CleanSpark(CLSK) - 2024 Q3 - Quarterly Report

Financial Performance and Key Metrics - Cash and cash equivalents increased significantly to $126.1 million as of June 30, 2024, compared to$29.2 million as of September 30, 2023[14] - Bitcoin holdings surged to $413.0 million as of June 30, 2024, up from$56.2 million as of September 30, 2023[14] - Total assets grew to $1.48 billion as of June 30, 2024, compared to$761.6 million as of September 30, 2023[14] - Total stockholders' equity rose to $1.40 billion as of June 30, 2024, compared to$677.2 million as of September 30, 2023[15] - Accumulated deficit increased to $415.5 million as of June 30, 2024, from$332.6 million as of September 30, 2023[15] - Additional paid-in capital grew to $1.82 billion as of June 30, 2024, compared to$1.01 billion as of September 30, 2023[15] - Bitcoin mining revenue for Q2 2024 reached $104.1 million, a 129$45.4 million in Q2 2023[17] - Total revenues for Q2 2024 were $104.1 million, up 129$45.5 million in Q2 2023[17] - Net loss for Q2 2024 was $236.2 million, compared to a net loss of$14.2 million in Q2 2023[17] - Total costs and expenses for Q2 2024 were $353.2 million, a significant increase from$61.1 million in Q2 2023[17] - Impairment expense for fixed assets in Q2 2024 was $189.2 million, with no comparable expense in Q2 2023[17] - Weighted average common shares outstanding for Q2 2024 increased to 228.6 million, up from 114.8 million in Q2 2023[20] - Loss from continuing operations per common share for Q2 2024 was$(1.03), compared to $(0.12) in Q2 2023[20] - Total stockholders' equity as of June 30, 2024 was$1.4 billion, up from $677.2 million as of September 30, 2023[22] - Shares issued under equity offering, net of offering costs, totaled 72.5 million shares for$801.6 million during the nine months ended June 30, 2024[22] - Accumulated deficit as of June 30, 2024 was $(415.5) million, compared to$(332.6) million as of September 30, 2023[22] - Net loss for the nine months ended June 30, 2023, was $61.71 million, compared to a net loss of$83.60 million for the same period in 2024[25] - Bitcoin mining revenue, net, for the nine months ended June 30, 2023, was $115.66 million, compared to$289.69 million for the same period in 2024[25] - Total stockholders' equity as of June 30, 2023, was $603.65 million, up from$404.01 million as of September 30, 2022[24] - Net cash used in operating activities for the nine months ended June 30, 2023, was $17.68 million, compared to$150.98 million for the same period in 2024[25] - Payments on miners and mining equipment for the nine months ended June 30, 2023, were $165.51 million, compared to$428.70 million for the same period in 2024[25] - Proceeds from equity offerings, net, for the nine months ended June 30, 2023, were $233.38 million, compared to$780.04 million for the same period in 2024[26] - Cash, cash equivalents, and restricted cash at the end of the period on June 30, 2023, were $21.83 million, compared to$129.16 million on June 30, 2024[26] - Depreciation and amortization for the nine months ended June 30, 2023, was $62.53 million, compared to$102.76 million for the same period in 2024[25] - Stock-based compensation for the nine months ended June 30, 2023, was $17.57 million, compared to$22.70 million for the same period in 2024[25] - Net cash provided by financing activities for the nine months ended June 30, 2023, was $222.71 million, compared to$754.62 million for the same period in 2024[26] - The company generated a net income from continuing operations of $83,598 during the nine months ended June 30, 2024[34] - The company sold$42,803 of bitcoin during the nine months ended June 30, 2024, to fund its operations[34] - The company believes it has sufficient cash and bitcoin to support its ongoing operations for the next twelve months[34] - The company early adopted ASC 350-60, resulting in a $4,183 cumulative-effect change to adjust its bitcoin holdings as of October 1, 2023[30] - The company's mining pool fees were 0.16$3,023, held in a separate bank account as collateral for insurance carriers[43] - Accounts receivable, net, was $5 as of September 30, 2023, down from$353 gross after a provision for doubtful allowances of $348[45] - Inventory increased to$1,538 as of June 30, 2024, from $809 as of September 30, 2023, primarily for bitcoin mining supplies[46] - Prepaid expenses rose to$3,031 as of June 30, 2024, from $2,434 as of September 30, 2023[47] - Cash balances exceeded FDIC limits by$2,871 as of June 30, 2024, down from $28,965 as of September 30, 2023[48] - The company recorded an