Riot Platforms (RIOT) Q3 2026 Earnings Call Transcript

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DATE

Nov. 4, 2026

CALL PARTICIPANTS

• Head of Investor Relations - Josh Kane
• Chief Executive Officer - Jason Les
• Chief Financial Officer - Jason Chung

TAKEAWAYS

• Corsicana Lease Capacity -- 910 MW of critical IT capacity, representing the entirety of the campus and approximately 20% more leasable capacity than the site's original design.
• Total Contracted Revenue -- $38 billion across 1,151 MW of critical IT capacity with leading players in the artificial intelligence ecosystem.
• Corsicana Total Revenue -- $28 billion over a 15-year initial term, which is expected to rise to $54 billion if two five-year extension options are exercised.
• Average Annual NOI -- $2.2 billion expected at full deployment across the lease portfolio, representing an unlevered yield on cost of 28%.
• Corsicana Unlevered Yield -- 33% based on total project capital of $6 million per MW, which is roughly half the capital intensity of a Tier 3 data center build.
• Total Liquidity -- $950 million as of the end of the third quarter, consisting of $748 million in cash and $202 million in Bitcoin.
• Bitcoin Sales -- 20,264 Bitcoin sold year to date for approximately $1.5 billion, primarily to fund the expansion of the data center business.
• Quarterly Revenue -- $181 million, representing a 1% increase year over year as growth in Data Center and Engineering segments offset lower Bitcoin mining revenue.
• Net Income -- $4 million, or $0.01 per diluted share, reflecting a $172 million gain on the change in fair value of Bitcoin.
• Adjusted EBITDA -- $191 million for the third quarter.
• Direct Cost to Mine -- $39,265 per Bitcoin, excluding depreciation and reflecting the impact of power curtailment credits.
• Bitcoin Production -- 1,637 Bitcoin produced in the third quarter, representing a 16% increase year over year.
• Engineering Segment Revenue -- $47 million, representing more than double the revenue reported in the same period last year.
• Engineering Backlog -- $142 million, with more than 90% of the work consisting of data center projects.
• Corsicana NOI Margin -- 99% expected under the triple-net structure where the tenant bears substantially all operating and utility costs.
• Project Financing Sources -- $6.1 billion to $7 billion in non-recourse project debt anticipated to fund development through mid-2028.
• AMD Capacity Timeline -- 50 MW total capacity expected to be ready for service by May 2027, with the next 10 MW delivering in Nov. 2026.
• Rockdale Frontier AI Delivery -- 96 MW expected in Dec. 2027 and 95 MW in June 2028 for a leading frontier AI lab.
• Corsicana Phase 1 Delivery -- 400 MW expected in Sept. 2027, followed by 200 MW in Jan. 2028 and 310 MW in July 2028.
• Net Cost of Power -- $0.032 per kilowatt hour, following the application of $25 million in power curtailment credits.
• Bitcoin Hash Rate -- 44.9 exahash per second deployed at quarter end, representing approximately 4.9% of the global network.
• Coinbase Credit Facility -- Fully repaid $200 million facility during the year, which released all 5,821 collateralized Bitcoin.

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RISKS

• Chung noted that the company is operating in a "tighter credit market, characterized by a higher interest rate environment, credit-led spread widening since September, and lenders doing deeper diligence on tenant credit, power, and delivery track record."
• Les stated, "Some risks do stay with us, and that includes scope that's not under GMP, expense for site conditions and OFCI equipment," regarding the development costs at Rockdale.

SUMMARY

Riot Platforms, Inc. (RIOT +14.02%) management reported a transition in the company's business profile toward serving as a digital infrastructure provider for the artificial intelligence ecosystem. The company announced its largest lease to date at the Corsicana campus, utilizing a triple-net powered land lease structure designed to reduce capital intensity and shift operational risks to the tenant. Management stated that current liquidity and non-recourse project debt will fund announced capacity expansion without the need for additional equity issuance. The strategy focus is on scaling data center revenue from digital infrastructure assets while maintaining a disciplined capital allocation policy.

• Les stated, "At full deployment of currently executed deals, nearly all of our expected cash flow will be generated from long-term leases with leading players in the AI ecosystem."
• Les noted that the Corsicana triple-net structure "roughly halves our capital intensity versus a Tier 3 build, leaves the operating and technology risk with the tenant, and has been designed with financing in mind."
• Management reported that the 910 MW Corsicana lease is among the largest single data center leases ever announced in the sector.
• The company has sold the majority of its Bitcoin treasury, reducing holdings to 2,418 Bitcoin to fund the data center business expansion.
• In-house engineering and manufacturing capabilities through ESS Metron and E4A Solutions are intended to mitigate schedule risks for the Rockdale and Corsicana developments.
• Chung stated, "Riot has multiple layers of non-dilutive funding standing ahead of any equity issue, and we do not currently anticipate issuing equity to fund any announced project."
• Management noted that 2029 is expected to be the first full year with every phase of current leases in service.

INDUSTRY GLOSSARY

• Triple-net: A lease agreement where the tenant is responsible for all expenses of the property including taxes, insurance, and maintenance.
• NOI (Net Operating Income): A calculation used to analyze the profitability of income-generating real estate investments.
• IT MW: Information Technology Megawatts, a measure of the power capacity available for IT equipment in a data center.
• GMP (Guaranteed Maximum Price): A contract type where the contractor is compensated for actual costs plus a fixed fee subject to a ceiling price.
• OFCI (Owner Furnished Contractor Installed): Equipment that is purchased by the owner but installed by the contractor.
• Exahash per second (EH/s): A unit of measurement representing one quintillion hashes per second, used to measure the processing power of the Bitcoin network.

