Bitdeer Technologies Group Q3 2025 Earnings Call Transcript

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Provided by Quartr
November 10, 2025

Key Takeaways

  • Positive Sentiment: Q3 revenue was $169.7 million (up 173.6% YoY) with adjusted EBITDA of $43 million and gross margin improving to 24.1%, driven by higher self-mining revenue and fleet efficiency.
  • Positive Sentiment: Self-mining scale accelerated—average operating hash rate rose to 29.1 EH/s in Q3 and reached 41.2 EH/s by end‑October, surpassing the company's 40 EH/s target and supporting further margin upside as newer, more efficient Seal Miners are deployed.
  • Positive Sentiment: Bitdeer is pivoting aggressively into AI infrastructure and cloud services—converting multiple sites (TDEL Norway, Clarington OH, Wenatchee WA, Singapore/Malaysia expansions) and says converting up to 200 MW to AI cloud could (in an optimistic scenario) generate an annualized run rate above $2 billion.
  • Neutral Sentiment: ASIC progress is mixed—Seal Miner A3 is in mass production, and the first Seal 04 tape‑out showed promising ~6–7 J/TH chip‑level efficiency with a Q1 2026 mass‑production target, but a next‑generation Seal 04 design is significantly delayed and has driven higher R&D spend.
  • Negative Sentiment: Liquidity and non‑cash items pose risks—IFRS net loss was $266.7 million, operating cash used was $520 million, and the balance sheet shows $196.3 million cash versus $824.3 million borrowings and $672.5 million in derivative liabilities tied to convertible notes (fair‑value swings increase reported volatility).
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Earnings Conference Call
Bitdeer Technologies Group Q3 2025
00:00 / 00:00

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Operator

Thank you for standing by, and welcome to Bitdeer's Third Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press Star 11 on your telephone. To remove yourself from the queue, you may press Star 11 again. I would now like to hand the call over to Yujia Zhai, Investor Relations for Bitdeer. Please go ahead.

Yujia Zhai
Yujia Zhai
Head of Investor Relations at Bitdeer Technologies Group

Thank you, Operator, and good morning, everyone. Welcome to Bitdeer's Third Quarter 2025 Earnings Conference Call. Joining me today are Matt Kong, Chief Business Officer; Haris Basit, Chief Strategy Officer; and Jeff LaBerge, VP of Capital Markets and Strategy. Haris will begin today by providing a high-level overview of Bitdeer's Third Quarter 2025 results, and then cover the company's strategy and a detailed business update. After that, Jeff will cover Bitdeer's Third Quarter financial results in more detail, and then we will open the call for questions. To accompany today's earnings call, we have provided a supplemental investor presentation. This presentation can be found on Bitdeer's Investor Relations website under Webcasts and Presentations. Before management begins their formal remarks, we would like to remind everyone that during today's call, we may make certain forward-looking statements.

Yujia Zhai
Yujia Zhai
Head of Investor Relations at Bitdeer Technologies Group

These statements are based on management's current expectations and are subject to risks and uncertainties, which may cause actual results to differ materially. For a more complete discussion on forward-looking statements and the risks and uncertainties related to Bitdeer's business, please refer to its filings with the SEC. Further, in addition to discussing results that are calculated in accordance with International Financial Reporting Standards, or IFRS, we will also make references to certain non-IFRS financial measures, such as adjusted EBITDA and adjusted profit and loss. For more detailed information on our non-IFRS financial measures, please refer to our earnings release that was published earlier today, which can be found on Bitdeer's IR website. Thank you. I will now turn the call over to Haris. Haris?

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Thank you, Yujia, and good day, everyone. It's great to be with you today. Since our last call, we've made significant progress across all of our strategic priorities, and I'm excited to share how Bitdeer is growing from a global leader in Bitcoin mining into a vertically integrated Bitcoin infrastructure and AI platform. Let's start with the numbers on slide three. Q3 marked a period of rapid growth and strong execution. In the third quarter, total revenue reached $169.7 million, up 173.6% year-over-year and up 9.1% sequentially. Gross profit came in at $40.8 million, and adjusted EBITDA increased to $43 million, both substantially improved from Q2. This performance reflects continued execution in our self-mining business. Mass production of our Seal Miner ASICs drove a 273.1% year-over-year and 105.4% sequential increase in our average operating self-mining hash rate to 29.1 EH/s.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

