Breaking Down Soluna Holdings, Inc. (SLNH) Financial Health: Key Insights for Investors

You're looking at Soluna Holdings, Inc. (SLNH) and seeing two very different numbers from their latest Q3 2025 report, so let's cut through the noise right away: the company is executing on growth, but the financials still carry significant non-cash baggage. Operationally, the shift to green data centers for high-performance computing (HPC) and AI is gaining traction, with revenue jumping a strong 37% sequentially, hitting about $7.52 million for the quarter. That's a clear sign their business model is starting to scale. But you can't ignore the headline net loss of $25.8 million for the quarter; to be fair, that loss was mostly driven by a one-time, non-cash fair value adjustment on exercised warrants, not core operations. The real story is the strengthened balance sheet, which now holds a record $60.5 million in cash, plus a new scalable credit facility up to $100 million from Generate Capital, giving them the firepower to defintely accelerate their 1 gigawatt pipeline. That's the kind of capital structure work that changes the risk profile.

Revenue Analysis

You're looking at Soluna Holdings, Inc. (SLNH) and seeing a complex revenue picture for 2025: near-term sequential growth is strong, but the year-over-year trend is still recovering from a strategic shift. The direct takeaway is that the company is successfully pivoting its revenue mix, with hosting now dominating, but the full-year numbers still reflect the prior year's challenges.

For the third quarter ended September 30, 2025, Soluna Holdings, Inc. reported revenue of $8.42 million, which is an increase of about 12% compared to the $7.53 million reported in Q3 2024. More importantly, that's a sequential jump of 37% from Q2 2025's $6.2 million, driven by new customer deployments at Project Dorothy 2. Here's the quick math: that $2.3 million quarter-over-quarter increase shows immediate execution on new capacity. Still, looking at the nine months of 2025, total revenue was $20.51 million, which is down from the $29.75 million in the same period last year, so the overall annual trend is defintely mixed.

The core of the business is shifting, and this is the most critical insight for investors. Soluna Holdings, Inc. is a developer of green data centers for intensive computing applications, and its revenue is now heavily weighted toward hosting third-party miners, moving away from proprietary Bitcoin mining (which is where most of the volatility lives). The company is also strategically exiting non-core contracts, like the one with Hewlett Packard Enterprise (HPE), to focus on higher-margin data center hosting and the emerging High Performance Computing (HPC) or Artificial Intelligence (AI) market.

As of Q3 2025, the breakdown of the $8.42 million in revenue clearly shows this pivot. Data center hosting is now the primary engine, which is a much more stable, recurring revenue stream than proprietary mining. For a deeper dive into the company's balance sheet and valuation, you can check out the full analysis at Breaking Down Soluna Holdings, Inc. (SLNH) Financial Health: Key Insights for Investors.

Here is how the segments contributed to the Q3 2025 revenue:

The move to prioritize hosting is a smart, defensive play. It gives Soluna Holdings, Inc. more predictable cash flow and positions them to capture the massive demand from AI clients, a market they are now targeting with new projects like Kati 2. This is what you want to see: a business model that works and scales.

• Hosting revenue is now the main driver.
• New Project Dorothy 2 customers fueled Q3 growth.
• Strategic pivot targets AI/HPC for future stability.

Action Item: Finance should model future revenue with a 70/30 Hosting/Mining split to reflect this strategic shift by end of month.

Profitability Metrics

You need to know if Soluna Holdings, Inc. (SLNH) is moving toward sustainable profitability, and the third quarter of 2025 (Q3 2025) data shows a mixed, but improving, operational picture. The headline is that the company's gross margin is strengthening, but the net loss is still substantial due to non-operational charges. This is a classic growth-stage profile: strong unit economics but high overhead.

For Q3 2025, Soluna Holdings, Inc. reported revenue of $8.42 million, a 37% sequential increase from the prior quarter. However, the net loss for the period was a significant $23.96 million, which translates to a stark Net Profit Margin of approximately -284.6%. Honestly, that Net Loss figure is a massive red flag, but it's crucial to understand what caused it.

