Riot Platforms(US:RIOT)2026-01-16 16:02Riot Platforms Business Update Summary Company Overview - Company: Riot Platforms (NasdaqCM:RIOT) - Date of Call: January 16, 2026 Key Achievements and Developments 1. Acquisition of Rockdale Site: - Completed the acquisition of 200 acres at Rockdale for $96 million, funded by selling approximately 1,080 Bitcoin, transitioning from a ground lease to full ownership [4][7][10] - This acquisition allows Riot to develop data centers on-site, unlocking 700 megawatts of fully approved power capacity [4][6][10] 2. Lease Agreement with AMD: - Announced a 10-year lease with AMD for 25 megawatts of critical IT load, with options for expansion [5][11] - The initial deployment will be delivered in two phases: 5 megawatts by the end of January 2026 and 20 megawatts by May 2026 [11][15] - Total contract value for the initial deployment is $311 million, expected to generate average annual net operating income of approximately $25 million [12][25] 3. Strategic Importance of Transactions: - The acquisition and lease validate Rockdale as a premier data center site and establish Riot as a credible operator for technology organizations [5][28] - Eliminating future rental payments of approximately $130 million enhances the operating cost profile and returns on future developments [10][28] Financial Strategy and Capital Allocation 1. Capital Allocation Approach: - Riot employs a disciplined three-phase capital allocation strategy: initial development funding, tenant acquisition and project financing, and capital recycling [19][22] - Plans to fund development projects through Bitcoin sales, maintaining substantial exposure to Bitcoin while financing growth initiatives [20][21] 2. Liquidity Position: - As of Q3 2025, Riot holds over $2 billion in total liquidity, including approximately $400 million in cash and nearly 20,000 Bitcoin [19][20] 3. Financing Strategy: - Plans to utilize non-recourse project-level debt financing for data center CapEx costs, enhancing returns on invested capital while preserving balance sheet liquidity [22][23] Market Position and Future Outlook 1. Growth Potential: - The Rockdale site has the potential to support 1.2 gigawatts of critical IT load, which could generate annualized NOI of $1.6-$2.1 billion from long-term contracted leases [30][31] - AMD holds expansion options for an additional 75 megawatts and a right of first refusal for another 100 megawatts, potentially increasing their footprint to 200 megawatts [12][30] 2. Competitive Advantages: - Riot's expertise in Bitcoin mining allows for immediate monetization of power capacity while developing data center infrastructure, providing a unique advantage over traditional developers [32][31] - The credibility of Riot's data center team and the speed of execution are highlighted as key factors in securing the AMD lease [25][26] Conclusion - The announcements reflect Riot's focus on efficient capital allocation and financial discipline, positioning the company for significant growth in the data center market while maximizing shareholder value [28][29]