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Bit Digital(BTBT) - 2025 Q1 - Quarterly Report
BTBTBit Digital(BTBT)2025-05-15 20:02
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Acquisitions and Expansions - The company acquired Enovum Data Centers Corp on October 11, 2024, which includes a fully operational 4 MW Tier-3 data center hosting over 5,000 GPUs for 14 customers[234]. - A new 5 MW Tier-3 data center expansion project (MTL-2) near Montreal was acquired for CAD 33.5million(approximatelyUSD33.5 million (approximately USD 23.3 million), with an expected investment of USD 19.3milliontomeetTier−3standards,operationalbyQ32025[235].−Aleaseforanewdatacentersite(MTL−3)inSaint−Jerome,Quebec,wasexecutedwitha20−yeartermanddevelopmentcostsexpectedtototalapproximatelyUSD19.3 million to meet Tier-3 standards, operational by Q3 2025[235]. - A lease for a new data center site (MTL-3) in Saint-Jerome, Quebec, was executed with a 20-year term and development costs expected to total approximately USD 40 million, targeting completion by late Q3 2025[237]. Agreements and Contracts - The company entered a five-year colocation agreement with Cerebras Systems to provide 5 MW of data center infrastructure, expected to be fulfilled at MTL-3 or another site[236]. - The company signed a binding term sheet with a customer for 2,048 GPUs, targeting total revenue of approximately 150millionoverthreeyears,orabout150 million over three years, or about 50 million annually[242]. - A Master Services and Lease Agreement was finalized for 2,048 GPUs, with an estimated total contract value exceeding 50millioninannualizedrevenue[243].−Anewagreementwasenteredtosupplyanadditional464GPUsfor50 million in annualized revenue[243]. - A new agreement was entered to supply an additional 464 GPUs for 15 million of annualized revenue, with a deferred start date until August 20, 2025[245]. - A Master Service Agreement with Boosteroid Inc. was executed for 489 GPUs, projected to generate approximately 7.9millionincontractedvalue,withpotentialexpansionupto50,000serversworthapproximately7.9 million in contracted value, with potential expansion up to 50,000 servers worth approximately 700 million[246]. - The Company finalized a service agreement to supply cloud services worth more than 50millioninannualizedrevenues,withaninitialcontractfor2,048GPUs[371].−AMasterServicesAgreementwithDNAFundincludesaminimumpurchasecommitmentof32GPUsandatotalof576H200GPUsovera25−monthperiod,representinganaggregaterevenueopportunityofapproximately50 million in annualized revenues, with an initial contract for 2,048 GPUs[371]. - A Master Services Agreement with DNA Fund includes a minimum purchase commitment of 32 GPUs and a total of 576 H200 GPUs over a 25-month period, representing an aggregate revenue opportunity of approximately 20.2 million[375]. Mining Operations - The company commenced its bitcoin mining operations in February 2020 and has focused on accumulating digital assets for potential sale or exchange[257]. - The company has chosen to acquire miners on the spot market to mitigate long delivery lead times, aiming to mine bitcoins quickly given their fixed supply[258]. - The company deployed an additional 1,441 miners during Q1 2025, resulting in an active hash rate of approximately 1.5 EH/s[264]. - The total contracted hosting capacity with Coinmint increased to approximately 46 MW as of January 2024[270]. - The company entered into a Master Mining Services Agreement with Blockbreakers for 4 MW of additional mining capacity, bringing total contracted capacity with them to approximately 9 MW[266]. - The company has secured a strategic co-location agreement with Soluna Computing for up to 6.6 MW, with a profit share of 35%[280]. - The company has a co-mining agreement with Digihost, providing approximately 6.0 MW of capacity, with Digihost entitled to 30% of the net profit[273]. - The company has a loan agreement with GreenBlocks for up to 5milliontofinanceminerswithacapacityof8.25MWinIceland[274].−ThecompanyhasatotalcontractedhostingcapacitywithSolunaofapproximately17.6MWasofMarch31,2025[281].−ThecompanyhasenteredintohostingagreementswithA.R.T.DigitalHoldingsforatotalcapacityof19MW,withprofitsharesrangingfrom19.755 million to finance miners with a capacity of 8.25 MW in Iceland[274]. - The company has a total contracted hosting capacity with Soluna of approximately 17.6 MW as of March 31, 2025[281]. - The company has entered into hosting agreements with A.R.T. Digital Holdings for a total capacity of 19 MW, with profit shares ranging from 19.75% to 40%[283]. Financial Performance - For the three months ended March 31, 2025, the company recognized revenue of 7.8 million from bitcoin mining services, a decrease of 14.1millionor64.514.1 million or 64.5% compared to 21.9 million for the same period in 2024[294][303]. - Cloud services revenue increased by 6.8million,or83.96.8 million, or 83.9%, to 14.8 million for the three months ended March 31, 2025, compared to 8.1millionforthesameperiodin2024[296].−Thecompanygenerated8.1 million for the same period in 2024[296]. - The company generated 1.6 million in revenue from colocation services for the three months ended March 31, 2025, compared to 0forthesameperiodin2024[299].