As of the end of October, we achieved 41.2 EH/s, surpassing our 40 EH/s target that we set out at the beginning of the year. Looking forward, we plan to continue deploying our Seal Miner ASICs to fill our substantial global power pipeline. Through a combination of decommissioning older generation rigs and adding new Seal Miner ASICs, we expect meaningful growth throughout 2026, which will ensure we remain one of the world's largest Bitcoin miners. In addition to hash rate growth, we expect continual improvement in our fleet-wide energy efficiency to drive increased margins and profitability in the quarters ahead. Our investments in chip design, data center infrastructure, and global power portfolio are paying off, not only in strong financial performance but also positioning us for the next major wave of demand for compute.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Our Bitdeer AI Cloud Services business continues to scale, reaching an annualized revenue run rate of $8 million at the end of October. As of October 31, we operate 584 GPUs with an 87% utilization rate. Our newest B200 systems, installed late in Q3, are being tested by customers and will drive additional revenue. We are finalizing deployment for NVIDIA's GB200 systems and expect to reach 1,160 GPUs operated by the end of the year. We are also in the process of procuring NVIDIA's next-generation GB300 and B300 systems. As we look ahead, Bitdeer's growth will be anchored by three strategic pillars: Bitcoin mining, ASIC development, and HPC AI. Together, these represent a vertically integrated, highly defensible platform that leverages our technology expertise and extensive power portfolio. To accelerate our AI footprint, we are taking bold, deliberate steps to simultaneously pursue both colocation and cloud services.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

With respect to colocation, on our last earnings call, we guided the market that we intended to pursue a joint venture model with a development partner. In September, due to a significant increase in market demand, we let the exclusivity period under our LOI with this development partner expire. This was a strategic decision that gives us greater flexibility and allows us to take a more direct role in the HPC AI data center market and retain more of the economics. We intend to develop data centers using our own internal development team, which will be significantly augmented through strategic hiring alongside highly experienced EPCs and general contractors on a fee basis. Regarding our cloud services business, over the past 18 months, we have developed a fully vertically integrated AI infrastructure platform in Singapore that includes bare metal GPUs as well as orchestration, networking, and managed services.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

These additional services are highly sought after by small and mid-sized enterprise customers who require more than just bare metal offerings and are being underserved in today's market. Now that we have a proven concept in Singapore, we are ready to expand this business line into Malaysia, the U.S., and Europe. Our current customer discussions range from early to mid-stage startups in the biomedical, robotics, and gaming industries to more traditional U.S. enterprise customers seeking to expand their footprint. We will provide additional details as this business model develops over the coming months. Moving now to our HPC AI infrastructure plans. For our 570-megawatt Clarington, Ohio site, we have already begun the design and procurement process for an HPC AI-suitable substation, which is expected to be energized in the first half of 2027.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

The local utility at Clarington has confirmed the full 570 MW will be available by the end of Q3 2026, nearly a year earlier than expected. Given its size, the Clarington site could be utilized for our cloud services business or colocation. At the same time, we have made the decision to convert our 175-megawatt TDEL site in Norway into an AI data center by Q4 2026. Given the announcement of Stargate Norway in July, we have seen a significant increase in inbound interest from potential tenants, so we believe this site could be used for either our cloud services business or colocation. The site was designed by our local Norway team with HPC AI in mind as the end use, so it already includes liquid cooling capabilities and a more robust electrical infrastructure.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Furthermore, it utilizes a substation that is powered by 18 hydropower generators and one wind farm, giving it a high degree of reliability. Our current analysis indicates that the site could be ready to accept GPUs by the second half of 2026, with conversion costs well below U.S. and European AI data center benchmarks. Additionally, we plan to expand our Singapore cloud services business into Malaysia. Through a combination of owned and leased opportunities, we anticipate activating up to 15 MW of cloud services capacity in Malaysia during 2026, with the ability to expand significantly beyond that if demand persists. We are also upgrading our 13-megawatt Wenatchee, Washington site using a proprietary modular data center technology. This conversion is expected to be completed by Q4 2026.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Further, we have initiated the conversion of 10 MW of power capacity at our Knoxville, Tennessee site into an AI data center with targeted completion in Q4 2026. We are evaluating potential U.S. data center rental opportunities to bring our AI cloud services online domestically as early as Q1 2026. In summary, the supply and demand imbalance for AI compute continues to widen, and we expect this shortage to persist well into 2027. Based on our estimates, under the most optimistic scenario, converting 200 MW of our power capacity fully towards AI cloud services could generate an annualized revenue run rate exceeding $2 billion by the end of 2026. Turning to our ASIC business, when we launched our aggressive ASIC roadmap last year, our goal was clear: industry leadership in performance and energy efficiency. Our R&D team has delivered on that promise.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

