Forum Markets Q3 2026 Earnings Results & Report

Forum Markets EPS Results

• Actual EPS: $0.47
• Consensus EPS: -$0.12
• Beat/Miss: Beat by +$0.59
• One Year Ago EPS: N/A

Forum Markets Revenue Results

• Actual Revenue: $2.00 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Forum Markets (NASDAQ:FRMM) Inc is a digital asset platform modernizing capital markets through the tokenization of institutional-grade real-world assets on Ethereum. The company structures cash-generating assets on blockchain-based infrastructure to facilitate liquidity, investor access, and primary and secondary market activity. It combines traditional asset management practices with digital market infrastructure to support the origination, distribution, and trading of real-world assets.

Forum Markets Q3 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Forum said it established Forum Edge AI to deploy GPU compute at existing powered data centers and tower sites, beginning with its North Carolina and Dallas facilities. Management sees these ready-to-use sites as an advantage as new construction faces rising costs and potential permitting delays.
• Negative Sentiment: Forum cut its 2026 revenue outlook to $8 million–$9 million from $18 million–$22 million and no longer expects AI compute revenue this year, citing a slower deployment timeline. It maintained its 2027 revenue guidance of $125 million–$175 million, subject to finalizing customer contracts and financing.
• Negative Sentiment: Management described sharp increases in GPU prices, equipment costs, and financing costs, and said it will delay commitments until contract pricing and costs support expected returns. It is discussing revised deal structures, including customer deposits that could cover 70%–100% of equipment costs.
• Neutral Sentiment: Third-quarter revenue was about $2 million, all from aircraft engine leases; reported net income of $7.9 million and adjusted EBITDA of $12.8 million included a $13.9 million non-cash gain on digital assets. Revenue declined from $4.1 million a year earlier as the company exited its prior digital-asset operating model.

Presentation

[Operator]

Hello, and welcome to Forum Markets' third quarter 2026 earnings conference call. During today's discussion, all callers will be placed in a listen-only mode. Following management's prepared remarks, the call will be open for questions. This call is being recorded on November 12, 2026, and a replay will be made available on Forum's investor relations website later today. I will now turn the call over to John Kristoff, Senior Vice President, Corporate Communications and Investor Relations.

[John Kristoff, SVP of Corporate Communications and Investor Relations at Forum Markets]

Thank you, Justin. Hello, and thank you all for joining Forum's third quarter 2026 financial results conference call. Joining me on the call today are McAndrew Rudisill, Chairman and Chief Executive Officer, and John Saunders, Chief Financial Officer. We hope you've had an opportunity to review our third quarter financial results issued earlier this morning. We've also posted an earnings presentation to our investor relations website. As a reminder, some of the matters we'll be discussing on this morning's call are forward-looking in nature. Please keep in mind that actual results could differ materially from what is expressed in these forward-looking statements. Forum assumes no obligation to update the information, and we encourage you to refer to our most recently filed documents with the SEC for a discussion of factors that could cause actual results to differ materially from our statements.

[John Kristoff, SVP of Corporate Communications and Investor Relations at Forum Markets]

During our call, we may also reference certain non-GAAP financial measures. We believe these provide useful information for investors. A reconciliation of these non-GAAP measures to the corresponding GAAP measures can be found in our press release and presentation, both available on our investor relations website. With that, I'll now turn the call over to McAndrew.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Thank you, John, and good morning, everyone. Thank you for joining us. Over the past three months, we have taken the most significant steps to date in executing Forum's operating strategy. We have established our AI infrastructure platform and made it the primary focus of our capital and our growth. We have continued to execute our longstanding plan to acquire and operate cash-generating assets with attractive risk-adjusted returns in large markets with durable demand, backed by tangible collateral and strong counterparties. In August, I said we were close to deploying capital into AI compute. Since then, we have put the platform and the sites in place and initiated offtake partnerships to capitalize on our investments in what is proving to be an increasingly scarce capacity.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

