Target Hospitality secured a $250 million contract with a top-five hyperscaler (large cloud company with massive computing capacity) to house the construction and operations workforce for a new data center in West Texas. The agreement runs through August 2030, covers roughly 1,100 residents and requires less than $15 million in capital because the company will repurpose assets it already owns. Initial occupancy is targeted for the third quarter of 2026. Target Hospitality provides modular workforce accommodations (self-contained housing and services for remote workers), including lodging, dining and amenities. Following the announcement, it raised its full-year 2026 revenue guidance to $435 million-$445 million and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) guidance to $105 million-$115 million. If its current pipeline develops as expected by mid-2027, the company projects annualized revenue above $500 million and adjusted EBITDA above $160 million. Target Hospitality says it has secured more than $1.4 billion in new multi-year contracts since January 2026, including a separate agreement worth more than $550 million tied to a North Texas data center hub. Deutsche Bank upgraded the stock to Buy. The expansion highlights West Texas' cheap land, power infrastructure developed during the Permian Basin boom and relatively favorable permitting conditions, while also exposing Target Hospitality to concentration risk from AI data center construction and a small number of large clients. A slowdown in hyperscaler capital spending or delays caused by permitting, power-grid constraints or financing changes could compress the revenue pipeline.