UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2026

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to ____________

Commission File No. 001-42388

Datacentrex, Inc.

(Exact name of registrant as specified in its charter)

Nevada		85-3651036
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

470 W 200 N STE 18
Salt Lake City, UT		84103
(Address of principal executive offices)		(Zip Code)

(800) 403-6150

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of exchange on which registered
Common Stock, par value $0.001 per share		DTCX		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 14, 2026, there were 38,873,626 shares of the registrant’s common stock outstanding.

TABLE OF CONTENTS

		Page

PART I – FINANCIAL INFORMATION		4

Item 1.	Unaudited Financial Statements.	4

	Condensed Balance Sheets as of March 31, 2026 (Unaudited) and December 31, 2025	4

	Condensed Statements of Operations for the Three Months Ended March 31, 2026 and 2025 (unaudited)	5

	Condensed Statements of Changes in Stockholders’ Equity for the Three Months Ended March 31, 2026 and 2025 (unaudited)	6

	Condensed Statements of Cash Flows for the Three Months ended March 31, 2026 and 2025 (unaudited)	7

	Notes to the Condensed Financial Statements (unaudited)	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	20

Item 3.	Quantitative and Qualitative Disclosures about Market Risk.	31

Item 4.	Controls and Procedures.	31

PART II – OTHER INFORMATION		32

Item 1.	Legal Proceedings.	32

Item 1A.	Risk Factors.	32

Item 2.	Unregistered Sales of Equity Securities.	32

Item 3.	Defaults Upon Senior Securities.	32

Item 4.	Mine Safety Disclosures.	32

Item 5.	Other Information.	32

Item 6.	Exhibits.	32

SIGNATURES		33

CAUTIONARY NOTE ON Forward-Looking Statements

This Quarterly Report on Form 10-Q (this “Quarterly Report”) contains forward-looking statements within the meaning of the federal securities laws. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements preceded by, followed by or that include the words “may”, “could”, “would”, “should”, “believe”, “expect”, “anticipate”, “plan”, “estimate”, “target”, “project”, “intend”, “foresee” and similar expressions. These statements include, among others, statements regarding our expected business outlook, anticipated financial and operating results, our business strategy and means to implement the strategy, our objectives, the amount and timing of capital expenditures, the likelihood of our success in expanding our business, financing plans, budgets, working capital needs and sources of liquidity. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future.

Forward-looking statements are only predictions and are not guarantees of performance. These statements are based on our management’s beliefs and assumptions, which in turn are based on currently available information. Important assumptions relating to the forward-looking statements include, among others, assumptions regarding demand for our products, the expansion of product offerings geographically or through new marketing applications, the timing and cost of planned capital expenditures, competitive conditions and general economic conditions. These assumptions could prove inaccurate. Forward-looking statements also involve known and unknown risks and uncertainties, which could cause actual results to differ materially from those contained in any forward-looking statement. In addition, even if our actual results are consistent with the forward-looking statements contained in this Quarterly Report, those results may not be indicative of results or developments in subsequent periods. Many of these factors are beyond our ability to control or predict. Such factors include, but are not limited to, the following:

	●	our ability to successfully achieve our strategic initiatives, including our expectation that we will be able to secure additional miners;

	●	potential adverse reactions or changes to business relationships resulting from the completion of the merger (the “Merger”) with Dogehash Technologies Inc.;

	●	our inability to successfully operate as a combined business from the Merger;

	●	possible failure for us to realize certain anticipated benefits of the Merger, including with respect to future financial operating results;

	●	competition in our markets;

	●	our anticipated financial and operating results, including anticipated sources of revenues;

	●	regulatory investigations of, or actions commenced against, us or other companies in our industry;

	●	our investment strategy, including digital asset market volatility, cybersecurity and custody of assets, potential changes in laws or accounting standards relating to digital assets and regulatory developments affecting digital assets;

	●	volatility of our stock price;

	●	the effect of any cybersecurity incident; and

	●	general economic conditions.

Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the Securities and Exchange Commission (“SEC”), we are under no obligation to publicly update or revise any forward-looking statements, whether as a result of any new information, future events or otherwise. Investors, potential investors and other readers are urged to consider the above-mentioned factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results or performance.

PART I- FINANCIAL INFORMATION

Item 1. Financial Statements.

