Csquare, Inc.

Overview and Summary of Significant Accounting Policies

Csquare, Inc. (collectively with its consolidated subsidiaries referred to as “Csquare”, or the “Company”, or “we”) is a leading enterprise digital infrastructure platform, owning and operating a geographically diverse portfolio of highly engineered, carrier-neutral data centers located primarily in 21 of the largest population centers across the United States, Canada, and the United Kingdom. The Company provides carrier-neutral colocation and interconnection services that provide infrastructure, including secure space, redundant power, advanced cooling systems, physical security, and interconnection capabilities, enabling customers to deploy and operate critical IT and network infrastructure. The Company's facilities support enterprise, network, cloud, and technology customers, providing long-duration, and availability-sensitive workloads.

The Company was formed as a Delaware limited liability company under the name of BIF III US Aggregator (Delaware) LLC in 2018. The Company commenced operations on January 1, 2019 and is headquartered in Coppell, Texas. On June 15, 2026, BIF III US Aggregator (Delaware) LLC converted its legal structure from a Delaware limited liability company, to a Delaware corporation named Csquare, Inc., pursuant to the provisions of the Delaware Limited Liability Company Act and the General Corporation Law of the State of Delaware. Brookfield Corporation beneficially owns approximately 62% of our common stock through its affiliate as of September 30, 2026.

On January 12, 2024 and October 1, 2025, the Company acquiredtwo significant data center portfolios (the "2024 Portfolio Acquisition" and the "2025 Portfolio Acquisition"). These acquisitions substantially expanded the Company's data center footprint, enhanced its connectivity and service capabilities, diversified and broadened its customer base, and secured strategic real estate assets to support long-term growth.

On July 2, 2026, the Company approved and effected a reverse stock split of its common stock, which resulted in all 484,000,000 shares of the Company’s common stock combining into 103,887,373 shares of the Company’s common stock (the “Stock Split”). All information in the accompanying financial statements and notes thereto regarding common share amounts and price per share has been adjusted on a retroactive basis to give effect to the Stock Split.

Initial Public Offering -The Company’s registration statement on Form S-1 related to its initial public offering (“IPO”) was declared effective on July 15, 2026 and the Company’s common stock began trading on the New York Stock Exchange on July 16, 2026. The Company's final prospectus (the “IPO Prospectus”) was filed with the SEC on July 16, 2026. On July 17, 2026 (the “IPO Closing Date”), the Company closed its IPO pursuant to which 50,000,000 shares of its common stock were sold at a price to the public of $21.00 per share. The Company received net proceeds of approximately $1,010.0 million, after deducting the underwriting discounts and commissions of approximately $40.0 million. On July 27, 2026, the underwriters exercised their option to purchase an additional 7,499,000 shares of common stock at the initial public offering price of $21.00 per share, less underwriting discounts and commissions. As a result, the Company received additional net proceeds of approximately $149.6 million, increasing total net proceeds from the offering to approximately $1,159.6 million.

The Company used a portion of the net proceeds to repay in full the $773.9 million outstanding under its revolving credit facility, the $75.5 million outstanding under its promissory note, the $75.3 million outstanding under its Series 2024-1 Variable Funding Notes, and $219.8 million outstanding under its Series 2020-2 Class A-2 Notes, with each amount including accrued and unpaid interest through the repayment date. Refer to Note 9 - Debt for additional information. In connection with the repayment of the revolving credit facility, the Company also terminated its interest rate swap agreements. Refer to Note 8 - Derivatives for additional information.

On July 15, 2026, in connection with the completion of its initial public offering, the Company filed its Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware. The amended certificate, among other matters, established the Company's post-offering capital structure, authorizing 1,500,000,000 shares of capital stock, consisting of 1,490,000,000 shares of common stock, par value $0.01 per share, and 10,000,000 shares of preferred stock, par value $0.01 per share.

Basis of Presentation and Consolidation – The accompanying unaudited interim condensed consolidated financial statements included have been prepared in accordance with US GAAP for interim financial reporting and as required by Regulation S-X, Rule 10-01. These interim condensed consolidated financial statements are unaudited and, in the opinion of management, reflect all normal recurring adjustments necessary to fairly present the financial position, results of operations, cash flows, and change in equity for the periods presented. Results for the periods presented are not necessarily indicative of the results that may be expected for any subsequent period. The condensed consolidated balance sheet as of December 31, 2025 was derived from the audited annual financial statements but does not contain all of the footnote disclosures from the audited annual financial statements. These unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes as of and for the year ended December 31, 2025, included in the Company's IPO Prospectus. Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”). The Company’s unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

During the nine months ended September 30, 2026, there have been no changes to the Company’s significant accounting policies described in Note 2 “Summary of Significant Accounting Policies” to the consolidated financial statements and notes as of and for the year ended December 31, 2025 included in the Company's IPO Prospectus, that have had a material impact on the unaudited condensed consolidated financial statements and related notes, other than those described below.

Deferred Offering Costs - The Company capitalizes certain legal, professional accounting and other third-party fees that are directly associated with in-process equity financings as deferred offering costs until such financings are consummated. After consummation of the equity financing, these costs are reclassed to stockholders' equity (deficit) and recorded as a reduction of the proceeds from the offering. Should the planned equity financing be abandoned, the deferred offering costs are expensed immediately as a charge to operating expenses in the unaudited condensed consolidated statements of operations and comprehensive loss. Upon completion of the IPO and the underwriters' exercise of the over-allotment option, deferred offering costs of approximately$15.6 million were reclassified to additional paid-in capital as a reduction of the offering proceeds. No deferred offering costs were recorded as of December 31, 2025.

