At commencement, a sales-type GPU lessor takes the server off the books and leaves a net investment. BIRD has done that in a 10-Q. ALP has said it in a press release.
02
Article architecture · 1–5
From the entry to the two cases
01TL;DR Owned-asset anchor versus a sublease neighbor
02Skeleton Sales-type, operating, and 606 do not share an ARR
03BIRD Purchased Blackwell, sales-type NIL, one customer
04ALP 504 B200s leased in from Buzz, then leased out
05Revenue line What each book may print as income
03
Chapter 01
The sample
Who books an identified NVIDIA GPU server as a sales-type or finance lease.
1.1 Object, anchor, and neighbor
1.2 Two findings, two evidence grades
04
Chapter 1 · Object
Same family, different P&L
Sales-type pulls a financed sale to day one. Operating spreads rent across the term. Neither is a 606 cloud.
BIRD, formerly Allbirds, is the clean owned-asset sample. ALP, formerly Portage / AlphaTON, is the narrative neighbor: Buzz lease-in / lease-out, classification in a monthly PR.
05
Chapter 1 · Findings
Two findings, two grades
$2.758MBIRD Q2 revenue = cost. Not ×4
$2.664MBIRD NIL at 30 June. Interest ~$0.1M
504ALP B200s. TCV $32.2M. Buzz in at $29.6M
$465kALP July finance income. A company monthly.
BIRD card count is unfiled. ALP’s audited FY2026 revenue is $97k and excludes ALPHA-01.
06
Chapter 02
Pin the entry first
A dedicated GPU contract enters 842 or 606, then operating or sales-type.
2.1 Three standards, three P&Ls
2.2 BIRD commencement, four steps
2.3 The misread on each book
07
Chapter 2 · 2.1 Three books
Three engines, not one ARR
Sales-type
PPE leaves. NIL stays. Day-one revenue can equal cost. Then interest. Do not annualize.
Operating
GPU stays in PPE and depreciates. Straight-line lease revenue. Rent can be a run-rate.
ASC 606
No identified asset, or a substitution right remains. Deferred revenue and RPO. Not rent.
BIRD and BRUN are both lessors. Comparing their ARR sideways lies. Residual on a sales-type goes into the NIL; on an operating lease it stays with the lessor.
08
Chapter 2 · 2.2 Commencement · Q2'26 10-Q
Buy, swap, collect, stop
01 Buy
Cash out to PPE. Purchase of PPE $2.758M.
02 Commence
PPE moves to NIL. Revenue $2.758M equals cost. Gross profit ~0.
03 Collect
Cash splits. Principal reduces the NIL. The rest is interest.
Continuing GPU PPE is gone. The $2.758M is the pulse, not a quarterly run-rate. SG&A can be an order of magnitude larger than the interest that follows.
09
Chapter 2 · 2.3 Same desk
Each book has its own lie
Sales-type
Machine is off the lessor’s PPE. Prepay often sits in the NIL. Lie: annualize day-one revenue.
Operating
Machine stays on the lessor’s PPE. Lie: treat TCV as RPO.
606
Machine usually stays with the operator. Lie: call a dedicated cluster 842.
10
Chapter 03
Smartbird
A footwear shell that bought Blackwell and booked one sales-type lease.
3.1 The dates that carry the pivot
3.2 One continuing revenue line, and the facility
3.3 The QumulusAI lease
3.4 The statements, and what the interest is not
11
Chapter 3 · 3.1 The dates
Dates open the pivot
Second Avenue
$50M secured revolver. Repaid when the shoes close.
Footwear APA
Signed near $39.0M. Escrow $3.0M.
Notes and the lease
Blackwell and QumulusAI. First notes $3.25M.
Chardan ATM
Opened with a cap of $50M.
Formation in 2015, the 2021 IPO, and the footwear revenue years sit behind this line.
12
Chapter 3 · 3.1 The dates
June closes the shell
Second draw
Additional notes, $5.0M. Issued face is then $8.25M.
Footwear closes
Cash about $40.7M. Second Avenue repaid, about $19.7M.
Cap, name, facility
ATM cap about $98.1M. Smartbird. Facility to $100M.