DATACENTREX, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	March 31, 2026 (Unaudited)			December 31, 2025

ASSETS
Current assets:
Cash and cash equivalents	$	42,474,352		$	38,919,486
Digital assets, at fair value		5,365,365			4,430,202
Other receivable		11,179,913			-
Prepaid expenses		715,443			468,817
Total current assets	$	59,735,073		$	43,818,505

Equipment, net		15,283,076			18,537,452
Capitalized software costs, net		171,219			264,193
Deposits for equipment		3,600,100			3,600,100
Other assets		621,660			621,660
Total assets	$	79,411,128		$	66,841,910

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Accounts payable and accrued expenses	$	259,817		$	594,658
Total current liabilities		259,817			594,658

Stockholders’ equity:

Preferred stock - Series A, $0.001 par value, $45.00 stated value, 1,000,000 shares authorized; 164,638 and 158,420 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively		164			158
Preferred stock - Series D, $0.001 par value, $4.34 stated value, 16,240 shares authorized; 16,239.812 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively		16			16
Preferred stock value		16			16

Common stock, $0.001 par value, 250,000,000 shares authorized; 34,885,530 and 30,375,530 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively		34,885			30,375
Treasury stock, at cost – 59,191 shares		(274,231	)		(274,231	)
Additional paid in capital		94,045,069			74,993,819
Accumulated deficit		(14,654,592	)		(8,502,885	)
Total stockholders’ equity		79,151,311			66,247,252

Total liabilities and stockholders’ equity	$	79,411,128		$	66,841,910

The accompanying notes are an integral part of these condensed consolidated financial statements.

DATACENTREX, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	March 31, 2026			March 31, 2025
	Three Months Ended
	March 31, 2026			March 31, 2025

Revenues	$	2,179,208		$	159,625

Cost of revenue		1,666,328			75,970

Gross profit		512,880			83,655

Operating Expenses:
General and administrative expenses		1,087,209			201,871
Depreciation and amortization		3,287,259			189,480
Stock based compensation		1,156,066			-
Total Operating Expenses		5,530,534			391,351

Loss From Operations		(5,017,654	)		(307,696	)

Other Income (Expense):
Net realized and unrealized losses, digital assets		(1,212,173	)		(899	)
Other income		6,467			-
Interest income, net		71,653			-
Total Other Income (Expense)		(1,134,053	)		(899	)

Net Loss Before Income Taxes		(6,151,707	)		(308,595	)

Provision for Income Taxes (Benefit)		-			-

Net Loss		(6,151,707	)		(308,595	)

Net Loss Per Common Share:
Basic	$	(0.20	)	$	-
Diluted	$	(0.20	)	$	-

Weighted Average Common Shares Outstanding:
Basic		30,425,641			-
Diluted		30,425,641			-

The accompanying notes are an integral part of these condensed consolidated financial statements.

DATACENTREX INC

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THREE MONTHS ENDED MARCH 31, 2026

(UNAUDITED)

	Shares		Shares Value		Shares		Shares Value		Units		Value		Units		Value		Shares		Shares Value		Treasury stock			Paid -In Capital			Accumulated Deficit			Members’ Equity
	Preferred stock								Class A-1				Class A-2
	Series A				Series D				Units				Units				Common Stock							Additional						Total
	Shares		Shares Value		Shares		Shares Value		Units		Value		Units		Value		Shares		Shares Value		Treasury stock			Paid -In Capital			Accumulated Deficit			Members’ Equity
BALANCE — December 31, 2025		158,420	$	158		16,240	$	16		-		-		-		-		30,375,530	$	30,375		(274,231	)	$	74,993,819		$	(8,502,885	)	$	66,247,252
Stock based compensation																									1,156,066						1,156,066
Preferred Series A issued for dividends		6,218		6																					(6	)
Issuance of common stock issued for public offering, net of issuance cost																		4,510,000		4,510					6,745,190						6,749,700
Issuance of prefunded warrants																									11,150,000						11,150,000
Net loss						-		-		-		-		-		-		-		-		-			-			(6,151,707	)		(6,151,707	)

BALANCE — March 31, 2026		164,638		164		16,240		16		-		-		-		-		34,885,530	$	34,885	$	(274,231	)	$	94,045,069		$	(14,654,592	)	$	79,151,311

FOR THREE MONTHS ENDED MARCH 31, 2025

(UNAUDITED)

	Preferred stock												Class A-2
	Series A				Series D				Class A-1 Units				Units				Common Stock						Additional					Total
	Shares		Shares Value		Shares		Shares Value		Units		Value		Units		Value		Shares		Shares Value		Treasury stock		Paid -In Capital		Accumulated Deficit			Members’ Equity
BALANCE — January 13, 2025		-		-		-	$	-		-				-		-		-	$	-		-	$	-	$	-		$	-
Balance		-		-		-	$	-		-				-		-		-	$	-		-	$	-	$	-		$	-

Issuance of Class A-1 Units										11,215,625		17,945,000																	17,945,000
Net loss		-		-		-		-								-		-		-		-		-		(308,595	)		(308,595	)

BALANCE — March 31, 2025		-		-		-				11,215,625		17,945,000		-		-		-			$	-	$	-	$	(308,595	)	$	17,636,405
Balance		-		-		-				11,215,625		17,945,000		-		-		-			$	-	$	-	$	(308,595	)	$	17,636,405

The accompanying notes are an integral part of these condensed consolidated financial statements.