Full Conference Call Transcript

Operator: Hello, and welcome to Riot Platforms Inc. Third Quarter 2026 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question at this time, just press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. As a reminder, this call is being recorded. I would now like to turn the call over to Josh Kane, head of Investor Relations. You may begin.

Josh Kane: Thank you, operator. Good morning, and welcome to Riot Platforms Third Quarter 2026 Earnings Conference Call. My name is Josh Kane, head of Investor Relations. Joining me on today's call from Riot are Jason Les, chief executive officer, and Jason Chung, chief financial officer. On the Riot Investor Relations website, you can find our third quarter 2026 earnings press release and accompanying earnings presentation, which are intended to supplement today's prepared remarks, and which include a discussion of certain non-GAAP items.

Non-GAAP financial measures provided should not be considered as a substitute for or superior to the measures of financial performance prepared in accordance with GAAP and are included as additional clarifying items to aid investors in further understanding the company's third quarter 2026 performance. Lease revenue and net operating income figures for our Corsicana lease are management estimates presented before the amortization of tenant reimbursements, which under lease accounting will reduce reported lease revenue over the term. The basis of presentation is described in the footnotes to the presentation. During today's call, we will be making forward-looking statements regarding potential future events. These statements are based on management's current expectations and assumptions and are subject to risks and uncertainties.

Actual results could materially differ due to factors discussed in today's earnings press release, in comments and responses made during today's call, and in the risk factor section of our Form 10-K and Forms 10-Q, including for the three months ended September 30, 2026, which will be filed later today, as well as other filings with the Securities and Exchange Commission. With that, I'll turn the call over to Jason Les, CEO of Riot Platforms.

Jason Les: Thank you, Josh, and good morning, everyone. Today, we are very pleased to announce that Riot has signed the largest lease in our history, a 15-year triple-net powered land lease with a leading frontier AI lab for the entirety of our Corsicana campus, representing 910 MW of critical IT capacity. This announcement is the clearest demonstration yet of what Riot has become, a leading digital infrastructure developer serving leaders at the forefront of the AI ecosystem. With this lease, Riot has now contracted 1,151 MW across three leases with AMD and a leading frontier AI lab, all signed this year, representing approximately $3.8 billion of contracted data center revenue, or $7.2 billion if all extension options are exercised.

Upon full deployment, we expect these leases to generate $2.2 billion of average annual net operating income at an unlevered yield on cost across our lease portfolio of approximately 28%. Four accomplishments define where we stand today. First, at Corsicana, our lease with the Frontier AI Lab is expected to generate approximately $28 billion in total contract revenue over the 15-year initial term, and approximately $54 billion if both five-year extension options are exercised. I will spend most of my time today discussing this transaction because it does more than add scale. It fundamentally changes Riot's business profile.

A year ago, our cash flow depended on the price of Bitcoin, and now, at full deployment of currently executed deals, nearly all of our expected cash flow will be generated from long-term leases with leading players in the AI ecosystem. Further, the structure roughly halves our capital intensity versus a Tier 3 build, leaves the operating and technology risk with the tenant, and has been designed with financing in mind. Second, at Rockdale, our 191 MW Frontier AI Lab deployment is on schedule, with construction and long-lead procurement underway for delivery of the first phase in December 2027.

We are finalizing credit support for the project debt financing with a high investment-grade counterparty, and the Morgan Stanley interim facility is funding development costs in the meantime. Third, we continue to execute for AMD. The 25 MW expansion is on time and on budget, with the next 10 MW delivering this month and the full expansion expected online in May 2027, bringing total capacity online for AMD to 50 MW. The bank project finance process on the AMD lease continues to progress and is expected to close shortly. And fourth, our financial position remains strong.

We have sold down the majority of our Bitcoin treasury to fund our data center business, reducing our holdings to just over 2,400 Bitcoin at quarter end. We also fully repaid our $200 million Coinbase credit facility, releasing all collateralized Bitcoin, and ended the quarter with $950 million of total liquidity. Consisting of $748 million of cash, including restricted cash, and $202 million of Bitcoin. We have not raised equity capital in 2026, and Jason Chung will walk through later in this call. We do not currently anticipate issuing equity to fund any of our announced projects.

Taken together, these achievements give Riot a data center portfolio backed by long-term, high-margin contracts, multiple non-dilutive ways to fund development, and the flexibility to direct future cash flows to whichever use creates the most value per share. Let's now turn to the Corsicana announcement. From the outset of our evolution into a leading digital infrastructure developer, we have been focused on maximizing the value of our large-scale power portfolio on a risk-adjusted basis. Our lease with a leading Frontier AI Lab delivers on this goal. This deal structure is different from our Rockdale leases, and deliberately so, as a reflection of the unique value an asset like Corsicana commanded in the market.

Through our process, we engaged with multiple counterparties and structures, and what we are announcing today is what we believe to be a tremendous outcome on maximizing the value of our crown jewel asset, especially on a risk-adjusted basis. Rather than Riot designing and developing a Tier 3 data center, the contract signed with the Frontier AI Lab at Corsicana is a triple-net powered land lease. Riot delivers the land, the power infrastructure, and the powered pads, while the Frontier AI Lab procures, installs, owns, and operates a modular compute deployment on those pads, using the design the tenant developed, and bears all operating costs, including power. This division of responsibility changes the capital equation.

