MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

References in this report (the "Quarterly Report") to "we," "us" or the "Company" refer to Solidion Technology, Inc. References to our "management" or our "management team" refer to our officers and directors. The following discussion and analysis of the Company's financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may," "should," "could," "would," "expect," "plan," "anticipate," "believe," "estimate," "continue," or the negative of such terms or other similar expressions. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those described in our other SEC filings.

Overview

Solidion Technology, Inc. is an advanced battery technology company focused on the development and commercialization of next-generation battery materials, components, and energy storage solutions. Headquartered in Dallas, Texas, with research and development (R&D) and manufacturing operations in Dayton, Ohio, Solidion is dedicated to transforming the energy storage landscape by addressing key limitations in current lithium-ion and emerging battery technologies.

The Company specializes in high-performance silicon-rich anode materials, solid-state battery technology, and fire-retardant electrolytes, aiming to enhance the energy density, safety, and cost-effectiveness of lithium-ion batteries. Solidion's proprietary innovations include graphene-enabled batteries, elastomer-protected electrodes, quasi-solid and solid-state electrolytes, and biochar-derived anode materials, providing sustainable and scalable solutions for the electric vehicle (EV), energy storage system (ESS), and consumer electronics markets.

Solidion holds an extensive intellectual property (IP) portfolio with over 345 active patents (pending and granted) globally, positioning the Company as a leader in silicon anode and solid-state battery technology. Its innovative silane-free production processes for silicon-based anode materials allow for lower manufacturing costs and improved scalability. Additionally, its fire-retardant and polymer-based electrolytes enable safer, high-energy-density batteries compatible with existing lithium-ion cell production infrastructure.

A key milestone in Solidion's technological advancements is the successful development of a high-energy cylindrical cell, which achieves an exceptional energy density of 305 Wh/kg, significantly higher than conventional lithium-ion batteries, which typically range between 240-260 Wh/kg. This innovation not only enhances the range and performance of EVs but also underscores Solidion's ability to deliver cutting-edge solutions for high-energy and high-power applications.

The Company has established strategic partnerships with leading industry players, including Giga Solar Materials Corp. and Bluestar Materials Company, to advance the production and commercialization of silicon oxide (SiOx) anode materials in the U.S. These collaborations, along with Solidion's ongoing engagement with EV original equipment manufacturers (OEMs) and toll-manufacturing partners, position the Company to accelerate the adoption of its next-generation battery solutions.

On November 14, 2024, we adopted a strategic Bitcoin allocation policy for our Corporate Treasury. As part of this strategy, Solidion is committed to leveraging Bitcoin as a long-term store of value. The Company will allocate excess cash from operations toward Bitcoin purchases, subject to board approval. Additionally, interest earnings from cash held in money market accounts will be converted into Bitcoin. The Company also plans to allocate a portion of future capital raises to Bitcoin acquisitions, demonstrating a sustained commitment to integrating Bitcoin into its financial strategy.

For fiscal years 2025 and 2024, the Company did not identify excess cash from operations available for Bitcoin purchases. Additionally, the Company generated interest income of $19,094 and $13,806 during fiscal year 2025 and 2024, respectively. These amounts have been designated for Bitcoin purchases in fiscal year 2026 as part of the ongoing treasury strategy. The Company did not conduct any capital raise activities between the date of its announcement and the end of the reporting period and, as a result, did not allocate any proceeds toward Bitcoin purchases. Looking ahead, during fiscal year 2026, Solidion may consider capital raises that will include allocation of a portion of proceeds to Bitcoin acquisitions.

Solidion is committed to advancing battery technology through continuous R&D efforts, expanding manufacturing capabilities, and optimizing supply chain sustainability. By integrating cutting-edge materials and scalable production methods, Solidion aims to deliver high-performance, cost-effective, and environmentally sustainable battery solutions that address the increasing demand for electrified mobility and renewable energy storage.