DATACENTREX, INC

CONDENSED CONSOLIDATED STATEMENTS OF CASHFLOWS

(UNAUDITED)

	March 31, 2026			March 31, 2025
	Three Months Ended
	March 31, 2026			March 31, 2025

Cash flows from operating activities:
Net loss	$	(6,151,707	)	$	(308,595	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense		3,287,259			189,480
Stock based compensation		1,156,066			-
Digital asset mining revenue		(2,179,208	)		(159,625	)
Net unrealized and realized loss on digital assets		1,212,173			899
Impairment of capitalized software		60,092			-
Changes in operating assets and liabilities:
Prepaid expense		(246,627	)		(311,551	)
Other assets		-			(686,893	)
Other receivables		(29,913	)		-
Accounts payable and accrued expenses		(334,841	)		25,712
Net cash used in operating activities		(3,226,706	)		(1,250,573	)

Cash flows from investing activities:
Purchase of equipment		-			(17,290,001	)
Payments for deposits on equipment		-			(3,429,761	)
Proceeds from sale of digital assets		31,872			68,367
Net cash provided by (used in) investing activities		31,872			(20,651,395	)

Cash flows from financing activities:
Proceeds from public offering, net of issuance cost		6,749,700			-
Proceeds long term debt, net of discount		-			4,150,000
Proceeds from issuance of Class A-1 Units		-			17,945,000
Net cash provided by financing activities		6,749,700			22,095,000

Net increase in cash		3,554,866			193,032

Cash, beginning of period		38,919,486			-

Cash, end of period	$	42,474,352		$	193,032

Supplemental disclosures of cash flow information:
Cash paid during period for interest	$	-		$	25,712
Cash paid for taxes	$	-		$	-
Supplemental disclosures of non-cash financing activities:
Preferred Series A shares issued for dividends	$	6		$	-
Issuance of prefunded warrants	$	11,150,000		$	-

The accompanying notes are an integral part of these condensed consolidated financial statements.

Datacentrex, Inc.

Notes to the Unaudited Condensed Consolidated Financial Statements

March 31, 2026

Note 1 - Business Organization and Nature of Operations

Datacentrex (“DTCX” or the “Company”), formerly Thumzup Media Corporation (“Thumzup” or “TZUP”) was incorporated on October 27, 2020, under the laws of the State of Nevada, and its headquarters is located Salt Lake City, Utah. In December 2025, The Company completed a merger with Dogehash Technologies Inc (“Dogehash”) which was accounted for a reverse recapitalization. Thumzup’s primary business is software as a service provider dedicated to connecting businesses with consumers and allowing the business to incentivize consumers to post about their experience on social media through a proprietary mobile app. Dogehash is a digital asset mining company focused on mining Dogecoin (“DOGE”) and Litecoin (“LTC”). The Company was incorporated in the state of Nevada in April 2025. The Company acquired, through an asset purchase agreement effective July 25, 2025, US Data and Energy, LLC who commenced operations in January 2025 and is the historical operating entity included in these financial statements.

Note 2 – Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

These interim Condensed Consolidated Financial Statements (“interim financial statements”) of Datacentrex, Inc. and its subsidiaries (collectively, the “Company”) are unaudited and have been prepared in accordance with the rules of the Securities and Exchange Commission for interim statements. Certain information and footnote disclosures required by United States Generally Accepted Accounting Principles (“U.S. GAAP”) have been condensed or omitted as permitted by such rules, although the Company believes that the disclosures included are adequate to make the information presented not misleading. The interim financial statements included herein are expressed in United States dollars and in the opinion of management, include all adjustments (all of which are of a normal recurring nature) and disclosures necessary for a fair presentation. The results reported in these interim financial statements are not necessarily indicative of the results that may be reported for the entire year. These interim financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2025, included in the Company’s annual report Form 10-K. The year-end balance sheet data were derived from the audited financial statements. Unless otherwise noted, there have been no material changes to the footnotes from the audited consolidated financial statements contained in the Company’s annual report on Form 10-K. The Company’s financial statements have been prepared on a consolidated basis and as of March 31, 2026, and December 31, 2025, and for the three months ended March 31, 2026 and 2025 include the consolidated accounts of the Company. All intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The Company prepares its financial statements in accordance with U.S. GAAP, which requires management to use its judgment to make estimates and assumptions that affect the reported amounts of assets and liabilities and related disclosures at the date of the financial statements and the reported amounts of expenses during the reported period. These assumptions and estimates could have a material effect on the financial statements. Actual results may differ materially from those estimates. The Company’s management periodically reviews estimates on an ongoing basis based on information currently available, and changes in facts and circumstances may cause the Company to revise these estimates. Significant estimates include estimates used in the accounting for digital assets, revenue recognition, useful lives of equipment and the evaluation allowance related to deferred tax assets. Actual results may differ from these estimates.

Fair Value Measurement

As defined in GAAP, fair value represents the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As a result, fair value is a market-based approach that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering these assumptions, GAAP defines a three-tier value hierarchy that prioritizes the inputs used in the valuation methodologies in measuring fair value.

