Marathon Digital Stock Falls After Q2 Revenue Miss
YEREVAN (CoinChapter.com) — Marathon Digital, known by the ticker MARA, saw its stock price drop after announcing its Q2 2024 earnings. The company reported a net loss of $199.7 million, a sharp rise from a $9 million loss in the same quarter last year.
Marathon Digital Holdings Q2 Report. Source: U.S. Securities and Exchange Commission (SEC) Form 10-Q
This increase in losses was mainly due to unexpected equipment failures and maintenance issues at the Ellendale site, which reduced Bitcoin production.
The April Bitcoin halving event also affected the company’s operations by increasing competition. Fred Thiel, CEO of Marathon Digital, noted,
“Our BTC production was impacted by unexpected equipment failures and transmission line maintenance at the Ellendale site.”
Marathon Digital Q2 2024 Financial Highlights. Source: Mara.com
Despite these issues, the company reached an installed hash rate of 31.5 exahash per second (EH/s).
Marathon Digital Misses Q2 Revenue Estimates, Stock Drops Amid Rising Costs
Marathon Digital’s revenue for Q2 2024 was $145.1 million, a 78% increase from $81.7 million in Q2 2023. However, this was below analysts’ expectations of $157.9 million. This shortfall marked the second consecutive quarter the company missed revenue estimates. Following the earnings release, MARA’s stock fell 7.78%, closing at $18.14.
MARA’s price is down 19.59% over the past 30 days. Source: Google Finance
The company sold 51% of its Bitcoin holdings to cover operating expenses. The cost of Bitcoin mined by Marathon rose 136% compared to the same period last year. The average daily production was 22.9 BTC, down by 9.3 BTC from the previous period.
Bitcoin Miners Face Revenue Declines Amid Rising Costs and Hash Rates
Marathon Digital’s stock has declined 19.59% over the past 30 days. The rise in operational costs and the increased global hash rate have put pressure on the company’s profitability.
Riot Platforms, another Bitcoin miner, reported Q2 earnings with $70 million in revenue, an 8.8% decline year-over-year. Riot’s revenue was close to analysts’ expectations, missing by only 0.63%. Riot’s stock ended the day down 8.54%, closing at $9.32.
Riot Platforms Q2 2024 Financial Report. Source: Riot Platforms, Inc.
Marathon recently adopted a “HODL” strategy, purchasing an additional $100 million in Bitcoin. The company plans to reach an installed hash rate of 50 EH/s by the end of the year.
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