Our Products

Anode Materials Our product portfolio includes graphite-based anode materials, distinguished by our commitment to utilizing raw materials from sustainable sources. As part of our efforts to contribute to the goal of net-zero greenhouse gas emissions by 2050, we are scrutinizing our entire supply chain to identify opportunities for reducing environmental impacts. Graphite, a critical component in rechargeable batteries due to its longevity and cost-efficiency, is traditionally derived from petroleum coke and pitch. Solidion's innovative approach introduces biochar produced from waste biomass as an alternative feedstock. This sustainable process not only sequesters carbon but may also result in carbon-negative production. By leveraging biochar, Solidion aims to produce anode-grade graphite with exceptional performance. By the end of 2024, Solidion's anode materials containing biochar-derived materials have achieved a capacity of over 340 mAh/g and comparable cycle life to conventional graphite anodes, marking a significant step towards more environmentally responsible battery manufacturing. Solidion has also developed a series of silicon and SiOx anode materials that enable a significantly higher energy density (for example, an expected 20-30% increase in the EV driving range) likely at a reduction in the cell cost in terms of U.S. dollars per kilowatt hour ("kWh") when production in scale occurs. The specific capacity of these products range from 1,300 to 2,800 mAh/g aiming to suit different applications including EV, energy storage stations, drones, and consumer electronics.

Battery Cells To rigorously validate the performance of its innovative anode materials, Solidion is actively engaged in the development and testing of a diverse portfolio of battery cells. By the close of 2024, Solidion, in collaboration with strategic partners, has successfully constructed and evaluated over three distinct types of cylindrical cells, each featuring either our advanced silicon (Si) or graphite-based anodes. These cells showcase a wide range of capabilities, with capacities spanning from 4.6 to an impressive 5.5Ah.

Notably, our high-energy 5.5Ah 21700 cylindrical cell represents a significant leap forward in battery technology. This cell not only achieves an exceptional energy density of 305 Wh/kg, surpassing the typical 240-260 Wh/kg offered by established Asian manufacturers in the same high-energy category, but also delivers superior power performance. It boasts a continuous charging and discharging capability exceeding 2C, a substantial improvement over the performance less than 1C typically seen in competitor products. This combination of high energy density and robust power handling makes our 5.5Ah cell ideally suited for applications demanding both sustained energy delivery and moderate to high power output, such as advanced electric vehicles and high-performance portable electronics.

Furthermore, Solidion is actively developing cell variants tailored for applications requiring even higher power capabilities. These cells have already demonstrated impressive fast-charging capabilities, exceeding 3C, enabling rapid replenishment of energy and minimizing downtime. This focus on high-power cells underscores our commitment to addressing the diverse needs of the evolving energy storage market.

Beyond anode advancements, Solidion is also pioneering the development of next-generation electrolytes. As previously mentioned, we have successfully formulated fire-retardant and quasi-solid electrolytes, demonstrating their performance through the construction of small prototype cells. These electrolytes represent a significant step towards enhancing battery safety, a critical consideration in today's demanding applications. Looking ahead, Solidion intends to scale up production of these electrolyte-based cells, manufacturing larger format cells in common practical sizes. This initiative will not only validate the performance of our advanced electrolytes in real-world scenarios but also pave the way for the development of safer and more reliable energy storage solutions. By integrating our innovative anode materials with these advanced electrolytes, Solidion is poised to deliver a new generation of high-performance, safe, and sustainable batteries.

Recent Developments

Memorandum of Understanding

On February 10, 2026, we entered into a non-binding memorandum of understanding ("MOU") with an entity that manufactures and distributes energy storage systems for the Company to supply pouch cells for use in energy storage systems. While the MOU is non-binding in nature and may result in no actual sales, a definitive agreement could potentially add an estimated $4 to $6 million in revenue over the next 12 months.

Grants from the U.S. Government

During the fourth quarter of 2025 and the first quarter of 2026, the Company was notified that it had received three grants from various departments of the U.S. government. The U.S. Department of Energy ("DOE") provided the first grant (the "First Grant"), which was to advance research and development of Electrochemical Manufacturing of High-Performance Graphite based on Biomass-Derived Carbon. The Company had received the prestigious 2025 R&D 100 Award in partnership with Oak Ridge National Laboratory for innovation in Electrochemical Graphitization in Molten Salts, and the First Grant was for research to be conducted jointly with Oak Ridge National Laboratory to reduce imports of critical energy materials from foreign sources, improve American energy independence, and ensure that the U.S. maintains a technological lead in developing and deploying advanced energy technologies.

The DOE provided the second grant (the "Second Grant") to scale up the synthesis of a carbon-nanosphere material that will be used as an anti-corrosive additive in molten-salts-based heat transfer fluids for advanced molten salt nuclear reactors. The Second Grant was also for research to be conducted jointly with Oak Ridge National Laboratory, this time to develop a nanofluids-based energy material, engineered colloidal suspension of hollow carbon nanoparticles in conventional molten salts, to enhance heat transfer and reduce corrosion in nuclear reactors, which is critical for reducing costs, increasing safety, and accelerating the commercialization of small modular nuclear reactors such as advanced molten salt reactors.

