Forum Markets Eyes AI Compute Growth as Aircraft Engines Drive Cash Flow

Key Points

• Aircraft engines are Forum Markets’ primary current investment focus: The company owns seven CFM56 engines, with five already contracted and generating rental revenue, and expects potential net returns in the mid-teens.
• AI compute could become the company’s largest growth driver. Forum is pursuing a partnership involving facilities with available power, permits and cooling, but financial terms have not been finalized; the project could contribute materially to fourth-quarter 2026 revenue.
• Forum reiterated its goal of exiting 2026 with $100 million to $175 million in assets under management and $18 million to $22 million in revenue, while targeting cash-flow positivity in early 2027.

Forum Markets NASDAQ: FRMM outlined its strategy to build a portfolio of cash-flowing real-world assets while retaining the option to fractionalize or tokenize those assets as digital-market infrastructure and regulation develop.

Speaking at the Sidoti conference, John Kristoff, senior vice president of corporate communications and investor relations, said the company is targeting asset classes with high risk-adjusted returns, durable demand, scalable markets and high-quality counterparties. Forum’s current focus includes aircraft engines, AI infrastructure, modular-home financing and auto credit.

Kristoff said the company’s near-term model is centered on acquiring assets, generating cash flow, distributing returns where appropriate and reinvesting to expand its asset base. Tokenization is intended as a secondary opportunity rather than the immediate core of the business, he said.

Aircraft Engines Lead Current Deployment

Chief Financial Officer John Saunders said aircraft engines represent Forum’s largest current area of capital deployment. The company is focused on CFM56-7B and 5B engines used in narrow-body commercial aircraft.

Forum has acquired five engines, all of which are contracted and generating rental revenue, Saunders said. The company acquired two additional engines after quarter-end and disclosed the purchases in an 8-K filing.

According to Saunders, Forum inspects engines before acquisition, reviews FAA maintenance records and contracts primarily with Delta Air Lines, United Airlines or American Airlines. The engines operate principally on domestic U.S. routes, with some Caribbean routes, he said. The company also negotiates guaranteed residual purchase prices at the end of its contracts and insures the engines throughout the holding period.

Saunders said the company expects tokenized engine investments, after management fees and including debt and depreciation considerations, to generate net returns in the mid-teens. He also cited potential tax benefits from bonus depreciation that could be distributed to investors through a K-1 structure.

In response to a question about why airlines, rather than aircraft manufacturers, are the customers, Saunders said major airlines lease engines and airframes rather than deploy substantial capital to own all of them. Airlines use separate engine pools to keep aircraft operating while engines undergo maintenance or overhaul, he said.

AI Compute Project Expected to Support Growth

Forum expects AI infrastructure to become its second-largest vertical or potentially its largest over time. Saunders said the company has been evaluating bridge financing for GPU acquisitions as well as AI compute opportunities, and is working toward announcing a compute partnership in the coming weeks or months.

He said the planned transaction would be a compute deal rather than a bridge-financing arrangement. Forum is focusing on facilities with immediately available power, permits and cooling capacity, which would allow GPUs to be installed and begin generating revenue quickly.

Saunders said the company sees shortages of available power as a key bottleneck for AI compute projects. He also said Forum expects demand for compute capacity to become more localized and regional over time. Once that vertical is established and scaled, the company could consider tokenizing fractional ownership in projects or in the compute chips themselves.

The company did not disclose financial terms or other details of the prospective partnership, noting that the transaction has not yet been finalized.

Other Credit Verticals

Forum is also developing a modular-home mortgage business through a partnership with Zippy. Saunders said the vertical targets annualized yields of 9% to 11% and is supported by AI underwriting and community recourse during the first five years of originated loans. He said repossession of a mobile home can be less complex than a traditional real-estate foreclosure in cases of nonperformance.

In auto financing, Forum has established a warehouse facility that Saunders said is producing annualized yields of 12% to 13%. The facility supports weekend loan originations and includes contractual obligations requiring the originator to remove nonperforming loans that are not acquired by a takeout partner. Saunders characterized the facility’s default exposure as virtually zero and said it provides Forum with an option to acquire loans directly as the business expands.

Forum has partnered with Karus in the auto-credit segment, Saunders said, citing its AI underwriting capabilities.

Revenue Outlook and Capital Plans

Forum reported $1.4 million in revenue for its most recently closed quarter and expects revenue to increase significantly in the third quarter, Saunders said. He attributed the expected increase to a full period of rental contributions from the company’s growing aircraft-engine portfolio.

The company reiterated its expectation to exit 2026 with $100 million to $175 million in assets under management and full-year revenue of $18 million to $22 million. Saunders said the revenue outlook is heavily weighted toward the fourth quarter, when the proposed AI compute project is expected to contribute materially if it comes online, potentially in November or December.

Forum is targeting cash-flow positivity in early 2027. Saunders said the company is seeking to reduce cash operating expenses, which it expects to run at roughly $4 million to $4.5 million per quarter going forward, with potential for further reductions. He noted that the prior quarter included $3.8 million of stock-based compensation and $1.8 million of transition costs tied to exits from its biotech and digital-asset treasury businesses.

The company has also repurchased approximately 35% of its outstanding shares, Saunders said. Looking ahead, Forum intends to pursue both institutional and tokenized distribution channels, with the goal of generating origination, management and potentially exchange-trading fee revenue while recycling capital into its targeted asset verticals.

About Forum Markets (NASDAQ:FRMM)

Forum Markets 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.

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