In September, we launched the Seal Miner A3 Series, now among the most energy-efficient products in the market. Mass production has started, and initial shipments are expected this month. We anticipate the A3 series will generate meaningful revenue in 2026. Looking ahead, our focus shifts to our Seal 04 chip. To de-risk the development and ensure success, we are pursuing two distinct design approaches. The tape-out for the first Seal 04 design was completed in September, and latest sample verification demonstrated approximately 6-7 joules per terahash power efficiency at the chip level under low-voltage ultra-power-saving mode. We are targeting mass production to begin in Q1 2026. In the meanwhile, development of the next-generation Seal 04 is significantly delayed. Next, let's turn to our energy infrastructure shown on slides 7-11 in the supplemental investor presentation.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

In Q3, we continued our rapid build-out of our global power and data center portfolio. As of October 2025, we fully energized the TDEL, Norway site and the full 500 MW in Jigmaling, Bhutan. This brings our total available electrical capacity to approximately 1.6 GW and our total global power pipeline to approximately 3 GW. For our AI cloud services and colocation strategy, we believe we have one of the most attractive power portfolios in the industry. Across our sites in Clarington, Ohio, TDEL, Norway, and Wenatchee, Washington, we will have over 1.3 GW of HPC-suitable power by Q2 2027. This gives us a significant advantage in time to power and the ability to deploy massive GPU capacity rapidly. In September, we announced a new 300-megawatt site in Niles, Ohio. The project remains on track for energization in Q1 2029.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

The site spans 41.8 acres and includes an interconnection agreement with FirstEnergy. It is located about 75 mi from our Massillon, Ohio site, and 125 mi from our Clarington, Ohio site. We continue to secure low-cost power sites globally, reinforcing our competitive advantage in both mining and AI infrastructure. In summary, we are proud of our team's execution this quarter. These efforts are already reflected in our financial results and have established a scalable foundation for long-term growth. Thank you. I'll now turn it over to Jeff LaBerge, our VP of Capital Markets and Strategy, to go over our detailed financial results for the quarter.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

Thank you, Haris. Before I go over Bitdeer's third-quarter financial results, I'd like to remind everyone that all figures I refer to today are in U.S. dollars.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

Q3 consolidated revenue was $169.7 million, up from $62 million in Q3 2024 and $155.6 million in Q2 2025, or up 173.6% year-over-year and 9.1% sequentially. Self-mining revenue was $130.9 million versus $31.5 million in Q3 2024 and $59.3 million in Q2 2025, or up 315.6% year-over-year and up 120.7% sequentially. These results were primarily due to a 273.1% year-over-year and 105.4% sequential increase in self-mining hash rate, as well as higher Bitcoin prices. These increases were partially offset by higher mining difficulty. Seal Miner sales revenue was $11.4 million compared to $0 in Q3 2024 and $69.5 million in Q2 2025. Total gross profit for the quarter was $40.8 million versus $2.8 million in Q3 2024 and $12.8 million in Q2 2025. Gross margin was 24.1% versus 4.5% in Q3 2024 and 8.2% in Q2 2025.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

The year-over-year and sequential increase in our gross margin was primarily driven by higher self-mining revenue and improved fleet efficiency. We expect to continue gross margin improvements over the coming quarters as our hash rate ramps up and overall fleet efficiency improves. Total operating expenses for the quarter were $60.5 million versus $42.9 million in Q3 2024 and $42.3 million in Q2 2025. The year-over-year and sequential increase was primarily driven by the one-off R&D costs for the Seal 04 chip development and tape-out and non-cash amortization expenses of intangible assets related to the acquisition of Freechain. Other operating income was $26.5 million, primarily due to a $22.2 million mark-to-market adjustment to our cryptocurrency receivables. As a reminder, under IFRS, Bitcoin and other cryptocurrencies are classified as intangible assets and are measured at cost less any accumulated impairment losses, with no subsequent upward revaluation permitted.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

