Bitfarms (TSE:BITF) announced to convert its Bitcoin mining activities into artificial intelligence and high-performance data centres over the next two years, and soon after, Bitfarms’ stock fell precipitously.
With completion planned for December 2026, the company said on Thursday that its 18 megawatt Bitcoin mining facility in the US state of Washington will be the first to undergo a complete transformation to allow AI and high-performance computing.
Bitfarms’ stock price is down
“Despite being less than 1% of our total developable portfolio, we believe that the conversion of just our Washington site to GPU-as-a-Service could potentially produce more net operating income than we have ever generated with Bitcoin mining,” said Bitfarms CEO Ben Gagnon.
At the time of writing, the stock was trading on the Toronto Stock Exchange at CAD $3.62, down 18.47% (-0.82) on the day. The global market cap is at CAD 2.04 billion.
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He noted that the conversion will benefit the company when it phases down its Bitcoin mining operations in 2026 and 2027.
As the crypto mining industry has grown, Bitfarms’ competitors have begun to convert part of their operations to AI. A multi-year $9.7 billion deal between Bitcoin miner IREN and Microsoft to provide the tech giant access to its AI computing was disclosed earlier in November.
AI is one of the best scopes for Bitcoin
During an earnings call, Gagnon informed investors that Bitcoin miners will “rotate out to lower and lower cost jurisdictions” as the cost and complexity of mining the cryptocurrency rise.
“One of the big dynamics that is taking place is that the public miners represented almost a third of the entire network, and they all seem very keen on moving over to the higher economics associated with HPC and AI,” he added.
Gagnon stated that Bitcoin mining has begun to expand significantly in the Middle East, Africa, and Russia, and that “the best opportunity for most miners in the United States really is this transition to HPC and AI.”
“The economics are really going to drive that forward because the US is the best market to invest in for HPC and AI, whereas Bitcoin mining is largely location-agnostic,” he said. “It’s happy to go to cheaper locations, higher-risk locations, more remote locations than HPC and AI is.”
The revenue
It comes as Bitfarms posted a net loss of $46 million in Q3, compared to $24 million a year earlier, amounting to a loss of 8 cents per share, which fell short of analysts’ expectations of a 2-cent loss. The company’s revenue rose 156% year over year to $69 million, although it fell short of analyst expectations by more than 16%.
Bitfarms said in April that it had reached a preliminary agreement with Macquarie Equipment Capital for a private financing facility of up to $300 million.
The profits from the debt facility will be utilised to expand AI data centres. Interestingly, Bitfarms’ latest strategy comes as worldwide crypto miners confront challenges in being profitable.
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