Analysts Watch Chip Sales in Bitcoin Miners’ Q4 Earnings

Bitcoin miners are capitalizing on investor enthusiasm and high valuations in the AI sector by expanding toward AI computing. Riot Platforms, Bitdeer, Marathon Digital, and Core Scientific are set to report results, with analysts optimistic that leasing high-performance hardware and selling ASIC chips could offset declining mining revenues.

Bitdeer has launched a new chip business, while Riot has scaled back Bitcoin mining expansions to explore AI and HPC opportunities. Larger miners are also cutting costs by acquiring power infrastructure, with Bitdeer investing $100m in an Alberta power plant and datacenter. Meanwhile, MARA aims to expand its portfolio of owned and operated sites to drive cost efficiencies.

By leveraging their existing infrastructure and expertise in high-performance computing, these miners can support AI demand while maximizing their asset utilization.

Based on a report from Van Eck publicly traded Bitcoin miners collectively stand to unlock approximately $37.6b in NPV by redirecting 20% of their capacity toward AI and HPC applications.

One key takeaway is the immense potential for miners already engaged in HPC operations or those exploring pilot programs, where some industry leaders are projecting value creation as high as $5.7b to over $10.0b (based on Core’s Q4 report) individually. Another critical insight is the opportunity awaiting miners who have yet to adopt AI/HPC strategies—those sitting on the sidelines could still tap into billions in value, with potential gains ranging from $2.3b to $4.5b for some firms, should they choose to pivot.

The broader implication is clear: integrating AI and HPC not only positions Bitcoin miners to thrive in a tech-driven future but also unlocks significant economic upside, making this a defining moment for the industry as it navigates an evolving landscape.

⛏️ In The News

• BlackRock has added a 1% to 2% allocation of the iShares Bitcoin Trust ETF (IBIT) to its $150b model portfolio, marking its first inclusion of Bitcoin as an alternative investment.

• Bitdeer reported a sharp decline in Q4 2024 revenue to $69m and a net loss of over $530m.

• Nvidia's Q4 revenue surged 78% YoY to $39.3b, driven by strong AI chip demand, beating Wall Street estimates, while its stock remains below its November all-time high after a historic value drop in January.

📆 Miner Reporting

🤖 Core Scientific

• The company reported a Q4 2024 net loss of $265.5m, mainly due to a $224.7m non-cash mark-to-market adjustment. The loss was attributed to an increase in stock price affecting financial obligations but did not represent cash outflows.

• Core Scientific announced a $1.2b data center expansion with CoreWeave. They see over $10.0b in cumulative revenue potential this partnership.

• Their Texas data center expansion is expected to generate $1.2b in contracted revenue.

• CEO Adam Sullivan emphasized the company's commitment to large-scale HPC projects for AI and low-latency workloads.

• The Denton, Texas expansion will house one of North America's largest GPU supercomputers.

• The company’s stock rose by 12.29%, from $10 to $11.25, in after-hours trading following the announcement.

🏃 MARA

• MARA reported record Q4 2024 revenue of $214.4m, surpassing estimates by 16.5%. Net income soared 248% YoY to $528.3m, while adjusted EBITDA grew 207% to $794.4m.

• The company increased its BTC holdings to 44,893 BTC, purchasing 14,574 BTC and mining 2,492 BTC in Q4.

• MARA’s energized hashrate reached 53.2 EH/s, marking a 115% YoY increase.

• The firm secured 300% more energy capacity and expanded to seven Bitcoin mining facilities in 2024.

• It launched 25 MW micro data center projects in Texas and North Dakota to reduce grid reliance.

• MARA is pivoting toward AI inferencing, seeing it as the "second wave" of AI, after a strategic pause during the first wave.

  

🚨 Riot

• Riot Platforms achieved record revenues of $376.7m in 2024, mining revenues rose to $321.0m, nearly doubling from $189.0m in 2023.

• Riot mined 4,828 BTC in 2024, down from 6,626 BTC in 2023, with the average cost to produce one BTC rising to $32,216, up from $3,831 in 2023.

• Riot expanded its operations through key acquisitions, including Block Mining in July 2024 and E4A Solutions to enhance its engineering capabilities.

• By January 2025, Riot had mined 527 BTC in January and increased its BTC holdings to 18,221, valued at $1.6b.

🐺 TeraWulf

• TeraWulf reported a 102% increase in annual revenue to $140.1m in 2024, up from $69.2m in 2023. Non-GAAP adjusted EBITDA grew 89% YoY to $60.4m in 2024, compared to $31.9m in 2023.

• Self-mining capacity expanded by 94% to 9.7 EH/s in 2024, up from 5.0 EH/s in 2023, with mining infrastructure at Lake Mariner reaching 195 MW.

• The company entered AI-driven HPC hosting, signing long-term data center leases with Core42 for 72.5 MW, expected to generate $1.0b in revenue over 10 years, with an option to expand by 135 MW.

• TeraWulf strengthened its balance sheet, holding $274.5m in cash and BTC as of December 31, 2024, and eliminated its legacy term loan debt, previously $139.4m in 2023.

• A $500m convertible notes issuance at 2.75% due 2030 funded HPC growth, while a $85.0m sale of a 25% stake in Nautilus supported reinvestment in Lake Mariner's HPC capabilities.

• The company authorized a $200.0m share repurchase program, executing over $150m in repurchases, equivalent to more than 24m shares, by early 2025.

• TeraWulf plans to deliver 72.5 MW of HPC hosting capacity in 2025, leveraging its zero-carbon energy infrastructure to meet growing AI compute demand.