Revenue and Earnings - Total revenue for Q1 2023 was $8.3 million, primarily from bitcoin mining[2] - Adjusted EBITDA for Q1 2023 was $1.5 million, with adjusted earnings per share of $0.01[2] - Revenue from digital asset mining services decreased by $0.3 million (3.6%) to $8.2 million for Q1 2023 compared to Q1 2022, primarily due to lower average BTC prices, partially offset by an increase of 167.5 bitcoins generated[51] - The company recognized revenue of $8.2 million from bitcoin mining services for the three months ended March 31, 2023[49] - Revenue from ETH native staking for the three months ended March 31, 2023, was $14,232, compared to $nil in 2022[157] - Revenue from ETH liquid staking for the three months ended March 31, 2023, was $36,377, compared to $nil in 2022[160] - The company's revenue from the Foundry USA Pool for the three months ended March 31, 2023, was $8,214,390, compared to $8,031,626 for the same period in 2022[153] - The company's revenue from the Ethermine Mining Pool for the three months ended March 31, 2022, was $542,121, with no revenue reported for the same period in 2023[153] - The company's total revenue for the three months ended March 31, 2023, was $8,264,999, compared to $8,573,747 for the same period in 2022[161] - Revenues for Q1 2023 were $8,264,999, a decrease of 3.6% compared to $8,573,747 in Q1 2022[106] Bitcoin and Ethereum Mining - The company earned 362.0 bitcoins during Q1 2023, with treasury holdings of BTC and ETH valued at $20.6 million and $16.6 million, respectively[2][3] - The company owned 37,676 bitcoin miners and 730 ETH miners, with an active hash rate of 1.25 EH/s for bitcoin mining as of March 31, 2023[4] - The company earned an aggregate of 5,184.9 bitcoins from the inception of its bitcoin mining business in February 2020 to March 31, 2023[37] - For the three months ended March 31, 2023, the company received 362.0 bitcoins from mining services, with a balance of 724.5 bitcoins as of March 31, 2023[38] - The company earned 8.7 ETH from native staking and 23.0 rETH-h from Portara liquid staking in Q1 2023, generating revenues of $14,232 and $36,377, respectively[54] - The company staked 1,120 ETH natively on the Ethereum blockchain for Q1 2023, earning 31.7 ETH in staking rewards, compared to nil in Q1 2022[169] - BTC opening balance for Q1 2023 was $15,796,147, with an ending balance of $13,191,157 after mining, sales, and impairments[173] - ETH opening balance for Q1 2023 was $11,791,181, with an ending balance of $13,917,057 after mining, staking, and sales[174] - Digital assets mined for the three months ended March 31, 2023 were $8,214,390, compared to $8,573,747 for the same period in 2022, representing a 4.2% decrease[115] - Digital assets earned from staking for the three months ended March 31, 2023 were $50,609, compared to $0 for the same period in 2022[115] Operational Costs and Expenses - Electricity costs increased by $0.9 million (27%) in Q1 2023 compared to Q1 2022, primarily due to an increase in the number of deployed miners[58] - Profit-sharing fees increased by $36,523 (4%) in Q1 2023 compared to Q1 2022, remaining relatively stable due to consistent mining revenues despite lower BTC prices[59] - Depreciation and amortization expenses were $3.6 million in Q1 2023, down from $3.8 million in Q1 2022, based on an estimated useful miner life of three years[59] - Depreciation expenses for Q1 2023 were $3,646,048, compared to $3,799,629 in Q1 2022[180] - Total operating expenses decreased by 24.0% from $14,901,993 in Q1 2022 to $11,321,525 in Q1 2023[106] - Share-based compensation expense for Q1 2023 was $4,873, compared to $453,484 in Q1 2022[194] Digital Assets and Impairment - The company recorded a realized gain of $4.9 million from the exchange of 583.8 bitcoins and 3,000.1 ETH in Q1 2023, compared to a gain of $2.1 million from 170.6 bitcoins and 29.4 ETH in Q1 2022[61] - Impairment of digital assets was $2.2 million in Q1 2023, comprising $1.7 million on bitcoins and $0.5 million on ETH, down from $4.6 million in Q1 2022[63] - Impairment of digital assets decreased by 51.7% from $4,625,698 in Q1 2022 to $2,233,665 in Q1 2023[106] - The company recognized an impairment loss of $2,233,665 on digital assets for the three months ended March 31, 2023, consisting of $1,709,484 on BTC and $524,181 on ETH[168] - The ending balance of digital assets as of March 31, 2023, was $27,108,214, compared to $27,587,328 as of December 31, 2022[168] - Digital assets held decreased by $479,114 to $27.1 million as of March 31, 2023, primarily due to exchanges of bitcoins and ETH into cash or other assets[74] - Digital assets decreased by $0.5 million from December 31, 2022, to March 31, 2023, primarily due to a $2.2 million impairment on bitcoin and ETH, and $7.9 million exchanged into cash, partially offset by $8.2 million generated from mining[75] - Realized gain on exchange of digital assets for the three months ended March 31, 2023 was $4,881,937, compared to $2,064,280 for the same period in 2022, representing a 136.5% increase[115] Financial Performance and Net Loss - The company's net loss for the three months ended March 31, 2023, was $2.26 million, an improvement from a net loss of $4.33 million in the same period in 2022[46] - Net loss for Q1 2023 was $2.3 million, an improvement from a net loss of $4.3 million in Q1 2022[67] - Net loss improved to $2,260,305 in Q1 2023 from $4,332,627 in Q1 