Chief executive
Nadia Carlsten becomes CEO. Joe Vernachio resigns.
The 20 April 8-K summarizes the April cluster. The footwear close and the GPU lease are different checks.
13
Chapter 3 · 3.1 Management
Power changed. The lease did not
10×Class B votes versus Class A
12%Facility coupon. OID 5%. Two-year tranches
$700kCarlsten salary. CFO stays at $450k
29 JulAuditor replaced. Transition risk up
Facility investors also have a 24-month ≥55% co-invest and a COO appointment right. The dilution slope can beat the operating-proof slope. That is the base and bear case, not “is there a GPU.”
14
Chapter 3 · 3.2 Where the business is
One lease is the whole line
Footwear
Divested 9 June. Gain about $21.6M. Discontinued.
Electronics
One NewBird → QumulusAI sales-type. A miniature lessor.
GPUaaS
Stockholder-letter vision. No cloud revenue line. No owned hall.
Access
Cash ~$37.4M. Undrawn $91.75M is an option. Capacity ≠ cash.
Smartbird holds the card. The QumulusAI subsidiary is the lessee and, on the company’s telling, the operator.
15
Chapter 3 · 3.2 Capital toolbox
Undrawn is an option
Revolver
Second Avenue $50M. Paid off 9 June, about $19.7M. Extinguishment loss $3.2M.
Convert
Cap $100M. Issued $8.25M. Undrawn $91.75M is the investors’ option.
ATM
Cap up to about $98.1M. H1 net used about $15.4M.
Dividend
$0.31 / share, about $3.6M, from the shoe proceeds.
Disclosed net cash on the two draws is about $7.3M. Financing-line proceeds are $7.838M. Fair value at 30 June is $8.187M.
16
Chapter 3 · 3.2 How to read the facility
Priced down, secured up
93% / 85%Lowest-VWAP alternate. 85% only in default
4.99%Blocker. 9.99% on 61 days’ notice
$91.75MUndrawn. Solely the holders’ option
2 yrNote maturity. The lease runs 36 months
Face $8.25M. Disclosed net cash about $7.3M. Coupon 12%, in stock or in cash at the company’s option. OID 5%. Issuance costs about $0.5M, expensed at once. Senior lien on all assets, including the AI infrastructure. A lower price issues more shares for the same principal. The filings do not show that loop has been run.
17
Chapter 3 · 3.3 What was leased · Note 11
$2.8M. Count unfiled
$2.758MPurchase of PPE. Current-gen Blackwell
36 moNoncancelable. Lessee: a QumulusAI subsidiary
$0.1MThen $0.2M / month. Purchase option ~$0.1M
UNFILEDSKU, count, supplier, hall, legal name
April marketing said about $2.75M over three years. Total payments including the option are about $3.7M. Do not invent B200 or B300 counts, megawatts, or tokens per second.
100% of continuing revenue. Consideration ~$2.75–3.7M. Term 36 months. No large prepay stressed. Sales-type. Subsidiary legal name, guaranty, SLA, and hall are unfiled.
vs
A large BRUN contract
Thinking Machines path $472M. Other singles $200M+. Often 36–48 months. A construction prepay near 25% is common. The body is an operating lease. Not the same shape.
Any collection problem punches through the AI narrative. BIRD’s own office ROU of $2.502M is a lessee cost, unrelated to the GPU lessor position.
H1 revenue is the same $2,758. Continuing net loss is $(12,778) in the quarter and $(18,869) in the half. The $1,458 interest-expense line is not the cash coupon. Do not ×4 the revenue.
21
Chapter 3 · 3.4 Unearned interest
$832k is not profit
$832kRemaining interest. 3,496 minus 2,664
~31%Undiscounted margin. Not an annual rate
~17%Reconstructed nominal yield
~19%Reconstructed effective yield
The 10-Q does not disclose the implicit rate. A level annuity near 18.6% is the wrong contract. Payments are about $0.1M a month, then about $0.2M, and fewer than 36 months remained on 30 June.