Level 1 - Quoted prices in active markets for identical assets or liabilities.

Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Cash and Cash Equivalents

Cash and cash equivalents include all cash on hand, demand deposits and short-term investments with original maturities of three months or less when purchased.

As of March 31, 2026, and December 31, 2025, the Company’s cash and cash equivalents consisted of $42,474,352 and $38,919,486, respectively. The Company maintains its cash in banks insured by the Federal Deposit Insurance Corporation (“FDIC”) in accounts that at times may be in excess of the federally insured limit of $250,000 per bank. The Company minimizes this risk by placing its cash deposits with major financial institutions. At March 31, 2026, and December 31, 2025, the uninsured balances amounted to $42,224,048 and $37,914,117, respectively. There is a risk the Company may lose uninsured balances over the FDIC insurance limit. The Company has not experienced any such losses.

Digital Assets

The Company holds digital assets classified as indefinite-lived intangible assets in accordance with Accounting Standard Update (“ASU”) 2023-08, “Accounting for and Disclosure of Crypto Assets.” These crypto assets are measured at fair value on a recurring basis. As part of its scope assessment, the Company evaluated all digital assets held during the three months ended March 31, 2026, and the year ended December 31, 2025, respectively, to determine whether they meet the criteria for recognition under ASU 2023-08. Based on this assessment, the Company concluded that its holdings of Bitcoin, Dogecoin and other Litecoins are in-scope digital assets. These assets are actively traded, held in custodial arrangements with enforceable rights, and used in operations or treasury activities. Further, the Company noted there are no digital assets that are not actively used, lack enforceable ownership rights, or are immaterial in value as of March 31, 2026 and December 31, 2025, respectively.

The Company determines the fair value of its in-scope digital assets using the market approach, primarily based on observable market prices in active exchanges. The valuation process considers relevant inputs such as exchange prices of similar digital assets, liquidity, and market depth. The fair value measurements are classified within Level 1 of the fair value hierarchy, as the inputs are quoted prices in active markets for identical assets. As of March 31, 2026 and December 31, 2025, the Company’s digital assets are recorded at a fair value of $5,365,365 and $4,430,202. During the three months ended March 31, 2026 and 2025, the Company recognized a net unrealized and realized loss of $1,212,173 and $899, respectively, in the condensed consolidated statements of operations and related to changes in fair value of digital assets. The Company continuously evaluates the fair value of its digital assets, considering market conditions and other factors that may impact valuation. There were no significant changes in the valuation techniques or inputs used during the reporting period.

Impairment of long-lived assets

Management reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. During the three months ended March 31, 2026 the Company recognized $60,092 of impairment associated with its capitalized software.

Prepaid Expenses and Other Assets

As of March 31, 2026 and December 31, 2025, the Company had $715,443 and $468,817, respectively, of prepaid expenses which primarily consisted of premiums on insurance policies and prepaid power charges associated with its locations. As of March 31, 2026 and December 31, 2025, the Company had $621,660 of other assets which primarily consisted of hosting deposits for its colocation locations. See Note 7 for further details on the Company’s colocation arrangements.

Equipment

Equipment, which consists of mining and computer equipment, is recorded at cost and depreciated using the straight-line method over the estimated useful lives. Ordinary repair and maintenance costs are included in general and administrative expenses on our statement of operations. However, expenditures for additions or improvements that significantly extend the useful life of the asset are capitalized in the period incurred. At the time assets are sold or disposed of, the cost and accumulated depreciation are removed from their respective accounts and the related gains or losses are reflected in the condensed consolidated statements of operations in gains from sales of property and equipment, net. The estimated useful life for mining equipment and computer equipment is 2 two and three years, respectively. The Company evaluates the appropriateness of remaining depreciable lives assigned to computer equipment at the end of each fiscal year.

Capitalized Software Costs

The Company capitalizes certain costs related to the development and enhancement of the Thumzup platform. In accordance with authoritative guidance, including ASC 350-40, we began to capitalize these costs when the technological feasibility was established and preliminary development efforts were successfully completed, management has authorized and committed project funding, and it was probable that the project would be completed and the software would be used as intended. Such costs are amortized when placed in service, on a straight-line basis over the estimated useful life of the related asset, generally estimated to be three years. Costs incurred prior to meeting these criteria together with costs incurred for training and maintenance are expensed as incurred and recorded in product development expenses on our condensed consolidated statements of operations. Costs incurred for enhancements that were expected to result in additional features or functionality that would generate additional revenue are capitalized and expensed over the estimated useful life of the enhancements, generally three years. The Company does not capitalize any testing or maintenance costs. The accounting for these capitalized software costs requires the Company to make significant judgments, assumptions and estimates related to the timing and amount of recognized capitalized software development costs. As of March 31, 2026, the Company determined impairment totaling $60,092 of its capitalized software costs was warranted.

Revenue Recognition

The Company engages in digital asset mining utilizing the Scrypt hashing algorithm which falls outside of ASC 606, Revenue from Contracts with Customers.

