HIVE Secures $220M GPU Contract to Shift Focus from Bitcoin Mining to AI Infrastructure

HIVE Digital Technologies has signed a pivotal three-year GPU cloud contract worth $220 million with Bell Canada and Toronto-based AI company Cohere. This deal involves the deployment of 2,304 NVIDIA Grace Blackwell graphics processing units (GPUs) at Bell's data center located in Merritt, British Columbia. The completion of the deployment is expected to generate approximately $70 million in new annual recurring revenue, which brings HIVE's total high-performance computing revenue contracts to over $100 million.

The stock of HIVE rose more than 7% on the Toronto Stock Exchange following the announcement, highlighting a definitive transition from traditional Bitcoin mining operations towards becoming a key player in the AI infrastructure sector. This shift aligns with Canada's broader strategy to bolster domestic AI capabilities, with Ottawa investing significantly in local AI compute resources through its Sovereign AI Compute Strategy.

The partnership with Cohere is particularly notable as the company builds large language model systems aimed at enterprises and government agencies. Such models require substantial computing resources, and this new contract provides the necessary infrastructure to support them. Cohere’s recent valuation surge due to its merger with Germany's Aleph Alpha further emphasizes its importance in the AI landscape.

As the demand for AI systems continues to grow, the focus on "sovereign AI"—which refers to AI systems that operate within a country’s borders on controlled local data—becomes increasingly relevant. HIVE’s contract is viewed as a critical physical layer in Canada's efforts to promote domestic AI technologies.