Riot Blockchain (RIOT) 31 Jul 242024 Q2 Earnings call transcript

Greetings, and welcome to Riot Platform's Second Quarter 2024 Financial Results Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Phil McPherson, Vice President of Capital Markets and Investor Relations. Thank you.

You may begin.

Thank you, [ Zico ]. to Second welcome Conference XXXX and Call. afternoon, Riot Quarter Platform's Earnings Good Phil me CFO; and from name Head McPherson, My is and Development joining Executive President Jason Strategy. CEO, of Corporate Chung, Riot Les, on Colin Jason Yee, and Vice and are call today's

performance. of provided additional certain second prepared substitute should GAAP a earnings not Riot for aid are company's or presentation, be Investor as performance our intended you quarter further considered items. items clarifying as remarks press superior include a earnings to non-GAAP prepared to can website, the in the XXXX financial included measures of release the investors today's and financial with which discussion accordance in which On find to supplement and are Relations quarter Non-GAAP understanding measures and accompanying second

for to XX, call today XX-K of Exchange the Platforms. that, quarter section CEO Risk with Securities as making call, and filings XX-Q, earnings differ expectations These the factors on turn this the XXXX, today's press are we based during will today's discussed I Les, responses comments today's now due over June and well are release During Commission. With to Factors made and statements and be events. and call future call of Form ended which could and in including regarding after materially statements Actual will results assumptions our in subject current potential management's will to filed forward-looking Form in the Jason be and Riot as uncertainties. other risks

two, focus built developing a sheet a vertically good low-cost balance of three pillars on and three, integrated operations scale; afternoon, Bitcoin Bitcoin; producer being one, strategic has on been developing company a Phil, leading owning significant of: strength. you, building the of key of mining and everyone. Riot's Thank primary

energized Riot our of and XX of deployed total EH/s Corsicana all XX% XXXX, hash demonstrated exceeding During success by facility, rate to successfully target of pillars. quarter the second EH/s these at quarter-over-quarter increasing our three we've quarter XX from XXEH/s. end

We from These XX EH/s also target as to and target raised to XX XX rate our strong rate our plans EH/s a deployed EH/s a sheet. hash XXXX remain hash fully balance continued EH/s. deployed our on XX of growth result focus funded maintaining from XXXX

occurred to X.XXX subsidy which of the and of quarter quarter following Bitcoin Bitcoin second to occurred The predominantly in first which production, block. from XXXX a X.XX in per block Bitcoin April, led was the halving the which reduction late event,

during per quarter. These all-in outstanding X% the for also during Additionally, rate $XX.X generated these of of quarter extremely [ supply demand. of global cost the by power ] it to and hash grew events created the cost quarter-over-quarter. bitcoin comes strategy, the well $X.XXX million of and was price an average when competitive results miners the below in cost grid these events, during credits the to disruption were aided per Riot's by headwinds supporting Power times remained quarter, which direct resulting our the Despite Both kilowatt mine during while unique Texas quarter in hour in power mining. of second Bitcoin bearish in

build and operating quarter adds on megawatts capacity deployed. Mining, in in and clearly expand us to a by XX mining XXX to remain a total second the Kentucky. We to potentially on pipeline Following This existing the Colin power operating leveraging maximizing total megawatts rate us EH/s to Yee, over Bitcoin year Riot Riot immediately held XX acquisition Kentucky. Block an gigawatts to results, focused close of adds Bitcoin approximately Platforms. is a CFO potential this X this of megawatts quickly XXX XX announced of and our hash strategy privately 'XX, infrastructure of on in the would to to is of focus hash capacity accessible our enabling the and business. mining of with miner path acquisition of rate XXXX Riot's This enhancement July to provides unprecedented of growth the at the over like potential scale. I growth identified turn with EH/s execute call and of now Bitcoin

which I'm Riot key Thank financial results number second of XXXX, of for present to Riot's you, milestones. achieved excited Jason. the quarter a during

of reference, key XXXX. financial snapshot of a the and quarter metrics ease Slide of For second X operating presents for

largest following on pages. Riot deploy the So we the quarter. mining let's continue where second the facility, some over world, our facility miners self-mining the operates expand capacity Bitcoin and Rockdale and owns dedicated go during highlights the in to

during Bitcoin this Rockdale quarter, energized addition, Corsicana fully which new the the as past facility largest dedicated mining facility, our Riot developed, the supplant world. when In successfully facility will in

exceeding and prior facility second Rockdale As our the at of EH/s. relative resulting cash up XXXX in we and capacity EH/s XX total of of from second Mining, with of of XX of our a installed of Kentucky, development now of increase our anticipate successful the guidance guidance and our prior end rate acquisition quarter ended of Block Riot by EH/s, ongoing a self-mining an hash growth result rate XX the the facility, to XX our from achieving EH/s. Alongside additional quarter XXX% XXXX, development Corsicana a energization

in quarter, in which of we the Riot of mined and XXXX. of primarily quarter increased which a decrease network the halving driven XXX XX% second April by Bitcoin, XX% the This X,XXX second Bitcoin decrease quarter increase difficulty, block represents XXXX the by significant which XXXX. Bitcoin was the from During from the event, during occurred the mined subsidy

of increase in relative quarter XXXX we second Bitcoin growth hash of the end the anticipate that XX% our of day XXXX, remainder XXXX per significant we by Bitcoin, expected X,XXX capacity to quarter X,XXX held year, the with of of in second Bitcoin Riot an the the decrease company's ended than by driven the This more producing However, through of rate non-withstanding. Riot the second did we quarter first at the having retain the compared the the Bitcoin of division. total as driven to XXXX, revenue XXXX. year-over-year. XXXX, end Riot all produced $XX.X of quarter for second second $XX decrease by revenue X% to primarily was the a quarter million of of quarter. In continued the XXX% engineering million in reported at lower of