Stock-Based Compensation- In connection with the IPO, the Company adopted the Csquare, Inc. 2026 Omnibus Incentive Plan (the "2026 Incentive Plan"), which became effective immediately prior to the effectiveness of the registration statement relating to the Company's initial public offering. The 2026 Incentive Plan provides for the grant of equity-based and cash-based incentive awards to employees, directors and other service providers. Concurrently with the adoption of the 2026 Incentive Plan and the completion of the Company's initial public offering, the Company approved the replacement of certain outstanding incentive units with vested and unvested restricted shares ("RSAs"), unvested restricted stock units ("RSUs") and cash payments for eligible participants.

The Company recognized compensation expense associated with vested restricted shares and cash payments in the third quarter of 2026. The Company accounts for unvested restricted shares and RSUs in accordance with ASC 718, Compensation - Stock Compensation. Stock-based compensation expense associated with such awards is recognized over the applicable requisite service periods based on the grant-date fair value of the awards. The Company determines the fair value of restricted shares and RSUs based on the Company’s stock price on the date of grant. The Company accounts for forfeitures as they occur.

Assets held for sale- The Company classifies long-lived assets or disposal groups and related liabilities as held-for-sale when management having the appropriate authority, commits to a plan of sale, the disposal group is ready for immediate sale, an active program to locate a buyer has been initiated and the sale is probable and expected to be completed within one year. Once classified as held-for-sale, disposal groups are valued at the lower of their carrying amount or fair value less estimated selling costs. Depreciation on these properties is discontinued at the time they are classified as held for sale, but operating revenues, operating expenses and interest expense continue to be recognized until the date of disposal.

As of September 30, 2026, the Company's assets and liabilities held for sale related to certain non-strategic sites that management committed to exit. During 2026, the Company received offers to purchase these sites and subsequently entered into letters of intent with potential buyers. The Company expects the sales to be completed in the fourth quarter of 2026 or the first quarter of 2027. Assets held for sale consisted of property and equipment of $21.8 million and right-of-use assets of $8.4 million. Liabilities held for sale consisted of operating lease liabilities of $19.6 million. No loss was recognized upon classification of the sites as held for sale.

Transaction and other costs - From time to time, the Company incurs transaction and other costs consisting primarily of acquisition and integration costs, restructuring costs related to organizational and operational optimization initiatives, and expenses associated with the Company's initial public offering. Transaction and other costs are expensed as incurred and are included in Transaction and other costs in the unaudited condensed consolidated statements of operations.

Recent Accounting Pronouncements – Accounting Standards Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03: Disaggregation of Income Statement Expenses ("DISE"). The ASU requires additional disclosure of the nature of expenses included in the income statement. The ASU is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. We are currently evaluating the extent of the impact of this ASU on disclosures in our unaudited condensed consolidated financial statements.

We determined that all other recently issued accounting pronouncements that have yet to be adopted by the Company will not have a material impact on our unaudited condensed consolidated financial statements or do not apply to our operations.

Disaggregation of revenues

The following table presents the Company’s revenues disaggregated by revenue stream (in thousands):

(1) Our non-recurring revenues consist of installation services and other one-time charges such as termination fees and storage fees. These services are considered to be non-recurring because they are billed typically once, upon completion of the installation, professional service work performed, or based on customer consumption of power, rather than on a fixed, recurring basis.

(2) Refer to Note 6 - Leases for additional disclosures related to the Company’s lease arrangements under Topic 842.

Contract Balances

The following table provides a summary of the opening and closing balances of accounts receivable, net, as well as current and non-current contract assets and contract liabilities (in thousands):

During the nine months ended September 30, 2026, the change in the Company’s accounts receivable, net, contract assets, and contract liabilities primarily results from the timing difference between the satisfaction of our performance obligations, the customer's invoicing and the customer's payment. The amounts of revenue recognized during the nine months ended September 30, 2026 and 2025 from the opening contract liabilities balance were$89.2 million and$86.7 million, respectively. For the nine months ended September 30, 2026 and 2025, no impairment loss related to contract balances was recognized in the unaudited condensed consolidated statements of operations.

In accordance with Topic 326, the Company maintains an allowance for expected credit losses consisting of (i) a general reserve based on historical loss experience, current conditions, and reasonable and supportable forecasts, and (ii) specific reserves for customers with identified collectability concerns. The following table summarizes the activity of our allowance for expected credit losses (in thousands):

Remaining performance obligations

The following table presents estimated revenue expected to be recognized in the future related to the unsatisfied portion of the performance obligation as of September 30, 2026 (in thousands):

Property and Equipment, Net

Property and equipment, net consisted of the following as of September 30, 2026 and December 31, 2025 (in thousands):

Depreciation on property and equipment was$70.8 million and$49.8 million for the three months ended September 30, 2026 and 2025, respectively,$214.9 million and$150.1 million for the nine months ended September 30, 2026 and 2025, respectively, which was included in depreciation and amortization expense on the unaudited condensed consolidated statements of operations. During the three months ended September 30, 2026, the Company capitalized $7.6 million of interest costs associated with construction projects.

