Direct AI leases accelerate the infrastructure transition
- TeraWulf sold its Abernathy stake for $530 million to self-fund wholly-owned projects.
- The company signed a 401 MW lease with Anthropic worth approximately $19 billion in contracted revenue.
- Delivering CB-3 at Lake Mariner unlocked $600 million of Google credit support.
- Management warned that electrical labor is highly constrained and costs are creeping up.
- TeraWulf expects to entirely exit the legacy Bitcoin mining business by the next halving.
Aggressive execution on a massive scale
TeraWulf has validated its infrastructure pivot through massive direct leases and smart capital allocation. The company sold its Abernathy joint venture stake for $530 million to self-fund wholly-owned projects without diluting equity. This capital recycling funded the shift to direct-to-customer leasing, highlighted by a 401 MW lease with Anthropic in Kentucky.
The bull case centers on controlling power-rich sites as AI demand surges. Delivering CB-3 at Lake Mariner unlocked $600 million in Google credit support, significantly de-risking the build plan. Adding the gigawatt-scale Muskie campus and securing FERC approval for the Maryland site provides a deep pipeline of wholly-owned, scalable capacity.
The bear case focuses on execution and costs. Initial HPC margins were compressed during scale-up, and tenant fit-outs require massive upfront capital. Electrical labor is highly constrained and expensive. Building data centers at a 250 MW to 500 MW annual pace in a tight labor market leaves little room for error.
With funding risks mitigated by asset sales and credit backstops, the focus shifts entirely to delivery. The next catalysts are the energization of CB-4 and CB-5 at Lake Mariner, closing the Maryland acquisition, and signing initial tenants for the Muskie site.
Selling scarce power directly to AI tenants
TeraWulf makes money by turning power access into data center leases. Its old business used power to mine Bitcoin. Its new business leases high-performance computing space to customers that run AI and cloud workloads.
The company prefers colocation customers, meaning customers rent space, power, cooling, and network-ready infrastructure. TeraWulf is moving upstream to deal directly with end customers like Anthropic rather than relying solely on intermediaries, securing higher yields and tighter relationships.
The model relies on building campuses that bring their own generation. TeraWulf pairs data centers with power plants, gas generation, and battery storage. To fund these massive builds, the company employs credit-enhancing partnerships and recycles capital by monetizing joint ventures to redeploy into directly-controlled projects.
The model breaks if construction runs late, labor costs surge, or build costs rise faster than lease economics. While structural backstops and capital recycling help fund the cash outlays, the execution risk remains high given the scale of the build-out.
Direct leases and gigawatt campuses
Kentucky Hawesville (Anthropic)
Secured a 401 MW long-term direct lease with Anthropic representing approximately $19 billion in contracted revenue over 20 years.
Lake Mariner and Fluidstack
Maintains a 10-year 360 MW hosting agreement backstopped by Google. Critical IT capacity reached 102 MW with the delivery of CB-3.
Muskie Campus
Acquired a gigawatt-scale development site in Eastern Kentucky with initial service expected in Q4 2028.
Maryland (Morgantown)
Received FERC approval for the acquisition of a 210 MW generating station capable of supporting up to 1 GW of data center capacity.
Cayuga Site
An 183-acre long-term ground lease in New York with potential for up to 400 MW of gross capacity.
The revenue mix has flipped
This mix is from early 2026, when TeraWulf first disclosed that HPC leasing became the majority of total revenue. Since then, massive new HPC leases have accelerated the shift.
What could break the pivot
Build-out delays
High impact · Medium oddsTeraWulf is building massive data centers across several campuses at once. Delays in power equipment, cooling, permitting, or construction would push out revenue while capital costs keep running.
Labor constraints and costs
High impact · High oddsElectrical labor is highly constrained and hourly costs are creeping up across the data center industry. The company had to scale its workforce to roughly 1,000 electricians at peak at Lake Mariner, adding execution and margin risk.
Upfront capital and margins
High impact · Medium oddsTenant-requested design optimizations require massive upfront capital outlays, such as the $150 million from TeraWulf for recent builds. If initial margins remain compressed during scale-up, returns could lag expectations.
New York regulatory friction
Medium impact · Medium oddsNew York issued an executive order regarding data center development frameworks. While current builds are permitted, this creates regulatory friction for future expansions in the state.
In one breath
Is TeraWulf still a Bitcoin mining company?
Partly, but that is no longer the main story. In early 2026, HPC leasing became the majority of total revenue, and management said it will likely exit Bitcoin mining entirely by the next halving.
What does HPC mean for TeraWulf?
HPC means high-performance computing. For TeraWulf, it means leasing data center power, cooling, and space to customers running AI or cloud workloads.
How large is the Anthropic deal?
Anthropic signed a 401 MW lease at the Kentucky site. This agreement represents approximately $19 billion of contracted revenue over the 20-year initial term.
What is the next major thing to watch?
Watch for the energization of CB-4 and CB-5 at Lake Mariner, securing additional direct tenants for the new Muskie site, and the closing of the Maryland acquisition.