impairment expense of$189,235 on certain miners during the three and nine months ended June 30, 2024[55] - Bitcoin is now measured at fair value as of each reporting period, with changes reflected in the consolidated statements of operations[56] - Bitcoin sales proceeds for the nine months ended June 30, 2024 were classified as investing activities, totaling $413,033 thousand[57] - The fair value of Bitcoin held by the company as of June 30, 2024 was$413,033 thousand, classified as Level 1 in the fair value hierarchy[59] - Total investments decreased from $3,423 million as of September 30, 2023, to$2,506 million as of June 30, 2024[81] - Fair value of investment in Debt Securities increased from $726 million to$812 million as of June 30, 2024[81] - Total fair value of investment in derivative assets decreased from $2,697 million to$1,692 million as of June 30, 2024[81] - Unrealized loss on derivative assets was $1,005 million for the nine months ended June 30, 2024, compared to$1,110 million for the same period in 2023[82] - Property and equipment increased from $734.9 million to$1,018.4 million as of June 30, 2024, primarily due to the addition of miners worth $238.7 million[84][85] - The company recorded an impairment charge of$189.2 million for miners planned for replacement[84] - Total depreciation expense for the nine months ended June 30, 2024, was $101.2 million, compared to$60.9 million for the same period in 2023[84] - Intangible assets increased from $10.3 million to$10.8 million as of June 30, 2024, with amortization expense of $1.6 million for the nine months ended June 30, 2024[87] - The company entered into a new operating land lease in Dalton, GA, for$18 per year for five years, recording a right of use asset and operating lease liability of $122[89] - Operating lease costs for the nine months ended June 30, 2024, were$140 million, compared to $221 million for the same period in 2023[90] - Total loans outstanding as of June 30, 2024, were$10,979 thousand, with a current portion of $9,665 thousand and a long-term portion of$1,314 thousand[94] - The company's income tax benefit for the three months ended June 30, 2024, was $9,495, with an effective tax rate of 3.9$801,611 during the nine months ended June 30, 2024[103] - The company's effective income tax rate for the nine months ended June 30, 2024, was (4.4%), primarily due to maintaining a valuation allowance on deferred tax assets[100] - The company's total principal payments on loans during the nine months ended June 30, 2024, were $5,296 thousand[93] - The company's Master Equipment Financing Agreement provided for up to$35,000 thousand of borrowings, with $20,000 thousand received at closing[97] - The company's income tax expense for the nine months ended June 30, 2024, was$3,499[100] - The company's authorized capital stock consists of 300,000,000 shares of common stock and 10,000,000 shares of preferred stock, with 235,525,077 shares of common stock issued and outstanding as of June 30, 2024[101] - The company's total principal amount of loan payments by fiscal year is $11,075 thousand, with$1,888 thousand due in FY 2024 and $7,969 thousand due in FY 2025[95] - The company's outstanding warrants as of June 30, 2024, have a weighted average exercise price of$6.12, with 17,560 shares exercisable[105] - Stock options outstanding as of June 30, 2024, totaled 2,249,920 shares with a weighted average exercise price of $15.48[107] - The Company granted 495,525 stock options during the nine months ended June 30, 2024, with a total fair value of$6,639[107] - Restricted stock units (RSUs) outstanding as of June 30, 2024, were 2,070,496 shares with a weighted average fair value of $5.99 per share[110] - The Company recognized$18,072 in stock-based compensation expense related to RSUs for the nine months ended June 30, 2024[111] - Open purchase commitments for bitcoin miners as of June 30, 2024, amounted to $232,822, including 22,050, 60,000, and 100,000 Antminer S21 and S21 Pro machines[112] - The Company entered into a$165,000 contract for mobile data centers in June 2024, with a firm commitment of $66,000 for phase 1[113] - The Company has open construction commitments of$8,791 related to new mining locations and operational facilities[115] - Total contractual future payments as of June 30, 2024, amounted to $331,858, including$204,179 for the remainder of fiscal year 2024[116] - The Company is involved in a class action lawsuit alleging material misstatements and omissions regarding its acquisition of ATL and bitcoin mining expansion[118] - The Company