On our last call, I said we expected to provide shareholders with a meaningful update on the work of the board's special committee before this call. In early October, we delivered that update with the formation of Forum Edge AI to deploy high-performance GPU compute capacity across existing powered data centers and communications tower sites. The committee's mandate has been to identify the path that best maximizes long-term value for Forum shareholders, and we believe Forum Edge AI does exactly that. Our thesis is straightforward. As AI adoption accelerates, we expect a growing share of compute demand to come from inference, which is where trained AI models are put to work in real-world applications. Unlike training, which typically requires large centralized facilities, many inference workloads are better served by smaller distributed capacity located closer to the people and businesses using AI.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Much of the infrastructure needed to support that capacity already exists today. By deploying compute at existing powered sites rather than building new data centers from the ground up, we believe we can bring capacity online faster with less upfront capital and limited exposure to permitting and regulatory delays. Our modular approach also allows us to add capacity incrementally as demand is secured, which keeps our capital allocation disciplined. We see significant demand for our near and medium-term capacity, such that we expect potentially more favorable terms from offtake partners than those originally anticipated and modeled. We are in active discussions with multiple potential partners who want to secure it. The question is not whether we can contract our capacity. Our priority is to ensure we are contracting it on terms that make the most sense for Forum and its shareholders.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Turning to deployment, our near-term priorities are finalizing enhancements to our High Point, North Carolina, data center and preparing additional GPU capacity in Dallas. Both sites are permitted, powered, and built, which gives us the foundation for a phased deployment of high-performance compute without the cost and delay of new construction. Additionally, we are in the final stages of engineering work for our first tower deployment and continue to expand the future available footprint there by deepening and broadening our relationships with our tower partners. Together, these sites give us a foundation to expand our footprint significantly over time. How we structure this growth matters as much as how fast we grow. Our approach is to align capital commitments with customer demand and to minimize the capital we commit upfront.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

We are working closely with offtake partners, equipment providers, and financing partners on project-level structures that combine customer prepayments with equipment-backed financing. That allows us to monetize our powered site footprint as fully and responsibly as possible. I want to speak candidly about the market environment because it has shifted significantly recently and directly affects how and when we deploy capital. Several pressures were already building across the AI compute market before the midterm elections. Memory shortages have pushed AI server prices higher, with suppliers signaling increases of more than 15% for system shipping in early 2027. Market rental rates for the latest generation GPUs have risen roughly 15% in the past month alone, and lenders have been repricing GPU-backed debt, with spreads on some recent financings widening by hundreds of basis points. Yields on unsecured AI infrastructure bonds rising above 15%.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

The results of last week's midterm elections accelerated already volatile conditions. The market is now pricing in a meaningful risk that new state and federal policies will restrict or delay data center construction. Project and execution uncertainty is flowing directly into the financing uncertainty, causing prices and spreads to rise across the board and making deals more difficult to execute. Over the long term, we believe these new market realities could benefit Forum. If new data center construction becomes harder, slower, and more expensive, data center capacity that is already permitted, powered, and built becomes more valuable. That is exactly what we have. Our North Carolina campus has approximately 9 MW of existing utility power. Our Dallas data center has upgraded power infrastructure in place today, and our tower strategy relies on powered sites that already exist.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

