Hive Digital accelerates AI pivot with $100M HPC expansion — Cointelegraph exclusive

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Hive Digital Technologies (HIVE) is continuing its transformation from a pure-play crypto miner to a high-performance computing (HPC) services provider.

What began with a fleet of 400 GPUs managed by two employees is now scaling toward a $100 million annual revenue. The company is leveraging advanced AI chips, including Nvidia’s H100s and the forthcoming Blackwell GPUs, to drive this growth.

Co-founder and Executive Chairman Frank Holmes and CEO Aydin Kilic elaborated on Hive’s strategy in an exclusive interview with Cointelegraph at the Nasdaq Stock Exchange headquarters in New York City, where the company rang the closing bell on Thursday.

The executives detailed Hive’s ongoing diversification into AI. Like other miners, Hive identified AI as a potentially more profitable use of energy than Bitcoin (BTC) when measured in kilowatt-hours. This insight has led several crypto mining companies to incorporate AI processing into their infrastructure, especially to counter declining profitability following the 2024 halving.

According to Holmes, Hive was the first publicly traded miner to pivot into HPC in 2022. By the second quarter of 2023, HPC revenue appeared on the company’s income statement for the first time, and it has since grown to a $20 million annual run rate, with a goal of reaching $100 million by 2026.

Still, scaling HPC capacity must be approached carefully, given the ongoing “scramble for electricity and land,” said Kilic.

In response, Hive recently acquired a site near Pearson International Airport in Toronto, Canada, securing a strategic location capable of scaling up to 7.2 megawatts of HPC power.

The choice of Toronto was intentional as it places Hive at the heart of a robust pipeline of AI talent, including connections to the University of Toronto and Canada’s AI ecosystem.

Despite the capital shift, Hive has maintained positive gross mining margins every quarter, even during Bitcoin’s steep downturn in 2022. Kilic credits this to Hive’s tight operational structure and continued investment in hardware, achieving global energy efficiency as low as 17.5 joules per terahash (J/TH).

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Hive stock is still performing as a Bitcoin proxy

Despite Hive’s pivot into higher-margin markets like high-performance computing, its stock continues to behave like a Bitcoin proxy, limiting its valuation upside, according to Kilic and Holmes.

Following the company’s closing bell ceremony at Nasdaq, Hive shares posted a modest gain and have rebounded 31% over the past month. However, year-to-date, the stock remains down 27%, trading around $2.23 with a market capitalization of approximately $475 million.

Even with this volatility, analysts have largely issued positive coverage on Hive, signaling that the stock is undervalued at current levels. In February, H.C. Wainwright issued a “Buy” rating with a $10 price target. Recently, Canaccord Genuity reiterated its “Buy” rating, assigning a $9 target.

Rosenblatt Securities analyst Chris Brendler also sees upside, citing Hive’s expanding HPC footprint and growing operations in Paraguay.

As Cointelegraph reported, Hive acquired its Paraguay facility from Bitfarms in January for $85 million. Kilic later told Cointelegraph that Hive sees Paraguay as a long-term investment, touting the country’s low-cost hydro power, geopolitical stability and government support.

Bitcoin mining M&A activity on the rise

Although Hive has expanded beyond its original mandate as a Bitcoin miner, it still views BTC as a core long-term strategic asset.

Earlier this month, Hive announced it had doubled its daily Bitcoin production to over six BTC. According to Holmes, that figure is expected to double again to 12 BTC by Thanksgiving, representing roughly 3% of the global Bitcoin network.

In January, Cointelegraph reported that several miners were adopting a Bitcoin treasury strategy to capitalize on anticipated price appreciation, strengthen their balance sheets and hedge against currency risk. This trend emerged alongside a broader wave of industry consolidation that began in mid-2024, driven in part by post-halving economics and the pivot toward AI.

Since the second quarter of 2024, M&A transactions have increased steadily, according to data from Architecture Partners.

Among mining and staking firms, there were 10 transactions in the first quarter of 2025 valued at $188 million. In the quarter before that, eight transactions valued at $266 million were completed.

The most notable merger was finalized this month, with CoreWeave acquiring Core Scientific in an all-stock deal valued at $9 billion. The acquisition came more than a year after CoreWeave first expressed interest in the Bitcoin miner, whose board initially rejected the offer as undervalued.

Although CoreWeave was initially a crypto miner before transitioning to an AI infrastructure provider, its acquisition of Core Scientific doesn’t necessarily mean it’s returning to the mining industry.

In announcing the Core Scientific acquisition, CoreWeave signaled its intention to repurpose the miner’s assets for HPC or divest its crypto mining business entirely.

Other notable M&A deals in the mining industry include Marathon Digital’s acquisition of Generate Capital mining sites, Hut 8’s acquisition of Validus Power assets, CleanSpark’s takeover of GRIID Infrastructure and Bitfarms’ buyout of Stronghold Digital Mining.

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