Company Performance - Cipher Mining Inc. reported quarterly earnings of $0.06 per share, exceeding the Zacks Consensus Estimate of a loss of $0.10 per share, and showing an increase from earnings of $0.05 per share a year ago, representing an earnings surprise of 160% [1] - The company posted revenues of $42.22 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 7.77%, although this is a decrease from year-ago revenues of $43.42 million [2] - Over the last four quarters, Cipher Mining has surpassed consensus EPS estimates two times and topped consensus revenue estimates just once [2] Stock Outlook - The stock has gained approximately 7% since the beginning of the year, outperforming the S&P 500's gain of 1.7% [3] - The current consensus EPS estimate for the upcoming quarter is -$0.07 on revenues of $46.04 million, and for the current fiscal year, it is -$0.20 on revenues of $284.7 million [7] - The estimate revisions trend for Cipher Mining is currently favorable, leading to a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] Industry Context - The Technology Services industry, to which Cipher Mining belongs, is currently in the top 31% of over 250 Zacks industries, suggesting a positive outlook for stocks within this sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Operations and Facilities - The company operates approximately 327 MW of facilities across four bitcoin mining data centers in Texas, with a pipeline of approximately 2.8 GW across seven additional sites[26]. - As of January 31, 2025, the company has an aggregate hashrate capacity of approximately 15.7 EH/s, with plans to deploy an additional 150 MW for a total of approximately 477 MW by the end of 2025, targeting a hashrate of at least 25.2 EH/s[27]. - The Odessa Facility, the largest operational data center, has a capacity of 207 MW and is capable of producing approximately 11.3 EH/s of hashrate capacity[28]. - The Alborz Facility has a capacity of 40 MW and is powered solely by a nearby wind farm, with a hashrate of approximately 1.3 EH/s, of which the company owns approximately 0.64 EH/s[30]. - The Bear and Chief Facilities were expanded from 10 MW to 40 MW in 2024, each capable of hashing at a rate of approximately 1.6 EH/s, with potential expansions up to 115 MW[33][35]. - The Black Pearl Facility is expected to energize a 300 MW substation in Q2 2025, with an initial bitcoin mining capacity of up to 150 MW[37]. - The company has acquired the right to purchase three additional sites in Texas, each with a targeted capacity of up to 500 MW, to be exercised within the next 24 months[41]. - As of January 31, 2025, the company has deployed approximately 327 MW of electrical capacity across four data centers, achieving a hashrate of approximately 15.7 EH/s, with plans to increase total capacity to approximately 477 MW and a hashrate of at least 25.2 EH/s by the end of 2025[68]. Revenue and Business Model - The company derives revenue from mining bitcoin, contributing computing power to mining pools in exchange for block rewards and transaction fees[51]. - The company utilizes third-party mining pools to mine bitcoin, sending its hashrate to these pools in exchange for a share of the bitcoin mined[76]. - The company's business model requires that the costs of bitcoin mining remain lower than the price of bitcoin for operations to be viable[112]. - The company's revenue is highly dependent on the volatile nature of bitcoin and the broader cryptocurrency ecosystem, leading to significant fluctuations in operating results[200][201]. Regulatory Environment - The regulatory environment for blockchain and cryptocurrency businesses is evolving, with potential new laws and regulations from the SEC and CFTC impacting operations[82]. - In 2025, Texas legislation introduced minimum transmission rates for large loads to support grid reliability, which may increase operational costs for data centers[82]. - The establishment of a new working group within the National Economic Council may lead to significant changes in the regulatory framework for digital assets[82]. - Government scrutiny regarding the energy consumption of bitcoin mining is increasing, with proposed legislation requiring analysis of energy usage and emissions[115]. - The company is committed to maintaining proactive regulatory compliance, monitoring legislative developments, and engaging with stakeholders to align its practices with the evolving regulatory framework[81]. - The evolving regulatory landscape may introduce compliance challenges that could materially affect the company's operations and profitability[174]. - Increased regulation may lead to higher compliance costs for the company, impacting its operations and financial results[173]. - The company may incur significant compliance costs if deemed a "money services business" under FinCEN regulations, which could negatively affect its business[183]. - The CFTC classifies bitcoin as a commodity, and any regulatory changes could impose additional compliance obligations and costs on the company[186]. - If the company is deemed a "commodity pool operator," it may face increased expenses and regulatory scrutiny, adversely impacting shareholder investments[188]. - Future regulatory developments could significantly restrict the market for bitcoin, impacting the company's business model and financial condition[177]. - The company intends to maintain its operations to avoid being classified as an investment company under the Investment Company Act of 1940[178]. - The company is subject to compliance with OFAC sanctions, which may increase operational costs and affect transaction fees due to the pseudonymous nature of blockchain transactions[193]. Market and Competitive Landscape - The company operates in a highly competitive cryptocurrency industry, facing challenges from competitors with greater financial resources and less regulatory oversight[157]. - The global network hashrate is increasing, necessitating the acquisition of new miners to remain competitive in bitcoin mining[97]. - The company faces risks related to the volatility of the digital asset markets, including potential financing risks and legal proceedings[102]. - The company may experience increased mining costs that could exceed mining revenues, adversely impacting profitability[160]. - The emergence of alternative digital assets and central bank digital currencies (CBDCs) could negatively impact the price of bitcoin, affecting the company's business[169]. - The company anticipates potential increases in mergers and acquisitions (M&A) activity within the industry due to regulatory changes and market dynamics[158]. Operational Risks - The company may experience operational impacts due to extreme weather conditions affecting energy prices and mining efficiency[86]. - The company is exposed to severe weather conditions and natural disasters in Texas, which could disrupt operations and adversely affect financial results[125]. - The company faces potential delays in operations due to new regulatory processes implemented by ERCOT, affecting the energization of facilities[114]. - The company is particularly vulnerable to supply chain disruptions for critical materials like neon gas and palladium, which are essential for semiconductor manufacturing[108]. - Increased tariffs and trade restrictions on imported miners could lead to higher costs and delays in obtaining necessary equipment[106]. - The company relies on third-party electric utility providers and manufacturers for critical equipment, which may be subject to price fluctuations and shortages[120]. - The company may need to raise additional capital for expansion or technological advancements, which may not be available on favorable terms[163]. - The company faces challenges in attracting and retaining qualified personnel in the competitive cryptocurrency industry, which could hinder its growth prospects[140]. - The company’s growth depends significantly on the skills and services of its management team, and the loss of key personnel could adversely affect its business[138]. Cybersecurity and Data Risks - Cybersecurity threats pose significant risks, with potential impacts on operations and the security of digital assets[129]. - The company has not experienced a material cybersecurity incident to date, but acknowledges the potential for future incidents that could harm its reputation and financial condition[132]. - The company does not currently hold cybersecurity insurance, which could result in unrecoverable costs in the event of a cybersecurity incident[137]. - The company relies on custodians for bitcoin storage, primarily using Coinbase Prime, Anchorage Digital Bank N.A., and Fidelity Digital Assets Services, but faces risks related to potential bankruptcy of these custodians[135]. - The company’s bitcoin assets are subject to cybersecurity risks, and there may be inadequate recovery options if assets are lost or stolen[164]. - The company faces risks related to the inadvertent disclosure of confidential information, which could adversely affect its reputation and financial condition[156]. - The company relies on third-party service providers for IT systems, which poses risks of security breaches that could disrupt operations and affect financial performance[155]. Environmental and Compliance Risks - The company faces potential adverse effects on its brand and financial position due to changing environmental regulations impacting high energy-demand industries like bitcoin mining and HPC[190]. - Increased climate change regulations could lead to significantly higher energy costs, potentially putting the company's facilities at a competitive disadvantage[191]. - The company cannot predict the financial impact of future climate change legislation, which may harm its reputation and operational performance[192]. - Unanticipated changes in effective tax rates or adverse outcomes from tax audits could negatively impact the company's financial condition[194][195]. - The evolving treatment of digital assets for tax purposes introduces uncertainty that could adversely affect the company's business operations[196][198]. Bitcoin Market Dynamics - The market price of bitcoin ranged from approximately $38,501 to $108,389 during the fiscal year ended December 31, 2024, and from $16,490 to $45,000 during the fiscal year ended December 31, 2023, indicating significant volatility in bitcoin prices[133]. - A decline in the acceptance of cryptocurrencies could materially adversely affect the value of bitcoin and the company's business prospects[211]. - Ownership of bitcoin is pseudonymous, and significant holders may engage in large-scale sales that could negatively impact the cryptocurrency market and the company's stock price[212]. - The acceptance of cryptocurrencies, particularly bitcoin, in retail and commercial markets remains limited, contributing to price volatility[210]. Bitcoin Network and Development Risks - The Bitcoin network operates on an open-source protocol maintained by a small group of contributors, who are generally not compensated for their work[214]. - There is no guarantee that developer support for the Bitcoin network will continue or be sufficient, which could adversely affect the company's business[216]. - A hard fork in the Bitcoin blockchain could lead to competing implementations, potentially reducing the perceived value of bitcoin[218]. - The creation of forks, such as Bitcoin Cash, can affect the price of bitcoin and introduce new security risks[219]. - A hard fork may decrease the level of security and make the network more susceptible to attacks due to potential concentration of hashing power[222]. - Replay attacks and other security issues have occurred in past forks, leading to significant losses for exchanges[221]. - The value of bitcoin post-fork is influenced by various factors, including market reaction and the value of newly created digital assets[220].

