Bit Deer Q1 2025 Performance Review and Outlook

A cryptocurrency mining company recently announced its financial report for the first quarter of fiscal year 2025. The data shows that the company's revenue in the first quarter reached $70.1 million, a year-on-year decrease of 41.3%, but a slight quarter-on-quarter increase of 1.6%. Among this, self-operated business contributed $37.2 million in revenue, a year-on-year decrease of 10.4%. Notably, the company's consolidated gross profit was negative $3.2 million, with a gross margin of -4.6%, primarily due to rising electricity prices caused by the dry season in Bhutan, which led the company to temporarily shut down its local mining sites. However, as the second quarter enters the wet season, electricity prices have reverted to the level of $0.042 per kilowatt-hour.

The company achieved its first sale of Seal mining machines this quarter, with revenue reaching $4.1 million, marking the official launch of its mining machine sales business. Nevertheless, the company's adjusted EBITDA remains at a negative $56.1 million, a significant decline compared to the positive $27.3 million in the same period of 2024. However, net profit reached $410 million, primarily due to the fair value reversal of the convertible notes ($448.7 million) and Tether options ($58.4 million) recognized in the fourth quarter of 2024.

Looking ahead, the company has made positive progress in multiple areas:

1. Prepayments increased to $382 million, providing sufficient financial support for the largest tape-out volume. The Seal02 miner has begun shipping, and the Seal03 miner has completed tape-out and entered the testing phase, expected to be put into use and sold by the end of the third quarter or the fourth quarter of 2025.

2. In response to the U.S. tariff policy, the company will complete the construction of its North American assembly plant in the second quarter. Although costs have slightly increased, the impact of tariffs from Southeast Asia is comparatively smaller. Meanwhile, the Southeast Asian assembly plant will serve the market demand in non-U.S. regions.

3. The construction of global power infrastructure continues to advance, and it is expected that the available power capacity will approach 1.6GW by the end of the second quarter, potentially reaching 1.8GW by the end of the year.

4. As of April, the company's self-operated mining farm has reached a computing power of 12.5Eh/s, and it is expected to increase to 40Eh/s in October, with a potential to exceed 40Eh/s by the end of the year. The new Seal01 and Seal02 mining machines were only put into operation in March, but the company's mining costs are already at least 20% lower than those of major competitors. With the complete replacement of old equipment, the cost advantage will be further highlighted, and the monthly output is expected to show exponential growth starting from the second quarter.

Against the backdrop of the current recovery in Bitcoin prices and the prospect of breaking historical highs, the cryptocurrency industry is facing new development opportunities. The USD is under pressure, and Bitcoin's attributes as a safe-haven asset are becoming increasingly prominent. The shift in Federal Reserve policy has also provided support for Bitcoin prices. For the company, although the first quarter of 2025 may be the worst operating period in the past two years, it also marks the arrival of an inflection point in operations. In the coming quarters, the progress of mining machine research and development and the speed of self-operated mining farm expansion will become key observation points, and the company is expected to maintain a leading position among Bitcoin mining stocks in North America.