Core Insights - Riot Platforms reported a revenue of $153 million for fiscal Q2 2025, marking a 5% decline quarter-over-quarter, but achieved a net income of $219.5 million, reversing a previous GAAP net loss due to Bitcoin appreciation [1] Group 1: Shift to Data Centers - Riot is transitioning to high-performance computing (HPC) data centers, having hired Jonathan Gibbs as Chief Data Center Officer and acquired 858 acres in Corsicana to support up to 1 gigawatt of capacity [3][4] - This strategic shift aims to capitalize on higher valuation multiples in the data center sector, moving beyond Bitcoin mining cyclicality and establishing a presence in the expanding HPC infrastructure market [4] Group 2: Operational Efficiency - Riot increased its self-mining hash rate by 5% quarter-over-quarter to 35.4 exahash, while producing 1,406 bitcoins, a slight decrease from 1,530 bitcoins in the previous quarter [5] - Year-over-year hash rate utilization improved from 61% to 87%, contributing to a 50% gross margin for the Bitcoin mining segment, positioning Riot among the most efficient miners in the industry [5][6] Group 3: Financial Strategy - Riot ended the quarter with $330 million in cash and over 19,000 bitcoins, equating to $2.4 billion in liquidity, and secured a $200 million Bitcoin-collateralized loan with Coinbase [7] - The company continues to sell its monthly Bitcoin production to finance operations while minimizing stock issuance through at-the-market equity, thereby preserving shareholder value [8][9] Group 4: Future Guidance - Management raised self-mining hash rate guidance for fiscal Q4 2025 from 38.4 exahash to 40 exahash, with a target of 45 exahash for fiscal Q1 2026, aiming to maintain a 4% global network share through 2026 [10] - The basis of design for the Corsicana data center is expected to be completed by the end of fiscal Q3 2025, supported by secured infrastructure for 600 megawatts and land for up to 1 gigawatt of capacity [11]

Group 1 - Cryptocurrency concept stocks experienced a collective decline, with Coinbase dropping over 16% [1] - Riot Platforms saw a significant drop of more than 18% [1] - Other companies such as Circle and Robinhood also faced declines, each falling over 8% [1]

Core Viewpoint - The analysis of Riot Platforms (NASDAQ: RIOT) suggests it is a suitable trading option but not recommended for long-term holding [1]. Group 1: Company Overview - Riot Platforms is involved in the cryptocurrency sector, specifically focusing on Bitcoin mining [1]. - The company has been covered previously, indicating a level of ongoing interest and analysis in its performance and market position [1]. Group 2: Analyst Perspective - The analyst expresses a personal investment in Bitcoin, indicating a vested interest in the cryptocurrency market [2]. - The article reflects the analyst's independent opinions and does not represent any external business relationships [2].

Group 1 - Riot Platforms, Inc. reported $152.99 million in revenue for the quarter ended June 2025, a year-over-year increase of 118.5% [1] - The company achieved an EPS of $0.57, compared to -$0.32 a year ago, resulting in a surprise of +400% against the consensus estimate of -$0.19 [1] - The reported revenue was slightly below the Zacks Consensus Estimate of $153.47 million, indicating a surprise of -0.31% [1] Group 2 - The quantity of Bitcoin mined was 1,426, closely matching the average estimate of 1,427 [4] - Revenue from Bitcoin mining reached $140.89 million, exceeding the average estimate of $134.37 million, representing a year-over-year change of +152.7% [4] - Engineering revenue was reported at $10.58 million, below the estimated $16.74 million, reflecting a +9.9% change year-over-year [4] - Other revenue was $1.52 million, lower than the estimated $1.98 million, showing a significant decline of -67.1% year-over-year [4] Group 3 - Shares of Riot Platforms, Inc. have returned +10.8% over the past month, outperforming the Zacks S&P 500 composite's +2.7% change [3] - The stock currently holds a Zacks Rank 4 (Sell), suggesting potential underperformance relative to the broader market in the near term [3]

Riot Platforms, Inc. (RIOT) came out with quarterly earnings of $0.57 per share, beating the Zacks Consensus Estimate of a loss of $0.19 per share. This compares to a loss of $0.32 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +400.00%. A quarter ago, it was expected that this company would post a loss of $0.25 per share when it actually produced a loss of $0.9, delivering a surprise of -260%. Over the last four quarters, t ...

