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Bernstein raised its price target on Riot Platforms to $35 from $30 and maintained an Outperform rating, citing the bitcoin miner's $9.1 billion data center agreement with a "leading frontier AI lab" reported to be Anthropic. The 20-year colocation lease covers 191 IT megawatts at Riot's Rockdale campus in Texas and is expected to generate $457 million in annual recurring revenue. Riot shares spiked more than 27% in pre-market trading on Tuesday before paring gains to around $22.60, with Bernstein's new target implying roughly 80% upside from Monday's close of $19.40.
Why it matters
The deal is the largest single anchor contract to date in the BTC-miner-to-AI-infrastructure pivot narrative, and Bernstein's updated economics now treat Riot as primarily an AI colocation operator rather than a bitcoin miner. The firm lifted its modeled annual revenue yield for Riot's AI colocation business to $2.2 million per IT MW, from $1.5 million previously, and raised its estimated EBITDA margin to 84% from 80%. AI colocation now contributes roughly $12.3 billion, or 84%, of Riot's $14.7 billion target enterprise value under Bernstein's sum-of-the-parts model, while bitcoin mining accounts for just $1.7 billion, or 11%, and the company's BTC holdings add another $740 million, or 5%.
Market impact
The funding stack matters as much as the headline: Bernstein estimates Riot will need to raise another $3.7 billion in secured financing to fund the buildout, equal to roughly 90% of project capex. The company has already secured a $573 million interim facility from Morgan Stanley to fund early equipment procurement, and Bernstein pointed to a non-binding letter of intent with a single tenant for Riot's 1 GW Corsicana site as evidence of a "clear scale up path." To fund the buildout, Riot has been selling bitcoin production and reserves, trimming holdings from a peak of 19,368 to 11,380 BTC as of June 30, worth about $731.5 million at current prices. Financing, construction execution, and Texas concentration are the named risks; whether Anthropic is actually the counterparty, since it is reported but not confirmed by Riot, is the unresolved item the market will press on.
Frequently asked questions
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What is the Anthropic deal with Riot Platforms?
Riot signed a reported $9.1 billion, 20-year colocation lease covering 191 IT megawatts at its Rockdale, Texas campus with a "leading frontier AI lab" reported to be Anthropic, expected to generate $457 million in annual recurring revenue.
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Why did Bernstein raise its Riot price target to $35?
Bernstein cited the $9.1 billion data center agreement as a "clear scale up path," lifting its AI colocation revenue yield assumption to $2.2M per IT MW from $1.5M and its EBITDA margin estimate to 84% from 80%.
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How much of Riot's enterprise value is AI colocation vs bitcoin mining?
Under Bernstein's sum-of-the-parts, AI colocation contributes $12.3 billion, or 84%, of Riot's $14.7 billion target enterprise value, while bitcoin mining accounts for $1.7 billion, or 11%, and BTC holdings for $740 million, or 5%.
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How much more financing does Riot need for the buildout?
Bernstein estimates Riot needs to raise another $3.7 billion in secured financing to fund its modeled buildouts, equal to roughly 90% of project capex, on top of a $573 million Morgan Stanley interim facility already in place.
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How has Riot been funding its AI pivot so far?
Riot has been selling bitcoin production and reserves to help fund the data center buildout, trimming its BTC holdings from a peak of 19,368 to 11,380 as of June 30, worth about $731.5 million at current prices.
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