A maker of AI and high-performance computing infrastructure, WhiteFiber runs data centers and GPU cloud services that companies rent to train and run generative AI models. It grew out of crypto miner Bit Digital, which bought Montreal's Enovum Data Centers, renamed the business WhiteFiber in early 2025, and spun it off in an IPO that August. A fun twist: Enovum's founders had earlier built a web-hosting firm and the blockchain company Bitfarms.
WhiteFiber's largest customer is exiting, but a new $865M colocation deal is set to begin billing next quarter.
The Initial Customer that drove most of last year's is negotiating an exit, and the company wrote off $5.0M in software. Revenue still rose 55% to $28.8M and swung to $85.9M, but the net loss widened to $15.0M. The company's future now rests on the Nscale contract, which is expected to start billing in Q3 2026.
Key takeaways
The 'Initial Customer' that accounted for 70.7% of 2025 is negotiating an early termination of its cloud services agreement, with discussions covering a non-refundable prepayment, a service deposit, and a potential 40% early termination fee.
rose 55% to $28.8M, driven by a 44% increase in cloud services to $23.8M from higher GPU server deployments and $4.7M in colocation revenue as the MTL-3 facility began billing Cerebras.
A $5.0M was recorded after the company discontinued its internally-developed software platform, contributing to a net loss of $15.0M, compared to a net loss of $8.8M a year ago.
swung to $85.9M from negative $3.9M a year ago, primarily due to a large increase in and customer deposits.
The 10-year Nscale colocation agreement at the NC-1 facility, representing approximately $865M in total contracted , is now expected to begin billing in Q3 2026, a shift from the prior Q2 2026 target.
Cash and equivalents fell to $56.1M from $114.4M at year-end, and the company reported a of $28.6M due to near-term debt maturities, despite holding $89.1M in net proceeds from January 2026 convertible notes.
What changed
The Initial Customer's status moved from a 'pause' to active negotiation of an early termination, with specific terms now under discussion, including a potential 40% termination fee.
The expected billing start for the Nscale contract at NC-1 slipped from Q2 2026 to Q3 2026.
The company recorded a $5.0M for discontinuing its internal software platform, a new charge not flagged in prior periods.
What to watch
Whether the Initial Customer termination is finalized, the amount of any termination fee collected, and how quickly the freed GPUs are redeployed to other customers.
Whether the Nscale contract at NC-1 begins billing in Q3 2026 as now expected and at what initial run rate.
The trajectory of general and administrative expenses, particularly and professional fees, relative to the $28.8M quarterly base.
Section summaries
Management's Discussion and Analysis
Revenue rose 55% to $28.8M driven by cloud GPU deployments and new colocation site MTL-3, while net loss widened to $15.0M on higher costs and a $5.0M software impairment.
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Total increased 55% to $28.8M, with cloud services up 44% to $23.8M on higher GPU server deployments and colocation up to $4.7M as the MTL-3 facility began billing Cerebras.
turned sharply positive to $85.9M, a reversal from the negative $3.9M in the same quarter last year and negative $16.9M in Q3 2025, driven by a large inflow from and customer deposits.
The pace of cash burn against the $56.1M cash balance, given the and ongoing data center investments.
Cost of rose 63% to $11.7M, driven by a $1.9M increase in GPU server lease expenses and higher electricity costs at the newly operational MTL-3 colocation site.
A $5.0M was recorded after the Company discontinued its internally-developed software platform, contributing to a $10.3M increase in total operating expenses.
The Company entered a 10-year colocation agreement with Nscale at its NC-1 facility representing ~$865M in total contracted , with billing expected to begin in Q3 2026.
Liquidity was supported by $56.1M in cash and $89.1M in , though the Company reported a of $28.6M due to near-term debt maturities.
was $5.5M for the quarter, up from $3.3M a year ago, after adding back , interest, taxes, the software , and .
From time to time, we may become involved in various disputes and litigation matters that arise in the ordinary course of business. We are not presently a party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or taken togethe…
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From time to time, we may become involved in various disputes and litigation matters that arise in the ordinary course of business. We are not presently a party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or taken together have a material adverse effect on our business, results of operations, cash flows or financial condition. For more information, refer to Note 18. Commitments and Contingencies in our Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere herein.
In addition to the information set forth in this Quarterly Report on Form 10-Q, including the information set forth in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” as well as in our condensed consolidated financial statements and the re…
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In addition to the information set forth in this Quarterly Report on Form 10-Q, including the information set forth in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” as well as in our condensed consolidated financial statements and the related notes, you should carefully consider the risk factors disclosed in the section entitled “Risk Factors” in our Annual Report and the other reports that we have filed with the SEC. Any of the risks discussed in such reports, as well as additional risks and uncertainties not currently known to us or that we currently deem immaterial, could materially and adversely affect our results of operations, financial condition or prospects. During the period covered by this Quarterly Report on Form 10-Q, there have been no material changes in our risk factors as previously disclosed: