Riot Announces July 2024 Production and Operations Updates

Rhea-AI Summary

Riot Platforms, Inc. (NASDAQ: RIOT) announced its July 2024 production and operations updates. Key highlights include:

• Produced 370 Bitcoin, a 45% increase from June
• Expanded operations into Kentucky through acquisition of Block Mining
• Increased total deployed hash rate to 23.3 EH/s, up 6% month-over-month and 118% year-over-year
• Raised 2024 deployed hash rate guidance from 31 EH/s to 36 EH/s
• Anticipates reaching 56 EH/s total self-mining capacity by 2025

The company continues to develop its Corsicana Facility and participates in ERCOT's Four Coincident Peak Program for power management.

Positive

• 45% increase in Bitcoin production from June to July (370 BTC)
• 6% increase in total deployed hash rate to 23.3 EH/s
• Acquisition of Block Mining, adding 1 EH/s and expanding into Kentucky
• Raised 2024 deployed hash rate guidance to 36 EH/s
• Anticipates reaching 56 EH/s total self-mining capacity by 2025

Negative

• 10% decrease in Bitcoin production compared to July 2023
• 35% decrease in total power credits from $5.2 million in June to $3.4 million in July
• 33% increase in all-in power cost from 2.6c/kWh in June to 3.4c/kWh in July

Insights

Financial Analyst

Riot's July 2024 update reveals mixed results. The company's Bitcoin production increased by 45% month-over-month to 370 BTC, showcasing improved operational efficiency. However, this is still 10% lower than July 2023's production. The expansion into Kentucky through the Block Mining acquisition adds 1 EH/s of immediate hash rate, with potential for significant growth.

Financially, Riot's decision to hold all produced Bitcoin this month, compared to selling 400 BTC in July 2023, suggests confidence in future price appreciation. The company's Bitcoin holdings increased by 33% year-over-year. However, power costs have risen substantially, with the all-in power cost increasing by 109% year-over-year to 3.4c/kWh, which could pressure margins.

Riot's aggressive expansion plans, aiming for 36 EH/s by end of 2024 and 56 EH/s by 2025, indicate strong growth potential but also increased capital expenditure requirements. Investors should monitor the company's ability to finance this growth and manage rising operational costs.

Energy Market Analyst

Riot's power strategy as a flexible consumer is noteworthy. By participating in ERCOT's Four Coincident Peak Program, Riot can potentially achieve significant cost savings. However, the 57% year-over-year decrease in total power credits to $3.4 million is concerning, as it may indicate reduced opportunities for cost mitigation.

The company's expansion into Kentucky diversifies its energy market exposure beyond Texas. This could provide geographical hedging against regional power issues. However, the all-in power cost in Kentucky (3.6c/kWh) is higher than Riot's Texas operations, which may impact profitability in this new market.

The rising power costs across all operations are a red flag. With total all-in power costs increasing by 109% year-over-year, Riot's ability to maintain profitability in a volatile Bitcoin market could be challenged. The company's future success will heavily depend on its ability to optimize power consumption and secure favorable energy contracts in its expansion markets.

Technology Analyst

Riot's technological advancements are impressive. The company has more than doubled its deployed hash rate year-over-year, reaching 23.3 EH/s. The Corsicana Facility's immersion cooling systems and MicroBT miners are showing strong performance, which bodes well for future efficiency gains.

The acquisition of Block Mining not only adds immediate hash rate but also brings new technological expertise in vertically-integrated mining operations. This could lead to synergies and improved operational efficiencies across Riot's portfolio.

However, the gap between deployed and average operating hash rates remains significant. In July, the average operating hash rate was only 15.5 EH/s out of 23.3 EH/s deployed. Improving this utilization rate will be important for maximizing returns on Riot's substantial infrastructure investments. The company's ability to scale operations effectively while maintaining technological edge will be key to its competitive position in the rapidly evolving Bitcoin mining landscape.

