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Date

Thursday, Feb. 26, 2026 at 4:30 p.m. ET

Call participants

  • Chief Executive Officer — Paul Prager
  • Chief Operating Officer — Nazar Khan
  • Chief Financial Officer — Patrick Fleury

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Takeaways

  • Total revenue -- $35.8 million in Q4, a decrease from $50.6 million in Q3, driven by lower Bitcoin production.
  • HPC lease revenue -- $9.7 million in Q4, up 35% from $7.2 million in Q3, following the ramp in contracted critical IT load.
  • Full-year revenue -- $168.5 million, reflecting a 20% increase from $140.1 million in 2024, with $151.6 million contributed by digital asset revenue and $16.9 million by HPC leasing.
  • Cost of revenue -- Increased to $18.9 million in Q4 from $17.1 million in Q3; up 33% year over year to $82.7 million, primarily due to higher realized power prices.
  • Demand response proceeds -- Reduced cost of revenue by $4.4 million in Q4, down from $7.44 million in Q3; for the year, totaled $17.7 million, up from $8.6 million in 2024.
  • Operating expenses -- Rose to $8.8 million in Q4 from $4.5 million in Q3; full-year figure reached $19.7 million, up from $7.6 million in 2024 due to team scaling and platform readiness.
  • SG&A expense -- $66.6 million for Q4, versus $16.7 million in Q3; full-year total of $147.8 million, or $94.5 million when adjusted for stock-based compensation, driven by workforce expansion and milestone compensation.
  • Depreciation expense -- $88.6 million, compared to $59.8 million in 2024; included $19.6 million of accelerated depreciation for mining asset transition.
  • Interest expense and income -- Q4 interest expense was $62.4 million and interest income $31.5 million; full-year interest expense totaled $80.2 million and interest income $39 million.
  • Non-cash loss on warrants -- Loss of $429.8 million from changes in fair value of warrant and derivative liabilities, predominantly related to Google's warrant, with no liquidity impact.
  • Net loss -- GAAP net loss of $661.4 million versus $72.4 million net loss in 2024; largely attributable to non-cash warrant adjustments and depreciation.
  • Adjusted EBITDA -- Non-GAAP adjusted EBITDA was negative $23.1 million for the year, down from positive $60.4 million in 2024; reflects investments in platform buildout and operational scale.
  • Liquidity -- Ended 2025 with $3.7 billion total cash and restricted cash; $500 million was available at the holdco parent as of Jan. 31, 2026, or $300 million after the Kentucky acquisition.
  • Wolf Compute project funding -- $3.0 billion gross cash at year-end, $2.6 billion net of reserves, with $850 million of CapEx spent and $2.38 billion remaining, maintaining a $200 million cash cushion.
  • Abernathy JV funding -- $1.5 billion gross cash, $1.2 billion net of reserves as of Jan. 31, 2026; $268 million CapEx spent and $1.1 billion to complete, with $70 million project-level cushion and $100 million parent-level reserve.
  • HPC segment margin -- As-reported margin was approximately 42% for 2025; after adjustments for tenant fit-out and pre-revenue costs, adjusted segment margin was roughly 77%, trending toward long-term 85% guidance as deployment scales.
  • Signed agreements -- $12.8 billion of high-performance computing (HPC) lease deals executed during 2025, supported by Google's credit and FluidStack partnership.
  • Financing -- $6.5 billion in debt and equity-linked funding transactions completed, broadening balance sheet capacity for execution.
  • Critical IT capacity delivered -- 18 megawatts energized by year-end, with CB2A for Core 42 delivered and further phases on track; design optimizations increased building capacity from 162 to 168 megawatts each for CB4 and CB5.
  • Incremental revenue generation -- Approximately $200 million of additional lease revenue projected over the initial term from optimized building capacity at Wolf Compute campus.
  • Contract structure -- All major campus, building, and capacity deals are structured as long-term, credit-enhanced, non-speculative contracts, primarily with hyperscalers, hyperscale AI, and world-class credits.

Summary

TeraWulf (WULF 3.61%) transitioned from Bitcoin mining to credit-backed, contracted high-performance computing (HPC) infrastructure, anchored by $12.8 billion in lease agreements and major power site acquisitions. Management emphasized the commissioning of advanced sites in Kentucky, Maryland, Cayuga, and a Texas joint venture, each supporting portfolio scalability and regional power security. Project portfolios are increasingly tailored to hyperscaler requirements, with design standardization and capacity optimizations improving execution reliability and contracted revenue visibility. Significant investments in personnel, construction partnerships, and engineering reinforce the company's ambition to deliver and monetize 250-500 megawatts of contracted capacity each year through 2030.

  • CEO Prager said, "With Google's warrants, it will be our largest shareholder."
  • Management stated that Kentucky's 480-megawatt campus features "immediate power availability, expansion potential, and strong state support."
  • Nazar Khan explained, "Through design optimization, we increased critical IT capacity from 162 megawatts to 168 megawatts per building without impacting the base construction budget."
  • The Abernathy joint venture remains scheduled for a fourth-quarter 2026 lease commencement and benefits from a fixed EPC structure to limit construction cost variability.
  • Leadership communicated that further acquisitions and brownfield site controls now underpin the long-term annual delivery target and stated, "The runway is in place. Growth from here is execution."
  • Quarterly Q&A sessions revealed active hyperscaler customer engagement, expanding demand, and state-level regulatory support for large-scale data center buildouts.

Industry glossary

  • HPC (High-Performance Computing): Enterprise-grade computing infrastructure engineered to deliver advanced, power-intensive workloads such as artificial intelligence training, typically for hyperscaler clients and sold on a capacity lease basis.
  • PUE (Power Usage Effectiveness): Industry metric measuring data center energy efficiency, calculated as the ratio of total site energy used to delivered IT load; lower values (e.g., 1.25) indicate higher efficiency.
  • Demand response: Utility program compensating facility operators for dynamically reducing or shifting their power usage during periods of grid stress or peak demand, thus generating operational cost offsets.
  • EPC (Engineering, Procurement, and Construction): Fixed-scope contract structure assigning a single party responsibility for engineering design, procurement, and construction delivery for large-scale facilities, often used to minimize execution risk.
  • Critical IT capacity: The power allocated explicitly to revenue-generating computing hardware (servers, GPUs) in a data center, distinguished from total gross site megawatts, reflecting the monetizable metric for lease contracts.