However, during the quarter, we entered into a $100 million Bitcoin-backed loan facility, pledging approximately 1,400 Bitcoin as collateral. As a result, these Bitcoin were reclassified as cryptocurrency receivable. IFRS requires that any cryptocurrency held as a receivable or payable be mark-to-market, which led to this adjustment. Other net loss for the quarter was $238.5 million versus $14.7 million in Q3 2024 and $108.5 million in Q2 2025. The net loss was due to the non-cash derivative losses on the convertible senior notes issued in August 2024, November 2024, and June 2025, which I will discuss in more detail in the liability section. IFRS net loss was $266.7 million versus $50.1 million in Q3 2024 and $147.7 million in Q2 2025. Adjusted loss was $32.8 million versus $25.6 million in Q3 2024 versus $24.4 million in Q2 2025.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

The increase in loss was primarily due to higher operating expenses and interest expense related to the increased borrowings, partially offset by the year-over-year higher revenue and gross profit margins. Adjusted EBITDA was positive $43 million versus negative $7.9 million in Q3 2024 and positive $17.3 million in Q2 2025. The year-over-year growth was primarily driven by significantly higher self-mining hash rate as a result of the company's mass production and deployment of Seal Miner A1 and A2 during 2025. Note that both the adjusted loss and adjusted EBITDA figures for the quarter do not include the $22.2 million favorable mark-to-market gain from Bitcoin pledged as collateral. This quarter's higher year-over-year and sequential top-line and non-GAAP bottom-line performance was mainly driven by higher self-mining hash rate, Seal Miner sales, and higher Bitcoin prices. These were partially offset by higher global network hash rate and higher R&D costs, as previously described.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

Net cash used for operating activities was negative $520 million, primarily driven by Seal Miner's supply chain and manufacturing costs, electricity costs from the mining business, general corporate overhead, and interest expense. Net cash generated from investing activities was $27 million, which was driven by $60 million of capital expenditure, of which $32 million was related to data center infrastructure and related construction. Proceeds from disposal of cryptocurrencies from our primary business was $89 million. Net cash generated from financing activities for the quarter was $388 million, which resulted primarily from approximately $320 million of borrowing from a related party and $91 million of proceeds from shares sold under our ATM program, partially offset by $48 million of repayments of borrowings.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

Moving to our 2025 infrastructure spend, we expect CapEx for the continued build-out of our global power and data center infrastructure to be in the range of $210 million-$240 million for calendar year 2025. This range includes reported infrastructure CapEx from the previous nine months of approximately $168 million. The remaining projected CapEx is expected to fund the completion or near completion of our data centers in TDEL, Norway, Jigmaling, Bhutan, Massillon, Ohio, and Ethiopia, as well as the partial completion of the 101-megawatt gas-fired power plant in Alberta, Canada. Please note that this guidance only factors in power and data center and does not include CapEx for Seal Miners and GPUs.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

In terms of our balance sheet, we ended the quarter in a strong financial position with $196.3 million in cash and cash equivalents, $82.2 million in cryptocurrencies held at cost less impairment, $163.9 million in cryptocurrency receivable held at fair market value, and $824.3 million in borrowings excluding derivative liabilities. Please note the $82.2 million in cryptocurrencies is accounted for according to IFRS rules and is currently below its market value. Derivative liabilities were $672.5 million, which relate to the November 2024 and June 2025 convertible senior notes, representing a $234.6 million increase compared to the last quarter. This is a non-cash fair value adjustment driven by the increase in our stock price and does not impact our liquidity or operations. Under IFRS, certain derivative instruments, such as warrants and convertible debt, are required to be revalued at fair market value each reporting period.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

As our stock price increases, the fair value of these instruments rises, resulting in a higher reported liability and vice versa. The reported liability will ultimately be netted at settlement, either upon conversion to equity or expiration, and does not represent an actual cash outflow. Finally, regarding our outstanding ATM facility, we have sold 6.2 million additional shares during the quarter. Thank you, everyone. That concludes the prepared remarks section of our earnings call. Operator, please open the call for questions.

Operator

Thank you, sir. As a reminder to ask a question, you will need to press star 11 on your telephone. To remove yourself from the queue, you may press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Greg Lewis of BTIG. Please go ahead, Greg.

Greg Lewis
Analyst at BTIG LLC

Yes, hi.

