The third quarter of 2024 unveiled a tale of strategic divergence between two of Wall Street’s Bitcoin Miners, as Hut 8 Corp. (NASDAQ: HUT) and Bitfarms Ltd (NASDAQ: BITF) navigated through challenging market conditions with notably different approaches and outcomes.

This fits well into the broader picture of an industry that, despite rising revenues, could not achieve profitability in the past quarter.

Two Bitcoin Miners from Wall Street Chart Divergent Paths in Q3 2024

While both companies demonstrated resilience in a post-halving environment, their financial results and strategic initiatives painted contrasting pictures of how to succeed in the evolving digital asset mining landscape.

Hut 8 emerged from the quarter with a positive narrative, posting revenue of $43.7 million and achieving a modest net income of $0.9 million, compared to a net loss in the same period a year earlier. The company's success can be attributed to its disciplined operational approach and diversification into high-performance computing and AI infrastructure.

Their energy costs showed rising efficiency, dropping 33% year-over-year to $28.83 per MWh, while maintaining a competitive mining cost of $31,482 per Bitcoin.

“As of October 31, 2024, our development pipeline exceeds 5 gigawatts, with more than 1.5 gigawatts under exclusivity,” commented Asher Genoot, CEO of Hut 8. “Three projects from this pipeline are particularly promising for large-scale AI data center projects. Collectively, they represent over 430 megawatts of capacity, with power delivery expected to be available before the end of 2025.”

In contrast, Bitfarms generated slightly higher revenue at $45 million but recorded a substantial net loss of $37 million. The company's aggressive expansion strategy and fleet upgrade program, while promising for future growth, resulted in higher operational costs with their total cost of production per Bitcoin rising to $52,400 in Q3 from $47,300 in the previous quarter.

Despite these challenges, Bitfarms demonstrated strong operational growth, increasing its hashrate to 11.9 EH/s from 10.4 EH/s in Q2.

“As previously communicated, 2024 has been a transformative year for Bitfarms,” stated Bitfarms’ CEO Ben Gagnon. “Year-to-date, we’ve refreshed nearly our entire fleet of miners, significantly improving our mining economics, acquired one new site and entered agreements to acquire two additional new sites in the U.S.,

Both companies maintain robust balance sheets, though with different approaches to treasury management. Hut 8's holdings of 9,106 Bitcoin valued at $576.5 million, combined with $72.9 million in cash, represent a significant war chest. Bitfarms maintains a more conservative position with 1,147 Bitcoin ($73 million) and an equivalent amount in cash, reflecting a different risk management strategy.

Top Wall Street Bitcoin Miners Cannot Stay Profitable

On Wednesday, Finance Magnates reviewed the quarterly reports of three other publicly traded miners: Marathon Digital Holdings (NASDAQ: MARA), TeraWulf Inc. (NASDAQ: WULF), and HIVE Digital Technologies (NASDAQ: HIVE).

It seems that so far, only Hut 8 has managed to reach modest profitability, while the remaining companies are in the red. MARA, the largest public Bitcoin miner by market capitalization, recorded a significant net loss of $124.8 million in Q3 2024, despite generating $131.6 million in revenue. The company’s operational expenses rose by $40 million over the quarter, overshadowing its 34.5% year-over-year revenue growth.

TeraWulf reported a net loss of $22.7 million, widening from $19.1 million in the same period last year. Although TeraWulf achieved a 42.8% increase in revenue, reaching $27.1 million, its Bitcoin production dropped by 43.4% to 555 BTC. The decline is largely attributed to increased network difficulty and the impact of the Bitcoin halving event in April.

HIVE showed a pre-tax net loss of $7.3 million, an improvement from the $22.9 million loss reported in the prior year. The company generated $22.6 million in revenue, with a substantial portion driven by its diversified high-performance computing services.

“As Bitcoin reaches new all-time highs, HIVE is positioned to capitalize on the momentum for green energy and digital assets worldwide,” commented Frank Holmes, HIVE’s Executive Chairman. “With recent regulatory developments following the U.S. election, the environment for digital assets and Bitcoin mining is more favorable than ever.”

Despite higher production reported by the largest publicly listed miners in Q3 and October, overall mining revenues declined for the fourth consecutive month. The gross profit from daily block rewards fell by 2%, hitting its lowest point in recent records. Miners earned an average of $41,800 per exahash per second (EH/s) from daily block rewards, marking a 1% drop compared to September.