Cipher Digital Inc.

Good day and welcome to the fourth quarter and full year 2025 Business Update conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question, please press star 1-1. As a reminder, this call may be recorded. I would like to turn the call over to Courtney Knight, head of investor relations. Please go ahead.

Good morning, and thank you for joining us on this conference call to address Cypher Digital's business update for the fourth quarter and full year 2025. Joining me on the call today are Tyler Page, Chief Executive Officer, and Greg Mumford, Chief Financial Officer. Please note that our press release and presentation can be found on the investor relations section of the company's website, where this conference call will also be simultaneously webcast. Please also note that this conference call is the property of Cypher Digital, and any taping or other reproduction is expressly prohibited without prior consent. Before we start, I'd like to remind you that the following discussion, as well as our press release and presentation, contain forward-looking statements. These statements include, but are not limited to, Cypher's financial outlook, business plans and objectives, and other future events and developments, including statements about the market potential of our business operations, potential competition, and our goals and strategies. Forward-looking statements and risks in this conference call, including responses to your questions, are based on current expectations as of today. and CIFR assumes no obligation to update or revise them, whether as a result of new developments or otherwise, except as required by law. Additionally, the following discussion may contain non-GAAP financial measures. We may use non-GAAP measures to describe the way in which we manage and operate our business. We reconcile non-GAAP measures to the most directly comparable GAAP measures, and you are encouraged to examine those reconciliations, which are filed at the end of our earnings release issued earlier this morning. I will now turn the call over to our CEO, Tyler Page.

Tyler? Thanks, Courtney. Good morning, everyone, and thank you for joining us today. I'm Tyler Page, CEO of Cypher Digital, and I'm pleased to welcome you to our fourth quarter and full year 2025 business update call. 2025 was a defining year for Cypher. Over the past 12 months, we completed a deliberate and disciplined transformation of the company. From a Bitcoin miner with sourcing and development expertise into a digital infrastructure company purpose-built to deliver hyperscale compute. During the year, we secured long-term leases with world-class hyperscalers, executed large-scale project financing, and advanced the development and construction of multiple data center projects. We also took decisive steps to simplify the business and focus our capital, our team, and our future squarely on high-performance computing. Today's call reflects that evolution. We're proud to announce today that we are formally rebranding the company as Cipher Digital. This rebrand reflects what the business has become. This is not an aspirational shift, but a recognition of the work already done and the work we will continue to do. This rebrand represents far more than a new name or visual identity. It marks a complete transition to a business centered on stable, long-duration cash flows and long-term leases with best-in-class hyperscalers. Today's Cypher is a developer of next-generation digital infrastructure, purpose-built to deliver power-dense, large-scale facilities to exacting hyperscaler specifications. While Bitcoin mining played a foundational role in building our power expertise and development capabilities, our identity today is centered on powering next-generation compute at scale. Therefore, we are taking steps to simplify the company and reallocate capital away from non-core activities, which I will discuss in further depth later on the call. In addition, we are deepening our bench across construction, engineering, operations, and corporate leadership to ensure our organization is fully aligned with this next chapter. The Cipher Digital brand captures who we are today. a company focused on disciplined execution, precision at pace, and performance proven through delivery. Importantly, this evolution is not a reinvention. It is a natural extension of what we already do exceptionally well, large-scale, energy-intensive infrastructure delivered with speed to market, disciplined capital allocation, and operational rigors. The same capabilities that built our platform are precisely what hyperscalers require today. So when we say we are built for hyperscale, we mean more than just building for hyperscalers. We mean that looking forward, Cypher Digital itself is built for hyperscale. We have built a spectacular foundation for growth at speed in our evolving world. This strategic evolution is the direct result of our team's disciplined execution over the past six months. Slide five shows just how manic the pace of leasing and financing has been over the last six months. Each sequential step on our path has strengthened our relationships, enhanced our credibility, and positioned us for what comes next. We believed and have now proven that our first lease at Barber Lake was just the