Riot Produces 370 Bitcoin in July 2024 and Expands into Kentucky

CASTLE ROCK, Colo., Aug. 5, 2024 /PRNewswire/ --

Riot Platforms, Inc. (NASDAQ: RIOT) ("Riot" or "the Company"), an industry leader in vertically integrated Bitcoin ("BTC") mining, announces unaudited production and operations updates for July 2024.  

Bitcoin Production and Operations Updates for July 2024
							Comparison (%)
	Metric		July 2024 1	June 2024 1	July 2023		Month/Month	Year/Year
	Bitcoin Produced		370	255	410		45 %	-10 %
	Average Bitcoin Produced per Day		11.9	8.5	13.2		40 %	-10 %
	Bitcoin Held 2		9,704	9,334	7,275		4 %	33 %
	Bitcoin Sold		-	-	400		N/A	N/A
	Bitcoin Sales - Net Proceeds		-	-	$12.1 million		N/A	N/A
	Average Net Price per Bitcoin Sold		N/A	N/A	$30,293		N/A	N/A
	Deployed Hash Rate - Rockdale 2		14.7 EH/s	14.7 EH/s	10.7 EH/s		0 %	37 %
	Deployed Hash Rate - Corsicana 2		7.6 EH/s	7.3 EH/s	-		4 %	N/A
	Deployed Hash Rate - Kentucky 2,3		1.0 EH/s	N/A	N/A		N/A	N/A
	Deployed Hash Rate - Total 2		23.3 EH/s	22.0 EH/s	10.7 EH/s		6 %	118 %
	Avg. Operating Hash Rate - Rockdale 4		9.6 EH/s	7.7 EH/s	5.4 EH/s		24 %	78 %
	Avg. Operating Hash Rate - Corsicana 4		5.7 EH/s	3.6 EH/s	-		57 %	N/A
	Avg. Operating Hash Rate - Kentucky 3,5		0.9 EH/s	N/A	N/A		N/A	N/A
	Avg. Operating Hash Rate - Total 4		15.5 EH/s	11.4 EH/s	5.4 EH/s		37 %	188 %
	Power Credits 6		$3.2 million	$4.7 million	$6.0 million		-32 %	-47 %
	Demand Response Credits 7		$0.2 million	$0.5 million	$1.8 million		-59 %	-89 %
	Total Power Credits		$3.4 million	$5.2 million	$7.8 million		-35 %	-57 %
	All-in Power Cost - Rockdale 8		3.0c/kWh	2.4c/kWh	1.6c/kWh		26 %	79 %
	All-in Power Cost - Corsicana 8		3.9c/kWh	3.7c/kWh	N/A		5 %	N/A
	All-in Power Cost - Kentucky 8,9		3.6c/kWh	N/A	N/A		N/A	N/A
	All-in Power Cost - Total 8		3.4c/kWh	2.6c/kWh	1.6c/kWh		33 %	109 %
1.	Unaudited, estimated.
2.	As of month-end.
3.	Includes self-mining capacity hosted outside of Kentucky.
4.	Average over the month.
5.	Average from July 24 to 31, where Riot held 100% ownership of the Kentucky assets.
6.	Estimated power curtailment credits.
7.	Estimated credits received from participation in ERCOT and MISO demand response programs.
8.	Estimated. Inclusive of all transmission and distribution charges, fees, adders, and taxes. Net of Total Power Credits.
9.	All-in power cost from July 24 to 31, for Kentucky assets.

"July was a major step forward for Riot, as we increased our Bitcoin production 45% over June and completed a new acquisition, expanding our operations into a new market," said Jason Les, CEO of Riot. "Riot mined 370 Bitcoin during July, a significant month-over-month increase, demonstrating improved results from the significant deployment of hash rate at our Corsicana Facility at the end of June. We are seeing strong performance from the immersion systems and MicroBT miners at our Corsicana Facility, and expect results to further improve as the commissioning process completes and all cooling systems become fully operational. Combined with ongoing improvements at our Rockdale Facility, we remain on path to significantly enhance operating uptime as the year progresses. 