Full Conference Call Transcript

Paul Prager: Thank you, John, and good afternoon, everyone. 2025 was a defining year for TeraWulf Inc. We said we would transition this company into a scaled power-backed AI infrastructure platform, and we did. Our strategy is simple and disciplined: control energy-advantaged sites, engineer infrastructure around power, and contract long-term credit-backed AI capacity. Everything we did in 2025 supports that strategy. First, we acquired 100% of Beowulf Electricity and Data, eliminating related-party complexity and fully integrating power generation expertise into our platform. In today's market, power is the gating factor. If you do not control power, you do not control your destiny. We do.

Second, we secured long-duration site control at Cayuga, up to 400 megawatts at a retired coal facility with real grid infrastructure already in place. Brownfield, power-backed, scalable. That is our model. Third, we signed a 450 megawatt lease with FluidStack supported by Google's credit. That was a platform-defining deal. It validated our model, our execution capability, and ability to contract at scale. With Google's warrants, it will be our largest shareholder. That alignment speaks for itself. Fourth, we replicated the model in Texas through the Abernathy joint venture, proving portability across power markets. And fifth, we executed the Wolf Compute and Flash Compute financings. These transactions demonstrated that contracted, credit-enhanced AI infrastructure supports scalable and repeatable capital structure.

Operationally, we delivered Den and CB1, began recording HTC revenue, and have now delivered CB2A for Core 42. We are building, delivering, and contracting simultaneously. And since year end, we added approximately 1.5 gigawatts of additional power-backed capacity in Kentucky and Maryland. Now let us talk about what actually differentiates us: power and execution. The AI buildout is not constrained by GPUs. It is constrained by power, interconnection, transmission, increasingly new generation. That is why Morgantown matters. Morgantown is not just another data center site. It is a former coal generation facility in the Washington, D.C.–Northern Virginia corridor, one of the most power-constrained data center markets in the world.

Our phase one vision includes approximately 500 megawatts of new dispatchable generation, 250 megawatts of battery storage, and 500 megawatts of data center load, followed by a similar phase two. Critically, the site is being engineered to operate as a net generator to the state. We are not just consuming capacity. We are adding it. In constrained markets, that is the only sustainable model at scale. This industry is moving towards integrated bring-your-own-generation campuses. We are well ahead of that curve because we are fundamentally a power company that builds and operates digital infrastructure, not the other way around. We know how to permit generation. We know how to build generation. We know how to operate generation.

We understand grid behavior, and we know how to integrate generation, storage, and compute in a way that works for customers and regulators. There are very few teams that can do that credibly and at speed. We are premier among them. Turning to Kentucky. Demand is extremely strong. We are engaged with every major hyperscaler and several large AI compute platforms. A data room is open. Diligence is active. Conversations are robust and substantive. This week, we met directly with Governor Beshear and state leadership. The alignment at the state and local level is clear and constructive. Kentucky understands the economic and strategic import of power-backed AI infrastructure.

This is a 480 megawatt campus with immediate power availability, expansion potential, and strong state support. We are excited and highly confident in the long-term value of this asset. While we execute on the platform, we are consistently evaluating a constant pipeline of additional opportunities. We review hundreds of sites, and most do not meet our standards. We are disciplined around four key elements: power control and durability; scalability in 250 to 500 megawatt phases; signed credit-backed contracts—we do not speculate; and capital efficiency. We turn sites away all the time. But when we do find one that meets these criteria, we move decisively.

Importantly, we already control the sites necessary to deliver our targeted 250 to 500 megawatts of contracted capacity annually through the end of the decade. The runway is in place. Growth from here is execution. Finally, we are building the team to match the ambition of the platform. We recently added a senior data center construction lead from Meta, and have strengthened origination, project management, commissioning, and cybersecurity capabilities. This business is won in the trenches of engineering detail, construction discipline, and operational rigor. We are staffed accordingly. So in summary, the strategy is clear. The sites are secured. The capital is in place. Customer demand is strong. The team is built.

Now it is about disciplined delivery, turning contracted megawatts into energized capacity and durable recurring cash flow. With that, I will turn it over to Nazar.

Nazar Khan: Thank you, Paul. Let me start with delivery and risk compression. WOLF DEN and CB1 were delivered in the third quarter and generated revenue throughout the fourth quarter. CB2A is operational, and CB2B is expected to be fully online in March. By the end of the first quarter, all Core 42 will be energized and revenue producing. Following contract execution, Core 42 requested incremental fit-out enhancements. We adjusted sequencing accordingly. The monthly recurring charge was revised, no penalties were triggered, and revenue commencement remains aligned with the customer's deployment schedule. Turning to the FluidStack buildings, CB3 is expected to deliver in mid-May. After signing, the tenant finalized certain design optimizations, which we incorporated without changing building footprint or lease economics.

The associated revenue timing impact has been incorporated into the financial model. Importantly, CB4 and CB5 were designed collaboratively with the tenant from inception. These buildings reflect a fully standardized, repeatable design and represent the majority of contracted Wolf Compute capacity. Several structural improvements materially reduce execution risk. First, electrical redundancy has been optimized and standardized. Second, trade stacking and sequencing have been refined to minimize rework. Third, long-lead equipment was procured after final design alignment, and fourth, mechanical and electrical systems now follow a repeatable installation model. Execution risk declines as design standardizes, and CB4 and CB5 reflect a mature, optimized build. Both buildings remain on schedule with targeted lease commencement dates of third quarter 2025 and 2026, respectively.

