In the second quarter of this year, Riot Platforms reported a net loss of $84.4 million, a significant increase from the $27.4 million loss in the same period last year. The widened losses can be attributed to the continued impact of the April Bitcoin halving event. Despite this, Riot still managed to generate a total revenue of $70 million in Q2 2024, although this was down from $76.7 million in the previous year’s second quarter. The decrease in revenue was primarily driven by a drop in Engineering revenues, partially offset by a rise in Bitcoin mining revenue.
During the same period, Riot Platforms produced 844 Bitcoin, which was a 52% decrease from the previous year’s production. This decline can be linked to the effects of the April 2024 block subsidy halving and the increased network difficulty. The average direct cost to mine Bitcoin also skyrocketed to $25,327 per BTC, a significant jump from $5,734 in Q2 2023. This increase was influenced by the halving event and a substantial rise in the global network hash rate.
Despite facing these challenges, Riot was able to grow its mining revenue to $55.8 million in Q2 2024, compared to $49.7 million in the prior year. The company emphasized that it maintained a strong financial position with $646.5 million in working capital, including $481.2 million in cash. Additionally, Riot held 9,334 unencumbered Bitcoin, valued at around $585 million, all mined through its operations. CEO Jason Les highlighted the impact of the Bitcoin halving on the company’s performance, noting the reduction in available production for all Bitcoin miners.
In a strategic move to strengthen its position in the industry, Riot acquired the Kentucky-based firm Block Mining in a $92.5 million deal. This acquisition included $18.5 million in cash from Riot’s reserves and $74 million in Riot common stock. Following this acquisition, Riot experienced an immediate increase in hash rate, expanded its geographical footprint, and entered additional energy markets beyond the Electric Reliability Council of Texas (ERCOT) region.
Overall, Riot Platforms faced significant challenges in the second quarter of 2024 due to the impact of the Bitcoin halving event. Despite the financial losses and decrease in revenue, the company remains focused on expanding its operations and strengthening its position in the Bitcoin mining industry.