We expect total project capital of approximately $6 million per IT MW, roughly half the capital intensity of our Tier 3 build at Rockdale. This consists of $2 million per MW of site work and electrical infrastructure that Riot will complete, and $4 million per MW that Riot will reimburse to the tenant for its cost. Importantly, these reimbursements are paid phase by phase, and only after each phase has been delivered and begun paying rent. The structure of this deal also changes the power equation. Under our original Tier 3 basis of design, we expected Corsicana to support up to 756 IT MW.

Under this lease, the same 1 GW of utility load supports 910 IT MW, representing 20% more leasable capacity from power we already own and control. Finally, the lease was built to be financed, with project debt sized to contracted rent, a rent credit mechanism if that debt is not available on comparable market terms, and Riot's cash contribution expected to be funded from existing liquidity. Jason Chung will walk through the funding plan in more detail shortly. Next, I want to talk about the economics of this announcement.

Over the 15-year initial term, the lease is expected to generate approximately $28 billion of total contract revenue, or approximately $1.8 billion of average annual rent, including escalators and before the lease accounting amortization of tenant reimbursements, as Josh noted. Because the tenant bears substantially all operating costs under the triple-net structure, we estimate an NOI margin of approximately 99%, or approximately $1.8 billion of average annual net operating income over the term. Against total capital of $6 million per IT MW, or approximately $5.5 billion, that is an unlevered yield on cost of approximately 33%. At that yield, the project returns its capital in roughly three years before any leverage on a 15-year lease.

Full deployment of the first phase is expected in September 2027, with the full campus delivered by July 2028. The Frontier AI Lab holds two five-year extension options beyond the initial term. For context, this is among the largest single data center leases ever announced in our sector, and it carries the lowest operating and capital risk profile of any lease in our portfolio. At the bottom of the slide, we can see how the deployment comes together in three phases: 400 MW in September 2027, roughly 10 months from now, 200 MW in January 2028, and the final 310 MW in July 2028. The full 910 MW will be delivered within two years of signing.

Slide nine sets out who does what under the lease, because that allocation is where the risk reduction comes from. Riot's obligations are in the left column. We build and deliver the powered pads with medium voltage power supply, and we own and maintain the high and medium voltage power infrastructure that feeds them. In operations, our role is limited to that of our owned power infrastructure, landscaping, and campus-level perimeter security. On the tenant side, the Frontier AI Lab procures, installs, and owns the compute modules. It pays 100% of actual utility costs, including demand, capacity, and tariff charges, as a pure pass-through with no markup.

The tenant also pays all operating expenses under a triple-net structure and is responsible for any alterations and lifecycle CapEx over the term outside of Riot-owned power infrastructure. Rent is paid on the full 910 critical IT MW regardless of utilization, and rent on each phase commences no later than 60 days after each power pad is delivered. For Riot, the risks we will not carry include development risk on the data hall, operating risk on mechanical and cooling systems, SLA exposure across hundreds of megawatts of compute, the cost of redesign as chip generations change, power price risk, and utilization risk.

What remains as our responsibility is the part of the value chain where we have the most control: land, power, and the infrastructure that delivers it. This is a fundamentally different structure than most comparable data center leases and one that drives significantly more value to Riot shareholders because of the greatly reduced risk associated with construction, procurement, delivery, and ongoing operations of data center projects. We have put in place a division of responsibilities that accelerates time to rent being received from the tenant and protects that rent stream over the term. With that, let me turn it over to Jason Chung to walk through the Corsicana financing plan.

Jason Chung: Thank you, Jason. The message on slide 10 is straightforward. The Corsicana lease structure lowers our capital requirement and gives us multiple paths to fund what remains, none of which depends on issuing equity. Starting with the capital required, total project costs are approximately $5.5 billion across 910 IT MW, $3.6 billion of reimbursements to the tenant at $4 million per IT MW, and $1.8 billion of site work and infrastructure at $2 million per IT MW. As Jason noted, reimbursements are paid only after each phase is delivered and the tenant begins paying rent, so we do not fund reimbursements ahead of contracted cash flow. Now, onto the sources of that capital.

Our plan is to fund Corsicana with non-recourse project debt sized to contracted rent, shown as path A on the slide. An illustrative 80%-90% loan-to-cost financing ratio results in approximately $4.4 billion-$4.9 billion in non-recourse project debt, drawn as site work is completed and as each phase is delivered and begins paying rent. Riot earns the full contracted rent less debt service, and our cash equity covers the balance, approximately $500 million-$1.1 billion against approximately $1.2 billion of near-term liquidity, which I'll come back to on slide 18. We expect to launch this financing process in 2027, ahead of the first phase delivery. The lease also protects us if that debt is not available on comparable market terms.

In that case, the tenant will initially fund reimbursements and will recover them as credits against rent amortized over the remaining lease term. Under this path B scenario, there will be no need for external financing to fund reimbursements to the tenant, while Riot will retain flexibility to fund the $1.8 billion of site work costs with cash, debt, or some combination of the two based on the rent credit adjusted cash flows. The rent credits will carry an implied interest rate of 12%, and path A remains our base case. This structure gives Riot three non-dilutive layers of funding for Corsicana: non-recourse project debt, the lease itself, and our own liquidity.

This project does not depend on any single source of capital, and under either path, Riot will continue to own the land, the power, and the site infrastructure, receiving 15 years of take-or-pay rent on 910 IT megawatts while the tenant will fund and own the compute. With that, I'll hand it back to Jason Les for an update on Rockdale and AMD.