Financial Performance - Riot Platforms reports net profit in Q2 [1] Operational Metrics - Cost to mine bitcoin doubles year-over-year [1]

Financial Data and Key Metrics Changes - Riot reported total revenue of $153 million for the second quarter, a 5% decrease from $161.4 million in the previous quarter, primarily due to lower Bitcoin production [19] - Gross profit for the second quarter was $70.3 million, compared to $73.6 million in the prior quarter, with a gross margin of 46%, unchanged from the previous quarter [19] - Net income for the second quarter was $219.5 million, or $0.65 per share, compared to a net loss of $296.4 million, or $0.90 per share, in the prior quarter [19][20] - Non-GAAP adjusted EBITDA for the second quarter was $495.3 million, compared to a loss of $176.3 million in the prior quarter [20] Business Line Data and Key Metrics Changes - Riot increased its self-mining hash rate from 33.7 to 35.4, representing a 5% increase, while the global hash rate rose by 9% during the same period [18] - Bitcoin mining revenue totaled $140.9 million, consistent with the prior quarter's revenue of $142.9 million, with a gross margin of 50%, up from 48% in the previous quarter [21] - Direct cost to mine, excluding depreciation, totaled $48,992 per Bitcoin, with power costs accounting for 77% of total direct costs [21][22] Market Data and Key Metrics Changes - The market for data center talent is highly competitive, with significant demand for power and infrastructure that is not currently being met [49] - The demand for compute capacity is expected to continue growing, driven by the AI arms race and increasing CapEx budgets from hyperscalers [49] Company Strategy and Development Direction - Riot's strategy focuses on maximizing the value of its power portfolio and transitioning power capacity towards data centers while utilizing Bitcoin mining where advantageous [13][41] - The company aims to build a robust and scalable data center segment, leveraging its existing power assets and Bitcoin mining capabilities [7][10] - Riot has hired Jonathan Gibbs as Chief Data Center Officer to lead the development of its data center business [14][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to capitalize on market dynamics, emphasizing the importance of having readily available power in high-demand jurisdictions [41] - The company is strategically positioned to benefit from the growing gap between power demand and supply, particularly in key markets like Dallas and Austin [40] - Management highlighted the importance of a disciplined approach to capital allocation and the potential for shareholder value creation through strategic growth initiatives [12][41] Other Important Information - Riot ended the second quarter with over 19,000 Bitcoin and $330 million in cash, representing $2.4 billion in liquidity [15] - The company is actively engaged in discussions with potential data center tenants and has made significant progress in its Bitcoin mining operations [15][29] Q&A Session Summary Question: Discussion on Bitcoin generation and huddle strategy - Management explained that selling Bitcoin production allows the company to cover operating costs and focus on growth opportunities, with plans to adjust strategies based on Bitcoin price fluctuations [44][46] Question: Market dynamics regarding power transactions - Management noted robust demand in the data center market, with a significant gap between power availability and forecasted demand, emphasizing the importance of large-scale power capacity [49][50] Question: Basis of design for data centers - Management confirmed that significant progress has been made on the basis of design, which is crucial for engaging potential tenants and advancing negotiations [55][57] Question: Long lead times and infrastructure development - Management stated that critical infrastructure has already been secured, and they are confident in their ability to meet timelines for equipment procurement [59][60] Question: Potential tenants and negotiations - Management indicated that the basis of design will enhance negotiations with potential tenants, allowing for flexibility in serving various customer types [66][68] Question: Bitcoin mining outlook and network hash rate - Management projected a year-over-year growth of approximately 26% from 2024 to 2025, with a focus on maximizing the value of their power portfolio [74]

