Disappointing Q2 earnings send shares of Bitcoin Miner Hut 8 plummeting

on Aug 14, 2023
  • Hut 8 saw its Bitcoin production decrease by 58% compared to the same period last year.
  • Hut 8 blames increased Bitcoin network difficulty for the decrease in production.
  • Rival miner Riot Blockchain posted a 27% increase in Bitcoin production in Q2 compared to a year ago.

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    Following the release of disappointing Q2 earnings results, Hut 8 (TSX: HUT), a Toronto-based Bitcoin mining company, had its shares drop 8% on Monday.

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    The company reported that it mined 399 BTC during the quarter that ended on June 30; a decrease of 58% from the same time last year. This caused the Bitcoin mining company’s revenue to decrease by $24.6 million, from $43.8 million in Q2 2022 to $19.2 million in Q2 2023.

    Increased Bitcoin difficulty

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    According to the Bitcoin miner, the decline in mined Bitcoin was mostly caused by problems with particular mining operations and an increase in the Bitcoin network’s difficulty between each session. The company also recently vacated its North Bay facility with 7,000 mining machines back in March, halting 680 petahashes per second (PH/s) of mining capacity, due to a legal dispute with its power supplier.

    At the company’s Drumheller facility, however, “high energy input levels” and “equipment failures” in addition to high energy rates in May prompted it to curtail operations to just 20% of on-site capacity. The company has also added “custom firmware” to all of its mining equipment to make sure that its fleet “operates within safe limits.”

    There is also the impact of Ethereum shifting to proof of stake in September last year, which reduced the amount of money the company received from cryptocurrency mining operations. The firm was forced to halt its GPU-related mining activities.

    Despite the many challenges, however, the company’s CFO Sherif Visram stated that the company was successful in strategically managing its costs.

    As of June 30, Hut 8’s total self-mined Bitcoin balance held in custody or as collateral was 9,136 BTC (worth about $368.7 million).


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