Jason Les: Thank you, Jason. Turning to Rockdale, I'd like to walk through updates on both our Frontier AI Lab and AMD development. On the left-hand side, we can see the timeline for our 191 MW lease with a leading Frontier AI Lab, which we announced last quarter and which is expected to generate approximately $9.1 billion of contract revenue over its initial 20-year term. This is Riot's first full Tier 3 data center project and is on time and on budget for its ready-for-service dates. Two things made this possible. First, we locked the design with the tenant early, which let us conduct advanced discussions and begin procurement with key suppliers for long-lead equipment.

Second, we are using our own engineering capabilities at ESS Metron and E4A Solutions, alongside many of our tenant's preferred vendors, which takes most of the schedule risk off the table. This project is well underway with the first 96 MW on track for ready for service in December 2027 and the remaining 95 MW in June 2028. On financing, we are finalizing credit support for the project debt from a high investment grade counterparty, with preparation for the project financing progressing in parallel, and the launch to follow once it is signed. The Morgan Stanley interim facility is funding procurement and construction in the meantime, so the schedule does not depend on the timing of that close.

Moving on to AMD, we can see the first 25 MW were commissioned and fully stabilized in May 2026, and the full 50 MW remain on track to be ready for service in May 2027. AMD is the proof point for how Riot delivers. In-house engineering, manufacturing, and a design built around the tenant's requirements enabled us to go from lease signing to a stabilized 25 MW in four months. AMD continues to hold expansion options for up to an additional 150 MW at Rockdale. Slide 12 brings the three leases together. In 2026, Riot has secured approximately $38 billion of contracted data center revenue across 1,151 MW of critical IT capacity with leading players in the AI ecosystem.

The table shows each lease, from which I'd like to highlight three main points. First, the total. Approximately $2.3 billion of average annual revenue and $2.2 billion of average annual NOI at full deployment, on total capital of $7.7 billion-$7.9 billion, representing an unlevered yield on cost of roughly 28%. Second, the margins. NOI margins run from 80% at AMD to 80%-90% with the Frontier AI Lab tenant at Rockdale, to approximately 99% at Corsicana, where the tenant bears substantially all operating costs under the triple-net structure. Third, the timing. AMD reaches full deployment in May 2027, the Frontier AI Lab tenant at Rockdale in June 2028, and at Corsicana in July 2028.

All 1,151 MW are in service within 20 months. With AMD's expansion options for a further 150 MW, contract potential reaches approximately 1.3 GW. Contracted revenue, a defined capital budget, and a clear funding plan are the fundamentals on which we anticipate Riot will be valued going forward. Slide 13 shows how lease revenue ramps as each phase comes into service. Today, 25 of our 1,151 leased megawatts are in service. By the end of 2027, that grows to 546 MW as AMD's second 25 MW, the first 96 MW for the Frontier AI Lab at Rockdale, and the first 400 MW phase at Corsicana all come online.

By mid-2028, with Corsicana's second and third phases and Rockdale's second phase delivered, all 1,151 MW are in service. In revenue terms, lease revenue grows from approximately $23 million this year to approximately $250 million in 2027, $1.8 billion in 2028, and $2.3 billion in 2029, the first full year with every phase in service. This ramp is important for two reasons. First, it is the revenue base on which Riot will be valued going forward. Second, this represents an important source of funding in its own right, as rent from phases delivered first will help fund subsequent phases, which we will discuss further on slide 18. Slide 14 shows how we think about capital allocation.

With 1,151 MW contracted and more than $2 billion of annual NOI from contracted assets upon full deployment, the question has moved from whether Riot can sign leases to how we will deploy the cash flow these leases produce. We apply one test to every dollar we allocate: Does it maximize value per share? There are three uses of capital, and we evaluate each against that test. First, growing the power portfolio. Building or buying energized megawatts for future data center development, but only when the risk-adjusted return is well above our cost of capital and compares favorably to the portfolio we already own. Second, maintaining financial flexibility.

Project debt that is non-recourse to Riot and capital recycled from one project to the next, as we are doing with our AMD financing. And third, returning capital to shareholders when our own shares offer a better return than the next project, or when our growth is fully funded. As contracted cash flows come online, return of capital becomes a real and reoccurring part of this evaluation. Four criteria fit under all three: returns well above our cost of capital, leverage size to contracted rent, liquidity sufficient to fund every announced commitment, and equity only where an investment is meaningfully accretive on a per-share basis.

That is why we have raised no equity in 2026 and why we do not anticipate needing to for the projects we have announced. Our philosophy is simple. The best risk-adjusted portfolio produces the most reliable cash flows, and the most reliable cash flows give us the widest range of choices about how to compound value per share. Before I hand the call over to Jason Chung, I want to spend a minute discussing our pipeline for future growth.

With Corsicana fully leased and Rockdale substantially committed, additional growth will come from new development capacity, which we are pursuing across five verticals: expanding capacity at our existing sites through additional acreage and utility relationships, acquiring and developing grid-powered land with near-term approved capacity, self-generation behind the meter where grid constraints require it, corporate acquisitions that deepen our engineering, products, and services platform, and strategic partnerships and joint ventures. We will pursue that pipeline with the same discipline that produced the portfolio you see today. We are deeply engaged across each of these avenues today, with teams dedicated to forging future growth for Riot.

