Riot Platforms Inc (RIOT, Financial), a leader in Bitcoin mining and data center hosting, disclosed its financial results for the third quarter ended September 30, 2023, on November 7, 2023. The company's unaudited financial statements and presentation materials are available on its website, providing a detailed overview of its financial and operational performance.
Financial Performance Overview
RIOT reported a total revenue of $51.9 million for Q3 2023, which included $31.2 million from Bitcoin Mining, $5.1 million from Data Center Hosting, and $15.5 million from Engineering. The company's Bitcoin Mining segment saw a slight decrease in profitability compared to the same period in 2022, primarily due to higher labor costs associated with the expansion of the Rockdale facility. Data Center Hosting faced a cost of revenue in excess of revenue, mainly due to direct power costs. However, Engineering revenue exceeded its cost of revenue, showing an improvement from the previous year.
RIOT's power curtailment credits, which totaled approximately $49.6 million for the quarter, played a significant role in offsetting costs. If these credits were allocated based on proportional power consumption, the non-GAAP Bitcoin Mining revenue would have significantly exceeded the cost of revenue, while Data Center Hosting costs would have been substantially reduced.
Operational Highlights and Challenges
RIOT achieved a new all-time record hash rate capacity of 10.9 EH/s and expects to reach 12.5 EH/s in Q4 2023 as repairs from storm damage are completed. The company also updated its initial order with MicroBT to include more advanced Bitcoin miners, which is expected to boost total self-mining hash rate capacity to 20.2 EH/s by mid-2024.
However, the company recorded a net loss of $45.3 million for the quarter, or $0.25 per share, compared to a net loss of $32.4 million, or $0.21 per share for the same period in 2022. This loss included significant non-cash expenses such as stock-based compensation, depreciation, amortization, and impairment of Bitcoin.
Capital Raising and Liquidity
RIOT's financial liquidity remains strong, with $290 million in cash and 7,327 Bitcoin on hand, representing nearly $500 million in combined liquidity. The company's At-the-Market (ATM) Offering in August 2023 raised substantial capital, with net proceeds of approximately $126.0 million from the sale of shares during Q3 2023, and an additional $101.1 million post-quarter end.
Non-GAAP Financial Measures
The company also provided non-GAAP financial measures such as Adjusted EBITDA, which for Q3 2023 was $31.6 million, a significant increase from $4.3 million for the same period in 2022. These measures are intended to provide additional insight into RIOT's core business operations by excluding certain non-cash and non-recurring items.
In conclusion, Riot Platforms Inc (RIOT, Financial) has demonstrated strategic execution in its power strategy and capital raising efforts, leading to a record hash rate capacity and a solid financial position. Despite the net loss for the quarter, the company's reduced cost of Bitcoin mining and strong liquidity highlight its potential for long-term growth and resilience in the dynamic cryptocurrency mining industry.
Explore the complete 8-K earnings release (here) from Riot Platforms Inc for further details.