beginning. and have since signed a second lease at Black Pearl and a Barber Lake lease upsize. As important as our success on the leasing side has been, equally valuable has been our transformational capital raising. Most recently, we completed a pioneering and highly successful bond offering for $2 billion. This offering was met with exceptional investor demand, which allowed us to price it at a yield one full percent lower than our previous bond offering at 6.125 percent, a clear validation of our strategy and a vote of confidence from conservative bond investors in our ability to execute. This issuance secured all the remaining CapEx needed for the build-out of Black Pearl, and it included a reimbursement of approximately $233 million to CIFR for our prior equity contributions to the site. Greg will elaborate on all of our financings in his remarks. and provide more detail on how we think about financing our growth going forward. While we build data centers, sign new leases, and complete financings, our outstanding origination team still keeps coming to work every day. In addition to all of our other activity this quarter, we acquired Ulysses, a 200 megawatt site in Ohio with all necessary interconnection approvals to participate in the PJM market. The site is expected to energize in 2027, marks Cypher's first acquisition in PJM, and is well suited for HPC applications. The Ulysses campus takes its name from Ohio native Ulysses S. Grant, a leader defined by operational discipline, moving the right resources to the right place on time through any conditions. That's the mindset behind our hopes for the future of this site and others in our pipeline. power forward data center campuses engineered for reliability today and adaptability tomorrow with modular designs that can absorb multiple upgrade cycles as compute technology evolves. As I discussed earlier, and as demonstrated by our incredible quarter of momentum, Cypher's rebrand reflects more than a change in name. It marks a fundamental evolution in our business model. We are now squarely focused on securing durable, long-term cash flows through contracted leases with the world's leading hyperscalers. This model prioritizes visibility, stability, and scale. To date, we've executed two data center campus leases representing 600 megawatts of gross capacity and approximately $9.3 billion in contracted revenue. These agreements carry initial terms of 10 to 15 years with multiple extension options and translate to approximately $669 million of average annualized NOI over the next 10 years. Our 3.4 gigawatt pipeline, combined with a best-in-class team, positions us to continue to execute on this new business model by securing additional leases across sites. Slipher's future trajectory on slide seven speaks for itself. Beginning this year, our initial leases commence with rent payments. And from there, you can see a clear and steady ramp in cash flow as additional capacity comes online. Our leases create visible, non-volatile contractual growth over the balance of the decade. Based solely on the contracts currently executed, we expect our leases to generate $669 million of average annualized net operating income from October 2026 to September 2036. By 2035, we project approximately $754 million in annual net operating income. What's important here is not just the magnitude of growth, but the predictability. These are contracted revenues tied to mission critical infrastructure with multi-year lease terms and extension options. That level of visibility fundamentally changes the entire profile of this company. Demand for power dense hyperscale infrastructure continues to outpace supply, and we are confident in our ability to execute additional leases for our pipeline sites, positioning us to extend this trajectory much further. We are proud of the foundation we built in Bitcoin mining, which shaped our capabilities. But as we look ahead, our direction is clear. We are building a business defined by durable, stable, long-term contracted cash flows. Therefore, we are taking steps to reposition the company away from Bitcoin mining as we continue to transition towards a pure play digital infrastructure platform. With that focus in mind, last week we sold our three 40-megawatt joint venture sites Alvors, Bear, and Chief, where we held 49% interests. Our interests in the sites were acquired in an all-stock transaction by Canaan, a highly reputable manufacturer of industry-leading Bitcoin miners. Given our desire for no further capital investment into Bitcoin mining, and given Canaan's role as the supplier of mining rigs to the JD sites, Canaan is the most natural buyer to acquire our equity interest. In Bitcoin mining, vertical integration of rig manufacturer and site operator is the way of the future. We believe Canaan's unmatched machine quality, vertical integration, technology leadership, and expanding energy platform make them the right steward for the next phase of growth at the Albor's bear and chief sites. By receiving Canaan equity in this transaction, we retain exposure to the potential upside of Bitcoin mining through a fully vertically integrated platform. We see significant opportunity ahead for Canaan, who has consistently delivered the best performing rigs in our fleet. We also know the