BRUN — Q2 2026 Financial Report Analysis

Overview

Boost Run rents out NVIDIA GPU servers — the specialised chips used to train and run AI models — to companies that need the computing power but don't want to buy and house the hardware themselves. Customers rent specific servers sitting in data centres Boost Run leases (Texas, Illinois, North Carolina, Minnesota, Washington, Georgia), either directly through Boost Run's own platform, through other AI platforms, or through brokers who resell the capacity. A small and shrinking side line earns crypto-style "blockchain rewards" by lending spare GPU time to networks such as Bittensor and Aethir. The company went public on May 8, 2026 by merging with a SPAC (a listed shell company, Willow Lane Acquisition Corp.), so this is its first quarter reported as a public company.

Revenue nearly quadrupled to $31.1 million in Q2 2026 (from $8.4 million a year earlier), driven by "the execution of certain significant long-term customer contracts." But the company swung from a $2.5 million profit to a $75.0 million net loss. Most of that loss — $55.7 million — is a one-time, non-cash tax charge from turning a tax-exempt partnership into a regular corporation. The rest is real: the cost of the servers wearing out (depreciation) and the data-centre rent together ate up 92% of revenue, before any salaries or overhead.

At a glance

• $31.1M revenue, up 270% year on year and up 184% from Q1's $11.0M. Almost all of it ($30.4M) is GPU rental; blockchain rewards fell to $0.7M from $1.3M.
• $55.7M one-off tax charge turned a $19.3M pre-tax loss into a $75.0M net loss. Strip out that charge plus $7.1M of stock awards and a $1.4M debt-payoff charge and the quarter still lost about $10.9M before tax.
• $114.2M of operating cash flow in the first half came almost entirely from customer prepayments ($112.9M of new customer deposits). Excluding those, operating cash flow was about $1.3M — while the company paid $99.9M to finance its GPU leases.

Q2 2026 results

*Boost Run defines gross profit as revenue minus "cost of revenue," which excludes both depreciation and data-centre rent — the two biggest costs of a GPU rental business. See below. n/m = not meaningful (profit turned to loss).

For the six months, revenue was $42.1M (up 235% from $12.6M) and the net loss was $79.2M versus a $2.6M profit in the first half of 2025.

Takeaway: Boost Run's revenue is growing very fast, but on an all-in basis it barely covers the cost of the machines and the buildings they sit in — Q2 revenue of $31.1M minus cost of revenue, data-centre rent and depreciation leaves about $0.7M. The investment case rests almost entirely on roughly $1.9 billion of contracts (company figure) that mostly start between late 2026 and mid-2027, and on the company financing a $1.44 billion hardware purchase commitment to fulfil them.

What drove the quarter

Revenue. Management attributes the 270% jump to "higher GPU utilization rates, expansion of customer contracts in the enterprise AI vertical, and incremental pricing adjustments." Rental revenue rose by $23.3M; blockchain rewards fell by $0.6M as more capacity went to paying rental customers.

Costs grew faster than revenue. Total operating costs rose 715% to $44.0M, against revenue growth of 270%:

• Depreciation and amortization (+$15.6M) — the accounting charge for wearing out the servers. $11.3M of the increase came from GPU servers held under finance leases (essentially buying the hardware on instalments), $2.8M from a large software licence signed in April, and $1.6M from owned equipment.
• Colocation lease cost (+$9.0M) — rent and power for data-centre space, mostly from three sites not open a year ago (Charlotte, Minneapolis, Seattle) plus higher power and bandwidth at existing ones.
• SG&A (+$12.8M to $13.6M) — overhead. The biggest piece was a $6.9M rise in stock-based compensation, almost all a $7.0M share award to a consultant (B. Luke Weil, a related party) that vested when the stock hit its price targets. Also: $1.7M of state franchise taxes owed for the first time, $1.6M of payroll for 15 new hires, and $1.5M more in professional fees.

Below operating profit. Interest expense rose to $5.1M from $0.5M, covering the GPU finance leases, bridge loans repaid at the merger, and $1.9M of imputed interest on a $100M software-licence deal payable over five years. Repaying the bridge loans also triggered a $1.4M loss on extinguishment of debt.

