Keel Infrastructure (Bitfarms) Maps High‑Risk Pivot Path
Bitfarms Ltd. ((TSE:KEEL)) has held its Q1 earnings call. Read on for the main highlights of the call.
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Bitfarms’ latest earnings call painted a picture of a company in the midst of a high‑stakes transformation, balancing solid strategic progress with sharp near‑term financial pain. Management stressed that Keel Infrastructure, the new name after redomiciling to the U.S., is well funded and positioned for the AI and high‑performance computing build‑out, but investors will need patience as losses mount and value hinges on signing key leases.
Corporate Transformation Completed
Keel Infrastructure has effectively closed the book on its past life as a Bitcoin miner, completing a multiyear pivot to North American digital infrastructure. The company redomiciled to the United States, rebranded from Bitfarms, and sold its Paso Pe site, signaling a strategic reset toward hosting high‑performance computing and AI workloads.
Strong Liquidity Position
Despite current losses, Keel emphasized a robust liquidity cushion of about $533 million in cash and Bitcoin as of early May 2026. The sale of Paso Pe brought forward two to three years of expected cash flow, while selling 269 BTC for $20 million helped de‑risk the balance sheet and fund its infrastructure ambitions.
Secured Power and Site Portfolio
The company highlighted a sizeable secured power footprint that underpins its new strategy. Panther Creek anchors the portfolio with roughly 350 MW under contract, potentially rising toward 400–430 MW and even above 500 MW long term, while Sharon adds 110 MW and Moses Lake offers 18 MW with an option for another 10 MW.
Permitting and Development Progress
Zoning work at the three priority sites is largely done, reducing one of the major early‑stage risks for new data center builds. Panther Creek zoning wrapped in February, Sharon has full zoning and preliminary land approvals, and management said land development and environmental permits are tracking toward mid‑ to late‑summer milestones.
Commercialization Momentum and Clear Targets
Keel is already in active discussions with potential customers, citing strong inbound interest for capacity at Panther Creek, Sharon, and Moses Lake. The company has set a clear commercialization goal of signing three leases by the end of 2026, one at each site, positioning the business to begin generating infrastructure revenue in 2027.
Strategic Delivery Partners and Future‑Proofing
To execute at scale and meet fast‑changing AI requirements, Keel has assembled an ecosystem of well‑known partners. Firms like Turner Construction, Corgan, Vertiv, and T5 are working in parallel on engineering and architecture so that the sites can support emerging high‑density deployments, including future Vera Rubin‑type computing workloads.
Moses Lake Acceleration
Moses Lake stands out as an early mover within the portfolio thanks to pre‑purchased equipment. Keel has already secured modular data center units and other long‑lead items for the site, giving it the critical pieces needed to accelerate deployment and reach ready‑for‑service status faster than traditional stick‑built projects.
Pipeline Upside at Scrubgrass and Sherbrooke
Beyond the near‑term trio, the company sees significant optionality in its broader development pipeline. At Scrubgrass, a detailed load study for up to 750 MW is underway and could more than double secured capacity, while Sherbrooke is being consolidated into a single 96 MW campus in partnership with local authorities.
Revenue Decline
The financial snapshot for the quarter reflects the cost of transition away from pure Bitcoin mining. Revenue in the first quarter of 2026 fell to $37 million, a 23 percent year‑over‑year decline, underscoring how the legacy mining business is shrinking faster than new infrastructure revenues can ramp.
Large Operating and Net Losses
Losses widened significantly as Keel invests ahead of anticipated demand for AI and HPC capacity. The company reported a $98 million operating loss versus $35 million a year earlier, while loss from continuing operations ballooned to $128 million, or $0.21 per share, compared with $0.08 per share in the prior‑year quarter.
Negative Adjusted EBITDA
Profitability metrics also moved sharply into the red as the business model transitions. Adjusted EBITDA swung from a positive $7 million in the prior year to a negative $17 million, reflecting lower revenue, higher operating costs, and the early stages of building a new infrastructure platform.
Increased Noncash and One‑Time Charges
Noncash and one‑off items added further pressure to reported results. Depreciation rose to $28 million from $18 million, while a $41 million loss on the change in fair value of digital assets and a $22 million loss on extinguishing a credit facility weighed on the bottom line relative to the prior year.
Rising Operating Costs
Operating expenses are climbing as Keel invests in energy, infrastructure, and people to support its reoriented strategy. Energy and infrastructure costs alone were up by about $15 million year over year, contributing materially to the deterioration in adjusted EBITDA and underscoring the capital‑intensive nature of the new model.
Bitcoin Decommissioning and Reduced Mining Activity
The company’s Bitcoin mining engine is being gradually wound down to free up power and focus for data center development. Hash rate stood at around 14 exahash but is expected to decline toward 5 exahash by year‑end, meaning related cash flows will “trickle down” during the transition period.
Execution Risks Still Present
Management acknowledged that the key value catalyst—signed leases on its major sites—has yet to materialize. Permitting remains in progress, and leadership flagged internal bandwidth as a constraint as the team works to execute a roughly 2 gigawatt development pipeline, leaving meaningful execution risk on the path to commercialization.
Higher Run‑Rate SG&A
To build out its HPC and AI capabilities, Keel is accepting a structurally higher cost base. The company expects cash SG&A to settle around $25 million per quarter, or about $100 million a year, as it hires specialized talent, raising the bar for the level of utilization and pricing needed to deliver attractive returns.
Forward‑Looking Guidance and Outlook
Looking ahead, Keel’s roadmap centers on converting its strong balance sheet and power portfolio into contracted revenue. Management aims to sign three major leases by the end of 2026, bring sites ready for service in 2027, and tap non‑recourse project financing thereafter, arguing that its roughly $533 million in liquidity is sufficient to fund lease execution, initial construction, and corporate overhead through 2028.
Keel Infrastructure’s latest call showcased a company burning cash today to secure a foothold in tomorrow’s digital infrastructure market. Investors heard a balanced message: solid progress on strategy, permitting, and partnerships, offset by shrinking Bitcoin revenue, deepening losses, and real execution risk until leases are signed and megawatts are delivering revenue.
