Forum Markets (NASDAQ:FRMM) cut its 2026 revenue forecast and said it no longer expects artificial intelligence compute revenue this year as it slows initial deployments amid rising equipment and financing costs.
The company now expects full-year revenue of $8 million to $9 million, down from its previous forecast of $18 million to $22 million. It maintained its 2027 revenue guidance of $125 million to $175 million, while saying it would update the outlook once capacity at its Dallas and North Carolina sites is fully contracted and financing arrangements are finalized.
For the third quarter, Forum reported approximately $2 million in revenue, up from $1.4 million in the preceding quarter but down from $4.1 million a year earlier. All of the quarter’s revenue came from commercial aircraft engine leases.
AI Deployment Slows as Costs Rise
Chairman and CEO McAndrew Rudisill said Forum is moving deliberately on its AI infrastructure plans because compute pricing, equipment costs and financing costs are changing quickly. Locking in multiyear customer contracts before costs are settled could compress margins, he said.
Forum established its Forum Edge AI platform in October to deploy GPU compute capacity at existing powered data centers and communications tower sites. Its near-term priorities include enhancements to its High Point, North Carolina, data center and preparation of additional capacity in Dallas. Rudisill said both sites are permitted, powered and built, while engineering work for the first tower deployment is in its final stages.
Rudisill said memory shortages have pushed AI server prices higher and that suppliers are signaling increases of more than 15% for systems shipping in early 2027. He also said market rental rates for the latest-generation GPUs had risen roughly 15% in the past month, while some GPU-backed financing spreads had widened by hundreds of basis points.
He attributed an acceleration in volatility to the prior week’s midterm election results, saying the market was pricing in a risk that new state and federal policies could restrict or delay data center construction. Existing powered sites could become more valuable if new construction becomes harder and more expensive, he said.
Customer Funding and Contracts Under Review
Chief Financial Officer John Saunders said potential agreement structures could include higher GPU pricing, larger upfront customer deposits, changes to contract duration, and revisions to or terminations of existing contracts. Each would have different implications for revenue, margins and cash flow, he said.
Asked about the company’s contract with Fireworks, Rudisill said Forum was evaluating arrangements with all its partners. He said the Fireworks contract could be altered to reflect changing terms, or the company could “do something else entirely.”
Rudisill said some customers are willing to provide deposits covering 70% to 100% of equipment costs. Forum may therefore take on little or no leverage to install GPUs, he said. He also said the company would not need additional capital to complete its initial Phase 0 deployment.
Whether Forum or its customers would own equipment and retain its residual value remains part of negotiations, Rudisill said. The trade-off could involve a lower compute price if Forum retains ownership and potential upside, or a higher price if it does not, he said.
Quarterly Results and Balance Sheet
Forum reported net income from continuing operations of approximately $7.9 million, or 47 cents per diluted share, compared with a $12.4 million loss in the second quarter. The latest quarter included a $13.9 million non-cash gain from changes in the fair value of digital assets.
Adjusted EBITDA was approximately $12.8 million, compared with an adjusted EBITDA loss of $7.4 million in the prior quarter. The third-quarter figure also included the digital-asset gain. Saunders cautioned that changes in digital-asset values can cause significant swings in reported results.
The sequential revenue increase reflected two aircraft engines acquired after the second quarter, while the year-over-year decline reflected the elimination of staking and related digital-asset revenue as Forum moved away from its previous operating model, Saunders said. The company’s five commercial aircraft engines are on long-term lease to two major U.S. airlines.
As of September 30, Forum had approximately $166.8 million in total assets and $30.4 million in liabilities. It estimated net asset value at $136.4 million, or $9.74 per share.
Forum repurchased approximately 330,000 shares for $1.9 million during the quarter. It had about $19.8 million remaining under its repurchase authorization, Saunders said.
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.
