Cipher Mining signed a 10-year high-performance computing colocation deal with Fluidstack worth $3 billion. Google will support the build and receive a stake in Cipher. According to Investor’s Business Daily, CIFR stock fell after early gains.
Deal details and site capacity
Cipher agreed to deliver 168 megawatts of IT and data computing capacity at its Barber Lake site. Fluidstack runs an AI cloud platform and builds HPC clusters for large companies.
The contract guarantees $3 billion in revenue over the initial term. It includes two five-year options that could lift total contracted revenue to over $7 billion.
Barber Lake has a maximum gross capacity of 244 MW. Cipher says the site can expand by 500 MW and has 587 acres of surrounding land.
Google’s role and financing terms
Google plans to backstop $1.4 billion of Fluidstack lease obligations to support project-related debt financing. In return, Google will receive warrants for 24 million shares of CIFR common stock, about a 5.4% pro forma equity stake.
Investor’s Business Daily noted Google agreed to a similar backstop for TeraWulf’s colocation deals with Fluidstack in August. Cipher plans to retain 100% ownership of the project and may access capital markets as needed to fund part of it.
Strategy, pipeline, and market reaction
CEO Tyler Page said the company will develop HPC data centers with Fluidstack and welcome Google as an investor. He called the deal a transformative step that supports its HPC momentum.
Page said he believes this is the first of several deals in the HPC space. He said the company will scale its capabilities and strengthen its position in a growing sector.
Cipher reports a pipeline of about 2.4 gigawatts prioritized for HPC, which excludes the contracted capacity for Fluidstack. The company also highlighted that Barber Lake is well-suited for next-generation compute.
CIFR stock fell 8.4% Thursday after rising almost 9% in premarket trading. Shares have climbed more than 85% in September and trade at four-year highs after an early August update on Phase II at its Black Pearl site in Texas. The site will host AI computing power and hydropowered bitcoin mining.
Arete started coverage of Cipher and two other bitcoin miners with buy ratings on Wednesday. Cipher is up about 205% this year through Wednesday and is moving toward its record high of 15.36, per Investor’s Business Daily.