Financial Performance - Fourth quarter 2024 net earnings were $18 million, or $0.05 per diluted share, with adjusted earnings of $51 million, or $0.14 per diluted share[7]. - Revenue from bitcoin mining for the year ended December 31, 2024, was $151.27 million, up from $126.84 million in 2023[19]. - The company reported a net loss of $44.64 million for the year ended December 31, 2024, compared to a net loss of $25.78 million in 2023[19]. - The net loss for 2024 was $44,635,000, compared to a net loss of $25,777,000 in 2023, indicating a significant increase in losses[20]. - Adjusted earnings for 2024 were $106,679,000, up from $46,204,000 in 2023, reflecting a strong improvement in operational performance[20]. - Adjusted loss earnings per diluted share improved to $0.33 in 2024 from $0.17 in 2023, indicating a positive trend in earnings performance[20]. Asset and Investment Growth - Total assets increased to $855.45 million as of December 31, 2024, compared to $566.14 million in 2023[17]. - The company completed the acquisition of a 100 MW Stingray data center site in West Texas[7]. - An additional 337 acres of land adjacent to the Barber Lake site were acquired, with a 60-day exclusivity agreement to negotiate a 500 MW HPC data center[7]. - The pipeline grew to 2.8 GW of site capacity, allowing for both HPC and bitcoin mining data centers[7]. - Phase I of the Black Pearl project, featuring 150 MW of capacity, is on track to energize in the second quarter of 2025, expected to generate over 9.5 EH/s[7]. Operational Expenses - The share-based compensation expense increased to $42,132,000 in 2024 from $38,470,000 in 2023, showing a rise of approximately 4.3%[20]. - Depreciation and amortization expenses rose to $102,448,000 in 2024, compared to $59,093,000 in 2023, representing an increase of about 73.4%[20]. Tax and Liability Changes - The deferred income tax expense for 2024 was $(937,000), a decrease from $3,366,000 in 2023, reflecting a favorable tax position[20]. - The change in fair value of derivative assets contributed $7,921,000 in 2024, compared to a loss of $26,836,000 in 2023, marking a significant turnaround[20]. - The change in fair value of warrant liability was $(250,000) in 2024, compared to $243,000 in 2023, indicating a shift in liability valuation[20]. - The per diluted share impact of share-based compensation expense was $0.13 in 2024, slightly down from $0.15 in 2023[20]. - Other nonrecurring gains were not reported in 2024, while a loss of $(2,355,000) was recorded in 2023, highlighting a shift in nonrecurring items[20]. Strategic Goals - The company aims to become a leading data center developer for HPC infrastructure while maintaining excellence in bitcoin mining[4]. Mining Operations - Total self-mining hashrate increased to approximately 13.5 EH/s following the upgrade of the Odessa fleet[7].

