Marathon Digital misses revenue forecast, shares fall 8%

Marathon Digital ( MARA ) saw its shares fall more than 8% in after-hours trading Thursday after a second-quarter earnings report that fell short of Wall Street forecasts.

However, the stock has recovered some of those losses.

Marathon Digital sees a miss of revenue

Marathon Digital reported second-quarter revenue of $145.1 million, below Wall Street’s forecast of $157.9 million, down about 9%.

The company attributed the revenue loss to operational challenges including unexpected equipment failures, transmission line maintenance at its Ellendale site, an increase in the global hash rate and the impact of the recent reduction in half in the mining sector.

CEO Fred Thiel noted that these issues had negatively affected the company’s BTC production. Despite these setbacks, Marathon achieved record mining power of 31.5 exahash per second (EH/s) during the quarter. The company aims to reach a hashrate of 50 EH/sa by the end of the year and foresees further expansion in 2025.

Meanwhile, the miner’s adjusted EBITDA narrowed to a loss of $85.1 million from a gain of $35.8 million a year earlier, primarily due to unfavorable fair value adjustments to its digital assets and the reduction of BTC production.

In response to its financial pressures, Marathon sold 51% of the BTC it mined to cover operating costs. Since then, the company has bought $100 million worth of bitcoins, opting to keep it all on its balance sheet, which now exceeds 20,000 BTC.

The report also highlighted that the average price of BTC mined in the second quarter of 2024 was 136% higher than the previous year. On average, Marathon mined 22.9 BTC per day, a decrease of 9.3 BTC per day compared to the previous period.

Thiel acknowledged that the company has restructured internally to better align with growth opportunities and improve operational efficiency.

Anti-riot platforms revenue closest to estimate

The report follows Marathon Digital’s recent legal trouble when the company was fined $138 million for breaching a confidentiality agreement.

Meanwhile, rival cryptominer Riot Platforms recently reported revenue of $70 million for the second quarter of 2024, which was down 8.8% year-on-year. The company’s performance was notably closer to Wall Street estimates, with reported revenue just 0.63% below Zacks’ forecast.

Shares of Riot Platforms ( RIOT ) fell 8.54% on the day of the earnings report, closing at $9.32 per share. Meanwhile, MARA shares fell 7.78% to end the trading day at $18.14, according to data from Google Finance.

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