Hut 8 Corp. (HUT) Earnings Call Transcript & Summary

Good morning, and welcome to Hut 8's Second Quarter 2020 Financial Results Conference Call. Joining us today are our CEO, Asher Genoot; and our CFO, Sean Glennan. Following the presentation, we will open the line for questions. This event is being recorded and a transcript will be made available on our website. In addition to the press release issued earlier today, our full quarterly report on Form 10-Q is available at hut8.com and our Eco profile at sec.gov and on our SEDAR profile at sedar.ca. Unless otherwise indicated, all figures discussed today are in U.S. dollars. Certain statements made during this call may constitute forward-looking statements within the meaning of applicable securities laws. These statements reflect current expectations and are subject to risks and uncertainties that could cause actual results to differ materially. Certain key risks are detailed in our Form 10-K for the year ended December 31, 2025, and are continuous disclosure documents. Except as required by law, we assume no obligation to update or revise any forward-looking statements. During the call, management may reference non-GAAP measures such as adjusted EBITDA. We believe these measures, alongside GAAP results, provide valuable insight into our performance. Reconciliations of GAAP and non-GAAP results are included in the tables accompanying today's press release available on our website. We'll begin with a moderated Q&A session with our CEO, Asher Genoot, followed by a detailed financial review from our CFO, Sean Glennan. Let's get started.

Good morning, everyone, and thank you for joining us. I'll start today with a conversation with Mark Eidelman, our new Head of Investor Relations, who joined us in June from NextEra Energy. Mark has spent the last several weeks speaking with the research and investor community. And I asked him to share some of the comments, questions, observations that he has heard most. After our discussion, Sean will walk through the quarter and then we'll open up the line for questions. Thanks, Asher.

Investors often describe Patesa bitcoin miner that transition to data center development. I do not think that framing is quite right. What is Hutaand what does PowerFist actually mean.

I think everything starts with 1 simple observation. Electricity is becoming 1 of the scarcest resources in the economy. Hutt is an energy infrastructure platform we build large-scale digital infrastructure around scarce power, AI, Bancorn mining, high-performance computing and whatever comes next, are applications running on that platform. AI happens to be the highest value application today. Power First is not simply a development strategy. It is the operating system for how we allocate capital, manage risk and build the business. So bitcoin mining was our first proof point. We learned how to source low-cost power, build infrastructure faster and more efficiently and operate assets at scale. AI infrastructure rewards those same capabilities but across larger deployments, longer-duration contracts and more financeable cash flows. The operating model has not changed. The opportunity has expanded. In practice, our framework is repeatable. Originate power, secure site control and interconnection, commercialize with high credit quality counterparties, finance efficiently and build and operate against long-duration contracted cash flows. Riverbend, Beacon point and the financings we will discuss today are outputs of that same framework. We're not building a collection of projects. We're building a platform that repeatedly converts scarce power into long-duration contracted infrastructure assets.

That makes sense. Many companies now described themselves as Powerfirst or as AI infrastructure developers. -- how should investors distinguish capability from the client.

Power First is not the differentiator, capability is. The differentiator is the ability to consistently originate commercialize finance and execute infrastructure around scarce power. That starts with how we allocate capital. We don't underwrite applications. We underwrite scarce power. Applications change, customer demand changes, technology changes. Our job is to preserve the flexibility to commercialize that power through the highest value use case over time. Beacon Point is a good example. When we first invested in the site, we underwrote a Bitcoin commercialization path because it offered attractive risk-adjusted returns when we weren't sure the location hit the requirements of AI workloads. But we never underwrote the investment around 1 outcome. We preserved multiple commercialization paths from day 1. And as AI demand accelerated and locations start being more of a preference rather than a requirement, we commercialize the same underlying power through a higher-value application. We do not predict the future. We built the flexibility to adapt to it. Our first 2 AI campuses were not existing bicorn mining facilities that we convert. And I think that's really important for people to understand about the Hut story. So our first 2 campuses that we've announced were not existing backward mining facilities that we have converted. They were greenfield campuses that we originated from the ground up, commercialize with investment-grade anchored counterparties and finance in the investment-grade markets and are now executing through construction. At the same time, approximately 700 megawatts of our infrastructure supports our affiliated tenant, American Bitcoin. That demonstrates that we can commercialize power through more than 1 application. And the market has already provided meaningful evidence of that capability. We have 3 15-year leases with investment-grade anchored counterparties in the last 9 months alone. 2 of the first investment-grade construction financings for single sponsored data center projects and multiple greenfield campuses advance through origination, commercialization, financing and now construction. In infrastructure, capability is not measured by what you say. It is measured by what customers sign and what capital markets finance.