Through design optimization, we increased critical IT capacity from 162 megawatts to 168 megawatts per building without impacting the base construction budget. That incremental 12 megawatts across the campus is expected to generate approximately $200 million of additional lease revenue over the initial term. Finally, Abernathy, our joint venture, remains aligned with its fourth quarter 2026 lease commencement and continues progressing under fixed EPC structure, which further limits construction cost variability. Execution requires managing scope, timing, and cost in real time. We have incorporated adjustments transparently and remain focused on disciplined delivery. Large-scale AI infrastructure requires active management of scope, schedule, and cost. We have incorporated refinements transparently, preserved economics, increased capacity, and maintained budget integrity.

Execution remains disciplined and on track. With that, I will turn it over to Patrick.

Patrick Fleury: Thank you, Nazar. The 2025 is transformational for the company. We secured over $12.8 billion of HPC lease agreements, executed $6.5 billion of debt and equity-linked financing, and materially strengthened our balance sheet liquidity while carefully managing and minimizing dilution. Let us begin at a high level before diving into the financial details. We are a business in transition and executing on rapid growth. The 2025 results still reflect a meaningful contribution from Bitcoin mining and its inherent volatility, including commodity pricing and complex network difficulty dynamics. Over time, that volatility will decline as long-term credit-enhanced HPC revenues become the dominant driver of results.

Importantly, while mining introduces revenue volatility, its flexible load profile has been strategically valuable at Lake Mariner, supporting demand response participation and power cost management. Mining is not our long-term growth focus, but it has enabled the transition. The 2025 results of operations reflect that transition in motion, and the balance sheet reflects that we have the capital structure to execute. In 2025, revenue was $35.8 million, down from $50.6 million in Q3 2025, primarily driven by lower Bitcoin production. Importantly, HPC lease revenue increased to $9.7 million in Q4, up 35% from $7.2 million in Q3. For the full year, revenue increased 20% to $168.5 million from $140.1 million in 2024.

The digital asset revenue was $151.6 million and HPC lease revenue was $16.9 million. We commenced HPC leasing in July 2025 and had energized 18 megawatts of critical IT capacity as of year end. As additional buildings come online, revenue mix will continue shifting towards stable, contracted HPC revenue. Cost of revenue, exclusive of depreciation, increased 10% from $17.1 million in Q3 to $18.9 million in Q4. Demand response proceeds recorded as a reduction in cost of revenue decreased to $4.4 million in Q4 from $7.44 million in Q3. For the full year, cost of revenue increased 33% to $82.7 million in 2025, compared to $6.1 million in 2024, primarily due to higher realized power prices.

Demand response proceeds also increased year over year from $8.6 million in 2024 to $17.7 million in 2025. Operating expenses increased as we scaled the platform to support HPC deployment. Quarter over quarter, operating expenses rose to $8.8 million from $4.5 million. Full-year operating expenses increased to $19.7 million in 2025 from $7.6 million in 2024, reflecting staffing and operational readiness. For context, TeraWulf Inc. finished 2024 with under 100 full-time employees and will exit 2026 with close to 300 full-time employees. Let me address the HPC leasing segment profitability. As presented in Note 19 of our 10-K, the as-reported annual segment profit margin is approximately 42% versus our long-term guidance of approximately 85%.

That difference is driven by three factors: first, $1.2 million of tenant fit-out revenue and associated costs during 2025; TFO carries a modest margin as provided for under the HPC agreements. Second, $4.1 million of development and pre-revenue operating costs. Third, partial-period revenue contribution as buildings rent. Adjusting for those factors yields approximately 77% segment profit margin in 2025, which is consistent with ramp expectations and converging toward our 85% steady-state margin guidance as utilization stabilizes. SG&A expense also increased as we scaled the platform to support HPC deployment. Quarter over quarter, SG&A expense rose to $66.6 million from $16.7 million. Full-year SG&A expense for 2025 totaled $147.8 million, up from $70.6 million in 2024.

After adjusting for stock-based compensation, SG&A increased from $39.7 million in 2024 to $94.5 million in 2025. This increase is primarily attributable to an incremental $47.5 million of new hires, strategic growth performance, and milestone-based employee compensation in 2025, reflecting the notable scale of execution achieved during calendar 2025. Adjusting for this item results in total SG&A of approximately $47 million in 2025, in line with our prior guidance of $50 million to $55 million. Depreciation increased to $88.6 million in 2025 from $59.8 million in 2024, reflecting infrastructure placed into service and accelerated depreciation of $19.6 million associated with certain mining assets transitioning to HPC use.

Interest expense in Q4 was $62.4 million compared to $9.8 million in Q3, and we recognized interest income of $31.5 million in Q4 compared to $4.1 million in Q3. Annual interest expense for 2025 and 2024 was $80.2 million and $19.8 million, and we recognized interest income of $39 million and $3.9 million, respectively. The increases in net interest expense were expected following our capital raises at TeraWulf Inc. and Wolf Compute in 2025. Actual cash interest paid during Q4 and calendar year 2025 was $6.9 million and $13.9 million, respectively. Change in fair value of warrant and derivative liabilities in 2025 was a loss of $429.8 million, primarily related to the Google warrant.

This is a non-cash loss and therefore does not affect our liquidity. Equity in net loss of investee, net of tax, for 2025 is $4.1 million, which represents TeraWulf Inc.’s 50.1% share of the net loss of the Abernathy joint venture, which was formed in October 2025 and has not yet commenced operations. Our GAAP net loss in 2025 was $661.4 million compared to a net loss of $72.4 million in 2024, with the increase primarily driven by non-cash fair value adjustments related to the Google warrant and non-cash depreciation. Our non-GAAP adjusted EBITDA in 2025 was negative $23.1 million, down from positive $60.4 million in 2024.

As a reminder, these results are inclusive of significant increases in SG&A and operating expenses over the past twelve months as we invest heavily in our HPC initiatives. Turning to the balance sheet and liquidity. As of 12/31/2025, cash and restricted cash totaled $3.7 billion. Total assets amounted to $6.6 billion with total liabilities of $6.4 billion. Regarding liquidity, as detailed in our fiscal year-end 2025 investor presentation, on the slide titled Capital Structure, as of 01/31/2026, the holdco parent entity had approximately $500 million of available cash, or approximately $300 million pro forma for the Kentucky acquisition announced on February 2.

