Bitfarms Faces $27 Million Loss in Q2 Due to Rising Bitcoin Production Costs

Bitfarms Ltd., a global Bitcoin mining company, reported a net loss of $27 million for Q2 2024. This contrasts with a net loss of $6 million in Q1 2024. The company faced significant challenges following the Bitcoin halving event in April 2024, which reduced block rewards and impacted revenue, according to Bitfarms.

Revenue for Q2 was $42 million, down 16% from Q1 but up 17% year-over-year. The gross mining margin dropped to 51% from 64% in Q1. Bitfarms increased its hashrate to 11.1 EH/s, up from 6.5 EH/s in Q1. The company expanded its capacity by 220 MW, adding new sites in Paraguay and Pennsylvania.

Bitfarms’ production costs surged, with the average direct cost per Bitcoin rising to $30,600 from $18,400 in Q1. The total cash cost per Bitcoin also increased significantly, reaching $47,300, up from $27,900 in Q1. Despite these higher costs, the company mined 614 BTC during the quarter.

CEO Ben Gagnon highlighted the strategic expansion into the U.S. and South America. The new site in Sharon, PA, provides access to low-cost energy and flexible power trading options. Additionally, the company energized its largest site in Paso Pe, Paraguay, and signed an agreement for an additional 100 MW in Yguazu, aiming for a total contracted power of 280 MW in 2025.

Bitfarms is also diversifying its business beyond Bitcoin mining, focusing on high-performance computing (HPC) and AI hosting. The company’s CFO, Jeff Lucas, emphasized the robust balance sheet and capital-efficient growth strategy. Bitfarms raised $136 million in net proceeds during Q2 and $240 million through August 7, 2024, supporting its ambitious expansion plans.