Canaan’s 2Q mining revenue jumps 43% on 1Q, but net loss climbs 31%

August 29, 2023 Coin Telegraph

Bitcoin

Bitcoin mining firm Canaan posts second quarter financials, with Bitcoin mining revenue up 43% from Q1 2023, though net loss also rose 31% to $110 million.

Bitcoin mining company Canaan announced its unaudited financial results for Q2 2023, showing growth in computing power sold and BTC mining revenues while it tackled a significant net loss of $110 million. up 31% on Q1.

The NASDAQ-listed company outlined a variety of reasons influencing increased revenues and a significant headwind that included an inventory write-down and equipment impairment totaling $54 million.

Canaan recorded $73.9 million in revenue in Q2 2023, up from $55.2 million quarter-on-quarter. This consisted of $57.9 million from products revenue and $15.9 million in Bitcoin mining revenue.

BTC mining revenues reflected 43.3% growth compared to Q1’s $11.1 million, with Canaan’s 2023 Q2 more than doubling Q2 2022's $7.8 million in BTC mining revenues. The company attributed this surge to the recovery in Bitcoin prices and the consequent rise in Bitcoin rewards.

“The sequential increase was mainly driven by the Bitcoin price recovery and increased Bitcoin rewards across the network during the quarter.”

Canaan also reported significant growth in its total computing power sold, reaching 6.1 million Thash/s, up 45% quarter-on-quarter, with the sector becoming a major driver of revenue for the company.

Canaan also detailed net losses totalling $110.7 million in Q2, which it attributed to non-cash accruals and provisions reflecting changes in selling prices, regulatory shifts, and partner agreements.

Canaan CFO James Jin Cheng added that the losses included inventory write-down, provision for commitment reserve and impairment of property and equipment which totaled US$54.7 million.

“These non-cash accruals and provisions reflect our consideration of the latest selling price change, regulation changes in Kazakhstan, and the default by the partner at a U.S. project, which did not influence our cash flow.”

As of June 2023, Canaan’s listed cryptocurrency holdings included 1,125 BTC valued at US$28.8 million. 747 BTC are owned by Canaan, while 378 BTC are attributed to customer deposits.

Canaan also reported that it had suspended 2.0 exahash/s of its mining computing power based in Kazakhstan to ensure legal compliance with the Rules for Licensing of Digital Mining Activities coming into effect.

The company is in the process of obtaining a specialized license to continue its operations and expects a reduction in its Q3 BTC generation as a result of the offline hardware.

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Bitcoin Depot Q2 revenue jumps 18% y/y as it plans ATM adds after NASDAQ listing

August 15, 2023 Coin Telegraph

Bitcoin ATM

Bitcoin Depot records $197.5 million in revenue in the second quarter for 2023 spurred on by partnerships with various American retail stores.

United States based Bitcoin (BTC) ATM operator Bitcoin Depot said it posted best ever revenue numbers in the second quarter of 2023 as the company looks to expand its footprint after recently being listed on the NASDAQ.

Bitcoin Depot released its Q2 results in line with a number of cryptocurrency ecosystem firms, recording $197.5 million in quarterly revenue. The company notes that this is a record figure and an 18% increase from its revenue for the same period in 2022.

The company also reported that its net loss of $6.1 million was down by 249% year-over-year. Its second quarter profit stood at $25.9 million, while its gross profit margin was 13% for Q2 2023, up from 8% for the same period last year.

Bitcoin Depot founder and CEO Brandon Mintz said the company would be looking to continue growing through 2023 following its public listing on the NASDAQ. The listing took place on July 3 following the closing of a business merger with GSR II Meteora Acquisition Corp.

Bitcoin Depot has also announced a number of partnerships with convenience stores across the U.S., with an aim of increasing the number of Bitcoin access points across the country. Bitcoin Depot also carried out a software conversion of its ATM machines in February 2023 to BitAccess. The conversion reportedly cut out previous annual licensing fees which were incurring extra costs.

Bitcoin Depot is also building out its BDCheckout service as well as other software and operational services, which has allowed the company to tap into revenue streams from kiosk management software.

The company is forecasting a total revenue up to $730 million in 2023, which it tips as 13% improvement on its 2022 total of $647 million.

Data reflecting the net number Crypto ATMs globally. Source: Coin ATM Radar.

As Cointelegraph previously reported, the Bitcoin ATM market took a downturn in regards to the number of operational machines across the U.S. in the first half of 2023. This trend took a positive turn in May 2023, with over 1000 BTC ATM installations reportedly taking place according to data from Coin ATM Radar.

Bitcoin ATM growth began a downward turn in late 2022, with the BTC ATM ecosystem recording negative growth in global net installations for the first time ever.