We do not need to break ground on new data centers to grow, and we are not exposed to the permitting and construction risks that are now weighing on the sector. In this environment, access to those sites is one of our most valuable competitive advantages. Our responsibility to shareholders is to monetize them fully, and that means not committing scarce, ready-to-use capacity at prices or on terms that undervalue it. We intend to be diligent in ensuring that every megawatt we deploy earns the greatest risk-adjusted return we can achieve. In the near term, however, this environment calls for patience and caution. When compute pricing, equipment costs, and financing costs are all moving this quickly, the risk is locking in multi-year customer contracts at one set of prices while equipment and financing costs reset higher. That is how margins get compressed for years.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Given the size of capital involved and the risks that come with it, we are not willing to take that chance. We are therefore working with both new and existing offtake partners to ensure our agreements can be deployed on mutually beneficial and secure terms. We intend to move deliberately in the near term until some of this volatility subsides. We continue to advance our sites, our customer discussions, and our financing arrangements, but we will commit capital and sign contracts only when pricing, equipment costs, and financing terms work together to deliver the returns we expect. John will discuss how this approach affects our 2026 outlook in his remarks. Our pipeline has never been stronger, and that gives us better visibility and demand.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Over time, our hub-and-spoke model gives us a framework to expand into additional metropolitan markets by pairing regional data centers with distributed compute at existing tower sites. We view our initial deployment as the foundation of a much larger network, but our objective is not simply to add compute capacity. It is to build a scalable infrastructure business that generates attractive returns and recurring cash flow. Outside of AI infrastructure, our aviation business continues to provide a base of contracted income for our five commercial aircraft engines on long-term lease to two of the largest U.S. airlines. Those engines generate all of our third-quarter revenue, and we continue to view them as attractive investments in their own right that also provide diversification and financial flexibility as we build out our AI infrastructure business. Manufactured housing and auto credit remain complementary sources of secured cash-generating assets.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Ultimately, we will be measured by execution. In a market this volatile, that means staying disciplined, protecting the value of the sites that are permitted, powered, and built, and committing capital only when the economics are right and putting profitability and recurring cash flow ahead of growth for its own sake. We have established the foundation for what we believe can become a substantial AI infrastructure business. Our focus over the next several quarters is to build it carefully and with a steady hand so that what we create is durable, scalable, and profitable over the long term. With that, I'll turn the call over to John.

[John Saunders, CFO at Forum Markets]

Thank you, McAndrew, and good morning, everyone. I'll review our third-quarter results, followed by our balance sheet and capital allocation, and then our financial outlook. Turning to the third quarter, Forum generated revenue of approximately $2 million, compared with approximately $1.4 million in the second quarter of 2026 and $4.1 million in the third quarter of 2025. All of our third-quarter revenue came from commercial aircraft engine leases. The sequential increase reflects the contribution from the two engines we acquired after the end of the second quarter, both of which were on lease and generating revenue at the time of purchase. The year-over-year decline reflects the elimination of staking and related digital asset revenue as we transitioned away from our previous operating model. Cost of revenue was approximately $0.4 million, resulting in gross profit of approximately $1.6 million.

[John Saunders, CFO at Forum Markets]

Selling, general, and administrative expenses were approximately $8.7 million, compared with $10.3 million in the second quarter. Third-quarter expenses included approximately $2.7 million of non-cash stock-based compensation expense. Second-quarter expenses included approximately $1.8 million of one-time cash charges that did not recur in the third quarter. We continue to invest in the people, systems, and capabilities required to build our AI infrastructure platform while maintaining a disciplined approach to operating expenses. Net income from continuing operations for the quarter was approximately $7.9 million, or $0.52 per basic share and $0.47 per diluted share, compared with a net loss from continuing operations of $12.4 million in the second quarter. Third-quarter results included a non-cash gain of approximately $13.9 million from the change in fair value of our digital asset holdings, as well as approximately $0.5 million of interest income, primarily from our manufactured housing and auto loan portfolios.

[John Saunders, CFO at Forum Markets]

Adjusted EBITDA for the quarter was approximately $12.8 million, compared with an adjusted EBITDA loss of approximately $7.4 million in the second quarter. Third quarter adjusted EBITDA included the $13.9 million non-cash gain on our digital assets. Changes in the value of digital assets can create significant swings in our reporting results. As our operating business scales, we expect contracted asset income and AI compute revenue to become the primary drivers of our financial performance. Turning to the balance sheet, as of September 30, 2026, total assets were approximately $166.8 million, including approximately $15.4 million of cash equivalents, and marketable securities, $35.5 million of digital assets, $41.8 million of property and equipment, primarily our commercial aircraft engines, $20.9 million of loans receivable and accrued interest, primarily manufactured housing and auto loans, and $45.7 million of strategic equity investments. Total liabilities were approximately $30.4 million.