22
Chapter 3 · 3.4 · $ thousands
Not the cash coupon
SG&A10,695
Interest expense1,458
Unearned, all832
Note 5 coupon~100
Cash interest paid in the half is zero. A cash hold-to-maturity on about $7.3M of proceeds is roughly 19% nominal, in the same band as the lease yield. Conversion is the path the note is built for. Do not subtract 1,458 from 79 and call the gap the spread.
Cash and restricted cash move from $27,552 to $38,588. Shoes +$38.2M. Discontinued financing −$25.2M. Continuing financing +$23.4M. GPUs −$2.8M. Operating cash −$7.3M continuing and −$15.9M discontinued. The dividend, about $3.6M, was declared after quarter-end. Further draws are the holders’ option.
24
Chapter 3 · 3.4 Contract arithmetic only
1.32× is not a card count
BIRD 3.7 / 2.8≈ 1.32×
ALP 32.2 / 29.6≈ 1.09×
Bars are the excess over 1.00×, not dollars. BIRD day-one revenue / cost is ~1.0× and is not profit. Q2 interest / NIL is not a full-quarter run-rate. SG&A / NIL is $10.7M / $2.7M. GPU count stays unfiled. BRUN’s $472M path is an anchor, not an isomorphism. Market cap ~$22–30M is a secondary source only.
25
Chapter 04
Alpha Compute
A finance-lease neighbor that leases the cards in, then leases them out.
Most executives are independent contractors, with cash plus TON-token bonuses. That is a light shell, not BRUN’s operating team. Villani is also CIO. Mitin speaks on ALPHA-01.
Intermediary. Calls the outbound side finance or sales-type. Spread, not ownership.
Unnamed lab
Downstream lessee. Exclusive access to an identified cluster. Canada, 100% hydro.
Gap
Colo operator unfiled. Who runs the cluster is fuzzier than BIRD’s “lessee operates.”
TCV $32,200,000. Management ARR $16,100,000. Go-live May 2026. Marketed prepay $7.5M. Actual May prepay on the July memo: $6,445,958. Both terms are about 24 months.
28
Chapter 4 · 4.2 Classification
July speaks. The 20-F does not
Audited 20-F
FYE 31 March 2026. IFRS 15, stand-ready, over time. Revenue $97k is March compute, before ALPHA-01. No NIL line. No finance-versus-operating checklist.
vs
19 August PR
Identified GPU cluster. Lease, not a service. If finance or sales-type, collections split into NIL recovery and finance income. Not filed as a 6-K.
July, unaudited: finance income $465,076, lease interest expense $270,318, cash in $1,084,074, cash out $1,250,928, net cash $(166,854). Do not ×12 the income. Interest expense fits a lessee-sublessor. The $6.45M prepay is described as a two-year monthly credit.
29
Chapter 4 · 4.2 Statutory book · Form 20-F
IFRS 16 is the book
IFRS 16
Two lessor classes: finance and operating. No sales-type class. A sublease is classified on the right-of-use asset, IFRS 16.B58, not on the GPU. This is the filed framework.
vs
The August words
The monthly names ASC 842 beside IFRS 16 and says finance or sales-type. ASC 842 has three lessor classes and classifies a sublease on the GPU. BIRD’s 10-Q is that book.
No U.S. GAAP primary statements. The monthly was not a 6-K. FY2026 policy is still IFRS 15 for $97k of March compute, before ALPHA-01. The paired label is not a second audited test.
30
Chapter 4 · 4.2 What can leave the balance sheet
A use right leaves
Head lease
Buzz, 24 months. ALP records a right of use and a lease liability. The 504 cards are not PPE.
Sublease
Outbound term about 24 months. Classify the right of use. Major-part-of-life is an indicator. The dates are not paired in the filing.
If finance
Right of use off. Net investment on. Head-lease liability stays. No gross hardware revenue.
Unprinted
No audited NIL. No day-1 gain in the filings. May $26.6M and June $34.4M are lessee liabilities.
Those liabilities are not Buzz’s $29.6M of undiscounted payments. IFRS 16.65: the life example is not always conclusive. A manufacturer or dealer would print selling revenue. ALP has not presented itself as one.
