Crypto firms announce Q2 earnings as Riot reports 18.9% ownership in Bitfarms As bitcoin, ethereum and other cryptocurrencies get increasing attention from investors, Wall Street and its traditional banks continue to adjust to the shift. Catch up on this week's top stories highlighting the intersection of these old guard and new school areas of finance with this recap compiled by The Fly.
CRYPTO EARNINGS: On Wednesday, Bakkt Holdings (BKKT) reported a second quarter loss per share of ($2.67) on revenue of $509.9M, which compared to a loss per share of ($4.69) on revenue of $347.6M for the same period last year. "We continue to make solid progress against our three key strategic priorities," said CEO Andy Main. "Since last quarter, we have made significant strides in partnerships across traditional and digital assets to enable Bakkt's solutions, which offer deep liquidity and strong analytics, risk management, pricing, and trade matching engines." The company also guided to FY24 revenue of $2.568B-$2.827B, which includes gross crypto revenues of $2.515B-$2.77B. [read more]
Additionally on Wednesday, Stronghold Digital Mining (SDIG) reported a Q2 loss per share of ($1.25) on revenue of $19.1M, which compared to a loss per share of ($1.35) on revenue of $18.2M last year. Stronghold mined approximately 299 bitcoin during Q2 and generated $0.2M of energy revenue for a total of 302 bitcoin-equivalent during the quarter, which was down approximately 46% from the 561 bitcoin-equivalent production during Q1. The company added, "The formal strategic review process being conducted by Stronghold and its Board of Directors continues with the assistance of outside financial and legal advisors. To date, the company has received numerous bids for all or parts of the company. The company and its Board continue to consider a wide range of alternatives to maximize shareholder value, including, but not limited to, the sale of all or parts of the company, another strategic transaction involving some or all of the assets of the company, and strategic financing." [read more]
Greenidge Generation (GREE) also reported Q2 results on Wednesday, with a loss per share of (56c) on revenue of $13.1M, which compared to a loss per share of ($1.57) on revenue of $14.7M for the same period last year. CEO Jordan Kovler said, "The actions we took in the first half of 2024 created a strong foundation that positions Greenidge to grow efficiently moving forward as we continue to scale our business. This quarter, we followed through on our promises to significantly reduce SG&A, expand our power capacity and obtain and build new sites with low power where we can deploy our own miners. With increased access to capital and a robust operational footprint across the country, we see numerous paths ahead to increase shareholder value and to build on the new offerings we introduced this quarter." [read more]
Additionally on Wednesday, Gryphon Digital Mining (GRYP) reported a Q2 loss per share of (10c) on revenue of $5.5M, which compared to a loss per share of (18c) on revenue of $5.3M for the same period last year. The company mined approximately 84 and 187 bitcoin in the quarter ended June 30, 2024 and 2023, respectively. "Gryphon reached milestones in both hashrate and energy efficiency during the second quarter of 2024, setting new company records," said Rob Chang, CEO. "We set a new company record in quarterly hashrate of 899 PH/s in Q2/24, a 20% increase over Q2/23. We also achieved a record monthly performance in energy efficiency at 28.5 joules per terahash in June. Furthermore, Gryphon's industry-leading operational efficiency resulted in a Q2/24 breakeven cost per bitcoin of approximately $45,452." [read more]
MORE CRYPTO EARNINGS: On Tuesday, Hut 8 (HUT) reported a Q2 loss per share of (78c) on revenue of $35.2M, which compared to analyst estimates of a loss per share of (3c) on revenue of $64.39M. During the three months ended Q2, 279 bitcoin were mined, versus 740 bitcoin mined in 2Q23. "Our results this quarter reflect the ambitious restructuring program we set in motion six months ago," said Asher Genoot, CEO. "Despite the network halving, gross margins in our Digital Assets Mining segment rose to 46% for the three months ended June 30, 2024 from 34% in the prior year period. Restructuring and optimization initiatives, together with the energization of Salt Creek, enabled a 21% reduction in our energy cost per kilowatt-hour from $0.040 in Q1 2024 to $0.032 in Q2 2024. With our strengthened operating foundation and recent advancements in ASIC efficiencies, we believe that now is the right time to upgrade our fleet. We are also on track to commercialize our GPU-as-a-service vertical in the third quarter, further bolstering our compute-layer economics." [read more]
Following the report, H.C. Wainwright double upgraded Hut 8 to Buy from Sell with a price target of $13.50, up from $7.50. The analyst now believes the stock's risk/reward skews to the upside. Hut now has competitive blended average electricity costs after successfully completing its restructuring program and energizing its newest 63 MW facility in Texas during the quarter, the analyst said. The firm believes the company has the capital and infrastructure in place to purchase and deploy the latest-generation mining equipment "at an opportune time in the cycle." [read more]
On Tuesday, Bitcoin Depot (BTM) reported Q2 revenue of $163.1M, which compared to revenue of $197.5M for the same period last year. Net income was $4.4M in Q2, compared to a net loss of $4M for 2Q23. "We continued to build on our momentum in the second quarter, achieving notable sequential growth in revenue, net income, and Adjusted EBITDA," said Brandon Mintz, CEO. "Our success of having over 8,000 active Bitcoin ATMs five months ahead of schedule underscores our robust execution and positions us well for sustained growth. This achievement not only enhances our market presence but also drives our cash flow dynamics, as evidenced by the $10.1M in operational cash flow generated during the second quarter. With this strong foundation, we are well-positioned to expand our world-leading kiosk footprint and maximize profits for our shareholders." [read more]