Every opportunity will be measured against the risk-adjusted returns we have already locked in and against every other use of our capital. With that, I'll turn it over to Jason Chung for the financing update and our quarterly results.

Jason Chung: Thank you, Jason. I want to start by revisiting the four financing principles we laid out earlier this year and show how we're executing against each of them in a tighter credit market, characterized by a higher interest rate environment, credit-led spread widening since September, and lenders doing deeper diligence on tenant credit, power, and delivery track record. First, liquidity. Our response to a more volatile market and Bitcoin drawdown has been to convert Bitcoin to cash ahead of our committed equity needs, to hold no pledged collateral, and to manage liquidity against each project's equity requirement.

Year-to-date, we have sold 20,264 Bitcoin for $1.5 billion, repaid our $200 million Coinbase facility in full, and released all 5,821 pledged Bitcoin, ending the quarter with $950 million of liquidity. Second, access. We lead with the three things lenders are diligencing most: tenant credit, power that is already interconnected and energized, and a delivery record supported by our in-house engineering, manufacturing, and procurement. We are building relationships across multiple funding sources to maintain diversification. That includes approximately $750 million of facilities closed or expected to close shortly, the $573 million Morgan Stanley interim facility, and the $180 million AMD term loan plus delayed draw facility, with the Rockdale and Corsicana project financings in process behind them. Third, cost.

Spreads today are driven by tenant credit and structure, so we match the credit basis to each project. At Rockdale, AMD is an investment-grade tenant, with the term loan expected to price at around SOFR plus 250 basis points. Also at Rockdale, our lease with a leading frontier AI lab is expected to be supported with high investment-grade credit support, and we are positioning that debt towards bond execution. At Corsicana, the lease is engineered for financeability, significantly reduced capital requirements relative to Tier 3 builds, triple-net lease structure, take-or-pay on delivered capacity, and reimbursements funded phase by phase after rent commencement. Fourth, discipline.

Our project financings will be structured as non-recourse to Riot and sized to contracted rents, and spend is released as each financing closes. On cost, we have and will continue to negotiate fixed price and guaranteed maximum price contracts, and with added visibility and control through our in-house manufacturing and procurement. The result of these four principles is a line at the bottom of the slide. No equity raised in 2026 and none currently anticipated to fund any of our announced projects. The next slide will show the sources of capital that stand ahead of Riot equity.

That brings me to slide 18, which answers a question we hear often from investors: How does Riot fund all of this without issuing equity? Let's start with the capital uses. Across Corsicana and Rockdale, we expect total project capital of approximately $7.6 billion-$7.8 billion, $5.5 billion at Corsicana and $2.1 billion-$2.3 billion at Rockdale, with additional AMD CapEx expected to be financed through the AMD bank facility we are now finalizing. We expect approximately $6.1 billion-$7 billion of this to be funded with project-level debt, non-recourse to Riot, and sized to contracted take-or-pay rent at an illustrative 80%-90% of project capital.

That leaves an illustrative Riot cash equity requirement of approximately $800 million-$1.5 billion, deployed alongside development from now through mid-2028 as each financing closes. Now, onto the sources of capital. We have approximately $1.2 billion of near-term liquidity, $950 million of cash and Bitcoin, and $110 million of other anticipated near-term inflows, plus $180 million of proceeds from the AMD term loan, which we expect will be available on closing. In addition, contracted rent from Corsicana phases one and two, and from our Rockdale tenants, adds approximately $900 million before debt service by the time Corsicana's final phase is delivered.

That brings cumulative sources to approximately $2.1 billion, more than Riot's cash requirement at any leverage level in the illustrative range, $1.5 billion at 80% loan-to-cost, $1.2 billion at 85%, and $800 million at 90%. The timing works in our favor. Reimbursements are paid only after each phase is delivered and paying rent, so the sources arrive ahead of the uses. This is also before additional non-dilutive sources of funding that we have not counted in that chart. First, contracted rent from Corsicana phase III. Second, the land, substations, and power infrastructure we already own at Corsicana, which can potentially be contributed as sponsor equity and count towards lenders' equity requirements, reducing our cash needs further.

Third, refinancing of stabilized leaseback assets, which releases Riot equity from completed projects for the next phase, exactly as we are doing with AMD. Fourth, a future parent-level facility, such as a corporate revolver, to fund early-stage development costs and working capital, drawn only if needed. Put simply, Riot has multiple layers of non-dilutive funding standing ahead of any equity issue, and we do not currently anticipate issuing equity to fund any announced project. Let's move to our third quarter financial results on slide 20.

For the third quarter of 2026, Riot reported total revenue of $181 million, up 1% year-over-year, as data center and engineering revenue grew by $46 million, which offset lower Bitcoin mining revenue on an average Bitcoin price 38% below last year's third quarter. We recorded GAAP net income of $4 million, or $0.01 per diluted share, and Adjusted EBITDA of $191 million. Net income reflects $124 million of depreciation and amortization, $21 million of stock-based compensation, and an $18 million non-cash impairment, offset by a $172 million gain on the change in fair value of Bitcoin, which is included in Adjusted EBITDA.

In our data center segment, we exited the quarter with 25 MW of critical IT capacity contracted and delivered, and generated $18 million of total segment revenue, including $8 million of operating lease revenue at an 80% operating lease gross margin, in line with the economics we underwrote, and $10 million of tenant fit-out, which fluctuates with the development cycle. On an annualized basis, the base rent from those first 25 MW is roughly $31 million, consistent with the AMD economics on slide 12, and it steps up as the next 10 MW deliver this month.

