Bitcoin Miner Hut 8 Posts $71.9M Q2 Loss Despite 72% Revenue Growth

North American Bitcoin miner and energy infrastructure operator Hut 8 Corp. announced Tuesday its financial results for the three and six months ending June 30, 2024.

The company reported a 72% increase in revenue year-over-year, reaching $35.2 million in its latest quarterly earnings report. This growth stemmed from a 21% reduction in the cost per kilowatt-hour for mining Bitcoin and an expansion in the company’s computing power business lines.

How Hut 8’s Energy Capacity and Hash Rate Are Driving Revenue Despite Losses

Hut 8’s energy capacity now stands at 1,075 megawatts (MW), including Bitcoin mining, natural gas power generation, and cloud data centers. This expansion has supported revenue growth, even as challenges such as network halving and a drop in Bitcoin prices impacted profitability.

CEO Asher Genoot reported improved performance despite the network halving, with Digital Assets Mining segment’s gross margins rising to 46% from 34% year-over-year.

The activation of the Salt Creek facility reduced energy costs per kilowatt-hour by 21%, from $0.040 in Q1 2024 to $0.032 in Q2 2024. The company now owns approximately 49,400 miners, achieving a total hash rate of 4.8 exahash per second (EH/s).

Despite these positive financial returns, Hut 8 reported a net loss of $71.9 million, primarily due to a $71.8 million fair value adjustment on its holdings, driven by new Financial Accounting Standards Board rules and a decline in Bitcoin prices. This compares to a net loss of $1.7 million in the same period last year.

Hut 8 Sees Drop in Bitcoin Holdings, but Alternative Revenue Grows

Hut 8 produced approximately 279 bitcoins in the past quarter, increasing its total holdings to 9,102 self-mined coins, valued at around $571 million as of July 31. However, this represents a decrease from the 740 bitcoins mined in the same quarter last year, with the cost to mine Bitcoin nearly doubling year-over-year to $26,232 per coin.

The company’s revenue primarily comes from alternative computing business lines, including high-performance computing and managed services, which generated $21.3 million, compared to $13.9 million from Bitcoin mining.

Hut 8 is focusing on scaling its power footprint and enhancing its energy infrastructure, with a new 205 MW site in the Texas Panhandle and a $150 million partnership with Coatue.

On June 24, Coatue Management announced a $150 million investment in Hut 8 through a convertible note, offering an 8% annual return with a five-year term and potential one-year extensions. The transaction was completed on July 11 and filed with the SEC on June 21.

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