WULF

1. Key Historical Highlights

• August 22, 2025: Completed full exercise of the greenshoe option in the 1.00% Convertible Senior Notes due 2031, increasing the total offering to $1.0 billion.
• August 18, 2025: Fluidstack exercised its option to add the 160 MW CB-5 facility at Lake Mariner, with operations expected in the second half of 2026.
• August 18, 2025: Priced and upsized a private offering of $850 million of 1.00% Convertible Senior Notes due 2031 with capped calls to mitigate dilution.
• August 14, 2025: Signed two 10-year HPC colocation agreements with Fluidstack representing over 200 MW and approximately $3.7 billion in contracted revenue.
• August 14, 2025: Secured an 80-year ground lease at the Cayuga site enabling up to 400 MW of digital infrastructure with 138 MW power ready in 2026.
• August 14, 2025: Reported Q2 2025 revenue of $47.6 million and a six‑month net loss of $79.8 million while accelerating the pivot to HPC hosting.
• August 08, 2025: Posted Q2 2025 revenue of $47.6 million and adjusted EBITDA of $14.5 million and guided to begin recognizing HPC hosting revenue in Q3 2025.
• May 27, 2025: Acquired Beowulf Electricity & Data LLC for approximately $52.4 million to simplify the corporate structure and integrate the workforce.
• May 09, 2025: Announced Q1 2025 results with $34.4 million revenue, $(4.7) million adjusted EBITDA, and $33 million of share repurchases.
• May 05, 2025: Disclosed a Q1 2025 net loss of $61.4 million and a $66,156 cost to mine one bitcoin amid higher energy costs and the 2024 halving.
• March 03, 2025: Reported 2024 revenue of $140.1 million and a net loss of $72.4 million while preparing to expand HPC hosting capacity.
• February 28, 2025: Closed an oversubscribed $500 million 2.75% convertible notes due 2030 and executed over $150 million of share repurchases under a $200 million program.
• January 03, 2025: Finalized data center leases exceeding 70 MW with Core42 representing more than $1 billion in potential revenue over initial 10-year terms.
• December 23, 2024: Announced long-term data center lease agreements with Core42 to deliver over 70 MW at Lake Mariner with options for an additional 135 MW.
• November 21, 2024: Promoted Sean Farrell to Chief Operating Officer to support rapid expansion in HPC and AI compute infrastructure.
• November 12, 2024: Reported Q3 2024 revenue of $27.1 million, sold the 25% Nautilus JV stake, and completed a 2.5 MW HPC proof-of-concept.
• October 25, 2024: Closed a $500 million 2.75% Convertible Senior Notes offering and entered capped call transactions.
• October 23, 2024: Authorized a $200 million share repurchase program running through December 31, 2025.
• October 10, 2024: Entered a new long-term ground lease at Lake Mariner expanding land to 157 acres with exclusive access to up to 750 MW of infrastructure capacity.
• October 03, 2024: Sold the 25% equity interest in the Nautilus joint venture for approximately $92 million to fund HPC and mining expansion.

2. Financial Performance Overview

• Revenue inflected from $69.2 million in 2023 to $140.1 million in 2024, then dipped to $34.4 million in Q1 2025 before rebounding to $47.6 million in Q2 2025, with first HPC hosting revenue slated for Q3 2025 (Gap: no quantified 2H 2025 revenue guidance).
• Profitability compressed as adjusted EBITDA fell from $60.4 million in 2024 to $(4.7) million in Q1 2025 before improving to $14.5 million in Q2 2025, with management pointing to high-margin HPC hosting ahead (Gap: audited HPC margin data not provided).
• Bitcoin mining unit economics deteriorated post‑halving and on higher power costs, with cost to mine rising from $25,268 in 2024 to $66,156 in Q1 2025, highlighting the importance of mix-shifting to HPC.
• Liquidity and capital access strengthened via $500 million 2.75% converts due 2030 (October 2024) and $1.0 billion 1.00% converts due 2031 (August 2025), plus capped calls to reduce dilution; cash and bitcoin holdings were $275 million at December 31, 2024.
• Capital deployment balanced growth and return: over $150 million of repurchases in 2024 and $33 million in Q1 2025, while committing large-scale capex for HPC expansion anchored by multi‑year contracts (Gap: detailed capex phasing and funding schedule not fully disclosed).
• Contracted revenue visibility expanded from >$1 billion with Core42 to ~$3.7 billion initial with Fluidstack, and later to $6.7 billion contracted with potential to $16 billion including extensions, supported by a multibillion‑dollar Google backstop.

