TeraWulf targets 250–500 MW annual HPC growth as it secures $3.2B financing and expands Google-backed joint ventures

Earnings Call Insights: TeraWulf Inc. (WULF) Q3 2025

MANAGEMENT VIEW

* Paul Prager, CEO, emphasized, "The third quarter was truly transformational for TeraWulf, both operationally and financially." He announced the execution of a 10-year, 360-megawatt IT load agreement with Fluidstack backed by Google at the Lake Mariner campus, projecting average annual revenue of approximately $670 million and annual net operating income of more than $565 million.
* Prager highlighted closing $3.2 billion in senior secured financing backed by Google, stating, "This transaction is a milestone for the broader industry, demonstrating a repeatable end-to-end development model."
* The company recorded its first high-performance computing (HPC) revenues with lease commencements at WULF Den and CB-1, and remains on track to deliver CB-2 near year-end.
* TeraWulf expanded its partnership with Fluidstack and Google with a joint venture to develop the Abernathy HPC campus in Texas, which adds 168 megawatts of new HPC capacity and expansion potential up to 600 megawatts.
* Prager announced, "We recently increased our annual target for new HPC signings from 100 to 150 megawatts per year to 250 to 500 megawatts per year."
* Patrick Fleury, CFO, stated, "The 3Q 2025 results reflect a strong contribution from our legacy Bitcoin mining operations and more importantly, the start of HPC Leasing segment revenues."

OUTLOOK

* Prager reported, "We remain on track to deliver CB-2 near year-end, subject, of course, to tenant fit-out requests, which will complete our delivery of 60 megawatts of critical IT for Core42."
* The company raised its annual HPC signing target to 250–500 megawatts, up from prior guidance of 100–150 megawatts, citing strong customer demand and pipeline advancements.
* Management indicated that the Abernathy joint venture offers embedded expansion potential, both on campus and across future projects with Fluidstack and Google.

FINANCIAL RESULTS

* Fleury reported, "In the third quarter of 2025, GAAP revenues increased 6% quarter-over-quarter to $50.6 million from $47.6 million in 2Q '25."
* The company recognized $7.2 million of HPC lease revenue at WULF Den and CB-1, with 22.5 megawatts of energized hosting capacity.
* TeraWulf self-mined 377 Bitcoin at Lake Mariner, a decrease compared to 485 Bitcoin mined in 2Q '25.
* GAAP cost of revenue, exclusive of depreciation, decreased by 22% to $17.1 million.
* Proceeds from demand response programs increased to $7.4 million from $3.1 million in the previous quarter.
* Operating expenses rose 28% to $4.5 million, and SG&A expense increased to $16.7 million, with adjusted SG&A at $12.3 million.
* Depreciation rose from $18.8 million to $26.5 million, including $7.8 million in accelerated depreciation.
* Net loss widened to $455 million from $18.4 million in Q2, attributed to a $424.6 million loss on warrant and derivative liabilities related to Google warrants and the 2031 convertible notes conversion feature.
* Non-GAAP adjusted EBITDA improved to $18.1 million from $14.5 million.
* Cash and restricted cash totaled $712.8 million with pro forma liquidity exceeding $1 billion after recent financings.

Q&A

* Mike Grondahl, Northland: Asked about new site acquisitions. Prager replied, "There are at least two sites that we're very, very close to sorting out. We're going for some regional diversity... I would not be surprised if by year-end, we announced at least one, possibly two additional sites."
* Grondahl: Inquired about HPC segment margins. Fleury explained, "The actual margin was about 72%. There -- in the operating expenses, there's about $700,000 of expense development expense at Cayuga. So if you back that out, you'll see that gets you to about an 82% margin for the quarter."
* Nick Giles, B. Riley: Questioned customer diversification. Prager responded, "I could not be happier with the credit quality of our customers...the key for us is credit quality...it's a little bit of a smaller universe."
* Giles: Asked about JV project accounting. Fleury clarified, "We own 51% of the JV."
* Dillon Heslin, ROTH: Sought clarity on power procurement. Prager stated, "We have an active dialogue with our customer base. ...we're constantly discussing with them what their needs are."
* Christopher Brendler, Rosenblatt: Inquired about Bitcoin mining hash rate. Fleury said, "We're running our sites for our HPC clients now...as we reposition the site...we're making some changes on the Bitcoin mining side."
* Stephen Glagola, JonesTrading: Asked about constraints on new capacity targets. Prager admitted, "There are...It takes a lot of time to really get to the bottom of these sites...But I'm very comfortable at 250 to 500."
* John Todaro, Needham: Asked about penalties for late delivery. Fleury explained, "There are pretty significant grace periods. ...In general, we have very minimal penalties for the first 30 to 90 days."
* Tim Horan, Oppenheimer: Questioned triggers for increased guidance. Khan stated, "Now we have a much better nuanced understanding of what's required for each one of those phases...that is a reflection both of our capacity capability...as well as the size of the demand."