Supplemental unaudited condensed consolidated cash flow information related to property and equipment is as follows (in thousands):

Business Combinations

On October 1, 2025, the Company entered into an Interest Purchase Agreement (the “Purchase Agreement”) and acquired 100% of a data center portfolio from an affiliate of Brookfield Corporation, consisting of the operations of 10 data centers located in the United States and Canada that provide retail colocation services (the “2025 Portfolio” and collectively the “2025 Portfolio Acquisition”). The acquisition provides the Company with a strong diversity of existing and prospective colocation customers, expanded data center locations, and an experienced management team critical to ongoing operations. The Company paid a total preliminary purchase price of $202.5 million, consisting of $195.1 million in cash and $16.2 million placed in escrow, reduced by $2.4 million related to the settlement of a pre-existing lease between a wholly owned subsidiary of the Company and a subsidiary of the 2025 Portfolio. The preliminary purchase price was further reduced by $6.4 million, attributable to a net working capital adjustment, which has been recorded as a receivable as of December 31, 2025. The Company subsequently cash settled the receivable in the second quarter of 2026. To fund the acquisition, the Company drew $220.0 million on the 2024 Revolving Credit Facility, as defined in Note 9 - Debt.

Pursuant to the Purchase Agreement, the Company funded $16.2 million into escrow related to the resolution of requests submitted bytwo subsidiaries of the 2025 Portfolio for a change in fiscal period with the Canada Revenue Agency and Revenue Quebec. The escrow amount of $16.2 million was included in the purchase price. Given the contingency related to an uncertain tax position, the Company recorded income tax liabilities and a related indemnification asset of $16.2 million. Subsequent to the 2025 Portfolio Acquisition, the Canada Revenue Agency and Revenue Quebec denied the application to change the fiscal period-end. As a result, the $16.2 million held in escrow was released and returned to the Company during the second quarter of 2026 and was subsequently used to satisfy the related income tax obligations.

The table below sets forth the final purchase price, the final fair value of the assets acquired and liabilities assumed, and the final goodwill recognized for the acquisition (in thousands):

The Company recognized customer relationships as an intangible asset with a fair value of$63.7 million, which is being amortized over a weighted average useful life of 12.4 years. The fair values of the customer relationships were estimated using the with-and-without method. The final goodwill of$99.9 million arising from the transaction is primarily related to new customer contracts associated with expected capacity expansions after the acquisition and the workforce of the acquired businesses. The goodwill recognized is not deductible for tax purposes. The results of the 2025 Portfolio Acquisition have been included in the Company’s unaudited consolidated statements of operations since the acquisition date. During the nine months ended September 30, 2026, the Company recorded measurement period adjustments of$35.1 million, primarily related to tax matters associated with the 2025 Portfolio Acquisition.

The following unaudited pro forma financial information represents the combined results of operations as if the acquisition had occurred on January 1, 2024 (in thousands):

The results presented above reflect the impact of nonrecurring pro forma adjustments, including depreciation and amortization of acquired Property and equipment and intangible assets, acquisition-related transaction costs, interest expense on assumed debt, and the related income tax effects of these pro forma adjustments. The unaudited pro forma results do not include any anticipated synergies or other expected benefits of the acquisition. The unaudited pro forma financial information is provided for informational purposes only and is not indicative of future operations or results that would have been achieved had the acquisition been completed as of the beginning of fiscal 2024.

Goodwill and Intangible Assets, Net

Changes in goodwill as of September 30, 2026, as compared to December 31, 2025 consisted of the following (in thousands):

Intangible assets, net consisted of the following as of September 30, 2026 and December 31, 2025 (in thousands):

The Company recorded amortization expense on intangible assets of$14.1 million and$13.3 million for the three months ended September 30, 2026 and 2025, respectively, and$44.1 million and$40.8 million for the nine months ended September 30, 2026 and 2025, respectively which was included in depreciation and amortization expense on the unaudited condensed consolidated statements of operations. The Company did not record any impairment charges related to intangible assets for the nine months ended September 30, 2026 and 2025.

As of September 30, 2026, expected future amortization expense for the years indicated was as follows (in thousands):

Leases

Lessee Accounting

The Company enters into lease arrangements primarily for data center spaces, office spaces and for certain equipment. The Company determines if an arrangement is or contains a lease at inception. The Company recognizes a right-of-use asset and lease liability on the unaudited condensed consolidated balance sheets for all leases with a term longer than 12 months. Many of the Company’s lease agreements include options to extend the lease, which are not included in the minimum lease payments unless they are reasonably certain to be exercised at lease commencement. Rental expense related to operating leases is recognized on a straight-line basis over the lease term. Operating lease right-of-use assets are presented as right-of-use assets on the unaudited condensed consolidated balance sheets, while finance lease right-of-use assets are included within property and equipment, net.

The Company subleases certain office space that it does not intend to occupy. The sublease arrangement expires during the year 2030 and provides for escalations of lease payments in the normal course of business.

The components of lease expenses and income for thethree and nine months ended September 30, 2026 and 2025 are as follows (in thousands):

In the Company’s unaudited condensed consolidated statements of operations, amortization of right-of-use assets under finance leases and interest on finance lease liabilities are included in depreciation and amortization and interest expense, respectively. Operating lease costs for data centers are included in cost of revenues, and operating lease costs for office leases are included in selling, marketing, general and administrative expenses in the Company’s unaudited condensed consolidated statements of operations.

For the three and nine months ended September 30, 2026 and 2025, the Company didnot record any impairment charges related to right-of-use assets.