The Company engages in the mining of digital assets, primarily utilizing the Scrypt hashing algorithm, such as Litecoin (LTC) and Dogecoin (DOGE). Scrypt is a cryptographic proof-of-work algorithm designed to be computationally and memory intensive, offering an alternative to the SHA-256 algorithm used in traditional Bitcoin mining.

Scrypt mining involves solving complex mathematical problems that require both processing power and memory bandwidth. This algorithm supports the security and integrity of blockchain networks by making it economically impractical to manipulate transaction data. The Company utilizes specialized mining equipment optimized for the Scrypt algorithm to maximize efficiency and output. The Company participates in merged mining of Litecoin and Dogecoin, leveraging the Scrypt algorithm to simultaneously validate blocks on both blockchain networks.

Under Scrypt mining, there is no contract with a customer as the mining rewards are granted by the decentralized blockchain protocol and not a party entering into a contractual agreement. Therefore, Revenue is recognized when control of the mined digital assets is obtained and transferred to a digital wallet, measured at the fair market value of the assets at the time of receipt. Fair value is based on a principal or most advantageous market, using observable market prices from reputable exchanges.

Cost of Revenue

The Company’s cost of revenue consists primarily of direct production costs related to mining operations, including electricity costs, and other relevant costs paid to our hosting facilities in accordance with the colocation agreement.

Sales and Marketing

Sales and marketing expenses primarily include costs related to advertising and marketing programs. Sales and marketing costs are expensed as incurred and totaled $2,157 and $1,424 for three months ended March 31, 2026, and 2025, respectively, and are included in general and administrative expenses on the condensed consolidated statement of operations.

Income Taxes

The Company accounts for income taxes under the asset and liability method, which requires that deferred income taxes be provided for temporary differences between the tax basis of the Company’s assets and liabilities and their financial statement carrying amount. In addition, deferred tax assets are recorded for the future benefit of utilizing net operating losses and research and development tax credit carry forwards. A valuation allowance is provided against deferred tax assets unless it is more likely than not that they will be realized. Significant judgment is required in determining any valuation allowance recorded against deferred tax assets. In assessing the need for a valuation allowance, the Company considers all available evidence, including past operating results, estimates of future taxable income and the feasibility of tax planning strategies.

In the event that the Company changes its determination as to the amount of deferred tax assets that is more likely than not to be realized, the Company will adjust its valuation allowance with a corresponding impact to the provision for income taxes in the period in which such determination is made. The Company follows the authoritative guidance regarding uncertain tax positions. This guidance requires that realization of an uncertain income tax position must be more likely than not (i.e., greater than 50% likelihood of receiving a benefit) before it can be recognized in the financial statements. The guidance further prescribes the benefit to be realized assumes a review by tax authorities having all relevant information and applying current conventions.

Segment Reporting

Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (the “CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Company’s Chief Executive Officer is the Company’s CODM. The CODM reviews financial information for purposes of making operating decisions, allocating resources, and evaluating financial performance. While the Company does have revenue from multiple products, no measures of profitability by product are available, so discrete financial information is not available for each such component. As such, the Company has determined that it operates as one operating segment and one reportable segment.

Share-based Compensation

The Company maintains its 2024 Equity Incentive Plan 2025 Equity Incentive Plan and 2025 Omnibus Equity Incentive plan (collectively, the “Equity Plans”), under which, the Company’s employees, officers, directors, and other eligible participants may be and have been awarded various types of share-based compensation, including options to purchase shares of the Company’s common stock, restricted stock units (“RSUs”), and other stock-based awards. Additionally, under the Equity Plans, awards may be and have been granted that are subject to the achievement of one or more performance measures established by the Company’s board of directors or a duly authorized committee thereof.

For options and other stock-based awards, the share-based compensation expense is based on the fair value of the awards on the date of grant, as estimated using the Black-Scholes valuation model. For restricted stock units, the share-based compensation expense is based on the fair value of the Company’s common stock on the date of grant. The fair value of liability-classified awards (e.g., the other stock-based awards and cash-settled restricted stock units) is remeasured at each reporting date.

The Company recognizes share-based compensation expense for service-conditioned awards granted under the Equity Plans on a straight-line basis over the requisite service period (generally, the vesting period for service-conditioned awards under the Equity Plans).

See Note 8, Stock Options, to the financial statements for further information regarding the Equity Plans, related share-based compensation expense, and assumptions used in determining fair value.

Treasury Stock

On February 26, 2025, the Thumzup board of directors approved a share repurchase program authorizing the Company to purchase up to an aggregate of $1 million of common stock. Subject to applicable rules and regulations, the shares may be purchased from time to time in the open market or in privately negotiated transactions. Such purchases will be at times and in amounts as deemed appropriate, based on factors such as market conditions, legal requirements and other business considerations.

