Baseten locked three years of GPUs. WhiteFiber's convert holders carry the bill.

WhiteFiber's NC-1 campus in North Carolina moved from construction into active customer deployment in August: initial billing started, and the full 40 contracted megawatts were due to reach run-rate billing by the end of that month ². The tenant is Nscale and its investment-grade offtaker, signed for ten years at about $865 million ². The stock jumped 13% in pre-market trade on the earnings print ¹.

The buyers locked their capacity

Since May, WhiteFiber has signed new multiyear cloud agreements worth more than $540 million↗ over their initial terms: $165 million over three years with Baseten for 1,392 NVIDIA B300 GPUs in Ontario, $108 million with Prime Intellect for 576 VR200 GPUs in Canada, a five-year Paris-region deal above $160 million, and an $87.5 million Iceland deployment ²¹. Once fully deployed, the cloud portfolio is meant to exceed $200 million of annualized revenue ².

Baseten, the largest named buyer, is itself nearing capital at a $26 billion valuation, double what it was worth in June, and inference startups' margins run thin largely because the cost of compute stays high ⁶. Baseten's raise and WhiteFiber's 5% convertible are the same trade, signed from opposite sides of the desk.

The bridge between signing and billing is debt

The quarter those deals landed in billed $28.8 million, up 54% year over year and ahead of the $18 million consensus, for a net loss of $0.39 a share ¹². But $12.3 million of that revenue was a one-off, tied to a previously disclosed customer termination ². Strip it out and the quarter billed about $16.5 million, under the estimate: the beat was carried by a payment for a contract that ended, not by contracts running.

The convert stack dwarfs the billing

Capital expenditure ran $175.5 million in the same quarter, and debt stood at $321 million when it ended ⁵. On 21 August the company closed $310 million of 5% convertible notes due 2032↗ at a $33.84 conversion price, exchanging $198.2 million of its older 2031 notes for $118.5 million of cash and 6.3 million shares ³⁸⁹. About $342 million of converts now sit against less than $30 million of quarterly billed revenue ³.

The market priced the bill

Shares fell 25.8% to $20.09 the day the offering was announced↗ ⁴, and closed at $19.62 on 25 September, 42% below the new conversion price ⁷. Retail had flagged the earlier $230 million of converts within a day of the beat ¹. Ten of eleven analysts still hold buy-equivalent ratings, at an average target of $40.82 ⁷.

Prepayments carry part of the load

The build is not funded by equity alone. Deferred revenue reached $143 million, mostly customer prepayments for NC-1 and cloud deployments; adjusted EBITDA was positive at $5.5 million; and $83.2 million of project-level financing arrived during the quarter ². Management is in exclusivity with a lender consortium over secured NC-1 financing, which it says may not close on favorable terms or at all, and is pitching a managed-services model in which customers fund the hardware ². If the flywheel turns, customer cash carries the interval, not the share count.

What the third quarter decides

Q3 consensus sits at $31.28 million of revenue ⁷, the first reading on whether run-rate billing arrived. The Paris deployment was targeted for end-of-September service ². Watch the invoices, not the signings: whoever fronts the metal carries the risk until it is paid for, and here that is WhiteFiber's note holders, while Baseten and the other buyers farm the margin.