On May 20, 2026, the Company entered into a Surrender Agreement with the landlord of its Hawthorne, California facility. The Company did not exercise any renewal options under the lease and surrendered the leased premises on May 31, 2026. In accordance with ASC 842, the Company derecognized the remaining lease liability and right-of-use asset associated with the lease upon termination. As a result, the Company recognized a net gain of $40.0 million during thenine months ended September 30, 2026, which is included in gain on lease modification in the Company’s unaudited condensed consolidated statements of operations.

Supplemental unaudited condensed consolidated cash flow and other information related to leases is as follows (in thousands):

As of September 30, 2026, maturities of lease liabilities were as follows (in thousands):

Lessor Accounting

The Company enters into lease arrangements, as lessor, primarily for data center spaces. Our leases generally have non-cancelable initial lease terms ranging from five toten years andmay include options to extend or renew the lease for additional periods. Lease payments typically consist of fixed payments, including contractual rent escalation provisions, and, for certain leases, variable lease payments. Variable lease payments are primarily based on usage or other factors specified in the lease agreements and are billed in arrears based on actual consumption. The lease arrangements do not contain purchase options.

A summary of minimum lease payments due from our customers under operating leases of colocation space within data center environments, as well as other facilities leased under triple net arrangements are shown below. These amounts do not reflect future rental revenues from renewal or replacement of existing leases unless we are reasonably certain we will exercise the option or the lessee has the sole ability to exercise the option. Reimbursements of operating expenses and variable rent increases are excluded from the table below.

The components of operating lease income for thethree and nine months ended September 30, 2026 and 2025 are as follows (in thousands):

Future minimum lease receipts for operating leases under Topic 842 as of September 30, 2026 are as follows (in thousands):

Property and equipment, net, associated with operating lease income consisted of the following as of September 30, 2026 and December 31, 2025 (in thousands):

Depreciation on property and equipment underlying operating lease income was$9.8 million and$3.9 million, for the three months ended September 30, 2026 and 2025, respectively, and$34.3 million and$11.5 million, for the nine months ended September 30, 2026 and 2025, respectively, and was included in depreciation and amortization expense on the unaudited condensed consolidated statements of operations.

Other Current Assets and Accrued Expenses

The components of certain unaudited condensed consolidated balance sheets accounts are as follows (in thousands):

Derivatives

The Company is party to various interest rate swap agreements designated and qualifying as cash flow hedges of the Company's forecasted variable interest cash flows. The swaps were designed to hedge exposure to floating interest rates on the 2024 Term Loan Facility (as defined in Note 9 - Debt) for the nine months ended September 30, 2025 and on the 2024 Revolving Credit Facility (as defined in Note 9 - Debt) for the nine months ended September 30, 2026.

During 2025, the Company terminated its outstanding interest rate swap agreements in connection with three separate prepayments of the 2024 Term Loan Facility. As a result, the Company had no designated interest rate swap agreements outstanding as of December 31, 2025.

In February 2026, the Company entered into new interest rate swap agreements designated as cash flow hedges of variable-rate borrowings under the 2024 Revolving Credit Facility. In July 2026, the Company terminated all outstanding swap agreements in connection with the repayment of the 2024 Revolving Credit Facility. Accordingly, the Company had no designated interest rate swap agreements outstanding as of September 30, 2026.

The following table presents a roll-forward of interest rate swaps activity and the related impacts on accumulated other comprehensive (loss) income ("AOCI") and earnings for the periods presented (in thousands):

Debt

The Company’s total debt obligations are as follows (in thousands):

(1) For the asset-backed secured notes, the maturity is the anticipated repayment date.

(2) Includes amortization of debt premiums (discounts) and debt issuance costs and the impact of interest rate swap instruments.

(3) The 2024 Revolving Credit Facility has a maturity of December 2026, with provision for two successive terms ofone year each, subject to certain conditions. The Company intends to extend the maturity for at leastone year.

As of September 30, 2026, the future principal payments for the Company’s debt were as follows (in thousands):

For thethree and nine months ended September 30, 2026 and 2025, total interest expense for the Company’s debt obligations was as follows (in thousands):

(1)Includes interest rate swap settlements in the amount of$0.1 million and$0.6 million as a reduction of stated interest expense for the three months ended September 30, 2026 and September 30, 2025, respectively, and$0.4 million and$3.4 million as a reduction of stated interest expense for the nine months ended September 30, 2026 and September 30, 2025, respectively. Stated interest expense is presented net of interest costs capitalized as part of property and equipment.

2021 Fund Revolving Credit Facility

Prior to the IPO, Csquare, Inc. was a named borrower under a revolving credit agreement entered into by investment funds affiliated with Brookfield Corporation (the “2021 Fund Revolving Credit Facility”), under which Csquare, Inc. was jointly and severally liable for obligations under the facility, which allowed the Company to borrow, repay and re-borrow over its term.

On June 30, 2026, investment funds affiliated with Brookfield Corporation entered into an amended revolving credit facility agreement, pursuant to which the Company was released from its obligations as a Qualified Borrower under the 2021 Fund Revolving Credit Facility. In connection with the release, all outstanding borrowings and accrued interest attributable to the Company were repaid, and the lenders terminated their commitments and obligations to extend credit to the Company under the facility. No gain or loss was recognized in connection with the release.

As of September 30, 2026, there wasno balance outstanding under the 2021 Fund Revolving Credit Facility following the Company's release from the facility on June 30, 2026. There wereno outstanding borrowings under the facility as of December 31, 2025.