The U.S. Army provided the third grant (the "Third Grant") to develop an advanced fiber-based electronic battery system built on a coaxial carbon nanotube ("CNT") yarn architecture. The Third Grant was for research to be conducted jointly with The University of Texas at Dallas to develop a flexible, rechargeable lithium-ion battery in fiber form: a CNT yarn serves as both the structural core and current collector of the anode, integrated with Solidion's silicon (Si) as the high-capacity anode material.

Unregistered Sales of Equity Securities

On December 8, 2025, the Company entered into an agreement with Anson Investments Master Fund LP ("Anson"), pursuant to which it issued 240,400 shares of common stock to Anson in exchange for the termination of all warrants and other obligations of the Company under the Securities Purchase Agreement, dated as of August 30, 2024. Further, Anson agreed to limit sales of common stock to no more than 10% of the daily trading volume on the Nasdaq Stock Market of all of the Company's common stock. On February 5, 2026, the Company issued the 240,400 shares of its common stock to Anson pursuant to this agreement. The issuance was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act. No underwriting discounts or commissions were paid with respect to the issuance. See Note 14 - Subsequent Events for additional information.

Change to Board of Directors

On September 3, 2025 (the "Resignation Date"), Cynthia Ekberg Tsai notified the Board of Directors (the "Board") of the Company of her resignation as a member of the Board, including all committees on which she serves, effective as of the Resignation Date. Ms. Ekberg Tsai's resignation did not result from any disagreement with the Company on any matter relating to the Company's operations, policies or practices.

As a result of Ms. Ekberg Tsai's resignation, the Company's Audit Committee is composed of two members. On September 8, 2025, the Company notified The Nasdaq Stock Market, LLC of its non-compliance with Nasdaq Rule 5605(c)(2)(A), which requires that the Audit Committee be composed of three directors. Pursuant to Nasdaq Listing Rule 5605(c)(4), the Company has a cure period to regain compliance by appointing a new independent director to the Audit Committee. The cure period extends until the earlier of the Company's next annual shareholders' meeting or September 3, 2026; provided, however, that if the annual shareholders' meeting occurs no later than March 2, 2026, the Company has until March 2, 2026, to regain compliance. The Company intends to appoint a new independent director to the Audit Committee as soon as practicable within the cure period.

On March 24, 2026, the company announced an annual meeting scheduled for June 11, 2026. As a result, the Company's cure period to regain compliance with Nasdaq Listing Rule 5605(c)(2)(A) extends until the date of the annual meeting. The Company is actively evaluating potential candidates to fill the vacancy on its Audit Committee and intends to regain compliance within the applicable cure period.

Components of Results of Operations

Revenue

The Company is focused on commercializing and manufacturing battery materials and next-generation battery cells. Historically, and during the periods presented, we have generated minimal revenue from product samples. We do not expect to begin generating significant revenue until we complete the commercialization process and build out manufacturing capacity. Future capacity may come from joint ventures with strategic partners, sourcing third-party manufacturing from our network, or pursuing mergers and acquisitions.

Operating Expenses

Research and Development

Research and development expenses consist primarily of personnel expenses, including salaries, benefits, third party technology validation testing, equipment, engineering, maintenance of facilities, data analysis, and materials.

Selling, general and, administrative

Selling, general and administrative expenses primarily consist of personnel expenses, including salaries, benefits, and stock-based compensation related to executive management, finance, legal, and human resource functions. Other costs include business development, contractor and professional services fees, audit and compliance expenses, insurance costs and general corporate expenses, such as rent, office supplies and information technology costs.

Other Income (Loss)

Change in fair value of Derivative Liabilities

Change in fair value of Derivative Liabilities consists of fluctuations in the fair value of an agreement between the Company and investors facilitating future purchases of the Company's stock by the Investor based on a Monte Carlo simulation model.

Interest Income

Interest income is derived from the Company's operating cash account, which is periodically invested in short-term money market funds.

Interest Expense

Interest expense consists primarily of the interest on the Company's short-term notes and D&O insurance premium financing arrangement.

Results of Operations

This data should be read in conjunction with Solidion's financial statements and accompanying notes. These results of operations are not necessarily indicative of future performance.