Regarding project-level capital positions and construction progress, both Wolf Compute and Abernathy are fully funded through substantial completion with long-term fixed-rate financing, eliminating construction funding uncertainty and reducing reliance on near-term capital markets access. Importantly, we do not anticipate the need for additional equity to fund our currently contracted development. As of 01/31/2026, Wolf Compute had approximately $3.0 billion of gross cash, or $2.6 billion net of debt service reserve and interest-during-construction accounts, with $850 million of CapEx spend complete and $2.38 billion remaining. That leaves approximately $200 million of cash cushion, which is incremental to the substantial contingency embedded in the financing structure.

As Nazar noted, schedule adjustments resulted in approximately $16 million less projected revenue in years 2025 through 2026. However, design optimization has increased capacity from 162 to 168 critical megawatts across CB4 and CB5, generating approximately $200 million of incremental revenue over the initial lease term. The net effect improves projected cash flows and reduces expected debt at maturity by approximately $45 million versus prior projection. Finally, with regard to the Abernathy JV, as of 01/31/2026, the JV had approximately $1.5 billion of gross cash, or $1.2 billion net of debt service reserve, interest during construction, letter of credit, and holdco lockbox account, with $268 million of CapEx spend complete and $1.1 billion remaining.

That leaves approximately $70 million of cash cushion at Flash Compute, with a further $100 million liquidity reserve at the parent JV supported by a $1.35 billion lump-sum EPC contract with HypoFact. With respect to Kentucky, we have proposals in hand for secured loan facilities to fund pre-lease development to preserve holdco parent liquidity. Demand for near-term power remains strong, and we are targeting 480 megawatts online in 2027. We do not build on speculation. In summary, 2025 reflects a business transitioning from volatile Bitcoin mining revenue to stable, contracted HPC revenue. Mining has strategically supported that transition. Contracted HPC revenue is ramping. Liquidity and contingency are strong. With that, operator, we are ready to take questions.

Operator: Thank you. At this time, we will be conducting a question-and-answer session. If you would like to ask a question, please press 1 on your telephone keypad. You may press 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Our first question comes from Michael John Grondahl with Northland Securities. Your line is now live.

Michael John Grondahl: Hey, guys. Thank you. First, I just wanted to start with Kentucky. That site sounds like the reception has been strong. Could you give us a few more details on the site and what an ideal customer or lease would look like there?

Paul Prager: Mike, this is Paul Prager. It is a fantastic site. This was the site of a former smelter. It is at a transmission superhighway. Multiple utilities can service the property. What was most compelling about it was its central location and the immediate availability of power in scale. Demand for the site is extremely strong. Our data room is open. Every major hyperscaler and several large AI platforms are doing diligence. The conversations to date have been substantive, with some written term sheets already coming over the desk. Earlier this week, I was down in Kentucky. I met with Governor Beshear and state leadership. The alignment at the state and local level is clear, very constructive, very, very, very pro-business.

The importance of this project for the local community, particularly the public schools, which Kentuckians are super proud of, is massive. We held a community info session two nights ago. We had a job fair yesterday. We filled the auditorium, and then some. We are extremely excited and confident in the long-term value of the asset. As Patrick has said from day one, we are all focused on the best financial credits to be our long-term customers. I think we have operated that way in the past, and that is the message going forward. I think you will see a world-class credit as our next customer for what we are hoping to be a 10 to 15 year deal.

I think we will see that deal happen pretty soon. I do not want to give you a drop-dead date, but we are in very, very active and substantive discussions.

Michael John Grondahl: Great. And then secondly, the Maryland site seems like a lot of potential up to one plus gigawatts but a little bit more complex. And kind of playing into what you guys have talked about, you know, bring your own power. How does that play into some of TeraWulf Inc.’s strengths?

Paul Prager: Sure. You know, just to be clear, Chesapeake Data, it is about the power and load differentiation. It is a gig site, with certainly a gig data center load capability, 500 megawatts of battery storage capability. It is a former coal generation campus. It is in the Northern Virginia corridor, which means prices are exceedingly competitive. It is designed to be a net contributor to the Maryland grid. It is very well supported by Governor Moore and MDE.

Again, both Maryland and Kentucky, by the way, have very sophisticated brownfield programs, which make it really easy for a guy like us who has been around the block and owned and operated coal-fired power plants, shut them down, mitigated them, did everything the right way. These two states have very, very progressive programs on how we do that at commercial feasibility. Listen. The market is moving to bring your own generation. We said that a year ago. In December, Alphabet bought Intersect for almost $5 billion. In January, Microsoft raised dedicated generation as part of their five-point infrastructure strategy. President Trump in January floated the notion that PJM emergency auctions needed to incentivize new generation.

New generation projects would go to the top of the queue for interconnect. And then just the other night, in the State of the Union, the President stated data centers need to build and fund their own generation. So that is where the world is going. We have a real and growing power shortfall. Morgan Stanley says potentially 47 gigawatts 2025 to 2028. The hyperscalers are openly stating that power is the binding constraint. Look at anything: recent public commentary by Clid Crews, Vividia CFO; Sundar, Alphabet CEO; certainly Jensen Huang, NVIDIA CEO. It is all about we need power. So delivering generation alongside that load solves the problem.

We could bring incremental megawatts to the grid or the system, dispatchable generation using CCTTs, not just bridging power, and we have a history of partnering with grid operators to solve reliability and adequacy challenges. What is our core competency? We have been talking about this. This is the only team out there. For 25 years, we have been developing, building, renovating, rescuing generation. Six gigs of power generation experience on this team together on this team, and it has been over 25 years.

We have deep expertise in siting, interconnection, generation development, and that is why we could go and take on a project like Morgantown and have the support that we can from both the local and state communities as we pursue this. We are really excited about Morgantown. It is a big job, but it fits into our schedule. And, again, we have told the world we are 250 to 500 incremental megawatts of data center load every year, and this fits right in.