2024 Term Loan Facility

On January 12, 2024, certain subsidiaries of the Company entered into a loan agreement (the “2024 Term Loan Agreement”), pursuant to which the Company received atwo-year term loan with an aggregate principal amount of $1,965.9 million (the “2024 Term Loan”). The 2024 Term Loan Facility bore interest at a rate based on the SOFR plus 3.75% with 25.0 basis point step up at month 13 and every 6 months thereafter until maturity of the original principal amount per annum.

On March 1, 2024, the Company amended its 2024 Term Loan Agreement to increase the principal amount of loan by $33.0 million.

On March 11, 2025, the Company prepaid outstanding principal of $646.7 million under the 2024 Term Loan Facility. In conjunction with the debt repayment the Company recognized a debt extinguishment charge of $5.3 million.

On August 21, 2025, in conjunction with the asset-backed borrowings, the Company prepaid outstanding principal of $431.3 million under the 2024 Term Loan Facility. In conjunction with the debt repayment, the Company recognized a debt extinguishment charge of $1.6 million.

On December 4, 2025, in conjunction with the asset-backed borrowings, the Company prepaid outstanding principal of $165.6 million under the 2024 Term Loan Facility. As a result, the Company has fully paid down the 2024 Term Loan Facility.

2024 Revolving Credit Facility

On January 12, 2024, certain subsidiaries of the Company entered into a Revolving Credit Facility (the “2024 Revolving Credit Facility”) with Wells Fargo Securities, LLC and TD. The 2024 Revolving Credit Facility provided for revolving loans in an aggregate principal amount of up to $200.0 million over athree-year term. As a part of the 2024 Revolving Credit Facility there is a sub-limit restriction for the issuance of letters of credit of up to $50.0 millionat any one time. Borrowings under the 2024 Revolving Credit Facility bear interest of SOFR plus a margin of 4.25% and the Company is required to pay 0.75% per annum on the average daily unused portion of the 2024 Revolving Credit Facility. The Company is required to pay a 4.50% per annum letter of credit fee.

On February 28, 2025, the Company amended the 2024 Revolving Credit Facility to increase total commitments from $200.0 million to $300.0 million and to reduce the applicable interest rate margin from SOFR plus 4.25% to SOFR plus 3.00%.

On December 22, 2025, the Company closed a $500.0 million upsize to the 2024 Revolving Credit Facility with a maturity of December 2026, with provision for two successive terms ofone year each, subject to certain conditions. The Company intends to extend the maturity for at leastone year. The upsize also included an amendment to the Company’s financial covenants.

As of September 30, 2026, the Company hadno outstanding borrowings under the 2024 Revolving Credit Facility and had approximately $797.0 million of available borrowing capacity, net of $3.0 million of outstanding letters of credit. As of December 31, 2025, the outstanding balance under the 2024 Revolving Credit Facility was $659.0 million.

As of September 30, 2026 and December 31, 2025, the Company was in compliance with all financial covenants and requirements related to the 2024 Revolving Credit Facility.

Asset-Backed Notes

On October 17, 2024, certain subsidiaries of the Company completed an asset-backed securitization transaction totaling $885.0 million. The Company issuedtwo series of fixed-rate notes - Series 2024-1 and Series 2024-2 (together, the “Series 2024-1/2 Notes”) pursuant to an indenture (the “2024 Indenture”).

On March 20, 2025, certain subsidiaries of the Company completed an asset-backed securitization transaction totaling $940.0 million. The Company issuedtwo series of fixed-rate notes - Series 2025-1 and Series 2025-2 (together, the “Series 2025-1/2 Notes”) pursuant to a series supplement to the 2024 Indenture.

On August 21, 2025, certain subsidiaries of the Company completed an asset-backed securitization transaction totaling $815.0 million. The Company issuedtwo series of fixed-rate notes - Series 2025-3 and Series 2025-4 (together, the “Series 2025-3/4 Notes”) pursuant to a series supplement to the 2024 Indenture.

On October 1, 2025, as a result of the 2025 Portfolio Acquisition, the Company acquired three series of fixed-rate notes - Series 2020-1/2 Notes, Series 2021-1 Notes, and Series 2022-1 Notes for a total of $743.0 million. The Series 2020-1/2 Notes, Series 2021-1 Notes, and Series 2022-1 Notes are governed by an indenture (the “2020 Indenture”).

On December 4, 2025, certain subsidiaries of the Company completed an asset-backed securitization transaction totaling $1,100.0 million. The Company issued three series of fixed-rate notes - Series 2025-5, Series 2025-6 and Series 2025-7 (together, the “Series 2025-5/6/7 Notes”) pursuant to a series supplement to the 2024 Indenture.

On December 4, 2025, in conjunction with the Series 2025-5/6/7 Notes, the Company paid off $220.0 million of Series 2020-1/2 Notes.

On August 6, 2026 and August 10, 2026, the Company made principal prepayments of $150.0 million and $69.5 million, respectively, on the Series 2020-2 Notes, partially reducing the outstanding balance. In conjunction with the debt repayment, the Company recognized a debt extinguishment charge of $6.8 million.

The Series 2020-2 Notes, Series 2021-1 Notes and Series 2022-1 Notes are secured by a collateral pool consisting of multi-tenant enterprise data centers, held in fee simple interests.

The Series 2024-1/2 Notes, Series 2025-1/2 Notes, Series 2025-3/4 Notes and Series 2025-5/6/7 Notes are secured by a separate and distinct collateral pool consisting of multi-tenant enterprise data centers, held in both fee simple and leasehold interests.