"During July, Riot also announced the acquisition of Block Mining, a vertically-integrated private miner operating in Kentucky. From this acquisition, Riot immediately added 1 EH of self-mining capacity and will begin to add additional hash rate based on already available capacity at the newly acquired Kentucky facilities. Work to expand into the power capacity available is underway, and we anticipate reaching 5 EH/s of hash rate capacity in Kentucky by the end of this year."

Riot's Power Strategy Overview

Riot's power strategy is based on being a flexible consumer of power. The Company typically consumes power when it is low-cost and abundant, as opposed to residential consumers, who typically increase power usage during peak periods of demand. When demand increases and/or supply decreases, causing prices to rise, the Company can either power down to reduce power costs, or bid competitively to provide the grid operator with visibility into, and control over, Riot's power utilization. This control gives the grid operator the ability to either absorb excess power when supply is high or to curtail Riot's operations in order to reduce demand when beneficial to the grid, and ultimately, to all consumers.

During July, Riot continued its participation in ERCOT's Four Coincident Peak Program ("4CP"). The 4CP program is an opportunity for users of power to curtail usage during periods of highest demand on the grid in each of the four summer months of the year. Riot curtailed operations in July during peak periods of demand within ERCOT and will continue to do so throughout the summer. These periods of curtailment occur whenever total demand on the grid could reach its peak point for each month and does not depend on the current price for power, which fluctuates due to a variety of factors and may be lower or higher than anticipated.  As part of Riot's participation in this voluntary program, the Company can achieve substantial savings on future costs, and participation is a key part of the Company's partnership-driven approach with the grid and all consumers of power in ERCOT. 

Infrastructure Update

Riot is currently developing Phase 1 of the Company's second large-scale facility, the Corsicana Facility, which is expected to total 400 megawatts ("MW") of developed mining capacity upon completion of this initial phase. Once fully developed, the Corsicana Facility is expected to total 1 gigawatt (1,000 MWs) in total developed mining capacity.

Buildings A1 and A2 are fully energized and operational, while deployment and energization continues in Building B1. Building B2 is currently under construction and miner deployment is expected to begin in September. 

Estimated Hash Rate Growth    

Riot anticipates achieving a total self-mining hash rate capacity of 36 EH/s by the end of 2024.

On April 18^th, Riot announced the successful energization of the Corsicana Facility substation. The Corsicana Facility will have a total capacity of 1 GW when fully developed, at which point it is expected to be the largest known Bitcoin mining facility in the world by developed capacity. The recently energized substation will power the initial 400 MW phase of development of the Corsicana Facility. This initial phase is expected to add 16 EH/s to Riot's self-mining capacity by the end of 2024.

On July 23^rd, Riot announced the acquisition of Block Mining. The transaction immediately increases Riot's hash rate by 1 EH/s and establishes an additional arm of growth for Riot in new jurisdictions and energy markets, starting in Kentucky. The acquisition includes 60 MW of existing operational capacity with potential to expand to over 300 MW in total in Kentucky. Riot's immediate focus will be on integrating Block Mining's operations and team into Riot and providing support towards near-term expansion opportunities.

Following the Block Mining acquisition, Riot raised its 2024 deployed hash rate guidance from 31 EH/s to 36 EH/s, and upon full deployment in 2025, Riot now anticipates a total self-mining hash rate capacity of 56 EH/s.

Human Resources Update   

Riot is currently recruiting for positions across the Company. Join our team in building, expanding, and securing the Bitcoin network.   

Open positions are available at: https://www.riotplatforms.com/careers.    

About Riot Platforms, Inc.   