So 1 of the things I want to talk about is financing at JPMorgan, I financed projects at JPMorgan and helped build projects at NextEra. So 1 of the things I'm going to kind of introduce is why I left all of that in joined Hut 8. I think the best way to answer that is to start with what I've learned over the last 20 years. Great infrastructure companies are not built around individual assets. They're built around repeatable systems that can consistently originate, commercialize, finance, build and operate infrastructure over long periods of time. That is what stood out to me about Hut 8. River Bend did not come you can part of loans on documents. What convinced me was that both were produced by the same system. Projects can be replicated systems compelling. Before I joined, I spent time challenge you, Asher, and the team on the risks. -- power origination and interconnection, customer relationships and counterparty quality, delivery time line and construction risk, capital formation and financing, repeatability in the long-term budget. And you all -- you had well thought out answers to each of my questions that demonstrated that you understood the core risks, and we're mitigating them effectively. As no looking for every rep disappear. Infrastructure is not about eliminating risk. It's about understanding that structuring it and allocating capital accordingly. Having spent my career financing, helping build infrastructure businesses. I recognize the same characteristics I've seen in the very best platform disciplined capital allocation, rigorous risk management and a repeatable system for creating value. This is also a rare opportunity to help an infrastructure company at the beginning of its journey around 1 of the most valuable resources in the economy power. Large infrastructure platforms are built by repeatedly applying the same disciplined framework over many years. I believe Hut 8 is at the beginning of that journey. So Asher, topic you hear most from investors execution risk. Hutch has not yet delivered projects of the scale on this time line for counterparties of this quality. What is the basis for your confidence and on time to operate?

I think execution starts long before construction. People often think execution begins when you start pouring concrete. And I think construction is the final stage of execution, not the beginning of it. By the time construction starts, a lot of the most important decisions should have already been made. That's why we think about execution as a system and not an event. It starts with disciplined underwriting, power origination, site control, permitting, engineering, procurement, financing, counterparty alignment, construction sequencing, every 1 of those decisions is made to reduce uncertainty before we mobilize on site. And so our confidence rests on 3 things: Priority, delivering Riverbend and Beacon Point on time is our #1 priority, our reputation and the repeatability of the model depend on it. Discipline, permitting, procurement, site work, power delivery and counterparty coordination all run in a single integrated schedule with conservative assumptions. And three, demonstrated capability. We have energized industrial sales capacity before and repeatedly. The application has changed, but the discipline required to deliver has not. In every campus we developed makes the platform stronger. It improves our engineering, supply chain, execution, institutional relationships and ability to deliver the next campus. Execution is not something that we hope for. It's something we design for every campus we develop makes the platform stronger.

Let's talk about Riverbed. Where does construction stand today at River band? And what are the key milestones between here and energization.

So delivery is part of our model investors can verify in real time. And we're very pleased with where Reena stands today. The team is executing well. So structural steel erection began in early June. The building foundations are expected to be completed before month's end. And that opens up additional work front and allows crews to move in parallel rather than sequential right now. We began steel erection on the substation in mid-July. And now we're beginning slab-on-grade floors across the auxiliary support yard in the main building. And none of that is accidental. It's what disciplined sequencing integrated planning in 1 delivery schedule are designed to produce, so every milestone does more than advance Riverbend, it strengthens our engineering supply chain and execution capabilities and our cability behind the next transaction. As our customers and our partners look at how we execute, they build more and more confidence. And so Riverbend is not -- it is not only a building. It's a campus is building capabilities that will make every campus after it in every building on the campus much better.

Thanks, Asher. Let's just a fee point. We announced the second big in point lease last month. What does that transaction demonstrate?

