In the second quarter of 2024, Toronto-based Bitcoin mining company Bitfarms reported a total revenue of $42 million, which marked a 16% decline quarter-over-quarter. This decrease was primarily attributed to the reduction in block rewards as a result of the BTC halving event that occurred on April 19, 2024. Additionally, Bitfarms reported a net loss of $27 million, or $0.07 per share, which included a $1 million non-cash expense for revaluing warrant liabilities from financing activities in 2021 and 2023. This was a significant change from the net loss of $6 million, or $0.02 per share, in Q1 2024, which included a $9 million non-cash gain from revaluing warrant liabilities.
Bitfarms generated 614 BTC in the second quarter of 2024 with an average direct production cost of $30,600 per BTC, a notable increase from $18,400 in the first quarter. The total cash cost per BTC also rose to $47,300 in the second quarter, compared to $27,900 in the first quarter, due to producing a lower quantity of BTC. Despite these challenges, July saw a 34% increase in Bitcoin earnings for the company, with 243 BTC valued at $14 million, showing improvement from the previous month.
Bitfarms’ Chief Financial Officer, Jeff Lucas, emphasized the company’s robust balance sheet and capital-efficient growth strategy, providing them with exceptional financial flexibility. He stated that their 2024 growth and efficiency improvement plans are fully funded, with sufficient liquidity for infrastructure buildout and miner procurements to achieve 21 EH/s and 21w/TH by year-end. CEO Ben Gagnon, who recently took on the role, highlighted the company’s ongoing expansion and diversification efforts. Bitfarms’ latest addition is a site in Sharon, PA, marking their initial entry into the PJM region. Gagnon expressed confidence in the PJM area, describing it as the most promising energy market in the US.
Despite their growth plans, Bitfarms is currently facing a hostile takeover attempt from competitor Riot Platforms. Riot Platforms had proposed a $950 million acquisition in April but later withdrew the offer, citing difficulties in negotiating with Bitfarms’ current board. This challenge adds another layer of complexity to Bitfarms’ financial situation and future prospects.
Bitfarms’ Q2 financial report paints a mixed picture of revenue decline, increased production costs, and Bitcoin earnings improvement. The company’s future plans for expansion and efficiency improvements show promise, but the looming threat of a hostile takeover adds uncertainty to their path forward. Only time will tell how Bitfarms navigates these challenges and continues to establish itself in the competitive Bitcoin mining industry.
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