Bit Digital, Inc. Executes MSA for 576 H200 GPU Deal with DNA AI Compute Fund

Rhea-AI Summary

Bit Digital (NASDAQ: BTBT) has executed a Master Service Agreement with DNA AI Compute Fund for 576 Nvidia H200 GPUs over a two-year term. The contract, valued at approximately $20.2 million, is expected to begin in February 2025. Bit Digital will provide 72 H200 servers to be deployed at a data center in Iceland.

The company recently ordered 130 H200 servers (1,040 GPUs) for about $30 million, with the remaining GPUs planned for separate customer contracts. This agreement advances Bit Digital's goal of reaching a $100 million annualized revenue run-rate for its HPC business in early 2025, reflecting their strategy of prioritizing quality revenue opportunities and disciplined capital management.

Positive

• Secured $20.2 million two-year contract for GPU services
• Ordered 1,040 H200 GPUs worth $30 million, showing expansion
• Strategic positioning in high-performance computing market
• On track for $100 million annualized revenue run-rate by early 2025

Negative

• None.

Insights

Technology Infrastructure Analyst

The $20.2 million GPU infrastructure deal marks a strategic pivot in Bit Digital's business model, moving beyond pure crypto mining into high-performance computing. The 576 Nvidia H200 GPUs represent cutting-edge AI computing capacity, with each unit significantly more powerful than its predecessor, the H100. The Iceland deployment location is particularly noteworthy for its cost-effective cooling and renewable energy access, which could yield higher operating margins.

The contract structure, spanning two years, provides stable revenue visibility and helps de-risk the $30 million GPU investment. The pricing suggests an approximate $17,500 monthly revenue per server, aligning with current market rates for high-end AI compute infrastructure. This deal structure reflects industry best practices for capital-intensive HPC deployments, balancing upfront costs with predictable returns.

Financial Analyst

The deal's financial implications are substantial for a company with a $458M market cap. The $20.2 million contract value represents roughly 4.4% of the current market capitalization, while the broader $30 million GPU purchase order suggests aggressive expansion plans. The timeline shift for reaching $100 million annualized revenue indicates disciplined capital allocation, prioritizing quality over speed.

The company's focus on 'high-quality revenue opportunities' and 'disciplined capital management' suggests a mature approach to managing the high-stakes HPC market. The strategic decision to secure contracts before deploying capital intensive GPU infrastructure demonstrates sound risk management, particularly important given the rapid technological evolution in the AI hardware space.

NEW YORK, Dec. 31, 2024 /PRNewswire/ -- Bit Digital, Inc. (Nasdaq: BTBT) ("Bit Digital" or the "Company"), a global platform for high-performance computing ("HPC") infrastructure and digital asset production headquartered in New York, announced today that it has executed an MSA with a new client, an AI Compute Fund managed by DNA Holdings Venture Inc., which provides for 576 Nvidia H200 GPUs over a two-year term. The contract represents an aggregate revenue opportunity of approximately $20.2 million for Bit Digital and is expected to commence in February 2025.

This announcement builds on the term sheet previously signed and disclosed on November 20, 2024. Under the terms of the deal, Bit Digital will supply the customer with 72 H200 servers (576 GPUs) for an initial two-year term. Bit Digital will fulfill the contract with GPUs that are currently on order and awaiting delivery to a third-party data center in Iceland. Earlier this month, Bit Digital placed a purchase order for 130 H200 servers (1,040 GPUs) for approximately $30 million. The Company anticipates deploying the remainder of those GPUs to separate customer contracts.

Sam Tabar, Bit Digital's CEO, commented: "We are thrilled to formalize our partnership with DNA Fund. This strategic collaboration underscores our commitment to delivering high-performance computing solutions tailored to our clients' evolving needs.

This contract is a meaningful step toward achieving our long-term growth objectives. While we now expect to reach our $100MM annualized revenue run-rate goal for our HPC business in early 2025, this timeline reflects a deliberate strategy to prioritize high-quality revenue opportunities and disciplined capital management. As we navigate a significant chip upgrade cycle, we have been selective about the deals we pursue, focusing on the right customers, favorable terms, and pricing. This approach enables us to mitigate residual value risk while maintaining the financial flexibility needed to support our data center expansion and next-generation GPU investments.

With a robust balance sheet and a strong pipeline of opportunities, we remain confident in our ability to achieve sustained growth and strengthen our leadership position in the HPC market."

About DNA Fund

DNA Holdings Venture Inc. aims to spearhead the next wave of financial innovation by seamlessly integrating Web 3, cryptocurrency, artificial intelligence, and capital markets. DNA's mission is to create a financial ecosystem that delivers cutting-edge fund management, strategic advisory services, and visionary financial solutions. By leading this technological and financial convergence, DNA Holdings empowers emerging brands to architect the future of finance, transforming the global economy and reshaping the world of capital markets. For additional information please contact investors@dna.fund or www.dna.fund.  For information on investing in DNA Funds please visit DNADealDesk.com 

About Bit Digital

Bit Digital, Inc. is a global platform for high-performance computing ("HPC") infrastructure and digital asset production headquartered in New York City. Our bitcoin mining operations are located in the US, Canada, and Iceland. For additional information, please contact ir@bit-digital.com or visit our website at www.bit-digital.com.

Investor Notice

Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described under "Risk Factors" in Item 3.D of our Annual Report on Form 20-F for the fiscal year ended December 31, 2023 ("Annual Report"). Notwithstanding the fact that Bit Digital Inc. has not conducted operations in the PRC since September 30, 2021 we have previously disclosed under Risk Factors in our Annual Report: "We may be subject to fines and penalties for any noncompliance with or any liabilities in our former business in China in a certain period from now on." Although the statute of limitations for non-compliance by our former business in the PRC is generally two years and the Company has been out of the PRC, for more than two years, the Authority may still find its prior bitcoin mining operations involved a threat to financial security. In such event, the two-year period would be extended to five years. If any material risk was to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline and you could lose part or all of your investment. The risks and uncertainties we describe are not the only ones facing us. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. Future changes in the network-wide mining difficulty rate or bitcoin hash rate may also materially affect the future performance of Bit Digital's production of bitcoin. Actual operating results will vary depending on many factors including network difficulty rate, total hash rate of the network, the operations of our facilities, the status of our miners, and other factors. See "Safe Harbor Statement" below.

Safe Harbor Statement

This press release may contain certain "forward-looking statements" relating to the business of Bit Digital, Inc., and its subsidiary companies. All statements, other than statements of historical fact included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects," or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.

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SOURCE Bit Digital, Inc.

FAQ

What is the value of Bit Digital's (BTBT) new GPU contract with DNA AI Compute Fund?

The contract is valued at approximately $20.2 million over a two-year term.

How many Nvidia H200 GPUs will BTBT deploy under the DNA AI Compute Fund agreement?

Bit Digital will deploy 576 Nvidia H200 GPUs (72 H200 servers) under the agreement.

When will BTBT's GPU contract with DNA AI Compute Fund commence?

The contract is expected to commence in February 2025.

What is BTBT's recent GPU purchase order size and value?

Bit Digital placed a purchase order for 130 H200 servers (1,040 GPUs) for approximately $30 million.

What is Bit Digital's (BTBT) revenue target for its HPC business?

Bit Digital aims to reach a $100 million annualized revenue run-rate for its HPC business in early 2025.