Riot Platforms Reports First Quarter 2023 Financial Results, Current Operational and Financial Highlights
- Riot Platforms, Inc. achieved new all-time highs in Bitcoin production and hash rate capacity during Q1 2023, indicating growth in their mining operations.
- The average cost to mine Bitcoin decreased to $10,354 per Bitcoin for Q1 2023, improving operational efficiency.
- Power curtailment credits earned by Riot Platforms, Inc. increased to $3.1 million for Q1 2023, reducing overall power costs.
- The decrease in total revenue for Q1 2023 was primarily driven by lower Bitcoin prices, which averaged $22,704, a 44% decrease compared to the same period in 2022.
Riot Reports
CASTLE ROCK, Colo., May 10, 2023 (GLOBE NEWSWIRE) -- Riot Platforms, Inc. (NASDAQ: RIOT) (“Riot” or “the Company”), an industry leader in Bitcoin (“BTC”) mining and data center hosting, reported financial results for the three-month period ended March 31, 2023. The unaudited financial statements are available on Riot’s website and here.
“Riot achieved a number of important milestones and records during the first quarter of 2023,” said Jason Les, CEO of Riot. “In spite of damage to our immersion Buildings F and G during severe winter storms in Texas in late 2022, we successfully reached new all-time highs for miner deployment, total hash rate capacity, and monthly Bitcoin production. Our teams are also nearing completion of the final buildout and deployment of miners at our Rockdale Facility and have been working to further enhance operating efficiency.
“Riot’s vertically integrated strategy has once again positioned us during this quarter as an industry leader in low-cost, large-scale Bitcoin mining, and I continue to be excited to work with our team to achieve Riot’s vision of becoming the leading Bitcoin-driven infrastructure platform.”
First Quarter 2023 Financial and Operational Highlights
Key financial and operational highlights for the first quarter include:
- Total revenue of
$73.2 million for the three-month period ended March 31, 2023, as compared to$79.8 million for the same three-month period in 2022. The decrease was primarily driven by lower Bitcoin prices, which averaged$22,704 for the three-month period ended March 31, 2023, a decrease of44% as compared to$41,241 for the three-month period ended March 31, 2022. The decrease in Bitcoin price was offset by a51% increase in Bitcoin mined during the same three-month period in 2022. - Produced 2,115 Bitcoin during the three-month period ended March 31, 2023, as compared to 1,405 Bitcoin during the same three-month period in 2022. Higher Bitcoin production was driven by a significant increase in miners deployed year over year.
- The average cost to mine Bitcoin for the three-month period ended March 31, 2023 was
$10,354 per Bitcoin, as compared to$13,590 per Bitcoin for the same three-month period of 2022. - Earned
$3.1 million in power curtailment credits for the three-month period ended March 31, 2023, as compared to$2.6 million in power curtailment credits earned for the same three-month period in 2022. - Mining revenue of
$48.0 million for the three-month period ended March 31, 2023, as compared to$57.9 million for the same three-month period in 2022, primarily driven by lower Bitcoin prices and increased curtailment driven by our power strategy to reduce overall power costs. - Data center hosting revenue of
$9.0 million for the three-month period ended March 31, 2023, as compared to$9.7 million for the same three-month period in 2022, driven by reduced customer billings as a result of lower revenue share from customers due to lower Bitcoin prices. - Engineering revenue of
$16.1 million for the three-month period ended March 31, 2023, as compared to$12.1 million for the same three-month period in 2022, primarily driven by increased demand from third-party data center and engineering customers. - Maintained industry-leading financial position, with
$253.6 million in working capital, including$158.3 million in cash on hand (and excluding an additional$29.5 million in restricted cash), and$202.0 million Bitcoin (unaudited), all of which were produced by the Company’s self-mining operations, as of March 31, 2023.
First Quarter 2023 Financial Results
Total revenue for the three-months ended March 31, 2023 was
Bitcoin Mining revenue in excess of mining cost of revenues for the three-month period ended March 31, 2023 was
Data Center Hosting cost in excess of revenues for the three-month period ended March 31, 2023 was
Engineering revenue in excess of engineering cost of revenue for the year three-month period ended March 31, 2023 was
Power curtailment credits received, based on ancillary services fees earned from our participation in ERCOT’s demand response programs and our ability under long-term power agreements to sell power back to the ERCOT grid at market-driven spot prices and thereby reduce our operating costs, totaled approximately
If power credits were directly allocated between Bitcoin Mining cost of revenues and Data Center Hosting cost of revenues based on proportional power consumption, Bitcoin Mining cost of revenues would have decreased by
Selling, general and administrative expenses during the three-month period ended March 31, 2023 totaled
Net loss for the three-month period ended March 31, 2023 was
Non-GAAP Adjusted EBITDA for the three-month period ended March 31, 2023 was
First Quarter 2023 and Recent Operational Highlights
- As of April 30, 2023, the Company had a deployed fleet of 94,176 miners and achieved an all-time record hash rate capacity of 10.5 EH/s (which excludes 17,040 miners currently offline in Building G).
