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Hut 8 Mining reported a revenue of about $19.2 million in Q2, a significant decline from $43.8 million recorded in the same period last year, mainly caused by increased mining difficulty.
Toronto, Canada-based Bitcoin mining and blockchain infrastructure company, Hut 8 Mining Corporation (NASDAQ: HUT) released its Q2 2023 financial results on Monday, August, 14. According to the announcement, the company experienced significant Bitcoin mining challenges, which reflected a sharp decline in total revenue. As a result, HUT shares closed Monday trading at $2.78, down 6.4 percent from the day’s opening price. However, HUT shares regained about 2.52 percent during the after-hours session to trade around $2.85.
The heightened demand for Bitcoin and other digital assets amid mainstream adoption has significantly increased the number of crypto miners around the world, hence causing a sharp uptick in mining difficulty. According to the latest on-chain data, the Bitcoin network had a total hash rate of about 415.17 EH/sd thus a mining difficulty of about 52.39 T, with the halving event about 255 days away.
Hut 8 Mining Q2 2023 Financial Highlights
During the second quarter that ended on June 30, Hut 8 announced that it mined about 399 Bitcoins, which represented a decline of approximately 58 percent during the same period last year. The company noted the suspension of operation at its North Bay Facility, and ongoing electrical issues at its Drumheller facility significantly contributed to the decline in Bitcoin mined. Notably, the company announced that it sold about 396 of the 399 Bitcoin mined during the second quarter and received proceeds of about $14.7 million.
Nonetheless, the company announced that it continues to push beyond its boundaries to ensure its long-term growth prospects. Moreover, mainstream adoption of Bitcoin by institutional investors is expected to take place in the coming years.
“We continued to build momentum toward closing our transaction with USBTC by progressing toward receiving regulatory approvals to proceed and improving our projected post-merger self-mining capacity to 7.5 EH/s,” said Jaime Leverton, CEO of Hut 8.
Notably, the company’s high-performance computing operations generated $4.2 million of primarily monthly recurring revenue during the second quarter compared to about $4.7 million in Q2 2022. During the three months that ended on June 30, Hut 8 announced that it installed a total hash rate of about 2.6 EH/s, excluding the company’s North Bay facility.
“While we continued to face mining challenges during the second quarter at Drumheller, which are reflected in decreased revenue and fewer Bitcoin mined, we were successful in strategically managing our costs,” said Shenif Visram, CFO of Hut 8.