Bitcoin in $XX.X second adjusted Riot was XXXX. Riot's of the at compared hosting XXXX. a as quarter standard to non-GAAP for gross non-GAAP of $XX.X the and mining, Non-GAAP in compared reclassified loss value Bitcoin quarter and in other assets gross income. of During recognizes million now the third-party of previously EBITDA with adjusted quarter recognized profit crypto the of EBITDA its quarter fair on as costs of was issued $XX.X Non-GAAP quarter, first the to quarter into in final now reported December held FASB's for from revenues it, million the profit of value second adoption million changes XXXX, fair in Riot million as which $XX.X in XXXX.

or in million and or at which and of XXXX Bitcoin second first depreciation second was quarter period loss expense $XX,XXX the share price $X.XX per net in held compared $XX of quarter. Net quarter XXXX, million change at amortization the in of was in the a was equal $XX.X As million. a adjustment end the per $X.XX value This of loss $XX.X end quarter a of million share the $XX.X the to of loss resulted price and the $XX,XXX. noncash the the for $XX.X the downward million for of same to mark-to-market compensation $XX.X included fair million, Bitcoin a from stock-based reference, of

for from based depreciation X-year our our a a beginning As adjusted the hardware X-year on reminder, XXXX, in we of mining quarter evaluation a own practice operational of schedule first history. market to and our schedule

quarter as increased XX% of mine for to XX% third quarter the in $XX,XXX to was network XXXX. cost global primarily and million million and the or of of the mining of of quarter to power which excluding in in direct decreased first a Bitcoin $XX.X mining significant million consists of in driven was to margin halving -- revenue increase rate Bitcoin. mining For revenue decreased of of quarter the increase relative cost non-GAAP $XX.X April in totaled a power hash to Riot's have Bitcoin events to would costs by an of reduce quarter cost XXXX increasing actually ] cost the this Bitcoin to increase [ from mining decrease $XX.X $XX to quarter mine in mining global revenue the direct excess representing margins XX% second total basis of basis. This In a direct increasing XX% EH/s, the $XX,XXX per Bitcoin, first quarter-over-quarter. If a production of $XX.X margin by a electricity, of XXX $XX.X and second margin the allocated million mining in XXX cost the our depreciation of revenue, dollar cost million, X% or quarter and of $XX.X a including X% the and mining of second XXXX, costs event Bitcoin only of labor cost totaled directly primarily or Bitcoin per on revenue basis million, a spite but hash amortization. were revenue Bitcoin to Bitcoin a insurance, Bitcoin $XX.X Bitcoin XXXX compared operations halving credits of Bitcoin to mining quarter rate amounted EH/s million. revenue the second Bitcoin in of on from costs in XX% mining average on Bitcoin million, XXXX. Direct XXXX,

minor costs per insurance, totaled and costs, taxes, $XX,XXX, related or other and which Bitcoin. include property lease and related XX% While direct direct land nonpower network minor repairs, labor, utility equipment minor expenses

drivers an increase compared second decrease wholly on of of X-month the was global quarter network as were This chain having to rate $XX.X primary custom behind to accompanying difficulty certain quarter. through Riot's delaying and increase XXXX. Riot's was the average owned Riot's in This recognition million compared therefore, $X.X mentioned, revenue to quarter cost XXXX the the the constraints power million. mine materials, credits offset previously increase products, in of engineering As subsidiary, decrease million the primarily a network cash supply carried business reported slight the of first Bitcoin decreased of as the had resulting revenue. in direct in Metron, of and in completion attributable XXXX, receipts second increase an in an to the $X.X period in for ESS by of in the same

$X.X as will gross million from our now increased for been products was power. Engineering second center generation quarter products compared growth as components has Les. important for call demand data engineering half second gross in the and construction the electrical the as the as Jason data demand and well to are back used for primarily turn driven continued increase quarter facilities, continually anticipate due these data by in million custom XXXX centers $X.X completion power for increasing profit a in a power in business, continued as over profit customers strong by of distribution demand complex to and the such and worldwide for of Our projects. I center of XXXX. to distribution We switchgear the and development center there of developers legacy

