Hut 8 (HUT) shares skyrocketed nearly 30% on Wednesday after the company unveiled a monumental 15-year, $9.8 billion lease for a large-scale AI data center at its Beacon Point campus in Nueces County, Texas. The agreement, structured as a triple-net lease with a 3% annual escalator, covers 352 megawatts of IT capacity and includes renewal options that could push the total contract value to $25.1 billion if all three five-year terms are exercised.
The Beacon Point campus was originally intended for bitcoin mining but was repositioned to meet surging demand for high-performance computing capacity. The pivot highlights a growing trend among publicly listed bitcoin miners, who are currently facing losses of approximately $19,000 per coin produced and are rapidly converting infrastructure to AI and high-compute workloads. With this deal, Hut 8’s total contracted AI data center capacity reaches 597 MW, carrying an aggregate base-term contract value of roughly $16.8 billion.
CEO Asher Genoot emphasized the company’s strategic flexibility: “Beacon Point underscores why we start with power and maintain flexibility across end markets. Operating across multiple applications lets us underwrite assets that single-use-case developers cannot, then redirect them toward higher-value commercialization pathways as demand evolves.”
The facility will be built to NVIDIA’s DSX reference architecture in partnership with American Electric Power, Vertiv, and Jacobs. Initial energization is slated for Q1 2027, with the first data hall delivery expected in Q3 2027. Hut 8 projects the lease will generate approximately $655 million in annual net operating income once stabilized, providing a stable revenue stream to insulate the company from bitcoin mining volatility.
The announcement coincided with Hut 8’s Q1 2026 earnings, which showed revenue of $71 million—up from $21.8 million a year earlier but slightly below Wall Street’s $79.4 million consensus. The quarter included a net loss of $253.1 million, largely due to $295.7 million in unrealized losses on digital assets. As of March 31, the company held about $1.3 billion in combined cash and bitcoin reserves.
Hut 8 joins other former mining giants like Core Scientific, TeraWulf, and IREN in shifting toward AI infrastructure, a move that could see some miners derive up to 70% of their revenue from AI by the end of 2026. The Beacon Point lease marks a definitive step in that direction, solidifying Hut 8’s evolving business model.
