A letter of intent is a preliminary written agreement that signals negotiating intent but creates no binding obligation to close. One now connects Rancho Cucamonga-based iPower Inc. (Nasdaq: IPW) to an unnamed prospective customer for dedicated GPU computing systems. The proposed initial deployment carries an expected equipment acquisition value of approximately $6 million, over an anticipated 36-month lease term, with the potential to reach approximately $60 million in aggregate contemplated contract value.
What the LOI actually covers
The proposed structure works like this: iPower, or a designated subsidiary, would acquire high-performance GPU systems, retain ownership of that hardware, and lease the equipment to the prospective customer for exclusive use at a mutually agreed data center. The company frames this as a way to generate lease revenue from company-owned hardware assets while giving customers access to dedicated computing capacity they would not need to buy outright.
The expansion figure of approximately $60 million in aggregate contemplated contract value includes the initial $6 million phase. It is not additive on top of it. That distinction matters when sizing the deal.
What was signed versus what is only projected
Chief Executive Officer Lawrence Tan said the signed LOI moves the company's AI hardware leasing strategy from preliminary customer interest to a specific potential transaction. He added that the company is now focused on equipment sourcing, financing, data center deployment, and negotiating definitive commercial terms.
That list is long because nothing beyond the LOI has been finalized. The press release states that final equipment specifications, lease payments, payment schedule, credit support, deployment arrangements, and operating expenses all remain subject to negotiation. The LOI is non-binding in its entirety, and neither party is obligated to proceed unless definitive agreements are negotiated and executed. iPower warns there can be no assurance the initial transaction or any contemplated expansion will be completed or generate revenue or profit.
Where the LOI fits iPower's AI pivot
iPower describes itself as a technology- and data-driven company with established e-commerce operations, now expanding toward AI infrastructure. The LOI follows the company's recently announced formation of a dedicated AI subsidiary focused on hardware leasing and potential compute resource distribution opportunities.
The $6 million figure is the proposed acquisition cost of the GPU systems in the first phase. It is not revenue, and it is not the value of any signed contract.