−ThenetlossforthethreemonthsendedMarch31,2025,was0 for the same period in 2024[299]. - The net loss for the three months ended March 31, 2025, was 57.7 million, compared to a net income of 50.1millionforthesameperiodin2024,reflectingavarianceof50.1 million for the same period in 2024, reflecting a variance of 107.8 million[294]. - The company reported a net loss of 57.7millionforthethreemonthsendedMarch31,2025,achangeof57.7 million for the three months ended March 31, 2025, a change of 107.8 million from a net income of 50.1millioninthesameperiodof2024[334].−AdjustedEBITDAforthethreemonthsendedMarch31,2025,was50.1 million in the same period of 2024[334]. - Adjusted EBITDA for the three months ended March 31, 2025, was (44.5) million, compared to 58.5millionforthesameperiodin2024,indicatingasignificantdeclineinoperationalperformance[361].−Thecompanyincurredalossof58.5 million for the same period in 2024, indicating a significant decline in operational performance[361]. - The company incurred a loss of 49.2 million on digital assets for the three months ended March 31, 2025, compared to a gain of 45.7millioninthesameperiodof2024[331].AssetManagement−Thecompany′stotalassetsdecreasedby45.7 million in the same period of 2024[331]. Asset Management - The company's total assets decreased by 52,999,090 to 485,248,574asofMarch31,2025,comparedto485,248,574 as of March 31, 2025, compared to 538,247,664 as of December 31, 2024[336]. - The company's cash and cash equivalents decreased by 37,646,324to37,646,324 to 57,555,011 as of March 31, 2025, compared to 95,201,335asofDecember31,2024[336].−Thebalanceofaccountsreceivabledecreasedto95,201,335 as of December 31, 2024[336]. - The balance of accounts receivable decreased to 2.5 million as of March 31, 2025, down from 5.3millionasofDecember31,2024,attributedtopaidinvoicesfromcustomers[339].−Thebalanceofdigitalassetsdecreasedby5.3 million as of December 31, 2024, attributed to paid invoices from customers[339]. - The balance of digital assets decreased by 82.3 million to XXmillionasofMarch31,2025,primarilyduetoexchangesofbitcoinsintocashandUSDC,andachangeinfairvalueofXX million as of March 31, 2025, primarily due to exchanges of bitcoins into cash and USDC, and a change in fair value of 49.2 million[342]. - The current and non-current portion of deferred revenue decreased to 21.2millionand21.2 million and 0.1 million, respectively, as of March 31, 2025, down from 30.8millionand30.8 million and 0.1 million as of December 31, 2024, reflecting a recognition of 11.1millioninrevenue[355].−Workingcapitaldecreasedto11.1 million in revenue[355]. - Working capital decreased to 139.8 million as of March 31, 2025, from 241.8millionasofDecember31,2024,reflectingareductioninliquidity[362].OperationalChangesandFutureOutlook−Thecompanyanticipateslong−termoperationalimprovementsdespitepotentialshort−termdecreasesinminingoutputduetostrategicchangesinhostingpartnerships[261].−Theabilitytogeneraterevenuefromdigitalassetproductionissubjecttovariousrisks,includingregulatoryandmarketvolatility[377].−Thecompanymayneedtoraiseadditionalcapitaltofundoperationsandpursueitsbusinessstrategy,whichcouldinvolverisksanduncertainties[376][377].−Thecompanyexpectstocontinuetoopportunisticallyinvestinminerstoincreaseitshashratecapacity[304].EthereumOperations−ThecompanyinitiatedEthereumstakingoperationsinthefourthquarterof2022andhassincetransitionedtopartnershipswithvariousserviceprovidersforstakingactivities[289][306].−Thecompanyhasceasedallliquidstakingactivitiesasofthefirstquarterof2024,reclaimingallstakedEthereum[308].−ForthethreemonthsendedMarch31,2025,thecompanyearned211.0ETHinnativestaking,resultinginrevenuesof241.8 million as of December 31, 2024, reflecting a reduction in liquidity[362]. Operational Changes and Future Outlook - The company anticipates long-term operational improvements despite potential short-term decreases in mining output due to strategic changes in hosting partnerships[261]. - The ability to generate revenue from digital asset production is subject to various risks, including regulatory and market volatility[377]. - The company may need to raise additional capital to fund operations and pursue its business strategy, which could involve risks and uncertainties[376][377]. - The company expects to continue to opportunistically invest in miners to increase its hash rate capacity[304]. Ethereum Operations - The company initiated Ethereum staking operations in the fourth quarter of 2022 and has since transitioned to partnerships with various service providers for staking activities[289][306]. - The company has ceased all liquid staking activities as of the first quarter of 2024, reclaiming all staked Ethereum[308]. - For the three months ended March 31, 2025, the company earned 211.0 ETH in native staking, resulting in revenues of 560,641, an increase of 239,398or74.5239,398 or 74.5% from 321,243 in the same period of 2024[310][312]. - The company's revenues from ETH liquid staking decreased by 4,503,or1004,503, or 100%, to nil due to the termination of liquid staking activities in the first quarter of 2024[313]. - The cost of revenue from the ETH staking business increased by $16,135, or 98%, driven by an increase in staked ETH from 3,008 ETH to 21,568 ETH[326].