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Riot Platforms Reports Significant Losses in Q2
In the second quarter of this year, Riot Platforms faced a considerable net loss of $84.4 million, marking a stark increase from the $27.4 million loss recorded in the same quarter of the previous year. This escalation in losses is largely attributed to the ongoing effects of April’s Bitcoin halving event.
Financial Overview for Q2
The quarterly financial report revealed that Riot generated a total revenue of $70 million during the second quarter of 2024, down from $76.7 million in Q2 of 2023. This decline was primarily due to a $9.7 million decrease in Engineering revenue, which was somewhat counterbalanced by a $6 million increase in Bitcoin mining revenue.
During this period, the company managed to produce 844 Bitcoin, reflecting a significant 52% drop from the 1,775 BTC mined in the same quarter last year. This reduction can be linked to the Bitcoin block subsidy halving that occurred in April 2024, alongside a rise in network difficulty.
Rising Costs and Revenue Growth
The average direct cost associated with mining a single Bitcoin surged to $25,327, a substantial increase from $5,734 in Q2 of 2023. This rise in costs was influenced by the halving event and a 68% increase in the global network hash rate. Nonetheless, Riot reported an increase in mining revenue, which reached $55.8 million, compared to $49.7 million in the previous year. This growth was attributed to higher average Bitcoin prices and an enhanced operational hash rate.
Financial Stability
Riot asserted its robust financial standing, boasting $646.5 million in working capital, which includes $481.2 million in cash reserves. The company also holds 9,334 unencumbered Bitcoins, valued at approximately $585 million, all of which were mined through its own operations.
CEO’s Insights on Market Conditions
Riot’s CEO, Jason Les, remarked, “The second quarter was marked by the Bitcoin network halving that took place in April this year, an event that reduces the Bitcoin block subsidy received by miners by half every four years. Despite this reduction in production capacity for all Bitcoin miners, Riot managed to achieve $70.0 million in revenue for the quarter while maintaining strong gross margins in our core Bitcoin mining operations.”
Strategic Acquisition of Block Mining
Recently, Riot completed the acquisition of Block Mining, a Kentucky-based firm, in a deal valued at $92.5 million. The transaction included $18.5 million in cash from Riot’s reserves and $74 million in common stock.
This acquisition has resulted in an immediate boost to Riot’s hash rate, expansion of its operational footprint, and entry into additional energy markets beyond the Electric Reliability Council of Texas (ERCOT) region.
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