capacity increases continue mining-friendly acquisition our megawatts Corsicana the of Kentucky. Subsequent major new expansion expansion new since acquisition of footprint and The development Mining this a consists first access capacity immediately of Bitcoin to marks at nationally expands Riot's and on grids markets of you, expanding The Kentucky. miner broadens power to pipeline and the acquisition Rockdale With now Riot's adds gigawatt significantly power megawatts Block power into XXX at rate. our to local and total our we XXXX hash on EH/s outside opportunities, Thank rate with while our Kentucky, Riot and in end to capacity into potential new to XXX growth in growth achieve management growth strategic second of Riot's Colin. Block of exposure jurisdictions, quarter XXXX, than are team XXX well of operations which while first assets the Riot Mining, will to hash growth energy our to ERCOT operating self-mining target drive represents our have further Texas. of of experienced opportunities. of strategy gigawatts operations our of ] leverage support continue board outside in can way local helping strong This brings facility acquisition an existing of more and X facility, X securing enabling Riot's Riot's unique relationships leverage announced enough and private to pipeline [ of operate which to

gained a our data in of Block operating acquisition of As Kentucky. facilities center two result Mining, Riot, additional

expansion opportunities. immediate Drive, Commerce megawatts Drive be XX potentially operating on Steel, Blue which megawatts Blue First, expansion already second, And Greenfield Calvert in as nearby leveraging operates XX facilities offer Kentucky capacity [ be of XX Steel infrastructure. site in also to Kentucky. Both megawatts. City, of existing capacity currently megawatts operates can expanded Kentucky. to in can well And which ], up Paducah [ XXX as currently expanded up ] Commerce

be all XX rate Riot's year. [ XXX provisions, and Block this wind control capacity exercise megawatts, capacity capacity. a which expansion Coleman overall an operating Corsicana past developed power credibility growth coming And and bring megawatts few anticipate we megawatts host be and visibility forecast. Thanks Additionally, being on to megawatt growth our development to as has of to Together, but past capacity the our Commerce subject further Road of X on to [ approximately end while ] demonstrating benefit of new total Drive used significant year, which the path miners specific Mining to Riot's of will groundwork power to cost just few our of next also have Riot's site, over change will continued expanded immediate laid self equal towards of X result steel. Riot to we Corsicana XXX cost on long-term new would Riot total will to megawatts over operate as where the well at XX the present, long-term XX.X to capacity, to with date, facility quarters, of in the site megawatts remaining improve by capacity vital down self-mining acquisition growth in as latest orders a miners is fixed third-party will there was now acquisition of focused generation provide growth of $XX facilities ] of our intends just up XX,XXX added ASICs greenfield Bitcoin both MicroBT X.X EH/s mining to fleet EH/s. Riot's a joules total goal additional potential of as this per the contracts self-mining hosting on adding in from. the currently of majority the XXx schedule this any MicroBT EH/s order while approximately the Rockdale deployed. up growth as hash MicroBT with power growth or at have from which This with bring to XXX to capacity, consideration total strived approximately XXX a of terahash. of in towards Corsicana includes purchase ASIC CapEx MicroBT million the per on already element our over facility, mid-continent opportunities Phase achieve a clear require deployed, work out we Riot's our option, fully efficiency, of from purchase proven in growth ] the bitcoin the an historical at which with low-cost excluding the facility, Block $XXX come EH/s price is sources carries miners capacity we ahead on additional not and these it megawatts, capacity. Under independent during as a team well favorably opportunities clear believe this have deployed build-out consideration. opportunities, on of $XX a has MISO Grid, years as years. Riot's clear approximately Mining. Executing megawatt facility additional This portion record $XX.X inclusive received miner. low-cost Block purchase purchase operator, across develop Blue path Kentucky, as $XX Operating in from EH/s [ average importantly, million pipeline of goal of our approximately have representing Mining significant per expansion mining per track and price reaching To at Bitcoin EH/s compares plan low-cost has of near-term at continues when existing achieve minor guidance average cap, development capacity Block to we exahash we and the a $XXX,XXX that providing ] vast day the XXX EH/s. The for now developing of to anticipate as cost growth million these and total We plans, hour. Power million we track can developer Riot a been a assets for our or our for our system had at in $XX.XX per of EH/s received our alongside options miners terahash infrastructure Mining for [ or achieving of X

generation to As efficiency its XXX,XXX it executes terahash. Riot including Riot's ] our per for value order strong deployed, a continues purchase holdings terahash miners, sheet to cash, and maintaining for total it additional and option XX fleet miners will Bitcoin joules resources, below to creation fleet prioritize MicroBT long-term with balance XXXX. would long-term to marketable of efficiency total XX significant shareholders. drive improve in in securities [indiscernible] improve [ joules exercises If received financial are new per

needs based us on funding to X,XXX can scale and position, space. This and of and Bitcoin, securities in Bitcoin $XXX our decisively plan ahead to marketable enables growth continuously the cash opportunities time. confidently growing million the balance in strength of our we As act a our meet business result mining sheet financial

infrastructure XXXX Through pipeline strategy our in have of The us the of growth plans EH/s hash XX to several over realize our created In to executing funded. year been we be which end rate. Riot's already vision. and has by hash on self-mining fully strength the to leading fully strategy, world's XXX begun are end years position an for $XXX targets. varying result, unmatched we've to plans the vertically XXXX calling total capital fact, this now to driven ability the increase vision a expenditures And funded. Riot's results, million Bitcoin is past to the integrated to our EH/s ultimately our achieve our of XXX% growth goal in XXXX infrastructure are this reaching rate underpins by growth and our sheet balance growth as platform.

