Bitfarms Ltd. (NASDAQ: BITF) on Monday reported second-quarter earnings that exceeded some analysts’ expectations as the block reward miner cashed in on the booming digital currency market.
Against this backdrop, Bitfarms’ revenue soared by 398% to $36.7 million, up to $29.3 million the year-ago quarter. Gross mining profit came to $28.1 million, thanks in part due to the rise in token price.
Bitfarms also attributed its improved financial performance to an increase in the average hash rate by approximately 618 PH/s or 89%. In the second quarter, Bitfarms mined 759 BTC tokens with an average cost of roughly $9,000 per token. CEO Emiliano Grodzki said in a news release that the company expects to have increased its capacity eightfold and expanded its geographic resources throughout North and South America.
Bitfarms reported an adjusted EBITDA of $23.8 million, with a 65% adjusted EBITDA margin. The company recorded an operating loss of $2.1 million and a net loss of $3.7 million for the quarter. The company held 1,293 BTC tokens as of June 30th.
The company’s earnings release offered a key endorsement to the positive impact that the crackdown of blockchain miners in China is having on the sector. Grodzki mentioned how “the current market is favorable” to Bitfarms because the Chinese ban on digital currency mining and subsequent shutdown of almost one-half of the BTC network hash rate allowed Bitfarms to increase its market share to just above 1.5% from less than 1.0% at the beginning of the year.
Grodzki further added that the Chinese ban enabled Bitfarms to benefit by procuring “miners more competitively than we have in the past and to leverage our infrastructure development and operating capabilities to further support our ambitious plans for expansion.”
Bitfarms ended the quarter with cash of approximately $36.2 million and total liquidity, defined as cash and BTC holdings, of roughly $81.6 million. Shares of Bitfarms rose after the earnings were released.
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