Beacon Point building to is important for a much bigger reason than just signing another lease. It's another proof point that our framework is repeatable, the progression matters. Riverbend demonstrated that we could commercialize a greenfield campus with an investment-grade anchor counterparty. I know a lot of people are waiting for that and we were able to announce that last December. Then Beacon Point Building 2 -- Building 1 demonstrated that the framework was repeatable, but with a different customer and then Beacon Point Building 2 demonstrated something different. Again, an existing customer chose to expand under the same commercial framework. So different customers, same operating model, similar lease structure, same long duration contracted cash flows. And the second Beacon Point lease is for 352 megawatts of IT capacity. -- and represents about $9.8 billion of expected base term contract value. With that lease, the campus is now fully commercialized with full gigawatt of utility capacity supporting contracted investment-grade cash flows. And the customer chose to double its footprint at Beacon Point. We think that's 1 of the strongest forms of validation and an infrastructure platform can receive. And customers don't expand because of presentations, they expand because they have confidence in the asset, confidence in our ability to deliver. And Beacon Point also reinforces how we allocate capital. We originally, as I mentioned, underwrote the site for a bit on commercialization path, but we preserved these multiple paths from day 1. And so when the market evolved, we were able to commercialize that same power through a higher application and build it from greenfield. And we didn't change the asset, we just changed the application. So at the platform level, Beacon Point now represents 704 megawatts of contracted IT capacity, roughly about $19.6 billion of expected base term contract value. And so together with River Bend, total contracted AI data center capacity is about 949 megawatts, representing roughly $26.6 billion of expected aggregate base term contract value, all produced by the same operating model in less than a year. And so every commercialization expands the platform. and it's what compounding looks like for us. So Mark, a key part of Riverbend and Beacon Point is not only the signed lease but the executed financing behind it. When you look at the Riverbend financing from the outside, what did it signal to you?

Sure. Well, let me start with we impress me mode. It was not the size of the financing. It was what the market agreed to underwrite. -- transaction consisted of $3.25 billion of fully amortizing senior secured note rate investment grade issues at the project level, nonrecourse to hide and backed by contracted lease revenues from campus still under construction. Investment-grade market has historically not financed construction stage data centers, especially single-sponsor single-asset projects. Yet rating agencies and fixed income investors underwrote the contract structure, counterparty credit and backstop high night delivery model and risk allocation for 16.5 years covering the expected construction period and the entire 15-year lease. Having spent years on the other side of that analysis. I can tell you that credit committees do not finance ambition. They finance certainty and execution. That was institutional validation of the development model expressed the most rigorous currency to its committed capital at investment-grade pricing. We also improved the capital formation model. Each project raises debt against its own contracted cash flows, nonrecourse of the parent and fully amortizing. That generally ring-fences development risk and preserves capacity at a fair level. River Bend more than financed on campus a create repeatable template for financing future campuses. You can point then imply that template again and an even better terms. River Bend did does not finance a CapEx priceable engine for funding growth. So Asher, that big important financing, as I mentioned, was executed on better terms than Riverbend, a higher rating, higher pricing, greater scale, so what does that improvement tell you? And how does the capital start to support growth from here?

I think it tells us that capital falls capability. We did not get an investment-grade financing because we wanted it. We earned it through the disciplined execution -- and so when we first started River Bend I talked about this in 1 of our previous earnings, we went to the rating agencies and the investment-grade result was because of what we presented them, not because we went in expecting that. And so Beacon Point consisted of $4.25 billion of senior secured notes. The notes were rated 1 notch higher above River Bend, and they priced 20 points inside of River Bend, and the offering was substantially oversubscribed, with repeat investors returning and also new investors joining and we plus amortization from 2 years on Riverbend to 4 years on Beacon Point. We did not copy the transaction. I think that's really important because it would have been easy to do so. We structured every term from first principles again. And the result resulted in improved ratings, pricing, scale and amortization. And we didn't negotiate our way to better terms. We earned it to -- through the way that we structured and the way that we built the second project. The structure is also what allows us to scale. It's fully amortizing. So there's no refinancing wall at the project level. It's nonrecourse to the 0 recourse debt at the parent level. And it's not dilutive to equity holders and each project is designed to generate sufficient cash flows to support the related construction financing. So growth is not constrained by the corporate balance sheet, and we can develop multiple campuses at once. And so together, River Bend and Beacon Point Building 1 represents approximately $7.5 billion of investment-grade capital raised for construction stage development. Every successful financing expands the platform's ability to finance the next one. And this is capital formation compounding in real-time in front of you all. Capital follows capability. and better capital is burned through better execution.

Asher, let's shift gear a little bit. Behind the model capital as an organization. how do you build 1 that can deliver at this scale and keep delivering as a platform grows?

