Release Date: November 12, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- MARA Holdings Inc (MARA, Financial) announced the addition of approximately 372 megawatts of owned and operated capacity across three sites in Ohio, enhancing their operational scale.
- The company acquired two operational data centers in Ohio at a low cost of approximately $270,000 per megawatt, demonstrating their ability to secure cost-effective acquisitions.
- MARA Holdings Inc (MARA) has increased its total owned and operated compute capacity by over 70%, providing greater operational control and potential cost reductions.
- The company's strategic expansion has increased its total nameplate capacity to just under 1.5 gigawatts, with approximately 65% of this capacity owned and operated by MARA.
- MARA Holdings Inc (MARA) holds over 27,000 Bitcoin, providing financial flexibility and potential for significant appreciation in value.
Negative Points
- The company faces challenges with the fluctuating price of Bitcoin, which can impact financial performance and investor expectations.
- MARA Holdings Inc (MARA) operates in a highly competitive market, with increasing global hash rates and difficulty levels affecting revenue generation.
- The company is transitioning from a traditional mining model to owning and operating its own resources, which may involve significant capital investment and operational risks.
- MARA Holdings Inc (MARA) is exposed to regulatory risks, particularly with the evolving U.S. government stance on cryptocurrency and Bitcoin mining.
- The company is reliant on strategic partnerships and acquisitions to achieve its growth objectives, which may not always yield the expected benefits.
Q & A Highlights
Q: How does the recent acquisition align with MARA's strategy to reduce energy costs?
A: Fred Thiel, CEO, explained that the acquisition of data centers in Ohio allows MARA to lower operational costs significantly. The focus is on sites where they can generate electricity at a lower cost, such as through partnerships that enable power generation at around 1¢ per kilowatt hour, compared to the typical market price of 4¢. This strategy is part of MARA's transition to owning and operating its resources, reducing dependency on third-party operators.
Q: What flexibility does MARA have with the Ohio site's connection to PJM?
A: Fred Thiel, CEO, stated that PJM provides opportunities for power trading and hedging, which will help manage power costs effectively. This flexibility is expected to enhance MARA's ability to control costs as they expand their operations.
Q: Can you elaborate on MARA's Bitcoin holding strategy and its financial implications?
A: Fred Thiel, CEO, highlighted that MARA has purchased Bitcoin at an average cost of $60,000 per BTC, which has proven to be a valuable strategy given the current Bitcoin price. The company holds over $2.2 billion in Bitcoin, providing financial flexibility to generate yield, subsidize expenses, or fund equipment purchases. This strategy positions MARA well for future market conditions.
Q: How does MARA prioritize capital use between Bitcoin holdings, site acquisitions, and other opportunities?
A: Fred Thiel, CEO, explained that MARA has a well-defined plan for organic expansion, focusing on owned and operated energy and data centers, and collaboration with AI hyperscalers. The company is also investing in technology development, such as custom miners and immersion technology, to optimize operations and reduce costs.
Q: What are the financial highlights and areas for improvement for MARA?
A: Salman Khan, CFO, reported a 93% increase in energized hash rate and a 35% revenue increase compared to the previous year. The cost of revenue has decreased due to strategic acquisitions and organic growth. The company aims to continue reducing costs and improving financial performance through strategic initiatives and acquisitions.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