2022, a 47.8% reduction[106] - Net loss for the three months ended March 31, 2023 was $2,260,305, compared to $4,332,627 for the same period in 2022, representing a 47.8% decrease in net loss[115] - Basic and diluted loss per share improved from $0.06 in Q1 2022 to $0.03 in Q1 2023[106] Cash Flow and Financial Position - Cash and cash equivalents decreased by $4.8 million to $27.9 million as of March 31, 2023, due to net cash used in operating, investing, and financing activities[71] - Net cash used in operating activities for Q1 2023 was $1.5 million, primarily due to a net loss of $2.3 million and a decrease in digital assets and stable coins of $10.9 million[91] - Net cash used in investing activities for Q1 2023 was $2.5 million, primarily due to $2.1 million invested in equity investees and $0.4 million in loans to a third party[93] - Net cash used in financing activities for Q1 2023 was $0.8 million, primarily due to dividend payments to preferred shareholders[93] - Net cash used in operating activities for the three months ended March 31, 2023 was $1,480,014, compared to net cash provided by operating activities of $339,572 for the same period in 2022[115] - Net cash used in investing activities for the three months ended March 31, 2023 was $2,503,807, compared to $11,112,195 for the same period in 2022, representing a 77.5% decrease[115] - Net cash used in financing activities for the three months ended March 31, 2023 was $800,000, compared to $2,219,355 for the same period in 2022, representing a 63.9% decrease[115] - Cash, cash equivalents and restricted cash decreased by $4,783,821 to $29,227,239 as of March 31, 2023, compared to $34,011,060 as of December 31, 2022[115][116] - Working capital as of March 31, 2023, was $56.6 million, including $0.5 million in USDC and $27.1 million in digital assets, compared to $57.0 million as of December 31, 2022[84] - Total assets decreased from $100,420,667 to $92,162,541, a decline of 8.2%[99][103] - Total current liabilities decreased by 71.8% from $7,443,354 to $2,100,642[100] - Shareholders' equity decreased from $89,933,309 to $86,979,845, a decline of 3.3%[103] - Accumulated deficit increased by 2.3% from $131,416,011 to $134,476,316[103] - Total non-current assets decreased by 7.1% from $36,025,394 to $33,463,723[99] Strategic Investments and Agreements - The company made a $2 million strategic investment in Auros Global Limited on February 24, 2023[5] - The company signed purchase agreements for 3,600 S19 miners on April 28, 2023, and 3,000 S19J Pro miners on May 12, 2023[7] - The company expanded into Iceland with an 8.25 MW hosting capacity agreement and a $5 million loan facility with GreenBlocks[11][25] - The company entered into hosting agreements for over 30 MW of additional mining capacity post-Q1, with a focus on carbon-free energy[11] - The company invested $1,999,987 in Auros Global Limited, a crypto-native algorithmic trading firm, in February 2023[187] - The company invested $88,994 in Marsprotocol Technologies Pte. Ltd., representing a 40% equity interest[189] - The company declared an 8% dividend ($800,000) on preference shares to Geney Development Ltd. in February 2023[199] Environmental and ESG Initiatives - Approximately 85% of the company's mining fleet was powered by carbon-free energy sources as of March 31, 2023[4] - The company aims to achieve 100% clean energy usage and is working with Apex Group Ltd to receive an independent ESG rating[41] - The company joined the Bitcoin Mining Council on December 7, 2021, to promote transparency and share best practices in bitcoin mining[42] Mining Infrastructure and Capacity - As of March 31, 2023, the company deployed 12,938 bitcoin miners representing 1.25 EH/s in North America[27] - The company's total contracted hosting capacity with Blockbreakers reached approximately 9 MW after securing an additional 4 MW agreement[28] - Coinmint provided approximately 20 MW of capacity for the company's miners as of March 31, 2023, with a total contracted hosting capacity reaching 40 MW after new agreements[29][30][31] - The company had 37,676 bitcoin miners and 730 ETH miners as of March 31, 2023, with a total maximum hash rate of 2.6 EH/s and 0.3 TH/s, respectively[34] - The company aims to double its active hash rate in 2023 and targets having approximately half of its digital assets actively staked[11][12] - The company's deposits for property and equipment had an ending balance of $2,609,706 for the three months ended March 31, 2023, compared to $54,147,381 for the same period in 2022[143] Other Financial Metrics - Adjusted EBITDA for Q1 2023 was $1,503,336, compared to a loss of $2,068,635 in Q1 2022[80] - Adjusted EPS for Q1 2023 was $0.01, compared to a loss of $0.02 in Q1 2022[82] - Accounts payable decreased by $2.8 million from December 31, 2022, to March 31, 2023, due to payments to hosting partners[76] - Long-term income tax payable increased by $38,050 from December 31, 2022, to March 31, 2023, due to incremental penalties on unrecognized tax benefits[76] - The company's USDC balance as of March 31, 2023, was $481,293, compared to $15,768,934 as of March 31, 2022[167] - Total other current assets as of March 31, 2023, were $1,226,515, down from $1,433,999 at the end of 2022[177] - The company recorded upward adjustments of $42,891 on its investment in Nine Blocks Offshore Feeder Fund for Q1 2023[186]
Bit Digital(BTBT) - 2023 Q2 - Quarterly Report