Riot Platforms posts a Q2 net loss of $84.4M, missing estimates due to soaring Bitcoin mining costs and increased expenses.
Riot Platforms, a prominent Bitcoin miner, reported a substantial Q2 net loss of $84.4 million, far exceeding estimates. This marks the company's first quarterly loss since Q4 2022, driven by escalating costs and expenses.
Key Points:
Quarterly Loss and Missed Estimates:
Riot reported a Q2 net loss of $84.4 million, or $0.32 per share, doubling the forecasted $0.16 per share loss.
This is the first quarterly loss since Q4 2022.
Increased Costs and Expenses:
Selling, general, and administrative expenses surged to $61.2 million, a $41.4 million increase from Q2 2023.
The cost to mine a Bitcoin soared by 340%, from $5,734 to $25,327, due to April's halving event and a 68% rise in the Bitcoin network hash rate.
Revenue and Production Decline:
Revenue fell 8.75% year-on-year to $70 million, missing Zacks' estimates.
Bitcoin mining production dropped 52% to 844 BTC in Q2, largely due to the halving event.
Increased Bitcoin Mining Revenue:
Despite production challenges, Bitcoin mining revenue increased by 12%, attributed to a near-100% rise in Bitcoin's price between June 30, 2023, and June 30, 2024.
Expansion and Acquisition Efforts:
Riot nearly doubled its installed hash rate to 22 EH/s in Q2 and aims to reach 36 EH/s by the end of 2024.
Riot intensified its acquisition strategy against rival Bitfarms, purchasing an additional 10 million shares but ultimately failed in a $950 million buyout attempt.
Riot Platforms faces significant challenges with rising costs and missed estimates, leading to its first quarterly loss since Q4 2022. Despite increased revenue from Bitcoin mining, the company's future growth hinges on managing expenses and successfully expanding its mining capacity.
Source: Cointelegraph
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