Shares of TeraWulf Inc. (NASDAQ: WULF) surged approximately 6.7% in late trading on Monday, reaching around $18.85, after B. Riley Securities lifted its price target to $40 from $32 and reiterated a Buy rating. The move came as investors increasingly view the company as a data-center infrastructure play rather than a pure bitcoin proxy.
Lease Revenue Density Outperforms
According to preliminary analysis, the annual revenue per critical megawatt from Anthropic's 20-year lease is about $2.37 million, roughly 27% higher than the $1.86 million generated by Fluidstack's 10-year agreements. This revenue density advantage underscores TeraWulf's ability to secure premium contracts for its AI-focused data center capacity.
The company has signed three major customer agreements: Anthropic (20 years, ~401 critical IT MW, ~$19.0 billion initial-term revenue), Fluidstack (10 years, ~360 critical IT MW, ~$6.7 billion), and Core42 (10 years, 72.5 GPU-optimized MW, ~$1.1 billion). Combined, these contracts represent approximately $26.8 billion in initial-term revenue, or about $1.73 billion on an annualized basis.
However, revenue recognition will be staggered. Fluidstack deliveries extend through 2026, while Anthropic begins in 2027 and reaches full capacity by early 2028. Core42's figures are based on a different capacity definition, limiting comparability.
Market Context and Peer Comparison
Monday's rally outpaced bitcoin, which gained less than 1%, while the Nasdaq Composite climbed 2.21% on AI-related strength. TeraWulf's performance lagged leading data-center peers such as CoreWeave (up 19.3%), Core Scientific (up 9.9%), and Cipher Digital (up 10.0%), but it tracked closely with IREN Ltd. (up 7.6%).
The stock's weekly performance has been volatile. After falling 4.3% between July 24 and July 31, Monday's gain offset the decline. The recent pullback in AI infrastructure stocks was described by B. Riley as overdone, justifying the higher price target.
Upcoming Earnings and Analyst Expectations
Investors now look ahead to TeraWulf's second-quarter results, scheduled for release on Wednesday, August 5, before the market opens. Analysts' preliminary consensus revenue estimate is $44.71 million, which would represent a 6.2% year-over-year decline but a 31.5% sequential increase.
In the first quarter, the company reported $34.0 million in revenue, with high-performance computing (HPC) leases contributing $21.0 million, or 62% of total revenue. This marked a shift toward a more contracted revenue model, as described by CFO Patrick Fleury. The second quarter's lease contribution will reveal whether this momentum continues.
Key Risks and Considerations
Despite the positive outlook, several risks remain. Interest expense in the first quarter totaled $67.1 million, and stock-based compensation amounted to $101.4 million. Major projects still require construction and customer approval, and delays, cost overruns, or additional dilution could offset the benefits of higher contract values.
Additionally, Fluidstack's leases are backed by a $3.2 billion guarantee from Alphabet's Google unit, which provides credit assurance but also highlights the importance of customer credit quality. Investors will also monitor the status of the Abernathy stake sale and capital expenditure figures in the upcoming report.
B. Riley's $40 price target implies roughly 112% upside from Monday's early price, reflecting confidence in TeraWulf's positioning within the AI infrastructure boom. However, this remains an analyst estimate and not formal company guidance.
