CleanSpark (CLSK) stock fell more than 9.4% in pre-market trading on Tuesday after the US Bitcoin mining company reported that its second-quarter net loss widened to $378.3 million. This was affected by a significant non-cash adjustment to digital asset holdings.
The company reported a net loss of $378.3 million for the quarter ended March 31, significantly widening from a loss of $138.8 million in the same period a year ago. The loss of $1.52 per share was more than triple the 41 cent loss expected by analysts.
The company’s bottom was primarily driven by a $224.1 million non-cash Bitcoin fair value loss that reflected market volatility.
Quarterly sales reached $136.4 million, down 25% from $181.7 million a year ago and below expectations of $154.3 million, the report said.
Despite the drop, CleanSpark expanded its infrastructure and doubled its contracted megawatts (MW). CEO Matt Schutz said the company is pivoting to commercializing “AI/HPC-enabled assets,” joining an industry-wide shift to leasing computing power as AI data centers.
CFO Gary Vecchiarelly cited the company’s balance sheet as a “competitive advantage” and reported that its Bitcoin holdings increased 14% from last year to $925.2 million. Total assets are currently $2.9 billion and long-term debt is $1.8 billion, while cash is $260.3 million.
According to Checkonchain’s difficulty regression model report, the estimated average cost to mine one Bitcoin was $88,000 as of mid-March. The current Bitcoin price is hovering at over $80,000, which means that most Bitcoin mining companies are operating in the red.
These economic conditions have forced Bitcoin miners to pivot towards artificial intelligence and high-performance computing infrastructure. The Bitcoin mining industry had underwritten approximately $70 billion in such contracts by late March.
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