We are now incredibly Operator? about on all would executing to for Thank the open forward call and is like look year, our goals. questions. for accomplishing to excited this our stated to what Riot presentation. We we you listening

[Operator Instructions]

take from the first our Operator, you will line? Greg Lewis We question BTIG. of open can

a the next was time guess, what's Jason, on coming. question around I to long Corsicana it is I getting congrats Corsicana. have [indiscernible], but

kind that as i.e., that to expanding probably also permits needed to going next Corsicana? to in about, or So the we to as happen maybe what megawatts, be that gigawatt and what there, down of any of get get in substation are there needs approvals else equipment, to additional procuring XXX think terms about -- additional we think are

for Thanks Greg. question, the

we're what we're So encouraged very about results seeing with at Corsicana. first off,

improved. about X that So operations is interconnect that and these already advantages we excited valuable to the very of Corsicana are over created. What's gigawatt scale we've is base fully leverage up that

with large X flexible ] load a gigawatt We task force. approved [ have

all We are FDA there. required to approvals regulatory that required the all have power, the access of

would of procuring out all to that equipment building substation building. build equipment second to step and then to be the next necessary the the transformers necessary phase, the expand an So additional megawatts, XXX that and

et voltage transformers, voltage So low immersion tanks, medium then switchgear, you gear have cetera.

time our starting products we we're Corsicana, that belts we're the now some to phase. So operating to get best here for at able under like which identify second

to monetize of X capacity gigawatt So of very excited we're that full Corsicana.

I particulars like the in about second We're these And together, about think to putting be now due on site development process, update the plans taking in cost that. But going through to phase. very that here, getting time gigawatt. X those the that from making terms are what We line an we're look we'll course of bids plan and share vendors. excited full other able full for

and Great. #X Okay. as acquisition, Riot. that pivoting little And ESS bit, just Metron's realizing think about Metron I customer then ESS that a is

potential increases increasing that to obviously, ESS capacity to towards up for As think I be be ability the ESS maybe equipment, only for over for to we that grid, with years, scale a demand capital centers, vertical there's clearly, to we of potential mining. I demand Bitcoin data scale mean, in and how Metron's fill market? as think deploy about guess, should to or increases down, the demand that rising about X we the X seems services get thinking to kind next business to the the potential that has about broader the like to unlock

Yes.

Riot small So They actually far overall. a not -- we're is first, aware. ESS a customer Metron's as as largest cost have I'm customer

all data have center As jobs Greg, of major extension up HPC as AI the that and we by capacity. little you're quarter some last the their taking on kind impacted constraints with of been is demand results huge now. Their right been a late supply have ] there legacy noting, of that chain space, bit [ touched of

of a to done we've number So things alleviate that.

to believe now doing once job the Over the half all through, happen HPC clears we start center second second which in chain to we -- these in we'll supply the the and be expected -- constraints AI able this jobs this is quarter, year, data of space.

excited about that. pretty we're So

that scale -- able production at as are capacity, additional been do to so We to been we've to at we secure also other more And looking business well. they're working opportunities one have time. floor

to have business, center our in can in tell of Greg. making definitive on addition well. focused mining capture I data is space that Bitcoin don't ESS you, give the or guidance I the are any type to sure scaling as to like you, equipped number we a Metron opportunity So But

from our next Aftahi take MKM. Operator? question from we'll time, this Darren ROTH At Okay.

hear you guys me? You

Darren. I hear you,

I may. if Two, Great.

guys in about favorable you First, we kind category that we have exahash obviously, kind of kind light for a on larger ] many [ we about [indiscernible] of are to as have a seeing thinking are new organically? cycle, side. also just the the about there. How Is entree There's with acquisitions? Second some of going growth XXX over power you going more think achieving now was a to procure And assets, I'm cost buying your from power question, Block the Mining chasing Corsicana. to [ ], Nashville. Democrat talking And presence challenge last as i.e., know people strategy conservative curious involve guys the than you XXX-plus of goal? and we more of all just being came assets, maybe I there back ] halving large more [ presence.

Democrats, So about what how kind for party come election you have will and the play the thoughts then of do Bitcoin now? more I general Jason, views feel to are a maybe you'll your and and like think curious Republican in RFK you is just this, than right I'm crypto get of beyond your around in role tailwind already to going even even a

Thank you, Darren.

Okay.

question we power. getting XX business has focus foundation where The to vertically been EH/s. we first at our integrated achieving how So look this on strategy to on access

X capacity over have going X prioritize now, we So gigawatt that's so would that why securing we that pipeline. back Corsicana years

that results you it benefit with secure can community we've doing we're our How we So successful our at inorganically Darren, always noted, and our doing been Texas. demonstrating power that well. in and this And is capacity organically as focus as Riot. #X

the I and best team development corporate think in Riot industry. has M&A the

those And incredible at in and diving all deals We we We're time. to are that are over accretive think Riot. capacity scarring any those will with moving we're add forward into detail. deals that

and So pursue I'll second with you'll power in to capability getting Riot, see things necessary Nashville question Number just Riot's these to us to market at ultimate priority, development doing and to very capacity. On We're opportunities, being But that you organic is to policy. as public always, we're this going our about going one to very, internal deals. the continue be securing and at leveraging both leave develop to looking the and goal. of selective. your get sourcing capacity equipment