team well and have strong conviction in their ability to execute, scale the platform, and drive sustained growth and improved valuation over time. This transaction allows us to simplify our structure, accelerate our strategic transition, and maintain optimized exposure to the industry in a capital light way. Given our pivot away from Bitcoin mining going forward, it makes less sense to manage a Bitcoin inventory as part of our corporate strategy. In the fourth quarter, with higher Bitcoin prices, we liquidated a substantial portion of our treasury to reinvest in the growth of the HPC hosting business. Due to recent Bitcoin price action, we have been much less aggressive in our selling, but we'll continue to manage the sale of the remaining Bitcoin in inventory over the course of the next year. As of February 20th, we held approximately 1,166 Bitcoin. We plan to opportunistically reduce that position over time and reinvest the proceeds into the HPC hosting business, likely exiting entirely by the end of 2026 as we redeploy capital into contracted infrastructure opportunities. All Bitcoin mining rigs from Black Pearl have been sold, marked for sale, or redeployed to our last remaining Bitcoin mining site at Odessa. Following the sale of our JVs and the retrofit at Black Pearl, our hash rate will be approximately 11.6 ETH per second going forward, driven by our Odessa site. At Odessa, we continue to benefit from our unique fixed price PPA, which has positioned us among the lowest cost producers of Bitcoin in the industry. We are proud of the site's performance and expect it to continue generating meaningful cash flow as our data center leases ramp. We maintain the flexibility to continue mining at Odessa through the expiration of the PPA in July 2027, while continuing to evaluate a potential conversion of the site to support HPC workloads. Let's now turn to a review of our current portfolio. Slide 10 provides a high level transaction overview of our lease at Barber Lake, highlighting contracted megawatts and the key economic terms across our first lease. Now that a lease is signed and we've secured financing for the project, the next phase of value creation at Barber Lake is driven by disciplined construction, on-time delivery, and converting contracted capacity into cash flows. Construction at the site is well underway. Concrete foundations have been poured, structural steel is going vertical, interior mechanical, electrical, and plumbing work has commenced, and utility work continues to progress. All current design milestones have been achieved and we have received consistently positive tenant feedback and important validation as we continue toward full build out. We have secured approximately 95% of long lead equipment with delivery schedules aligned to support our completion targets. Additionally, we have secured 100% of the necessary workforce across all critical construction work streams through the duration of the project. On any given workday, there are over 400 personnel onsite driving progress safely and efficiently. Importantly, the project remains on schedule and is tracking to meet both early access and substantial completion milestones under our contractual timelines. This is where our execution culture truly differentiates us, translating signed leases into delivered infrastructure on time and on budget. We will continue to update the market as we hit key milestones, but we are very pleased with the progress to date. Slide 12 provides a high-level transaction overview of the key economic terms of our triple net lease with AWS at Black Pearl. Similar to Barber Lake, now that the lease is signed and financing is completed, we are squarely focused on delivery. At Black Pearl, data center development is on track with engineering, procurement, and construction activities underway. The transition of the site is progressing as planned with Bitcoin mining decommissioning being completed this week. Importantly, approximately 85% of the infrastructure currently deployed at Black Pearl is expected to be repurposed for the AWS lease. This reuse of existing infrastructure meaningfully reduces execution risk, improves capital efficiency, and accelerates our path to delivery. Overall, Black Pearl reflects the same disciplined execution framework we are applying across the portfolio, locking in supply chain visibility early and advancing toward on-time, on-budget delivery. Turning to slide 14, Odessa is our last operating Bitcoin mining site. As a reminder, Odessa's fixed price power purchase agreement at approximately 2.8 cents per kilowatt hour continues to position Cypher among the lowest cost Bitcoin producers in the industry. This structural cost advantage combined with disciplined operations enables us to generate meaningful cash flow moving forward should we elect to continue mining through the expiration of the PPA in July 2027. Today, we are operating 207 megawatts of capacity, supporting approximately 11.6 exahash per second of hash rate. Bleed efficiency remains strong at approximately 17.2 joules per terahash. Let's now shift to an update on our development portfolio. Given the recent headlines surrounding ERCOT, we want to take a moment to provide our perspective and address any implications for our development pipeline. We'll also