Greg Lewis
Analyst at BTIG LLC

Thank you and good morning and good afternoon, and thanks for taking my questions. You know, Haris, thanks for the update on kind of the progression of the HPC opportunity as you guys think about it. I wanted to talk a little bit about that. You called out a few of the sites. I mean, it sounds like Washington and maybe Tennessee could maybe move up in the queue just given their size. I guess, as we think about beyond, I guess, first, if you could talk a little bit more how you see the opportunity in Asia progressing, and then as we kind of continue to gain momentum in Asia, how we're able to kind of expand that into the U.S. Hello? You can hear me? You can't? You can hear me? Okay.

Operator

Gentlemen, please make sure your lines are unmuted and if you're on speakerphone, lift your hands up.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Okay.

Greg Lewis
Analyst at BTIG LLC

Hey, Haris, I just heard you, but there was an echo.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Yeah. Let me see if I can get this fixed.

Greg Lewis
Analyst at BTIG LLC

Hey, Jeff, if you're on the line, I guess I'd be curious to know about it looked like we added a site in Ohio, Niles, Ohio. Are you there? No. Okay. Let's wait.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Okay. Can you hear me okay?

Operator

Yes, sir. Please proceed.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Yeah. Okay. So sorry about that. I'm not sure what was going on. AI. Greg, let me answer your question. I answered it once, but I think nobody heard me. It's not that we're going to do Malaysia first and then go to the U.S. We're doing both simultaneously. We're definitely moving forward in Malaysia and also in a number of locations outside of the U.S.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

So that's, I think, the answer to your first question. Did you have a second question? I can't remember what it was.

Greg Lewis
Analyst at BTIG LLC

Yeah. Yeah. I mean, and I guess I was curious, are all these sites going to be NVIDIA? Are you only looking at, it sounds like we're focused on the H300s. Is that going to kind of, or could we see, it seems like some of these other data center potential suppliers are looking beyond NVIDIA. I know at one point you were also looking to develop something beyond just an ASIC chip as well.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Right now, everything that we're doing in AI is largely NVIDIA-based. We're not looking at developing our own AI chip at the moment, if that's what your question was.

Greg Lewis
Analyst at BTIG LLC

Okay. My other question was around the, I guess, we acquired a new site, Niles, Ohio.

Greg Lewis
Analyst at BTIG LLC

I'd be curious, what was kind of the process in that? Was that a site that would have been looking at? I'm trying to understand, I guess, a couple of things. One is realizing every site's different. How should we think about the timing of incremental site allocations? I'd be curious about that.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Yeah. I agree. Yeah. The Niles, Ohio site was actually acquired a few months ago. We just finalized it and made the announcement last month. Strategic acquisition, it's less than 100 mi from both of our other sites in Ohio. Energization does not come until Q1 2029, so it's a little ways out. We just think the site gives us additional optionality depending on what direction we go with the Clarington and the Massillon site long-term. Just long-term optionality is how we're thinking about that.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

In general, we are in a mode of actively looking for sites that might be useful. We have a group that's actively doing that. Okay.

Greg Lewis
Analyst at BTIG LLC

Super helpful. Thank you very much.

Operator

Thank you. Our next question comes from the line of Kevin Cassidy of Rosenblatt Securities. Please go ahead, Kevin.

Chris Myers
Chris Myers
Equity Research Associate at Rosenblatt Securities

Hi. This is Chris Myers on for Kevin Cassidy. I'm just looking if you guys could provide some additional specifics on the reason for the delay of the 04 Seal Miner chip.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Yeah. Just to be clear, it's the new generation of architecture. We are very confident in the technology still. It's really just that the implementation of it is quite a bit more difficult than we originally anticipated and does involve significant changes to the design flow and the EDA tools.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

And so we're just working through those things to do that, and that's really the source of the delay.

Chris Myers
Chris Myers
Equity Research Associate at Rosenblatt Securities

Okay. Thank you. And if I could ask a follow-up, are there any additional R&D expenses as those come to market, as the Seal Miner A4 comes to market?

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

I mean, I don't think there's going to be any especially unusual R&D expenses. Of course, there are R&D expenses associated with any chip.

Chris Myers
Chris Myers
Equity Research Associate at Rosenblatt Securities

Right. And then I guess if I could ask one last follow-up, if you could describe the cost difference between assembling these Seal Miners in the U.S. versus outside of the U.S., provide a little detail on that would be great.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

Obviously, there'll be a slight increase in the production costs for ones done in the U.S.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

If you think about the cost of a Seal Miner, about 70%-75% of the cost is the chip. The remaining 25%-30% is the balance of the manufacturing, which is really where the delta will be on. Yes, we would expect that to be higher in most cases, but again, depending on what the tariff is for exporting countries, we do not have an exact number for you at this time.

