HIVE Digital Technologies’ Q1 Earnings Report: AI Ambitions Beyond Bitcoin Mining

HIVE Digital Technologies (NASDAQ:HIVE) has released its fiscal first-quarter 2027 earnings report, showcasing significant growth in revenue and gross operating margin. The company’s revenue reached $79.1 million, a 73% increase from the $45.6 million recorded in the same period last year.

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HIVE’s revenue growth can be attributed to its expansion of Bitcoin mining operations and the continued development of its high-performance computing (HPC) and artificial intelligence (AI) infrastructure business. The company’s gross operating margin rose to $24.2 million from $15.8 million in the year-earlier period, representing a 53% increase.

Bitcoin Mining Remains HIVE’s Largest Business

Bitcoin mining accounted for the majority of HIVE’s revenue, generating $72.1 million in the quarter. HPC and AI operations, on the other hand, contributed approximately $7 million to the company’s revenue.

HIVE’s adjusted EBITDA was $13.4 million, compared to a negative adjusted EBITDA of $9 million in the prior quarter. The company produced approximately 1,004 Bitcoin equivalent during the quarter and held 190 Bitcoin in treasury at the end of June.

Expansion of GPU Cloud Business

HIVE has reached $180 million in active and contracted annualized revenue from its GPU cloud business. The company has also announced a new five-year GPU cloud agreement with an unnamed investment-grade global technology company, worth a total contract value of $360 million.

The agreement calls for 2,088 NVIDIA GB300 GPUs to be deployed at Bell Canada’s Merritt, British Columbia, facility in the fourth quarter. HIVE expects the GPU cluster, including associated infrastructure, to require about $185 million of capital expenditures.

Colocation and Data Center Development Plans

HIVE is also advancing its colocation and data center development plans, including a previously announced letter of intent for an HPC colocation lease at its Boden, Sweden, site. The proposed arrangement would provide approximately $45 million in annualized revenue from 25 megawatts of IT load.

The company is also working on the design of a potential AI data center in Paraguay, with a 200-megawatt substation expected to provide an additional 100 megawatts of IT load. HIVE’s global power footprint totals 860 megawatts, including 440 megawatts of active Tier 1 sites and an additional development pipeline across Canada, Sweden, and Paraguay.

Swedish VAT Dispute Remains Unresolved

HIVE’s fiscal first-quarter results included an $84.7 million non-cash provision related to a long-running dispute with Swedish tax authorities over VAT treatment for ASIC imports used in its Bitcoin mining business. The company is contesting the tax assessment and does not plan to pay it.

HIVE’s management team expects the company to continue operating its Bitcoin mining business while deploying capital toward GPU cloud and colocation opportunities. Bitcoin mining currently generates about $750,000 in daily revenue, while HPC operations generate about $97,000 daily.

Looking Ahead

HIVE’s President and CEO, Aydin Kilic, said, ‘We’re at critical mass now. We’re still targeting $200 million ARR for the GPU cloud business’ by the end of the fiscal year.

HIVE’s expansion into the GPU cloud business and its development of HPC and AI infrastructure are key areas of focus for the company. With a strong presence in the global data center market, HIVE is well-positioned to capitalize on the growing demand for AI and HPC infrastructure.