31
Chapter 4 · 4.2 July 2026 · company monthly, not a 6-K
Receipts exceed income
Cash out$1,250,928
Cash in$1,084,074
Finance income$465,076
Lease interest$270,318
One dollar scale, cash out at the top. $465,076 minus $270,318 is $194,758, arithmetic, not a disclosed margin. Net cash $(166,854). The company ties that gap to the $6,445,958 May prepayment, a two-year monthly credit. Do not ×12 the income.
32
Chapter 4 · 4.3 ALPHA-02 · 20-F controls
B300s are not live
576B300s. 72× Dell XE9780. Not the June “B200” line
$40.9MCost. Deposits $8.6M. Vertical Data
SwedenatNorth, Kista. 14 Sep deck: still in progress
$1.3MYear-end owned GPU PPE: 1 H200 + 1 B300
Cluster 2 revenue of $19.92M in the September deck is a projection, not a booked sales-type lease. July talks only about Alpha-01. Pennsylvania 200 MW is an option term sheet, greenfield, nothing operating. The 5 June “576 B200” loses to the 20-F B300.
33
Chapter 4 · 4.4 GAMEE runs beside it
Games are not the SPV
ALPHA-01
GPU offtake. Live May 2026. July engine is lease finance income, $465,076, plus cash collections. A lease, not a purchase price.
+
GAMEE
60% of GaMee Global, 27 May, implied $18M. Initial ~$3.5M. July revenue $489,000, EBITDA $57,000. 2025 narrative $3.5M. Q1'26 $926k.
Majority-owned games subsidiary. It keeps diluting a “pure GPU lessor.” July still shows both.
Equipment deposits 9,308. Put-right liability 7,105. Auditor: going-concern substantial doubt. A later narrative, through 13 July, puts cash and restricted cash near $10.3M. GAMEE and ALPHA-01 are both outside FY2026 revenue.
Not a lessor residual and not an NIL. The 1-for-50 split, effective 9 September, takes the count from about 77.49M to ~1.55M. Grace on the bid runs to 1 March 2027. A split does not create a sales-type note.
July finance income and the prepay memo remain a company PR. CUSIP G7185A144. Still Capital Market ALP.
36
Chapter 4 · 4.5 Contract arithmetic · not a disclosed IRR
Thin spread, thick count
Out / GPU-year≈ $31,944
Buzz in / GPU-year≈ $29,365
$32.2M − $29.6M = $2.6M over 24 months, about $108k a month, before colo, power, and opex. Prepay coverage about 20% of TCV, below the marketed $7.5M. July financing spread about $195k. July cash −$167k, which the company ties to prepay amortization. Residual, SLA, and Buzz sublease terms are not fully disclosed. Versus BIRD, 1.09× against 1.32×.
37
Chapter 4 · 4.6 Close
Large, and not pure
Neighbor
Finance / sales-type in the company’s words. Not operating. Not pure IFRS 15 for ALPHA-01.
Other stack
Buzz in, lab out, plus GAMEE. Not purchased cards.
Softer evidence
Classification is a monthly that was not a 6-K. No audited NIL.
Thinner multiple
504 cards and $32.2M TCV. Unnamed customer. Spread about 1.09×.
38
Chapter 05
What may be revenue
This chapter is only the income line each book may print.
5.1 IFRS 16 governs. The PR’s ASC 842 word is not a second set of books
5.2 A right of use can leave. The cards do not
5.3 Finance income is the line. The contract total is not
39
Chapter 5 · Income line only · pooled compute is the contrast
Where the dollar lands
IFRS 15 pool
BIRD sales-type
ALP sublease
Role
Service, if no identified server
Bought the servers
Leased 504 in, then out
Day 1
No hardware revenue
Revenue = cost, $2.758M
No disclosed hardware revenue. Liability stays
Later
The fee, as revenue
Interest income, Q2 $79k
Finance income, July $465,076
Cash
Often close to the fee
Principal reduces the NIL
Cash in $1,084,074 is not that income
$32.2M and $16.1M are contract figures. Audited FY2026 revenue is $97k. The $1,573,074 line adds Gamee revenue to Alpha-01 cash receipts. $194,758 is arithmetic on the two July income lines. The monthly was not a 6-K.
