TeraWulf Inc. (WULF) | The Buildout — AI Infrastructure
The Verdict
TeraWulf builds and operates data center campuses sized for high-performance computing and leases the capacity on long terms. Its pitch is power: it acquires sites with existing or contracted electrical service, converts them into liquid-cooled facilities, and signs long-duration leases with credit-enhanced customers. In a market where management says the binding constraint is power, transmission and interconnection rather than demand, owning the power pathway is the product.
| Market Cap | — |
| Revenue (TTM) | $165M |
| Revenue Growth | +14.6% |
| EBITDA Margin (TTM) | -161.4% |
| Net Debt | $2.6B |
| Earnings Beats | 0 of 7 |
| P/E (TTM) | — |
| EV/EBITDA (TTM) | — |
What We Like
- HPC lease revenue grew from $9.7M in Q4 2025 to $31.9M in Q2 2026, reaching ~71% of total revenue from ~62% in Q1 2026.
- The Anthropic lease adds ~$19B of contracted revenue over an initial 20-year term for ~401 MW at the Justified Data campus.
- $600M of Google credit support for FluidStack's lease obligations became effective when CB-3 was delivered.
- Cash and restricted cash totaled ~$3.0B at June 30, 2026, with parent unrestricted liquidity ~$1.45B including the initial $250M Abernathy payment.
- The FluidStack lease amendments are expected to add >$500M of incremental lease revenue, of which >$300M is tied to a ~$150M tenant fit-out contribution.
What We’re Watching
- CB-5's first data hall energization slipped to very early January 2027 from a prior Q4 2026 delivery target.
- WULF Compute project cost is now estimated at ~$9.1M per critical IT MW, up from ~$8.6M/MW financed in October 2025 but inside the original $8-10M guidance.
- The investment-grade credit supporting the Hawesville lease is unnamed; management repeated the phrase without identifying the counterparty.
- The incremental 250 MW Lake Mariner interconnect update and the 480 MW H2 2027 Justified online target both went silent on the Q2 call.
The contracting side strengthened materially this window — a 20-year direct Anthropic lease, effective Google credit support, and a ~$530M capital-recycling exit came alongside reaffirmed multi-year targets. The earnings side has not followed yet: non-GAAP adjusted EBITDA worsened sequentially and reported HPC segment margin sits far below target. The open question is whether margin converges as CB-4 and CB-5 enter service, and whether the ~$9.1M per MW estimate holds.
Earnings
Q2 2026 revenue was $44.8M, up from $34.0M in Q1, with gross margin of 72.3%. HPC lease revenue was the standout at $31.9M, up 52% quarter-over-quarter and about 71% of total. The HPC leasing segment printed a ~28% reported margin — roughly 80% adjusted for tenant fit-out, pre-revenue WULF Compute costs and uncontracted development costs — against a ~85% long-term target.
| Metric | Q2 FY2026 | Q1 FY2026 | Q2 FY2025 | YoY |
|---|---|---|---|---|
| Revenue | $45M | $34M | $48M | −5.9% |
| Gross margin | 72.3% | 93.1% | 53.6% | +1870bps |
| EBITDA | −$117M | −$106M | $9M | −1347.9% |
| EPS | $-1.94 | $-1.01 | $-0.05 | +3969.1% |
| HPC lease revenue | $31.9M | $21.0M | n/a | — |
| Revenue-generating critical IT capacity, Lake Mariner | 102 MW | 60 MW | n/a | — |
HPC lease revenue increased 52% quarter-over-quarter to $31.9 million from $21.0 million and represented approximately 71% of total revenue— Patrick Fleury, CFO, August 5, 2026
Management tone: Management escalated its quarter framing from "execution" in Q1 to "execution and expansion" in Q2. It named its own CB-5 schedule slip and quantified the tenant fit-out change orders behind it, saying CB-3 alone carried about 43 fit-out requests. On the credit question it repeated that "the Hawesville lease will be supported by an investment-grade credit" without naming the provider, and it did not size the total pipeline — management said it did not have an answer on total pipeline size.
Management Guidance
Management reaffirmed its 250-500 MW annual contracted capacity target and its FY2026 adjusted SG&A guidance of $75-100M, and held the long-term HPC segment margin target at ~85% and the mid-teens yield on cost. WULF Compute's cost estimate sits within the original $8-10M per critical IT MW guidance. CB-4's first data hall is targeted for lease revenue in late September 2026 and CB-5's for energization in very early January 2027. Management said it expects to return to the debt capital markets for Hawesville and, likely in the first half of 2027, for Muskie, and said near-term commitments are fundable without the equity capital markets.
Trajectory
Total revenue has been lumpy: $50.6M in Q3 2025, $35.8M in Q4 2025, $34.0M in Q1 2026 and $44.8M in Q2 2026, as legacy bitcoin mining ran down and HPC capacity started coming online. The mix has rotated sharply — HPC lease revenue went from $9.7M in Q4 2025 to $21.0M in Q1 2026. The code-computed signals read revenue as decelerating on the trailing quarters, with operating and EBITDA margins compressing as pre-revenue and development costs are carried ahead of contracted capacity. Reported gross margin is expanding on a multi-quarter view but is distorted by demand response proceeds, which fell to $2.8M in Q2 from $14.1M in Q1.
