WhiteFiber, Inc. Ordinary Shares (WYFI) Earnings

Management highlights

First IPO Anniversary and Leadership Update: - White Fiber marked its one-year IPO anniversary, with substantial progress on core strategic goals including execution of large-scale AI infrastructure projects, business transformation, and balance sheet strengthening. - Justin Zhu was appointed as new CFO, with former CFO Eric stepping into a senior advisory and non-voting board observer role to focus on BitDigital, providing dedicated leadership for both growing businesses. NC1 Flagship Project Update: - The 40 megawatts NC1 project has moved into active customer deployment, with 20 megawatts available for customer testing and installation, and initial billing has commenced. All prior delivery and commissioning issues for equipment have been resolved. The full 40 megawatts is expected to reach full run-rate billing by the end of August 2026. - Duke Energy is expected to release a delivery schedule for the next 45 megawatts of capacity in the near term, with existing priority rights for Enskill, and strong inbound interest from other parties for this tranche. Long-term potential exists to add an additional 200 megawatts, bringing the total campus to ~300 gross megawatts, subject to utility approval. Canadian Portfolio Update: - Development at MTL2, which was paused for strategy review, will move forward with a 5 megawatt gross capacity development targeting completion by the end of 2026, supported by active prospective customer discussions. The company is evaluating both traditional co-location and vertically integrated co-location/cloud models for the site. - MTL1 continues stable performance with customer renewals, and a modest expansion is under evaluation. MTL3 (Cerebrus deployment) continues strong performance, and additional utility capacity for expansion is undergoing approval. Cloud Services Transformation: - The business has been restructured to focus on larger, longer-duration contracts, higher capital efficiency, and core competencies of hardware sourcing, complex cluster deployment, and long-term operations. - Since the last earnings call, new multi-year cloud contracts totaling $540 million in aggregate contract value have been signed, with an expected $200 million in annualized revenue once fully deployed. Notable new contracts include Base10 (1,392 NVIDIA B300 GPUs, $165 million contract value, service starting November 2026), Prime Intellect (576 NVIDIA VeriRubin 200 GPUs, $108 million contract value, service starting Q2 2027), and an Iceland deployment of 576 B300 GPUs ($87.5 million contract value, deployment starting late 2026). The previously announced Paris 5-year $160 million+ contract is targeting a ready-for-service date of end of September 2026. - The capital-light managed services model, where customers fund hardware and capacity and White Fiber provides technical and operational support, is seeing strong demand and can deliver attractive incremental margins with existing resources. Large-scale managed services engagements are in active discussions. - White Fiber entered an agreement with Crambu for exclusive access to 100 megawatts of liquid-cooled co-location capacity starting 2027, to support cloud services growth, solving the industry-wide constraint of access to deployable power. Cross-Data Center Networking Technology: - The company successfully demonstrated 111.2 terabits per second bandwidth with guaranteed sub-millisecond latency across 83 kilometers for its patent-pending cross-data center networking technology. - The technology enables aggregation of geographically separate smaller capacity blocks into a single virtual supercluster, increasing the monetization value of White Fiber's existing site portfolio. Initial commercial launch is targeted for September 2026, with potential future licensing opportunities to third parties. Development Pipeline and Capital Strategy: - Demand for power-ready, high-density AI infrastructure for 2027 deployment is extremely strong, creating scarcity for capacity coming to market within 12-18 months. White Fiber's retrofit-first approach (prioritizing sites with existing infrastructure and clear power access) delivers a key speed-to-market competitive advantage over traditional greenfield development. - The company is in exclusive negotiations with a consortium of lenders for permanent secured financing of NC1, with diligence and definitive documentation underway. If completed, the financing will recycle a large portion of invested capital back to the company to fund the next pipeline projects, completing the first turn of the company's planned development flywheel. - A 60 megawatt site (scalable to over 250 megawatts, online in 2027) is in late-stage due diligence, with purchase agreement negotiations underway. The company prioritizes opportunities with investment-grade credit support to improve financeability and execution certainty, maintaining capital discipline and focusing on high-return opportunities.