Chris Myers
Chris Myers
Equity Research Associate at Rosenblatt Securities

I appreciate the detail and congratulations on the good result.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

Thank you.

Operator

Thank you. Our next question comes from the line of Mike Grondahl of Northland. Please go ahead, Mike.

Mike Grondahl
Mike Grondahl
Analyst at Northland Capital Markets

Yeah. Hey, guys. Two questions. One, how will you decide whether you'll go the cloud service provider route versus the co-location route? Any insight there would be helpful.

Mike Grondahl
Mike Grondahl
Analyst at Northland Capital Markets

Two, could you talk a little bit about the demand you're seeing in Norway and how that compares to the demand for some of your U.S. sites?

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Yeah. With respect to AI cloud versus co-location, we are definitely putting our emphasis on the AI cloud space. We will opportunistically use co-location where it might make sense, but our primary focus is on AI cloud. With regards to Norway, yeah, I mean, the demand is largely driven by that site being one of the few places in Europe where you can get a large site with low power. In the very specific case of our site, it's very much developed towards already being a tier three type of data center. It does not take much effort or as much resources to change it as it would a normal Bitcoin mining site.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

There was a lot of interest. There is a lot of interest in that site for those reasons. Is the demand greater for that site as compared to maybe a U.S. site? I don't know. I mean, perhaps because it's so close to being a fully developed tier three site, the answer is probably yes. It just takes less effort to turn it into an AI data center than our U.S. sites. Yeah. I think time to power has really been what's been driving the demand for it. Obviously, the site, as Haris said, has a lot of attractive attributes that make the time to power much shorter. We think we can have this up and running sometime in the second half of next year, possibly. I think that's driving a lot of it.

Mike Grondahl
Mike Grondahl
Analyst at Northland Capital Markets

Great. Hey, thanks, guys.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

You bet.

Operator

Thank you.

Operator

Our next question comes from the line of Nick Giles of B. Riley Securities. Please go ahead, Nick.

Nick Giles
Nick Giles
Analyst at B. Riley Securities

Good morning, everyone. I apologize for the noise in the background. I wanted to ask a question regarding your financial options for development of the HPC AI capacity. To what extent do you expect that to be funded by your G&D partner? Additionally, is there any impact on your cost of capital from your BTC holdings, given that they could potentially be used as collateral and help bring the rates down? Thank you.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

Sorry, you have a lot of background noise there. I am not sure we caught that. Were you asking about a development partner?

Nick Giles
Nick Giles
Analyst at B. Riley Securities

Yeah, Jeff, apologies. I am in transit. The question is basically on your financing options for the development of HPC and AI.

Nick Giles
Nick Giles
Analyst at B. Riley Securities

I would wonder, to what extent do you expect total CapEx to be funded by your JV partner? Is there any impact on your cost of capital from Bitcoin holdings? Because I would assume they could potentially be used as collateral and help bring the rate down. Thank you.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

At the present time, we do not have a JV partner in this development of HPC AI.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

We had initially guided that we were going to approach it using a joint venture partner, development partner. We did have an LOI with a group previously this year. We let that LOI expire in favor of basically pursuing the opportunity more on our own using fee-based EPC contractors and augmenting our own internal development team.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Not to say we may not pursue it in the future, but at the present time, our strategy is to pursue it more on our own.

Nick Giles
Nick Giles
Analyst at B. Riley Securities

Thanks. That's clear. My follow-up is about regarding the most optimistic scenario where you outline 200 MW of AI cloud capacity. Could you provide more detail on how this capacity will be allocated across your site if possible? Thank you.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

I'm having trouble understanding the question. Sorry about that.

Nick Giles
Nick Giles
Analyst at B. Riley Securities

No. Can you hear me? I mean, it is about 200 MW of AI cloud capacity that you outline as a—I see. Okay. Yeah. Yeah. If you can provide the split between your sites, it would be helpful.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Of the 200 MW, right, that includes Malaysia, includes Singapore, includes Wenatchee, includes TDEL in Norway. We expect the vast majority of that to be in AI cloud as opposed to co-location.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Is that the question? Did I answer your question?