PART I - FINANCIAL INFORMATION [Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents Riot Platforms' unaudited condensed consolidated financial statements for Q2 and H1 2025, including balance sheets, operations, and cash flows [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to **$4.29 billion** by June 30, 2025, driven by Bitcoin holdings and new debt facilities Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $516,103 | $599,476 | | **Bitcoin** | $1,711,908 | $1,654,468 | | **Total Assets** | **$4,285,401** | **$3,935,307** | | **Total Current Liabilities** | $374,907 | $160,385 | | **Total Liabilities** | **$989,485** | **$791,622** | | **Total Stockholders' Equity** | **$3,295,916** | **$3,143,685** | - Key changes from Dec 31, 2024 include a decrease in cash and cash equivalents from **$277.9 million** to **$255.4 million**, and an increase in total debt (current and long-term) from **$584.6 million** to **$838.4 million**[13](index=13&type=chunk) [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2025 saw **$219.5 million** net income due to Bitcoin fair value gains, while H1 2025 recorded a net loss Q2 2025 vs Q2 2024 Performance (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Total Revenue** | $152,988 | $70,018 | | Bitcoin Mining Revenue | $140,889 | $55,764 | | Change in fair value of bitcoin | $470,812 | $(76,403) | | Loss on contract settlement | $(158,137) | $0 | | **Operating Income (Loss)** | $216,146 | $(117,041) | | **Net Income (Loss)** | **$219,454** | **$(84,449)** | | **Diluted EPS** | **$0.58** | **$(0.32)** | H1 2025 vs H1 2024 Performance (in thousands, except per share data) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | **Total Revenue** | $314,375 | $149,314 | | Bitcoin Mining Revenue | $283,748 | $127,160 | | **Operating Income (Loss)** | $(17,728) | $86,901 | | **Net Income (Loss)** | **$(76,913)** | **$127,328** | | **Diluted EPS** | **$(0.23)** | **$0.51** | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) H1 2025 cash used in operations increased to **$353.4 million**, with financing activities providing **$372.4 million** Six Months Ended June 30, Cash Flow Summary (in thousands) | Cash Flow Category | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $(353,385) | $(100,365) | | Net cash provided by (used in) investing activities | $(40,019) | $(520,689) | | Net cash provided by (used in) financing activities | $372,351 | $505,053 | | **Net (decrease) in cash** | **$(21,053)** | **$(116,001)** | - Investing activities in H1 2025 included **$93.2 million** for property and equipment and **$86.4 million** in deposits, offset by **$131.8 million** in proceeds from bitcoin sales, a significant reduction from H1 2024's **$520.7 million** use of cash[24](index=24&type=chunk) - Financing activities in H1 2025 were driven by **$123.9 million** from ATM offerings and **$261 million** in net proceeds from new debt facilities[24](index=24&type=chunk) [Note 3. Acquisitions](index=15&type=section&id=Note%203.%20Acquisitions) The company completed key acquisitions, including Rhodium assets for **$185.0 million** and Block Mining for **$113.6 million** - Settled all litigation with Rhodium, acquired its assets at the Rockdale Facility, and terminated legacy hosting agreements for **$185.0 million**, resulting in a recognized loss on contract settlement of **$158.1 million**[47](index=47&type=chunk)[50](index=50&type=chunk) - Acquired E4A Solutions, an electrical engineering company, for approximately **$54.4 million** to support its vertically integrated strategy[51](index=51&type=chunk)[52](index=52&type=chunk) - Acquired Block Mining, a Kentucky-based bitcoin miner, for approximately **$113.6 million**, adding **60 MW** of operational capacity and access to the MISO electrical grid[60](index=60&type=chunk)[63](index=63&type=chunk) [Note 5. Bitcoin](index=21&type=section&id=Note%205.%20Bitcoin) As of June 30, 2025, the company held **19,273 bitcoin** with a fair value of **$2.07 billion** Bitcoin Holdings as of June 30, 2025 | Category | Quantity | Fair Value (in thousands) | | :--- | :--- | :--- | | Bitcoin | 15,973 | $1,711,908 | | Restricted bitcoin | 3,300 | $353,672 | | **Total** | **19,273** | **$2,065,580** | - For the six months ended June 30, 2025, the company recognized **$283.7 million** in revenue from mining **2,956 bitcoin**[82](index=82&type=chunk) [Note 12. Debt](index=33&type=section&id=Note%2012.%20Debt) Total outstanding debt reached approximately **$840 million** by June 30, 2025, including **$594.4 million** in convertible notes - Outstanding **0.75% Convertible Senior Notes** due 2030 have a principal amount of **$594.4 million**[132](index=132&type=chunk) - Entered into and fully drew down a **$200 million** credit facility with Coinbase, secured by **3,300** of the company's bitcoin[145](index=145&type=chunk)[147](index=147&type=chunk) - As of June 30, 2025, borrowings outstanding under the **$50 million** and **$20 million** revolving credit facilities were **$34.3 million** and **$20.0 million**, respectively[139](index=139&type=chunk)[143](index=143&type=chunk) [Note 17. Commitments and Contingencies](index=44&type=section&id=Note%2017.%20Commitments%20and%20Contingencies) The company faces **$83.5 million** in miner commitments and significant legal claims exceeding **$1 billion** from former customers - Remaining commitment of **$83.5 million** for the purchase of miners from MicroBT, expected to be paid during the remainder of 2025[186](index=186&type=chunk) - Legacy hosting customer SBI Crypto is claiming over **$350 million** in lost profits and **$50 million** in equipment replacement costs[201](index=201&type=chunk) - Legacy hosting customer GMO is seeking damages in excess of **$150 million** plus an additional **$496 million** for alleged wrongful termination of their agreement[202](index=202&type=chunk)[204](index=204&type=chunk) [Note 19. Segment Information](index=51&type=section&id=Note%2019.