highlight several sites where we have the highest degree of confidence in securing interconnection approvals based on our ongoing dialogue with ERCOT and the relevant transmission and distribution service providers. This past quarter, we strengthened our regulatory expertise by hiring Lee Bratcher as head of policy and government affairs. Lee brings to Cipher extensive industry experience, a deep understanding of the Texas and federal energy regulatory landscape, and strong relationships across ERCOT and the TDSPs. With his extensive understanding of ERCOT's processes and evolving rulemaking, we have a great degree of confidence in our ability to navigate this environment effectively. As a reminder, Stifer welcomes all legislative efforts to clean up the lengthening interconnect queue. And we have been consistent that any new rules requiring posting of deposits and acceleration of serious developers is a good thing for us. The recent developments represent a positive step forward for the data center industry in Texas. Earlier this month, ERCOT discussed the potential implementation of a batch study process and that the existing development and stakeholder process is expected to last until June 2026. While the final batch process remains to be determined, we believe we have made enough significant progress at certain development sites to be included in early batches with firm loads. We expect these sites to remain on track for the energizations we have previously communicated. Specifically, the sites on slide 16 are either already interconnection approved or in the final stages of the current approval process. At the top of the slide is Stingray, our 250 acre campus in Andrews, Texas. The site is fully interconnection approved for 100 megawatts and remains on track to energize in the fourth quarter of this year. Substation development is already underway And with interconnection secured, the load is firm. Given the site's approval status, timeline to power, and quality of location, we are increasingly confident in securing a lease in the near term. This confidence stems from having engaged with a broad range of interested tenants and having now identified a preferred partner with whom we are in advanced lease negotiation. As lease pricing continues to move in our favor alongside growing demand, we expect lease economics here to be among the most favorable we've achieved to date. And while the site has 100 megawatts of gross capacity today, we are actively exploring behind-the-meter solutions to expand capacity over time, not only at this location, but across our broader portfolio and pipeline. Reveille in Cthulhu, Texas, also fully approved for 70 megawatts and remains on track to energize in the third quarter of 2027. We have already initiated substation development. The project falls below the megawatt threshold that would trigger the batch process, and its interconnection is already approved. Ulysses, our recently acquired 200 megawatt site in Ohio, has all necessary approvals to participate in the PJM market, not ERCOT, and is expected to energize in 2027. We are in advanced discussions with potential tenants regarding an HPC lease at that location. Looking to the rest of the pipeline in ERCOT, the McLean site has all studies approved, deposits have been funded with the TDSP, and the land is secured. The site is undergoing the final interconnection approval processes. Based on this information, we expect the energization timeline and capacity of this site to be unaffected by any new batch processes. For each of Mekeska and Colchis, studies have been submitted, all requested deposits have been funded, and the land has been secured. This makes them likely candidates for an early batch as well. We continue to push all remaining workflows forward and fund all deposits as soon as possible to ensure that the energization timelines are preserved and the loads are firm. This slide provides an overview of our current operating and energized capacity as well as outlines our full future pipeline. We are very pleased with the composition of the portfolio today. We also remain confident in both our regulatory positioning and the strength of our roughly 3.4 gigawatt development pipeline, all being prioritized for HPC. Our development pipeline is the result of years of sourcing, permitting and infrastructure work, and it positions us well to serve the increasing demand we are seeing. We believe the value of this pipeline lies not only in megawatts, but in the credibility Cipher brings to those megawatts. both in our ability to sign leases with the best tenants in the world and in our ability to construct and operate data centers. Our conviction has only strengthened since last quarter. We believe that Cypher is among the best positioned companies in the world to seize the near-term opportunities emerging from the growing power shortfall. While we've made significant progress to date, we are still in the early innings. We expect our pipeline to expand, additional leases to be executed, and Cypher Digital to further solidify its position as a global leader in data center development and operations. I'll now turn the call over to our CFO, Greg Mumford, who will walk through our financing activities, capital strategy, and the financial results in more detail.