Fourth Quarter 2024 Net Earnings of $18m, and Adjusted Earnings of $51m Completed upgrade of Odessa fleet, increasing total self-mining hashrate to ~13.5 EH/s Completed acquisition of Stingray data center site, featuring 100 MW of front-of-the-meter capacity, all necessary regulatory approvals, and 250 acres of land adjacent to transmission assets Completed acquisition of additional 337 acres of land adjacent to Barber Lake site and entered into 60-day exclusivity for negotiations to build an additional 500 ...

Group 1 - Cipher Mining Inc. (CIFR) has gained approximately 22.8% year-to-date, outperforming the average return of 10.5% for the Business Services sector [4] - The Zacks Consensus Estimate for CIFR's full-year earnings has increased by 2.5% over the past 90 days, indicating improving analyst sentiment [4] - Cipher Mining Inc. holds a Zacks Rank of 2 (Buy), suggesting a favorable outlook for the stock [3] Group 2 - Cipher Mining Inc. is part of the Technology Services industry, which consists of 152 individual stocks and currently ranks 82 in the Zacks Industry Rank [6] - The Technology Services industry has an average year-to-date gain of 20.6%, indicating that CIFR is performing well within its industry [6] - In contrast, Gambling.com Group Limited, another stock in the Business Services sector, has returned 12.6% year-to-date and belongs to the Advertising and Marketing industry, which is ranked 165 and has declined by 4.3% this year [5][7]

