QS Research · Michael Burry's Scion Capital analyst template · 2006
Riot Platforms, Inc. (RIOT)
As of 2026-11-08 · 12/15 boxes filled from SEC filings and market data
Conclusion: SHORT
Conviction medium · base case -49% · downside -66% · upside +18%
The market is paying 2.94x a shrinking book and 9.28x TTM sales for a company whose TTM operating income and net income to common are both -$1.42B, whose ROE is -66.7%, and whose four-year cycle (FY2022-FY2025) contains one profitable year and roughly -$1.11B of cumulative net loss to common. Normalized mid-cycle earnings are negative, so there is no positive EPS to capitalize; the only positive anchor is book, and book is eroding ($3.14B FY2024 to $2.13B at 2026-09-30) while cash of $669.1M falls short of $724.1M debt plus $33.0M leases. The bull story is real but forward-dated: 1,151 MW and ~$38B of contracted data-center revenue with ~$1.8B average annual rent at Corsicana, first big deliveries September 2027-July 2028, funded partly by $4M/IT MW tenant reimbursement and non-recourse project debt - none of it in today's P&L, and all of it already more than reflected at 2.94x book. I value the base at 1.5x book (~$8.52/share, -49%), the downside at 1.0x book (~$5.68, -66%), and the upside at 3.47x book (~$19.72, +18%) only if the contracted rent is delivered and the market keeps paying today's multiple; the asymmetry is to the downside, so this is a short.
Key numbers
- Share price: $16.71
- Market cap: $6.27B
- Latest financial period: TTM to Sep 30, 2026
- Revenue (TTM): $675.7M
- Price / book: 2.94x
The 15 boxes
- ✓ 1. Long-form business notes
Riot describes itself as a vertically integrated digital infrastructure company running two reportable segments — Bitcoin Mining and Engineering — across 700 MW of developed capacity at Rockdale, 400 MW at Corsicana (built toward ~1 GW) and ~137 MW in Kentucky, with mined output of 5,686 bitcoin in 2025 versus 4,828 in 2024. Revenue nearly tripled from $259.2M in FY2022 to $647.4M in FY2025, but operating income swung from -$512.7M (FY2022) to +$153.6M (FY2024) and back to -$622.2M (FY2025), with operating cash flow of -$572.9M in FY2025 against $201.4M of capex. The business has changed between the oldest and newest annual report on file only in the sense that the FY2020 business section source is a bare heading: the substantive change visible in the sources is the 2025-2026 pivot from pure mining to leasing power and shell capacity to non-mining tenants, starting with a January 2026 ten-year AMD lease for 25 MW at Rockdale. The FY2025 loss is an operating loss, not a one-off distortion of an otherwise profitable year.
- ✓ 2. Competitive advantage
No durable advantage is visible in the numbers: across the four XBRL years revenue rose every year ($259.2M FY2022 to $647.4M FY2025) while operating income was positive only once (+$153.6M FY2024, -$622.2M FY2025) and operating cash flow was negative in the two largest years (-$255.1M FY2024, -$572.9M FY2025). The company's own claimed advantages are physical and financial — a Dallas-Austin corridor energy portfolio, low-cost power, and in-house electrical engineering — not brand, network or switching costs, and it concedes that competitors in both mining and data centers may have greater financial resources and longer operating histories. Growth has been funded by shareholders (diluted shares 139.43M FY2022 to 340.72M FY2025). The shift into data centers puts it against larger, better-capitalized incumbents, which the 10-K itself lists as a newly added risk.
- ✓ 3. 10-Q takeaways
Q3 2026 revenue was essentially flat at $181.4M versus $180.2M in Q3 2025, as Data Center ($18.4M) and Engineering ($47.0M, up from $19.1M) offset Bitcoin Mining falling to $116.0M from $160.8M on a $70,855 average bitcoin price. Mining was underwater after depreciation at the coin level: Q3 2026 cost to mine including depreciation was $78,805, or 111.2% of the $70,855 production value per bitcoin mined (nine months 2026: 121.4% of $72,732). The balance sheet and story have shifted to leased data-center cash flow: $950.2M of cash and bitcoin at 9/30/26 after selling 20,264 bitcoin for ~$1.5B year-to-date and retiring the $200M credit facility, plus a November 2026 Corsicana lease with ~$28B total contract value and no equity issuance currently anticipated.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ○ 11. Impression of the shareholder letter
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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