Riot Platforms: Buy, Sell or Hold?

ATB Capital Markets analyst Martin Toner says Riot Platforms’ (Riot Platforms Stock Quote, Chart, News, Analysts, Financials NASDAQ:RIOT) Q2 results should show progress in shifting data centre revenue toward higher-margin recurring leases.

In a July 20 preview, Toner maintained his “Outperform” rating and $28.00 target on Riot.

Toner said Riot’s data centre business generated $33.2-million of revenue in Q1 2026, but $32.2-million came from lower-margin tenant fit-out services. He expects Q2 results to show that much of the capacity initially delivered to Advanced Micro Devices has moved into recurring operating lease revenue, which management expects to eventually generate gross margins above 80%.

He said investors will focus on Riot’s ability to deliver the remaining capacity tied to AMD, which exercised an option to double its contracted footprint to 50 megawatts of critical IT load. AMD also has options to scale to 200 megawatts.

Toner said the Corsicana campus will also be a key focus. Riot recently consolidated engineering design at the site into one 168-megawatt critical IT building to improve space efficiency without increasing core and shell costs, though no tenant has been signed.

On Bitcoin mining, Toner said investors will look for evidence that Riot managed Texas grid volatility during the high-demand summer period. With mining margins still under pressure, he said the company’s power-credit strategy will be important to lowering electricity costs.

He also said capital spending remains a focus. Riot funded upfront capital needs for the initial AMD data centre retrofits by selling 3,778 Bitcoin for $289.5-million, while management is pursuing non-recourse project financing for the remaining AMD buildout.

Toner lowered his 2026 revenue forecast by $33.4-million to $615.8-million, reflecting lower Bitcoin mining and data centre revenue assumptions. He also raised SG&A expense estimates and lowered expected power curtailment credits.

As a result, he now expects Riot to generate Adjusted EBITDA, excluding Bitcoin fair value changes, of $64.9-million on revenue of $615.8-million in fiscal 2026.

For fiscal 2027, Toner expects Adjusted EBITDA, excluding Bitcoin fair value changes, of $159.9-million on revenue of $752.0-million.

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