Phoenix Group is pushing deeper into artificial intelligence after a 43% revenue slide in 2025, signing French developer DC Max to build an 18-megawatt AI data center in Lyon, the first European deployment in what the Abu Dhabi-listed firm says will scale to more than one gigawatt of capacity.
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The Lyon facility is the inaugural site under what Phoenix is calling its European Data Center Platform, a partnership structured around DC Max's pipeline that the firms value at roughly $8 billion.
Phoenix said it has acquired the land, secured permits and lined up grid access, with construction set to begin in July 2026 and handover scheduled for the fourth quarter of 2027 or the first quarter of 2028.
The move follows a now-familiar playbook in the Bitcoin mining sector. Full-year revenue at Phoenix (ADX: PHX) fell to $117.7 million from $205.7 million the year before, while the firm reported a $271.7 million loss attributable to shareholders against a $167.4 million profit in 2024.
Like Wall Street peers Core Scientific, Riot Platforms and Bitfarms, Phoenix is steering its power-hungry infrastructure toward AI tenants willing to pay several times more per megawatt than current coin economics support.
From Mining Losses to AI Sites
The 2025 annual report Phoenix published last month showed the scale of the decline. Trading revenue dropped 69% year on year, hosting revenue fell 62% and self-mining revenue slipped 21%, dragging full-year revenue below $118 million.
Earnings per share swung from a profit of $0.028 to a loss of $0.045, with unrealized fair value losses of $223.3 million on digital asset holdings driving most of the bottom-line damage.
The pivot has been telegraphed in steps. Last summer, Phoenix unveiled a digital asset treasury holding Bitcoin and Solana, becoming the first ADX-listed company to formalize such a structure as an operational buffer against mining cash-flow volatility.
Around the same time, it disclosed internal recruitment for AI divisions and began scouting sites for AI and high-performance computing capacity. The Lyon deal turns that scouting into the company's first hard commitment outside the Gulf.
Co-founder and Group CEO Munaf Ali described the announcement as more than incremental, calling it "a genuine inflection point" for the firm. He added that "the 1GW ambition is not a ceiling; it is a starting point."
Bitcoin Miners Crowd Into AI Real Estate
The repositioning across the listed mining sector has accelerated through 2025 and into 2026 as post-halving margin pressure squeezed coin economics.
Analysts have estimated up to 20% of the industry's power capacity could be repurposed for AI and HPC by the end of 2027, with Goldman Sachs forecasting U.S. data center power demand to grow at a 15% compound annual rate through 2030.
Nasdaq-listed Core Scientific recently secured a financing facility from Morgan Stanley of up to $1 billion to fund its conversion from crypto mining to high-density colocation.
Riot Platforms appointed three new board members with data center and AI experience, including a former Meta executive. Bitfarms went further, renaming itself Keel Infrastructure and halting all new Bitcoin mining investment.
The financial logic is straightforward. Bitcoin miners typically trade at 6 to 12 times EBITDA, while data center operators trade between 20 and 25 times. A clean operational pivot, with long-term tenant contracts replacing volatile coin revenue, can support a meaningful multiple re-rating over time.
France Targets the Hyperscaler Backlog
Demand for AI compute in Europe has run ahead of supply, with hyperscalers and large enterprises booking capacity years in advance. Traditional new-build timelines of 36 to 48 months leave most operators struggling to keep pace.
Lyon offers several advantages for developers willing to move quickly. France's second-largest city has an industrial base, dense electrical infrastructure and land prices well below those around Paris, which has emerged as Europe's most contested data center market.
DC Max also brings existing permits and grid agreements on some of its sites, which Phoenix said allows it to compress the typical timeline.
"The demand is there. The sites are there," DC Max Chief Executive Romain Fremont said in a statement, adding that the tie-up gives the French developer access to capital and operational depth that would have been difficult to assemble alone.
A 1GW Ambition Meets Execution Risk
The Lyon site joins roughly 550 megawatts of capacity Phoenix already operates across the UAE, Oman, North America and Ethiopia, infrastructure originally built for Bitcoin mining and now being repositioned for AI and HPC workloads.
The firm also holds a 13.9% stake in Bitzero, a data-center-focused company that listed on the Canadian Securities Exchange last year, while Ali himself has been buying shares to back the pivot strategy.
DC Max, for its part, claims a roughly two-gigawatt portfolio and says it is backed by a group with more than β¬6 billion in investment experience.
Phoenix Group debuted on the ADX at the end of 2023, and since then its share price has fallen 60% to the current level of AED 0.90.
This article was written by Damian Chmiel at www.financemagnates.com.
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