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Key Notes
- The 10-year agreement provides 200 MW of critical IT capacity at TeraWulf's Lake Mariner facility in New York.
- Google's financial backing includes purchase warrants for 41 million shares, representing approximately 8% ownership.
- TeraWulf stock surged 38% following the announcement despite reporting $79.8 million losses in H1 2024.
Data center infrastructure firm TeraWulf has entered a high-performance computing (HPC) colocation agreement with cloud services provider Fluidstack worth at least $3.7 billion.
Under the terms of the deal announced on Aug. 14, TeraWulf will provide at least 200 MW of critical IT load at its Lake Mariner data center campus in New York over a period of 10 years. The arrangement contains two 5-year extension options which, if exercised, would bring total revenue to $8.7 billion over 20 years.
Google has agreed to backstop $1.8 billion of Fluidstack’s lease obligations in exchange for purchase warrants for approximately 41 million shares of TeraWulf common stock, which would give the Silicon Valley heavyweight a pro forma equity ownership stake of around 8%.
In the wake of the news, TeraWulf stock (WULF) opened at approximately $7.20 on Aug. 14 after settling at $5.46 to close the previous day. The stock reached as high as $8.06 in early trading and, as of the time of this article’s publication, sits at approximately $7.54, according to data from MarketWatch.
A five-day trading view for WULF. Source: MarketWatch
The stock bump could be a sign that there’s light at the end of the tunnel for TeraWulf after operating at a loss for most of 2024. According to a report from Finance Feeds, the mining and infrastructure firm took an $18.4 million net loss for the second quarter, bringing its year-over-year deficit to $79.8 million for the first half. Revenues, however, are up and the firm retains a strong position going into the third quarter with $90 million split between cash and Bitcoin BTC $118 271 24h volatility: 3.4% Market cap: $2.35 T Vol. 24h: $76.39 B reserves. It also has $500 million in convertible notes on its balance sheet which are due in 2030.
Just a year ago, in the summer of 2024, TeraWulf was reportedly considering another merger as it dealt with the wake of the Bitcoin halving. However, strong business on the back of its artificial intelligence and high-performance computing operations has its stock up over 108% year over year.
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