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    WULF
    Earnings call· Jun 2026(Q2 FY26)

    TERAWULF Q2 FY26 earnings call WULF

    Aug 5, 2026 Source

    Executive summary

    TeraWulf Q2 FY26 — Execution and Expansion Drive Strong Contracted Revenue

    TeraWulf delivered a strong quarter marked by significant execution at Lake Mariner, bringing CB-3 online and securing $600 million in credit support. The company expanded its Kentucky platform with a $19 billion Anthropic lease and the Muskie acquisition, while strategically divesting the Abernathy JV to focus on larger, directly controlled opportunities. Despite non-cash losses and pre-revenue costs impacting profitability, the firm's focus on power-advantaged infrastructure and long-duration contracts positions it for continued growth and value creation.

    Highlights

    5

    • Total revenue increased 31.8% QoQ to $44.8 million, driven by additional HPC capacity.

    • HPC lease revenue grew 52% QoQ to $31.9 million, representing 71% of total revenue.

    • Executed a 20-year lease with Anthropic for 401 MW at Justified data campus, representing approximately $19 billion of contracted revenue.

    • Divested Abernathy joint venture for $530 million, achieving a 20% IRR on initial investment.

    • Completed CB-3 at Lake Mariner, bringing 102 critical megawatts online and making $600 million of Google's credit support effective.

    Concerns

    5

    • GAAP net loss attributable to TeraWulf increased to $939.9 million from $427.6 million QoQ, primarily due to noncash fair value adjustment of Google warrants.

    • Non-GAAP adjusted EBITDA was negative $18.3 million, reflecting pre-revenue operating and development costs.

    • Cost of revenue (exclusive of depreciation) increased to $12.4 million from $2.4 million QoQ, mainly due to lower demand response proceeds.

    • Operating expenses increased to $23.4 million from $11.2 million QoQ, driven by scaling platform ahead of HPC capacity.

    • Electrical labor constraints and evolving customer requirements led to an updated Wulf Compute project cost estimate of $9.1 million per megawatt, up from $8.6 million financed in October 2025.

    Guidance & targets

    3
    CategoryTargetConfidence
    Incremental critical IT capacity contracted annually
    250 to 500 megawatts
    high materiality
    High
    Full year adjusted SG&A
    $75 million to $100 million
    medium materiality
    High
    Wulf Compute total project costs per critical IT megawatt
    Approximately $9.1 million
    medium materiality
    High

    Segment performance

    1
    SegmentRevenueYoYQoQMargin
    HPC Leasing
    Reported margin includes $2.8 million of tenant fit-out revenue/costs, $6.8 million of pre-revenue operating costs, and $6.0 million of development costs. Adjusted HPC Leasing segment profit margin was approximately 80% after adjusting for these items. Expects margins to progress toward long-term target of 85%.
    HPC lease revenue as % of total revenue: 71%
    		$31.9 million—52%28%

    Operational metrics

    23
    Total revenue
    $44.8 millioncompared with $34.0 million in the first quarter
    Q2 FY26

    Primarily reflecting additional HPC capacity coming online.

    HPC lease revenue
    $31.9 millionfrom $21.0 million
    Q2 FY26

    Increased 52% quarter-over-quarter.

    HPC lease revenue as % of total revenue
    71%
    Q2 FY26
    Cost of revenue (exclusive of depreciation)
    $12.4 millionfrom $2.4 million in the first quarter
    Q2 FY26

    Increase primarily reflects lower demand response proceeds, which declined to $2.8 million in Q2 from $14.1 million in Q1.

    Operating expenses
    $23.4 millionfrom $11.2 million
    Q2 FY26

    Primarily included $5.8 million of additional site level expenses, $3.3 million of site preparation and demolition costs, and $2.2 million of minor equipment repair costs.

    Adjusted SG&A (excluding stock-based compensation and charitable contributions)
    $28.6 millioncompared with $26.3 million in the prior quarter
    Q2 FY26
    Depreciation
    $21.2 millionfrom $28.5 million in the first quarter
    Q2 FY26

    Q1 included $11.9 million of accelerated depreciation associated with Bitcoin mining assets, compared with $2.6 million in Q2.