3. Management Effectiveness

• Executed a strategic pivot toward HPC by securing multi‑year, high‑visibility leases with Core42 and Fluidstack, reducing reliance on volatile bitcoin mining cash flows.
• Demonstrated sophisticated capital markets execution with low‑coupon convert issuances and capped calls while concurrently repurchasing stock, signaling confidence and managing dilution.
• Optimized the asset base by monetizing the Nautilus JV at an estimated 3.4x return and acquiring Beowulf E&D to simplify governance, enhance transparency, and streamline operations.
• Secured long‑dated, scalable, low‑cost power and land through Lake Mariner and Cayuga leases, positioning the platform for 500–750 MW at Lake Mariner and up to 400 MW at Cayuga.
• Execution cadence remains on schedule for HPC deliveries (72.5 MW in 2025 and expanded milestones into 2026), though Evidence lacking: third‑party validation of construction timelines and cost-to-complete.
• Risk posture improved via demand response participation and customer backstops, but exposure to power pricing and bitcoin volatility persists; Evidence lacking: detailed sensitivity analyses and HPC contract margin disclosures.

4. Key Quotes from Management

• "This is a defining moment for TeraWulf; we are proud to unite world-class capital and compute partners to deliver the next generation of AI infrastructure, powered by low-cost, predominantly zero-carbon energy, and this transaction underscores Lake Mariner’s status as a premier hyperscale-ready campus and further accelerates our strategic expansion into high-performance compute." — Paul Prager, Chief Executive Officer, TeraWulf (Signing of AI Hosting Agreements with Fluidstack, August 14, 2025)
• "TeraWulf continues to execute on its strategy to develop scalable, sustainable digital infrastructure to support both high-performance computing (HPC) hosting and proprietary Bitcoin mining." — Paul Prager, Chief Executive Officer, TeraWulf (Second Quarter 2025 Financial Results, August 08, 2025)
• "We’ve made meaningful progress on each of these fronts; in late Q1 and early Q2, we energized Miner Building 5, bringing total capacity at Lake Mariner to 245 MW, and we remain on track to deliver the Core42 deployment this year while initiating financing to support our next phase of HPC growth." — Paul Prager, Chief Executive Officer, TeraWulf (First Quarter 2025 Financial Results Announcement, May 09, 2025)
• "Our strategic relationship with G42, and most specifically with Core42, positions TeraWulf at the intersection of two of today’s most transformative computational networks: AI compute and Bitcoin mining." — Paul Prager, Chief Executive Officer, TeraWulf (Announcement of Data Center Lease Agreements with G42, December 23, 2024)
• "We have taken decisive steps to strengthen our balance sheet, including fully retiring our debt earlier this year, while making substantial progress in executing our business strategy." — Paul Prager, Chief Executive Officer, TeraWulf (Authorization of Share Repurchase Program, October 23, 2024)
• "This transaction further aligns TeraWulf’s focus and investments with where we have the most operational efficiency, the greatest growth potential, and the best opportunity to drive incremental value for shareholders." — Paul Prager, Chief Executive Officer, TeraWulf (Monetization of Equity Interests in Nautilus Joint Venture for Expansion of HPC/AI and Bitcoin Mining, October 03, 2024)
• "This expansion underscores the unmatched scale and capabilities of the Lake Mariner campus." — Paul Prager, Chief Executive Officer, TeraWulf (TeraWulf Announces Fluidstack Expansion with 160 MW CB-5 Lease at Lake Mariner, August 18, 2025)