Bitcoin miner Hut 8 shares gain on revenue, outlook – despite Q2 profit slump
Crypto mining slump? Canada-based company booked 31% revenue growth on year, expanded Bitcoin holdings, and plans to ramp up mining capacity this year. Other crypto miners seem to be following suit.
Hut 8 mining facility in Alberta, Canada. Image: screenshot of Hut 8’s YouTube video
Bitcoin prices may have slumped for much of this year, but Hut 8 Mining Corp. saw its shares jump Thursday after it reported larger Bitcoin holdings just as the leading cryptocurrency seemed to be starting to track higher.
The shares closed up 9.23% at US$2.96 on Thursday on Nasdaq, while its Toronto-listed shares rose 9.2%, after the company said revenue grew 30.7% on year in the second quarter, driven by expanded mining and increased Bitcoin reserves.
“Our continued growth in digital asset mining operations and in our Bitcoin reserves, coupled with our first full quarter generating uncorrelated fiat revenue in our high performance computing business, has positioned us well to drive future success,” Jaime Leverton, chief executive officer of Hut 8, said in a statement.
Hut 8 said it installed 7,199 new mining rigs, ramping up its mining capacity to 2.78 exahashes per second at the end of June, a 9% increase from the end of March.
“Looking forward, we anticipate organically growing our mining capacity to approximately 3.55 exahashes by the end of 2022,” Leverton said in an earnings call on Thursday.
In a sign that more crypto miners are regaining confidence after the 65% slump in Bitcoin from a record high of US$68,790 last November, China-based Canaan, one of the world’s largest mining rig makers, told Forkast last month it plans to expand its self-mining business to the U.S. from Kazakhstan.
See related article: Chinese mining rig maker Canaan says global expansion on track despite ‘crypto winter’
The number picture
Hut 8 said Bitcoin reserves rose 14.6% to 7,406 Bitcoin in the second quarter from 6,460 in the first quarter of this year.
It booked C$43.8 million (US$34.4 million) in revenue, up from C$33.5 million in the same period last year, the earnings report showed. The company recorded a net loss of C$88.1 million compared to a loss of C$4 million in the same period in 2021.
Lower Bitcoin prices and increased power costs took a toll on mining profit, which shrank to C$14.9 million from C$19.3 million in 2021.
Many Bitcoin miners in the U.S. were forced to halt some operations amid heat waves over the past few months. Hut 8, which has three mining facilities in Alberta and Ontario, Canada, also faced higher electricity rates.
“We did have some peak power pricing during some of the hotter days. And when we see peak power pricing, we do power down,” Leverton said.
Shares in other North American Bitcoin miners followed the Hut 8 pattern.
Marathon Digital Holdings shares closed up 5.07% on Thursday after it posted a net loss of US$191.6 million in the second quarter compared with a net loss of US$108.9 million in the prior-year period, according to its latest earnings report.
Shares of U.S.-based miner Riot Blockchain, which delayed its earnings report, climbed 4.5%. Canaan shares were little changed, dipping 0.25%.
Timmy Shen is a Taipei-based journalist at Forkast. Previously, he wrote for Caixin Global and TechNode, covering topics ranging from fintech to fan economy. He also cares about LGBT+ issues and is a shabu shabu fanatic. Timmy holds an MS degree from Columbia Journalism School.
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