Key Points
- Riot Platforms’ Q2 losses increased to $84.4 million due to rising operational costs and the impact of the Bitcoin halving event.
- The company has purchased an additional 10 million shares of Bitfarms, intensifying its acquisition strategy.
Riot Platforms, a US-based Bitcoin miner, posted its Q2 financials, revealing a net loss of $84.4 million. This increase in losses was largely due to the Bitcoin halving event in April, which halved miner rewards and increased mining costs. The loss per share was $0.32, double the predicted $0.16 per share.
The Q2 2024 loss is nearly triple the $27.4 million loss reported in Q2 2023. The main reason for this increase is the sale of Bitcoin holdings to cover operational costs, and other general and administrative costs totaling $61.2 million, a threefold increase from Q2 2023.
Revenue and Bitcoin Production
Riot Platforms reported Q2 revenue of $70 million, a decrease of 8.75% from the previous year. Despite a drop in engineering revenue, Bitcoin mining revenue increased during the last quarter.
The company also reported a 52% decrease in Bitcoin production, falling to 844 BTC from 1,775 BTC quarter over quarter. The halving event and increased network difficulty resulted in a rise in the average direct cost to mine Bitcoin, which increased to $25,327 from $5,734 per Bitcoin in the second quarter of 2023. Riot also doubled its hashrate to 22 EH/s and expects its self-mining hashrate to surge to 36 EH/s by the end of 2024.
Riot reported $13.9 million in power credits for the quarter, including $4.4 million from demand response programs, which helped lower its average energy cost.
Bitfarms Acquisition Strategy
According to a July 31 filing with the US Securities and Exchange Commission (SEC), Riot has intensified its Bitfarms acquisition strategy by purchasing an additional 10 million shares of the firm. Earlier this year, Riot Platforms attempted a hostile takeover of Bitfarms, which was not entirely successful.
In mid-June 2024, Riot planned a $950 million buyout of Bitfarms, but later conceded defeat. The company stated that engaging with the incumbent Bitfarms Board on a potential combination was not possible.
Riot CEO Jason Les also discussed other company achievements in the Q2 report, such as the energization of its second large-scale facility in Corsicana, Texas. The company plans to make two more buildings operational by the end of 2024.
In July, Riot Platforms expanded its growth pipeline with the acquisition of Kentucky-based Block Mining Inc. This acquisition added 60 MW of power capacity across two facilities, with the potential to expand to over 300 MW by the end of 2025.
Following the Q2 report, the RIOT share price dropped another 1.18%. While other Bitcoin mining firms like CleanSpark have seen increases in 2024, the RIOT stock has been under selling pressure.
