CASTLE ROCK, Colo. - Riot Platforms, Inc. (NASDAQ: NASDAQ:RIOT), a prominent player in the Bitcoin mining sector, reported its unaudited production and operational updates for August 2024, noting a significant milestone of exceeding 10,000 Bitcoin held by the company. In August, Riot produced 322 Bitcoin, a slight decrease from the 370 mined in July and 333 from the previous year.
The company's total deployed hash rate across all facilities reached 23.5 EH/s, marking a 1% increase from July and a substantial 128% rise from the previous year. Riot's Rockdale facility maintained a deployed hash rate of 14.7 EH/s, while its Corsicana facility held steady at 7.6 EH/s. The newly acquired Kentucky facilities experienced a 20% increase in deployed hash rate, reaching 1.2 EH/s.
Riot's average operating hash rate for August was 14.5 EH/s, down 7% from July but up a notable 224% year-over-year. The company's power strategy, which involves operating as a flexible power consumer, allowed it to optimize energy costs and contribute to grid stability during peak demand periods. This strategy led to a reduction in the all-in power cost at the Rockdale and Corsicana facilities to $20/MWh and $39/MWh, respectively.
The company did not sell any Bitcoin in August, contrasting with the 300 Bitcoin sold in August 2023 for net proceeds of $8.6 million. Riot's total power credits for the month amounted to $6.4 million, a significant decrease from the $28.5 million recorded in the same month last year.
Riot's CEO, Jason Les, highlighted the company's unique power strategy, which contributed to lower energy costs and provided additional power to the grid during Texas's peak demand in August. Les also mentioned the impact of high temperatures and unscheduled maintenance on operations, but assured that the affected Rockdale facility has since returned to full operation.
The company is progressing with the development of its Corsicana facility, with the third 100 MW building, Building B1, set to be fully operational by the end of September. Riot is also increasing hash rate at its Kentucky facilities and remains on track to achieve its third-quarter hash rate target of 28 EH/s and a year-end goal of 36 EH/s.
This update is based on a press release statement from Riot Platforms, Inc.
In other recent news, Riot Platforms, a key player in the Bitcoin mining industry, has been making strategic moves. The company has increased its ownership in Bitfarms to 18.9% by acquiring an additional 1 million common shares. This move comes amid ongoing tensions between the two companies, with Riot expressing readiness to engage with a reconstituted Bitfarms board on a potential transaction.
In addition, Riot Platforms has announced the removal of its data center hosting segment from reportable business segments, following the termination of all contracts with the company's data center hosting and colocation customers. This decision is part of Riot Platforms' ongoing efforts to streamline operations and focus on its core business areas.
On the production front, Riot Platforms reported a 45% increase in Bitcoin production in July 2024 compared to the previous month. The company also expanded its operations by acquiring Block Mining in Kentucky, adding 1 EH/s to its self-mining capacity.
Financially, Riot Platforms reported revenues of $70 million, surpassing projections. However, adjusted EBITDA was significantly lower than the anticipated $16 million. Following these developments, Needham maintained a Buy rating on Riot Platforms, increasing the price target to $14 from $13. Stifel Canada initiated coverage on Riot Platforms with a Speculative Buy rating and a price target set at $18.00, while Roth/MKM also maintained its Buy rating on Riot Platforms stock, with a $20.00 price target.
InvestingPro Insights
Riot Platforms, Inc. (NASDAQ: RIOT), while navigating the challenging terrain of Bitcoin mining, has recently achieved a noteworthy feat by amassing over 10,000 Bitcoin. This milestone comes at a time when the company's financial health and stock performance are of particular interest to investors. According to the latest data from InvestingPro, Riot holds a market capitalization of approximately $2.08 billion, reflecting its standing in the industry. Despite fluctuations in Bitcoin production and the operational hurdles mentioned by CEO Jason Les, Riot's commitment to increasing its hash rate indicates a forward momentum in its growth strategy.
InvestingPro Tips suggest that Riot is trading at a low P/E ratio of 17.23 relative to near-term earnings growth, indicating that the stock may be undervalued given its growth prospects. This aligns with the company's operational updates, as it continues to expand its facilities and hash rate capacity. Furthermore, analysts anticipate sales growth in the current year, which could be a positive signal for potential investors considering Riot's future revenue prospects.
However, it's important to note that the company has been quickly burning through cash, which is a critical factor to monitor, especially in the capital-intensive industry of Bitcoin mining. Additionally, the stock has experienced significant volatility, with a price total return of -37.61% over the last year, emphasizing the need for cautious investment decisions.
For those interested in a deeper analysis of Riot Platforms, Inc., InvestingPro offers additional insights and metrics. Currently, there are 19 more InvestingPro Tips available for RIOT, which can be accessed through the dedicated InvestingPro page for the company. These tips provide a comprehensive view of Riot's financial health, stock performance, and industry position, which can be invaluable for making informed investment choices.
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