(SeaPRwire) – By: Reginald Vance
The market saw a $30.4M revenue quarter and a $141M operating loss. The stock went up 1.57%. That tells you everything about what Keel Infrastructure is actually selling now. It’s not power. It’s not Bitcoin. It’s a financial thesis on the HPC site development pipeline. Investors are betting that Gagnon’s “power is the constraint” line is the real play. But the numbers right now are brutal.
Revenue dropped 50% year-over-year. That’s the Moses Lake mining shutdown hitting the books. The operating income swung from a positive $11M to a loss of $141M. Include $84M in non-cash depreciation and the picture is still ugly. Adjusted EBITDA from continuing operations went negative $24M. That’s a $30M swing from the same quarter last year. The company burned cash to wind down its mining operations and to hire senior talent for the HPC project management phase. G&A alone jumped from $19M to $31M.
The balance sheet is the only thing keeping this story alive. Keel raised $458M through a convertible note during the quarter. They have $819M total liquidity. $698M in unrestricted cash. $121M in Bitcoin. That’s a war chest. But the Bitcoin number is shrinking. Between April 1 and August 7, they sold 1,085 BTC for $75M. They now hold 1,861 BTC. The wind-down is real. The treasury is being converted to fiat for construction capital.
The HPC pivot rests on three priority sites. All three are nearing full permitting. Panther Creek and Sharon have zoning and land development approvals. Moses Lake just accepted its first Vertiv modules. Fiber contracts are being finalized. The Sherbrooke project in Quebec got a conditional transfer of 96 MW from Hydro-Sherbrooke. That’s a solid power anchor. The company has multiple tenants in active negotiations at each site. Uncommitted 2027 capacity is available across PJM and Washington. That’s the pipeline.
The capital efficiency question is the real test. Keel spent $458M on convertible notes. They have a $141M operating loss. They are burning cash at a rate that requires a clear line of sight to tenant revenue. The CEO is betting that power access is the bottleneck. The CFO says the company is better capitalized than ever. But the market is pricing in a future that hasn’t arrived yet. The revenue from Q2 came from a dying business. The revenue from Q3 and Q4 will come from a business that isn’t built yet.
The industry veterans being hired are a signal. The $31M G&A line is front-loaded. That’s a bet on execution. If the three sites come online with tenants attached, the stock looks cheap. If the permitting delays continue or the tenant negotiations fall through, the cash burn accelerates. The 2027 capacity is the pivot point. Keel is trading a legacy mining business for a speculative HPC infrastructure play. The market is giving them credit for the vision. The P&L is not yet cooperating.
Author bio: Reginald Vance, a venture partner specializing in semiconductor valuation and advanced materials, tracking capital efficiency in hardware-intensive infrastructure plays.