HIVE Digital Technologies (NASDAQ: HIVE) shares climbed approximately 20% on Monday following the announcement that researchers from Columbia University successfully conducted remote AI training on the company's GPU cluster in Asunción, Paraguay. The news marks a significant milestone in HIVE's strategic pivot from bitcoin mining toward high-performance computing (HPC) and AI infrastructure.
Validation of Older Hardware
The Columbia team ran AI models on HIVE's Nvidia A40 GPUs, demonstrating that older chips can handle lower-end training workloads when paired with optimized software. This opens the door for HIVE to market a cost-effective computing layer that competes with major US cloud hubs. Researchers noted that after performance leveling, the A40 hardware delivered results comparable to Nvidia's H100 chips for models up to 1.4 billion parameters, though the A40 cannot match the H100's peak performance.
Stock Surge Amid Financing Overhang
Despite the rally, HIVE faces a significant overhang from its at-the-market (ATM) equity program. According to a June 16 filing, HIVE has sold 29.2 million shares for $85.3 million gross, leaving $214.7 million in unsold capacity. At Monday's closing price of $5.12, that remaining portion represents approximately 41.9 million shares, or 15.5% of the 270.4 million shares outstanding. The ATM program could fund data-center expansion but also risks diluting existing shareholders.
Revenue Shift and AI Contracts
HIVE's fiscal 2026 revenue totaled $297.8 million, with digital currency mining contributing $278.3 million and HPC hosting just $19.5 million. However, the company has secured a more concrete AI revenue stream: a three-year, $220 million GPU cloud deal through its subsidiary BUZZ HPC, involving 2,304 Nvidia Grace Blackwell GPUs at Bell's Merritt, British Columbia, site. CEO Aydin Kilic expects deployment in late 2026 or early 2027, generating approximately $70 million in annual recurring revenue.
Paraguay Data Center Plans
HIVE is building a 100 MW substation in Yguazú, Paraguay, set to go live in September 2026, with data-center construction beginning in the fall and service expected in the second half of 2027. The company aims to leverage low-cost renewable energy and older GPUs to create an AI cloud service that competes on price rather than peak performance.
Competitive Landscape
HIVE joins a crowded field of bitcoin miners pivoting to AI, including IREN, Core Scientific, and TeraWulf, all of which are marketing their grid connections, land, and cooling capabilities for AI workloads. The sector is betting that demand for lower-tier compute will grow as enterprises seek alternatives to scarce, expensive top-tier chips.
Risks and Caution
HIVE cautioned that its Paraguay data center may face delays, cost overruns, or failure to meet performance targets, and that AI infrastructure demand may not materialize as expected. Investors are pricing in expansion before assets are operational, adding to the stock's volatility. The ATM program remains a key risk, as any further share sales could cap upside for current holders.