Michael John Grondahl: Hey. Really helpful, and all the best for 2026, guys.

Paul Prager: Thanks, Mike.

Operator: Our next question comes from Timothy Horan with Oppenheimer. Your line is live.

Timothy Horan: Thanks, guys. Do you think the pricing in terms and conditions in Kentucky can be materially better than what you have done in the past? And the construction schedule seems pretty ambitious. Do you have the labor and all the equipment you think you will need and, I guess, the permits to get it done? Thanks.

Paul Prager: So I think I will go first and maybe, Naz, you can go second. In terms of the labor, yes, Kentucky is a fantastic—it is just a fantastic place. You have not only the construction expertise, the trades expertise, but you have people that really want to work. We brought on to that job Fluor, which I consider to be a world-class contracting party. We have dealt with them in the power space for a long time. They have relationships along in our C-suite for many, many years at every level. We are already ahead of the curve in sort of procurement. We have a proven design that our hyperscaler customers really like.

And we think because it is immediate available power—well, we do not think. We know because we have got this very robust conversation going on right now with folks that want to come in and be our customers there—for competitive pricing. Naz?

Nazar Khan: Yes, and just to add to what Paul said, as Paul said, we brought in Fluor on the EPC side. So we are already hitting the ground running with respect to the overall development of the project. And so the timelines that you see for 2027 are reflective of ongoing and meaningful discussions already with the EPC. So we feel pretty good about the overall timeline. The other big component is gathering the labor that is going to support the project as well. And so there have been efforts already underway for both the mechanical, electrical, and civil scopes to get the requisite labor to support the project as well.

So that date is informed by quite a bit of discussion that we have had with Fluor, who is our EPC, as well as the work that we have done on-site since the acquisition. In terms of just the overall economics, I think we said these on prior calls. We really think about these projects on an unlevered-yield basis. And so if you look at where we have been historically, we think we will be in that ZIP code, or maybe better over time.

But, again, as we think about the overall economics of a project, we are always kind of zeroing in on what is the unlevered yield that we are developing at, and pushing to maintain and continue to increase that as well.

Timothy Horan: Thank you.

Operator: Our next question comes from Christopher Charles Brendler with Rosenblatt Securities. Your line is live.

Christopher Charles Brendler: Hey. Thanks so much, and congratulations on progress here. I wanted to ask on a couple on the power side. First, I noticed that the PUE across all these sites is right in line with the initial deals at 1.25, and you mentioned in the slides that is best-in-class. And my understanding was there were certain aspects of, like, Mariner and Cayuga that drove that 1.25, but maybe I am mistaken. It seems like it is standard for TeraWulf Inc. to operate at that incredible efficiency. Can you just give us a little color there on why you are able to run circles around your competitors when it comes from a PUE standpoint? Thanks.

Nazar Khan: Sure. Hey, Chris. It is Nazar here. So there are a couple of factors. As you noted, one is just the geographic location. And, again, as we are more in the northern half of the country versus southern half of the country, there are benefits from an ambient conditions perspective with respect to the design and being able to meet that peak PUE. You will see the Abernathy site is at a 1.4 PUE, again, which is reflective of just the geographic location. In addition to that, we have invested heavily on the cooling side as well. So we are giving ourselves extra room on the design that we have on cooling as well to maintain that lower PUE.

So in general, as we think about where we are for, generally kind of in the northern half of the country where we have these off seasons during the winter and the spring and where the summer is not sustained heat, we think we can maintain that 1.25 PUE.

Christopher Charles Brendler: Okay. Was there also a redundancy aspect to it? Are you still not using big diesel generators in these sites?

Nazar Khan: That is correct. And, again, that gets back to these brownfield sites. So, typically, you are seeing us play at brownfield industrial sites. And the way to think about it is when the smelter was there, there was a significant investment to design and build the smelter at that site. The last thing that Century wanted was a single point of failure on power coming into the site. No different than a data center. Right? So there are five different lines coming into that site, which provides a considerable amount of redundancy. When we look at sites like that, we see that there are multiple independent pathways for the delivery of power, which obviate the need for on-site backup generation.

So, again, Morgantown, similar. Used to be a former coal-fired power plant. That 1.5 gigawatt coal-fired power plant did not want to have single point of failure in getting power out. We are utilizing that same system now to bring power back in. So the big benefit with these former industrial brownfield sites is that usually they have that built-in redundancy that data centers want as well.

Paul Prager: I just wanted to thank you for that.

Christopher Charles Brendler: I see. Totally. I just want a quick one.

Paul Prager: Question regarding PUE because, you know, we put a page in the deck called Critical IT Capacity, the metric that matters. And what we are going to be trying to do and really ensure that is straight in our retail shareholders’ understanding: gross megawatts measure scale, but it is critical IT megawatts that measure monetized execution. And we think of TeraWulf Inc. as an execution story. So we are really going to be reporting more in the context of critical IT as opposed to just gross megawatt capacity. We think it is farm sense.

Christopher Charles Brendler: Great. And one more quick question is the half gig of battery power sort of caught my eye. Can you just give us a little color on why and what that means?

Nazar Khan: So as we are adding these large loads, and if you see in the statements that we have made, we want the site to be overall a net supplier of energy back to the grid and to the state. So having that battery storage allows the load at the site to operate in a way not really impacting peak demand. And so it is kind of a critical peak demand shaver, which we think, again, provides—makes the loads assets back to the grid rather than burdens. So we think the right composition is about a half a megawatt of storage per megawatt of load.

And so that is why you see in each of the phases at Morgantown, for every megawatt of load, there is about half a megawatt of battery storage.

Christopher Charles Brendler: Alright. That is great. Thanks so much, and congrats on 2025 transformational year. Looking forward to 2026. Thanks, guys.

Operator: Thank you. Our next question comes from Nicholas Giles with B. Riley. Please proceed with your question.

Nicholas Giles: Great. Thanks, operator. Guys, I want to congratulate you for the progress across all fronts. Maybe just following up on that last one. Nazar, you mentioned the battery storage, and there just appears to be some different moving parts at Chesapeake. So can you just give us a sense for how CapEx could differ from Mariner and what you are doing to really de-risk that development? Thanks.