Whether So of Riot our industry. saw began because we effort the entire We House, the whether space. years department, angles. government the in be public SEC, Congress, X had this it White we it attacks -- threat been tax policy be in about ago on the whole at there every looming saw investing Treasury around a this have

So with our to to own working with we whole needed in order this we industry educate knew protect investing in industry, business and working our -- to the being and industry. in this peers, groups advance

We have aisle. of success the both had sides on

presence, just strong who to get it. know addition advance time, and at and conference this very trying Nashville you issue the Republican in While Democrats had a itself the to predominantly some -- and before conference we with all the work collaboratively

think to this a national important. And party the Bitcoin what and the reset that's the apply embracing have support to in to we're Harris's party reach seeing play [indiscernible], who theory more relations. we're industry a takes one to news party regulatory that Prominent looking industry and and that the encouraging game show letters to angles. It Bitcoin the allies why issue. Vice campaign, is people Democrats lots seeing writing out out. I to reports different playing President out other already to are of framework think There's shift been in been the I for begin of

our action. we success strategy of in as So this see

a the an Bitcoin issue, politicians That's to everyone. is get Bitcoin, politicians, the nonpartisan because As same. result for that we're there's lawmakers towards. going to Bitcoin more to other prominent do work to behind be, incentive trying And is important is the end goal

comes Securities. question at Operator? Lucas next from B. Our Pipes Riley

that afternoon, HPC Thank Jason, attention A of you it host [ wanted much, Well, everyone. to using Riot about the peers in have? the in to kind a gigawatts, how terms the power And how Phil. talking ] the one, you think very about industry? more little side GPUs. does And bit impact getting the been has amount it broadly, I then of megawatts about your Good and might of ask of of this? industry. to portfolio number

Lucas. you, Thank

in to So our best on has out. yet, different miner has Bitcoin is of perfected miner take a business be everyone Everyone Kind the this the approach, Riot. thesis sector. is, still figuring including this plan is no our Bitcon

of we resources to the devote do those forecasted That will is our foothold the what Bitcoin Bitcoin Bitcoin our this will use optimizing the is our miner for mining term, can. We most pay we long operations, be that operations off want time, So believe combined best Bitcoin valuable mining, price that power. appreciation and over long scaling our with the of being to term.

discussion in certain take the development really industry players AI, it there's getting does involved a getting capability. different or While of in contracts

us, for a distraction. be would that So

excluding of possible will or work type half. timely in -- We back our all, that to be out. building of didn't We a Bitcoin at be infrastructure would mining not to would costly or that capacity that revert operations different maybe be commercialization if

we mining stick always on building strategy, and assets. long-term Bitcoin our to Riot important So consistent to think been it's developing

over more believe of looking help These are is loads phenomena? Well, recent how affect like AI find the generation. growth mining goals, But reach are I will this loads these loads country. AI to We can capacity there going assets data Now they're for are necessarily seeing generation. for all whole not the flexible, HPC This and wherever massive goals need Frankly, competition ultimately, think centers all they energy it a drive assets. AI flexible. Bitcoin Bitcoin more to HPC mining we're industry? for that their capacity the

we at that a reliable still operate what And demand forward. I communities, with an to flexibility to So going have turn mining bring peak to with able more Bitcoin help able time. may do maybe baseload other data -- off think to centers is bring not to generation where this for in advantage tool generators Bitcoin the energy be operate. these miners areas more be we're different rural in

build [indiscernible] more AI hot very to I think expensive, work. mining it's also Bitcoin to infrastructure you build challenging a where HPC and can make in certainly

Riot proving X think and can strategy for sourcing of build prioritizing power I competition So we that a there's we capacity is more now capacity, have gigawatt that on. this

very organic get pipeline the close have to our to goals. ultimate achieving already We us

Mining you next and strategy. the congratulations to in perspective wanted ask the announcement could M&A very thank to regarding I at the details investment you the about your on bid in Block farms. Jason, on regards much and the point? steps you for shared Anything this share

Sure.

bid So example shareholders. while we brought the was was proposal farms, I ago. a have no seeing we bid bid public as with proposal. that of to concerns our at know we we That never That of see as a right at of forth we farm. Frankly, challenges had made tendered farms. corporate now are governance kind outstanding some

handle on how We based single [indiscernible], off-market with their based its is its our on is they shareholders. proposal, an implementing duty them they relationships our are over view shareholder largest Board the to valuing and how handled own that [indiscernible]

repositioned highly scheduled of think that October only we qualified there. for those and think, -- independent the bid the thing farms We've that XX. now shareholders nominating We meeting that Riot farm's governance is and nominated scheduled both We required the that's bring has see ]. special to to being step very [ port much-needed meeting, meeting. we bid the directors So will next X, for our right changes

right that So the on shareholder nothing now. except meeting plans for

Smith will JPMorgan. Operator? question from Reggie come next at Our

HBC. My partner appreciate maybe you, is to where the a could the explore you question Corsicana and are question. right for guess structure and the acquisition. I on structure, this I had your approach intensity Lucas' a Jason, price Mining deal capital or or to Congrats you? those there the pivoting right risks And I possibly a follow-up Block mind certainly risks partner see some Is that in you there mitigated? where mitigated at could scenario be where that of of

