Bit Digital, Inc. (BTBT) | The Buildout — AI Infrastructure
The Verdict
Bit Digital describes itself as a strategic asset company with two pillars: an Ethereum treasury it stakes, and — through its majority stake in WhiteFiber — an AI data-center business. WhiteFiber sells GPU cloud compute and leases powered colocation space to AI and HPC customers, and that is where the buildout exposure sits. The company says it is winding down its Bitcoin mining segment, so reported revenue increasingly reflects the AI infrastructure business rather than crypto mining.
| Market Cap | — |
| Revenue (TTM) | $123M |
| Revenue Growth | −20.9% |
| EBITDA Margin (TTM) | -25.2% |
| Net Debt | $346M |
| Earnings Beats | 0 of 7 |
| P/E (TTM) | — |
| EV/EBITDA (TTM) | — |
What We Like
- Contract liabilities nearly doubled to $143.1M from $79.6M at year-end — cash collected for services not yet delivered.
- Remaining performance obligations of roughly $1B, with $136.7M scheduled for 2027 alone — more than all of FY2025 revenue of $113.6M.
- Cloud services grew 42% sequentially at a 58% gross margin, after a 13.1% sequential decline in Q1 2026.
- More than $500M of new WhiteFiber contracts signed in the quarter; WhiteFiber itself cites more than $540M, including next-generation GPU deployments.
- H1 2026 operating cash flow of $46.8M, up 33% from $35.1M in the same period last year.
What We’re Watching
- NC-1 permanent project financing has not closed; WhiteFiber says the process 'has taken longer than we initially anticipated.' Closing it would release the ETH collateral and terminate the guarantee.
- The unnamed 'Initial Customer' was 70.7% of FY2025 revenue, and the 10-Q says WhiteFiber and that customer are in discussions about a 'potential resolution of the existing service agreements.'
- Reported losses are dominated by non-cash items: the Q2 2026 net loss of $107M included about $86M from digital-asset marks, derivative revaluation and interest expense.
- The at-the-market program allows up to $500M of share sales; 22,761,994 shares were sold after March 31, 2026 for about $34.6M gross.
The thesis is strengthening on operations and unresolved on financing. Revenue inflected from a 13.7% sequential decline in Q1 2026 to 15% growth in Q2 2026, cloud gross margin held near 58-59% through a major capacity ramp, and the contracted book was disclosed for the first time. But the largest forward items — NC-1 permanent financing, the buyback, covered calls, and the acquisition — are stated intentions, not delivered outcomes. The open question is whether NC-1 converts the contracted backlog into reported revenue on the promised schedule.
Earnings
Q2 2026 revenue was $32.1M, up 15% sequentially from $27.9M and bringing H1 revenue to $60M, up 18% year over year. Gross margin was 57.9%. Cloud services led with $23.8M, up 42% sequentially at a 58% gross margin; colocation was $4.7M, essentially flat. The net loss attributable to shareholders was $107M, including about $86M of non-cash digital-asset, derivative and interest items.
| Metric | Q2 FY2026 | Q1 FY2026 | Q2 FY2025 | YoY |
|---|---|---|---|---|
| Revenue | $32M | $28M | $26M | +24.9% |
| Gross margin | 57.9% | 20.7% | 16.6% | +4130bps |
| EBITDA | −$5M | −$12M | −$6M | −16.9% |
| EPS | $-0.31 | $-0.45 | $0.07 | −529.2% |
| Contract liabilities | $143.1M | $79.6M (year-end 2025) | n/a | nearly doubled from year-end |
| Remaining performance obligations | ~$1B | n/a | n/a | — |
remaining performance obligations were approximately $1 billion at quarter-end.. the 2027 figure alone is more than we earned in all of 2025. None of it appeared in the revenue line today.— Erke Huang, CFO, 2026-08-13
Management tone: Management's framing shifted from a strategic-asset transition on the Q1 2026 call to a capital-allocation quarter on Q2 2026. The capital-allocation discussion moved away from external M&A toward the company's own securities — a possible buyback and out-of-the-money covered calls on a limited portion of the WhiteFiber holding. Management disclosed contract liabilities and the RPO schedule for the first time and reaffirmed it does not intend to sell WhiteFiber shares in 2026. It declined to give buyback timing, ATM pricing, or a specific trigger for issuing versus buying back shares.
