Riot Platforms, the Colorado-based Bitcoin miner, is undergoing a strategic transformation that is putting pressure on its traditional investor base. The company is pivoting from pure cryptocurrency mining to operating as a landlord for AI data centers, a move that Wall Street is watching closely for execution risks. Shares last traded at $23.49, valuing the company at approximately $8.2 billion.
The shift comes as power availability emerges as a critical bottleneck for the AI buildout. Jefferies analyst Jonathan Petersen noted that interconnected power is one of the largest constraints, bringing older Bitcoin miners back into focus but also raising the bar for execution. Riot reported first-quarter revenue of $167.2 million, calling it a definitive inflection point, with data-center revenue contributing $33.2 million for the first time.
Advanced Micro Devices (AMD) expanded its lease at Riot's Rockdale, Texas facility by 25 megawatts, bringing total contracted capacity to 50 megawatts. The original January lease for 25 megawatts over 10 years was valued at approximately $311 million, and with extensions, the deal could reach $1 billion. AMD CIO Hasmukh Ranjan emphasized the need for partners who can match their pace and scale.
Power supply is now taking center stage. Riot and Terrestrial Energy signed a memorandum of understanding to explore data centers powered by small modular nuclear reactors, specifically Terrestrial's Integral Molten Salt Reactor (IMSR) plants. The plan could include several 390-megawatt units, totaling up to 4 gigawatts of nuclear capacity. Riot CEO Jason Les stressed the need for reliable and predictable energy to serve large cloud and AI clients, while Terrestrial's Simon Irish noted a clear path to deploying IMSR power for AI and high-performance computing.
Valuation is under scrutiny as Riot faces new questions following its AI and nuclear moves. Simply Wall St noted that the nuclear plan does not change the near-term imperative: filling existing Texas data centers and eliminating unused capacity. Jefferies initiated coverage with a hold rating and a $24 price target, while the average analyst target is $24.92, with most analysts still rating the stock a buy. Peers such as Cipher Digital, TeraWulf, and Core Scientific received buy ratings from Jefferies, and Visible Alpha expects several miners to lean more heavily on high-performance computing revenue than Riot this year.
Activist investor Starboard Value is pushing Riot to accelerate its transformation. In a February letter, Starboard's Peter Feld urged Riot to urgently seize the opportunity, calling the AMD lease a positive but small proof-of-concept. Riot's nuclear plan carries clear risks: the first IMSR plants are not expected until the early 2030s, and no small modular reactors have yet gone live. Riot also cites potential setbacks including construction delays, supply chain issues, permitting, financing, or weak demand for large data centers.
Meanwhile, Riot's mining revenue slipped to $111.9 million in the first quarter from $142.9 million a year earlier, as network hash rate jumped 24%. Bitcoin traded near $76,992, underscoring the volatility that drove Riot's interest in AI. The company's dual focus on crypto and AI leaves it exposed to both markets, with investors watching to see if the pivot can deliver sustainable growth.
