HIVE's BUZZ HPC signs $350 million GPU cloud deal, targeting $200 million ARR by year-end
Key Takeaways
- •BUZZ HPC signed a five-year GPU cloud services contract valued at about $350 million with an unnamed investment-grade customer.
- •The agreement is expected to add roughly $70 million in annualized recurring revenue and raise BUZZ HPC’s total ARR to about $180 million.
- •The contract includes deployment of 2,016 NVIDIA Blackwell Ultra GPUs at Bell AI Fabric in Merritt, British Columbia.
- •HIVE expects the hardware to go live in the fourth quarter and increase HPC revenues to about $500,000 per day.
- •The cluster and related hardware are expected to cost about $185 million, funded through a customer deposit, a June 2026 zero-percent convertible bond and equipment financing.
HIVE Digital Technologies said Monday that its subsidiary BUZZ HPC has signed a five-year agreement worth approximately $350 million to provide GPU cloud computing services to an unnamed investment-grade customer. The investment-grade designation signals strong creditworthiness, reducing counterparty risk on a multi-year commitment of this size.
Once the hardware goes live in the fourth quarter, the company expects the deal to drive its high-performance computing revenues to roughly $500,000 per day.
Second major GPU commitment since June
The agreement adds about $70 million in annualized recurring revenue, lifting BUZZ HPC's total annualized revenue to approximately $180 million. Of that figure, about $35 million is realized today, while the remaining $145 million is under contract and scheduled to become operational through the end of 2026.
It marks the second major GPU commitment HIVE has announced since June. At the same site, BUZZ HPC's prior three-year, $220 million sovereign AI cloud deal deploys NVIDIA Grace Blackwell systems for Bell and Cohere.
"We are pleased to announce this agreement as we accelerate towards our year-end target of $200 million of ARR for our GPU cloud business," Chief Executive Aydin Kilic said.
The new contract narrows the gap to that target to roughly $20 million, with conversion of the remaining contracted revenue tied to deployment schedules through the end of 2026.
2,016 Blackwell Ultra GPUs bound for Bell AI Fabric
Under the contract, BUZZ HPC will deploy a dedicated cluster of 2,016 NVIDIA Blackwell Ultra GPUs, housed in Quantum-X800 InfiniBand-networked GB300 NVL72 rack-scale systems with VAST Data storage. HIVE said the design is based on NVIDIA's reference architecture and supports large-scale AI training and inference for enterprise customers.
The cluster is on its way to the Bell AI Fabric site in Merritt, British Columbia. Bell AI Fabric is the Canadian telecom carrier's project to expand AI compute capacity across the country. According to HIVE, the site is powered 100% by renewable hydroelectric energy and uses closed-loop liquid cooling that does not continually use water. Renewable power and water-free cooling have become key siting criteria as AI data centers' energy and cooling demands grow. The company plans to roll out the system later this year.
$185 million capital expenditure
Capital expenditure for the cluster and related hardware and warranties is about $185 million. HIVE said it will fund the build in three ways: an upfront customer deposit of roughly $35 million, equal to 10% of the contract value; proceeds from its June 2026 zero-percent convertible bond; and equipment financing.
At the end of the term, HIVE still owns the infrastructure, a structure Kilic frames as a return play. The company is "using debt financing to lever the purchase of the GPUs to provide a very strong internal rate of return," he said.
Executive Chairman Frank Holmes cited approximately 400 megawatts of Canadian capacity and the opportunity to bring more than 120,000 GPUs online over two years.
Bitcoin miners expand into AI infrastructure
The deal follows a series of large AI cloud and data center agreements involving bitcoin miners. IREN struck a $9.7 billion cloud deal with Microsoft, Hut 8 signed a $7 billion data center lease linked to an Anthropic and Fluidstack partnership, and TeraWulf has joined a $9.5 billion Google-backed venture with Fluidstack. The pivot has accelerated since bitcoin's April 2024 halving cut mining rewards from 6.25 to 3.125 BTC per block, compressing mining margins, while the powered land, electrical capacity, and cooling infrastructure that miners already control match what AI data centers require.
HIVE stock closed up 4% on Friday and traded roughly 8% higher in Monday's pre-market. In its most recent quarter, the company reported $79.1 million in revenue, including $7.1 million from BUZZ HPC. Its contracted GPU cloud ARR has reached approximately $110 million.
In February, Cryptopolitan reported that the subsidiary had signed approximately $30 million in two-year AI cloud contracts, anchored by an initial 504-GPU deployment in Manitoba, with HPC segment revenue expected to climb from about $20 million to $35 million.