Thanks for things price some there's to Reggie. interesting. Obviously, the question, be where

when Bitcoin factor pricing I is a that be less in see uncertainty. we as going challenge generally in we think see you the long-term is the to that out upside perhaps there is then

other challenging think the I of pursuing we're them. the these duration seeing contracts things in that is

space the seen with at [indiscernible]. got about right haven't excited look we Core what has anywhere this. excellent that yet. But Scientific is if replicated the we whole think an Their I now, industry has deal deal

Core there development at there hey, industry a that is type is, over are time similar HBC very there these applications AI question on, that to my for out very behind is deal favorable structure even So of that's enough we're all demand out chatter think seeing capital that long the pace there? I being plans the commercialized. are

lot there's a uncertainty of that. think around I

actors. are hey, economic rational So we

with the was things the I'm adjusted Bitcoin yes, to that's that, So ever we take potentially that incredibly at a as risk what would that. of point, out could be something [indiscernible] business beyond at some if skeptical Mining for look play going do that we case. was there

if I uptime curious, Understood. like what's the But an opportunity to had was comparison. be how unfair there's track we is guys follow-up, perspective? performance, of Are it? That color. benchmark and you you enhance and one with guys I with aren't or we you And improving you the a makes operations internally that? way an there if guys of various try clearly, path that kind to lot operating the cost sense, an your And may If happy an at to and could miners, happy But to appreciate add advantage. this [indiscernible] I look you from opportunity efficiency. a

improving I That pleased at and look operating to have uptime we [indiscernible] that. with historically, be that's our frank, what Reggie. we Corsicana. with mainly not been results, Yes, through you our on at if of coming going recent have not is mean, going

have infrastructure there. improved We

of that, think optimistic just [indiscernible] ton very that's have we seeing We're turned problematic and as And lot we're of tweaking miners that we the seeing with over very encouraged of about are about days. on, initiatives very a talked optimistic. July. But are on very miners, goes we early month we're what time one even Rockdale, as microbe at more. In a We seeing. on We've underway. have time. over of the there. we're We parallel, results the going And what optimizing replacing improve. got in to still at with us some improve in comes preliminary operating We're the results that

standard. and and the think seen to new the we the capacity alongside that leverage wider see very that's energy we So now building improving July to probably combined that see Riot at we a we've cost biggest frankly, with a progress next priority high some significantly Reggie, per holding over this as Bitcoin some wider operating our update Corsicana. results And are week, expect ourselves scale here scale, I up of you'll direct improved uptime, some front. have see we're here. We'll on already going for and monthly -- to at

Research Compass next Flynn Our Trading. call and Joe will Operator? Point come from at

Reggie's off question piggyback uptime. to to Just related

the maybe maybe we strategy into can expected curtailment the on and quarter, power an once hot look summer the with As provide guys you third update any here?

specific I percentages looking we're So the at what don't have summer of any months. for

curtailing just power power megawatt As demand, we XXXX, strategy as strategy. achieved cost we megawatt at second per power during spot of of we at our -- received $XX power. quarter and far in Corsicana, hour the the of cost achieved inclusive Rockdale. per of at $XX buying That's a high goes, of hour a power periods And

combined quarter one is and by [ ERCOT for basis, in of cost ], of both extension, $XX. August a more second to So power was the the see our we the volatility both market. in the typically months with challenging respect on power

has if mild pretty a so Texas So summer. far, --

and added seen growth year Texas. both in we've large renewal weather because that's this think I generation mild of

good So you we'll from a I should July this into see August, expect for power mild level if and and summer that. see going what then continues of comes or cost not think curtailment of to

think as some And Corsicana That's ramps of we get up? we increase in sequential how And SG&A? forward should about color kind could the helpful. maybe to also cash that going

Yes.

wasn't quarter-over-quarter of increase in because, the Corsicana. So really SG&A

main proud this reason other to despite was increase advisory about is increasing our are to for of figure the And Bitcoin and net that G&A, have really XX,XXX quarter-over-quarter cash we're cost I difficulty. went per scales and per marginally low linearly our of XX,XXX more that is having activity. up associated That that direct despite we strategy how when the the only power energy. quarter cost is around cost think scale mainly the the consistent. With from for driver we onetime what costs with this these fees respect M&A up Bitcoin

rate M&A past aren't fees temporary are if believe part expenses having of well. And $XX successful those the for we could around So had opportunities advisory in ongoing still million. We're our G&A run that our operations. quarter going these is increase But M&A that cost forward. we've as some

ATB Capital. Our at from next call Martin comes Toner Operator? Martin?

to unmuted. unmute your line you your May please? your has from side, Martin, request I line been