%20Segment%20Information) Riot operates in Bitcoin Mining and Engineering segments, with Q2 2025 Bitcoin Mining revenue at **$140.9 million** Segment Performance for Three Months Ended June 30, 2025 (in thousands) | Segment | Revenue from External Customers | Segment Gross Profit (Loss) | | :--- | :--- | :--- | | **Bitcoin Mining** | $140,889 | $62,714 | | **Engineering** | $10,576 | $5,728 | Segment Performance for Six Months Ended June 30, 2025 (in thousands) | Segment | Revenue from External Customers | Segment Gross Profit (Loss) | | :--- | :--- | :--- | | **Bitcoin Mining** | $283,748 | $130,755 | | **Engineering** | $24,496 | $14,166 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=55&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Riot's vertically integrated strategy, Bitcoin mining, AI/HPC expansion, and financial performance [Business Overview and Trends](index=55&type=section&id=Business%20Overview%20and%20Trends) Riot's deployed hash rate reached **35.4 EH/s** by June 30, 2025, with a dual strategy in Bitcoin mining and AI/HPC - The company is pursuing a dual-pronged strategy focusing on Bitcoin mining and developing a scalable data center platform for AI/HPC workloads[226](index=226&type=chunk) Key Bitcoin Mining Metrics | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Combined Deployed Hash Rate (EH/s)** | 35.4 | 31.5 | | **Total Developed Power Capacity (MW)** | 1,165 | 900 | - Cost to mine one bitcoin for Q2 2025 was **$48,992** excluding depreciation, and **$91,244** including depreciation[239](index=239&type=chunk) - The power strategy, including manual curtailment and demand response programs, generated **$8.3 million** in power credits in Q2 2025[253](index=253&type=chunk) [Results of Operations](index=68&type=section&id=Results%20of%20Operations) Q2 2025 revenue increased **118%** to **$153.0 million** due to higher Bitcoin prices and production, leading to net income - Q2 2025 Bitcoin Mining revenue increased by **$85.1 million** YoY, due to higher average bitcoin prices (**$98,800** vs **$66,004**) and a **68.9%** increase in bitcoin production[271](index=271&type=chunk) - Q2 2025 costs increased significantly, with Bitcoin Mining cost of revenue up **$42.9 million**, SG&A up **$14.7 million**, and Depreciation & Amortization up **$45.9 million** YoY[274](index=274&type=chunk)[276](index=276&type=chunk)[277](index=277&type=chunk) Adjusted EBITDA Reconciliation (in thousands) | Period | Net Income (Loss) | Adjusted EBITDA | | :--- | :--- | :--- | | **Q2 2025** | $219,454 | $495,268 | | **Q2 2024** | $(84,449) | $(75,207) | | **H1 2025** | $(76,913) | $318,931 | | **H1 2024** | $127,328 | $170,522 | [Liquidity and Capital Resources](index=75&type=section&id=Liquidity%20and%20Capital%20Resources) Riot had **$141.2 million** in net working capital as of June 30, 2025, funding operations via debt and equity offerings - As of June 30, 2025, the company had net working capital of **$141.2 million**, with cash and cash equivalents of **$255.4 million**[308](index=308&type=chunk) - In H1 2025, the company raised **$121.1 million** in net proceeds from its ATM equity program by selling **10.8 million** shares[307](index=307&type=chunk)[317](index=317&type=chunk) - Financing activities in H1 2025 provided **$372.4 million**, primarily from ATM proceeds and **$254.3 million** in net proceeds from new debt arrangements[323](index=323&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=81&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Primary market risks are Bitcoin price and power costs, with a 10% Bitcoin change impacting H1 2025 net income by **$338.4 million** - The company's main market risk exposures are the volatile price of bitcoin and the price of power for its mining operations[338](index=338&type=chunk)[341](index=341&type=chunk) Market Risk Sensitivity Analysis for H1 2025 (in thousands) | Risk Factor | 10% Increase Impact on Net Income | 10% Decrease Impact on Net Income | | :--- | :--- | :--- | | **Price of Bitcoin** | $338,388 | $(338,388) | | **Future Power Prices** | $41,537 | $(41,537) | [Controls and Procedures](index=83&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls were effective as of June 30, 2025, with ongoing integration of acquired entities' internal controls - Management concluded that disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2025[343](index=343&type=chunk) - The company is integrating internal controls of Block Mining and E4A Solutions acquisitions, with full inclusion expected by year-end 2025[344](index=344&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=85&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in significant legal proceedings, including patent disputes and large breach of contract claims - This section incorporates by reference the disclosures in Note 17, which details ongoing litigation[345](index=345&type=chunk) [Risk Factors](index=85&type=section&id=Item%201A.%20Risk%20Factors) New risks relate to AI/HPC expansion, including execution challenges, third-party reliance, and resource diversion - New risks are identified related to the early-stage development of AI/HPC infrastructure, including potential for unforeseen challenges and budget overruns[347](index=347&type=chunk)[348](index=348&type=chunk) - The success of the AI/HPC initiative is dependent on attracting and retaining qualified third-party partners and customers[351](index=351&type=chunk) - Expansion into AI/HPC may divert capital, personnel, and power capacity from the core Bitcoin mining business, potentially diminishing its competitive position[352](index=352&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=87&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q2 2025, the company repurchased **9,134 shares** to satisfy tax obligations on employee restricted stock awards - In Q2 2025, employees surrendered **9,134 shares** to the company to cover tax obligations on vested restricted stock awards[353](index=353&type=chunk)[356](index=356&type=chunk) [Other Information](index=87&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted, modified, or terminated Rule 10b5-1 trading plans during Q2 2025 - No directors or officers adopted or terminated a Rule 10b5-1 plan during the three months ended June 30, 2025[354](index=354&type=chunk) [Exhibits](index=88&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed, including key agreements and required officer certifications - Lists key agreements filed as exhibits, such as the Credit Agreement with Coinbase and the Purchase and Sale Agreement with Rhodium[357](index=357&type=chunk) - Includes required certifications from the CEO and CFO under Sarbanes-Oxley Sections 302 and 906[357](index=357&type=chunk)

