Mr. Frank Holmes reports

HIVE DIGITAL PROVIDES UPDATE ON GPU INFRASTRUCTURE FOR AI AND HPC

Hive Digital Technologies Ltd. has provided an update on its HPC and AI infrastructure projects.

The company is converting its 38,000 Nvidia data centre GPU cards, previously used to mine ethereum and other cryptocurrencies, into an on-demand GPU cloud service.

Hive Digital president and chief executive officer Aydin Kilic stated, "We're on track to have 3,200 GPUs, mostly powerful Nvidia A40s, up and running in the AI/HPC space by the end of October."

Mr. Kilic continued: "GPU cloud is far more complex than mining bitcoin with ASICs. It took us a few months to get the right hardware architecture in place, and we've had a breakthrough in the last week. Our GPU server utilization rate has gone from 40 to 50 per cent during our test phase to over 80 per cent last week as our commercialization ramps up, allowing those GPUs to almost double their daily cash flow per server. The team has done an amazing job, and we're rapidly learning and advancing this business. We're quite bullish on the GPU cloud market, which we see as one of those rare opportunities which only come along every few decades. The demand is growing quickly."

Hive Digital's HPC and AI business is currently generating 15 times more revenue than bitcoin on a per-megawatt basis, and demand for GPU compute is growing rapidly.

Hive Digital executive chairman Frank Holmes stated: "A recent report by Goldman Sachs suggests huge demand. Fortune Business Insights has predicted that the GPU as a service market in North America will grow at a compounded annual growth rate of 34 per cent until 2030. This is a blue-sky opportunity, thanks to remarkable demand from AI projects. For example, we think large language models, the tech behind ChatGPT, is just getting started. We think there's a use for them in almost every company, and these things require a lot of GPU power to build and run."

Hive Digital leadership believes that the GPU cloud will be an excellent complement to the company's bitcoin mining business. Revenue from its GPU infrastructure is growing quickly and should offer a stable source of cash flow to the business once it reaches scale. The company is initially targeting two of the largest markets in the world: North America (through Canada) and Europe (through Sweden).

Mr. Holmes said: "Our foundation in HPC and AI infrastructure is now secured in both North America and the Europe. Our GPUs are installed in powerful new SuperMicro servers in Tier 3 data centres. We realized a successful beta test earlier this year with 400 GPUs, and our goal for the end of the year is 4,800 GPUs active by Dec. 31."

Mr. Holmes continued: "When we made the $66-million GPU purchase from Nvidia in 2021, we were planning beyond the ethereum merge. We strategically bought multiuse Nvidia cards instead of ethereum-specific ones, which are slightly more efficient. Why? Because these GPUs are hundreds, even thousands, of times faster and more efficient than CPUs for certain workloads, including these new AI technologies. We're excited to build this business."

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