Core Viewpoint - Cipher Mining Inc. (CIFR) has shown a significant price increase of 23.9% over the past four weeks, with a mean price target of $8.33 indicating a potential upside of 39.8% from the current trading price of $5.96 [1] Price Target Analysis - The average price target consists of 10 estimates ranging from a low of $7 to a high of $10, with a standard deviation of $1.16, suggesting a moderate agreement among analysts [2] - The lowest estimate indicates a potential increase of 17.5%, while the highest suggests a 67.8% upside [2] - A low standard deviation indicates a high degree of agreement among analysts regarding the stock's price movement direction [7] Earnings Estimates and Analyst Sentiment - Analysts are optimistic about CIFR's earnings prospects, as indicated by a positive trend in earnings estimate revisions, which has historically correlated with stock price movements [4][9] - Over the last 30 days, the Zacks Consensus Estimate for the current year has increased by 2.5%, with one estimate moving higher and no negative revisions [10] - CIFR holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate factors, suggesting strong potential for upside [11] Caution on Price Targets - While price targets are commonly referenced, they can mislead investors, as empirical research shows they rarely indicate actual stock price movements [5][6] - Analysts may set overly optimistic price targets due to business incentives, which can inflate expectations [6] - Investors should approach price targets with skepticism and not rely solely on them for investment decisions [8]

Core Viewpoint - Cipher Mining Inc. is set to provide a business update and release its fourth quarter and full year 2024 financial results on February 25, 2025, before U.S. markets open [1]. Company Overview - Cipher Mining focuses on the development and operation of industrial-scale data centers for bitcoin mining and high-performance computing (HPC) hosting [3]. - The company aims to be a market leader in innovation, particularly in bitcoin mining growth, data center construction, and as a hosting partner for major HPC companies [3].

Core Insights - Cipher Mining Inc. reported its unaudited production and operations update for January 2025, highlighting its ongoing efforts in bitcoin mining and data center development [1] Production and Operations Summary - The company mined approximately 219 BTC in January 2025 and sold around 471 BTC, ending the month with a total of approximately 1,091 BTC held [2][4] - Cipher deployed 75,000 mining rigs, achieving a month-end operating hashrate of 13.5 EH/s and a fleet efficiency of 18.9 J/TH [2] - The estimated power sales for January were equivalent to 1 BTC, based on a month-end bitcoin price of $102,297, along with 29 BTC mined at joint venture data centers [2][11] Management Commentary - Cipher is making progress at its Black Pearl site, nearing completion of Phase 1 buildings that cover over 100,000 square feet, and is in discussions with potential tenants and financing partners [3] Company Overview - Cipher focuses on developing and operating industrial-scale data centers for bitcoin mining and high-performance computing (HPC) hosting, aiming to be a market leader in innovation and growth within the sector [5]

Investment Announcement - SoftBank Group Corp. is set to invest $50 million in Cipher Mining Inc. through a PIPE investment, acquiring approximately 10.4 million shares of Cipher common stock [1] - This investment will bolster Cipher's HPC data center development business and position SoftBank as a significant primary investor in the company [1] Company Growth and Strategy - Cipher's CEO, Tyler Page, expressed enthusiasm about SoftBank's investment, highlighting its importance during a pivotal growth phase for the company [2] - Cipher is focused on developing and operating industrial-scale data centers for bitcoin mining and HPC hosting, aiming to lead in innovation within these sectors [4] Advisory and Legal Support - Keefe, Bruyette, & Woods Inc. served as the financial advisor for Cipher, while Latham & Watkins LLP provided legal counsel [3]

Company Performance - Cipher Mining Inc. closed at $4.49, down 0.44% from the previous trading session, underperforming the S&P 500 which gained 0.92% [1] - The company's shares have decreased by 3.22% over the past month, lagging behind the Business Services sector's gain of 2.44% and the S&P 500's gain of 0.81% [1] Earnings Projections - The upcoming earnings disclosure for Cipher Mining Inc. is anticipated, with projected earnings per share (EPS) at -$0.10, indicating a 300% decrease from the same quarter last year [2] - Quarterly revenue is estimated to be $37.52 million, reflecting a decline of 13.6% compared to the year-ago period [2] Analyst Estimates - Recent adjustments to analyst estimates for Cipher Mining Inc. are noteworthy, as they often reflect changes in short-term business dynamics [3] - Positive revisions in estimates are interpreted as favorable indicators for the company's business outlook [3] Zacks Rank and Industry Performance - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), currently places Cipher Mining Inc. at a 5 (Strong Sell) rating, with no changes in the consensus EPS estimate over the last 30 days [5] - The Technology Services industry, part of the Business Services sector, holds a Zacks Industry Rank of 87, placing it in the top 35% of over 250 industries [6] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [6]