Investor demands Riot accelerate transition to AI, promising company growth to $21B

Riot Platforms has received a sharp warning from activist investor Starboard Value. In a letter to the company’s leadership, the fund said Riot “must act with a renewed sense of urgency” to capture the explosive growth of the AI-infrastructure market. According to Starboard, Riot’s potential in high-performance computing (AI/HPC) could add between $9B and $21B to the firm’s valuation – roughly four times its current market cap.

The investor stresses that Riot needs to complete its internal transformation: eliminate “distractions,” cut costs, and focus on executing its AI/HPC strategy. The company has already taken several steps – in January it signed a data-center hosting deal with AMD and sold about $200M in bitcoin, moves analysts say create financial room for accelerated expansion. Still, Starboard argues Riot is trailing competitors who are signing multibillion-dollar agreements with major tech firms.

Starboard notes that Riot’s sites in Corsicana and Rockdale offer unique advantages – access to low-cost power and scalable energy capacity – making them attractive to large AI clients. In the investor’s view, the stock’s weak performance stems from the slow pace of dealmaking. Accelerating execution, Starboard claims, could lift Riot’s share price from $15.49 to $53 – a 242% increase.

Despite the pressure, the market reacted positively: Riot’s shares rose nearly 6% on the day and more than 25% over the past six months. But Starboard warns that the window of opportunity is closing fast as competitors rapidly expand into AI. To maintain an edge, Riot must sign “larger and higher-quality deals” and fully restructure its operating model for the new market.