Management Guidance
Bit Digital issues no formal financial guidance. Its guide-like disclosures are operational and contractual. Management said NC-1 is expected to begin contributing revenue in Q3 2026, with full contracted run-rate billing expected in August 2026 under a 10-year agreement representing roughly $865M of contracted revenue. The company expects to recognize roughly $57.7M of RPO across the balance of 2026, $136.7M in 2027, and $105.1M in 2028, with the remainder thereafter. The WhiteFiber bridge is described as 90 days to about half a year, repayable once NC-1 permanent financing closes.
Trajectory
Reported revenue has been range-bound for three quarters — $32.3M in Q4 2025, $27.9M in Q1 2026, and $32.1M in Q2 2026 — while the contracted book grew. The Q2 sequential inflection came from cloud services, which rose 42% at a 58% gross margin. Before depreciation, segment gross profit was 55.3% of Q1 2026 revenue; subtracting $10.0M of D&A from that quarter's segment gross profit gives 19.3%, and D&A scales with the build. Colocation was $4.7M in Q2 with NC-1 contributing nothing yet. The staking line fell to $0.9M from $2.3M, which the CFO ties to ETH price and to posting ETH as collateral for the WhiteFiber facility.
The Model
The model projects FY+1 revenue of $144.0M and EBITDA of -$25M, a -17.6% EBITDA margin. For FY+2 it projects revenue of $271.7M and EBITDA of $53M, a 19.35% margin. The near-term anchor is the contracted book converting as NC-1 begins billing; the FY+2 step assumes the colocation schedule and cloud contracts ramp toward the disclosed targets. The independent runs behind the median spanned $137M to $155M on FY+1 revenue (a 13% spread) and $261M to $325M on FY+2 (a 24% spread).
| Metric | FY2025 | Next FY (E) | Following FY (E) |
|---|---|---|---|
| Revenue | $114M | $144M | $272M |
| YoY Growth | — | +26.8% | +88.7% |
| EBITDA | −$15M | −$25M | $53M |
| EBITDA Margin | -13.2% | -17.6% | 19.4% |
Projections are the median of 4 independent model runs. The model’s revenue sits 0.7% above analyst consensus.
Bit Digital issues no formal financial guidance. Its guide-like disclosures are operational and contractual. Management said NC-1 is expected to begin contributing revenue in Q3 2026, with full contracted run-rate billing expected in August 2026 under a 10-year agreement representing roughly $865M of contracted revenue. The company expects to recognize roughly $57.7M of RPO across the balance of 2026, $136.7M in 2027, and $105.1M in 2028, with the remainder thereafter. The WhiteFiber bridge is described as 90 days to about half a year, repayable once NC-1 permanent financing closes.
What Could Go Right — and Wrong
- NC-1 permanent project financing closes, releasing the ETH collateral, terminating the guarantee, and letting capital recycle into the next data center.
- NC-1 converts RPO to revenue on schedule, breaking the three-quarter flat revenue pattern.
- Cloud gross margin holds near 58-59% as the Base10, Paris-region and Prime Intellect contracts enter service.
- The largest customer relationship resolves constructively, preserving more than $50M of annualized revenue.
- ETH recovers above the roughly $3,045 average acquisition cost, reversing fair-value losses and rebuilding the collateral cushion.
- NC-1 permanent financing slips past the bridge window, leaving the ETH collateral posted and a margin call a live scenario.
- The largest customer's 'potential resolution' turns out to be a reduction, hitting revenue and the RPO schedule directly.
- Revenue fails to convert at the promised pace: Q1 2026 recognized only $0.7M of the opening $79.6M contract-liability balance.
- D&A and interest outpace the revenue ramp — D&A was 36% of Q1 2026 revenue and interest expense rose 59% quarter over quarter in Q2.
- Continued ATM issuance works against the buyback thesis; the authorization is up to $500M.
