Scilex Holding Company announced a binding term sheet to provide a $120 million cash contribution to Datavault AI Inc. under a revenue‑participation agreement. The deal will be paid in multiple tranches, with the final tranche expected before the end of 2026, and gives Scilex a tiered share of Datavault’s future revenues—30 % of gross revenue up to $250 million, 15 % up to $1.2 billion, and 5 % thereafter.
The cash will fund Datavault’s expansion of its quantum‑ready SanQtum platform, which includes a 100‑city GPU network. Datavault already owns Nvidia GPUs valued at $1.2 billion and plans to deploy the network in New York and Philadelphia in Q2 2026, with a goal of 25 operational locations within 12 months, 50 within 24 months, and full 100‑location coverage within 36 months.
Scilex’s financial position is precarious. The company reported cash and cash equivalents of $0.9 million as of September 30, 2025, and its balance sheet shows negative working capital, though the exact amount is not disclosed in the latest filing. Scilex had previously invested in Datavault AI, closing the second tranche of a two‑tranche equity financing on November 26, 2025, indicating an ongoing relationship and a willingness to support the technology venture despite its own declining revenues and net loss of $374.1 million for 2025.
Datavault CEO Nathaniel T. Bradley said the funding will “provide the capital required to execute our vision for the quantum‑ready edge network without diluting our shareholders.” He added that the GPU supply crisis has created a two‑tier market, and the SanQtum platform offers enterprises a path to secure AI compute and tokenized monetization without waiting for hyperscaler allocations.
The transaction represents a high‑risk bet for Scilex. The $120 million outflow is significant relative to its cash reserves and could strain liquidity, but it also signals a strategic pivot toward high‑growth technology assets outside its core biopharma business. Investors will weigh the potential upside of Datavalt’s expansion against Scilex’s ongoing financial challenges and the speculative nature of its broader portfolio moves.
The deal underscores the growing trend of biopharma companies diversifying into technology sectors, but it also highlights the financial fragility of companies like Scilex that rely on speculative financing to support non‑core initiatives.
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