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 $33.5 million (approximately USD $23.3 million), with an expected investment of USD $19.3 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 $150 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 $50 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 $7.9 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 $50 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 $5 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 $14.1 million or 64.5% compared to $21.9 million for the same period in 2024[294][303]. - Cloud services revenue increased by $6.8 million, or 83.9%, to $14.8 million for the three months ended March 31, 2025, compared to $8.1 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 $0 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 $50.1 million for the same period in 2024, reflecting a variance of $107.8 million[294]. - The company reported a net loss of $57.7 million for the three months ended March 31, 2025, a change of $107.8 million from a net income of $50.1 million in the same period of 2024[334]. - Adjusted EBITDA for the three months ended March 31, 2025, was $(44.5) million, compared to $58.5 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 $45.7 million in the same period of 2024[331]. Asset Management - The company's total assets decreased by $52,999,090 to $485,248,574 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 $37,646,324 to $57,555,011 as of March 31, 2025, compared to $95,201,335 as of December 31, 2024[336]. - The balance of accounts receivable decreased to $2.5 million as of March 31, 2025, down from $5.3 million as of December 31, 2024, attributed to paid invoices from customers[339]. - The balance of digital assets decreased by $82.3 million to $XX 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 $21.2 million and $0.1 million, respectively, as of March 31, 2025, down from $30.8 million and $0.1 million as of December 31, 2024, reflecting a recognition of $11.1 million in revenue[355]. - Working capital decreased to $139.8 million as of March 31, 2025, from $241.8 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 $239,398 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, 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].
Bit Digital(BTBT) - 2025 Q1 - Quarterly Report