Key Takeaways:
Keel Infrastructure's Bitcoin cost basis nearly doubled to $205,946 per coin after the former Bitfarms sold 1,670 BTC since April, the company disclosed Monday.
The pivot from mining to high-performance computing is a "deliberate and consequential transformation," CEO Ben Gagnon said, as Keel shut down all US mining operations by June 29 and divested assets in Argentina and Paraguay.
Q2 2026 revenue fell to $30.4 million from $61 million a year earlier, while the company posted a $65 million net loss for the quarter and $210.3 million for the first half. Keel held 1,861 BTC as of Aug. 7 and plans to liquidate its remaining position during 2026, CFO Jonathan Mir said.
With a cost basis of $205,946, Keel needs Bitcoin to stay well above that level to realize gains on its remaining holdings. The company's $715.5 million cash war chest, assembled largely through convertible note issuances, is expected to fund site development through 2028 as it targets its first AI data center at Moses Lake, Washington, in 2027.
Keel posted Q2 operating losses of $141 million, including $63 million in accelerated depreciation tied to mining-rig shutdowns at Panther Creek and Scrubgrass. Adjusted EBITDA came in at negative $24 million, compared with positive $7 million a year earlier. The company recorded a $20 million change in fair value of Bitcoin and realized loss on Bitcoin, versus a $32 million gain in the year-ago quarter.
The company sold 1,085 Bitcoin for $75 million in proceeds between April 1 and Aug. 7. It still operates rigs in Canada that may produce two or three Bitcoin per day, though Mir said liquidity projections assume no cash contribution from the Bitcoin business this year.
Keel is far from alone in making this leap. Core Scientific and Iris Energy have explored similar transitions, recognizing that the same power infrastructure and cooling systems that support mining can be repurposed for AI workloads. Bitdeer's shares sank 15% on Aug. 10 despite revenue growth and progress on its own AI pivot, showing the market's skepticism about transition economics.
Keel is building a 2.2 gigawatt development pipeline across sites in Pennsylvania, Washington state, and Québec. Moses Lake is expected to be the first fully commissioned and energized data center in 2027, followed by the Pennsylvania projects near the end of that year. The company is negotiating with hyperscalers, AI companies, GPU cloud providers, and large enterprises, with commercial interest exceeding available capacity, Gagnon said.
In June, Keel closed a $458 million convertible senior notes offering, increased from an originally planned $350 million. Total liquidity stood at $819 million as of Aug. 7, up from $533 million at the beginning of May.
The company's $210.3 million in first-half losses shows just how expensive the transition period can be. Keel expects to assess additional capital needs after lease agreements are signed, when it believes its cost of capital could decline.
This article is for informational purposes only and does not constitute investment advice.