Riot's (NASDAQ: RIOT) vision is to be the world's leading Bitcoin-driven infrastructure platform.  Our mission is to positively impact the sectors, networks, and communities that we touch. We believe that the combination of an innovative spirit and strong community partnership allows the Company to achieve best-in-class execution and create successful outcomes.   

Riot is a Bitcoin mining and digital infrastructure company focused on a vertically integrated strategy. The Company has Bitcoin mining operations in central Texas and Kentucky, and electrical switchgear engineering and fabrication operations in Denver, Colorado.   

For more information, visit www.riotplatforms.com.   

Safe Harbor   

Statements in this press release that are not historical facts are forward-looking statements that reflect management's current expectations, assumptions, and estimates of future performance and economic conditions. Such statements rely on the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Words such as "anticipates," "believes," "plans," "expects," "intends," "will," "potential," "hope," and similar expressions are intended to identify forward-looking statements. These forward-looking statements may include, but are not limited to, statements about the benefits of acquisitions, including financial and operating results, and the Company's plans, objectives, expectations, and intentions. Among the risks and uncertainties that could cause actual results to differ from those expressed in forward-looking statements include, but are not limited to: unaudited estimates of Bitcoin production; our future hash rate growth (EH/s); the anticipated benefits, construction schedule, and costs associated with the Corsicana site expansion; our expected schedule of new miner deliveries; the impact of weather events on our operations and results; our ability to successfully deploy new miners; the variance in our mining pool rewards may negatively impact our results of Bitcoin production; megawatt ("MW") capacity under development; we may not be able to realize the anticipated benefits from immersion cooling; the integration of acquired businesses may not be successful, or such integration may take longer or be more difficult, time-consuming or costly to accomplish than anticipated; failure to otherwise realize anticipated efficiencies and strategic and financial benefits from our acquisitions; and the impact of COVID-19 on us, our customers, or on our suppliers in connection with our estimated timelines. Detailed information regarding the factors identified by the Company's management which they believe may cause actual results to differ materially from those expressed or implied by such forward-looking statements in this press release may be found in the Company's filings with the U.S. Securities and Exchange Commission (the "SEC"), including the risks, uncertainties and other factors discussed under the sections entitled "Risk Factors" and "Cautionary Note Regarding Forward-Looking Statements" of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023, as amended, and the other filings the Company makes with the SEC, copies of which may be obtained from the SEC's website, www.sec.gov. All forward-looking statements included in this press release are made only as of the date of this press release, and the Company disclaims any intention or obligation to update or revise any such forward-looking statements to reflect events or circumstances that subsequently occur, or of which the Company hereafter becomes aware, except as required by law. Persons reading this press release are cautioned not to place undue reliance on such forward-looking statements.   

Investor Contact:   
Phil McPherson   
303-794-2000 ext. 110  
IR@Riot.Inc   

Media Contact:   
Alexis Brock   
303-794-2000 ext. 118   
PR@Riot.Inc   

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SOURCE Riot Platforms, Inc.

FAQ

How many Bitcoin did Riot produce in July 2024?

Riot produced 370 Bitcoin in July 2024, which represents a 45% increase from June 2024.

What was Riot's (RIOT) total deployed hash rate as of July 2024?

Riot's total deployed hash rate reached 23.3 EH/s by the end of July 2024, a 6% increase from June and a 118% increase year-over-year.

How did Riot (RIOT) expand its operations in July 2024?

Riot expanded its operations by acquiring Block Mining, which added 1 EH/s of self-mining capacity and established operations in Kentucky.

What is Riot's (RIOT) projected self-mining hash rate capacity for the end of 2024?

Following the Block Mining acquisition, Riot raised its 2024 deployed hash rate guidance to 36 EH/s by the end of 2024.

How does Riot (RIOT) manage its power consumption during peak demand periods?

Riot participates in ERCOT's Four Coincident Peak Program, curtailing operations during peak demand periods to achieve savings on future costs and support grid stability.