0001213900-25-109964
SEC filingWhiteFiber's Q3 2025 net loss widened to $15.8M driven by a $18.0M surge in G&A expenses, primarily from share-based compensation, despite a 64% revenue increase to $20.2M.
For the three months ended September 30, 2025, WhiteFiber reported a net loss of $15.8 million, a significant decline from a net loss of $0.4 million in the prior-year period. This deterioration was primarily driven by a $18.0 million increase in general and administrative (G&A) expenses, which surged to $21.3 million. The primary driver of this increase was a $10.0 million rise in share-based compensation expenses, alongside higher professional and consulting fees and increased headcount following the company's IPO. Total revenue grew 64.3% year-over-year to $20.2 million, fueled by a 48.4% increase in cloud services revenue to $18.0 million and the addition of $1.7 million in colocation services revenue from the Enovum acquisition. However, this revenue growth was offset by a $2.0 million service credit issued to a cloud customer. Cost of revenue increased by $1.5 million, and depreciation and amortization rose by $2.0 million, contributing to a loss from operations of $14.5 million.
For the nine months ended September 30, 2025, the company reported a net loss of $23.2 million compared to net income of $2.4 million in the prior year. Revenue increased 68.3% to $55.6 million, but total operating expenses more than doubled to $77.2 million, driven by a $35.3 million increase in G&A expenses, which included $16.5 million in additional share-based compensation.
The company operates two reportable segments: Cloud Services and Colocation Services. Cloud services revenue, which provides GPU access for AI workloads, increased to $18.0 million in Q3 2025 from $12.2 million in Q3 2024. This growth was attributed to an increased number of deployed GPU servers for new and existing customers, though it was partially offset by a $2.0 million service credit. The cost of revenue for cloud services was $6.3 million, with GPU server lease expenses being the largest component at $3.5 million.
Colocation services, a new segment following the Q4 2024 acquisition of Enovum, generated $1.7 million in revenue for Q3 2025 with a cost of revenue of $0.7 million. This segment provides data center space, power, and cooling and represents a strategic diversification of the company's revenue base.
Management's outlook is focused on the timely completion and expansion of its data center projects. The MTL-3 facility in Montreal was substantially completed by October 2025 and began billing its anchor customer, Cerebras, on November 1, 2025, at a monthly rate of approximately $979 thousand over a five-year contract. The company expects its NC-1 facility in North Carolina to begin generating revenue in May 2026, with a second construction phase expected to be completed and revenue-generating in the second quarter of 2026. The company has put the MTL-2 build on hold to prioritize these other projects. Management also intends to pursue additional utility power allocations and deploy natural gas fuel cell technology to increase power capacity and revenue potential at its sites. The company believes its cash on hand and anticipated cash from operations will be sufficient to finance operations for at least the next twelve months.
WhiteFiber's balance sheet was fundamentally recapitalized during the period. Cash and cash equivalents soared to $166.5 million as of September 30, 2025, from $11.7 million at year-end 2024. This was primarily fueled by $144.5 million in net proceeds from its initial public offering and an additional $22.2 million from the full exercise of the underwriters' over-allotment option. The company also received $157.4 million in net transfers from its Parent, Bit Digital. Total assets expanded to $555.1 million, driven by a $154.9 million increase in property, plant, and equipment, net, reflecting aggressive investment in its HPC infrastructure. Shareholders' equity correspondingly increased to $481.1 million. The company carries no traditional debt on its balance sheet, though it has access to an undrawn $43.9 million credit facility.
The company has significant commitments tied to its expansion. A key contingent liability of up to $8 million is payable to the seller of the Madison, North Carolina property if the company secures an Electric Service Agreement for at least 99 megawatts (MW) within two years. A separate $43.9 million non-recourse credit agreement with the Royal Bank of Canada is in place to finance data center operations but remains undrawn pending satisfaction of certain conditions. Operationally, the company is bound by an Electric Service Agreement with Duke Energy for its Madison facility, which mandates a minimum monthly bill of $8,754 plus a monthly facilities charge of $11,405. Future minimum operating lease payments total $73.0 million, with $55.8 million due in 2030 and thereafter, reflecting long-term data center lease commitments.
Capital allocation was dominated by heavy investment in infrastructure. Purchases of and deposits for property, plant, and equipment totaled $146.5 million for the nine-month period, a dramatic increase from $6.2 million in the prior year. This was funded entirely by the $324.1 million in financing cash flows from the IPO and parent company transfers. The company did not repurchase shares or pay dividends. The $43.9 million RBC credit facility provides future debt capacity for its data center buildout.
The company operates two reportable segments. Cloud services, which provides GPU-based HPC from Iceland, generated $18.0 million in revenue for Q3 2025 with a segment gross profit of $11.7 million, driven by costs for electricity, datacenter leases, and GPU server leases. The newer colocation services segment, based in Canada, contributed $1.7 million in revenue and $1.0 million in gross profit. The colocation segment's goodwill of $19.8 million, stemming from the Enovum acquisition, is a significant balance sheet item allocated to this unit.
WhiteFiber's cash flow statement for the nine months ended September 30, 2025, reveals a company in a heavy investment phase, funded by its recent IPO and parent company support. The divergence between net loss and operating cash flow is stark. The company reported a net loss of $23.2M, but operating cash flow was an even deeper use of cash at -$23.8M. The primary driver of this cash consumption was a massive $23.0M decrease in deferred revenue, which completely offset non-cash add-backs like $15.3M in depreciation and $8.8M in share-based compensation. This suggests a significant drawdown of previously collected customer payments without a corresponding inflow of new prepayments, a critical working capital dynamic to monitor.
Capital expenditure intensity is extreme. Capex of $146.5M is more than six times the prior year's $6.2M, reflecting the buildout of HPC data center infrastructure. This capex was not funded by operations but entirely by financing activities. The company raised $166.7M in net proceeds from its IPO and over-allotment option exercise, supplemented by $157.4M in net transfers from its parent, Bit Digital. Free cash flow (operating cash flow less capex) is deeply negative, a necessary consequence of the growth strategy but one that creates complete dependence on external capital. No share repurchases or dividends were paid, as all available capital was directed toward asset acquisition and operations.