Sorry EH/s? miners XX thoughts to get to Any the about from XXX miners. strategy that. Quick question EH/s on about the secure to

capacity So for we our secured have existing [indiscernible] if to option, option XXX that XXX,XXX exercised with MicroBT we that get so EH/s. miners. purchase MicroBT to Martin, the fully That's or

all We're and time. the upgrade questions, manufacturers Of on. efficiency improvements, market get testing we're looking we're asking at ability even would under with We're are putting that have all we greater what's also to to the contract, what that, rate. Alongside going to those course, the hash the miners out negotiating.

our for benefits of for products the business get manufacturers competing we like Riot's we seen of the up of always when are is business. grabs, firsthand. All We've and results that that any

is the question, looking existing So even options that. short MicroBT the us to supply to we're answer EH/s, gives XXX enough to but at to option beyond purchase your Martin, get go

customer. Super. was stands? revenue the which us believe little give of remnants of disclosed, on I hosting was where Can the a you update the that

Sure.

the Colin to CFO, me question Let turn our over Yee.

Thanks, Jason.

include more with our revenues discussions information we others. Martin, third-party useful would into contracts, and our of hosting third-party those decided status auditors, with could we management So the hosting in conjunction hosting be costs that it given

to litigation. see generally So respect the status current sort you'll know, that, of in those contracts you are it there. With on as

than more anything say can't we So that.

Stifel. Our next P from call is at Bill

the acquisition. Mining on again once recent Block Congratulations

dynamics my for Bitcoin For this to was the how the impacting your share Riot Obviously, near over positioned just existing growth is pipeline M&A the current question, in able market. I or outlook term. these first financially well opportunities? mining are be economics And you'd market hoping to

color get some Looking there. more to

price, stream economics than terahash Bitcoin or at been. ] second per ever seen the Bill, the over even per and you, day. industry We Thank saw all-time per [ -- $XX mining low question. they we're more an the per have today, -- quarter, We've $XX day hash for Yes. terahash

the challenging So definitely for had to difficulty time price increase. a is not continued much economics. appreciated halving, since the but has Bitcoin network We've halving mining the

is foremost. and why obviously So on focusing a and such strategy production this low of we power on first focus the cost having

for are this continue but find acquisition of that miners Riot, to a to Where unable things is structure have cash is why a a for where That a fleets, to do where relying and both more do maybe player, financial in to is They potentially think the who have them have need I -- [indiscernible] it. creates don't to to these M&A make type an well-capitalized can see response like their capital partnership they business. upgrade there Riot outdated to where opportunities. Other we do prices That miners opportunities. parties. as have dynamic the is that or can unprofitable it through big win debt some on able with fleets.

on said, that a opportunities at detail the and to we opportunities at incredibly Like development we've always transactions to team footprint. up. on proud are evaluate of assembled basis, I any in our Riot, corporate that operating which the able interested I'm closely So is and come whole our we're scale looking regular continue team to

is response. here. super space that I Jason, for know you team and outlook bullish Bitcoin your Thank on the the

to a bigger ask I So wanted question. you picture

States. on we a top of protect all week, and has the the conference reserve the lot Bitcoin strategic a Trump it's announced some a variation plan [indiscernible] the to in in industry help political based amassed hash at punching [indiscernible] of becoming establish what and United sphere. last Just mind saw XXXX is evident that rate of transpire network to and power

you state the between that. Any road the potential convergence if down Just Bitcoin miners? curious color to and see

determined. something into capacity. that partnerships Yes, think are -- monetize to United nation excess of have wealth to the funds, are already that we entered extension be is is we sovereign overseas. an obviously Where Riot competitors seeing of in at our the least some with that States I which seeing to state are

the our is accumulate we're is a markets between think we're as cheaper thesis tool -- power generation energy to fundamental ideal pricing, energy close government there and utilities. But Bitcoin -- the is to seeing and relationship typically not best I mining is Bitcoin. the where the

at With if a the energy you accumulate cost the can low efficient your you market Bitcoin price, cost, to discount dominant an input operator. you're

the desire So to to do with a assets ability the and had state if good a that, seems underutilized Bitcoin, paired accumulate that like strategy.

the ever States there. get a think in bit be will I to slower United

quicker the future, I I in of Things be government bit will are course, with a a at level But think paired will move -- to able think stack. in partnership with nations, include other there. that some governments maybe every the place way. And in less the long-term energy democratic in assets with mining nations. see of we Bitcoin

from next Cantor Fitzgerald. Brent comes Knoblauch Our question Operator? from

you a guys all you one it? And Is adding are but assets -- Is what I of landscape? of be maybe additional are or Perfect. that bit more assets How U.S. would it unstable entire you when just might be for about, kind And environment? it M&A. you prioritize look that power? affordable, Is are to do might location? more another it -- international of what access coming Maybe political costs guess, in I where opportunities guess evaluating evaluating Is a it just extent power you? how size? from think to guys it the front on

Brett. Thanks,

question President Corporate Development. to Vice Head and over our that Jason me of Let Executive Chung, turn

an one. thanks for question. It's Brett, the interesting

let guess, part. me I part tackle by that, So

in when M&A look part of at first terms The we we at opportunities. what look

foremost Power First and power. top always of is mind. is

what is in So an cyclical, know we are at on to the in very means We're access power, cost power of cycle to that long-term us of a that what cost different power that come. and points to take what means for means try that -- is the going right? industry we and view