Summary of Statements of Operations for the Three Months Ended March 31, 2026 and 2025

		For the Three Months Ended March 31,
		2026				2025 (Restated)
Net sales		$	85,426			$	-
Cost of goods sold			1,696				-
Operating expenses			1,858,023				3,132,669
Total other income			343,625				12,327,299
Net (loss) income		$	(1,430,668	)		$	9,194,630

Operating Expenses

Operating expenses decreased by $1,274,646 for the three months ended March 31, 2026. This decrease was primarily driven by lower general and administrative costs, including reduced personnel and professional services expenses. Additionally, there were decreased research and development costs, including personnel expenses associated with the commercialization of our battery cell products and third-party validation testing of our proprietary silicon anode.

Other Income (Expense)

Other income decreased by $11,983,674 for the three months ended March 31, 2026. This increase was largely driven by a gain of $561,350 due to a change in the fair value of derivative liabilities related to the Forward Purchase Agreement and warrants related to the March private placement financing, compared to a gain of $12,417,450 in the three months ended March 31, 2025. Additionally, there was interest expense of $147,233 primarily related to the Company's short-term notes.

Cash Flows

The following tables set forth a summary of our cash flows for the periods indicated

		For the Three Months Ended March 31,
		2026				2025
Net cash provided by (used in):
Operating Activities			(141,863	)			(2,342,278	)
Investing Activities			(23,975	)			(40,156	)
Financing Activities			-				198,875
Net decrease in cash			(165,838	)			(2,183,559	)

Net Cash used in Operating Activities

For the three months ended March 31, 2026, cash used in operating activities was $141,863. This primarily resulted from net loss of $1,430,668, which included non-cash gain of $561,350 due to a change in the fair value of derivative liabilities related to the Forward Purchase Agreement and March Private Placement warrants. These non-cash gains were added back to reconcile net income to net cash used in operating activities, as part non-cash adjustments that also included depreciation and amortization, stock-based compensation and amortization of debt discount, totaling $186,186. Additionally, changes in operating assets and liabilities used $1,399,991 of cash from operating activities, driven primarily by a $2,043,286 increase in accounts payable and accrued expenses. The increase in accounts payable and accrued expenses was mainly due to higher accrued expenses linked to capital raising.

For the three months ended March 31, 2025, cash used in operating activities was $2,342,278. This primarily resulted from net income of $9,194,630, which included non-cash gain of $12,417,450 due to a change in the fair value of derivative liabilities related to the Forward Purchase Agreement and March and August Private Placement warrants. These non-cash gains were added back to reconcile net income to net cash used in operating activities, as part non-cash adjustments that also included depreciation and amortization, stock-based compensation non-cash interest expense, totaling $11,502,027. Additionally, changes in operating assets and liabilities used $34,881 of cash from operating activities, driven primarily by a $607,376 increase in other current assets. The increase in other current assets was due to the financing arraignment associated with the directors and officers' insurance policy.

Net Cash used in Investing Activities

For the three months ended March 31, 2026, the Company used cash of $23,975 in investing activities consisting of capitalized patent costs.

For the three months ended March 31, 2025, the Company used cash of $40,156 in investing activities consisting of capitalized patent costs.

Net Cash provided by Financing Activities

For the three months ended March 31, 2026, the Company did not generate cash from financing activities.

For the three months ended March 31, 2025, the Company generated cash of $198,875 from financing activities. The Company received proceeds from warrant exercises of $241,546. These increases were offset by repayment of short-term notes of $42,671.

Going Concern Considerations, Liquidity and Capital Resources

Since Solidion's inception, the Company has experienced recurring net losses and has generated minimal sales. This raises substantial doubt about the Company's ability to continue as a going concern. Management's ability to fund our operations and capital expenditures depends on our ability to raise additional external capital. This is subject to our future operating performance and general economic, financial, competitive, legislative, regulatory, and other conditions, some of which are beyond our control. We are currently engaged in discussions with various financing counterparties to secure sufficient capital to meet our business needs for the foreseeable future. The Company plans to finance its operations with proceeds from the sale of equity securities, government grants and loans, or debt; however, there is no assurance that management's plans to obtain additional debt, grants or equity financing will be successfully implemented or implemented on terms favorable to the Company.

As of March 31, 2026, we had an accumulated deficit of $164,803,207. Additionally, $1,114,594 in NUBI transaction costs incurred at the Closing Date in connection with the Merger remain outstanding and are due within the next twelve months. During the three months ended March 31, 2026, we incurred losses from operations totaling $1,774,293 and net cash used in operating activities of $141,863. We expect to continue to incur such losses for at least the next twelve (12) months.