[John Saunders, CFO at Forum Markets]

We estimate net asset value at approximately $136.4 million, or approximately $9.74 per share. In the third quarter, we deployed approximately $23.7 million in cash to acquire the two aircraft engines we discussed on our last call, which is reflected in the increase in property and equipment. During the quarter, we repurchased approximately 330,000 shares for approximately $1.9 million at an average price of $5.82 per share. Since January 1, 2026, we have repurchased approximately 7.4 million shares for approximately $33.2 million, and all repurchased shares have been retired. We have approximately $19.8 million remaining under our repurchase authorization. Shares outstanding increased modestly from June 30, primarily reflecting shares issued in connection with stock-based compensation. Looking ahead, we will continue to direct capital to where it earns the best risk-adjusted return for shareholders.

[John Saunders, CFO at Forum Markets]

Today, our priority is building our AI infrastructure platform while continuing to manage our existing portfolio of income-producing assets. Our initial compute deployments are expected to be structured around customer contracts, customer prepayments, and equipment-backed financing. Our goal is to match capital deployment with customer demand while maintaining a disciplined approach to risk and to the use of our balance sheet. Turning to guidance, as McAndrew discussed, we have chosen to slow the pace of deployment of our initial AI compute capacity in response to rapidly rising compute pricing, equipment costs, and financing costs, which accelerated following the midterm elections. Our prior 2026 guidance assumed that initial compute capacity would be deployed and generating revenue in the fourth quarter. Under our more deliberate timeline, we will no longer expect compute revenue in 2026.

[John Saunders, CFO at Forum Markets]

We now expect full-year 2026 revenue in the range of $8 million-$9 million, compared with our previous range of $18 million-$22 million. Revenue for the first nine months of the year was approximately $6.2 million, and our fourth-quarter revenue is expected to come primarily from our aircraft engine portfolio. For 2027, we are maintaining our revenue guidance of $125 million-$175 million. We are in discussions with multiple potential partners on how best to structure our agreements in the current market environment. These structures could involve higher GPU pricing, larger upfront customer deposits, changes in offtake duration, and revisions to or terminations of existing contracts, each with different trade-offs among revenue, EBITDA margins, and cash flow.

[John Saunders, CFO at Forum Markets]

GPU pricing has risen, and the market is trending towards higher upfront deposits for a variety of reasons, including the cost of GPU equipment and the cost of debt capital. We will update our guidance once our Dallas and North Carolina capacity is fully contracted and the mix of customer deposits and financing is finalized. We are equally prioritizing margins. We intend to align new customer contracts with equipment purchase and financing so that we are not locking in revenue at one price while our costs reset higher. That discipline may affect timing, but we believe it will produce better returns over the life of these valuable assets. Our focus remains on disciplined capital allocation, deploying capital efficiently against customer demand, and building for the long-term earning power of the business. With that, I'll turn the call back over to the operator for questions.

[Operator]

We will now begin the question-and-answer session. If you would like to ask a question, please use the raise hand icon, which can be found in the black bar at the bottom of the webinar application screen. When you hear your name called, you will be prompted to unmute your line and ask a question. We will now take a moment to allow the queue to form. Our first question comes from Brendan McCarthy with Sidoti. You may unmute your line and ask your question.

[Brendan McCarthy, Analyst at Sidoti]

Great. Good morning, everybody. Thanks for taking my questions here. Just wanted to start off on the Fireworks contract. Can you give some commentary or color on if the terms of that contract are still in place on the original terms, and is it still economically attractive for you at this point?

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Hey, Brendan. I will just say generally, we are kind of working with all of our partners, Fireworks included, just thinking through what the best solution is for all of our data centers. I think everyone in the industry is thinking about it. I will say right now, we are just evaluating that and everything else, and we are just being very careful about how we contract North Carolina and Dallas going forward. The answer is, I think the entire industry is just evaluating contract structures right now.

[Brendan McCarthy, Analyst at Sidoti]

Understood. That makes sense. Is it more a question of, has financing dried up here, or is it more just the cost of that financing has become unattractive under current contract terms or prospective contract terms?