I think people are ultimately what determine whether a platform can compound over time. organizations don't scale because they own great assets. They scale because they build capabilities that can be repeated, and people create those capabilities. We've built the organization around actual life cycle of a project not around a traditional corporate or chart. So origination, underwriting, development, financing, delivery operations. And we've been equally deliberate about the type of people we recruit. We want builders who take ownership enjoy solving hard problems, think from first principles and want to build something that compounds over decades, not quarters. I spoke about having more of a -- being a company that's more of a religion rather than a job on my last quarterly earnings. And honestly, I've had multiple folks interview and bring that up and say, "I want to join this mission." And so like-minded folks really attract each other. And I think of the team we assembled for a project almost like a group of Navy Seals, not an army everyone brings a specific skill set. Everyone has operated at a high level on that function, and they come together as 1 unit to execute from start to finish. And we have also invested in talent with deep backgrounds across power, development, infrastructure, procurement, project execution and capital markets. I mean, Mark, you're an example of that. That investment shows up, though, in SG&A and we do not view it as overhead creep. We view it as an investment in platform capacity and capability because we're so focused on growth and scale. After our first 2 campuses, we now have a repeatable framework across design and engineering, supply chain, contracting, financing and delivery. And organizations learn capabilities compound. Every campus improves the team and the improved team makes the next campus better. So people are not separate from the platform. They are the platform, and they are the capability that compounds every other capability.

Thanks for that, Asher. Let's talk about the pipeline. Investors want greater visibility into the development pipeline. How do you decide what enters the pipeline? And what changes quarter?

Look, I think it's a fair ask. And I think the first step is to frame the question correctly, the goal is not to build the largest headline megawatt number. The goal is to convert the right opportunities into financeable commercializable infrastructure. and we manage the pipeline like an underwriting exercise. The project must clear a series of gates before it moves forward. So power scale and speed to power, interconnection certainty, site control and a path towards permitting network access, customer demand, capital intensity and risk-adjusted returns. Every megawatt in the reported pipeline has already been tested rent's criteria. And that's what makes a number meaningful, not simply large. Through that lens, the development pipeline now stands at about 8.7 gigawatts, up approximately 300 megawatts from last quarter. We have 11 sites in the under diligence at under exclusivity stages, averaging more than 650 megawatts each. On average, those opportunities are larger than each Beacon Point building. We did not only grow the pipeline, we advanced it. The exclusivity stage increased by 200 megawatts as projects move forward from diligence. And what's really, really important is the reported number also excludes M&A opportunities behind the meter power generation solutions and potential River Bend expansion, where the tenant holds the right of first offer on the next gigawatt. So the direction of opportunity flow is also changing. River Bend and Beacon Point have led more developers and power producers to bring opportunities to us rather than the other way around. They see our ability to execute our ability to finance at scale and have tenant -- deep tenant relationships. And so we're having more inbound interest from an M&A perspective more than ever from developers who have a piece of land and interconnect and need someone to commercialize that for them. And I think that's a sign that the platform itself is beginning to compound. And so we don't optimize for the biggest pipeline. We optimize for the highest quality pipeline and investors should underwrite the platform's ability to repeat not only the next lease.

Last question for you, Asher. There was clear philosophy underpinning these answers. How do you simply summarize our philosophy for investors?

It comes down to a handful of principles we were to turn to every day. Scarcity creates opportunity. First principles identified that opportunity. optionality protects capital. Commercialization creates value. Execution earns trust capital follows capability. platforms come out. Everything starts with power, and we have built the operating system that turns those principles into contracted cash flow. And we are proud of what the team has accomplished, but we still believe we are very early. Every campus strengthens the platform. Every financing expands our capabilities. Every customer deepens our relationships and every great person makes the organization stronger. When I would encourage investors to underwrite is not our next project. It is our ability to compound capabilities over time. create projects that create earnings and compounding capabilities that create enduring enterprise value.

Aster, thank you. Sean, let's turn to the quarter's financial results. Investors can read the income statement in the 10-Q. So I want to focus this discussion on what the numbers say about the underlying business, the balance sheet and Hut 8's ability to finance growth. Revenue increased meaningfully year-over-year. Adjusted EBITDA improved and the quarter still showed a significant GAAP at loss. How should investors reconcile those results?

Thanks, Mark. I think there are 3 key takeaways in our financials. One, the operating business grew; two, margins expanded; and three, EBITDA improved. Moving to the P&L items themselves. Revenue increased approximately 81% year-over-year to $74.9 million, while cost of revenue increased by approximately 23%. That produced gross profit of approximately $48 million and expanded gross margin to approximately 64% compared with approximately 47% in the prior year period. Adjusted EBITDA, excluding digital asset mark-to-market movements was $10.4 million. That compares with $4.2 million in the prior year period. The GAAP net loss of $177.1 million was driven primarily by $138 million loss in digital assets. Bitcoin declined during the quarter, while it had increased materially in the prior year period. So the year-over-year comparison is dominated by a noncash mark-to-market swing.