The Model
The model projects FY+1 revenue of $197M and EBITDA of negative $252M, a -128% margin. For FY+2 it projects revenue of $596.8M and EBITDA of $193M, a 32.4% margin. The near term reflects capacity still being built against pre-revenue and development costs; FY+2 reflects contracted HPC leases at Lake Mariner, Justified Data and beyond converting into revenue.
| Metric | FY2025 | Next FY (E) | Following FY (E) |
|---|---|---|---|
| Revenue | $168M | $197M | $597M |
| YoY Growth | — | +17.0% | +202.9% |
| EBITDA | −$77M | −$252M | $193M |
| EBITDA Margin | -45.8% | -128.0% | 32.4% |
Projections are the median of 5 independent model runs.
Management reaffirmed its 250-500 MW annual contracted capacity target and its FY2026 adjusted SG&A guidance of $75-100M, and held the long-term HPC segment margin target at ~85% and the mid-teens yield on cost. WULF Compute's cost estimate sits within the original $8-10M per critical IT MW guidance. CB-4's first data hall is targeted for lease revenue in late September 2026 and CB-5's for energization in very early January 2027. Management said it expects to return to the debt capital markets for Hawesville and, likely in the first half of 2027, for Muskie, and said near-term commitments are fundable without the equity capital markets.
What Could Go Right — and Wrong
- CB-4 and CB-5 enter service on the stated schedules, adding contracted HPC lease revenue at Lake Mariner.
- Reported HPC segment margin progresses toward the ~85% long-term target as pre-revenue and uncontracted development costs roll off.
- Muskie signs its first customer and formalizes an expansion toward 2 GW.
- The Hawesville lease's investment-grade credit support is confirmed with terms disclosed.
- A direct lease with a large investment-grade hyperscaler diversifies the tenant base beyond FluidStack, Core42 and Anthropic.
- Further schedule slippage delays HPC lease revenue recognition at Lake Mariner or Justified Data.
- WULF Compute cost per MW rises above the $8-10M band, pressuring the mid-teens yield on new capacity.
- Electrical labor constraints raise construction cost or slow commissioning across the portfolio.
- Financing conditions tighten for the planned Hawesville and Muskie project debt.
- The Fluor EPC contract for the Kentucky campus is not finalized on the terms management expects.
Looking Ahead
The next twelve months turn on delivery. CB-4's first data hall is targeted for lease revenue in late September 2026 and CB-5's for energization in very early January 2027, the two steps that should lift HPC lease revenue again. Muskie is in active commercialization, and management expects to return to the debt capital markets for Hawesville and, likely in the first half of 2027, for Muskie. Justified Data's 480 MW online target points to H2 2027, and the Chesapeake/Morgantown acquisition still needs its remaining closing conditions and consents after FERC authorization.
- Late September 2026CB-4 first data hall revenue — Tests the commissioning pipeline and starts the CB-4 revenue ramp.
- On or before December 31, 2026Abernathy sale second payment — $150M due; tests the capital-recycling claim.
- Very early January 2027CB-5 first data hall energization — The revised schedule's first checkpoint after slipping from Q4 2026.
- First half of 2027Muskie project debt financing — Tests project-finance appetite for the 1 GW Kentucky campus.
- On or before April 30, 2027Abernathy sale third payment — ~$130M due, completing the ~$530M in sale proceeds.
- H2 2027Justified Data 480 MW online — A target reaffirmed in Q1 but not repeated on the Q2 call.
Financials
Annual Summary
| Metric | FY2024 | FY2025 | TTM | YoY |
|---|---|---|---|---|
| Revenue | $140M | $168M | $165M | +20.2% |
| Gross Margin | 54.1% | 48.9% | 69.3% | 525bps |
| EBITDA | −$15M | −$77M | −$267M | -411.3% |
| EBITDA Margin | -10.8% | -45.8% | -161.4% | 3,507bps |
| Net Income | −$72M | −$662M | −$1.9B | -813.7% |
| Free Cash Flow | −$292M | −$1.2B | −$2.5B | — |
| Net Cash | — | — | — | — |
Key Ratios (Trailing)
- P/E TTM—
- EV/EBITDA TTM—
- EV/Revenue TTM—
- Price/FCF TTM—
- Gross Margin (TTM)69.3%
- EBITDA Margin (TTM)-161.4%
- Net Margin (TTM)-1179.9%
- ROIC-10.8%
- SBC / Revenue95.3%
The Company
TeraWulf builds and operates data center campuses designed for high-performance computing, then leases the capacity on long terms to AI compute platforms and frontier AI labs. Its product is "critical IT capacity" measured in megawatts, and its selling point is power: the company acquires sites with existing or contracted electrical service and converts them into liquid-cooled facilities. Management describes power as a core asset rather than an input cost, and says the binding constraint on AI infrastructure is power, transmission and interconnection, not demand.
The company describes itself as vertically integrated: it acquires and owns the sites, controls the power pathway, and builds and operates the campuses. It runs two reportable segments — an HPC Platform and legacy bitcoin mining it intends to exit by the next halving. Named sites across the record include Lake Mariner in Barker, New York, on the site of a former coal-fired power plant; Justified Data in Hancock County, Kentucky; Muskie in Eastern Kentucky; Chesapeake/Morgantown in Maryland; and Cayuga in Lansing, New York.
Business Segments
Competitive Landscape
TeraWulf's 10-K says it competes with data center REITs, independent data center developers, hyperscalers, infrastructure funds and, in certain cases, digital asset miners with infrastructure suitable for HPC conversion. Management argues that deliverable power, capital and execution credibility — not a queue position — separate winners.
Supply Chain
TeraWulf sits between power and construction suppliers on one side and AI compute tenants on the other. It buys EPC and electrical work, utility service and data center equipment, and sells long-duration critical IT capacity.
More on WULF: Earnings recap