Riot Platforms reported its second quarter on Monday, 10 August 2026. We are writing about it today.
Errors or inaccuracies are possible. Spotted something that looks wrong? Write to me and I will correct it.
What Riot Does, and What It Is Becoming
Riot was built as a bitcoin miner. Today it is trying to be a data centre landlord.
To understand why that is even possible, you have to understand what its real asset is. A large bitcoin miner is not primarily a collection of machines - it is a power contract. A campus at Rockdale, Texas with an approved, energised grid interconnection at a scale of hundreds of megawatts is something that takes years to obtain and cannot be accelerated with money.
And that is exactly where the AI era's bottleneck sits: data centres wait years for a grid connection. Whoever is already connected, at gigawatt scale, holds a resource the market will pay far more for than bitcoin pays.
The capacity the company reports: roughly 1,700 MW in Texas and 300 MW in Kentucky.
The Deal, and This Is the Big Part
Subsequent to quarter end, Riot executed a Data Center Lease and Services Agreement with one of the world's leading frontier AI labs. The company does not name it.
| Capacity | 191 MW critical IT, Tier 3 build-to-suit data centre |
| Location | Rockdale campus, Texas |
| Term | 20 years, through June 2048 |
| Initial contract value | roughly $9.1 billion |
| With two 5-year extensions | roughly $16.1 billion |
| Estimated cumulative NOI | $7.3 to $8.2 billion |
| Estimated average annual NOI | $365 to $411 million |
| Delivery schedule | 96 MW in December 2027, full 191 MW by June 2028 |
| Interim financing | $573 million from Morgan Stanley |
For scale: the company's revenue for the entire quarter was $174.2 million. The estimated average annual contribution from this contract alone, $365 to $411 million of NOI, is larger than two quarters of total revenue.
And this is the second tenant on the campus. The first is AMD, under an agreement announced on 16 January 2026. Together: 241 MW contracted across two tenants, representing roughly $9.8 billion of long-term contracted revenue.
And AMD Is Already Paying
This is the point that separates Riot from everyone else in the sector.
During the quarter, delivery of the final 20 MW of AMD's initial deployment was completed, bringing the full 25 MW of commissioned capacity online - on time and on budget - and converting the lease to recurring revenue at full initial scale.
And the expansion is already under construction: a 10 MW Phase 3 is on track for delivery in November 2026, and a 15 MW Phase 4 follows in May 2027. At that point AMD's total contracted capacity of 50 MW will be fully deployed.
In numbers: data centre segment revenue in the quarter was $23.2 million - $4.9 million of operating lease revenue and $18.3 million of tenant fit-out services. This is the segment's second quarter of reported revenue.
And Then Comes the Quarter Itself
| The quarter | A year ago | |
|---|---|---|
| Revenue | $174.2 million | $153.0 million |
| Mining | $113.7 million | $140.9 million |
| Engineering | $37.3 million | $10.6 million |
| Data centre | $23.2 million | |
| Net loss | $237.2 million | |
| Diluted loss per share | $0.68 |
Revenue rose 14%. The net loss was $237.2 million.
Where the loss comes from. Two items explain close to half of it, and neither is operational:
1. Realized and unrealized loss on crypto assets: $74.6 million. The company holds 11,380 bitcoin, and under current accounting the holding is measured at fair value through profit and loss. When the bitcoin price falls, the loss is booked - without a single coin being sold.
2. Impairment of property and equipment: $28.0 million.
Together: roughly $102.6 million of a $237.2 million loss. The remainder comes from depreciation and amortisation, stock-based compensation and ongoing operating costs.
Which brings us to the line that is operational: mining revenue fell from $140.9 million to $113.7 million - even though the company mined more coins: 1,587 bitcoin against 1,426 a year ago.
The company's explanation: a lower average bitcoin price, and an increase in the global network hash rate, partially offset by an increase in Riot's own average operating hash rate.
And at the same time, the cost to mine a coin rose: $49,912 per coin excluding depreciation, against $48,992 a year ago. The company attributes this to higher power costs and the expansion at its Kentucky facilities. Against a bitcoin price of $58,527 at quarter end, the margin on each coin mined is roughly $8,600 - and narrowing.
The Balance Sheet
Liquid assets of more than $1.2 billion at quarter end:
- 11,380 bitcoin, of which 5,821 are held as collateral, worth roughly $666.0 million at a price of $58,527 as of 30 June 2026
- $548.9 million in cash, of which $77.5 million is restricted
And to fund the new project: a $573 million interim facility from Morgan Stanley, intended to fund initial development costs while an investment-grade credit backstop is finalised.
The power cost the company reports: 3.6 cents per kWh.
What the CEO Says
Jason Les, CEO:
"Our platform stands apart through three elements working together: multi-gigawatt-scale power capacity that is already fully approved and energized, in-house data center development expertise, and the ability to engineer custom infrastructure for computing's most demanding workloads"
Note the phrase "already fully approved and energized". That is not marketing language - it is precisely the central claim, and it is what separates a company that has power from a company that has a plan for power.
The Market Reaction
The stock fell 5.46% on Monday and closed at $19.40, against $20.52 on Friday.
הזווית שלי
דעה אישית של אילן אברמוב - לא ייעוץ ולא המלצה
This report is one of the most interesting cases I have seen this season, because it contains simultaneously the biggest news of the day and one of its biggest losses.
And I think the market actually read it correctly, even if the reaction looks odd at first glance.
Start with the strong side, because it is very real. A 20-year, $9.1 billion contract with a leading AI lab, with estimated average annual NOI of $365 to $411 million, is not an announcement
- it is a signed lease with a delivery schedule. And what convinces me more than that deal is AMD: 25 MW delivered on time and on budget, already generating actual lease revenue. A company that has proven once that it can deliver earns entirely different credit on the next promise.
This is bottleneck theory in action. The narrow link in the AI chain today is not chips and it is not software - it is connected, approved power. And whoever sits on it charges for it.
And now the other side, which cannot be ignored.
The mining business is contracting from within. The company mined more coins and took in less money, and the cost to mine a coin rose. A margin of roughly $8,600 on a coin that costs almost $50,000 to produce is a thin margin, and it depends entirely on a price nobody controls.
And the $237 million loss, even if most of it is non-cash, says something real: the company holds 11,380 bitcoin, of which 5,821 are pledged as collateral. So a move in the bitcoin price does not just hit the income statement - it touches the collateral the financing rests on. That is a connection worth holding in mind.
And what explains, to my eye, the gap between Riot and Bitdeer on the same day - five percent against twenty - is exactly the distance between a contract and cash flow. Bitdeer announced a comparable deal in Norway, $4.7 billion, but its equivalent site is still "in active evaluation of AI transition". At Riot there are already megawatts generating lease revenue. The market prices execution, not intention.
And what I will watch is a single date: December 2027. That is when the first 96 MW for the AI lab is due to come online. Until then, two things happen every quarter: the data centre segment grows, and the mining business stays hostage to the bitcoin price. The only question that matters is which of the two gets there first.