In our Bitcoin mining segment, Riot produced 1,637 Bitcoin in the third quarter, or 17.8 Bitcoin per day, and ended the quarter with a deployed hash rate of 44.9 exahash per second, representing about 4.9% of the global network. Average operating hash rate for the quarter was 36.2 exahash, reflecting summer curtailment under our power strategy, including the 4CP program. This curtailment generated $25 million of power credits, equivalent to $15,067 per Bitcoin mined, bringing our net cost of power to $0.032 per kilowatt hour, among the lowest in the industry. As a result, our direct cost to mine, excluding depreciation, was $39,265 per Bitcoin.

We ended the quarter holding 2,418 Bitcoin, valued at $202 million at the September 30th closing price of $83,554, down from 11,380 Bitcoin at the end of the second quarter. That reduction is by design. Our Bitcoin treasury has been the primary funding source for data center development, and we expect to continue to sell substantially all of the Bitcoin we mine. Our engineering segment delivered $47 million of revenue, more than double a year ago, at a 15% gross margin that reflects a large, low-margin cable procurement order at E4A. We expect a better mix in the fourth quarter that should flow through to higher margins.

Backlog is $142 million, more than 90% of which is data center work, with capacity deliberately reserved for Riot's own projects, where ESS Metron supplies a switchgear for Rockdale, and is expected to for Corsicana. Segment detail for all of our businesses is in the appendix. With that, I will hand the call back over to Jason Les.

Jason Les: Thank you, Jason. Slide 22 puts our year into perspective. 2026 has been a year of execution. In January, we acquired the land at our Rockdale site and signed our first data center lease with AMD. In May, we delivered AMD's initial 25 MW on time and on budget. In the third quarter, we signed a 191 MW lease with a leading frontier AI lab at Rockdale, and more recently, we signed the 910 MW lease at Corsicana with the same frontier AI lab. From here, the timeline is about delivery. AMD completes in May 2027, Corsicana's first phase and Rockdale's first phase follow by the end of 2027, and every remaining phase is delivered by July 2028.

Twelve months ago, Riot had no data center lease revenue. By 2029, lease revenue is contracted at approximately $2.3 billion per year, with every megawatt behind it already signed. What remains between here and there is execution, which is what this team has done all year. At the beginning of this year, when we laid out what we saw as the potential for our power portfolio, we communicated a total portfolio net operating income range of $1.6 billion-$2.1 billion. With leases signed this year, we are now expecting to exceed the top of that range, with average annual NOI of approximately $2.2 billion on contracts already in place.

We have further headroom to grow with the remaining unleased power capacity at our Rockdale and Kentucky sites. Further, the large majority of that NOI is significantly de-risked from a delivery and operational standpoint compared to standard data center leases in the market. With our existing portfolio substantially leased, growth from here comes from the pipeline I described earlier, pursued with the same discipline and measured against every other use of our capital.

Our priorities from here are clear: deliver AMD, Rockdale, and Corsicana on schedule and on budget, finalize the Rockdale and Corsicana financings, and expand access to additional sources of liquidity, and deploy capital where it is the most accretive, whether that is developing our power pipeline or returning capital to shareholders. Riot is a data center infrastructure platform. We own the scarcest inputs in this industry: land, fully approved power, and the infrastructure to deliver it. We have leased that capacity to leaders in the AI ecosystem on long-term contracts, with different solutions for different customer needs.

The result is a portfolio optimized for superior risk-adjusted returns, with multiple non-dilutive ways to finance development, and a company with the cash flow and discipline to put every dollar to its highest and best use. On behalf of our entire management team, I want to thank our shareholders, our tenant partners, the communities we serve, and our employees for their continued support. With that, we will now open the call up for questions. Operator.

Operator: We will now begin the question-and-answer session. If you would like to ask a question, just press star followed by the number one on your telephone keypad. If you would like to withdraw your question, just press star one again. Thank you. Your first question comes from the line of Mike Grondahl with Northland Securities. Mike, please go ahead.

Mike Grondahl: Hey, guys. Congratulations on Corsicana. Looks like a really nice lease. I wanted to ask a question about Rockdale. Given the recent cost overruns that we've seen in the industry, what gives you the confidence that $11 million-$12 million of megawatts for the CapEx development costs at Rockdale is going to be sufficient? As a follow-up, how much of that project cost is currently fixed or contracted? What sort of remains subject to change, and who bears the risk at Rockdale if costs exceed your estimates?

Jason Les: Thanks for that question. I'll talk about Rockdale, and then on the theme of your question, I'll talk about Corsicana as well, and then address who bears the risk here. On Rockdale, our confidence comes from the work that we did before signing. Over the past several months, one of our key messages to the market has been that signing a lease isn't just about having power. It's about the product that you're building for the tenant, and that's why we've put in substantial design and pricing work before committing to a number. Because of that, our design is sufficiently advanced at this stage, and we're locking in prices and phases with our general contractor.

As each scope matures, the GC competitively bids that trade package, and the full scope goes under a guaranteed maximum price, building towards a final GMP for the full project. Today, we're finalizing that GMP with our GC, and we're expecting roughly 70% of the total budget to be under GMP. That's also the key point on when costs get locked in. It isn't when you hire a GC, it's when a scope goes under GMP, and that's where our focus is right now. The balance of the budget for Rockdale is for OFCI, which we have already begun procuring, and we expect to complete ordering of that equipment this month.