• Gross Profit Margin: The margin was 28% in Q3 2025, a solid jump from the 19% seen in Q2 2025.
• Operating Profit Margin (Adjusted): The Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) was ($6.4 million), giving an Operating Margin of approximately -76.0%.
• Net Profit Margin: The Net Loss of $23.96 million yields a Net Profit Margin of approximately -284.6%.

Operational Efficiency and Margin Trends

The real story here is the operational efficiency, which is where the company has shown clear improvement. The Gross Profit Margin (Gross Profit divided by Revenue) rising from 19% to 28% sequentially in Q3 2025 is a powerful sign of better cost management and margin stability. This jump was partly driven by a $400,000 one-time electricity credit, but also by strong cost discipline. Even better, two of their key sites, Dorothy 1A and Sophie, delivered exceptional gross margins of 43.6% and 68.4%, respectively.

Here's the quick math on the operating side: The Adjusted EBITDA, excluding special charges, was a positive $0.1 million in Q3 2025, which gives a positive operating margin of about 1.2%. This shows that the core business of running data centers and hosting is starting to break even before factoring in the non-cash and one-time corporate expenses. The massive Net Loss of $23.96 million was largely driven by a $22.0 million fair value adjustment of exercised warrants and other financing expenses.

Industry Comparison and Actionable Insight

When you compare Soluna Holdings, Inc.'s gross profitability to the broader renewable-powered Bitcoin mining industry, the site-level margins are competitive. Operations with access to cheap, hydro-electric power can maintain profit margins in the 60-70% range, so Sophie's 68.4% gross margin is defintely in the top tier. The company's overall Q3 gross margin of 28% is solid, given the industry's energy costs now account for 60-90% of total operational expenses. The company's focus on co-locating with renewable energy sources is a structural advantage that helps stabilize these margins long-term, especially as the global average cost for industrial mining operations hovers around $0.05-$0.07 per kWh.

The trend is clear: operational efficiency is improving, but corporate-level costs and financing expenses are masking that progress. The path to net profitability hinges on scaling up the high-margin sites like Sophie and Dorothy 1A, while those one-time financing costs roll off the books.

For a deeper dive into the company's full financial picture, including liquidity and valuation, you should read the full post: Breaking Down Soluna Holdings, Inc. (SLNH) Financial Health: Key Insights for Investors.

Debt vs. Equity Structure

You need to know how Soluna Holdings, Inc. (SLNH) is funding its expansion into AI and green data centers, and the answer is a balanced, but rapidly shifting, mix of debt and equity. As of November 2025, the company's Debt-to-Equity (D/E) ratio is around 0.34, meaning it uses about 34 cents of debt for every dollar of shareholder equity.

This ratio is low compared to many capital-intensive sectors, which is generally a good sign of financial stability. But, honestly, the whole Bitcoin mining and AI data center space is seeing a massive surge in leverage right now. Total debt across the mining industry has ballooned 500% in one year to $12.7 billion, so even a low D/E ratio needs careful monitoring as the company scales.

Here's the quick math on their current debt load:

• Short-Term Debt: Approximately $13.32 million, as of September 2025.
• Long-Term Debt: Approximately $10.190 million, as of March 2025.

The total debt is roughly $23.3 million. What this breakdown hides is the immediate pressure from the short-term portion, which is higher than the long-term portion. To be fair, a competitor like Bit Digital has an even lower D/E of 0.07, but Soluna Holdings, Inc.'s ratio is still conservative given the high-growth, high-capital nature of building out new data centers.

The company is actively balancing debt and equity to fuel its growth. In Q3 2025, Soluna Holdings, Inc. secured a scalable credit facility of up to $100 million from Generate Capital, with an initial draw of $12.6 million in September to fund refinancing and construction. Plus, they secured $20 million from Spring Lane Capital to launch Project Kati 1.