is defending against a consolidated derivative action alleging breach of fiduciary duties and other claims, with a stay in place until August 9, 2024[120] - The company completed the acquisition of Parcel 2 for $11.25 million and purchased adjacent land for$1.5 million, totaling $12.75 million for bitcoin mining development[127] - The company entered into a Future Sales and Purchase Agreement with Bitmain for 26,000 S21 XP Immersion servers at a total purchase price of$167.7 million, with a call option for an additional 50,000 units at $322.5 million[128] - The company issued 9,922,456 shares under its March 2024 ATM Amendment offering facility, resulting in net proceeds of approximately$214.2 million[129] - The company operates a total developed power capacity of approximately 520 MW across 12 data centers in Georgia and Mississippi, with an additional 50 MW pending commissioning and 15 MW under development[130] - As of June 30, 2024, the company held 6,590 bitcoins, with 99.8% in cold storage and 0.2% in hot wallets, valued at $413.03 million[137] - The company's operating mining units produced over 20.4 EH/s of computing power as of June 30, 2024, with a peak of 21.2 EH/s by July 31, 2024[132] - The company amended and restated the GRIID Credit Agreement to include a new delayed draw term loan facility of$40 million, with an interest rate of 8.5% per annum[125] - The company signed a Master Loan Agreement with Coinbase for a line of credit to borrow USD collateralized with bitcoin[126] - The company had one mining pool operator, Foundry Digital, representing 100% of revenue for the nine months ended June 30, 2024 and 2023[123] - Bitmain Technologies supplied 100% of the company's miners for the nine months ended June 30, 2024, compared to 54% in the same period in 2023[124] - The company's global hashrate increased to 558.0 EH/s as of June 30, 2024, up from 397.8 EH/s in 2023, representing a significant growth in computational power[140] - CleanSpark's hashrate reached 20.4 EH/s as of June 30, 2024, accounting for 3.66% of the total global hashrate, up from 1.68% in 2023[140] - The company mined approximately 14-16 bitcoin per day as of June 30, 2024, excluding transaction fees, representing a proportional share of global blockchain rewards[141] - The cost to mine one bitcoin in owned facilities was $26,945 for the three months ended June 30, 2024, up from$11,467 in the same period in 2023[142] - Total bitcoin mined at owned facilities reached 1,435 for the three months ended June 30, 2024, compared to 1,222 in the same period in 2023[145] - Bitcoin mining revenue from owned facilities was $94.7 million for the three months ended June 30, 2024, up from$34.2 million in the same period in 2023[145] - Energy costs represented 40.7% of bitcoin mining revenues for the three months ended June 30, 2024, consistent with 40.6% in the same period in 2023[147] - The company's miner efficiency improved to 22.3 w/th as of June 30, 2024, compared to 29.9 w/th in 2023, reflecting enhanced energy efficiency[140] - The average power price paid in owned facilities was $0.048 per KWH for the three months ended June 30, 2024, up from$0.041 in the same period in 2023[147] - The company recorded accelerated depreciation of $5,060 per bitcoin for the three months ended June 30, 2024, due to a reduction in the estimated useful life of certain miners[147] - Average revenue per bitcoin mined increased to$66,048 for the three months ended June 30, 2024, compared to $27,982 for the same period in 2023[150] - Bitcoin mining revenue for the three months ended June 30, 2024, was$104.1 million, a 129% increase from $45.4 million in the same period in 2023[152] - The company mined 1,580 bitcoin in Q2 2024, a slight decrease from 1,623 bitcoin in Q2 2023, but the average bitcoin price increased to$65,904 from $27,982[152] - Total miners in operation increased by 124$40.2 million in Q2 2024, up 89% from $21.3 million in Q2 2023, due to accelerated depreciation on older miners[164] - The company incurred a loss on the fair value of bitcoin of$48.3 million in Q2 2024, driven by a decrease in bitcoin price from $71,291 to$62,675[160] - Energy costs for mining operations increased by 178% to $38.5 million in Q2 2024, compared to$13.9 million in Q2 2023, due to higher miner volumes[154] - The company modified its contract to purchase 100,000 Antminer S21 Pro miners, with delivery expected through the remainder of 2024[164] - Net loss from continuing operations for the three months ended June 30, 2024 was $236,242, compared to$14,117 for the same period in