Hut 8 Mining, a Bitcoin miner based in Toronto, experienced a significant decline in first-quarter revenue, falling by a larger-than-anticipated 64% to C$19 million ($14.16 million) compared to the previous year. This decline was primarily due to the company being compelled to shut down certain machines as a result of a dispute with its energy provider.
Moreover, the revenue for the first quarter dropped by 13% compared to the previous quarter, failing to meet analyst expectations of C$21.2 million. Hut 8 reported earnings per share (EPS) of C$0.47, surpassing forecasts for a loss of C$0.15 on FactSet.
While the crypto mining industry is gradually recovering from a challenging period known as the “crypto winter,” during which prominent entities such as Compute North and Core Scientific sought chapter 11 bankruptcy protection, Hut 8 faced the necessity of turning off approximately 8,000 machines at its Ontario facility due to an energy provider dispute in mid-November. Since then, the company has managed to bring only around 1,000 machines back online.
In addition to these challenges, Hut 8’s facility in Drumheller, Alberta is currently operating at a mere 15% capacity due to electrical issues that have caused equipment damage. This facility accounts for an estimated 0.9 EH/s of Hut 8’s total computing power of 2.6 EH/s.
As of the time of writing, Hut 8’s stock on the Nasdaq experienced a minimal change in pre-market trading, declining by 0.55% to $1.82. Despite this recent drop, the shares have more than doubled in value throughout 2023, although they still remain 34% lower compared to the same period last year.
Furthermore, Hut 8 is currently undergoing a merger process with U.S. Bitcoin Corp. (USBTC), a private miner that operates in New York and Texas.