, and an accessible service model for SMEs and emerging AI startups. As of June 30, 2026, the company served close to 50 distinct customers, with its largest single customer contributing approximately 20.1% of total revenue ⁹.

The company generates revenue through two primary product and service categories: GPU-as-a-Service (GaaS) and AI Infrastructure Solutions. GaaS provides reserved and on-demand access to high-performance GPU compute capacity via bare-metal and VM configurations, supporting large-scale model training, fine-tuning, and high-concurrency inference. AI Infrastructure Solutions includes revenue-generating GPU cluster management and operational services for AI data center operators, as well as complementary infrastructure solution capabilities—modular data center, high-density liquid cooling, HVDC power, data center interconnectivity and energy storage—that have not yet generated revenue. The company operates on an asset-light basis, sourcing GPU capacity from third-party suppliers and data center partners, and integrates these resources through its proprietary software systems and service capabilities.

Revenue from intelligent computing power service, which encompasses GaaS and related compute services, was $14,664,937 for fiscal year 2026, representing 98.9% of total revenues, compared to $6,546,249 and 93.3% in fiscal year 2025 ¹⁰. Revenue from comprehensive data center service, which includes GPU cluster management and operational services, was $157,862 for fiscal year 2026, representing 1.1% of total revenues, compared to $469,263 and 6.7% in fiscal year 2025 ¹¹. The company's platform supports a range of AI workloads, and its API capabilities enable programmatic provisioning and lifecycle management of compute resources, including GPU and CPU nodes, Command Line Interfaces, and integration with networking and storage configurations.

The company has developed complementary infrastructure solution capabilities, including modular data center solutions, high-density liquid cooling systems, HVDC power architectures, data center interconnectivity and energy storage capabilities. Management believes these solutions are ready for commercial engagement, but they have not been deployed at scale under binding commercial contracts and have not generated revenue as of the date of the Annual Report. The company expects to pursue these offerings on an asset-light basis through partnerships, systems integration, contract manufacturing and other collaborative structures.

During fiscal year 2026, the company sold and issued an aggregate of two Simple Agreements for Future Equity (SAFEs) for an aggregate amount of $3.5 million ¹². Subsequent to period end, on July 2, 2026, the company sold and issued one SAFE for $1.0 million ¹³. The Business Combination closed on August 27, 2026, with holders of 26,865,211 BCAR Class A Ordinary Shares exercising their right to redeem their shares for cash ¹⁴. The company issued or reserved for issuance a total aggregate of 33,689,050 shares of Class A Common Stock and 30,645,739 shares of Class B Common Stock ¹⁵, with an aggregate merger consideration of $500,000,000 based on a deemed value of $10.00 per share ¹⁶. The company assumed 14,099,992 warrants, each exercisable for one share of Class A Common Stock at an exercise price of $11.50 per share ¹⁷.

Total revenues for fiscal year 2026 were $14,822,799, an increase of 111.3% from $7,015,512 in fiscal year 2025 ¹⁸. Gross profit was $2,418,253, representing a gross margin of 16.3%, compared to $1,105,197 and 15.8% in the prior year ¹⁹. The company incurred a net loss of $12,162,391 for fiscal year 2026, compared to a net loss of $7,659,667 in fiscal year 2025 ²⁰. Loss from operations was $4,800,840 in fiscal year 2026, compared to $3,044,846 in fiscal year 2025 ²¹.

The company expects to continue to incur operating losses for the foreseeable future as it invests in product development, platform enhancements, sales and marketing activities, personnel and infrastructure to support growth. The company's ability to achieve and sustain profitability will depend on numerous factors, many of which are beyond its control. Under its asset-light business model, the company incurs significant recurring operating expenses, including costs associated with sourcing GPU resources, developing and maintaining software and platform capabilities, data center hosting, power and network services. These costs may not increase proportionately with revenue, and the ability to improve operating margins depends on efficiently managing these expenses while increasing revenue and utilization of infrastructure.

The company's primary growth vector is the expansion of its GaaS offering, driven by the unprecedented demand for specialized, high-performance accelerated computing infrastructure. The company believes the market is in the early stages of a secular transition from CPU-centric data centers to accelerated computing environments purpose-built for AI, and that the convergence of supply constraints, increasing technical complexity, and the need for rapid deployment has created a significant and durable market opportunity for asset-light, execution-focused AI infrastructure providers. The company plans to scale capacity in response to customer demand without the long lead times and significant balance-sheet burdens associated with building greenfield data centers or owning depreciating hardware assets, and to adapt to new hardware generations to reduce the risk of technology obsolescence.