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Marathon Digital Q2 results miss revenue and earnings forecasts

August 9, 2023 Coin Telegraph

2023

Despite the earnings miss, Marathon's CEO said it mined a record 2,926 Bitcoin over the second quarter of 2023.

Crypto mining firm Marathon Digital missed earnings and revenue expectations with its second-quarter 2023 results.

Marathon's Q2 2023 results on Aug. 8 reported revenues of $81.8 million compared to Zacks Investment Research's estimate of $83.2 million.

The crypto miner reported a earnings per share net loss of 13 cents compared to Zacks' estimate of a 3 cents per share loss.

Marathon's share price largely remained sideways after market close, recording a 1.65% drop in after-hours trading to around $15.50 per share according to Google Finance.

*Marathon's share price largely remained sideways after market close. Source: Google Finance*

Marathon’s chairman and CEO Fred Thiel said in a press release that the firm significantly grew its hash rate and improved efficiency over the quarter.

“In Q2, we grew our energized hash rate 54% from 11.5 to 17.7 exahashes," Thiel reported. He added Marathon also increased its Bitcoin (BTC) production with a record 2,926 Bitcoin mined during the quarter, representing around 3.3% of the network's rewards over that time.

Marathon reported a $23.4 million gain due to selling 63% of the Bitcoin mined in the quarter, used to fund operating costs. Impairment charges on the value of its held digital assets were $8.4 million.

This is a developing story, and further information will be added as it becomes available.

Nvidia cites limited visibility into crypto mining’s impact on Q2 results

August 25, 2022 Coin Telegraph

Coin Telegraph

Nvidia's CFO said falling crypto prices and changes in consensus mechanisms have in the past impacted demand for its products and the company's ability to estimate it.

Graphics card giant Nvidia CFO Colette Kress says the company has been unable to estimate reduced crypto mining demand impacted its Q2 results, which fell short of analyst expectations on Wednesday.

The chip giant released its financial results for the three months ended Jul. 31y, which revealed a 19% quarter-on-quarter drop in revenue to $6.5 billion, while net income fell 59% to $656 million.

Revenue for its gaming division, which includes sales of its high-end GPUs, fell 44% in revenue from the previous quarter to $2.04 billion, which Nvidia attributed to “challenging market conditions.”

Kress, who also serves as executive vice president of the company, said Nvidia has limited visibility on how the crypto market affects the demand for their gaming products:

"Our GPUs are capable of cryptocurrency mining, though we have limited visibility into how much this impacts our overall GPU demand.”

“We are unable to accurately quantify the extent to which reduced cryptocurrency mining contributed to the decline in Gaming demand,” she added.

While the chip giant’s graphic processing units (GPUs) were designed for gaming purposes, high demand for crypto mining activities over the past few years has contributed to a 320% increase in the company’s share price over the last five years.

Kress said, however, that falling crypto prices and changes in consensus mechanism have in the past impacted demand for its products and the ability to estimate it.

“Volatility in the cryptocurrency market – such as declines in cryptocurrency prices or changes in method of verifying transactions, including proof of work or proof of stake — has in the past impacted, and can in the future impact, demand for our products and our ability to accurately estimate it.”

With the Ethereum Merge scheduled for Sep. 15, the network’s consensus change to proof-of-stake (PoS) could further drive down the demand for crypto mining hardware. This could spell trouble for cryptocurrency mining products such as Nvidia’s CMP170 HX which currently costs around $4,695.

That being said, cryptocurrencies such as Bitcoin, Litecoin, Monero, and Dogecoin are among the networks still operating on proof-of-work consensus mechanisms with no observable plans to transition in the future.

Nvidia’s share price has also dropped 5.89% over the last 5 days on the NASDAQ.

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‘This is on me’ — Robinhood CEO to lay off 23% of staff after Q2 loss

August 3, 2022 Coin Telegraph

Coin Telegraph

The online retail broker blamed the economy for a decline in user numbers and net revenue that fell 44% year-on-year, although revenue from crypto rose moderately this quarter.

Online brokerage Robinhood will lay off nearly a quarter of its employees, citing a continued deterioration of the macro environment and a broad crypto market crash.

The bad news came in a blog post on August 2 from cofounder and CEO Vlad Tenev, on the same day it released tepid Q2 financial results, while the New York Department of Financial Services announced a $30 million fine for the company’s crypto branch due to alleged anti-money laundering, cybersecurity, and consumer protection violations.

Tenev wrote that the layoffs would impact all functions in the company, particularly operations, marketing, and program management, with around 23% of the staff let go. The Financial Times estimated the number of employees impacted to be around 780.

"Departing Robinhoodies will be offered the opportunity to remain employed with Robinhood through October 1, 2022 and receive their regular pay and benefits. They will also be offered job search assistance (including an opt in Robinhood Alumni Talent Directory)."
— zerohedge (@zerohedge) August 2, 2022

Robinhood laid off 9% of its staff earlier this year, but Tenev said the cuts “did not go far enough." He pointed to economic conditions and the collapse of the crypto market as factors in the move.