Therefore, we feel confident maintaining our estimate within the $11 million-$12 million per megawatt range for the Rockdale build. I know you didn't ask about Corsicana, but on the same thing, I'll talk about Corsicana, which is a different structure, and there, our exposure is significantly smaller. Roughly 70% of our capital there is a capped contribution in the form of the tenant reimbursement for modules they are procuring themselves. So, that's a number that doesn't go up.

The rest of the balance of spend at Corsicana is a smaller scope, and of that smaller scope, one, our procurement process has already been underway for the OFCI part of that development, and we expect to complete that ordering of the longest lead items by the end of the year. Outside of OCI, we'll utilize GMP contracts just as we are at Rockdale. Finally, on who bears the risk. In our leases, the lines are drawn clearly. First, if the tenant changes what it wants, the tenant pays. Every lease has a change order process where changes are priced upfront and it either reimbursed or built into rent with schedule relief.

Second, once a scope is under the GMP that I was speaking about, costs above that price are the contractor's responsibility. If it comes in under, we share those savings together. Third, some risks do stay with us, and that includes scope that's not under GMP, expense for site conditions and OFCI equipment, that I mentioned that we buy directly. We don't pass those through to tenants. Instead, we manage them by buying our critical equipment early, handling tariff and material escalations through contracts with escalation tables, and carve-outs, contingencies we hold, and carrying reserves for labor if the market gets tight.

A GMP doesn't remove every risk, and I won't tell you there's none, but the upfront design, the phased document pricing, and the clear lease terms are who pays for what, are why we're confident in the $11 million-$12 million per megawatt figures for Rockdale that we've given.

Mike Grondahl: Hey, that's great. Thank you and congrats again.

Operator: Your next question comes from the line of Stephen Byrd with Morgan Stanley. Stephen, please go ahead.

Stephen Byrd: Hey, guys. Good morning, and congratulations on the Corsicana transaction.

Jason Les: Thank you, Stephen.

Stephen Byrd: Wanted to just get a little more detail on the deal. Definitely really interested in the details, and you laid out a lot of great details, quite compelling. I wondered if you could just maybe first talk through your thought process on how you decided to move forward with a single tenant for the full site and how that process evolved and sort of was ultimately signed.

Jason Les: Yeah, thanks for the question. For us, it was very clear early on that this was going to be a single-tenant takedown for the entire site. It was clear that was not only the best outcome for Riot, but also that was going to be the most likely. There are two reasons behind that. First, while it is possible to subdivide the site, it would introduce operating complexity, and it would also reduce leasable space, and that would therefore dampen the overall value creation. Number two, really all potential tenants that we spoke to expressed interest in the entire site.

It is such a valuable asset, it makes sense if someone is comfortable with some part of the site in this constrained environment, they are going to want it all. With this conclusion made, we then worked through a variety of structures and potential tenants before we selected the path that we believe offered the best risk-adjusted returns for shareholders. If you think back to our Q2 earnings call back in August, on that call, we reported that we had an LOI for the entirety of the Corsicana site. That was 756 critical IT megawatts.

As our discussions with our tenant advanced, things evolved, and we ultimately landed on a structure that got Riot the attractive economics a site like Corsicana demands, while delivering to our tenant here what they needed to achieve their accelerated time-to-compute objectives. While not a traditional build-to-suit structure, a superb outcome for Riot. The other thing I will say about the structure and how we got here is that it allowed us to deliver more capacity than our original 756 MW that we expected with that first LOI. Now, we are at 910 total critical IT megawatts in the take-or-pay agreement.

The reason for that is, our tenant wanted to maximize the total potential capacity of the site, even if that meant certain times of the year at different levels of utilization than other times. Regardless of utilization, once fully delivered, Riot receives rent on that full 910 MW. The result is, the tenant gets more usable capacity, and we get a greater base of capacity upon which we receive rent. Altogether, this is a win-win outcome in that we are able to achieve substantial average annual NOI on significantly less capital than a traditional build, and at the same time, our tenant was able to deploy the faster modular solution that they desired.

Stephen Byrd: That is very clear. I was surprised by a number of parts of this deal, but that 910 MW, I was surprised by that as well. Maybe just one follow-up. I wonder if you could talk a little bit more about the actual structure and economics of the deal. I think many investors, and I was thinking of a more traditional Tier 3 build of Corsicana. Could you just talk a little bit more about what drove your decision to go forward with this structure and how we should think about this deal relative to other deals that we have seen in the market?

I think you have laid out a bit about what your view is in terms of why this deal is attractive. I just want to make sure I understand from your perspective what makes this deal the most attractive from your perspective.

Jason Les: Yeah, absolutely. From the outset of our transformation here, we have said that our goal was to maximize shareholder value on a risk-adjusted basis, and we are incredibly proud of how we accomplished that with this deal. We believe this is a hallmark structure with its combination of best-in-class yield on cost and best-in-class risk profile. The result of this deal is a triple-net rental rate on the high end of the range for a Tier 3 data center build, while we only need to spend half the CapEx of a typical Tier 3 build.

The scope of our CapEx here significantly limits our procurement and construction risks, and when you pair that with our ongoing operation responsibilities, the result you get is substantially reduced risk in execution. So, it is truly the best of both worlds here. Further, we believe that this deal is a direct answer to the risks that investors are focused on in our space. Not only is procurement and development in this deal substantially limited when compared to a traditional Tier 3 build, but that reduced level of CapEx reduces the level of financing required for both equity and debt.