- Ended the month of April with 800 miners staged for deployment. Upon deployment of the staged miners, the Company expects to have a total of 94,976 miners deployed with a hash rate capacity of approximately 10.6 EH/s.
- Continued the ongoing 400 megawatt (“MW”) expansion at our Rockdale Facility, which is expected to be fully completed in Q2 2023. In Building D, the installation of water-cooling pads has been completed, while in Building E, the evaporative water wall system framing has been installed.
Hash Rate Growth
As previously disclosed, severe winter storms in Texas in late December caused damage to Buildings F and G at our Rockdale Facility, which has led to a delay in our previously stated goal of achieving 12.5 EH/s in total self-mining hash rate capacity in Q1 2023.
Building F has since been brought back online and based on the ongoing repair to Building G, we now anticipate achieving our 12.5 EH/s hash rate capacity target in the second half of 2023.
ATM Offering
In March 2022, the Company entered into an ATM sales agreement under which it could offer and sell up to
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 data center operations in central Texas, Bitcoin mining operations in central Texas, 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 Navarro site expansion; our expected schedule of new miner deliveries; our ability to successfully deploy new miners; M.W. 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, 2022, 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.
For further information, please contact:
Investor Contact:
Phil McPherson
IR@Riot.Inc
303-794-2000 ext. 110
Media Contact:
Alexis Brock
303-794-2000 ext. 118
PR@Riot.Inc
Non-U.S. GAAP Measures of Financial Performance
In addition to financial measures presented under generally accepted accounting principles in the United States of America (“GAAP”), we consistently evaluate our use of and calculation of the non-GAAP financial measures, “Adjusted EBITDA” and Adjusted earnings per share (“Adjusted EPS”). EBITDA is computed as net income before interest, taxes, depreciation, and amortization. Adjusted EBITDA is a financial measure defined as EBITDA, adjusted to eliminate the effects of certain non-cash and/or non-recurring items that do not reflect our ongoing strategic business operations, which management believes results in a performance measurement that represents a key indicator of the Company’s core business operations of Bitcoin mining. The adjustments include fair value adjustments such as derivative power contract adjustments, equity securities value changes, and non-cash stock-based compensation expense, in addition to financing and legacy business income and expense items. We exclude impairments and gains or losses on sales or exchanges of Bitcoin from our calculation of Adjusted EBITDA for all periods presented.
Adjusted EPS is a financial measure defined as Adjusted EBITDA divided by our diluted weighted-average shares outstanding.
We believe Adjusted EBITDA and Adjusted EPS can be important financial measures because they allow management, investors, and our board of directors to evaluate and compare our operating results, including our return on capital and operating efficiencies, from period-to-period by making such adjustments.
Adjusted EBITDA and Adjusted EPS are provided in addition to, and should not be considered to be a substitute for, or superior to, net income, the most comparable measure under GAAP for Adjusted EBITDA, and to diluted net income (loss) per share, the most comparable measure under GAAP for Adjusted EPS. Further, Adjusted EBITDA and Adjusted EPS should not be considered as an alternative to revenue growth, net income, diluted earnings per share or any other performance measure derived in accordance with GAAP, or as an alternative to cash flow from operating activities as a measure of our liquidity. Adjusted EBITDA and Adjusted EPS have limitations as analytical tools, and you should not consider such measures either in isolation or as substitutes for analyzing our results as reported under GAAP.