    Interest expense
    $56.4 millioncompared with $67.1 million in the first quarter
    Q2 FY26
    Interest income
    $28.9 millioncompared to $29.4 million in Q1
    Q2 FY26
    Cash interest paid
    $125.7 millioncompared with $5.3 million in the first quarter
    Q2 FY26

    Reflecting the first semiannual interest payment on the Wulf Compute senior secured notes in April.

    Noncash loss from change in fair value of Google warrants
    $755.7 millioncompared with a $216.3 million noncash loss in the first quarter
    Q2 FY26

    Primarily driven by the increase in TeraWulf stock price and had no impact on liquidity.

    Equity in net loss of Abernathy joint venture
    $11.1 milliongenerally consistent with the $11.5 million in the first quarter
    Q2 FY26
    GAAP net loss attributable to TeraWulf
    $939.9 millioncompared with $427.6 million in the first quarter
    Q2 FY26

    Increase primarily driven by the noncash fair value adjustment associated with the Google warrants.

    Non-GAAP adjusted EBITDA
    negative $18.3 millioncompared with negative $4.1 million in the first quarter
    Q2 FY26

    Reflecting continued pre-revenue operating and development costs incurred ahead of additional contracted HPC capacity entering service.

    Cash and restricted cash
    $3.0 billion
    as of June 30, 2026
    Unrestricted parent cash
    $1.2 billion
    as of June 30, 2026

    Increased to approximately $1.45 billion including initial $250 million Abernathy payment received in July.

    Wulf Compute gross cash
    $1.9 billion
    as of June 30, 2026

    Approximately $1.5 billion after accounting for debt service reserves and interest during construction accounts.

    Wulf Compute project capital expenditures completed
    $2.3 billion
    as of Q2 FY26

    Approximately $1.7 billion remaining, with 2/3 committed.

    Wulf Compute project pro forma capitalization (equity)
    32%compared with approximately 26% equity
    Project completion

    Following FluidStack lease amendments and TeraWulf's additional capital contributions.

    Wulf Compute project pro forma capitalization (debt)
    68%compared with approximately 74% debt
    Project completion

    Following FluidStack lease amendments and TeraWulf's additional capital contributions.

    Equity contributed to Justified Data campus
    $353 million
    as of June 30, 2026

    Includes $200 million site acquisition cost.

    Incremental lease revenue from FluidStack amendments
    more than $500 million
    Initial lease terms

    Comprises over $300 million from tenant fit-out costs and $200 million from increased contracted capacity (162 to 168 critical megawatts at CB-4 and CB-5).

    Return on incremental lease revenue from FluidStack amendments
    mid-teens return
    null

    In line with the yield on cost on the lease for tenant fit-out items.

    Industry KPIs

    6
    MetricValueDetails
    Capacity CAPEX102 megawattsMW
    Revenue growth$44.8 millionUSD
    Rpo current rpo$19 billionUSD
    Bookings billings$19 billionUSD
    Operating FCF margin rule of 4028%%
    Ai product adoption monetization401 megawattsMW

    Deals & partnerships

    4
    AnthropicLong-term lease for critical IT capacityapproximately $19 billioninitial 20-year lease term

    Lease for approximately 401 megawatts of critical IT capacity at the Justified data campus in Kentucky.

    Abernathy joint ventureSale of entire interest in the joint ventureapproximately $530 million

    Allows TeraWulf to focus on larger-scale opportunities directly controlled.

    Muskie Data campusAcquisition of a gigawatt-scale development site

    Located in Eastern Kentucky, developed in partnership with Kentucky Power (an AEP company). Electric service arrangements under a data center tariff for 1 gigawatt.

    Morgantown site (Chesapeake)Proposed acquisition of a site with existing generation and infrastructure

    Includes approximately 210 megawatts of existing grid-connected generation and long-term expansion potential.

    Risks & headwinds

    4
    Electrical labor constraintsOngoing

    approximately 1,000 electricians at peak

    Mitigation: Added a second electrical contractor and scaled workforce; working with Fluor and other vendors to put parameters around labor costs and lock in ranges.

    Design optimization and evolving customer requirementsOngoing

    Added complexity to execution; reflected in updated Wulf Compute project cost estimate of $9.1 million per megawatt.

    Mitigation: Working closely with FluidStack to optimize electrical, cooling, and operational requirements; revised delivery schedules developed collaboratively to align infrastructure readiness with hardware deployment.