What the headline numbers hide

• The 94.5% "gross margin" is not a margin in the usual sense. It leaves out depreciation ($18.1M) and colocation rent ($10.6M). For a company whose product is renting out servers housed in rented buildings, those are the cost of goods. Counting them, Q2 revenue covered direct costs by only about $0.7M — roughly a 2% margin — before any overhead.
• The $75.0M loss is mostly a one-off, but the business is still loss-making underneath. The $55.7M tax charge is a one-time, non-cash item: as a partnership, Boost Run Holdings paid no company-level tax; becoming a corporation required it to book a deferred tax liability for past timing differences in one go. Adding back that charge, the $7.1M of stock awards and the $1.4M debt-payoff loss still leaves a pre-tax loss of about $10.9M. A year ago the business made a 35.8% operating margin; this quarter it is −41.4%.
• Cash flow is flattered by customer prepayments. First-half operating cash flow of $114.2M looks large next to a $79.2M net loss, but $112.9M of it is customers paying in advance for contracts that mostly have not started (customer deposits on the balance sheet rose to $128.4M, of which $93.5M is long-term). That cash is owed back as service, not earned yet. Meanwhile, $99.9M went out in finance-lease payments — booked under financing, not operations — plus $39.7M of equipment purchases and lease prepayments.
• Receivables jumped faster than sales. Money owed by customers rose to $15.3M from $2.6M at the end of 2025 (up about 490%), while quarterly revenue rose 184% from Q1. Some of this may reflect blockchain-reward receivables and timing of large contracts, but the filing does not break it down.
• Leverage has gone up sharply. Total liabilities are $642.2M against $100.1M of shareholders' equity: $238.1M of finance leases, $119.5M of operating leases, $78.5M of other financial obligations (mostly the $100M software deal) and $128.4M of customer deposits. The company reports a $23.6M working-capital deficit, which it attributes mainly to those prepayments.
• Controls and filing timeliness. Management concluded disclosure controls were "not effective" due to material weaknesses (IT controls, segregation of duties, and too few qualified accounting staff). Both the Q1 and Q2 10-Qs were filed late after NT 10-Q notices, and the Q1 report was amended on August 18 to restate its controls section.

The commitments that matter more than this quarter

• Hardware purchase commitment: about $1.44 billion over five years, with $578M due in the first year, under a strategic purchasing agreement signed April 17, 2026 (the earnings release identifies the counterparty as Dell). If Boost Run doesn't buy enough, it owes the shortfall. Management says year-one orders already "substantially exceeded" the minimum. For scale, unrestricted cash was $120.2M at June 30, plus about $34.2M raised from warrant exercises in July and August.
• Contracts signed but not yet producing revenue: a 240-server, three-year rental worth about $207.6M starting November 30, 2026 ($19.0M already prepaid); a 1,536-GPU (NVIDIA B300) contract worth about $222.5M over 48 months starting March 2027; and, after quarter-end, a roughly five-year agreement with AI company Cohere worth about $525.6M, with acceptance expected to begin in Q2 2027 (8-K filed October 6, 2026). The Cohere deal lets the customer cancel and get prepayments back if a minimum amount of infrastructure isn't accepted by July 15, 2027 — so delivery timing is a real risk, not a formality.
• New data-centre leases were signed in July (Rock Island, Illinois, 60 months) and August (Pryor, Oklahoma, 144 months), adding fixed rent before the contracts that would fill them begin.

Outlook

Management's targets, from the August 14 earnings release: exit 2026 with about $400M of annualized recurring revenue (ARR) — the yearly revenue run-rate from contracted customers — and reach a "sustainable Net Cash Flow Margin of 15% to 20%" in future periods. The company also says total contracted value stands at $1.9 billion, with over $1 billion signed in Q2, and that it is pursuing a further $4–5 billion hardware procurement across multiple manufacturers. These are company figures; the 10-Q itself does not report ARR or total contract value.

Our read: Q2 revenue annualizes to about $125M, so the $400M year-end ARR target needs roughly a tripling in six months. That is plausible only if the November 2026 contract starts on time and other deployments come online as planned. The bigger question is funding: the contracts depend on buying hundreds of millions of dollars of hardware first, against $120M of cash, so expect more borrowing, leases or share issuance. Shareholders also face further dilution from stock awards — on September 29 the board granted RSUs to the CFO, COO and CTO with a grant-date value of about $76.4M, which will run through future SG&A.

What to watch in Q3 (10-Q due mid-November): whether revenue keeps growing sequentially before the large contracts start; whether depreciation and rent keep outpacing revenue; how much of the $578M year-one hardware commitment has been paid for, and how; and whether operating cash flow stays positive once you take out new customer prepayments.

This is the first Boost Run report on this site, so there is no earlier outlook to check against.