Guidance

- The full 40 megawatts of contracted capacity at NC1 is expected to reach full run-rate billing by the end of August 2026. - The 5 megawatts development at MTL2 is targeted for completion by the end of 2026. - Initial commercial launch of White Fiber's patent-pending cross-data center networking technology is targeted for September 2026. - The Paris region cloud deployment is targeted for a ready-for-service date of end of September 2026. - The Base10 cloud deployment is targeted to commence service in November 2026, and the Iceland deployment is targeted to commence in late 2026. - The Prime Intellect VeriRubin 200 GPU deployment is targeted to commence service in Q2 2027. - No changes to long-term growth guidance were announced; management maintained its disciplined approach to capital allocation and growth focused on high-quality, high-return opportunities.

Segment performance

Total Q2 2026 revenue was $28.8 million, a 54% increase from $18.7 million in Q2 2025. - Cloud Services: Revenue was $23.8 million, up from $16.6 million in the prior year period. This segment includes $12.3 million of revenue from a previously disclosed customer termination, and represents 82.6% of total Q2 2026 revenue. - Co-location: Revenue was $4.7 million, up from $1.7 million in the prior year period. The increase is primarily driven by contributions from MTL3, which commenced operations in Q1 2025. This segment represents 16.3% of total Q2 2026 revenue. Gross profit (excluding depreciation and amortization) was $17.1 million with a 59% gross margin, compared to $11.5 million and 61% margin in Q2 2025. G&A expense was $14.8 million, down from $17.8 million in Q1 2026. Adjusted EBITDA was $5.5 million, up from $3.3 million in the prior year period. Net loss was $15 million, or $0.39 loss per diluted share. Cash and cash equivalents at quarter end were $56.1 million, with deferred revenue of $143 million primarily from customer prepayments for NC1 and cloud services deployments.

Risks & headwinds

- There is no assurance that the permanent NC1 financing will be completed on favorable terms, or at all. - The 200 megawatts incremental expansion at NC1 and additional capacity expansion at MTL3 are subject to utility regulatory and approval processes, with uncertain timing and outcome. - The industry continues to face persistent supply chain constraints for equipment, and persistent shortages of available power and GPU allocations, which can delay project timelines. - Greenfield data center development faces increasing NIMBY (not-in-my-backyard) community and regulatory pushback, which can impact project timelines and costs, though White Fiber notes its retrofit-first strategy mitigates this risk. - All new project development and contract execution are subject to final negotiation, due diligence, and customer closing, with no guarantee of successful completion.

Analyst Q&A

• Q: With strong inbound demand for the second 45 megawatt tranche at NC1, what is the commercial process timeline and approach to new counterparties? /

  A: The commercial process for the second tranche is still in early phases, with immediate focus on completing phase 1 and the NC1 permanent financing before finalizing the phase 2 project plan. White Fiber has a legal obligation to notify N-Scale of available capacity per the existing agreement, but there is overwhelming demand from multiple third-party counterparties following the successful execution of phase 1. Management will pursue the structure that delivers the most premium economics for White Fiber. /n/n

• Q: How does White Fiber balance customer prepayments in cloud contracts with long-term overall returns? /

  A: All deals are evaluated at the project level against pre-set framework criteria focused on high-quality customers, positive cash flow across the full deal lifecycle, and limited capital deployment from White Fiber's balance sheet. Prepayments are a tool to reduce White Fiber's capital outlay, and the overall deal structure is set to ensure attractive long-term returns. Management is flexible on contract structures, such as adding extension options that benefit both customers and White Fiber. /n/n

• Q: What is the long-term revenue mix expectation between co-location, cloud services, and managed services, and what are the pros and cons of integrated versus separate operations? /

  A: Co-location and cloud require distinct skill sets, so White Fiber currently maintains separate teams by design, and market valuations typically assign different multiples to the two segments. However, there are margin benefits from vertical integration when opportunities align, and the company expects to pursue integrated opportunities sooner than previously expected. The current separate structure creates healthy tension: the cloud team must present a compelling customer and economic case to use co-location capacity, which ensures only high-value opportunities are pursued, benefiting the entire business. /n/n

• Q: How does White Fiber's retrofit strategy and cross-data center technology address growing NIMBY pushback against large data center developments? /

  A: Retrofitting existing sites avoids the land use and construction impacts of new greenfield developments, which inherently reduces community opposition. White Fiber actively engages local communities, highlighting that retrofitted sites often have lower environmental impacts (for example, NC1 uses 85% less water than the prior site tenant). White Fiber deliberately develops smaller modular sites (30MW-60MW) to align with community and power constraints, and cross-data center networking technology allows these smaller sites to be aggregated into large virtual superclusters, delivering the scale customers need without the local opposition of single large greenfield developments.