Thanks, Sean. Let's go 1 level deeper. We are the most important drivers across power, digital infrastructure and compute.

So compute remained the primary operating contributor. Revenue increased to $72.5 million from $34.3 million, which was driven by an increase in Bitcoin mine from approximately $308 to approximately $935, that growth reflects additional operating capacity following the commencement of operations at Vega and the reenergization of our Drumheller facility. Compute cost of revenue increased at a much slower rate than revenue itself, resulting in a segment gross margin of approximately 66%. That operating leverage is important because it demonstrates the earnings capacity of the current platform even before our contracted AI data center revenues begin contributing. Digital Infrastructure revenue was $1.3 million, that was broadly consistent with the prior year period. Today, that segment still reflects the legacy base, its financial profile changes materially as Riverbend and Beacon Point data halls are delivered and the associated long-duration lease revenues begin coming online. Power revenue declined to $1.2 million from $5.5 million, and that's primarily because the prior year quarter included a full quarter of activity from the Far North portfolio, which we sold in February. That decline is, therefore, not a function of decline in revenues, but it's a function of portfolio management.

General and administration expense increased substantially. How should investors distinguish between recurring overhead and investments in the platform?

Yes. It's something Asher touched on is something that we focus on a lot. It's really important to us. Reported G&A was $76.1 million, and that compares with $30.2 million in the prior year period. However, approximately $43.6 million of the increase was share-based compensation. So the majority of the year-over-year was noncash. Cash investment also increased as we added talent and capabilities to support a much larger development platform. Salaries and benefits increased by approximately $4.1 million primarily from additional head count supporting growth initiatives, not maintenance initiatives, particularly in our energy origination group. We evaluate SG&A through -- excuse me, we evaluate SG&A spending through growth versus maintenance lens. The organization required to maintain today's operating base is meaningfully smaller than the organization required to originate finance, construct and operate multiple -- multimillion-dollar campuses in parallel. That does not mean growth spending is unconstrained. We expect every investment in people, systems and capabilities to be tied to specific commercial outcomes, more high-quality power origination, faster project conversion, lower cost of capital, improved execution and stronger operating leverage over time.

Let's talk about the balance sheet. It looks very different. Cash and restricted cash increased to approximately $7 billion total debt increased to approximately $7.6 billion. Whereas -- what is the right way to interpret those figures?

So the first distinction is between corporate liquidity and project restricted capital. At June 30, we had approximately $233.6 million of unrestricted cash and approximately $6.8 billion of restricted cash and cash equivalents. The cash -- the restricted cash primarily represents proceeds from the Riverbend and Beacon Point financings. And those are held with project accounts and can only be used for construction, debt service reserves and other specified project purposes. It is not excess corporate cash and the related debt is not general corporate leverage. Similarly, the majority of that approximately $7.6 billion carrying amount of debt consists of the $3.25 billion River Bend notes and the 4.25 billion Beacon Point notes. Those obligations set a bankruptcy remote project subsidiaries. They are secured by the applicable project assets and accounts and importantly, our nonrecourse to Hut 8's parent company. So the consolidated balance sheet has become larger because of 2 of our 3 projects under construction are fully financed. Economically, each project is designed to service its own debt from its own contracted lease cash flows. That's the financial architecture we want. Ring fins project risk, preserve parent flexibility and minimal reliance on corporate equity.

[indiscernible] will also never interest expense increased sharply, while interest income increased to $27.1 million how should they think about the construction period carry on these financings.

Interest expense increased because we closed $7.5 billion of long duration project financing during the quarter. That's expected when fully funding 2 campuses before the lease revenues begin. Importantly, the proceeds are not sitting idle. Undrawn construction funds are invested in short duration instruments within project accounts. Those funds generated $27.1 million of interest income in the quarter, partially offsetting the interest cost on the notes. We also capitalized $5.7 million of interest into construction and progress during the quarter. The accounting, therefore, reflects 3 components: interest expense recognized currently, interest income earned on undeployed proceeds, and interest capitalized as part of the cost of the assets under construction. I think the broader point is that we structured these financings to remove refinancing risk and secure the full construction capital upfront. There's a cost of carrying committed capital during construction, but we believe that cost is outweighed by the certainty of funding protection against future capital market volatility and the ability to execute without returning to the market in mid build.

