Sign in

You're signed outSign in or to get full access.

TI

TERAWULF INC. (WULF)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $34.4M, down 19% year over year; GAAP net loss widened to $61.4M and Diluted EPS was $(0.16), driven by the April 2024 halving, higher network difficulty, and a temporary spike in power prices from extreme winter weather .
  • Non-GAAP Adjusted EBITDA turned negative at $(4.7)M versus $32.0M in Q1 2024; cost of revenue rose to 71.4% of revenue from 34.0% a year ago, reflecting power price volatility and infrastructure utilization .
  • Execution on HPC strategy advanced: MB-5 was energized (total capacity 245 MW, 12.2 EH/s); Core42’s 72.5 MW contracted build moved forward with revenue commencement staged across Q2–Q4 2025; project financing expected mid-2025 (SOFR + ~400–500 bps) .
  • Liquidity remained strong with $219.6M in cash and bitcoin; Board refreshed $200M share repurchase authorization and established a new $200M ATM, providing capital allocation flexibility—near-term stock catalyst is proof-of-execution as HPC halls (Wulf Den, CB-1, CB-2) come online .

What Went Well and What Went Wrong

  • What Went Well

    • Energized Miner Building 5, bringing total capacity to 245 MW and raising self-mining to 12.2 EH/s; fleet efficiency reached ~18 J/TH, and April mining returned to positive EBITDA as power normalized .
    • HPC hosting build progressed: Wulf Den to revenue in Q2, CB-1 in Q3, and CB-2 in Q4 2025; daily collaboration with Core42/Dell aligns specifications for scalable, liquid-cooled, high-density infrastructure (“we are committed to getting it right the first time”) .
    • Funding path intact: project financing process launching midyear with JPMorgan/Morgan Stanley; lenders’ feedback positive; guidance updated to ~75% EBITDA margins on initial HPC capacity .

  • What Went Wrong

    • Revenue fell 19% YoY to $34.4M and Adjusted EBITDA swung to $(4.7)M due to the halving, higher difficulty, and an extreme winter power price spike (Zone A standard deviation event); cost of revenue rose to 71.4% of sales .
    • Power cost per bitcoin mined increased sharply to $66,084 from $15,501 a year ago; BTC self-mined dropped to 372 from 1,051 in Q1 2024 (halving and Nautilus divestiture) .
    • GAAP net loss widened to $61.4M in Q1 2025, with SG&A including significant stock-based compensation; net loss per share was $(0.16) .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$27.059 $35.0 $34.405
Net Loss ($USD Millions)$(22.733) $(29.2) $(61.418)
Diluted EPS ($USD)$(0.06) — (net loss disclosed) $(0.16)
Cost of Revenue as % of Revenue54.2% —71.4%
Adjusted EBITDA ($USD Millions, Non-GAAP)$5.987 $2.5 $(4.695)
Bitcoin Self-Mined (#)555 423 372
End-of-Period Hashrate (EH/s)10.0 9.7 12.2

KPIs

KPIQ3 2024Q4 2024Q1 2025
Average Operating Hash Rate (EH/s)8.1 7.0 (CFO remark) 7.3
Power Cost per BTC ($USD)$30,448 $46,328 $66,084
Cash & Bitcoin Holdings ($USD Millions)$24.2 cash, $0.3 BTC $274.1 cash; $0.5 BTC $219.6 total cash & BTC

Notes: Non-GAAP metrics as defined by the company; see reconciliations in press releases/8-K exhibits .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
HPC CapEx per Critical MWInitial 60 MW~$6.1M/MW (3Q24 guidance) ~$7.2M/MW (2Q25 update) Raised
HPC Annual Base Rent per MWInitial 60 MW~$1.5M/MW (3Q24 guidance) ~$1.6M/MW (2Q25 update) Raised
HPC EBITDA Margin (Initial Capacity)Initial 60 MW~70% (prior midpoint) ~75% Raised
Total CapEx (72.5 MW)2025 Build~$365M (3Q24 guidance) ~$430M (2Q25 update) Raised
Fixed Costs (SG&A, OpEx, Interest)FY 2025N/ASG&A $40–45M; OpEx $20–25M; Interest $14M New
HPC Revenue Ramp2025N/AQ2: 2.5 MW; Q3: 20 MW; Q4: 50 MW New

