HIVE Digital Technologies stock surged more than 7% on Thursday following the announcement of a $220 million GPU cloud contract with Bell Canada and the Toronto-based AI firm Cohere. This marks the company’s largest deal to date and signals a definitive shift for the Bitcoin miner into the AI infrastructure sector.
A Landmark Deal for AI Infrastructure
The three-year contract, to be executed through HIVE’s subsidiary BUZZ High Performance Computing, involves the deployment of 2,304 NVIDIA Grace Blackwell GPUs. These advanced chips, designed for cutting-edge AI model training and inference, will be installed at Bell’s purpose-built data center in Merritt, British Columbia.
Cohere, a prominent large language model company that develops AI systems for enterprises and governments, will leverage this compute power to operate its platform for Canadian clients.
The Rise of Sovereign AI
The concept of “sovereign AI”—AI operating on domestic infrastructure with locally controlled data—is gaining significant traction, particularly for government clients. Canada has been a strong proponent of this strategy, with Ottawa committing over $2 billion to domestic AI compute as part of its Sovereign AI Compute Strategy, including a direct $240 million investment in Cohere. This new contract represents the tangible realization of that national investment.
Cohere is a fitting partner for this initiative. The Toronto-based company is among a select group globally developing foundation models, the underlying AI technology powering enterprise chatbots, government document processing, and a wide array of other applications. Cohere recently announced a merger with Germany’s Aleph Alpha, valuing the combined entity at approximately $20 billion. The current contract builds upon an existing partnership between Bell and Cohere, which dates back to July 2025, by providing the essential compute infrastructure.
“Canada helped pioneer modern artificial intelligence. What we have lacked is not talent, it is industrial infrastructure to commercialize that talent at scale before others do it for us,” stated Frank Holmes, executive chairman at HIVE Digital Technologies. “This partnership with Bell and Cohere is a defining moment. BUZZ HPC is the GPU factory layer that transforms Canada’s AI ambitions from political promises into productive national assets.”
HIVE’s Strategic Pivot
For HIVE, which reported $278.3 million in Bitcoin mining revenue last quarter, this deal is a significant milestone in its strategic pivot that began in 2022. The company initiated its transition into AI by reallocating GPU capacity from crypto mining. This move was further bolstered by a deal with Dell for new GPUs last November and a $115 million convertible note offering in April to finance hardware acquisitions. HIVE is not alone in this transition; Keel Infrastructure, formerly Bitfarms, sold its last Paraguay mining facility in April and is pursuing a similar strategy.
The volatile nature of cryptocurrency mining returns, exacerbated by increasing competition and market downturns, contrasts sharply with the burgeoning demand for AI compute. Clients, especially government agencies, are increasingly opting for multi-year contracts with fixed rates. This shift represents a move from one potentially volatile market to another, but one that is underpinned by a clear government mandate.
Future Growth and Expansion
Upon deployment, expected between late 2026 and early 2027, HIVE anticipates generating approximately $70 million in new annual recurring revenue, in addition to the $35 million already secured from existing GPU operations. The company’s contracted HPC revenue target now surpasses $100 million.
Furthermore, HIVE is developing a larger project: a 320-megawatt AI data center in the Greater Toronto Area. This facility is designed to accommodate over 100,000 Nvidia GPUs at its full build-out. HIVE projects this facility will generate roughly $360 million in annualized recurring revenue once fully operational, with a broader target of $660 million in annualized HPC revenue by the end of 2028.
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