How do the curse convert under the Falcon X refinancing change the parent-level balance sheet during the quarter? In our minds, it was pretty meaningful. So in May, converted the approximately $159.3 million of accretive principal balance of its note into $9.7 million shares. That eliminated our only remaining parent recourse debt. We also refinanced $200 million coin-based facility with a new $200 million Falcon X term loan. The coupon declined from 9% to 7% as a result of the refinancing and the facility is collateralized by BigPoint, not the parent. Those transactions simplify the parent capital structure. Excluding ordinary course obligations, the parent is not obligated under the Riverbend or Beacon Point notes, and the remaining significant financing is secured by a discrete pool of Bitcoin. That matters because 1 of our most valuable corporate assets is flexibility. The clean parent balance sheet gives us the ability to fund early-stage development, absorb timing differences, pursue strategic opportunities and choose the right financing for each asset rather than being forced into the financing that happens to be available at a specific given point in time.

Beacon Point finance, and the second phase is now contracted. -- what principles will guide finance and we employ in Phase I and a broader development pipeline?

So I think it really comes down to 4 principles. As always, the first principle is going to be asset level self-sufficiency. We're going to seek to finance each project against its own contracted cash flows with risk generally ring-fenced of the project and no recourse to the parent wherever feasible. The second principle is optimization rather than repetition. Riverbend established the market. BEACON Point 1 improved on that execution with a larger issuance, a lower coupon, a higher rating and a later start to schedule amortization. We will not assume the next financing should look identical -- we're going to evaluate the asset, the lease, the construction schedule, market conditions and investor demand from a first principles perspective. Third principle is disciplined use of equity. Equity should fund the portion of the development cycle where it creates the most value, origination, site control, interconnection, design and other work required to convert an opportunity into a financial project. Once contracted cash flows are in place, we want long-duration project capital to fund construction. And the fourth and final principle is preserving liquidity across the portfolio. The model needs to support several campuses advancing at once, not just 1 project at a time. That means matching duration, amortization, covenants and recourse to the economics of each asset while maintaining capacity of the parent.

Thanks, Sean. To close, what should investors take away from the quarter from a financial perspective?

Yes. And I think this is really important. So the first, the operating business has strengthened. Revenue grew gross margins expanded and operate an adjusted EBITDAX, excluding digital asset mark-to-market increased year-over-year. Second, the capital market -- the capital formation model moved from content to repeatable execution we raised $7.5 billion of investment-grade long-duration project financing for 2 construction stage campuses with no recourse to the parent. Third, the parent balance sheet became cleaner. The CO2 note converted, the Bitcoin back facility was refinanced at a lower coupon and the majority of consolidated debt is now matched to contracted project cash flows. And finally, the financial profile is in transition. Today's income statement is still dominated by compute and digital asset accounting. As Riverbend and Beacon Pointer delivered, the mix shift meaningfully towards long-duration contracted digital infrastructure cash flows. Our focus is to manage the transition with discipline. -- execute the projects, protect the parent balance sheet and finance growth in a way to compound value per share.

Thank you, Sean. That concludes our prepared discussion. Operator, please open the line for questions.

[Operator Instructions] Our first question will come from the line of Stephen Byrd with Morgan Stanley.

I wanted to just dive into behind-the-meter generation and really just get your overall temperature check in terms of how desired is this by your customers? I guess this can really help to create much larger sites and move much faster potentially. So it strikes me as a very good complement to the grid access that you have and actually spoken to this before. But just curious to your latest thinking in terms of how likely is this in your view? How important is this to your customers to be able to sort of achieve both the timing and scale objectives that they have? I love any comments you might have on that.

Behind the meter, and thanks, Stephen. I appreciate the question. Behind-the-meter capacity will happen. We see the demand. We see the opportunities for them within our pipeline. and they're the fastest speed towards power. And I think not only do the customers want it, but the grids that are looking at -- we're built looking at building out, they want us to bring power and additional to consuming from the grid. -- right? They want us to help offset as well. The reason why we don't include behind-the-meter opportunities in our development pipeline is because we feel like those megawatts are bites in genuine, what do I mean by that? What I mean is if we have a piece of land, we have an interconnect on there in terms of substation transmission capacity, and we have a pipeline, frankly, we can put as many megawatts as the pipeline can support from a gas perspective. right? So Riverbend could be a multi-gigawatt site that we put into our pipeline. And so the numbers that we would have in our pipeline would far exceed the over 8 gigawatts that we have today if we include behind-the-meter opportunities. And so the way we see those similar to M&A where if they become real and they become executor contracted, you see that as additional catalysts that come in that are not as trackable, but we're working on a ton of opportunities on both behind the meter and M&A across different functions of the team today.