Bitdeer Technologies Reports Q2 2024 Financial Resilience Amid Bitcoin Market Challenges

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Bitcoin miner Bitdeer Technologies Group (BTDR) has shared its financial results for Q2 2024. Despite facing tough conditions in the mining industry after the recent Bitcoin halving event, Bitdeer has shown resilience.

Bitcoin reached a high of over $73,000 in March. Now, it has pulled back but is still up 133% compared to last year. Bitdeer reported year-over-year growth in revenue, gross profit, and adjusted EBITDA, even though it also recorded a net loss.

In Q2, Bitdeer’s total revenue was just under $100 million. That’s about a 6% increase from $93.8 million last year. This growth mainly came from Bitdeer’s self-mining division, which nearly doubled its revenue to $41.6 million, up from $21.6 million a year ago. The company mined 628 Bitcoins in this quarter and usually sells them for cash soon after.

The increase in self-mining revenue was driven by two factors. First, the self-mining hashrate jumped to 7.3 EH/s from 3.8 EH/s at its Bhutan facility. Second, the price of Bitcoin was favorable. This facility started operating in the second half of 2023.

However, Bitdeer’s cloud hash rate revenue dropped sharply by 33% this quarter. This decline was due to broader market conditions affecting active orders and lower electricity subscriptions. These changes were a result of lower margins after the Bitcoin halving in April. The halving event also led to temporary shutdowns of hosting mining rigs, which pressured overall hosting revenue. Importantly, any hash rate allocated to cloud mining returns to self-mining when those contracts expire.

On the bright side, Bitdeer remains profitable on an adjusted EBITDA basis. That figure came in at $24.9 million, a 25% increase from last year. For Q2, the company’s gross profit was $24.4 million, which is 50% higher than $16.2 million in the same quarter last year.

Still, Bitdeer reported a net loss of $17.7 million for the quarter. This is an improvement compared to a net loss of $40.4 million in the same period last year. The recent loss was linked to a non-cash expense related to warrants from its partnership with Tether. These warrants could be converted to equity, potentially offsetting some liabilities.

The company continues to invest in research and development, spending around $5 million to $6 million to optimize its SEALMINER technology and upgrade its global datacenters.

At the end of the quarter, Bitdeer had nearly $204 million in cash and cash equivalents, including about $25 million in cryptocurrency. In a capital-intensive industry, the company directed $17.5 million into its products and mining machines during the quarter. As production ramps up, Bitdeer aims to balance these investments while growing revenue.

Matt Kong, Bitdeer’s Chief Business Officer, commented, “We achieved these results despite significant growth in the global network hashrate and the April 2024 halving. This shows the strength of our unique strategy, driven by our commitment to technology and innovation.”

Bitdeer is working on several datacenter projects in the United States, Norway, and Bhutan, all on track for completion. The company is focused on expansion and expects these projects to support its growth for years to come. In its power and data center infrastructure business, Bitdeer signed a 30-year lease for 570 MW of power capacity in Ohio, enhancing its overall capacity.

This year, Bitdeer also launched a high-performance computing (HPC) and AI business. They deployed Nvidia systems in Singapore and achieved a 100% utilization rate at the start of Q3.

During Q2, Bitdeer advanced its SEALMINER ASIC roadmap, including acquiring crypto ASIC design company Desiweminer. The company has started mass production of its SEALMINER A1 chips, aiming to add 3.4 EH/s to its datacenters by the end of 2024.

Bitdeer expects to receive its second-generation SEAL02 chip products by the end of Q3. After that, they plan to ramp up production for deployment by year-end. Once these chips are available, Bitdeer anticipates immediate cash flow from customer pre-orders.

Despite uncertainties about Bitcoin's price in 2024, Bitdeer believes it has a solid roadmap. This plan includes ambitious goals for its self-mining operations, ASIC miner technology, cloud capabilities, and AI-powered data centers. Although Bitdeer’s stock is currently below its 52-week high, Wall Street analysts have an average “buy” rating on BTDR shares, suggesting there’s room for growth.

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