Riot Platforms, a Bitcoin mining firm, reported a net income of $211.8 million for the first quarter of 2024, representing a 1,000% increase from the same period last year. Despite this impressive performance, the company fell short of analyst revenue estimates. Mining revenue experienced a significant 55.4% year-on-year surge, reaching $74.6 million, primarily due to a 131% increase in the price of Bitcoin. Total revenue amounted to $79.3 million, falling approximately 14% short of Zacks’ expectations. However, progress in net income and mining revenue was hindered by lower Bitcoin production and higher mining costs, influenced by an increase in Bitcoin’s network difficulty and hash rate. The company mined 1,364 BTC during Q1, down 36% from the previous year, with an average cost of $23,000 to mine 1 BTC, reflecting a 144% increase.
Riot Platforms recently announced plans for a new facility in Corsicana, Texas, which, once fully developed, is expected to become the largest dedicated Bitcoin mining facility globally. The company aims to increase its hash rate capacity from 12.4 exahashes per second (EH/s) to 31 EH/s by the end of the year, with further growth to 41 EH/s when the Corsicana facility is fully deployed in 2025. The long-term goal is to reach 100 EH/s by 2027. Despite the positive outlook, Riot’s share price declined by 2.87% on May 1, before rebounding slightly in after-hours trading. In 2023, the company achieved total revenues of $281 million, setting new records. Riot Platforms has joined the Texas Blockchain Council to sue the US Energy Information Administration, alleging unlawful data collection demands from the Bitcoin mining sector.
Bitcoin miners, including Riot Platforms, have been adjusting their operations following the halving event on April 20, which reduced mining rewards from 6.25 BTC to 3.125 BTC. This adjustment has implications for the outflow of Bitcoin from miners in the coming months. Markus Thielen of 10x Research estimates that miners could potentially liquidate around $5 billion worth of BTC post-halving. CoinShares analysis suggests that Riot, TeraWulf, and CleanSpark are among the companies best positioned to weather the impending storm. Riot Platforms holds the third-largest hash rate among miners, trailing behind Marathon Digital and Core Scientific. The company’s CEO expressed optimism about the Corsicana facility and the company’s growth trajectory, aiming for significant hash rate increases in the coming years.
Despite facing challenges such as lower Bitcoin production and higher mining costs, Riot Platforms reported impressive financial results for the first quarter of 2024. The company’s net income of $211.8 million represented a significant increase from the previous year, driven by a surge in mining revenue and the price of Bitcoin. Riot’s plans for expansion in Corsicana, Texas, indicate a commitment to growth and increasing hash rate capacity. The company’s participation in legal action against the US Energy Information Administration demonstrates a proactive approach to protecting its interests in the Bitcoin mining sector. Overall, Riot Platforms’ performance and growth trajectory position it favorably among Bitcoin miners, despite facing industry-wide challenges such as the halving event and increased competition.