SENTIMENT ANALYSIS

* Analysts maintained a positive and congratulatory tone, frequently praising management for securing significant deals and expanding partnerships, but also probed into margin variability, customer diversification, and execution risks.
* Management's tone was consistently confident and detailed during prepared remarks, illustrated by statements such as, "I'm convinced we have the right strategy, the right team and the right assets to continue this momentum well into '26 and beyond."
* In Q&A, management addressed concerns directly but occasionally referenced confidential details or deferred specifics, e.g., "I'm not going to tell you the specific ones because that's confidential to the lease."
* Compared to the previous quarter, both management and analysts appeared more confident, with the scale of transactions and pipeline progress driving a more bullish outlook.

QUARTER-OVER-QUARTER COMPARISON

* The current quarter saw the announcement of a new 10-year, 360-megawatt deal with Fluidstack backed by Google, compared to the previous quarter's 200-megawatt Fluidstack agreement.
* Revenue growth slowed from a 38% sequential increase in Q2 to 6% in Q3, but the company began recognizing HPC lease revenue for the first time.
* Net loss expanded sharply due to non-cash losses on derivative liabilities, while adjusted EBITDA continued to improve.
* The annual HPC signing target was raised from 100–150 megawatts to 250–500 megawatts, reflecting growing customer demand and a stronger pipeline.
* Management's tone shifted from a focus on executing initial agreements to scaling operations and expanding partnerships, while analysts’ questions increasingly centered on growth capacity, execution risk, and margin sustainability.

RISKS AND CONCERNS

* Management cited operational constraints and the need for disciplined site selection as key challenges.
* Analysts raised concerns about margin variability, execution risk for large-scale projects, and potential penalties for delayed delivery.
* Management’s mitigation strategies include strict criteria for site selection, expanding development teams, and maintaining active dialogues with key customers to ensure timely and efficient execution.

FINAL TAKEAWAY

TeraWulf delivered a transformative quarter, securing long-term, high-value contracts and industry-leading financing while expanding its partnership with Google and Fluidstack. The company raised its annual HPC growth target to 250–500 megawatts, citing robust customer demand and an advanced development pipeline. Management remains focused on disciplined execution and thoughtful expansion, underscored by strong liquidity and a deepening roster of blue-chip clients, as it continues to scale its platform for the next phase of AI infrastructure growth.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/wulf/earnings/transcripts]

MORE ON TERAWULF

* TeraWulf Inc. (WULF) Q3 2025 Earnings Call Transcript [https://seekingalpha.com/article/4841595-terawulf-inc-wulf-q3-2025-earnings-call-transcript]
* TeraWulf: High-Density HPC Contracts Drive Long-Term Infrastructure Value [https://seekingalpha.com/article/4837255-terawulf-high-density-hpc-contracts-drive-long-term-infrastructure-value]
* TeraWulf: High-Impact Business Pivot [https://seekingalpha.com/article/4830156-terawulf-high-impact-business-pivot]
* TeraWulf Q3 2025 Earnings Preview [https://seekingalpha.com/news/4518639-terawulf-q3-2025-earnings-preview]
* TeraWulk prices $900M convertible notes [https://seekingalpha.com/news/4511024-terawulk-prices-900m-convertible-notes]