CleanSpark (CLSK) Q3 2024 earnings summary

Executive summary

• Revenue rose 129% year-over-year to $104.1 million for the quarter, driven by increased hashrate and operational efficiency, maintaining revenue above $100 million for the second consecutive quarter.

• Net loss for the quarter was $236.2 million, primarily due to a $189.2 million impairment charge on older mining equipment and a $48.3 million loss from bitcoin fair value adjustments.

• Adjusted EBITDA was negative $12.7 million, reversing positive results from prior periods, mainly due to non-cash adjustments.

• Operational hash rate grew to over 22 EH/s, surpassing targets, with strategic fleet upgrades and expansion into Tennessee and Wyoming.

• Secured a $50 million revolving line of credit with Coinbase, collateralized by bitcoin holdings.

Financial highlights

• Quarterly revenue: $104.1 million, up from $45.4 million year-over-year; gross margin reached 57%.

• Net loss: $236.2 million, or $1.03 per share, driven by non-cash impairments and bitcoin revaluation.

• Produced 1,583 bitcoin, down 22% sequentially due to halving, but outperformed the 50% reduction in block rewards.

• Cash and equivalents at quarter-end: $129.2 million; bitcoin holdings at fair value: $413 million; working capital: $531.9 million.

• Energy cost to mine bitcoin at wholly-owned sites was $27,000 per coin, with all-in cost under $44,000 and average revenue per coin at $66,000.

Outlook and guidance

• On track to exceed 32 EH/s by year-end, with a clear path to 50 EH/s in 2025 as new miners are deployed and infrastructure expands.

• Infrastructure expansion in Tennessee and Wyoming targeted to reach 200 MW in 2025 and over 400 MW by 2026.

• Sufficient liquidity is anticipated for at least the next twelve months, supported by cash, bitcoin sales, and equity financing.

• Additional 22.8 EH/s of new S21 XP miners secured, with 7.8 EH/s to be delivered by year-end.

• Ongoing focus on maximizing mining efficiency and expanding operations in new states.