Terawulf Shares Plunge Despite Billion-Dollar Business Developments

Terawulf's stock suffered a significant downturn yesterday, closing 17.6% lower following the release of disappointing quarterly earnings. The weak profit figures failed to reassure investors, even as the company reported securing over $17 billion in long-term customer contracts alongside more than $5 billion in new financing arrangements.

Market experts maintained surprisingly positive outlooks despite the selling pressure. B. Riley raised its price target from $22 to $23 while reiterating a "Buy" recommendation. Roth/MKM followed suit, increasing its target from $24 to $26 with a similar purchase advisory. The consensus price target currently stands at $18.42 accompanied by a "Moderate Buy" rating.

Profitability Concerns Overshadow Revenue Growth

For the third quarter of 2025, Terawulf posted revenue of $50.6 million, representing an 87% year-over-year increase. However, this performance fell short of analyst projections calling for $56.27 million. More concerning were the earnings figures: the company reported an adjusted loss per share of 7 cents, significantly worse than the anticipated 4-cent loss. The GAAP loss per share of -$1.13 dramatically missed consensus estimates of -$0.04. The quarterly net loss expanded substantially to $455.05 million.

Should investors sell immediately? Or is it worth buying Terawulf?

Strategic Transformation Gains Momentum

The company is currently executing a fundamental strategic shift toward high-performance computing and AI infrastructure, which shows promising early results:
- The new HPC segment has already generated $7.2 million in leasing revenue
- Three 10-year contracts at the Lake Mariner Campus are expected to yield approximately $6.7 billion in leasing payments
- Google has provided $3.2 billion in credit support
- The Abernathy Joint Venture established 240 MW of HPC capacity

Whether Terawulf can meet expectations next quarter remains uncertain. While the company's strategic positioning within the booming AI market presents compelling opportunities, profitability concerns continue to weigh heavily on investor sentiment.