When you pair that with the mechanism in the lease that we spoke about in our prepared remarks, where the reimbursements to the tenant, which is 70% of our capital spend on this deal, can be paid through rent credits if reasonable financing terms aren't available, we have substantially limited our financing risks. These two domains of risk, delivery and financing, these are two areas of investor focus that we have addressed with this structure while still delivering an incredibly attractive rental rate and underlying economics. The point is, we did not have to compromise.

Finally, this structure gets us to revenue and starts cash flowing significantly faster than a typical Tier 3 build, with the first phase of delivery in September 2027. For a typical Tier 3 deal announced today, that would be an impossible delivery date. We believe that this is a new milestone in the industry in terms of value creation and on a risk-adjusted basis. We are incredibly proud of this outcome.

Stephen Byrd: Really helpful, and congrats again.

Jason Les: Thank you.

Operator: Your next question comes from the line of Paul Golding with Macquarie Group. Paul, please go ahead.

Paul Golding: Thanks so much for taking the question, and congrats on the deal and all the progress. I wanted to first ask, before getting to Corsicana, about Rockdale. Jason, maybe if you could remind us a bit around the AMD options and the structure there of what's pending or what's under exclusivity in terms of incremental capacity and maybe overall incremental capacity left to be leased at Rockdale, and maybe whether you would look to do a similar structure as what was done at Corsicana relative to what may be available at Rockdale for future leasing, just as we think about capital needs going forward. Thanks so much.

Jason Les: Thanks, Paul. At Rockdale, AMD holds an option for an additional 150 MW. We remain very close with them on their capacity needs. Obviously, I can't share anything more than that right now. But if you take those options and then you combine that with the rest of the site capacity, what that leaves you with is about 200 to 250 critical IT MW of remaining leasable capacity. Our Frontier AI Lab is interested in additional capacity as well, so I would expect Rockdale's remaining capacity to eventually be taken down by one or both of our existing tenants. If not, that's okay.

We have strong interest on the sidelines, so I'm confident in our path to a full lease of the site, and I think recent events make this capacity even more valuable here. I would expect the remainder of the build-out of Corsicana to be, I'm sorry, the remainder of the build-up for Rockdale to be along the lines of the developments you already see there, whether it's expansion of the type of product that AMD has or another deployment of a Tier 3 build, like what the Frontier AI Lab has. But we definitely see a path to leasing up the remaining capacity of that site as we continue to progress on our strategy.

Paul Golding: Thanks so much for that. Maybe if I could follow up on Corsicana, the timeline shows the 400 MW to be phase I. How should we think about the Bitcoin mining capacity that is up and running relative to that phase II delivery, and what decommissioning timeline might look like for that, given that I think that capacity lines up with what you have been running at the site? Thanks so much.

Jason Les: Yeah. So, we will not need to take down Bitcoin mining to achieve the first 400 MW tranche, but we will need to take it down as we prepare for the second phase. I do not have a schedule for you yet. As we advance here, we will share more details on what you can expect, but you can probably expect Bitcoin mining capacity at the site to begin ramping down sometime in the summer of 2027.

Paul Golding: Great. Thanks so much, and congrats again.

Operator: Your next question comes from the line of Richard Choe with JPMorgan. Richard, please go ahead.

Richard Choe: Hi. I wanted to ask about, given the uncertainty around the elections last night, is there any risk to either your Rockdale or Corsicana campus in terms of what you can provide and deliver, and how do you see your capacity going forward given the political results?

Jason Les: Yeah, thanks for that question. I know that's definitely top of mind of investors going into this morning. So, I think on this, it's important to be abundantly clear on Riot's position. Our sites with Rockdale and 700 MW and Corsicana with one gigawatt, these interconnections, this power is already fully approved. Even further, these sites have been in operations for years, pulling hundreds of megawatts each. So, we feel very confident in our position on both of those sites. There's not additional approval needed to execute on developments here, and I think the proof point of that is at Rockdale, where you've seen us launch two data center developments in just this year.

The benefit of operating for so many years at both of these sites already is, we already have a strong in-place relationship with our local communities. For Rockdale, for example, we've been present in that community for about seven years now. We are substantially involved. We engage on a regular basis, and we really value those relationships that we have. That is the biggest source of our employee base, is the community surrounding us. So, those relationships are important to us, and the fact that these sites are already in operation, they already have their interconnects approved, we feel very confident in our position on these sites.

Richard Choe: Great. I assume that gave you some advantage or some comfort to signing this deal with the leading AI lab that you were already operating and present. Is that fair to say?

Jason Les: Absolutely. The fact that these sites are in operation, and in this case, Corsicana, that is the strongest proof point possible of the power interconnect. The other thing that it helped in executing this deal was proving the time to power that we could accomplish there. There is already a substation on site. We already have the substation expansion underway on site, and that made this site very valuable and allowed this deal to get done on the terms that it did.

Richard Choe: Great. Thank you.

Operator: That concludes our question and answer session. I will now turn the call back over to Jason Les for closing remarks. Jason?

Jason Les: I want to thank you, everyone, for listening today. We are so proud of what we have accomplished with not only this deal, but all the progress that we have made year to date. We have built an incredibly robust portfolio. I want to again thank our employees, our shareholders, and the community that we operate in for all their support over the years. We are just incredibly excited about this next stage of execution for us. So, thank you all. We will see you on our Form 10-K call in a few months.

Operator: That concludes today's call. You may now disconnect.

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