They are also tapping equity markets. In July 2025, they completed a public offering that raised approximately $5 million. This mix shows a deliberate strategy: use project-level debt (like the Generate Capital facility) for specific, predictable cash-flow assets, and use equity to cover working capital and general corporate purposes. This is defintely a smart way to minimize cost of capital while keeping the balance sheet from getting too heavy with corporate debt. They also resolved outstanding matters with NYDIG in September 2025, which clears the path for future growth and partnerships.

For a deeper dive into the company's full financial picture, you can read more at Breaking Down Soluna Holdings, Inc. (SLNH) Financial Health: Key Insights for Investors.

Next Step: Portfolio Manager: Model the impact of drawing the full $100 million credit facility on the D/E ratio and interest coverage by the end of Q4 2025.

Liquidity and Solvency

You need to know if Soluna Holdings, Inc. (SLNH) can cover its near-term obligations, especially as they pivot toward AI data centers. The direct takeaway is that while traditional liquidity ratios signal stress, the company's recent, successful capital raises have dramatically improved its cash position and financing flexibility, which is the real story here.

Assessing Soluna Holdings, Inc. (SLNH)'s Liquidity

Looking at the standard liquidity metrics for Soluna Holdings, Inc. (SLNH) reveals a tight spot. As of the most recent reporting period, the Current Ratio stood at just 0.35, and the Quick Ratio was also 0.35. To be fair, a ratio below 1.0 means current liabilities outweigh current assets, suggesting the company would struggle to pay off all its short-term debt immediately. This is defintely a flashing yellow light for short-term operational risk.

The Quick Ratio (Acid-Test Ratio), which excludes less-liquid assets like inventory, is identical at 0.35. This tells us that even removing inventory, the liquidity picture doesn't change, underscoring the challenge of meeting obligations solely with the most liquid assets. This financial snapshot reflects pressing challenges, but the capital markets have recently thrown a lifeline.

Working Capital and Cash Flow Trends

The trend in working capital (Current Assets minus Current Liabilities) shows some movement. The change in working capital for the trailing twelve months (TTM) ended June 2025 was a positive $8.01 million, indicating an increase in operating assets or a decrease in operating liabilities. Still, the company's overall cash flow performance highlights the capital-intensive nature of its expansion.

The cash flow statements paint a mixed picture, typical for a high-growth infrastructure developer. While the reported operating cash flow for the 2025 fiscal year was approximately $0.00, the free cash flow for the same period decreased by $-2.70 million. The real strength, however, is in the financing activities, which have been robust:

• Cash and restricted cash reserves swelled to a record $60.5 million in Q3 2025.
• The company raised over $64 million gross capital in Q3 2025 through a mix of equity and debt.
• A new scalable credit facility of up to $100 million was secured from Generate Capital, with an initial $12.6 million draw in September 2025.

The capital raises are the key action here. They are essentially financing the transition from a crypto-mining focus to a broader AI and high-performance compute data center model, which requires significant upfront investment.

Liquidity Strengths and Concerns

The primary liquidity concern is clearly the low current and quick ratios, which are well below the healthy benchmark of 1.0. This means the company still relies heavily on external financing to bridge the gap between its current assets and liabilities. However, the Q3 2025 results show a deliberate and successful effort to mitigate this risk by strengthening the balance sheet.

Here's the quick math: The influx of cash and the new credit facility provide a substantial buffer. The $60.5 million in cash reserves is a massive increase, bolstering the company's ability to fund its operations and construction of projects like Project Kati. This strategic capital infusion is a major strength, reducing the immediate risk of a liquidity crisis and even helping Soluna Holdings, Inc. (SLNH) regain Nasdaq compliance. This shift in financing strategy is a critical point for investors to understand. For a deeper dive into the company's strategic pivot, check out Breaking Down Soluna Holdings, Inc. (SLNH) Financial Health: Key Insights for Investors.