On September 23, 2025, the Thumzup board of directors approved a share repurchase program authorizing the Company to purchase up to an aggregate of $10 million of common stock. Subject to applicable rules and regulations, the shares may be purchased from time to time in the open market. Such purchases will be at times and in amounts as deemed appropriate, based on factors such as market conditions, cash reserves, cash flows and other business considerations.

As of March 31, 2026 and December 31, 2025, the Company had $274,231 in treasury stock, respectively.

Preferred Stock

The Company is authorized to issue 25,000,000 shares of preferred stock, par value $0.001 per share. At March 31, 2026 and December 31, 2025, 180,878 and 174,630 shares were issued and outstanding, respectively.

Common Stock

The Company is authorized to issue 250,000,000 shares of common stock, par value $0.001 per share. At March 31, 2026 and December 31, 2025, 34,885,530 and 30,375,530 shares were issued and outstanding, respectively.

Member Units

During the three months ending March 31, 2025, the Company issued 11,215,625 Class A -1 units for cash proceeds of $17,945,000. There were no Member units outstanding as of March 31, 2026.

Net Loss Per Common Share

The Company computes loss per share under ASC subtopic 260-10, Earnings Per Share. Net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the year. Diluted earnings per share, if presented, would include the dilution that would occur upon the exercise or conversion of all potentially dilutive securities into common stock using the “treasury stock” and/or “if converted” methods, as applicable.

The computation of basic and diluted loss per share, for the three months ended March 31, 2026 and 2025, excludes potentially dilutive securities when their inclusion would be anti-dilutive, or if their exercise prices were greater than the average market price of the common stock during the period.

Potentially dilutive securities excluded from the computation of basic and diluted net loss per share are as follows:

	March 31,		March 31,
	2026		2025
Common shares issuable upon exercise of options		1,213,458		-
Common shares issuable upon exercise of warrants		455,888		-
Common shares issuable upon conversion of preferred stock		20,024,975		-
Total potentially dilutive shares		21,694,321		-

Recent Accounting Pronouncements Not Yet Adopted

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued Accounting Standards Update No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”). ASU 2024-03 requires specified information about certain costs and expenses be disclosed in the notes to the financial statements, including the expense on the face of the income statement in which they are disclosed, in addition to a qualitative description of remaining amounts not separately disaggregated. Entities will also be required to disclose their definition of “selling expenses” and the total amount in each annual period. The standard is effective for the Company for annual periods beginning December 15, 2026, and for interim periods beginning December 15, 2027, with updates applied either prospectively or retrospectively. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on its disclosures.

There are other various updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

Note 3 – Digital Assets

The following table presents the Company’s significant digital assets holdings as of March 31, 2026:

	Quantity		Cost Basis		Fair Value
Dogecoin		21,691,484	$	2,786,002	$	2,000,611
Bitcoin		46		3,861,519		3,136,143
Litecoins		3395		267,601		182,991
Other		25,195,554		45,702		45,620
Total			$	6,960,824	$	5,365,365

The following table presents the Company’s significant digital assets holdings as of December 31, 2025:

	Quantity		Cost Basis		Fair Value
Dogecoin		20,974,425	$	4,217,383	$	2,460,255
Bitcoin		19.11		2,001,246		1,671,955
Litecoins		3,198		279,023		245,508
Other		191,738,575		56,973		52,484
Total			$	6,554,625	$	4,430,202

The following table summarizes the Company’s digital asset activity for the three months indicated:

Schedule of Digital Assets

	Three Months Ended March 31
	2026
Digital assets, December 31, 2025	$	4,430,202
Digital asset mining revenue
Dogecoin		98,194
Bitcoin		2,064,897
Litecoins		15,930
Other litecoins		187
Digital asset sales		(31,872	)
Net unrealized and realized loss, digital assets		(1,212,173	)
Digital assets, March 31, 2026	$	5,365,365

The following table presents a roll-forward of Bitcoin (“BTC”) for the three months ended March 31, 2026, based on the fair value model under ASU 2023-08:

Schedule of Digital Asset Roll Forward

	Fair Value
BTC as of December 31, 2025	$	1,671,955
Receipt of BTC from mining services		2,064,897
Proceeds from sale of BTC		(14,964	)
Change in fair value of BTC		(585,745	)
BTC as of March 31, 2026	$	3,136,143

The following table presents a roll-forward of Dogecoin for the year ended December 31, 2025, based on the fair value model under ASU 2023-08:

Schedule of Digital Asset Roll Forward

	Fair Value
Dogecoin as of December 31, 2025	$	2,460,255
Receipt of Dogecoin from mining services		98,194
Proceeds from sale of Dogecoin		(15,750	)
Change in fair value of Dogecoin		(542,058	)
Dogecoin as of March 31, 2026	$	2,000,611

Note 4 – Deposits on Equipment

The deposits for equipment represented advance payments for purchases of miner, high performance computing equipment and other equipment used in digital asset mining activity at the Colocation site. The Company initially recognizes deposits for equipment when cash is advanced to our suppliers. Subsequently, the Company derecognizes and reclassifies deposits for mining equipment to mining equipment when control is transferred to and obtained by the Company. At March 31, 2026 and December 31, 2025, the Company had deposits and advance payments of approximately $3,600,100, respectively, for mining equipment.

