Marathon Digital, a US-based Bitcoin mining company, reported second-quarter 2024 earnings below Wall Street expectations, leading to a decline in the company’s stock price.
Between April and June 2024, Marathon Digital recorded total revenue of $145.1 million, roughly IDR 2.3 trillion. According to Yahoo Finance, this is 9% lower than Wall Street analysts’ prediction of $157.9 million, or about IDR 2.5 trillion.
Marathon disclosed that various operational challenges impacted their sales and impeded their ability to mine Bitcoin. The impact of the Bitcoin Halving in April 2024 also weighed on their mining sector.
“Unexpected equipment failures, maintenance of transmission lines at the Ellendale site managed by Applied Digital, a rise in the global hash rate, and the April Halving impacted our BTC production during Q2 2024,” said Marathon Digital CEO Fred Thiel. As a result of this report, MARA’s stock price dropped by 7.78% to $18.14 in Thursday’s (1/8/2024) trading, according to Google Finance data. Over the past week, MARA’s price has fallen by up to 16%.
Selling Bitcoin to Cover High Operational Costs
Marathon’s earnings report highlighted that the second quarter’s average Bitcoin mining price was about 136% higher compared to the same period in 2023.
To cover operational costs, Marathon Digital sold 51% of the Bitcoin they mined during this quarter.
Additionally, adjusted EBITDA for the second quarter turned into a loss of $85.1 million, equivalent to IDR 1.3 trillion, from a profit of $35.8 million, around IDR 580 billion, in 2023. This was primarily due to unfavorable fair value adjustments of their digital assets and a decrease in the number of Bitcoins mined. Despite these challenges, the company reported achieving a record hash rate of 31.5 exahashes per second (EH/s) during this period. They remain optimistic about reaching a hash rate of 50 EH/s by the end of 2024.
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