CleanSpark Q1 Loss Wider Than Expected, Revenues Increase Y/Y

Core Insights - CleanSpark (CLSK) reported a first-quarter fiscal 2026 loss of $0.10 per share, which was wider than the Zacks Consensus Estimate of an $0.08 loss [1] - The company experienced a loss from continuing operations of $1.35 per share, contrasting with earnings of $0.83 per share in the same quarter last year [1] - Revenues increased by 11.6% year over year to $181.2 million, but this figure missed the consensus estimate by 2.12% [1] Financial Performance - CleanSpark's first-quarter fiscal 2026 gross profit decreased by 7% year over year to $85.6 million, with a gross margin contraction of 940 basis points to 47.2% [4] - The company reported an operating loss of $316.6 million, compared to an operating income of $210 million in the year-ago quarter [4] - Adjusted EBITDA loss was $295.4 million, a significant decline from positive Adjusted EBITDA of $321.6 million in the previous year [5] - The net loss for the quarter was $378.7 million, primarily due to fair value adjustments related to bitcoin [5] Strategic Transition - CleanSpark is transitioning from a pure-play bitcoin miner to a broader energy, compute, and infrastructure platform, aiming to capture opportunities in high-performance computing (HPC) and AI data centers [2] - For 2026, management is focusing on expanding its power and land portfolio, monetizing available megawatt capacity, and accelerating the development of AI-focused data center infrastructure [3] - The company's multi-year roadmap includes phased execution plans targeting construction milestones and tenant visibility in 2026, scaling operations and diversifying tenants in 2027, and building multi-campus, giga-scale project capabilities by 2028 [3] Balance Sheet Overview - As of December 31, 2025, CleanSpark had cash and cash equivalents of $458 million, a significant increase from $43 million as of September 30, 2025 [6] - The total long-term debt, net of debt discount and issuance costs, was $1.79 billion as of December 31, 2025 [6] - The company held 13,099 Bitcoin, with an approximate market value of $1.15 billion, and had $400 million of available liquidity under its line of credit [7]