The company's second growth vector is the commercialization of its complementary infrastructure solution capabilities, including modular data center, high-density liquid cooling, HVDC power, data center interconnectivity and energy storage solutions. Management believes these offerings are ready for commercial engagement, although they have not yet generated revenue. The company expects to pursue these offerings on an asset-light basis, primarily through partnerships, systems integration, contract manufacturing and other collaborative structures. The company believes this approach may allow it to participate in broader AI infrastructure deployments over time while maintaining an asset-light operating model.

The company's margin and cost outlook is influenced by its ability to manage operating expenses in relation to revenue. The primary cost components include GPU hardware resources, data center hosting, power, and network services. The company seeks to improve financial performance by managing resource utilization, negotiating procurement arrangements, and applying pricing practices intended to reflect cost structures and market conditions. The company's customer renewal rate was approximately 90% for fiscal year 2025 and 68% for fiscal year 2026 ²².

The company's operational outlook is focused on securing a stable and competitive supply of advanced GPU chips, managing computing power supply under an asset-light model, developing and scaling its technical and operational platform, and managing third-party data center dependencies. The company relies on multiple GPU capacity supplier relationships to support supply continuity and procurement flexibility, and does not have take-or-pay obligations, minimum purchase commitments or exclusivity obligations in its supplier arrangements. The company's average contracted GPU supply was 1,294.7 GPUs in fiscal year 2026, compared to 935.3 GPUs in fiscal year 2025 ²³, and average deployed GPU capacity was 1,154.7 GPUs in fiscal year 2026, compared to 816.7 GPUs in fiscal year 2025 ²⁴.

The company's capital allocation strategy is focused on investing in product development, platform enhancements, sales and marketing activities, personnel and infrastructure to support growth. The company does not anticipate declaring or paying any cash dividends on its Common Stock for the foreseeable future. The company expects that significant additional capital may be needed in the future to continue its planned operations, and may sell Class A Common Stock, convertible securities or other equity securities in one or more transactions to raise capital.

The company faces several structural headwinds and constraints, including the limited and constrained supply of advanced GPU chips, which are subject to global supply constraints, limited sources of manufacture, and significant demand volatility. The company also faces risks related to its dependence on third-party GPU capacity suppliers and third-party data center facilities, which could experience disruptions, non-renewals, pricing increases or capacity limitations. Additionally, the company's infrastructure solution capabilities have not yet generated revenue and may not achieve commercial success, and rapid technological change in GPUs, networking, and AI software could require the company to adapt quickly.

The company is subject to a wide range of laws and regulations, including U.S. export controls and sanctions laws, which could limit its ability to procure GPU hardware or serve certain customers. The U.S. Department of Commerce continues to tighten export controls and add firms to the Entity List, which could require the company to obtain licenses to export infrastructure services to such listed firms. The company is also monitoring the January 29, 2024 proposed rule from the Bureau of Industry and Security, which if implemented as proposed, would impose requirements on Infrastructure-as-a-Service providers to verify the identity and beneficial ownership of foreign person customers.

The company has a limited operating history and has incurred net losses since inception, with net losses of $12.2 million and $7.7 million for fiscal years 2026 and 2025, respectively ²⁵. The company depends on a limited and constrained supply of advanced GPU chips, which are subject to global supply constraints and significant demand volatility, and any disruption or increase in cost could adversely affect its business ²⁶. The company's asset-light model depends on third-party GPU capacity suppliers, and supplier costs are a principal component of cost of revenue; pricing is generally subject to market conditions, and the company does not have take-or-pay obligations or minimum purchase commitments ²⁷. The company's infrastructure solution capabilities, including modular data centers, liquid cooling, HVDC power, data center interconnectivity and energy storage, have not yet generated revenue and may not achieve commercial success ²⁸. The company has identified material weaknesses in its internal control over financial reporting, related to a lack of sufficient accounting personnel with U.S. GAAP and SEC reporting experience and a lack of financial reporting policies and procedures commensurate with U.S. GAAP and SEC requirements ²⁹.

Management's message emphasizes the company's position as a next-generation AI infrastructure provider operating an asset-light, software-defined GPU compute platform, purpose-built for large-scale AI workloads including LLM training, fine-tuning, and high-concurrency inference. The strategic priorities for the period ahead include expanding the GaaS offering, commercializing the complementary infrastructure solution capabilities, and maintaining an asset-light operating model to mitigate balance-sheet leverage and asset lifecycle risk. Management highlights the company's proprietary Intelligent Scheduling System as a key differentiator, designed to decouple workload performance from raw hardware availability and achieve utilization rates that significantly exceed standard industry benchmarks. The company expects to continue to incur operating losses for the foreseeable future as it invests in product development, platform enhancements, sales and marketing activities, personnel and infrastructure to support growth.