Bernstein has raised its 12-month price target for Riot Platforms to $35 from $30, arguing that the company’s newly announced $9.1 billion AI data center agreement could make colocation hosting—not Bitcoin mining—the dominant driver of its valuation.
The research firm retained its Outperform rating after Riot signed a 20-year lease for 191 IT megawatts of capacity at its Rockdale, Texas campus with a customer described as a “leading frontier AI lab.” The counterparty has been reported as Anthropic, though the agreement itself uses the broader description.
Riot shares climbed more than 27% in pre-market trading on Tuesday before retreating to about $22.60. Bernstein’s $35 target represented roughly 80% upside from Monday’s $19.40 close, based on the firm’s updated assumptions for contracted AI infrastructure revenue and financing.
Bernstein estimates that the Rockdale agreement will produce $457 million in annual recurring revenue. Its analysts, led by Gautam Chhugani, modeled annual net operating income of between $365 million and $411 million once the site is operating at the expected scale.
Ai hosting now dominates Bernstein’s valuation
The new model assigns $12.3 billion of value to Riot’s AI colocation business, equivalent to 84% of its $14.7 billion target enterprise value. Bitcoin mining accounts for about $1.7 billion, or 11%, while the company’s Bitcoin holdings contribute a further $740 million, or 5%.
That composition marks a sharp change from the conventional view of Riot as a publicly traded proxy for Bitcoin mining economics. The company still operates substantial mining capacity, but Bernstein’s framework increasingly treats its Texas land, power infrastructure, and data center development capability as the assets with the greatest potential value.
After including net debt, Bernstein projected a market capitalization of about $13.15 billion over the next 12 months. The estimate depends heavily on Riot delivering its planned AI facilities, securing financing, and converting prospective tenant interest into binding contracts.
Bernstein raised its assumed annual revenue yield for AI colocation to $2.2 million per IT megawatt, from $1.5 million in its previous model. It also lifted its estimated EBITDA margin to 84% from 80%, reflecting the long-term contracted nature of the lease and the infrastructure economics expected from large AI computing customers.
AI colocation refers to providing powered, cooled, and connected data center space to customers that install and operate their own servers. For Riot, this would create contractual rental-like revenue that is less directly exposed to Bitcoin price swings, mining difficulty, and the changing economics of block rewards.
Rockdale contract expands Riot’s contracted capacity
Riot now has 241 IT megawatts of AI capacity under contract, according to Bernstein’s analysis. That figure includes 50 MW previously contracted with AMD and the 191 MW committed under the new frontier AI lab lease.
The firm’s 2030 forecast assumes Riot reaches 391 IT MW of contracted capacity. The remaining 150 MW in the model has not been signed, but Bernstein expects Riot to secure additional agreements on terms broadly comparable with its existing contracts.
The Rockdale lease is also accompanied by an interim financing arrangement. Bernstein said Riot obtained a $573 million facility from Morgan Stanley to fund early equipment procurement. The facility gives Riot capital to begin preparing infrastructure before longer-term project financing is completed.
The analysts expect Riot’s AI colocation revenue to reach about $900 million by 2030, up from around $600 million in the previous forecast. They project AI-related EBITDA of roughly $700 million, compared with $500 million under their prior model.
Those estimates place execution at the center of the investment case. Riot would need to build enough power, cooling, networking and physical capacity to meet the requirements of high-density AI computing systems, which place greater demands on data centers than many traditional enterprise workloads.
Financing and Texas concentration remain central risks
Bernstein estimated Riot will need an additional $3.7 billion in secured financing to complete the buildouts included in its model. That amount equals about 90% of projected project capital expenditure, which the analysts put at $2.1 billion to $2.3 billion for the Rockdale contract.
A large financing requirement can reshape the economics of an infrastructure expansion. Debt costs, access to capital, construction schedules, equipment availability and customer credit quality will all influence whether Riot can achieve the margins in Bernstein’s forecast.
The firm also identified construction execution and geographic concentration as material risks. Riot’s core AI ambitions are tied to Texas, where its Rockdale and Corsicana campuses offer access to land and power infrastructure but also leave the company exposed to local grid conditions, weather events, permitting processes and regional power-market dynamics.
Riot has also disclosed a non-binding letter of intent with a single tenant for its 1-gigawatt Corsicana site. A signed agreement there would substantially expand the company’s hosting pipeline, though a letter of intent does not carry the same contractual weight as the Rockdale lease.
Mining remains part of Riot’s funding strategy
Riot held 11,380 BTC as of June 30, valued at about $731.5 million in Bernstein’s assessment. That balance had declined from a prior high of 19,368 BTC as the company sold Bitcoin production and portions of its reserves to support data center development.
The approach places Riot among mining companies seeking to use Bitcoin balance sheets and operating cash flow to fund expansion into AI infrastructure. Mining remains capital-intensive, with profitability affected by electricity costs, fleet efficiency, network competition and Bitcoin’s market price. Long-duration hosting contracts could give operators a more predictable revenue base, though they replace some mining-market exposure with construction and tenant-concentration risk.
For Riot, the $35 target rests on whether its Texas campuses can become commercially operational AI infrastructure rather than remaining primarily large-scale Bitcoin mining sites. The Rockdale deal provides the first major contract supporting that transition, while the financing and construction work will determine how much of Bernstein’s projected valuation is ultimately realized.
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