TeraWulf stock falls after New York pauses new data center permits

TeraWulf shares have dropped more than 7% after New York ordered a one-year pause on new environmental permits for large-scale data centers.

Summary

• TeraWulf shares fell more than 7% after New York paused new environmental permits for large data centers.
• The company said its Lake Mariner and Lake Hawkeye projects are not affected by the governor’s executive order.
• TeraWulf continues expanding its AI business after signing a 20 year Anthropic lease expected to generate about $19 billion in contracted revenue.

According to an executive order signed by New York Governor Kathy Hochul on Tuesday, the state will temporarily stop issuing new environmental permits for certain large data center projects while regulators prepare a statewide framework to assess their environmental impact.

The order gives the Department of Public Service up to one year to complete a Generic Environmental Impact Statement, which will establish standards for future data center developments. The governor’s office said the review will examine electricity demand, water use and quality, and air quality before the moratorium is lifted.

Alongside the executive order, Hochul said she is also pursuing legislation to remove sales tax exemptions currently available to large data centers across New York.

Investors reacted quickly to the announcement. TeraWulf’s Nasdaq-listed shares closed down 7.08% at $19.41 on Tuesday.

Despite the market reaction, TeraWulf said the order does not affect its existing operations or development timeline in the state.

Paul Prager, TeraWulf’s founder and chief executive officer, echoed that view in a post on X, saying the company is evaluating on-site power generation for the Lake Hawkeye project, which he said aligns with the governor’s priorities for new electricity generation.

AI business continues to expand

While its New York projects remain unchanged, TeraWulf continues to grow its artificial intelligence and high-performance computing business.

Last week, the company signed a 20-year lease agreement with Anthropic for its Justified Data campus in Hawesville, Kentucky. TeraWulf said the agreement is expected to generate about $19 billion in contracted revenue over its full term.

As crypto.news previously reported, the company is also preparing to raise about $3.5 billion through leveraged loans and high-yield bonds to finance construction of the Kentucky AI campus. Bloomberg reported that Morgan Stanley is expected to lead the financing, although final terms have not been announced.

According to TeraWulf, the Kentucky facility will support about 401 megawatts of critical computing capacity, with initial operations expected in the second half of 2027 and full deployment planned for early 2028.

The company’s latest financial results also show how its revenue mix is changing. During the first quarter of 2026, TeraWulf reported $21 million in high-performance computing lease revenue, exceeding digital asset mining revenue of just under $13 million for the first time. Total quarterly revenue stood at $34 million, compared with $34.4 million a year earlier.

TeraWulf has said its AI infrastructure business is designed to provide more predictable contracted income while continuing to use its existing power and data center assets developed during its bitcoin mining operations.