Google partners with Bitcoin miner TeraWulf in a substantial $3.7 billion AI infrastructure agreement

In a significant move, Bitcoin miner TeraWulf has entered into a 10-year colocation agreement with AI platform Fluidstack. This deal, valued at $3.7 billion, marks a strategic shift for TeraWulf as they diversify into AI and high-performance computing.

The key backer behind this agreement is Alphabet, Google's parent company, which has become the largest shareholder in TeraWulf with a 14% stake. Alphabet has also provided a financial commitment of $3.2 billion for a 10-year lease contract with Fluidstack. As part of the deal, Google will backstop $1.8 billion of Fluidstack's obligations and receive warrants for approximately 41 million TeraWulf shares.

The agreement demonstrates how Bitcoin miners are leveraging existing infrastructure and energy expertise to tap into AI's explosive growth. TeraWulf will deliver over 200 MW of computing capacity at its Lake Mariner facility in New York, specifically for liquid-cooled AI workloads. This emphasis on energy-efficient AI computing is indicative of TeraWulf's commitment to sustainable practices.

Google's partnership provides financial backing for TeraWulf's infrastructure buildout, with the company investing $8-10 million per MW. The first 40 MW of the computing capacity is expected to be online by mid-2026, with full deployment by the end of the year.

The deal has had a positive impact on TeraWulf's shares, with WULF shares surging following the announcement. They settled around $8.71, up 59.52% for the day. This surge has also put WULF shares back in positive territory for 2025.

Despite a reported $61.4 million net loss in Q1, TeraWulf returned to profitability in Q2. The company expects 85% net operating income margins on the AI hosting business, translating to approximately $315 million annually. This shift towards AI hosting is expected to provide TeraWulf with more stable, long-term revenue streams, allowing the company to maintain its focus on zero-carbon energy.

The deal does not include any advertisements and brings TeraWulf's market cap to $3.41 billion. It's clear that this strategic partnership is a significant step for TeraWulf as they navigate the evolving landscape of energy, technology, and sustainability.

Google partners with Bitcoin miner TeraWulf in a substantial $3.7 billion AI infrastructure agreement