The Series 2020-2 Notes, Series 2021-1 Notes, Series 2022-1 Notes, Series 2024-1/2 Notes, Series 2025-1/2 Notes, Series 2025-3/4 Notes, and Series 2025-5/6/7 Notes are collectively referred to as the “Asset-Backed Secured Notes.”

The Asset-Backed Secured Notes were issued in the following tranches, with Note Principal Balances presented as of September 30, 2026 (dollars in thousands):

The Asset-Backed Secured Notes are classified as long-term debt, net of deferred financing costs in the unaudited condensed consolidated balance sheets.

Interest expense on the Asset-Backed Secured Notes is recognized using the effective interest method. Direct costs incurred in connection with the issuance of the Asset-Backed Secured Notes are capitalized as deferred financing costs and amortized over the expected life of the related debt using the effective interest method.

The unamortized deferred financing costs are presented as a direct deduction from the carrying amount of each note in the unaudited condensed consolidated balance sheets. As of September 30, 2026 and December 31, 2025, the Company had unamortized deferred financing costs for the Asset-Backed Secured Notes as follows (dollars in thousands):

As of September 30, 2026 and December 31, 2025, the Company was in compliance with all financial covenants and requirements related to its Asset-Backed Secured Notes.

Variable Funding Note

The 2024 Indenture provided for $100.0 million of asset-backed, floating rate Series 2024-1 Secured Data Center Revenue Variable Funding Note (the “Series 2024-1 VFN” or "Variable Funding Note") over afive-year term. On August 21, 2025, the Company entered into an amendment whereby the Company increased the sub-limit restriction for the issuance of letters of credit of up to $25.0 million at any one time from $15.0 million at any one time. The applicable interest rate is equal to the SOFR plus 2.45%. The Company is required to pay 0.50% per annum on the average daily unused portion of the Variable Funding Note. The Company is required to pay a 2.00% per annum letter of credit fee.

The Series 2024-1 VFN has a revolving note structure and is intended to be used primarily for general corporate purposes, including working capital needs for the multi-tenant data centers securing the Series 2024-1/2 Notes, Series 2025-1/2 Notes, Series 2025-3/4 Notes, and Series 2025-5/6/7 Notes.

As of September 30, 2026, there wereno outstanding borrowings under the Series 2024-1 VFN. As of December 31, 2025, outstanding borrowings under the Series 2024-1 VFN were$75.0 million.

As of September 30, 2026 and December 31, 2025, the Company was in compliance with all of its financial covenants related to the Series 2024-1 VFN.

Employee Benefits

The Company assumed a qualified defined benefit plan (the “Pension Plan”) covering a portion of the U.S. Company's employees. Benefits accrue to eligible employees based on years of service and compensation. The Company also assumed a post-employment benefit plan other than pensions (the “OPEB”) for the associated employees. The plan is provided to certain domestic employees who meet specific age, participation and length of service requirements at the time of retirement.

The Company madeno contributions to the pension plan during the three months ended September 30, 2026 and 2025, respectively, and contributed$3.5 million and$1.2 million during the nine months ended September 30, 2026 and 2025, respectively. The Company recognizedno expenses related to the Pension Plan or OPEB during the three months ended September 30, 2026 and 2025, respectively, and recognized expense of$0.5 million and$0.1 million during the nine months ended September 30, 2026 and 2025, respectively. Net periodic pension and postretirement benefit cost was not material for any period presented, either in the aggregate or for any individual component, including service cost, interest cost, expected return on plan assets, actuarial gains and losses, and amortization of prior service cost or credit.

The Company terminated the Pension Plan on April 29, 2026. In connection with the plan termination, the Company settled benefit obligations through distributions to plan participants totaling $7.0 million.

Stockholders'/Member's Equity

General

Pursuant to the BIF III US Aggregator (Delaware) LLC agreement (the "LLC Agreement"), the Company is authorized to issue a single class of member’s interest which are designated as common units. As of December 31, 2025, the Company has issued 103,887,373 units. The common units represent the only class of member’s equity interests authorized and outstanding. The Company does not have preferred equity or multiple classes of member’s interests.

Each common unit represented a unit of limited liability company interest and entitled the holder to one vote per unit, allocations of profits and losses, and distributions of available earnings, in proportion to ownership of common units, in accordance with the LLC Agreement and applicable law.

On June 15, 2026, BIF III US Aggregator (Delaware) LLC converted its legal structure from a Delaware limited liability company, to a Delaware corporation named Csquare, Inc., pursuant to the provisions of the Delaware Limited Liability Company Act and the General Corporation Law of the State of Delaware.

On July 15, 2026, in connection with the completion of its initial public offering, the Company filed its Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware. The amended certificate, among other matters, established the Company's post-offering capital structure, authorizing 1,500,000,000 shares of capital stock, consisting of 1,490,000,000 shares of common stock, par value $0.01 per share, and 10,000,000 shares of preferred stock, par value $0.01 per share.

Each share of common stock entitles the holder to one vote on all matters submitted to a vote of stockholders, except as otherwise required by law or the Company's certificate of incorporation. Holders of common stock are entitled to receive dividends when and if declared by the Board of Directors from legally available funds, subject to the rights of any outstanding preferred stock. In the event of the Company's liquidation, dissolution or winding up, holders of common stock are entitled to share ratably in the distribution of any remaining assets after payment of liabilities and satisfaction of any preferential rights of holders of preferred stock.

The Board of Directors is authorized, without further stockholder approval, to issue preferred stock in one or more series and to establish the voting powers, preferences and rights of each series, including dividend rights, liquidation preferences, redemption provisions and conversion rights. As of September 30, 2026, no shares of preferred stock were issued or outstanding.