Nick Giles
Nick Giles
Analyst at B. Riley Securities

Yes. Thank you very much. I apologize once again for the background. Thank you.

Operator

Thank you. Our next question comes from the line of Mike Colonnese of HC Wainwright & Company. Please go ahead, Mike.

Mike Colonnese
Mike Colonnese
Analyst at H.C. Wainwright & Co

Hey, good morning, guys. I appreciate all the updates today. Just a couple for me. First one, as an ASIC manufacturer with better visibility into chip availability, do you foresee any procurement risks with regards to securing some of the latest-gen GPUs from NVIDIA for the broader AI infrastructure industry?

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

We have not seen anything so far. I mean, I am not sure that Jeff and I are well positioned to answer that question right now because we are not directly in the procurement.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

We're getting what we require for Bitdeer, but our initial orders are relatively small, so I'm not sure if they're indicative of the industry at all.

Mike Colonnese
Mike Colonnese
Analyst at H.C. Wainwright & Co

Got it. Got it. And Haris, you mentioned in your prepared remarks that you intend to continue to deploy your Seal Miner ASICs across your sites as they continue to build out the Bitcoin mining business in 2026. I guess, how should we think about growth coming out of this year and looking into next year for Bitcoin mining?

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

We haven't released any estimates on that yet, but it will be significant. We're not plateauing at the level that we're at now. We're still on a very steep upward trajectory.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

Yeah. Mike, I would just add, I think we've got a lot of levers to pull there. We've got new capacity coming online in Massillon, Ohio, 221 MW. Ethiopia is 50 MW.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

We have some unused capacity in some of our current sites right now. We also have a couple of hundred megawatts that is dedicated to older generation miners that we'll be looking to replace in the coming months. It will really be a capacity, and ASIC manufacturing will be sort of the bottleneck, not power.

Mike Colonnese
Mike Colonnese
Analyst at H.C. Wainwright & Co

Got it. Helpful, Colin. Appreciate you taking my questions.

Jeff LaBerge
Jeff LaBerge
VP of Capital Markets and Strategy at Bitdeer Technologies Group

You bet.

Operator

Thank you. Our next question comes from the line of Dylan Heslin of Roth Capital Partners. Your question, please, Dylan.

Dylan Heslin
Dylan Heslin
Analyst at Roth Capital Partners

Hey, thanks. Good morning. To follow up on some of the AI cloud things about the $2 billion ARR, how do you sort of expect your customer base to be across that $2 billion?

Dylan Heslin
Dylan Heslin
Analyst at Roth Capital Partners

I know you mentioned some of the industries you're working in, but do you expect it to be multiple big customers, or are we talking 10, 20, 30, or 30-plus small contracts?

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

I think it'll be a combination of both. In places like Asia, we are seeing a lot of demand from that. I would say small to middle market companies that are looking to stand up some AI models in some of those industries that we mentioned. We're also seeing demand from larger, call it medium and large-sized enterprise customers that are looking to deploy high double, low triple-digit megawatts in GPUs. I think to get to that number, as we kind of laid out as our most optimistic scenario, would likely involve a combination of both, both small and middle market and maybe one or two larger enterprise customers.

Dylan Heslin
Dylan Heslin
Analyst at Roth Capital Partners

Got it. Thanks.

Dylan Heslin
Dylan Heslin
Analyst at Roth Capital Partners

As a follow-up, on the data center build side of things, how are you guys seeing build costs and supply chain trending as you sort of get closer to finishing, I guess, a lot of these sites that are in the pipeline?

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Yeah. Look, I think the long lead time items are still the same ones as we know from before. It's a lot of the electrical equipment, transformers, switchgears, breakers, things like that. Look, I think they're out there to be found. We've got a very experienced procurement team. This is not the first time where this type of equipment has been in high demand and shortages, and we've had success sourcing it in the past. I think some of the potential tenants and other EPCs that we may be working with, there's a possibility that they have some of that stuff kind of queued up as well.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

I think there's avenues to get it, but I think the supply chain still remains stressed to some extent. Great. Thanks for taking my question.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

You bet.

Operator

Thank you. Our next question comes from the line of John Todaro of Needyman Company. Please go ahead, John.

