Bitcoin Miner Riot Platforms Inks $311M AI Data Center Deal with AMD After Selling Bitcoin

Bitcoin Miner Riot Platforms Deepens AI/HPC Push with Texas Land Deal

The deal followed Riot announcing last week that it sold more than $160 million of its Bitcoin holdings as part of a strategy shift, to broaden use of its data centers. Shares of Riot Platforms jumped more than 11% after the crypto miner said it sold Bitcoin to help finance a land acquisition in Texas. In a Friday notice, Riot said the $96 million deal for 200 acres of land in Rockdale, Texas was funded entirely by the sale of about 1,080 Bitcoin (BTC). The miner also signed a data center lease and services agreement with semiconductor company Advanced Micro Devices (AMD), initially deploying 25 megawatts (MW) of "critical IT load capacity." "These results mark a pivotal moment that cements Riot's position as a leading data center developer, less than twelve months since the launch of our formal process to evaluate our assets for AI/HPC use," said Riot CEO Jason Les. Riot said the agreement for an initial 10-year term could generate about $311 million in revenue for the company, with the potential for $1 billion if three five-year extensions were exercised. The company's shares on the Nasdaq under the ticker symbol RIOT surged to $18.80 amid the announcement, marking an 11% increase in the previous 24 hours. Related: US bank upgrades TeraWulf price target, offers bullish mining prediction The Texas deal followed Riot announcing last week that it had sold 1,818 BTC in December as part of a strategy shift from mining the cryptocurrency to using its data center infrastructure for other applications, including artificial intelligence. The company reported holding 18,005 BTC as of Dec. 31, worth more than $17 billion at the time of publication. CleanSpark announced a move similar to Riot's on Wednesday after the Bitcoin mining company reached an agreement to buy 447 acres of land in Brazoria County, Texas. The miner said it planned to develop a 300 MW data center, which could be "designed for artificial intelligence and high-performance computing workloads." Riot and CleanSpark are just two of many companies focused on mining and crypto mining infrastructure to broaden their services amid increasing BTC difficulty. MARA Holdings, Core Scientific, Hut 8 and TeraWulf have also announced plans aligned with AI and high-performance computing.

RIOT Stock Jumps as Bitcoin Miner Signs AI Deal With NVIDIA Rival AMD

The deal may be increased to 200 megawatts and will end up generating close to $1 billion over the long-term. Stock of Riot Platforms rose on pre-market trading following the company's announcement of a major data center deal focused on AI with Advanced Micro Devices (AMD). This move indicates a new strategic direction for Riot, linking its Bitcoin mining equipment with the increasing need for AI computing resources. Riot Enters AI Data Center Space In a press release, Riot stated that it has entered into its first large-scale data center lease with AMD at the Rockdale site in Texas. As a result of this deal, Riot has emerged as a new player in the U.S. hyperscale data center market for high-performance computing workloads. Under terms of the agreement, Riot will provide AMD with 25 megawatts of critical IT load capacity. Construction is scheduled to start in January 2026, and be completed by May 2026. The term of the initial lease is ten years, and Riot expects to earn approximately $311 million from the deal. However, if the company exercises extension options, the total value of the deal could be increased to nearly $1 billion over time. AMD retains the option to expand and increase the amount of leased capacity up to 200 megawatts, which would place Riot in competition with other top players in the U.S. hyperscale data center space. Why Is RIOT Stock Up Today? Stock holders responded positively to the news, resulting in a sharp price increase in Riot shares prior to the opening bell. According to TradingView, RIOT shares extended gains during the session, climbing over 12% to trade near $18.61. Its price is holding well above the previous close of $16.57, signaling sustained bullish interest. Since the company continues to actively mine Bitcoin, Riot Bitcoin mining output keeps rising steadily. Following the purchase 200 acres of land at the Rockdale site by Riot for $96 million, the company sold around 1,080 Bitcoin from its balance sheet to fund the purchase. Complete ownership of the land provides Riot with control of one of its most valuable assets for an extended period of time. In addition to a 700-megawatt grid connection, the property contains a dedicated water supply and fiber connectivity. Riot said that this deal will unlock new opportunities for Riot's AI customers and those seeking high density computing solutions. In addition, it will allow Riot to turn existing power capacity into on-going infrastructure revenue. Why Are Bitcoin Miners Moving into AI? The AMD deal puts Riot in direct competition with NVIDIA in the AI hardware space. Therefore, it extends the relevance of Riot's business model well past crypto cycles. The AMD deal is part of a larger trend of increasing AI infrastructure demand from Bitcoin mining operations, which are increasingly becoming AI infrastructure. AI companies need an enormous amount of reliable power and customized data center design to function effectively. Bitcoin miners have data centers operating at a high level of reliability and efficiency, which makes them ideal candidates to become AI infrastructure providers. This is why there is a growing number of miners transitioning their focus to providing AI infrastructure. Riot is one of the first publicly traded miners to have secured a major AI customer (AMD). The company executives stated that the partnership demonstrates Riot's ability to develop its own products, and provides validation for its power strategy. The executives also stated that Texas is a prime location for the construction of large-scale digital infrastructure. Riot currently has over 1.7 Gigawatts of approved power capacity across its Texas based properties. Hence, it believes it can use this capacity to provide AI and enterprise data center clients with a scalable solution.

Why Shares of Riot Platforms Are Surging Today | The Motley Fool

Bitcoin miners operate large data centers because the cryptographic puzzles they must solve to mine new Bitcoin require a tremendous amount of energy. However, more Bitcoin miners are transitioning to data centers for artificial intelligence, given AI's popularity and the fact that the majority of Bitcoin tokens have already been mined. Riot plans to acquire 200 acres of land at its Rockdale data center site, which it currently occupies, for $96 million. The deal will be funded by the sale of 1,080 of Riot's Bitcoin. Located in Rockdale, Texas, the Rockdale site is North America's largest Bitcoin mining facility by developed capacity, and has a total of seven buildings with various immersion- and air-cooling technology systems. Riot will then lease 25 megawatts (MW) of critical information technology load capacity to AMD, with the potential to expand by another 200 MW. "I am pleased to share the substantial progress we have made at Rockdale, which expands our fully approved data center power portfolio to 1.7 gigawatts and, through the signing of a data center lease with AMD, firmly establishes Rockdale as a leading data center development opportunity," Riot's CEO Jason Les said in a statement. The move by Riot certainly makes sense, given how big an industry AI is going to be and how much data center capacity it will require. Still, the stock trades at 54 times earnings, and there are many questions about the data center business, such as how commoditized it will become. Data centers are also heavily dependent on the future of AI, which may not necessarily be a linear path. For this reason, I remain cautious on the name and only recommend a smaller, speculative position at most.