Off-Balance Sheet Arrangements

At March 31, 2026, we have no obligations, assets or liabilities which would be considered off-balance sheet arrangements. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements.

We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or entered into any non-financial agreements involving assets.

Critical Accounting Estimates

We prepare our financial statements in accordance with U.S. generally accepted accounting principles, which require our management to make estimates that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the balance sheet dates, as well as the reported amounts of revenues and expenses during the reporting periods. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations would be affected. We base our estimates on our own historical experience and other assumptions that we believe are reasonable after taking account of our circumstances and expectations for the future based on available information. We evaluate these estimates on an ongoing basis.

We consider an accounting estimate to be critical if: (i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates that we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations. There are items within our financial statement that require estimation but are not deemed critical, as defined above. There were no changes to the Company's critical accounting estimates from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2025.

Forward Purchase Agreement

The Company accounts for the forward purchase agreement as either equity-classified or liability-classified instruments based on an assessment of the Forward Purchase Agreement ("FPA") specific terms and applicable authoritative guidance under FASB ASC 815, "Derivatives and Hedging" ("ASC 815"). The assessment considers whether the FPA meets all of the requirements for equity classification under ASC 815, including whether the FPA is indexed to the Company's own common shares and whether the FPA holders could potentially require "net cash settlement" in a circumstance outside of the Company's control, among other conditions for equity classification. This assessment is conducted at the time of FPA issuance and as of each subsequent quarterly period end date while the FPA is outstanding.

The Company has determined that the FPA does not meet all of the criteria for equity classification under ASC 815, as the FPA fails the fixed-for-fixed test under ASC 815-40 due to the bi-weekly Reset Price mechanism, the Dilutive Offering Reset provision, and the VWAP Trigger Event, each of which creates variability in the settlement amount that is not purely a function of the Company's own stock price. Accordingly, the FPA is classified as a liability-classified derivative instrument, recorded at fair value on the date of issuance and remeasured at fair value at each balance sheet date thereafter. The Company utilizes a Monte Carlo simulation model to determine the fair value of the FPA. The resulting fair value is recorded as a derivative liability on the condensed consolidated balance sheets. The Company records changes in the fair value of the FPA as a non-cash other income (expense) within change in fair value of derivative liabilities account on the Company's condensed consolidated statements of operations.

Upon the issuance of shares in connection with the FPA, the Company recognizes (i) an increase to APIC measured at the fair value of the FPA at the time of share issuance, (ii) a corresponding stock subscription receivable of equal amount as a contra-equity component within stockholders' equity (deficit), representing the present value of the consideration receivable for the shares issued, and (iii) a loss on issuance of common stock within Other Income (Expense) representing the difference between the face value of the stock subscription receivable and its present value at the issuance date. The discount between the face value and present value of the stock subscription receivable is accreted using the effective interest method over the remaining term of the FPA, with each period's accretion recorded as an increase to both the stock subscription receivable and APIC within stockholders' equity (deficit). The stock subscription receivable is presented as a reduction to total stockholders' equity (deficit) and is relieved as Optional Early Termination proceeds are received from the Forward Purchase Investor.

For issued or modified FPA that meet all of the criteria for equity classification, the FPA is required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified FPAs that do not meet all of the criteria for equity classification, the FPA are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. The Company accounts for outstanding FPA as liability-classified instrument.

The fair value of the FPA is Level 3. The determination of the fair value requires significant estimates and judgments. See Note 13 - Fair Value Measurements to the financial statements for the significant assumptions and estimates.

Changes in the significant assumptions and estimates could materially impact the valuation and the amounts recorded in the financial statements.

Recently Issued Accounting Standards

In November 2024, the FASB issued ASU 2024-03, "Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses" to improve disclosures by providing more detailed information about the types of expenses in commonly presented expense captions. The guidance is effective for annual reporting periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the effect this standard will have on its condensed consolidated financial statements and related disclosures.

In December 2025, the FASB issued ASU 2025-10, "Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities," which establishes comprehensive guidance under U.S. GAAP for the recognition, measurement, presentation, and disclosure of government grants received by business entities. The ASU is effective for public business entities for annual reporting periods beginning after December 15, 2028, and interim reporting periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating the effect this standard may have on its condensed consolidated financial statements and related disclosures in light of its government contract revenue activity.