TeraWulf (NASDAQ:WULF) shares experienced a sharp decline last week, closing at $18.16 on Friday, July 17, 2026. This represents a 17.3% drop compared to the previous Friday and places the stock 4.4% below the $19 per share offering price from its April common stock sale. The downturn occurred even after the company announced a massive $19 billion lease agreement with Anthropic on July 6.
The weekly loss erased all gains that had been built above the April funding level. The decline was not isolated to TeraWulf; peers such as IREN (NASDAQ:IREN) fell 18.3%, CoreWeave (NASDAQ:CRWV) dropped 17.6%, and Core Scientific (NASDAQ:CORZ) lost 10.9%. In contrast, the Nasdaq Composite declined only 2.9% over the same period, suggesting a sector-wide reevaluation of valuations in the capital-intensive AI infrastructure space.
Investor concerns appear centered on financing and delivery risks rather than customer demand. TeraWulf has not yet completed construction of its 401-megawatt Kentucky campus, where Anthropic plans to lease capacity. The lease agreement is structured with phased delivery beginning in late 2027 and continuing into early 2028, with rent payments commencing only upon delivery of each phase. TeraWulf projects $19 billion in contracted revenue over the initial 20-year term, with Anthropic's commitments expected to carry investment-grade backing.
The financing challenge is substantial. Chief Financial Officer Patrick Fleury told Bloomberg that the company plans to raise approximately $3.5 billion in debt, potentially through leveraged loans and high-yield bonds. This proposed debt is roughly 3.4 times the $1.036 billion gross equity raised in April. For context, TeraWulf's first-quarter revenue was only $34 million, with $21 million from HPC leases. Cash and restricted cash stood at $3.1 billion.
Adding to the pressure, New York state on Tuesday paused permits for new data centers with a minimum capacity of 50 megawatts, though existing data centers are unaffected. TeraWulf's Lake Mariner facility in New York is already operational, with CEO Paul Prager stating that all necessary approvals are in place for its ongoing expansion. However, the main contributor to TeraWulf's value is the Kentucky campus, which is outside New York's jurisdiction. The state has yet to finalize its permit rules, creating uncertainty.
Analyst opinions remain divided. Cantor Fitzgerald maintained its Overweight rating and $37 price target, while Rosenblatt's Chris Brendler reaffirmed a Buy rating with a $30 target. Both see long-term potential, but the near-term risks are significant.
Key risks include potential delays in rent payments due to construction timelines, power delivery issues, and debt-market conditions. New York's permit rules are still pending, and Anthropic's rent payments begin only after each phase is delivered. TeraWulf's stock now trades below its previous key equity benchmark, reflecting the market's skepticism about the company's ability to execute on its ambitious plans.
Investors will be watching this week for updates on financing terms and the status of the New York permit. The contract size is enormous, but so is the financing challenge, and the market is clearly pricing in execution risk.