“This has further reduced customer trading activity and assets under custody.”

In addition, the company had wrongly assumed the heightened engagement seen during the beginning of the COVID-19 pandemic would continue. Tenev wrote:

“As CEO, I approved and took responsibility for our ambitious staffing trajectory — this is on me.”

The company issued its quarterly financial results a day earlier than scheduled. Results were disheartening, with $318 million in net revenue, down 44% year-on-year, although up 6% over the last quarter. Net loss was $295 million, narrowed from a net loss of $502 million in Q2 2021.

Monthly active users were down 1.9 million from last quarter to 14.0 million in June, and assets under custody dropped 31% to $64.2 billion in that time.

Revenue from cryptocurrency rose 7% quarter-on-quarter to $58 million, however.

Robinhood enjoyed a significant spike in share price in May after FTX founder and CEO Sam Bankman-Fried paid $650 million for a 7.6% stake in the company. Share prices fell more than 4% Tuesday in after-hours trading, according to FT.

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Experts reveal what Tesla’s $936M sell-off means for Bitcoin

July 21, 2022 Coin Telegraph

<div>Experts reveal what Tesla's 6M sell-off means for Bitcoin</div>

Coin Telegraph

Telsa CEO noted that the sale “should not be taken as a verdict on Bitcoin” and is “certainly open to increasing our Bitcoin holdings in the future.”

Crypto industry experts are largely unfazed by Tesla’s decision to sell 75% of its Bitcoin (BTC) holdings, saying it’s a fairly typical strategy for companies to improve cash flow during economic slowdowns.

On Wednesday, the electric vehicle manufacturer revealed that it had sold 75% of its Bitcoin holdings in Q2, adding $936 million in fiat to its balance sheet.

During a conference call, Tesla CEO Elon Musk noted that the sale “should not be taken as a verdict on Bitcoin,” explaining that the move was due to liquidity concerns given the continued Covid lockdowns in China.

“The reason we sold a bunch of our Bitcoin holdings was that we were uncertain as to when the Covid lockdowns in China would alleviate. So it was important for us to maximize our cash position.”

“We are certainly open to increasing our Bitcoin holdings in the future.”

Asked by investors during the earnings call whether he saw Bitcoin as a long-term asset, Musk said the cryptocurrency was a “sideshow to the sideshow” of Tesla’s main goal, which is “to accelerate the advent of stable energy.”

“Cryptocurrency is not something we think of a lot,” he said.

Markus Thielen, chief investment officer at Singapore-based digital asset manager IDEG told Cointelegraph that Tesla likely sold off its Bitcoin as it was “seen as a distraction from their core business.”

“I would not be surprised if Tesla keeps nibbling in Bitcoin when Bitcoin stabilizes, otherwise they would have sold 100%.”

Comparison site Finder’s share trading expert Kylie Purcell explained that the electric car manufacturer hasn’t been alone in its decision to “shore up capital in cash currencies.”

“With the world heading into an economic slowdown and possibly a recession, it’s not unusual for investors and companies to move capital away from more volatile assets into fiat currency,” she noted.

She also added that while the price of Bitcoin dipped following the announcement, there are already signs of recovery.

On Wednesday, Bitcoin’s price fell approximately 2.6% following Tesla’s announcement and has returned to $23,299 at the time of writing — tracking close to its one-month high, meaning that the crypto community may not have been too concerned by the announcement.

So Tesla has already sold off their inventory, appears to have mainly done so to maintain positive cash flow (non bitcoin-centric reasons), and still has 25% of their BTC.

Maybe I’m coping but seems like a nothingburger.
— Will Clemente (@WClementeIII) July 20, 2022

The muted reaction to the sale played out differently to the announcement in February last year that Telsa had scooped up $1.5 billion in BTC to add to its balance sheet and was planning on accepting Bitcoin as payment for certain products (though this was later scrapped).

The news at the tim saw Bitcoin’s price immediately jump by almost $3,000, bringing the cryptocurrency to a new all-time high above $43,000.

Swyftx’s head of strategic partnerships, Tommy Honan told Cointelegraph that Tesla’s decision to buy Bitcoin last year was “as important a moment as you can imagine for digital assets.”

“It almost gave other businesses permission to put crypto on their balance sheets and we saw a lot of big institutional investors, as well as small and mid-cap companies flood into the market from that point.”

“Musk said the sale wasn’t a verdict on Bitcoin, just a cash play, and it looks like the market has taken him at his word. Bitcoin’s price has stabilized over the last 24 hours and we’d be surprised if other big investors followed suit, especially given the current price of Bitcoin.”

Q2

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