As of September 30, 2026, the Company had 166,633,984 shares of common stock issued and outstanding andno shares of preferred stock issued or outstanding.

Stock Incentive Plans

In connection with the completion of its IPO, the Company adopted the 2026 Incentive Plan, which became effective immediately prior to the effectiveness of the registration statement relating to the IPO. The purpose of the 2026 Incentive Plan is to attract, retain and motivate employees, directors, consultants and other service providers and to align their interests with those of the Company's stockholders.

The 2026 Incentive Plan authorizes the grant of incentive stock options, nonqualified stock options, stock appreciation rights ("SARs"), RSAs, RSUs, other stock-based awards and cash-based awards. The Compensation Committee of the Board of Directors administers the 2026 Incentive Plan and determines the participants, award terms and conditions, including vesting, exercisability, settlement and performance requirements. Awards may be granted to employees, directors, consultants and other eligible service providers of the Company and its affiliates.

The 2026 Incentive Plan reserves 13,381,510 shares of the Company's common stock for issuance pursuant to equity awards. Shares subject to awards that expire, are forfeited, cancelled or settled in cash generally become available for future grants under the plan. The maximum number of shares that may be issued pursuant to incentive stock options is equal to the plan share reserve. The 2026 Incentive Plan does not provide for automatic annual increases to the number of shares authorized for issuance and will expire on the tenth anniversary of its effective date unless terminated earlier by the Board of Directors.

Concurrently with the adoption of the 2026 Incentive Plan and completion of the IPO, the Company replaced certain outstanding pre-IPO incentive arrangements with 1.1 million vested RSAs,4.1 million unvested RSAs,1.3 million RSUs and cash payments for eligible participants. The replacement equity awards generally vest based on continued service over the remaining requisite service periods and provide for accelerated vesting upon certain liquidity events. Holders of RSAs are the record owners of the underlying shares and are entitled to the same voting rights as other holders of common stock.

During the three and nine months ended September 30, 2026, the Company recognized $32.1 million of stock-based compensation expense under the 2026 Incentive Plan, of which $31.4 million related to replacement equity awards. The Company also recognized $25.3 million of compensation expense related to the cash settlement of legacy pre-IPO incentive compensation arrangements.

Net Loss per Share

The Company applies the two-class method for calculating basic earnings per share. Under the two-class method, net income (loss) is reduced by cumulative preferred stock dividends and the residual amount is allocated between common stock and other participating securities based on their participation rights. Participating securities are comprised of RSAs, which participate in dividends, if declared, by the Company. Holders of restricted stock receive non-forfeitable dividends at the same rate as common stockholders and they both share equally in undistributed earnings. Therefore, under the two-class method the difference in earnings per share is not significant for these participating securities. As the Company has reported a net loss for all periods, and the participating securities were not contractually obligated to share in the losses of the Company, accordingly, no losses were allocated to the participating securities.

Basic earnings per share is calculated by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding, excluding unvested restricted common stock. Diluted earnings per share is calculated by dividing the net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding, adjusted for the effects of potentially dilutive common stock, which are comprised of restricted stock units and unvested restricted stock, using the treasury-stock method. Because the Company reported losses attributable to common stockholders for all periods presented, all potentially dilutive common stock are antidilutive for those periods.

The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders during the three andnine months ended September 30, 2026 and 2025 (in thousands, except per share data):

The number of securities that were excluded from the calculation of diluted net loss per share attributable to common stockholders for the periods presented because including them would have been anti-dilutive are as follows (in thousands):

Income Taxes

The Company accrues for income taxes during interim periods based on the estimated effective tax rate for the year. The effective tax rate is subject to change in the future due to various factors, such as the Company's operating performance and tax law changes. The Company's effective tax rate was(0.1)% and 13.3% for the three months ended September 30, 2026 and 2025, respectively, and(0.2)% and 13.4% for the nine months ended September 30, 2026 and 2025, respectively. The September 30, 2026 and 2025 effective tax rates differ from the statutory rate due primarily to non-deductible expenses and changes in valuation allowances.

Commitments and Contingencies

Guarantees and Indemnifications

The Company maintains credit support arrangements with certain utility providers to support its contractual obligations. As of September 30, 2026 and December 31, 2025, the aggregate amount of such credit support arrangements was CAD 26.0 million, equivalent to approximately USD $18.3 million and USD $18.6 million, respectively.

Legal Contingencies

From time to time the Company may be involved in various legal proceedings arising from the normal course of business activities. We are not presently a party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or taken together have a material adverse effect on our business, results of operations, cash flows or financial condition. As of September 30, 2026 and December 31, 2025, the Company has not accrued any material potential loss.

Related Party Transactions

Related Party Revenues and Expenses

During the three and nine months ended September 30, 2026, an affiliate of the Parent paid certain costs associated with our initial public offering on the Company's behalf. Such amounts were recorded as due to related parties in the unaudited condensed consolidated balance sheets. As of September 30, 2026, the outstanding balance due was approximately $8.8 million. No such balance was outstanding as of December 31, 2025.

The Company recognized related party revenue with affiliates of the Parent of$2.4 million and$0.8 million during the three months ended September 30, 2026 and 2025, respectively, and$7.0 million and$2.4 million during the nine months ended September 30, 2026 and 2025, respectively, which are included in revenues in the unaudited condensed consolidated statements of operations. As of September 30, 2026 and December 31, 2025, there wereno outstanding balances due to these related party revenues.

