Riot Platforms, Inc. Third Quarter 2026 Earnings Conference Call - RIOT PLATFORMS INC

Financial Performance:

• Q3 2026 total revenue reached $181 million, up 1% YoY, driven by a $46 million increase in data center/engineering revenue offsetting lower Bitcoin mining revenue.
• GAAP net income was $4 million ($0.01/share); Adjusted EBITDA was $191 million.
• Bitcoin mining segment produced 1,637 BTC with a net power cost of $0.032/kWh and direct production cost of $39,265/BTC.
• Company sold ~20,264 BTC YTD for $1.5 billion, reducing treasury to 2,418 BTC ($202 million) to fund data center expansion; fully repaid $200 million Coinbase credit facility.
• Current liquidity stands at $950 million ($748 million cash/restricted + $202 million BTC); zero equity raised in 2026.
• Engineering segment generated $47 million revenue (15% gross margin) with $142 million backlog, 90%+ focused on data center work.

Guidance and Future Outlook:

• Fully deployed portfolio (1,151 MW leased) expected to generate ~$2.3 billion average annual lease revenue and ~$2.2 billion average annual NOI by 2029.
• Capital deployment: 25 MW AMD online; 400 MW Corsicana Phase 1 by Sept 2027; full 1,151 MW expected in service by July 2028.
• 2026 guidance for average annual NOI updated to exceed the previous $1.6–2.1 billion range, now projected at ~$2 billion+.
• No anticipated equity issuance to fund announced projects; reliance on non-recourse project debt, tenant reimbursements, and internal liquidity.
• Future growth pipeline focuses on expanding existing sites, acquiring grid-powered land, self-generation, and strategic M&A/partnerships.

Business Segments and Product Lines:

• Corsicana: Signed largest lease in company history (15-year triple-net powered land lease with a frontier AI lab) for 910 MW.
  • Structure: Riot provides land/power infrastructure; tenant owns/operates modular compute.
  • Economics: ~$5.5 billion total project capex ($2M/MW site work + $4M/MW tenant reimbursement), ~99% NOI margin, ~33% unlevered yield on cost.
  • Reimbursements paid phase-by-phase post-delivery; optional $18M/month rent credit if debt financing unavailable.
• Rockdale:
  • 191 MW lease with same frontier AI lab (Tier 3 build, on schedule, $9.1 billion contract revenue).
  • First 96 MW ready Dec 2027; remaining 95 MW by June 2028.
  • Capex estimated at $11–12 million/MW, ~80% under Guaranteed Maximum Price (GMP).
• AMD:
  • 25 MW expansion on track for May 2027 (total 50 MW online); holding expansion options for additional 150 MW.
  • Project financing progressing; bank facility closing shortly.
• Bitcoin Mining: Transitioning from primary revenue source to capital funding mechanism; treasury sold down to fund infrastructure growth.

Market and Competitive Landscape:

• Total contracted revenue across AMD, Rockdale AI lab, and Corsicana AI lab now approx. $38 billion ($72 billion with extensions).
• Riot positioning itself as a leading digital infrastructure developer with "land, power, and infrastructure" moat rather than traditional build-to-suit operator.
• Competitive advantage cited as ability to deliver power interconnections faster than competitors due to existing operational sites (Rockdale: 7 years; Corsicana: multi-year operations).
• Market trend: High demand from AI labs for massive, immediate power capacity driving "take-or-pay" structures and single-tenant takedowns for entire campuses.

Risks and Challenges:

• Execution Risk: Management cites GMP contracts and early procurement to mitigate cost overruns; ~70% of Rockdale budget locked in GMP, remainder for power infrastructure (OFCI) being ordered.
• Regulatory/Political: Potential election impacts assessed as low risk due to existing approvals and long-term operational history at both sites.
• Construction Risk: Tenant bears operational/tech risk for compute modules at Corsicana; Riot retains site construction and power infrastructure risk.
• Financing Risk: Mitigated by non-recourse project debt, rent credit mechanisms, and diverse funding sources (cash, debt, tenant credits).

Management Commentary and Tone:

• Tone: Highly confident and optimistic, framing the year as a successful "transformation" from a Bitcoin miner to an infrastructure developer.
• Management emphasizes "risk-adjusted returns," highlighting the Corsicana structure reduces capital intensity by ~50% vs. Tier 3 builds while eliminating tenant utilization and operating risks.
• Strong focus on "non-dilutive" funding strategies and capital discipline; no equity raised in 2026 and none anticipated for current projects.
• CEO Jason West described the company as a "data center infrastructure platform" owning scarce inputs (land/power) with de-risked cash flows.

Analyst Questions and Answers:

• Rockdale CapEx Sufficiency: CEO confirmed $11–12M/MW estimate is robust due to early design locking and GMP contracting (~70% of budget); cost overruns on GMP scope are contractor's responsibility; Riot manages power equipment/tariff risks via early procurement.
• Corsicana Deal Structure: CEO explained single-tenant takedown maximizes value and leaseable capacity (910 MW vs. original 756 MW estimate) by accommodating tenant's modular build-out needs; structure offers best-in-class yield with lowest risk profile.
• Future Leasing at Rockdale: AMD holds options for 150 MW; ~200–250 MW remaining site capacity; expected to be leased to existing tenants (AMD/AI Lab) or new strategic partners.
• Bitcoin Mining Decommissioning: No immediate shutdown required for Phase 1 (400 MW); ramp-down expected summer 2027 as site prep begins for Phase 2.
• Political/Regulatory Impact: Management expressed high confidence citing fully approved interconnections and years of local community relations at both sites.

Other Key Points:

• Corsicana lease represents ~$28 billion in total contract revenue over 15 years (up to $54 billion with extensions).
• Tenant at Corsicana pays 100% of utility costs and operating expenses under triple-net terms.
• Riot's cash equity requirement for Corsicana is $500M–$1.1B, well-covered by $950M liquidity plus anticipated rent inflows and debt financing.
• Full deployment timeline compressed: 1,151 MW to be operational within 20 months of signing the final major lease.