Valuation Analysis

You're looking at Soluna Holdings, Inc. (SLNH) and trying to figure out if the stock price makes sense right now. The short answer is that traditional valuation metrics are flashing a complex signal, suggesting the stock is either priced for significant future growth or is currently overvalued, depending on your risk tolerance and belief in their long-term strategy. The consensus among a small number of Wall Street analysts leans toward a Reduce/Hold rating, not a strong buy.

The company's stock price has been highly volatile, which is common for companies in the renewable energy-powered cryptocurrency mining and high-performance computing (HPC) space. Over the last 12 months, the stock has seen a massive swing, from a 52-week low of $0.36 to a 52-week high of $5.14. As of November 20, 2025, the closing price was around $1.60, representing a significant decline of about -59.08% over the last 52 weeks.

Here's the quick math on the key valuation ratios for Soluna Holdings, Inc. (SLNH) based on recent fiscal year data:

• Price-to-Earnings (P/E) Ratio: Not applicable (N/A). The company has negative earnings per share (EPS) of approximately -$8.02 on a trailing twelve-month (TTM) basis, which makes the P/E ratio meaningless for valuation.
• Price-to-Book (P/B) Ratio: Approximately 7.08. This is a high multiple, suggesting the market is valuing the company at over seven times its net asset value (book value), which points to a growth-stock premium.
• Enterprise Value-to-EBITDA (EV/EBITDA): Approximately -1.7x (LTM). A negative EV/EBITDA multiple is a red flag, indicating negative earnings before interest, taxes, depreciation, and amortization (EBITDA). This means the company is not generating positive operating cash flow before accounting for capital structure and non-cash charges.

The high P/B ratio and negative EV/EBITDA tell a story of a company with significant capital investment (hence the book value) that is currently unprofitable at the operating level. You are defintely paying for the future potential of their renewable energy data center projects, like the recently completed Project Dorothy 2, which increased operational capacity to 123 MW. This is a bet on execution.

Soluna Holdings, Inc. does not currently pay a dividend, so the dividend yield and payout ratio are both 0.00%. This is expected for a growth-focused company prioritizing capital reinvestment over shareholder payouts. If you want income, this isn't the stock. For a deeper dive into their long-term plans, you should check out the Mission Statement, Vision, & Core Values of Soluna Holdings, Inc. (SLNH).

Analyst sentiment is mixed but cautious. The overall consensus rating is a 'Reduce' or 'Hold,' with one analyst issuing a 'Sell' rating and another a 'Hold' rating in the last 12 months. This suggests that while there is some optimism about the long-term story, most analysts are not yet convinced the current price offers a compelling entry point for new investors.

Risk Factors

You're looking at Soluna Holdings, Inc. (SLNH) and seeing a fascinating story: green energy meets high-performance computing. That pivot is smart, but let's be real-the financials show this is a high-wire act. The core risk isn't the technology; it's the capital structure and the market's brutal volatility. This isn't a stock for the faint of heart.

The company's stock volatility is extremely high, reflected in a Beta of 6.37, meaning it moves over six times the market average. The most immediate financial red flag is the distress-level Altman Z-Score of -6.19, which signals a significant risk of bankruptcy within the next two years. You simply cannot ignore that number. Plus, the Net Loss for Q3 2025 was $25.8 million, a sharp increase from the previous year, showing that the growth story hasn't translated to profitability yet.

Here's a quick look at the internal and external risks hitting Soluna Holdings, Inc. right now:

• Financial Liquidity: The Current Ratio is around 0.35, far below the 1.0 needed for healthy short-term liquidity, and the company has a working capital deficit of $30.87 million. This means they need to keep raising capital, which brings us to the next point.
• Dilution Pressure: Ongoing operating losses and negative free cash flow force Soluna Holdings, Inc. to continually seek new financing, which can dilute the value of your existing shares. They've been active, raising over $64 million in Q3 2025 alone through a mix of equity and debt.
• Profitability Gap: The company still faces massive operational challenges, with an Operating Margin of -105.6% and a Net Margin of -222.81% as of late 2025. They are burning cash to fuel expansion.