Financial Performance - Riot Platforms reported a record net income of $219.5 million and adjusted EBITDA of $495.3 million for Q2 2025, significantly up from a net loss of $84.4 million in Q2 2024[2][17]. - Total revenue for Q2 2025 was $153.0 million, a 118.6% increase compared to $70.0 million in Q2 2024, primarily driven by an $85.1 million increase in Bitcoin mining revenue[5]. - Bitcoin mining revenue reached $140.9 million in Q2 2025, compared to $55.8 million in Q2 2024, driven by higher average bitcoin prices and an increase in operational hash rate[5]. - Riot maintained a strong financial position with $141.1 million in working capital, including $255.4 million in unrestricted cash[10]. - The company held 19,273 bitcoins valued at approximately $2.1 billion based on a market price of $107,174 per bitcoin as of June 30, 2025[10]. Bitcoin Production and Costs - The company produced 1,426 bitcoins in Q2 2025, up 68.8% from 844 bitcoins in the same period last year[5]. - The average cost to mine one bitcoin, excluding depreciation, was $48,992 in Q2 2025, a 93.2% increase from $25,329 in Q2 2024, largely due to the block subsidy halving and a 45% increase in the average global network hash rate[5][18]. Engineering and Strategic Focus - Engineering revenue for Q2 2025 was $10.6 million, slightly up from $9.6 million in Q2 2024, benefiting from $18.5 million in capex savings since the acquisition of ESS Metron[5]. - The company is focused on optimizing its power portfolio and expanding into high-value data centers, supported by recent strategic hires[3]. Future Growth Strategies - Future growth strategies include enhancing Bitcoin mining operations and exploring AI/HPC market opportunities, leveraging the company's robust balance sheet and capital access[9].

Q2 2025 Key Accomplishments - Riot acquired an additional 238 acres at Corsicana, increasing the total acreage footprint to 858 acres[17] - Bitcoin Mining operations achieved a 50% gross margin[17] - The company's all-in power cost was $0.035 per kWh, and the hash cost was $25/PH/s/day[17] - Riot ended Q2 2025 with 19,273 BTC and $330 million in cash[18] - The company sold 1,371 BTC at an average price of $96,136 per BTC, generating proceeds of $132 million[18] Q2 2025 Financial Update - Riot produced 1,426 BTC in Q2 2025, averaging 15.7 BTC per day[22] - The company held 19,273 BTC valued at $2.1 billion, representing a $479 million increase[22] - Total revenue was $153 million, with $140.9 million from Bitcoin Mining, a 119% increase compared to Q1 2024[22] - Net income was $219.5 million, including a $470.8 million unrealized gain on bitcoin held[22] - Power curtailment credits amounted to $8.3 million[22]