TeraWulf Signs $19 Billion AI Lease with Anthropic

What happened

TeraWulf signed a 20-year lease with Anthropic covering the Justified Data campus in Hawesville, Kentucky. The agreement involves developing an AI infrastructure site designed to support approximately 401 megawatts of critical IT capacity, with construction planned in multiple phases. The first phase is expected to become operational during the second half of 2027, and the full site is scheduled to reach capacity by early 2028. The lease is backed by investment-grade credit quality and is expected to generate approximately $19 billion in contracted revenue over the initial term, with an average annual yield of $2.4 million per IT megawatt. The contract includes two five-year renewal options. In a separate transaction, TeraWulf agreed to sell its 50.1% ownership stake in the Abernathy Joint Venture to an investor consortium led by Fluidstack for $530 million, representing about an 18% return on its original $450 million equity investment. The Abernathy Joint Venture was established in 2025 to develop a 168-megawatt AI data center campus in Abernathy, Texas. Payment will arrive in three installments: $250 million within 14 days of signing, $150 million by the end of 2026, and approximately $130 million by April 30, 2027.

Why it matters

This agreement marks a significant strategic shift for TeraWulf, a company that began as a Bitcoin miner and has been diversifying into AI and high-performance computing infrastructure. The 20-year lease provides a long-duration, predictable revenue stream backed by investment-grade credit, fundamentally different from the volatile, hashrate-dependent revenue typical of cryptocurrency mining. The $19 billion contracted revenue figure exceeds TeraWulf's current market capitalization and represents stronger economics than some analysts had modeled. With this deal, TeraWulf's AI order book now totals approximately $27 billion in contracted revenue across roughly 839 megawatts of IT load. The sale of the Abernathy stake unlocks capital that can be reinvested into infrastructure assets where TeraWulf retains direct ownership, customer relationships, and operational control, allowing the company to capture the full margin profile rather than holding a minority stake in a joint venture.

Bigger picture

TeraWulf is part of a broader industry trend of former cryptocurrency miners, sometimes called neoclouds, transitioning their technical expertise and infrastructure investments toward serving AI developers. Other companies following similar paths include CoreWeave, Nscale, IREN, and Crusoe. These operators can more easily transition server racks optimized for mining cryptocurrency to AI training and inference tasks, making them attractive partners for AI labs seeking custom data center capacity. Major AI developers have announced multi-billion-dollar deals with neoclouds, as these operators are often more nimble than traditional hyperscalers and more willing to develop custom data centers for a single client. Anthropic itself has locked up approximately 3.5 gigawatts of AI compute capacity across multiple deals, including a $50 billion agreement with Fluidstack announced in November. The shift reflects high demand and limited supply in AI infrastructure, with AI developers increasingly competing for available power capacity and compute resources. The 20-year length of TeraWulf's agreement is notably longer than the 10 to 15-year base contracts most diversifying Bitcoin miners have been signing.

What to watch

Key milestones include the first phase of the Kentucky campus coming online in the second half of 2027 and the full site reaching capacity by early 2028. Investors should monitor whether TeraWulf successfully secures financing for the estimated $3.2 billion to $4 billion in capital expenditures required to build out the 401-megawatt facility, as this will determine whether the deal creates or destroys equity value. The payment schedule for the Abernathy sale provides near-term cash inflows: $250 million shortly after signing, $150 million by end of 2026, and approximately $130 million by April 2027. How TeraWulf redeploys this capital into fully owned AI infrastructure will signal its strategic priorities. Broader industry trends to watch include whether other Bitcoin miners continue shifting toward AI infrastructure and whether the growing number of neocloud deals creates pricing pressure or capacity constraints in the power and data center construction markets.