Note 5 – Equipment

As of March 31, 2026 and December 31, 2025, equipment, net consisted of the following:

	March 31,			December 31,
	2026			2025
Mining equipment	$	26,020,439		$	26,020,439
Computer equipment		28,295			28,295
Total		26,048,734			26,048,734
Less: accumulated depreciation		(10,765,658	)		(7,511,282	)
Equipment, net	$	15,283,076		$	18,537,452

Depreciation expense for the three months ended March 31, 2026 and 2025 totaled $3,254,376 and $189,480, respectively, and is included in operating expenses on the condensed consolidated statement of operations.

Note 6 – Capitalized Software

As of March 31, 2026 and December 31, 2025, capitalized software consisted of the following:

Schedule of Capitalized Software Costs

	March 31,			December 31,
	2026			2025
Capitalized software cost	$	397,739		$	457,830
Less: accumulated amortization		(226,520	)		(193,637	)
Capitalized software, net	$	171,219		$	264,193

Amortization expense for the three months ended March 31, 2026 and 2025 totaled $32,883 and $0, respectively, and is included in operating expenses on the condensed consolidated statement of operations.

Note 7 – Contingencies

Legal

From time to time, the Company may be involved in various litigation matters and disputes arising in the ordinary course of business. The Company reviews its lawsuits, regulatory investigations and other legal proceedings on an ongoing basis. The Company records liabilities for contingencies, including legal costs, when it is probable that a liability has been incurred before the balance sheet date and the amount can be reasonably estimated.

Various legislative and executive bodies in the United States and in other countries may, in the future, adopt laws, regulations or guidance, or take other actions that could severely impact the permissibility of digital assets generally and the technology behind them or the means of transacting in or transferring them. It is difficult to predict how or whether regulatory agencies may apply existing or new regulation with respect to this technology and its applications.

Colocation Agreement

The Company utilizes third-party data center facilities to support its digital asset mining operations. Specifically, the Company has entered into a colocation and hosting services agreement with an independent data center provider for the ongoing provision of rack space, electrical power capacity, network connectivity, and cooling infrastructure required to operate the Company’s mining hardware. These arrangements do not convey to the Company the right to control the use of any identified physical asset within the data center, and the service provider retains substantive substitution rights of the assets at all times. Accordingly, consistent with the guidance in ASC 842, the Company has concluded that the arrangement represents a service contract and does not contain a lease, as the Company does not obtain control of an identified asset during the contract term.

The colocation and hosting contracts generally include variable charges based on power consumption and other usage-based elements. Under ASC 842, the Company recognizes expense for such service arrangements as incurred, and no right-of-use (“ROU”) asset or lease liability is recorded on the condensed consolidated balance sheet because the contract is outside the scope of lease accounting.

For the three months ended March 31, 2026, and 2025, the Company incurred $1,666,328 and $75,970, respectively, in colocation and hosting-related service expenses, which are included within cost of revenues in the accompanying condensed consolidated statements of operations.

Note 8 – Stock Awards

Thumzup’s stockholders approved Thumzup’s 2024 Equity Incentive Plan in May 2024, amending it in July 2024 to increase the number of shares reserved for issuance thereunder to 2,000,000, and approved Thumzup’s 2025 Equity Incentive Plan in April 2025 with an additional 2,000,000 shares reserved for issuance thereunder. In December 2025, the Company’s stockholders approved the 2025 Omnibus Equity Incentive Plan. The number of shares reserved for issuance under the plan are 7,000,000. The equity plans approved by the stockholder are collectively referred to as the “Plans”.

The Plans provide for the grant of incentive stock options to Thumzup’s employees, including officers, consultants and directors, and its subsidiaries’ employees, including officers, consultants and directors and for the grant of stock options, stock bonus awards, restricted stock awards, performance stock awards and other forms of stock compensation. The Plans also provide that the grant of performance stock awards may be paid out in cash as determined by the committee administering the Plans.

Option valuation models require the input of highly subjective assumptions. The fair value of stock-based payment awards was estimated using the Black-Scholes option pricing model with a volatility figure derived from historical data. The Company accounts for the expected life of options based on the contractual life of the options.

As of March 31, 2026, the Company had 5,187,575 shares of common stock available for future issuance under the Plans.

