Cipher Digital Posts First HPC Lease Revenue, Expands Barber Lake to $9.1 Billion and Grows Pipeline to 5.9 GW

Cipher Digital Inc. reported its first high-performance computing lease revenue in the third quarter of 2026, a milestone that marks the company's transition from a bitcoin miner into an industrial-scale HPC data center developer. The Nasdaq-listed firm said rent commencement at its Black Pearl campus generated $5.9 million in HPC leasing revenue during the quarter, while multiple data halls across Black Pearl and Barber Lake are scheduled to come online through year-end. The shift matters because it converts years of construction and power procurement into recurring contracted cash flow, and it gives Cipher a verifiable track record as it courts hyperscalers and AI labs for its remaining capacity.

The most consequential development of the quarter was an amendment to the Barber Lake lease that adds a second 10-year term directly with a leading AI lab, extending the agreement to a 20-year term. The change lifts total contracted revenue at the site to approximately $9.1 billion, an increase of roughly $5.2 billion in incremental rent, and establishes a phased delivery schedule aligned with the tenant's compute deployment. Cipher said construction at Barber Lake remains on track to meet the amended milestones. The company also delivered first capacity at Black Pearl, with additional capacity across all three campuses expected to come online in phases over the coming months, while Stingray construction advances with steel erection on schedule and shell construction expected to be completed in the fourth quarter.

On the power side, Cipher received conditional classifications across several pipeline sites through ERCOT's Batch Zero process, including a conditional base load classification for 1 GW at its Colchis site and conditional studied load classifications with Provisional Controllable Load Resource designations for an additional 1.6 GW. The company also began developing lateral natural gas pipelines capable of supporting up to 2.5 GW of on-site generation across multiple sites, and acquired Horizon, a 70 MW site in Texas expected to energize in 2029. Its development pipeline now totals approximately 5.9 GW, including 270 MW of capacity available in 2027 for which tenant discussions and design work continue.

Chief Executive Officer Tyler Page framed the quarter as validation of the company's early strategic choices. "Cipher was built for this market, and this quarter we took important steps to strengthen our position for the long term," he said, adding that decisions about partners, project structure, regulatory navigation and community engagement "were made for exactly these conditions." Page noted that demand for compute is growing and that relationships with leading hyperscalers and AI labs are deepening, with the company investing earlier in every project and advancing design work before committing to new leases.

Cipher also strengthened its balance sheet, completing an $850 million offering of 0.000% convertible senior notes due 2032 to fund additional equity investment into Barber Lake in connection with the lease expansion, with associated capped call transactions raising the effective conversion price to $28.35 per share. It equitized approximately $165.9 million of its 1.750% convertible notes due 2030, retiring more than 90% of those notes. Third-quarter revenue totaled $27 million, including $20.8 million from bitcoin mining, while Adjusted EBITDA was negative $10 million. The results underscore both the promise and the cost of the buildout: interest expense rose to $59 million as long-term borrowings climbed to $5.4 billion, and property and equipment, net, more than quintupled year-over-year to $3.9 billion. For the broader data center industry, Cipher's progress illustrates how power procurement, regulatory classification and long-term hyperscale leasing are becoming the decisive competitive levers in the race to supply AI compute capacity in Texas and beyond.