Bitfarms Stock Surges 22% Following Positive Q2 Results

On August 8, Bitfarms experienced a strong trading session as its stock rose nearly 22% following the release of its latest quarterly earnings report, which showcased losses that were lower than anticipated.

Highlights from Q2 Earnings Report

Bitfarms, a Canadian Bitcoin mining company, reported a loss of 7 cents per share, which was better than the expected loss of 11 cents per share as per forecasts by Zacks Investment Research.

In a post shared on August 8, the newly appointed CEO Ben Gagnon emphasized that Bitfarms is exploring diverse opportunities beyond traditional Bitcoin mining. He stated:

“We continue to dramatically alter our operating profile via our ongoing fleet upgrades and our geographic expansion.”

Bitfarms experienced a 16% decrease in total revenue to $42 million from the previous quarter, falling short of analysts’ expectations. The reduction in revenue was attributed to smaller block rewards following the Bitcoin halving on April 19.

Understanding Bitcoin Halving

The halving is a systematic event within the Bitcoin protocol that occurs after every 210,000 blocks are mined, reducing miners’ rewards by half. Miners now receive 3.125 BTC for each mined block, down from 6.25 BTC.

Additionally, Bitfarms reported operational losses amounting to $23.6 million, which included a significant $46 million in accelerated depreciation on older mining equipment.

Production Metrics and Future Plans

During the second quarter, Bitfarms mined a total of 614 BTC, valued at approximately $37 million based on current market rates, according to CoinGecko.

• The total cash production cost of a single Bitcoin rose to $47,300, compared to $27,900 in the first quarter of 2024.
• In April, the company announced plans to invest around $240 million to enhance its mining infrastructure and add 88,000 new miners.
• A 34% increase in Bitcoin production was noted in July, generating 243 BTC ($14 million) compared to 189 BTC ($11 million) in June.

Bitfarms also reported a significant increase in its hashrate, which rose to 11.1 EH/s, significantly higher than the previous figure of 6.5 EH/s. Gagnon noted that the new facility in Sharon, PA, is expected to further boost production rates by 2025. He concluded:

“Over the next few years, we will continue executing our growth strategy with a sharp focus on U.S. expansion and diversification beyond Bitcoin mining.”