AMD deal nearly doubles capacity
Riot Platforms (RIOT) saw its shares jump about 8% on Friday after Advanced Micro Devices (AMD) expanded its capacity at Riot’s Rockdale, Texas campus. According to Q1 financial results, AMD exercised an option to double its contracted capacity to 50 megawatts (MW), with a potential upsize to 150MW. The deal could generate roughly $636 million over a 10-year term.
Riot also secured better terms on its $200 million bitcoin-backed credit facility with Coinbase, dropping the interest rate to a fixed 6.15% from 8.3%. Coinbase released 1,544 bitcoin held as collateral, indicating growing lender confidence in Riot’s expanding data center business.
Matthew Sigel, head of digital assets research at VanEck, noted the market appears to be pricing in a lower cost of capital, with the expanded AMD deal driving lender confidence.
Pivot from pure mining
Riot was one of the last ‘pure play’ mining companies not hosting AI computing. Activist investor Starboard urged management to accelerate the transition to an AI infrastructure provider. The Castle Rock, Colorado-based company reported total revenue of $167.2 million for the quarter ending March 31, up from $161.4 million a year earlier, supported by $33.2 million in initial data center revenue. Bitcoin mining revenue fell to $111.9 million from $142.9 million due to lower bitcoin prices and more competition.
Over the last 12 months, Riot’s shares are up about 147%, while bitcoin fell nearly 17% during that same period.
Bitcoin sales accelerate
Riot sold 3,688 bitcoin during Q1, shifting from its previous practice of holding all mined bitcoin. At the end of March, Riot still held 15,679 bitcoin and had $282.5 million in cash.