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And just don't the follow-up on ]. capacity one within -- maybe PGM today [ if in Is the auction no? or you quick I assets Kentucky know felt like PGM

assets Authority. value the and are Kentucky TBA, in MISO No. Tennessee in The

not So in PGM.

next Our Grondahl at Northland Operator? from Mike Securities. question is

on today, challenges? challenges there? those Just the as pretty pretty you as but Kentucky operational It's looks acquisition. a see see the operational you follow-up What do the What growth guys small do significant.

me Let that turn Chung. Jason question back to over

Riot's to contribute this the Thanks, to huge about balance opportunity think team target. Jason. that. EH/s end both the with that Right of one is of get the we're the for really expansion deal [ tied benefits availability to of what of capital tying capacity and strategic sides we on have team is the availability this strong to that now, sheet benefits want -- capacity. ] to next the the one of We Block Mining year self up I And operates X mining XX.X of

and the term, take near expand happen. more to going be getting on is to in of They really think focus and bring relationships bring I building help the capabilities So the out on new PPAs. ground, opportunities also to capital the we make to through advantage access and the those on to the power existing

So to of there. from opportunities the it's that to and [ building just interesting advantage come but we of down think out perspective, ] that ground. taking have two I the there's marriage on really really expansion the going companies

Colonnese Operator? from Mike Wainwright. H.C. question comes Our next from

course hash time. Congratulations [indiscernible]. of with progress the in lot a of all rate in of a That's short amount

see that. to great So

guys of over First it just could longer to air share in versus what the term to today hearing to of out the one relates been really Mining's per you you market infrastructure starting Kentucky? you're plan emersion come to as cooled down immersion air you Do cooled megawatt here on me. opportunities megawatt basis. or as price immersion. for pipeline to build if Block in deploy a seeing cost and And We've talks per the convert build near

space. the get there. thoughts in experts are I your guys to you wanted So

Sure.

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assets. operating results I cooled shown think very with their they've strong air

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equipment of -- of it. equipment that there's bunch goes into a Some the

on better is is equipment getting the for what expensive. pump but or getting cooler, price be dry think but fluid So may example, be may maybe I more a you cheaper, maybe is more a expensive

of bids yet. put in to So significant there. I bunch determining process we've change [indiscernible] together But of market of what that there's and that expansion seen getting we in still don't we're the too a equipment a think will Corsicana. in

after of have going that through answer And look determined your So be a will it's what to final kind we'll exercise, like. question. that better then to pricing

from how Got the highlighted really color boots local some team I appreciate into the Mining skills broader board? this any And do skill or resources ground you the know notable noteworthy of are relationships it. on brings you integrate plan it. to this on Riot? sets Block that management to there. team the I other But bring company? that the could Got team MISO. with And resources what

and Yes. showing job strong building done Mining The excellent very Block uptime. an capacity has quickly operational team that

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already at the growing and what their Kentucky, that couple with they for being relationships that out be done, they do capacity doing in what you out local good been So to and and can they've there. they've capacity growth secure able

So Kentucky they our into really fit Riot as basically division.

to course, have a of ] together cumulative ARM of is core well. our of game operating And to have, this. is as We There here can And we book knowledge. these over of Texas. Bitcoin Kentucky time. knowledge now do no [ this the is mining what's operations then work on great a all share in how teams base

So share doesn't everyone they've make and can works what learned what and [indiscernible]

John more We've Todaro got Company. one question from at Needham & Operator?

or longer second then question. And did world just outside ] deal pushed AI new hear So term mining? remote the those that [ that Two you That's here. U.S. One, a more the mining question, Bitcoin suitable a starts mining be pressure you. hash where world stuff wondering big Bitcoin competitive if do Congrats to see other on you might a Dorsey's even you rigs, maybe Texas the growth to Do locations? become Scientific. with for for do is sites? they see the or first you HPC Jack even diligence do Core

have thoughts wondering that that any Just rig. on in if chip you

Sure. Thanks for the question.

an tell with manufacturers are So things won't ongoing. specifically basis. anyone's discussions team great I'll while on ongoing [indiscernible], in I comment you, evaluating speaking a here. backwards, are starting all products on you're having we and

they lot to see a how invested be interesting Block very know I It has this achieving So will progress. in goal.

others, to talked all So we at talk any don't want as not but give we've I anything direct public them on this time. to to commentary necessarily that's

competing yes, as I with think AI, be HPC for AI far access do As will to miners with competition bitcoin power.

comfortable operations. easier I bit grid the with nature because miners are of HPC flexible get think of than the AI for our to a Bitcoin

a have an capacity. miners in approved So advantage getting bit is I easier. little think there for Bitcoin it

That claim of Bitcoin less they if is diverting for slower, that AI mining and thus capacity other being mining used HPC growing and the is us. There's good instead our focus, Bitcoin capacity that's or HPC, and to mining. is Given rate means core are their difficulty AI more cash miners for network competition.

questions. Thank no joining call, forward Okay. in At this progress updating November. on second our on time, there's to further Riot and our We we thank earnings you everybody look for you. quarter

Thank concludes teleconference. This you. today's

lines participation. You may disconnect now this for at time. you Thank your your