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

I'll say exactly what Corey said on their call. What we're seeing generally is that customers are willing to put up 70%-100% deposits on equipment to do deals at this point, because there is no reason to take on extremely high-cost financing to buy the equipment, and the cost of the equipment continues to go up. So, things that we are looking at going forward are basically financed by customers completely.

[Brendan McCarthy, Analyst at Sidoti]

Got it. And there is an avenue where you could alter the Fireworks contract to match those terms, I assume?

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Yes.

[Brendan McCarthy, Analyst at Sidoti]

Okay.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Or do something else entirely.

[Brendan McCarthy, Analyst at Sidoti]

Okay. Just last question from me, just on-

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Brendan, I think what the most important thing to realize is the prices for the compute have risen dramatically in the last couple of weeks, and the market is just repricing that change. I think that's the same thing that's been echoed on every conference call to date in the marketplace, is just that the price per GPU-hour has gone up drastically. That's just because the absolute supply of available megawatts that are going to come online has gone down dramatically.

[Brendan McCarthy, Analyst at Sidoti]

Okay. Got it. That's helpful. I appreciate the detail. Then just on the balance sheet, I guess all cash and equivalents was roughly $15 million at quarter end. Are you going to need additional capital to complete Phase 0? I guess what financing sources are available

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

No

[Brendan McCarthy, Analyst at Sidoti]

at this point?

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

We won't need more capital to complete Phase 0. We have our engine portfolio. It's highly liquid. We want to leverage it if we can. I think what we're seeing is most of the customers who absolutely need the capacity in terms of the compute are willing to put up close to 100% of the capital to get the compute and power up. So, it really then just comes down to how do you price that compute. So, we may end up not taking on much leverage at all, if any, to put GPUs in the data centers, is the bottom line, which was not something that we modeled, and it is a very different scenario that has unfolded here in the last couple of weeks, but that's just where the market is.

[Brendan McCarthy, Analyst at Sidoti]

Got it. Okay, that makes sense. That is all for me. I will hop back in the queue. Thank you.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Yep.

[Operator]

Again, if you would like to ask a question, please use the raise hand icon, which can be found on the black bar at the bottom of your webinar application screen. When you hear your name called, you will be prompted to unmute your line and ask a question. Our next question is from Brian Dobson with Clear Street. You may unmute your line and ask your question.

[Jonah Henschel, Analyst at Clear Street]

Hey, this is Jonah Henschel calling on for Brian Dobson here at Clear Street. If customers are funding, as you guys said, around 70%-100% of the GPUs, does Forum still own the equipment and keep residual value, or does the ownership then shift onto the customer?

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Jonah, great question. Part of the negotiations. That recirculates directly back into the GPU pricing discussion, and we are working through that right now. I think that is some of the math that the whole industry is doing. If we do not own the residual, then there are really just two models. We own it and get a piece of that upside and take a lower price, and if we do not own it, then we get a higher price. It is pretty much that simple, and everyone is working through that math right now. Some companies just do not have the capacity to want to keep that residual on their balance sheet because that is not their business model, and then others do want to keep it. It is really just a function of how their financing is set up.

[Jonah Henschel, Analyst at Clear Street]

Understood.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

But we are in an interesting position right now where we can do either structure for people because we have a contract and the capacity.

[Jonah Henschel, Analyst at Clear Street]

Got you. Okay. Thanks for that color.

[McAndrew Rudisill, Chairman and CEO at Forum Markets]

Yep.

[Operator]

There are no further questions at this time. I will now turn the call back to John Kristoff for closing remarks.

[John Kristoff, SVP of Corporate Communications and Investor Relations at Forum Markets]

Thanks, Justin, and thank you, everyone, for joining us this morning. As always, if you have additional follow-up questions, please reach out to me directly. Thanks.

[Operator]

The call has concluded. Thank you for joining. You may now disconnect.

Participants

Executives

• John Kristoff, SVP of Corporate Communications and Investor Relations
• McAndrew Rudisill, Chairman and CEO
• John Saunders, CFO

Analysts

• Brendan McCarthy, Analyst at Sidoti
• Jonah Henschel, Analyst at Clear Street