On Monday, TeraWulf (WULF) reported a Q2 loss per share of (3c) on revenue of $35.57M, which compared to analyst estimates of a loss per share of (1c) on revenue of $35.44M. The company self-mined 699 bitcoin across the Lake Mariner and Nautilus Cryptomine facilities in Q2, which represented a 21.4% decrease relative to 2Q23. "TeraWulf's second-quarter results reflect our unwavering commitment to operational excellence and strategic growth. By completing the construction of Building 4 at Lake Mariner, advancing our AI and high-performance computing initiatives, and streamlining our capital structure, we have solidified our position as a leader in the industry. Our focus on low-cost, predominantly zero-carbon energy and efficient management has enabled us to achieve industry-leading profitability while positioning us to capitalize on emerging opportunities in the rapidly growing data center market," said Paul Prager, CEO. [read more]
Following earnings, Rosenblatt assumed coverage of TeraWulf with a Buy rating and $5 price target. The analyst believes the company's expansion from bitcoin mining data centers to include data center colocation is a strategic addition to its coverage of data centers. The firm said TeraWulf has made substantial progress in expanding its infrastructure, increasing total operational capacity to 245 MW with the completion of Building 4 at the Lake Mariner Facility. [read more]
On Monday, Bitdeer (BTDR) reported Q2 loss per share of (14c) on a revenue of $99.2M, which compared to analyst estimates of EPS of 0c on a revenue of $108.92M. "Our second quarter was marked by strong financial performance and significant progress across all our major initiatives," said Matt Kong, CBO. "We achieved these results despite significant growth in the global network hashrate and the April 2024 halving. This demonstrates the strength of our differentiated strategy, underpinned by Bitdeer's commitment to technology and innovation. For instance, our previous R&D investment in our cloud hashrate business contributed a gross profit of $7.3M with a nearly 60% gross margin in Q2 and helped us generate more revenue for the same amount of hashrate relative to our peers." [read more]
Following the report, Rosenblatt assumed coverage of Bitdeer Technologies with a Buy rating and $9 price target. The analyst believes the company's "evolving" application-specific integrated circuit strategy makes it an ideal addition to its coverage of semiconductors and other enablers of the next-generation data centers. Bitdeer's short-term outlook is clouded by operational inefficiencies and heightened competition following the April bitcoin halving, the analyst said. [read more]
RIOT REPORTS 18.9% OWNERSHIP IN BITFARMS: On Tuesday, Riot Platforms (RIOT) announced that it acquired ownership of 1M common shares of Bitfarms (BITF) representing approximately 0.22% of the issued and outstanding common Shares of the company. The purchased shares were acquired through normal course purchases on the Nasdaq Stock Market and other open market trades for a weighted average price of approximately $2.28 per share at a price range per share of approximately $2.20 to $2.34 for an aggregate amount equal to $2,280,800. Immediately prior to the acquisition, Riot beneficially owned 84,293,054 common shares, representing approximately 18.68% of the issued and outstanding common shares. Following completion, Riot beneficially owned 85,293,054 common shares, representing approximately 18.9% of the issued and outstanding common shares. On June 24, 2024, Riot announced that it has requisitioned a special meeting of shareholders at which Riot will seek to remove certain directors from the company's Board of Directors and replace them with independent director candidates. [read more]
COINBASE ANNOUNCES AVAILABILITY IN HAWAII: In a Tuesday blog post, Coinbase (COIN) announced that services are now available in Hawaii. Faryar Shirzad, chief policy officer, wrote, "With recent state regulatory changes paving the way, we can now bring our products and services to Hawaii and empower residents to participate in the crypto economy. For years, Hawaii residents have expressed a strong interest in crypto on Coinbase, the only publicly traded crypto exchange in the U.S., and we're excited to deliver on that promise today. From seamless trading features to secure asset protection, Coinbase provides the most trusted crypto products and services. With our entry into the state, Hawaii residents can now: Buy, sell, and manage crypto with ease: Whether brand new to crypto or an expert, Coinbase makes it easy and seamless to get started with and manage crypto. New Hawaii customers can get started in just a few minutes, and use the app to access hundreds of cryptocurrencies, set up recurring buys, earn rewards, track prices, and transfer assets internationally." [read more]
AULT'S SENTIUM MINES 552 BITCOIN IN 2024: Ault Alliance (AULT) announced Monday that its wholly owned subsidiary Sentinum, as of July 31, 2024, has mined 552 bitcoin in 2024 at the company's data centers in Michigan and Montana along with miners hosted by Core Scientific (CORZ). This achievement contributes to Sentinum's cumulative total of 2,894 Bitcoin mined since the inception of its operations. The company is actively exploring the potential availability of additional power in Montana to enhance Sentinum's operational capacity. Furthermore, the company is making strides in Michigan, where it plans to transform its existing data center into a hyperscale facility. Will Horne, CEO, said "We are dedicated to building our Michigan data center into a hyperscale facility. We are currently exploring opportunities to lease all 30 megawatts of capacity to customers, with some expressing long-term interest to lease significantly more MWs if we are able to expand the data center's capacity to 300 MWs. Combined with our data center in Montana, we believe we have the ability to significantly expand the number of MWs of power that may be available in the future. We see significant future value in our data center operations." [read more]
CRYPTO STOCK PLAYS: Publicly traded companies in the space include Bit Digital (BTBT), Coinbase, Core Scientific, Greenidge Generation, Marathon Digital (MARA), MicroStrategy (MSTR), Riot Platforms, Stronghold Digital Mining and TeraWulf.
PRICE ACTION: As of time of writing, bitcoin dropped about 4% this week to $58,165 in U.S. dollars, according to CoinDesk.
