Riot Platforms, a Bitcoin mining firm, has reported a net income of $211.8 million for the first quarter of 2024, marking a significant increase of 1,000% compared to the same period last year. However, the company fell short of analyst revenue estimates.
The released results for the first quarter, announced on May 1, show that mining revenue surged by 55.4% year-on-year to reach $74.6 million. This increase was primarily driven by a 131% rise in the price of Bitcoin. Despite this, Riot’s total revenue of $79.3 million fell short of estimates by research firm Zacks, falling 14% below expectations.
Riot attributed the slower growth in net income and mining revenue to lower Bitcoin production and higher mining costs. This was caused by the increase in Bitcoin’s network difficulty and hash rate. The firm’s unaudited financial statement for the first quarter of 2024 reflects these challenges.
During the first quarter, Riot mined 1,364 BTC, which represents a 36% decrease compared to the same period in 2023. The average cost to mine 1 BTC was $23,000, marking a 144% increase from the previous year. Riot stated that this increase was primarily due to an 89% rise in the global network hash rate.
In a recent announcement, Riot unveiled its plans for a new facility in Corsicana, Texas. CEO Jason Les believes that once fully developed, this facility will become the largest dedicated Bitcoin mining facility in the world. The company aims to increase its hash rate capacity from 12.4 exahashes per second (EH/s) to 31 EH/s by the end of the year. It also anticipates a further increase to 41 EH/s when the Corsicana facility is fully deployed in 2025. Riot’s long-term goal is to reach a hash rate of 100 EH/s in 2027 or shortly thereafter.
As of now, Riot ranks third in terms of hash rate among miners, trailing behind Marathon Digital and Core Scientific, with hash rates of 24.7 EH/s and 16.9 EH/s, respectively, according to Hashrate Index.
Following the release of the first-quarter results, Riot’s share price experienced a 2.87% decline on May 1, falling to $9.82. However, it has since seen a 1.1% increase in after-hours trading, according to Google Finance.
Bitcoin miners, including Riot, are adjusting to the reduced mining rewards resulting from the halving event on April 20. The event reduced the mining rewards from 6.25 BTC to 3.125 BTC, with the latter currently valued at approximately $180,600.
In summary, Riot Platforms, a Bitcoin mining firm, reported impressive net income growth for the first quarter of 2024. Despite missing revenue estimates, the company attributes the slower growth to challenges such as lower Bitcoin production and higher mining costs. Riot’s plans for expanding its hash rate capacity and the launch of a new facility in Texas demonstrate its commitment to future growth in the Bitcoin mining industry.