Keel Infrastructure reported a wider second-quarter loss as it continued its transition from Bitcoin mining to developing high-performance computing and artificial intelligence data centers in the U.S. and Canada.
Chief Executive Officer Ben Gagnon said the company has spent the past 18 months repositioning its business around power-constrained data center development, exiting Latin America and Bitcoin operations in the U.S. while rebuilding its balance sheet and advancing three priority sites.
“The defining constraint” for AI infrastructure is power rather than chips or capital, Gagnon said, adding that Keel is now in active commercial discussions with potential tenants at its Moses Lake, Washington; Sharon, Pennsylvania; and Panther Creek, Pennsylvania, sites.
Second-quarter results reflect mining exit
Revenue for the second quarter was $30 million, down from $61 million a year earlier. Chief Financial Officer Jonathan Mir attributed the decline primarily to lower average Bitcoin prices and the shutdown of Moses Lake cryptocurrency mining operations during the quarter.
Keel reported an operating loss of $141 million, compared with operating income of $11 million in the prior-year period. The quarterly operating loss included $63 million in accelerated depreciation related to mining-rig shutdowns at the Panther Creek and Scrubgrass locations.
- Loss from continuing operations was $64 million, or $0.11 per share, compared with income from continuing operations of $13 million in the second quarter of 2025.
- Adjusted EBITDA was 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, compared with a $32 million gain in the year-ago quarter.
Mir said operating margins were affected by the Bitcoin-price decline, increased general and administrative expenses associated with hiring senior subject-matter experts, and higher stock-based compensation. Cash SG&A averaged $23 million per quarter in the first half, and Keel is tracking toward $100 million in cash SG&A for the full year.
The company sold 1,085 Bitcoin for $75 million in proceeds between April 1 and Aug. 7. It held 1,861 Bitcoin as of Aug. 7 and said it intends to liquidate its Bitcoin position during 2026. While the company still operates rigs in Canada that may produce two or three Bitcoin per day, Mir said Keel’s liquidity projections assume no cash contribution from the Bitcoin business this year.
Capital raised for expansion capacity
In June, Keel closed a $458 million convertible senior notes offering, which was increased from an originally planned $350 million offering. Mir said the proceeds are earmarked to expand power capacity at the company’s Panther Creek and Scrubgrass sites rather than to pursue new development projects.
Total liquidity stood at $819 million as of Aug. 7, up from $533 million at the beginning of May. The company said its liquidity is expected to support site development through lease signing, pursue expansion-capacity opportunities, and fund cash SG&A through 2028.
Mir said market conditions remained sufficient for project-level high-yield debt financing, though investment-grade customer commitments or credit wraps remain important to obtaining more efficient financing. Keel expects to assess additional capital needs after lease agreements are signed, when it believes its cost of capital could decline.
Data center projects advance permitting and construction
Gagnon said Keel advanced permitting at all three priority sites and is negotiating with multiple prospective tenants, including hyperscalers, AI companies, GPU cloud providers and large enterprises. He said commercial interest across the portfolio exceeds the company’s available capacity to lease.
At Moses Lake, Keel expects vertical permitting to be completed later in the quarter. The company has removed the former Bitcoin mine, begun preparing the site for Vertiv modules, received the first modules and secured critical long-lead equipment. Keel expects Moses Lake to be its first fully commissioned and energized data center in 2027.
Gagnon said Moses Lake could use modified-gross lease structures, rather than triple-net agreements, to accommodate customers seeking a fully operated facility and faster deployment. The company has given up an option for an additional 10 megawatts at the site and is focusing on 18 megawatts there, he said.
At Sharon, Keel secured full zoning in April and land-development approval during the second quarter. Final environmental permits have been submitted, with a few remaining before the site is fully cleared. The company is considering design changes intended to consolidate computing capacity into what Gagnon described as a simpler and potentially stronger build. Discussions at Sharon have focused on triple-net leases paired with investment-grade credit support for high-growth AI customers.
At Panther Creek, Keel has secured zoning and conditional land-development approval for a campus with 350 megawatts of utility capacity from PPL. The company is pursuing potential expansion capacity to 500 megawatts or more. Its remaining environmental permits are in the final stages, though Gagnon said the regulatory process is taking several months longer than originally anticipated.
He said the permitting timing does not alter the planned power-delivery schedule under the site’s energy services agreement, the anticipated project economics, or its earliest ready-for-service date of 2027. Keel continues to expect the Pennsylvania sites to come online near the end of 2027, while Moses Lake is expected to be the first site online next year despite a delay of a couple of months from earlier guidance.
Expansion pipeline and Sherbrooke opportunity
Keel is working with utility partners on applications for nearly 2 gigawatts of potential expansion capacity across Pennsylvania. Gagnon said the company is increasingly confident it can convert part of that pipeline into signed energy services agreements delivering energized HPC capacity through 2030, with a fuller update potentially available in December or January.
The Scrubgrass project remains in the energy-application stage. Keel is conducting a detailed load study for 750 megawatts and pursuing plans for up to 550 megawatts of on-site generation using combined-cycle gas turbines through an independent power producer. The company has not yet submitted data-center permits for Scrubgrass because it is focused first on securing power and finalizing a campus layout.
In Quebec, Keel secured local approvals in Sherbrooke from the city and local utility, leaving provincial approval outstanding. If approved, the company plans to consolidate three legacy Bitcoin mining power purchase agreements into a single 96-megawatt agreement for an HPC and AI data center.
Gagnon said Quebec’s data sovereignty policies and difficulty in obtaining new data-center energy capacity could support demand for the project, although he noted that growing large-scale power capacity in Canada remains more difficult than at a Pennsylvania campus.
About Bitfarms (NASDAQ:BITF)
Bitfarms Ltd. is a publicly traded, vertically integrated Bitcoin mining company listed on the NASDAQ under the ticker BITF. The company engages in the large-scale operation of cryptocurrency mining farms, leveraging specialized computing hardware to validate and secure the Bitcoin blockchain. By converting electrical energy into computing power, Bitfarms plays a critical role in processing transactions on the Bitcoin network and earning mining rewards.
Bitfarms operates data centers in several jurisdictions with access to low-cost, primarily renewable energy sources.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
Continue following MarketBeat
Add MarketBeat as your preferred source on Google to see our latest stories in your feed.
Before you consider Bitfarms, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Bitfarms wasn't on the list.
While Bitfarms currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
Click the link to see MarketBeat's list of seven stocks and why their long-term outlooks are very promising.
Get This Free Report
