Episode Details

Riot Platforms (RIOT) Q2 2026 — Q2 2026 (quarter ended June 30; the 10-Q cleared EDGAR 17:01 ET Monday August 10, AFTER the close, so Tuesday August 11 IS the reaction session: it OPENED +21.5 pct, fell back to USD19.34, and CLOSED +4.33 pct on 4.54x normal volume.) Riot Platforms signed 241 megawatts of AI data-centre leases worth USD9.8bn in seven months and issued zero new shares to pay for it. It sold 9,665 bitcoin instead - 3.16 coins for every one it mined, and 54 pct of the stack it began the year with. THE CALL: AVOID (3/5, MEDIUM - THE BULL CASE STILL CLEARS THE TAPE) — base-case value ~$11.47 vs ~$19.02 today. KEY METRICS: - CALL: AVOID, 3/5. Fair value USD11.47 vs the USD19.02 close, -39.7 pct. Three roads weighted 50/20/30: asset sum of the parts USD13.42, signed contracts and treasury only USD7.03, and a 2028 balance sheet rolled forward with the convertible's shares inside the count USD11.19. BEAR USD6.94, BULL USD21.44. - THE ANGLE - RIOT PROMISED NO NEW EQUITY, AND ON SHARES IT MEANT IT. Financing activities for the half were NEGATIVE USD2.9M; the at-the-market raised USD0 against USD123.9M in 1H25. Shares went 371.6M at Dec 31 to 378.0M at Jun 30 - all restricted stock - then FELL to 375.3M on the 10-Q cover at Aug 7. - SO THE EQUITY CAME OUT OF THE TREASURY. Note 5: 18,005 bitcoin on Jan 1, 3,060 mined, 9,665 SOLD for USD732.5M, 11,380 left. That is 3.16 coins sold per coin mined against 0.46x in 1H25. Riot's own deck calls BTC sales the primary funding source for the equity component of data-centre capex. - AND THE SECOND CURRENCY IS THE CONVERTIBLE. The 0.75 pct 2030 Notes - USD594.4M principal, USD14.86 conversion, 67.2767 shares per USD1,000 = 39.99M shares - became convertible at holder option in Q3 2026, and Riot intends to settle in stock. Fully diluted 415.2M, not the 375.3M on screens. - THE MINE STOPPED PAYING. Cost to mine one bitcoin INCLUDING miner depreciation was USD90,631 against USD71,667 of production value - 126.5 pct, versus 92.4 pct a year earlier. Segment cash gross profit USD34.5M, then USD64.6M of miner depreciation. Adjusted EBITDA -USD69.7M against +USD495.3M. - THE EPS MISS IS 84 PCT NON-CASH. GAAP -USD0.68 vs a -USD0.3033 bar. Basis proven: Q1 -1.44 plus Q2 -0.68 equals the filed six-month -2.12. Add back USD74.6M of bitcoin mark, USD28.0M impairment and USD8.4M derivative marks and it is -USD0.363, a 6-cent miss. Revenue BEAT by 12.9 pct. - LIQUIDITY: the deck shows USD1.21bn. Unencumbered is USD796.8M - 5,821 of 11,380 coins are pledged to Coinbase and USD77.5M of cash is restricted, a 34.4 pct haircut. A signed megawatt costs USD9.96M and is worth USD19.17M at a 9.5 pct rate; the tape pays USD7.50M for unsigned ones. What to watch: UP: a signed Corsicana lease at Rockdale economics, worth roughly USD9.80 a share of development profit; or the Morgan Stanley bridge converting to permanent investment-grade debt. DOWN: that USD573M facility matures December 31 2026, and another half at this pace takes the stack under 5,000 coins. Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision. Learn investing free in the Charged Alpha app: https://chargedalpha.com/app?source=youtube&ref=video Educational only. Not financial advice.