Marathon(MARA)2024-08-02 00:38Financial Data and Key Metrics Changes - The company reported a net loss of 0.72 loss per diluted share, compared to a net loss of 0.07 loss per diluted share in the same quarter last year [22] - Revenue increased by 78% to 82 million in the second quarter of 2023, primarily driven by a 256 million, up from 1.4 billion as of June 30, 2024 [30] Business Line Data and Key Metrics Changes - The operational hash rate grew to 31.5 exahash, with a fleet efficiency of 23.5 joules per terahash [10][27] - The company produced an average of 22.9 Bitcoin each day during the quarter, down from 32.2 Bitcoin per day in the prior year period, resulting in a total production decrease of 868 Bitcoin [24] - Hosting revenues generated 148 million during the second quarter [23] - The company currently mines approximately 9% of the global hash rate and expects that Kaspa will consume only 1% of its energy capacity, highlighting diversification benefits [13] Company Strategy and Development Direction - The company aims to become a globally diversified entity leveraging digital asset compute to transform the energy industry and enable a speedier energy transformation [8] - The internal structure has been reorganized into three specialized business teams: Utility Scale Mining, Energy Harvesting, and Technology, to enhance accountability and accelerate growth [8][28] - The company is focused on achieving a hash rate target of 50 exahash and plans to continue diversifying its portfolio through initiatives like Kaspa mining and energy harvesting projects [13][15] Management's Comments on Operating Environment and Future Outlook - Management acknowledged operational challenges in the past quarters but expressed confidence in overcoming these issues and achieving the 50 exahash goal by year-end [38] - The company is optimistic about the long-term value of Bitcoin and plans to adopt a full HODL strategy, retaining all mined Bitcoin going forward [29][68] - Management believes that co-locating AI with Bitcoin mining presents synergistic opportunities, particularly in balancing energy loads [35] Other Important Information - The company raised $345 million from at-the-market equity sales, primarily intended for Bitcoin purchases, miners, and operating costs [31] - The company has begun using its own technology to improve operations, with plans to convert most sites to immersion cooling technology [19] Q&A Session Summary Question: Can you talk about your investment in Auradine and are you currently using any of their miners? - The company has disclosed orders and payments to Auradine for their 3 nanometer miners, which are expected to outperform competitors [39] Question: With the announcement of your 100% HODL strategy, how do you plan to fund continuing operations? - The company plans to utilize cash on the balance sheet and access capital markets, alongside high-margin initiatives like Kaspa to generate additional cash flows [40][41] Question: When can we expect more information on when ongoing initiatives will contribute to revenue and earnings? - The company is focused on developing resilient businesses with long-term growth potential, particularly in Energy Harvesting and Technology, which are expected to yield benefits over time [42][43] Question: Can you explain the operational issues faced in the last two quarters? - The issues were primarily due to transformer failures and transmission line maintenance, which have since been addressed, and the company is implementing strategies to prevent recurrence [46][48] Question: How do you evaluate the economics of mining versus edge work? - The company aims to be an infrastructure provider rather than an operator of AI, focusing on partnerships and technology sales in the AI space [50][52] Question: What are your thoughts on capital deployment among the various business units? - The company employs a matrix organization to streamline operations and capital allocation, focusing on operational efficiency and return on investment [56][58]