    Regulatory and political headwinds (e.g., New York Executive Order, Texas backlog)Near-term to long-term

    New York Executive Order described as an effort to establish a framework, not a permanent ban; Texas backlog over 400 gigawatts.

    Mitigation: Developing sites that demonstrate credible and redundant power delivery, assume appropriate cost responsibility, and support additional generation capacity; focusing on regional diversity to avoid reliance on single regulatory regimes; proactive engagement with regulators, utilities, and local communities.

    Project cost increases (Wulf Compute)Project duration

    Total project costs estimated at approximately $9.1 million per megawatt, up from $8.6 million financed in October 2025.

    Mitigation: FluidStack lease amendments recovered incremental costs, generating over $500 million in additional revenue over initial lease terms; focusing on mid-teens return on capital for projects.

    What to watch in Q3 FY26

    5

    CB-4 first data hall energization and revenue generation

    Late September
    CurrentIn Level 2 commissioning
    TargetBegin generating lease revenue

    Why it matters

    Marks a key milestone for Lake Mariner expansion and contributes to HPC lease revenue.

    We remain on track to reach level for and begin generating lease revenue from the first data hall in late September.

    Q&A highlights

    6

    How do utility partnerships work, specifically regarding economics and whether utilities share project economics, using Kentucky Power as an example?

    Nazar Khan explained that integrated utilities like Kentucky Power (AEP) contract for load and then find generation to support it. They expect TeraWulf to commit to transmission build-out and backstop energy. The economics depend on location (driving transmission costs) and market price for energy.

    “With the integrated utilities, Kentucky Power being an example and AEP being an example, I think they are independently solving for contracting for the load. So they've signed up [indiscernible] a lot of capacity with us under an LOA transmission agreement and then they go find the generation to support that.”

    asked by Nick Giles · answered by Nazar Khan

    2 min read6 chapters

    Detailed Narrative

    01

    Lake Mariner Execution and Milestones

    TeraWulf successfully delivered CB-3 at Lake Mariner, bringing 102 critical megawatts online and generating lease revenue. This completion also activated $600 million of Google's credit support for FluidStack's lease obligations. The company is on track to energize the first data hall at CB-4 in late September and the first data hall at CB-5 in early January, following updated delivery schedules developed in coordination with the tenant.

    02

    Kentucky Platform Expansion

    The company significantly expanded its presence in Kentucky by executing a 20-year lease with Anthropic for 401 megawatts at the Justified data campus, representing approximately $19 billion in contracted revenue. Additionally, TeraWulf acquired the Muskie Data campus, a gigawatt-scale development site in partnership with Kentucky Power, which provides a utility-supported development pathway with contracted electric service and a state-approved framework.

    03

    Strategic Capital Recycling and Portfolio Focus

    TeraWulf agreed to sell its entire interest in the Abernathy joint venture for $530 million, generating a 20% internal rate of return. This divestiture allows the company to focus management resources and capital on larger-scale opportunities where it directly controls the site, power infrastructure, development process, and customer relationships, reinforcing its strategy of creating long-term value.

    04

    Chesapeake Acquisition and Regional Diversity

    The Federal Energy Regulatory Commission (FERC) authorized the acquisition of the Morgantown site in Chesapeake, clearing a significant regulatory hurdle. This site includes 210 megawatts of existing generation and potential for up to 1 gigawatt of data center capacity, supporting regional grid reliability. TeraWulf emphasizes regional diversity across its pipeline to mitigate dependence on single grids or regulatory regimes.

    05

    Addressing Regulatory and Labor Challenges

    Management acknowledged increasing formal requirements for large load development, such as New York's executive order, and views them as opportunities for experienced developers. The company is proactively addressing electrical labor constraints by adding a second electrical contractor and scaling its workforce to maintain targeted delivery schedules, while also optimizing designs in close collaboration with customers.

    06

    Financial Implications of FluidStack Lease Amendments

    Amendments to the FluidStack leases at Lake Mariner involve TeraWulf contributing approximately $150 million for tenant fit-out costs. In return, Wulf Compute expects to receive over $300 million of incremental lease revenue over the initial 10-year term, plus an additional $200 million from increased contracted capacity, totaling over $500 million in incremental lease revenue. This enhances the project's deleveraging profile and equity layer.

    AI-generated summary of the company’s earnings call. Not investment advice.