The external risks are just as sharp, especially given their dual focus on renewable energy and computing. The inherent volatility of the cryptocurrency market is a constant threat, as Bitcoin price swings directly impact their mining revenue. Also, a lot of their capacity is concentrated in Texas, which exposes them to the specific regulatory and weather risks of that region's energy grid.

To be fair, Soluna Holdings, Inc. is actively trying to de-risk. Their strategic shift is the key mitigation plan. By moving away from pure Bitcoin mining toward High-Performance Compute (HPC) and AI data center hosting, they are diversifying their revenue stream and targeting the explosive AI demand. This is a smart move to reduce their reliance on volatile crypto prices. They've also secured a scalable credit facility up to $100 million from Generate Capital and a $20 million commitment for Project Kati, which strengthens their balance sheet and provides growth capital. Their Gross Margin also improved significantly to 28% in Q3 2025, up from 19% in Q2 2025, which shows better cost discipline and operational efficiency.

The table below summarizes the core financial risks and the company's Q3 2025 mitigation actions:

The bottom line is that Soluna Holdings, Inc. is a high-risk, high-reward play right now. They've shored up the balance sheet and have a clear strategy, but the financial metrics still point to significant underlying strain. You need to keep a close eye on their ability to execute on Project Dorothy 2 and Project Kati, which are key to the AI pivot. For a deeper look at who is betting on this turnaround, you should read Exploring Soluna Holdings, Inc. (SLNH) Investor Profile: Who's Buying and Why?

Growth Opportunities

You're looking past the current volatility, which is smart. Soluna Holdings, Inc. (SLNH) is defintely a story of transition right now, moving from a pure-play Bitcoin miner to a green data center and High-Performance Compute (HPC) host. The future growth isn't about the old business; it's about this pivot to AI and leveraging their unique energy model.

The core growth driver is their ability to co-locate data centers with renewable energy sources, essentially monetizing surplus power. This is a massive competitive advantage in a world where AI and HPC demand is skyrocketing, but so are power costs and environmental scrutiny. Their proprietary software, MaestroOS, helps them manage this complex energy arbitrage.

Here's the quick math on what analysts are projecting: while the consensus revenue for the full fiscal year 2025 is around $32.74 million, the real story is the expected acceleration. The base case for FY 2026 revenue is a huge leap, projected to land between $55 million and $148 million, which reflects the new projects coming online. Still, the company is not profitable yet; the 2025 EPS consensus is a net loss of -$2.40.

The near-term growth is tied directly to their strategic buildout and partnerships. They've already surpassed one gigawatt in clean computing projects, which is a significant operational milestone. This capacity is what will drive revenue, and they have the financing to back it up.

• Secured a scalable credit facility of up to $100 million from Generate Capital.
• Project Kati in Texas is their largest project to date, targeting 166 MW of clean computing capacity.
• Nearing completion on Project Dorothy 2, a key step in expanding current capacity.

The shift to hosting for AI and treasury-focused clients is already showing up in the financials. In Q3 2025, data center hosting became the main revenue generator, pulling in over $10.8 million. This diversification is crucial because it shields them from pure Bitcoin price volatility, and it's why their gross margin hit a healthy 28% in Q3 2025.

To be fair, they still have liquidity concerns, but the $60 million in cash and restricted cash reserves as of Q3 2025, plus the new credit facility, gives them the runway to finish these high-growth projects. The market is betting on the execution of this green data center strategy, which is why the revenue growth is forecast to be around 34.5% per year, significantly outpacing the broader US market. This is a high-risk, high-reward bet on infrastructure execution.

You can find a deeper dive into the company's current financial position and risks in the full post: Breaking Down Soluna Holdings, Inc. (SLNH) Financial Health: Key Insights for Investors.

The table below summarizes the key operational drivers for their future revenue:

Your next step is to monitor the commissioning dates for Project Dorothy 2 and Project Kati. Those construction milestones are the only thing that changes the revenue forecast.