The following table reconciles Adjusted EBITDA to Net income (loss), the most comparable GAAP financial metric:
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2023 | 2022 | |||||||
| Net income (loss) | $ | (55,688 | ) | $ | 36,578 | |||
| Interest (income) expense | 3,830 | 357 | ||||||
| Income tax expense (benefit) | (4,969 | ) | 312 | |||||
| Depreciation and amortization | 59,340 | 14,245 | ||||||
| EBITDA | 2,513 | 51,492 | ||||||
| Adjustments: | ||||||||
| Non-cash/non-recurring operating expenses: | ||||||||
| Stock-based compensation expense | (2,296 | ) | 3,042 | |||||
| Acquisition-related costs | — | 78 | ||||||
| Change in fair value of derivative asset | 5,778 | (43,683 | ) | |||||
| Change in fair value of contingent consideration | — | 176 | ||||||
| Unrealized (gain) loss on marketable equity securities | — | 1,611 | ||||||
| Casualty-related charges (recoveries), net | 1,526 | — | ||||||
| Other revenue, (income) expense items: | ||||||||
| License fees | (24 | ) | (24 | ) | ||||
| Adjusted EBITDA | $ | 7,497 | $ | 12,692 | ||||
The following table reconciles Adjusted EPS to Diluted net income (loss) per share, the most comparable GAAP financial metric:
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2023 | 2022 | |||||||
| Diluted net income (loss) per share | $ | (0.33 | ) | $ | 0.31 | |||
| Interest (income) expense | 0.02 | — | ||||||
| Income tax expense (benefit) | (0.03 | ) | — | |||||
| Depreciation and amortization | 0.35 | 0.12 | ||||||
| EBITDA | 0.01 | 0.43 | ||||||
| Adjustments, per share: | ||||||||
| Non-cash/non-recurring operating expense: | ||||||||
| Stock-based compensation expense | (0.01 | ) | 0.03 | |||||
| Acquisition-related costs | — | — | ||||||
| Change in fair value of derivative asset | 0.03 | (0.37 | ) | |||||
| Change in fair value of contingent consideration | — | — | ||||||
| Unrealized (gain) loss on marketable equity securities | — | 0.01 | ||||||
| Casualty-related charges (recoveries), net | 0.01 | — | ||||||
| Other revenue, (income) expense items: | ||||||||
| License fees | — | — | ||||||
| Adjusted EPS | $ | 0.04 | $ | 0.10 | ||||
| Diluted weighted average number of shares outstanding | 167,342,500 | 117,042,347 | ||||||
In addition to the non-GAAP financial measures of Adjusted EBITDA and Adjusted EPS described above, we believe “Bitcoin Mining revenue in excess of cost of revenues, net of power curtailment credits”, “Data Center Hosting revenue in excess of cost of revenues, net of power curtailment credits”, “Cost of revenues – Bitcoin Mining, net of power curtailment credits” and “Cost of revenues – Data Center Hosting, net of power curtailment credits” are additional performance measurements that represent a key indicator of the Company’s core business operations of both Bitcoin mining and Data Center Hosting.
We believe our ability to offer power back to the grid at market-driven spot prices, thereby reducing our operating costs, is integral to our overall strategy, specifically our power management strategy and our commitment to supporting the ERCOT grid. While participation in various grid demand response programs may impact our Bitcoin production, we view this as an important part of our partnership-driven approach with ERCOT and our commitment to being a good corporate citizen in our communities.
We also believe netting the power sales against our costs can be an important financial measure because it allows management, investors, and our board of directors to evaluate and compare our operating results, including our operating efficiencies, from period-to-period by making such adjustments. We have allocated the benefit of the power sales to our Data Center Hosting and Bitcoin Mining segments based on their proportional power consumption during the periods presented.
Bitcoin Mining revenue in excess of cost of revenues, net of power curtailment credits, Data Center Hosting revenue in excess of cost of revenues, net of power curtailment credits, Cost of revenues – Bitcoin Mining, net of power curtailment credits and Cost of revenues – Data Center Hosting, net of power curtailment credits are provided in addition to and should not be considered to be a substitute for, or superior to Revenue – Bitcoin Mining, Revenue – Data Center Hosting, Cost of revenues – Bitcoin Mining or Cost of revenues – Data Center Hosting as presented in our consolidated statements of operations.
The following table presents reconciliations of these measurements to the most comparable U.S. GAAP financial metrics:
| Three Months Ended | |||||||||
| March 31, | |||||||||
| 2023 | 2022 | ||||||||
| Bitcoin Mining | |||||||||
| Revenue | $ | 48,023 | $ | 57,945 | |||||
| Cost of revenues | 21,899 | 19,094 | |||||||
| Power curtailment credits | (1,937 | ) | (611 | ) | |||||
| Cost of revenues, net of power curtailment credits | 19,962 | 18,483 | |||||||
| Bitcoin mining revenue in excess of cost of revenues, net of power curtailment credits | $ | 28,061 | $ | 39,462 | |||||
| Bitcoin mining revenue in excess of cost of revenues, net of power curtailment credits as a percentage of revenue | 58.4 | % | 68.1 | % | |||||
| Data Center Hosting | |||||||||
| Revenue | $ | 9,042 | $ | 9,694 | |||||
| Cost of revenues | $ | 25,660 | $ | 14,985 | |||||
| Power curtailment credits | (1,138 | ) | (1,941 | ) | |||||
| Cost of revenues, net of power curtailment credits | 24,522 | 13,044 | |||||||
| Data Center Hosting revenue in excess of cost of revenues, net of power curtailment credits | $ | (15,480 | ) | $ | (3,350 | ) | |||
| Data Center Hosting revenue in excess of cost of revenues, net of power curtailment credits as a percentage of revenue | (171.2 | )% | (34.6 | )% | |||||
| Total power curtailment credits | $ | (3,075 | ) | $ | (2,552 | ) | |||
FAQ
What were the financial highlights for Riot Platforms, Inc. in Q1 2023?
What was the average cost to mine Bitcoin for Q1 2023?
Did Riot Platforms, Inc. experience any positive developments in Q1 2023?
What caused the decrease in total revenue for Q1 2023?
Did Riot Platforms, Inc. reduce their power costs in Q1 2023?
