Cipher Mining's Q3 2025 Earnings Call: Contradictions on HPC Demand, Power Availability, and Project Timelines Emerge

Date of Call: None provided

Financials Results

• Revenue: $72M, up 65% sequentially from $44M in prior quarter
• EPS: $-0.01 per share GAAP net loss (vs. -$0.12 prior quarter); adjusted earnings $0.10 per share, up ~34% sequentially

Guidance:

• Deliver 168 MW critical IT at Barber Lake by September 30, 2026; lease expected to commence October 2026.
• Deliver 300 MW gross to AWS in two phases beginning July/August 2026 with completion in Q4 2026; rent commencing August 2026.
• Colcas 1 GW site targeted power availability in 2028 with ~95% JV ownership once turnkey lease executed.
• Utilizing debt financing for majority of construction; remaining obligations to be funded from cash on hand; no further equity expected.

Business Commentary:

• Transformative Business Expansion into HPC:
• Cypher Mining executed a major transaction with AWS, securing a 15-year lease for 300 megawatts of gross capacity, worth $5.5 billion.

• This expansion is driven by Cypher's strategic pivot into the high-performance computing (HPC) space and the significant demand from hyperscalers for computing infrastructure.

• Growing HPC Development Pipeline:

• Cypher announced a new joint venture to develop a 1-gigawatt site in West Texas, expecting to own 95% of the JV once final terms are executed.

• This addition to the development pipeline is supported by strong demand from hyperscalers and the need for large-scale data center development.

• Financial Strength and Capital Raising:

• Cypher completed a $1.3 billion convertible offering, which was seven times oversubscribed, securing a 0% coupon.

• The strong demand is attributed to investor confidence in Cypher's strategy and the favorable market conditions.

• Records in Hash Rate and Power Capacity:

• Cypher's operational mining capacity increased to 23.6 exahash per second, with the addition of 477 megawatts from the Black Pearl site.
• This growth resulted from effective management and strategic deployment of new mining rigs, as well as favorable power sourcing agreements.

Sentiment Analysis:

Overall Tone: Positive

• Management repeatedly described the quarter as "truly transformative," announced two landmark HPC transactions (Google/FluidStack and AWS), cited $5.5B of contract revenue for the AWS lease, a $3B initial term for Barber Lake, a $1.3B 0% convertible offering that increased cash, and noted operations "surpassed expectations" with strong sequential improvement—supporting an overall positive tone focused on strategy shift and balance-sheet strengthening.

Q&A:

• Question from Paul Golding (Macquarie): How will the 300 MW be distributed across sites, what are expected PUE/pricing for air vs liquid-cooled, and how will you finance construction?
  Response: Phase one repurposes an existing air-cooled 150 MW (PUE ~1.40–1.45); phase two design may include liquid cooling to lower PUE; cost per critical IT MW expected in line with Barber Lake; financing planned to be primarily debt with remaining equity from cash on hand, and management is evaluating project-level financing options.

• Question from Greg Lewis (BTIG): How should investors think about sourcing power and ERCOT timelines across your pipeline?
  Response: Timelines depend on each TDSP and interconnection process; Colcas targeted for 2028 energization, Stingray on track for Q4 2026 and other sites are progressing with FEAs/deposits—management is confident in the provided energization timelines.

• Question from Greg Lewis (BTIG): What will you do with the 56 MW at Barber Lake—sell compute yourself or lease it?
  Response: Company will choose the highest risk-adjusted return; operating GPUs could generate higher revenue but carries substantial execution and obsolescence risk; leasing to hyperscalers offers better returns with far less risk—management expects to secure a deal soon.

• Question from Andrew Beal (The Research): What is the expected capex per MW at Colcas and do the Google/AWS leases aid approvals at other sites?
  Response: Preliminary budgetary build cost expected roughly in line with prior builds (~$9–$11M per critical IT MW, subject to inflation); signing marquee HPC leases materially increases Cypher's credibility with TDSPs/ERCOT and helps accelerate approvals.

• Question from Michael Donovan (Compass Point): Any supply-chain constraints or long-lead risks we should expect?
  Response: Substation work and backup gens are primary gating items; over 85% of long-lead equipment for Barber Lake is already secured—management is confident in meeting aggressive construction timelines given procurement relationships and team experience.

• Question from Michael Donovan (Compass Point): Are customers asking to link nearby sites into larger campuses (e.g., combine multiple sites for 1+ GW)?
  Response: While hyperscalers value clustered redundancy, Cypher's sites are generally not close enough to be physically linked into single campuses; concentration in West Texas offers operational and workforce efficiencies but not necessarily contiguous campus linkage.

• Question from Mike Colonies (HC Wainwright and Company): How will revenues from the two HPC agreements layer into 2026 and beyond?
  Response: FluidStack/Google (168 MW) expected fully delivered by Sept 30, 2026 with rent starting Oct 2026; AWS 300 MW will ramp in phases beginning Aug 2026 with later stages by year-end—material revenue ramp begins in late 2026.

• Question from Mike Colonies (HC Wainwright and Company): Why has the pace of hyperscaler deal announcements accelerated recently?
  Response: Management cites a rapid, unexpected surge in AI demand creating an acute megawatt shortfall; hyperscalers are urgently securing capacity for 2026–2027, driving accelerated leasing activity and rising lease rates.