During the three and nine months ended September 30, 2026, the Company recognized related party expenses with affiliates of the Parent of $0.3 million and $0.4 million, respectively, which are included in cost of revenues, excluding depreciation and amortization in the unaudited condensed consolidated statements of operations. These expenses primarily relate to software and technology services provided by affiliates of the Parent.

During the three and nine months ended September 30, 2025, the Company recognized related party expenses with affiliates of the Parent of$1.1 million and$3.2 million, respectively, which are included in selling, marketing, general and administrative in the unaudited condensed consolidated statements of operations. The expenses primarily relate to rent expenses.

As of September 30, 2026 and December 31, 2025, there wereno outstanding balances due to these related party expenses.

In 2024, the Company provided management services to an affiliate of the Parent. As of September 30, 2026 and December 31, 2025, the outstanding balance due from the affiliate for these services was approximately$1.2 million and$2.5 million, respectively.

Related Party Loans

On May 14, 2026, an affiliate of the Parent issued an unsecured promissory note to the Company with an aggregate principal amount of $75.0 million. The note bore interest at a rate of 3.54% per annum and was scheduled to mature on May 14, 2029. In July 2026, the Company repaid the note in full using a portion of the net proceeds from its initial public offering. As a result, there wasno outstanding balance under the note as of September 30, 2026. Interest incurred on the note was included in Interest expense in the unaudited condensed consolidated statements of operations.

In 2025, the Company paid certain bonuses to executives on behalf of an affiliate of the Parent in return for a loan receivable from the affiliate. As of December 31, 2025, the outstanding balance due from affiliates was approximately $8.3 million. During the nine months ended September 30, 2026, the respective loan was forgiven and the Company recognized $8.3 million employee loan extinguishment costs, which are included in selling, marketing, general and administrative in the unaudited condensed consolidated statements of operations. The loan earned interest at a market-based rate and interest income is included in Other income (loss), net in the unaudited condensed consolidated statements of operations.

In 2025, the Company paid debt on behalf of an affiliate of the Parent in return for a loan receivable from the affiliate. As of September 30, 2026 and December 31, 2025, the outstanding balance due from affiliates was approximately $6.4 million and $6.4 million, respectively.

On March 11, 2025, the Company received a $646.0 million loan from Parent, the proceeds of which were used to repay outstanding principal under the Company’s 2024 Term Loan Facility in advance of the Company’s Series 2025-1/2 Notes issuance. On March 20, 2025, the bridge loan from Parent was repaid utilizing the proceeds received from the Series 2025-1/2 Notes issuances.

Related Party Deposits

From time to time, the Company temporarily deposits cash with affiliates of Parent bearing interest at a market-based rate. The deposits are presented in due from related parties on the unaudited condensed consolidated balance sheets and interest income recognized in Other income (loss), net in the unaudited condensed consolidated statements of operations. As of December 31, 2025, the Company had a deposit with an affiliate of the Parent of$127.6 million that bore interest at 3.99% per annum. The deposit matured during the second quarter of 2026, and the Company hadno deposits with affiliates of the Parent as of September 30, 2026.

Segment Reporting

The Company's chief operating decision maker ("CODM") evaluates the performance of the Company’s segment based upon consolidated net loss and considers budget-to-actual or forecast-to-actual variances to assess performance and make decisions about allocating resources. The CODM is regularly provided disaggregated expense information at a level more detailed than that presented in financial statements herein.

The following tables present the significant revenue streams, significant segment expenses and other segment items regularly reviewed by our CODM, as well as consolidated net loss (in thousands):

(1)Other segment items are primarily comprised of cost of revenues related to data center security services, commissions paid to third-party business partners, and other professional services associated with site management.

The following table provides information about disaggregated revenue by primary geographic region (in thousands):

The following table provides information about long-lived assets by primary geographical region (in thousands):

Fair Value Measurement

The Company’s financial instruments include cash, cash equivalents, restricted cash, accounts receivable, accounts payable and accrued liabilities. Cash, cash equivalents, restricted cash, accounts receivable, accounts payable, and accrued liabilities are stated at their carrying value, which approximates fair value due to the short time to the expected receipt or payment date.

The 2021 Fund Revolving Credit Facility, 2024 Term Loan Facility, 2024 Revolving Credit Facility, and Series 2024-1 VFN (as defined in Note 9 - Debt) are considered Level 2 instruments and recorded at book value on the Company’s unaudited condensed consolidated balance sheets. As they reprice frequently due to variable interest rate terms and entail no significant changes in credit risk, the fair value approximates carrying value. Refer to Note 9 - Debt for additional information.

The Series 2020-2 Notes, Series 2021-1 Notes, and Series 2022-1 Notes (as defined in Note 9 - Debt), which contain a fixed rate coupon, were assumed on October 1, 2025. These notes are considered Level 2 instruments. Due to the proximity of the date the Company acquired the Series 2020-2 Notes, Series 2021-1 Notes, and Series 2022-1 Notes to December 31, 2025, and the absence of significant changes in market interest rates or the Company’s credit risk since the acquisition date, the carrying amount of the Series 2020-2 Notes, Series 2021-1 Notes, and Series 2022-1 Notes approximates their fair value at December 31, 2025. Refer to Note 9 - Debt for additional information.

The fair value of fixed rate debt as of December 31, 2025, was as follows (in thousands):

The fair value of fixed rate debt as of September 30, 2026, was as follows (in thousands):