Bit Deer Q1 2025 Financial Report Analysis and Future Outlook

A cryptocurrency mining company recently announced its financial report for the first quarter of fiscal year 2025. The report shows that the company's revenue for the first quarter reached $70.1 million, a year-on-year decrease of 41.3%, but a slight increase of 1.6% compared to the previous quarter. The revenue from self-operated businesses was $37.2 million, a year-on-year decrease of 10.4%. The overall gross profit was a negative $3.2 million, with a gross margin of -4.6%. The main reason for this was the increase in electricity prices due to the dry season in Bhutan, which led the company to temporarily close its local mining facilities. It is worth noting that with the arrival of the wet season, electricity prices in the second quarter have fallen back to $0.042 per kilowatt-hour.

The company began selling Seal mining machines this quarter, generating $4.1 million in revenue. Adjusted EBITDA was negative $56.1 million, compared to positive $27.3 million in the same period last year. Net profit reached $410 million, mainly due to the reversal of the fair value of previously accrued convertible notes and certain cryptocurrency options.

The company's prepaid accounts continue to increase, reaching $382 million, which has fully covered the funding required for the maximum wafer volume. The Seal02 mining machines have begun shipping, and future self-operated and sales strategies will be adjusted based on market competition. The Seal03 mining machines have also completed the wafer process and are expected to be put into use and sold by the end of the third quarter or in the fourth quarter of 2025.

To respond to the U.S. tariff policy, the company will complete the construction of its North American assembly plant in the second quarter. Although this will increase costs by about 10%, it is much less than the current tariff impact from Southeast Asia. The Southeast Asian assembly plant will continue to meet demand in non-U.S. regions.

The company's global power infrastructure construction is progressing rapidly, with an expected global available power capacity nearing 1.6GW by the end of the second quarter, and is expected to reach 1.8GW by the end of the year. As of April, the hash rate of the company's self-operated mines has reached 12.5Eh/s, and it is expected to rise to 40Eh/s in October, surpassing this level by the end of the year.

Although the latest Seal01 and Seal02 mining machines were only put into use in March, the company's mining costs are still more than 20% lower than its main competitors. With the complete replacement of old mining machines, the cost advantage will become more pronounced, and it is expected that the monthly output will show exponential growth starting from the second quarter.

Recently, the price of Bitcoin has shown an upward trend and is expected to break the previous historical high of $109,000 per coin. Against the backdrop of pressure on the US dollar's performance, Bitcoin is increasingly highlighting its safe-haven properties as an alternative asset. The Federal Reserve's recent adoption of an "average inflation" policy may lead to an earlier interest rate cut in June, with the expectation of three rate cuts throughout the year, all of which will support the price of Bitcoin.

After experiencing an operational adjustment period in the fourth quarter of last year and the first quarter of this year, the company is about to enter a critical period. In the coming quarters, the speed of mining machine research and development and the expansion rate of self-operated mining sites will become important observation indicators. The first quarter of 2025 may be the worst-performing period for the company in the next two years, but it also marks the arrival of an operational turning point.