John Todaro
John Todaro
Analyst at Needham & Company

Hey, guys. Thanks for taking my question. I just wanted to confirm stuff from earlier. One, it does seem like the focus is more on AI cloud, so GPU as a service versus HPC colo. Are you just seeing a lot more demand in that area? Should we also expect the Ohio sites would be more geared for AI cloud versus a colo lead? I have a follow-up.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

The Ohio site, yes, I think the answer is yes, it could be more for AI cloud, but it's a large enough site where it could be divided as well.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

The final determination of that site is not clear at the moment. Would you have a follow-up question, you said?

John Todaro
John Todaro
Analyst at Needham & Company

Yes. Also, just within that, I guess, are you seeing more customer demand for AI cloud versus colo? My follow-up would be, just as you think about procuring more megawatts out there, we have heard from some peers that there is kind of a stranded power available. Is there kind of a guardrail of how much additional capacity maybe annually you guys think you could procure?

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

We're seeing a lot of demand for both colo and AI cloud. It's hard to quantify which one is more or less, but we're seeing a lot for both. Yeah. I would agree with that. I don't think it's just different demand.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

I mean, obviously, different types of customers are looking forward. Sometimes the same customers are. I think the demand right now is robust. Time to power, I think, is the most critical and most recurring thing we're hearing. 2026, early 2027 power is desirable right now. I think for both business models. On the power procurement side, yeah. I mean, look, I think we're seeing that too. There is some strand of power. I think we're seeing also more of a willingness for tenants and end users to be more accepting of that type of power, behind-the-meter power potentially. We're seeing that. Like I said, we've got a great procurement team that's been able to acquire low-cost power sites in the past, and we're confident in their ability to continue to do so.

John Todaro
John Todaro
Analyst at Needham & Company

Great. Thanks, guys. Appreciate it.

Operator

Thank you.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Again, to ask a question, please press star 11 on your telephone. Again, that's star 11 to ask a question. Our next question comes from the line of Bill Papanastasiou of KBW. Your line is open, Bill.

Bill Papanastasiou
Bill Papanastasiou
Analyst at Keefe, Bruyette & Woods

Yeah. Good morning, gentlemen. Thank you for taking my questions. With respect to the delayed development of the Seal 04 Miner, where would you say the confidence level sits today with respect to this ASIC having industry-leading specs when it gets released? Just trying to understand the extent of the delay. Thank you.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

The confidence is high that the architecture is the right one to go for in future designs. I do not think there is any real lack of confidence in that and that for subsequent designs, we would be using an architecture like this. Where the confidence is low is the exact timing of the release.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Bill, did you have a follow-up question?

Bill Papanastasiou
Bill Papanastasiou
Analyst at Keefe, Bruyette & Woods

No, just that question. Thank you for taking the call. Yeah.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Great. I think we have one more.

Operator

I'm sorry. Our next question comes from the line of Brian Kinstlinger of Alliance Global Partners. Your line is open, Brian.

Brian Kinstlinger
Brian Kinstlinger
Analyst at Alliance Global Partners

Great. Thanks so much for taking my question. I'm just wondering if you can help provide some sort of estimates or how you see return on invested capital for cloud service provider versus co-location services.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Yeah. Look, I think it's a different return profile.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

Obviously, we've seen some of our peers out there putting numbers out, and I think those numbers are largely accurate depending on how you're looking at it with, I would say, both the if you're looking at both the GPUs and the data center costs in there and an IRR specific to both, I think they can be obviously different. We're seeing co-location, obviously, the rates very similar to what others have reported recently. That's typically a yield on cost. I think it's just going to depend on your construction costs, where you're constructing, and I think the end user. I think we're seeing a lot of variance in end user requirements as far as infrastructure needs, where the backup power is required, where they'll be providing some of the kind of key infrastructure there.

Haris Basit
Haris Basit
Chief Strategy Officer at Bitdeer Technologies Group

That, on the co-location side especially, I think is going to really affect your return on invested capital or any of the other return metrics.

Brian Kinstlinger
Brian Kinstlinger
Analyst at Alliance Global Partners

Okay. Thanks.

Operator

Ladies and gentlemen, that does conclude the Q&A portion of our call and Bitdeer's conference for today. Thank you for participating. You may now disconnect.

Executives
    • Jeff LaBerge
      Jeff LaBerge
      VP of Capital Markets and Strategy
    • Yujia Zhai
      Yujia Zhai
      Head of Investor Relations
    • Haris Basit
      Haris Basit
      Chief Strategy Officer
Analysts
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