• Question from Joseph Vafi (Canaccord Genuity): What’s the plan for Odessa given the behind-the-meter PPA expiring in July 2027—convert to HPC or keep mining?
  Response: Odessa's very low-cost PPA through July 2027 makes Bitcoin mining highly attractive today; conversion to HPC is possible but not prioritized while the PPA remains in effect.

• Question from Joseph Vafi (Canaccord Genuity): Is the AWS lease located at one site or distributed across sites?
  Response: The AWS 300 MW lease is at the Black Pearl site (conversion-ready), with phase-one reuse of existing high-quality infrastructure enabling the aggressive delivery timeline.

• Question from John Tadero (Needham): How confident are you in delivering the Black Pearl site quickly for AWS?
  Response: High confidence—Black Pearl was built to long-term standards and much of the 150 MW is immediately reusable, supporting the aggressive phase-one delivery timeline.

• Question from John Tadero (Needham): Who are the competitors when sourcing large greenfield sites like Colcas?
  Response: Primary competition comes from local site originators/wildcatters and a few peers; Cypher's unique advantage is dual credibility—sourcing deals locally while also meeting hyperscaler technical standards—giving it an edge in securing such sites.

Contradiction Point 1

HPC Demand and Market Dynamics

It highlights differing perceptions of the demand and market dynamics for High-Performance Computing (HPC) services, which are crucial for strategic decision-making and financial forecasting.

What factors have accelerated HPC deal announcements? - Mike Colonies(HC Wainwright and Company)

2025Q3: The market is driven by a sudden surge in AI demand, leading to lease rates rising rapidly. Hyperscalers are in a race for capacity, making the market very active. - Tyler Page(CEO)

What would trigger hyperscalers to partner with you, and how soon will this happen? - Bill Papanastasiou(KBW)

2025Q2: Hyperscalers show more willingness to work with our peer set. There's been an uptick in interest from hyperscalers since July. We're far along with a potential tenant, and interest in emergency meetings indicates significant developments. Market dynamics are favorable for future partnerships. - Rodney Tyler Page(CEO & Director)

Contradiction Point 2

Power Availability and Financing Strategy

It involves the company's strategy for securing power and financing for its data center projects, which are critical for its growth and revenue generation.

How should we assess the availability of power from your growth pipeline? - Greg Lewis (BTIG)

2025Q3: Sites awaiting final ERCOT approval were submitted long ago. Timelines depend on the business operating model of the provider, but American Electric Power is progressing construction based on a 2028 energization expectation. partnering with American Electric Power provides credibility, speeding construction and approval processes. - Tyler Page(CEO)

With Texas becoming a hub for data centers and Bitcoin mining, has securing additional power capacity become more streamlined or challenging? - Greg Lewis (BTIG)

2025Q1: Legislative changes in Texas aim to improve transparency in the interconnection queue, which should be a positive development. The commercial market remains robust, but regulatory changes may make getting interconnects more challenging. Cipher's existing interconnects provide a significant advantage. - Tyler Page(CEO)

Contradiction Point 3

HPC Site Conversion Timeline

It involves differing timelines for the conversion of HPC sites, which impacts the company's operational strategy and revenue projections.

How should we think about revenue from the two HPC agreements? - Mike Colonies(HC Wainwright and Company)

2025Q3: The full delivery of the FluidStack Google deal is by September 2026, with rent starting in October. Amazon's delivery is in two phases, beginning in August 2026. - Tyler Page(CEO)

How long will it take to convert hydro Bitcoin mining to AI HPC in Phase 2 compared to starting from scratch? - Bill Papanastasiou(KBW)

2025Q2: Phase 2 at Black Pearl is a Tier 1 half data center, ready back half of next year. Conversion to HPC will take a few months, depending on tenant interest. We're preparing for fast requests, either mining or HPC ready. - Rodney Tyler Page(CEO & Director)

Contradiction Point 4

Power Availability and Infrastructure Development

It involves differing perspectives on the availability and development timeline of power infrastructure, which is crucial for the expansion and profitability of the company's data center operations.

How should we think about the availability of power in your growth pipeline? - Greg Lewis (BTIG)

2025Q3: Sites awaiting final ERCOT approval were submitted long ago. Timelines depend on the business operating model of the provider, but American Electric Power is progressing construction based on a ```2028``` energization expectation. - Tyler Page(CEO)

What impact will the Barber Lake MOU have on project development and timeline? - John Todaro (Needham)

2024Q4: We are confident we will deliver the Barber Lake site by the year-end. We are working closely with Priority Power to align on the development timeline for a potential 500-megawatt data center in close proximity to the site. - Rodney Page(CEO)

Contradiction Point 5

Phasing and Expansion of Barber Lake Site

It highlights differing expectations and plans regarding the phasing and expansion of the Barber Lake site, which is a strategic location for the company's data center operations.

What is the power distribution plan for the 300 MW? What are the pricing details for liquid and air-cooled systems? What are the financing plans? - Paul Golding (Macquarie)

2025Q3: The ink is still drying on the deal, so final numbers are not fully available. The ```300 megawatts``` include recutting an existing air-cooled 150 megawatts and building a second phase. - Tyler Page(CEO)

What impact will the recent Barber Lake MOU have on the site's development timeline? - John Todaro (Needham)

2024Q4: Discussions with potential tenants in this area of Texas have been ongoing. The 337 acres adjacent to Barber Lake increases the site's potential. The MOU with Priority Power opens discussions for a ```500-megawatt``` data center nearby. - Rodney Page(CEO)