A summary of the stock option activity for the three months ended March 31, 2026, is as follows:

Schedule of Stock Option Activity

	Shares			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at December 31, 2025		1,173,458		$	5.07		8.89	$	-
Granted		60,000			2.00		9.90	$	9,000
Exercised		-			-		-	$	-
Forfeited		(20,000	)		5.00		8.80	$	-
Cancelled/Exchanged		-			-		-	$	-
Outstanding at March 31, 2026		1,213,458		$	4.92		8.70	$	9,000
Exercisable at March 31, 2026		947,833		$	4.90		8.73	$	9,000

A summary of the stock options outstanding at March 31, 2026, is as follows:

Exercise Price		Options Outstanding		Weighted Average Remaining Life		Options Exercisable
$	5.00		959,708		8.59		694,083
	5.47		133,750		8.59		133,750
	5.42		60,000		9.51		60,000
	2.00		60,000		9.90		60,000
			1,213,458		8.73		947,833

The aggregate intrinsic value of outstanding stock options was $9,000, based on options with an exercise price less than the Company’s stock price of $2.15 as of March 31, 2026, which would have been received by the option holders had those option holders exercised their options as of that date.

The fair value of all options that vested during the three months ended March 31, 2026 was $242,749. Unrecognized compensation expense was $1,273,418 as of March 31, 2026.

In January 2026, 100,000 RSUs were granted to advisors to the Company. The RSUs will vest 50% immediately and 50% in July 2026.

In March 2026, 100,000 RSUs were granted to advisors to the Company. The RSUs vest immediately.

The Company determined the fair value of all the RSUs issued during the three months ended March 31, 2026 to be $373,750 based on the price of the most recent sale of common stock prior to each grant date for those RSU’s granted prior to the Listing Date, or the quoted market value on the date of issuance of the RSU’s granted after the Listing Date. As of March 31, 2026, there was unamortized stock-based compensation of approximately $4,860,715 which the Company expects to recognize over approximately 2.25 years.

The activity related to RSUs is summarized as follows:

Schedule of Activity Related to RSUs

Restricted Stock Units Issued	RSUs Granted		Weighted-Average Exercise Price
Restricted Stock Units at December 31, 2025		3,251,789		-
Granted		200,000	$	1.87
Cancelled		-		-
Forfeited		-		-
Restricted stock units at March 31, 2026		3,451,789

Vesting Activity of Restricted Stock Units	RSUs			Weighted-Average Exercise Price
Unvested at December 31, 2025		1,647,850			-
Granted		200,000		$	1.87
Cancelled		-			-
Vested		(150,000	)	$	1.95
Unvested at March 31, 2026		1,697,850

Note 9 – Warrants

A summary of the warrant activity for the three months ended March 31, 2026, is as follows:

	Shares		Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at December 31, 2025		455,888	$	9.09		4.53	$	-
Granted		5,575,000		0.01		-	$	11,930,500
Exercised		-		-		-		-
Cancelled/Exchanged		-		-		-		-
Outstanding at March 31, 2026		6,030,888	$	0.70		.32	$	11,930,500
Exercisable at March 31, 2026		6,030,888	$	0.70		.32	$	11,930,500

A summary of the warrants outstanding at March 31, 2026, is as follows:

Exercise Price		Warrants Outstanding		Weighted Average Remaining Life		Warrants Exercisable
$	2.00		5,575,000		-		5,575,000
	6.00		65,000		4.26		65,000
	6.25		40,888		3.59		40,888
	10.00		350,000		4.37		350,000
			6,030,888		0.32		6,030,888

The aggregate intrinsic value of outstanding stock warrants was $11,930,500, based on warrants with an exercise price less than the Company’s stock price of $2.15 as of March 31, 2026, which would have been received by the warrant holders had those holders exercised the warrants as of that date.

Note 10- Secured Promissory Notes

In February 2025, the Company entered into a Secured Promissory note for a principal sum of $2,150,000, bearing interest of 10% and matured on August 21, 2025. As of December 31, 2025, the note was repaid in full.

In March 2025, the Company entered into a Secured Promissory note for a principal sum of $2,000,000, bearing interest of 10% and matured on April 26, 2025. As of December 31, 2025, the note was repaid in full.

Note 11 – Stockholder’s Equity

Public Offering

On March 26, 2026, the Company entered into a placement agency with Dominari Securities LLC, pursuant to which we sold directly to investors, in a best efforts offering, an aggregate of (i) 4,510,000 shares of common stock at $2.00 per share and (ii) pre-funded warrants to purchase up to an aggregate of 5,575,000 shares of common stock at $1.99 per pre-funded warrant. The securities were offered and sold by the Company pursuant to our effective registration statement on Form S-3 (File No. 333-286951). The closing of the offering occurred on March 31, 2026 and the gross proceeds from the offering were approximately $20.2 million, before deducting placement agent fees and expenses and estimated offering expenses totaling $2,270,300. As of March 31, 2026, the Company did not receive the funds associated with the pre-funded warrants. Since the transaction was closed as of March 31, 2026 and the investors had legal enforceable rights to the warrants, a receivable of $11,150,000 was recorded in the condensed consolidated balance sheet. The funds associated with the warrants were received in full as of April 2, 2026.

Issuance of December 15, 2025 Series A Preferred Dividends

SEC Form 10-Q filed by Datacentrex Inc.