TeraWulf (WULF), a US data center operator focused on bitcoin mining and AI computing, saw its shares drop early Wednesday, after the company announced a $900 million capital raise.
The firm priced 47.4 million shares at $19 each. WULF is down 5.8% to $19.73 in early trading. The underwriter greenshoe option is for an additional 7 million shares.
Alongside other AI infrastructure names, WULF has been on a scorching run, rising more than 50% since late March.
The proceeds are earmarked for funding the construction of a major data center campus in Hawesville, Kentucky, alongside repaying outstanding bridge financing and supporting future expansion.
Preliminary Q1 results
Alongside the offering, TeraWulf released preliminary first-quarter 2026 results. The company expects revenue between $30 million and $35 million. The balance sheet showed $3.1 billion in cash and $5.8 billion in total debt.
Management highlighted a growing shift toward contracted HPC hosting revenues, which now account for over half of total revenue, positioning the business for more stable, long-term cash flows.
Compass Point analyst Michael Donovan, who has a Buy rating and a $28 price target on WULF, pointed to the shift in mix toward HPC as a positive inflection point for the business, with contracted hosting revenue overtaking bitcoin mining for the first time. He also views the capital raise as a necessary step to unlock the next phase of growth. While acknowledging the dilution, he said the added funding improves visibility into the buildout of the Kentucky site, which he expects to be developed in phases based on customer demand. He added that demand for TeraWulf’s power and hosting capacity remains strong.
Looking ahead, Donovan expects the company’s revenue profile to change meaningfully as HPC scales. He forecasts that contracted hosting will become the dominant driver of revenue over the next two years, reducing reliance on bitcoin price swings and supporting a more predictable earnings stream.
The shift reflects a broader trend across the industry, as bitcoin miners increasingly pivot toward AI and high-performance computing infrastructure to diversify revenue streams and improve margins.