Nazar Khan: Sure. So as we think about the composition of Morgantown, as you noted, there are a few different legs here versus what we are doing at Lake Mariner or other sites. On the data center side, we are in that $8 million to $10 million per megawatt range for CapEx. And so that is what we have done at Lake Mariner, at Abernathy, and as we look to contract Kentucky, we are in that same range. In Morgantown now, we are adding two incremental legs. One is the power generation side, and the second is the battery storage.

On the power gen side, we are going to be somewhere in the $2 million to $3 million per megawatt range for the fully delivered power plant. Part of that will be timing. Part of that will be the type of turbines that we are deploying, and we are working on a number of different alternatives for that site as we speak. But that will be around $2 million to $3 million per megawatt for that capacity. And there is about another million or so dollars per megawatt on the critical IT load, so the battery storage is usually priced on a megawatt-hour basis.

But when we translate it back to just the overall load, that is around another $1 million. And so when we think about what we are offering back to our customer, it is the data center that they are already paying for in other deals that we have, that $8 million to $10 million per megawatt range. In addition to that, now it is the components on the generation side: $2 million to $3 million per megawatt on the dispatchable gas-fired generation, then another $1 million or so on the battery storage. So all in around $13 million to $14 million per megawatt on a fully loaded basis.

What that does, kind of embedded within that, we will be seeking to charge that full cost back in a capacity payment back to the underlying customer. So they will effectively now be long the value of the generation, as well as long the capacity in the data center. With the grid connectivity, we will have now the ability to both bring the power in from the grid as well as generate more than enough power to that load going out. And so on a net basis, we think over time, the net cost of power that the tenant will realize will be meaningfully lower than just a grid solution only.

So on the ins and outs, again, they will be paying a capacity payment for all of the CapEx, both on the gen side as well as the data center. But they will be long the value of that gen, the value of that energy, and that will be offset by whatever they pay for the power coming in. So net-net, we think it is a very strong position. It gives the tenant a quicker path to scale up in scale—that gigawatt is a large amount—and we think over time their net cost of power will be meaningfully lower than a solution that is relying on the grid only.

Nicholas Giles: That is really—appreciate all that detail. I am sure others will have follow-ups. I just wanted to squeeze one in on the regulatory side. I think you still need approvals from FERC at Morgantown. Can you just walk us through what the timing looks like there and how we should think about what you ultimately need to get across the finish line from a third-party perspective?

Paul Prager: Yes. It is a pretty pro forma approval process that we have done countless times. It happens anytime you transfer an existing power facility to another party. They tend to look for things like regional monopoly in the area, stuff like that. We are not. We consider this to be just pretty routine. We would expect FERC approval within three to six months.

Nicholas Giles: Great. Okay. I am sure PJM is glad to have you back, and, guys, congrats again on all the progress.

Operator: Our next question is from Stephen William Glagola with KBW. Your line is live.

Stephen William Glagola: Hi. Thanks for the question. Can you update us on any remaining zoning requirements or state and local approvals needed to move forward with the Hawesville data center campus? That is one. And then two, separately, while you guys already received zoning approval, are there any additional permitting or regulatory steps still outstanding for that site? Thank you.

Paul Prager: We will go backwards. I will start with Cayuga. And in Cayuga, we had our first informal session with the planning board a couple of nights ago. It went very well. They were engaged. They asked good questions. And so that process is one where you go ahead and finalize your application. That will take another month or so. They then meet on it. They review it. We come to an agreement together on what that permit should look like. They will be solving for certain conditions, like, are you drawing water from the lake? What will noise levels be in the midst of operation? What are you doing for the site in terms of beautification? Things like that.

These are all reasonable things. It is what we do. It is what any company in redeveloping a former power plant or industrial complex does. The Cayuga process, as you know, first had to go through zoning board approval to ensure that it was consistent with the definition required to achieve a permit. It did win the day on that. And so we are just ordinary course routine, working together with the planning board of the town to move forward. With respect to Kentucky, Naz?

Nazar Khan: Yes. So on Kentucky, Stephen, from a permit perspective, we have to obtain the requisite building permits. That being said, we had a town hall this week in Hawesville. We had a workforce session for potential employees. And so the entire judge executive and economic development director in Hawesville are all fully on board and very eager to get us going. As Paul mentioned earlier, it is an extremely supportive environment. And so while we do not have the permits in hand, everyone is fully aware of what we are doing. We briefed them on both the scope, size, and scale of the buildings that we are bringing.

Importantly, as a part of what we are doing at Hawesville, we are also decommissioning and taking down the old aluminum smelter. So there is a big cleanup that is happening at the site as well, which the town is very eager to have happen. So, yes, we have to do all that, but that is going to come in time. We are expecting as soon as we can get this lease signed up, we will be in a position to submit all those things. We have previewed a number of those things, and we are hopeful that it should be a pretty smooth process to get approvals around that.

Paul Prager: Just two more things. One is with respect to both of these projects, there is not just one permit you get. There is a principal notion of a permit for a facility. But all along the way, whether it is a specific demolition permit or a building permit for a particular structure, you need to get local permits. The second thing I just wanted to mention about Cayuga, which is kind of interesting, as the state has become really a popular place for people and they look forward to doing more data centers there, they are starting to come with this notion of what about power. The beautiful thing about the Cayuga site is it was a former power site.

It can be again. We have the ability both in terms of the landlord’s huge site, which is 400 acres, we have the ability to bring in our own power generation if that was ever something important to state or local constituents. So Cayuga is, I think, really a much better site than just any other one in terms of that part of the world because of its ability to house a power plant on it if it is needed.

Operator: Great. Thank you. Our next question is from Darren Aftahi with Roth. Your line is live.

Darren Aftahi: Hey, guys. Thanks for taking my questions. First one, if I may. Could you kind of characterize the maybe competitive process at Hawesville, maybe comparing that to Lake Mariner? And are we talking about one entity taking the three— It is going to be multiple entities? And then I have got a follow-up. Thanks.

