Target Hospitality wins $250M data center contract, raises 2026 outlook

Target Hospitality Corp. (Nasdaq: TH) announced a multi-year lease and services agreement to provide facility and hospitality services for a data center development project by a top-five hyperscaler in the Pecos region of West Texas, according to a company press release.

The contract is expected to generate approximately $250 million in revenue through August 2030. Target Hospitality will deliver accommodations and hospitality services to support approximately 1,100 individuals, with initial occupancy planned for the third quarter of 2026. The company said it plans to modify existing underutilized assets to complete the community, requiring less than $15 million in capital investment.

Including this contract, Target Hospitality said it has secured more than $1.7 billion in multi-year contract awards across its workforce hospitality solutions segment since January 2026.

The company raised its full-year 2026 financial outlook, now projecting total revenue of $435 million to $445 million and adjusted EBITDA of $105 million to $115 million. Total capital expenditures are expected to be between $490 million and $510 million, excluding acquisitions. The midpoint of the revenue outlook represents a 6% increase, while the adjusted EBITDA midpoint reflects a 22% increase from prior guidance.

Target Hospitality also said it anticipates annualized revenue exceeding $750 million and annualized adjusted EBITDA above $300 million exiting 2027, based on its existing contract portfolio and excluding any contribution from its commercial pipeline.

"This Contract adds another top-five hyperscaler to our expanding portfolio and highlights our ability to deliver flexible, speed-to-market solutions that address customers' complex operational needs," said Brad Archer, President and Chief Executive Officer.

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