Earnings Call Themes & Trends

TopicQ3 2024 (Prev-2)Q4 2024 (Prev-1)Q1 2025 (Current)Trend
AI/HPC initiativesPoC 2.5 MW complete; CB-1/CB-2 construction; customer before YE Signed Core42 72.5 MW; timeline to be refined Wulf Den revenue Q2; CB-1 Q3; CB-2 Q4; target 200–250 MW by 2026 Accelerating execution
Power prices/hedgingAvg power ~$0.038/kWh; demand response offsets Elevated Dec; planned outages to enable redundancy; 4Q avg ~$0.059/kWh Spike in Jan–Feb (1.76σ); guidance ~$0.05/kWh for 2Q–4Q Normalizing post-winter
Tariffs/macroFERC ruling boosts value of high-quality sites Broad demand; site/regulatory positioning emphasized Tariff impact 5–10% to build cost; design optimization continues Manageable cost inflation
Project financingPlan: ~70% LTC + 1-year revenue prepay Engaged JPM/MS; strong lender appetite Launch midyear; target SOFR + ~400–500 bps; scale with partners Imminent execution
Customer demandIntensifying; preference for scalable, power-ready sites Hyperscalers/enterprise interest; timing aligned with options Strong enterprise demand; “show-me” until CB-1 energized Robust; proof drives conversions
Related-party/structure—Cayuga integration process and governance noted Initiated Beowulf E&D integration; later acquired (May 27) Simplifying structure

Management Commentary

  • “We energized Miner Building 5, bringing total capacity to 245 MW. We remain on track to deliver the Core42 deployment this year and have initiated the financing process to support our next phase of HPC growth.” — Paul Prager, CEO .
  • “HPC hosting revenue is expected to begin in the second quarter of 2025 as our data halls come online. We also returned $33 million to shareholders during the quarter through share repurchases.” — Patrick Fleury, CFO .
  • “We estimate a 5% to 10% impact to build costs from tariffs…we remain committed to underwriting projects to mid-teens unlevered returns.” — Paul Prager, CEO .
  • “We have a high degree of confidence in executing an approximately $300 million debt raise in the middle of 2025…lenders have expressed strong interest.” — Patrick Fleury, CFO .

Q&A Highlights

  • Beowulf E&D integration: Independent Board process underway in Q1, later consummated on May 27 to simplify structure and eliminate related-party disclosures .
  • Future HPC margins: Initial capacity ~75% EBITDA; incremental margins on future MWs expected higher due to operating leverage across a single large site (labor efficiency) .
  • Demand and proof-of-execution: Management emphasized energizing CB-1 as the key milestone to convert robust enterprise/hyperscaler interest into signed contracts .
  • Power price volatility: The winter spike was a rare 1.76σ event; management does not plan to hedge given historically benign Zone A environment; 2025 guidance ~$0.05/kWh for 2Q–4Q .
  • Project financing terms: Target SOFR + ~400–500 bps; lenders focused on credit quality of Core42/G42; financing expected to recycle equity and fund additional data halls .

Estimates Context

  • Wall Street consensus (S&P Global) for Q1 2025 EPS and revenue was unavailable at the time of this analysis; multiple attempts to retrieve consensus for Q1/Q2 2025 returned no data. As a result, we cannot assess beats/misses versus S&P Global consensus for the quarter. Values retrieved from S&P Global.*
  • Implication: Given actuals (revenue $34.4M, EPS $(0.16)), and the known drivers (halving, power spike), sell-side models likely need to reflect higher energy costs and a staged HPC revenue ramp starting Q2–Q4 2025 rather than Q1 .

Key Takeaways for Investors

  • Near-term: Watch Q2 2025 for initial HPC revenue from Wulf Den; the pacing of CB-1/CB-2 energization (Q3/Q4) is the key stock catalyst, shifting the narrative from mining cyclicality to contracted HPC cash flows .
  • Financing: A successful project financing at SOFR + ~400–500 bps and ~70% LTC would validate the capital model and likely enable accelerated MW additions without equity issuance .
  • Cost dynamics: Power price normalization post-winter should improve BTC unit economics versus Q1; however, the halving/difficulty backdrop argues for a growing HPC mix to stabilize margins .
  • Tariffs/design: Expect modest CapEx inflation (5–10%), but improved rent (~$1.6M/MW) and higher initial HPC margins (~75%) preserve returns; total CapEx for 72.5 MW increased to ~$430M .
  • Balance sheet/capital allocation: With $219.6M cash/BTC and refreshed $200M buyback/ATM, the company retains flexibility; execution of financing and HPC ramp could free incremental cash for shareholder returns .
  • Structural simplification: Beowulf E&D integration/acquisition improves transparency and lender/investor appeal, aiding repeatable project financing .
  • Proof-of-execution premium: Management views “show-me” perception as temporary—successful energization and initial HPC revenues should compress the credibility discount and support re-rating .

Citations: All information above sourced from company press releases, 8-Ks, investor presentation exhibits, and earnings call transcripts: .