Looking Ahead
The next twelve months turn on execution. NC-1 is expected to begin contributing revenue in Q3 2026, with full contracted run-rate billing targeted for August 2026, and permanent project financing expected toward the end of 2026. The board is evaluating a buyback and a covered-call registration described as potentially later in Q3 2026. WhiteFiber targets 76 MW (gross) of total data-center capacity by the end of Q4 2026 against a pipeline it describes as roughly 1,500 MW (gross) under management review.
- August 2026NC-1 run-rate billing — Full contracted billing under the 10-year agreement.
- Q3 2026NC-1 revenue contribution — First colocation revenue from the North Carolina flagship.
- Q3 2026Covered-call registration — Registration on a limited WhiteFiber stake; board approval required.
- End of 2026NC-1 permanent financing — Closing releases ETH collateral and repays the bridge.
- End of Q4 202676 MW capacity target — WhiteFiber's stated gross data-center capacity goal.
- 2027RPO recognition year — Scheduled recognition, more than all of FY2025 revenue.
Financials
Annual Summary
| Metric | FY2024 | FY2025 | TTM | YoY |
|---|---|---|---|---|
| Revenue | $164M | $114M | $123M | -30.7% |
| Gross Margin | 51.8% | 21.2% | 32.0% | 3,060bps |
| EBITDA | $60M | −$15M | −$31M | -124.8% |
| EBITDA Margin | 36.9% | -13.2% | -25.2% | 5,012bps |
| Net Income | $28M | −$80M | −$291M | -383.7% |
| Free Cash Flow | −$107M | −$575M | −$761M | — |
| Net Cash | — | — | — | — |
Key Ratios (Trailing)
- P/E TTM—
- EV/EBITDA TTM—
- EV/Revenue TTM—
- Price/FCF TTM—
- Gross Margin (TTM)32.0%
- EBITDA Margin (TTM)-25.2%
- Net Margin (TTM)-237.3%
- ROIC-8.0%
- SBC / Revenue30.1%
The Company
Bit Digital, Inc. describes itself as a strategic asset company. It holds Ethereum and stakes it through third-party validator operators, and it owns a majority stake in WhiteFiber Inc., which runs a high-performance computing business. Through WhiteFiber the company sells GPU cloud compute to AI and machine-learning customers and leases powered data-center capacity — power and space — to AI and HPC tenants. The 10-K says WhiteFiber designs, develops and operates data centers and provides cloud services for generative AI workstreams, especially training and inference.
WhiteFiber operates leased and owned sites in Iceland, Quebec, Georgia and North Carolina. Its flagship is NC-1 in Madison, North Carolina — a former Unifi Manufacturing building of roughly 1,000,000 leasable square feet that management believes can support up to 200 MW (gross) of electrical supply over time; the initial build is 40 MW. Other sites include Blönduós in Iceland, MTL-1, MTL-2 and MTL-3 in Quebec, and two leased cloud sites in Atlanta. The company consolidates WhiteFiber in full, with a portion attributable to noncontrolling interests, and is winding down its Bitcoin mining segment, which runs on third-party hosting.
Business Segments
Competitive Landscape
Bit Digital competes on two fronts. In cloud services and colocation, its 10-K names larger incumbents including CoreWeave, Crusoe Energy, Nebius and Lambda Labs on the cloud side, and Digital Realty, Equinix, NTT, CyrusOne, STACK Infrastructure, Aligned Data Centers and Iron Mountain in data centers. In Ethereum staking it names Sharplink Gaming, Bitmine Immersion Technologies and The Ether Machine, and in Bitcoin mining MARA Holdings, Riot Platform and CleanSpark as it winds that segment down.
- CoreWeaveNamed in filings as a cloud-services competitor; not further discussed in the source material.
- Digital RealtyNamed in filings as a data-center competitor; not further discussed.
- EquinixNamed in filings as a data-center competitor; not further discussed.
- MARA HoldingsNamed in filings as a Bitcoin-mining competitor; the read-through notes MARA operates mining as a cash engine while Bit Digital winds its own down.
- CleanSparkNamed in filings as a Bitcoin-mining competitor; the read-through notes CleanSpark remains in pre-lease discussions for AI capacity.
Supply Chain
WhiteFiber buys GPU servers and builds powered data centers, sitting between equipment vendors and the AI and HPC customers that contract for compute and capacity. Its largest neighbors are much larger cloud and colocation operators.
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