Paul Prager: Yes. I will start maybe just by giving you the environment that we were contracting for Lake Mariner. I think we were very, very confident we had a really special site. But I think the hyperscalers were on the growth curve in terms of education. They were on the growth curve in terms of figuring out design. When we started Lake Mariner, I think people were not as rock solid in their design notions or in terms of how they would fill out their customers’ ledger. So I think we are in a very different environment now.

We are in an environment where the hyperscalers are—I mean, this is as competitive a market as I have been in over the course of the last 45 years. I mean, you have got Meta very aggressive. Google has got a great program. Amazon has got a great program. Microsoft has come back into the market. They are extremely competitive. You have got some of the neos that are really seeking larger and larger facilities. So we are in a much more competitive environment where the customers actually have much more definition to what it is they want.

The second thing is, when we started out with Lake Mariner, we had already built some buildings a little bit, and so we had to work with our customers, for instance, in WOLF DEN and CB1 and 2, on figuring out the design elements that they wanted, even in CB3. Whereas 4 and 5, we built those buildings from the ground up with the customer, which made the whole procurement and build process that much more efficient. So I would tell you, we have a much more committed and sophisticated customer right now who knows the design needs that he or she wants, and we are in a much more competitive environment.

So we are pretty excited about—what the beautiful thing about Kentucky is its immediate availability has just enabled a very robust dialogue for us in terms of filling out our customers. But, Naz, do you want to add something?

Nazar Khan: Yes. The only thing to add, Darren, is we are targeting one, maybe two customers for the entire site.

Darren Aftahi: That is helpful. And then just as a follow-up, I mean, so you have given—you have kind of raised your bogey and given this 250 to 500 range. I guess, what are the one or two deterministic factors that kind of drive that range? And given your background in power as a team, is there any reason we could think maybe there is upside to that range? I am just trying to get an understanding of what that context really means. Thanks.

Nazar Khan: I can start here, and then Paul, you can jump in. The 250 to 500 is a very kind of calibrated range that we are giving you. It factors in the operational and deployment capabilities. Again, this is getting hundreds of people on-site across multiple trades. It is a procurement process around equipment and ensuring that we are not the last buyer, but we have quite a bit of room between what we need and where the market has availability. And then from a financing perspective, it is what the company can bear from an accretive perspective.

So when we talk about 250 to 500 megawatts per year, that is $2.5 billion to $5 billion of incremental capital per year that we are guiding the market that we are going to spend every year for the next few years. And so when we talk about this 250 to 500, it really is a calibrated guidance around all of the various facets that are required to properly execute and deliver upon capacity. So that is where we are. That is what we see is available. A year and a half or so ago, we were guiding at 100 to 150.

As we have been able to now deploy capacity and understand the needs of customers, we have upped that guidance to 250 to 500. We remain very confident that every year for the next few years, we will continue to sign up another 250 to 500 megawatts of critical IT load with customers, deliver that 12 to 18 months hence, and do that year over year, and continue to grow shareholder value as we are doing that.

Paul Prager: Yes. I would want to add a few things. Number one is, we selected Fluor to be our contractor in Kentucky. Why? Because we think they are the most skilled contractors in the country. They are particularly good on the front-end projects so that the execution side goes flawlessly. I think as we move forward, the notion of the selection of Fluor was scalable growth so that we could work with them on additional projects on a national level. The second thing is we are all about execution. Again, whether it is on the development side or the execution side, we could talk as much about our pipeline as you want.

We could talk as much about all the projects that we are reviewing before we decide to make a move. But at the end of the day, if we do not deliver for our customers, we are out of business and we have failed our investors. So we need to be conservative here because we are still a nascent business. We have seen changes in the design of our facilities just between CB2A, B, 3, then 4 and 5.

And so I think as we are learning and growing in partnership with our customers and now our leading contractor in Kentucky, we will continue to enhance our execution capabilities and, if there is an opportunity to grow beyond what we have said is 250 to 500 incremental critical IT load, then we will. But for right now, we have to keep our eye on the ball. The table is full of lots of cookies and cakes and candies, but we have to stay focused on the meat and potatoes and deliver for our customers.

Darren Aftahi: Appreciate the insight. Thanks, guys.

Operator: Our next question comes from Brett Anthony Knoblauch with Cantor Fitzgerald. Your line is live.

Brett Anthony Knoblauch: Hi, guys. Thanks for taking my question. Paul, I guess you have multiple attractive sites that you could see where you can go and lease out now. I guess in talking to prospective customers, is there a reason why they would want maybe the Kentucky site over Lake Cayuga or maybe the mega campus that you are building in Maryland? And has—in your mind—what maybe site is next up for grabs changed? Has kind of Kentucky jumped to the top of the list?

Paul Prager: Listen. So first off, the answer is the demand is so significant. I think that a party would be happy to take everything off the table at any one time. But it is about time to power. And that is why Kentucky has become so important to the customers that we are in discussion with. The ability to have that kind of scale within this short period of time, or have it promptly, if you will, just makes it one of the most exciting sites in the country. One thing that we have been pushing, Brett, is we like regional diversity. We think hyperscaler customers are getting focused on that too.

We think they have seen now, they have experienced what happens—first in Ohio and then now down in ERCOT—when you get everybody all in one place. It is a question of security, but it is also a question of can the grid really handle it. And so I think having regional diversity is something that our customers find compelling. And that is a good reason for them to really focus on Kentucky. That and the immediacy of its power.

Brett Anthony Knoblauch: Awesome. And then I think in the prepared remarks, you said that Kentucky could potentially expand beyond the 480. To what extent have you guys looked into that and how much do you think it could expand beyond 480?

Paul Prager: I think—listen. We have talked to our power suppliers there. We understand the grid there. I think that—and again, I was just with the Governor a couple of days ago, and he is really terrific. He runs DGA. He is very commercial. He is very pro-business for the state. I think that we will have opportunities to expand our footprint both on the generation side and on the customer side in Kentucky. But, again, I have to stay focused. Right? My job is execution. I have got to deliver these facilities to our customers, and we are doing that at Lake Mariner. And Kentucky is going to be a very prompt bid.

