BitMine Immersion Technologies Inc(BMNR) - 2023 Q3 - Quarterly Report

Revenue Generation - For the three months ended May 31, 2023, the Company generated $142,146 in revenue, a significant increase from $16,567 in the same period of 2022 [99]. - For the nine months ended May 31, 2023, the Company generated $399,932 in revenue, an increase from $365,841 in the same period in 2022 [117]. - The Company generated $13,647 in revenue from equipment sales for the three months ended May 31, 2023, compared to $0 in the same period in 2022 [102]. - The Company generated $0 in revenue from hosting for the nine months ended May 31, 2023, down from $16,567 in the same period in 2022 due to the decision to cease hosting third-party miners and focus on self-mining [124]. Bitcoin Mining Performance - Bitcoin revenue from self-mining reached $128,479 during the three months ended May 31, 2023, compared to $0 in the same period of 2022 [100]. - Bitcoin revenue from self-mining was $261,921 for the nine months ended May 31, 2023, compared to $4,574 in the same period in 2022 [118]. Operating Expenses and Losses - Operating expenses increased to $584,908 for the three months ended May 31, 2023, a 77.3% increase from $329,964 in the same period in 2022 [111]. - The Company incurred a net loss of $523,704, or $0.01 per share, for the three months ended May 31, 2023, compared to a net loss of $486,912, or $0.01 per share, in the same period in 2022 [115]. - Operating expenses increased to $1,422,385 for the nine months ended May 31, 2023, up 17.3% from $1,150,119 in the same period in 2022, primarily due to higher general and administrative expenses and depreciation [131]. - The Company incurred a net loss of ($1,301,755) or ($0.03) per share for the nine months ended May 31, 2023, compared to a net loss of ($1,307,795) or ($0.03) per share in the same period in 2022 [134]. Cash Flow and Financing - Cash flows used in operating activities were ($1,427,882) for the nine months ended May 31, 2023, compared to ($454,327) in the same period in 2022, reflecting a significant increase in cash outflows [135]. - Cash flows provided by financing activities were $1,300,000 for the nine months ended May 31, 2023, down from $3,004,313 in the same period in 2022, primarily from draws under a line of credit [137]. - The Company expects to receive approximately $31,000 per month from the sale of four immersion containers to a joint venture, contributing to future liquidity [139]. - The Company plans to pursue additional capital-raising alternatives to expand its digital asset hosting and mining business, indicating a need for further funding [140]. - As of May 31, 2023, the Company had $518,425 in cash on hand, which is expected to support operations for the next 12 months [135]. Operational Developments - The network hash rate increased by 70.78% from 219.86 EH/s as of August 31, 2022, to 375.466 EH/s as of May 31, 2023 [91]. - The difficulty index rose by 65.38% from 30.98 trillion to 51.234 trillion during the same period [91]. - The market price of Bitcoin increased by 35.73% from $20,049.76 to $27,213.71 between August 31, 2022, and May 31, 2023 [91]. - The Company plans to operate data centers using immersion cooling technology, which can be up to 95% more efficient than standard air cooling [84]. - The Company has entered into an agreement with TSTT to co-locate up to 125 containers for hosting digital asset miners, with electricity costs billed at a minimum of 3.5 cents per kWh [92]. - The joint venture in Pecos, Texas, has secured electricity at $0.03991 per kWh, significantly lower than the previous rate of $0.06896 per kWh [97]. - The Trinidad facility is expected to become operational by August 1, 2023, following the resolution of a dispute regarding electricity pricing [100]. - The Company is focusing on developing hosting centers in the United States and Canada, exploring both traditional and renewable energy sources for cost-effective operations [95]. Future Expectations - The Company expects future revenues to be impacted by the deployment of additional miners and the resolution of hosting facility disputes [118]. - The Company anticipates that operating expenses will trend higher in future periods due to regular compensation for officers and directors and increased depreciation expenses [112]. - The Company expects to generate additional revenues from the resale of hosting equipment and miners in "buy/host" transactions in future periods [104]. - Cost of sales for the three months ended May 31, 2023, was $72,392, down from $99,711 in the same period in 2022 [107]. - Cost of sales for the nine months ended May 31, 2023, was $286,324, a decrease of 13.7% from $331,836 in the same period in 2022 [127].