We have already issued a limited notice to proceed to Fluor, just because our customers really want to get onto that property. So we are doing everything we can to facilitate that. Just going to really focus on execute.

Operator: Awesome. Thank you, guys. Congrats.

Brett Anthony Knoblauch: Thank you.

Operator: Our next question comes from Michael Donovan with Compass Point. Your line is now live.

Michael Donovan: To what you are talking about, Paul, on sizing and design plans. For Maryland and Kentucky phase buildouts, what is the target critical IT megawatt per building or hall you are thinking about today? Should we think about repeatable modules similar to FluidStack? And what drives that sizing decision? Thanks.

Nazar Khan: Yes. It is Nazar here. So in the FluidStack context, that 168 megawatts of critical IT load is the base design that we worked closely with them on developing. You have seen that number pop up subsequently with other of our peers as well. But in that context, that is kind of the base design. That puts you a little over 200 megawatts of gross capacity. And so in general, as we are having discussions with various customers, we typically look at that 200 megawatt gross, 160 megawatt net as kind of a building block that we are building off of.

And so the designs that we are working on with Fluor really incorporate that, again, roughly 200 megawatts plus or minus gross, 160 megawatts plus or minus net, critical IT megawatts as the base building block from which we are deploying. And so when we talk about Kentucky, for example, in that 380 of net, that is a couple of those buildings that would kind of consume that capacity.

Michael Donovan: Appreciate that.

Operator: Our next question is from John Todaro with Needham and Company. Your line is now live.

John Todaro: First one is more high-level political regulatory. Sounds like really good conversations with the governors in Kentucky and Maryland. Just wondering, though, more at a broader level, how you are viewing some of the pushback at the state level to data center builds. Just any commentary there whether the media articles might be overblown or if there is some risk there.

Nazar Khan: So it all requires, I would say, thoughtful and careful engagement. How you bring your load on is critical to how you are perceived and what impacts you have. And so if you have been listening to us for the last few years when we talk about Bitcoin mining, we said from the beginning, there is a way to do Bitcoin mining that is accretive and an asset back to the grid, and there is a way to do it where you are not.

And so we have been very engaging with—I mean, for example, in Kentucky, we spent a tremendous amount of time with the energy supplier there, Big Rivers, and have developed a very close and strong working relationship with them where we are kind of aware of the challenges they have on committing to supporting a large load. And if it is there, it is great. And then when it is gone, it is not so great. That is A. And so ensuring that our interests are aligned with them and they have clear visibility on where we are.

And then B, just in terms of the overall load profile and when you are consuming power and what happens at those peak demand hours. And so we have been very, again, thoughtful in thinking through how does our load and where we are locating these loads tie back to what is happening in the grid around it. And how do we ensure that, again, our loads can be overall assets and beneficial back to the grid and to the local communities versus coming in and being burdens. And so I think the articles—the news is news. It kind of comes out how it comes out.

But we pride ourselves in trying to be very thoughtful around the issues that we think are pertinent and properly addressing them. And so, hopefully, over time, you will see, even in Kentucky, based upon how we are structuring things with the local utility down there, that it hopefully becomes a model for how things should be done and an example of how data centers should be integrated back to grids.

John Todaro: Great. Thanks for that. And then second one is just on kind of where we are in the headcount growth for Kentucky and Maryland and just where you frame up some of the G&A guardrails there?

Nazar Khan: So we are in the early stages on both. We have kind of ramped up the Kentucky team to half a dozen or so folks. Over time, including the on-site personnel, that is going to be over 100 people for Kentucky by itself. Of our sites, we are targeting somewhere in that 100 to 120 people range for fully loaded staffing once the site is fully operational. And we are probably a couple people in Maryland right now. As was noted earlier, we are pending FERC approval to take over the site. There is existing generation at the site. And so we are ramping that team up to support the operations as well.

So I would say we are in a couple dozen people between the two sites now, but that is quickly increasing. And, again, we should be hitting towards the end of the year, early next year, we should be hitting pretty sizable numbers in Kentucky, and we will be in that 100 people range at Kentucky by this time next year, I would guess. We have also, of course, added at the corporate level so that we can manage the much larger portfolio and stay on top of everything from procurement to legal to accounting to IT. It is everything that you need at the corporate level to manage projects at this scale.

John Todaro: Understood. Appreciate all the detail. Thanks, gentlemen.

Operator: Thank you. Our final question is from Martin Toner with ATB Capital Markets. Your line is live.

Martin Toner: Thanks for taking the question. When do you think phase one of Morgantown might be able to be turned on?

Nazar Khan: We are working through that as we speak. So at Morgantown, in addition to the three legs we mentioned earlier—kind of the load, the data center, the gas gen, and the battery storage—there is also a remediation that goes along with that. We were with the MDE just this afternoon and kind of scoping that out. And so once we get definition around the timing and scope of that remediation plan, that will then feed into the timing. If you look at what we said in the deck, we have kind of positioned this as kind of 2028, kind of in 2029 and beyond. So, generally, that is where we are.

But over the next, I would say, couple quarters here, we will have greater definition to provide around specific timing on Morgantown.

Paul Prager: Coming at it from 10,000 feet, the state of Maryland had some challenges. They shut down a lot of their great generation. They were not really as pro-generation and or as prescient of what would happen as a lot of other states, which have been very, very supportive, like Pennsylvania next door. So the Governor has really changed policy. We have received written commitments for expedited permitting for our site. So I do not think this is going to be business as usual. I think they are really keen to have us come there, create jobs, both at the county level and the state level. The reception has been amazing.

They have literally given us sort of an office to work with to expedite all sorts of permitting from the repowering to the remediation.

Martin Toner: That is great. Thanks for all that detail. That is it for me.

Operator: Thanks, Martin. We have reached the end of the question-and-answer session, and this concludes today’s conference. You may disconnect your lines at this time, and we thank you for your participation.