On November 8, 2023, Marathon Digital Holdings Inc (MARA, Financial), a prominent player in the Bitcoin ecosystem, released its financial results for the third quarter ended September 30, 2023. The company reported a remarkable turnaround, posting a net income of $64.1 million, or $0.35 per diluted share, compared to a net loss of $72.5 million, or $0.62 loss per share, in the third quarter of the previous year. This performance reflects a significant improvement in the company's profitability and operational efficiency.
Financial Highlights
Marathon Digital Holdings Inc (MARA, Financial) experienced a substantial increase in revenues, which reached $97.8 million for the quarter, compared to $12.7 million in the third quarter of 2022. This increase was primarily attributed to a 467% surge in Bitcoin production and a 32% rise in average Bitcoin prices over the same period.
The company also reported gains on digital assets amounting to $31.7 million, as it sold 66% of the Bitcoin produced during the quarter to cover operating costs. However, these gains were partially offset by a higher impairment in the carrying value of digital assets, which stood at $11.9 million versus $1.4 million in the prior-year period. Additionally, the quarter benefited from a one-time gain of $82.6 million from the extinguishment of debt.
Adjusted EBITDA for the quarter was a positive $43.7 million, a stark contrast to the loss of $6.1 million in the third quarter of 2022. This improvement was largely due to an increase in total margin, excluding depreciation and amortization, which improved to $38.2 million from a loss of $1.1 million in the year-ago period.
Operational Achievements
Marathon Digital Holdings Inc (MARA, Financial) made significant strides in its operational capabilities during the quarter. The company's energized hash rate grew by 8% quarter-over-quarter to 19.1 exahashes, and its U.S. average operational hash rate increased by 18% from the last quarter to 14.2 exahashes. The company also energized its first joint venture and its first international location in the UAE, with a new joint venture in Paraguay on the horizon.
Strategic Financial Management
CEO Fred Thiel commented on the company's strategic financial management, stating,
In preparation for next year’s halving, we took proactive measures to strengthen our financial position during the quarter. The $417 million note exchange completed in September reduced our long-term debt by 56% and captured a total of approximately $101 million in cash savings for our shareholders."This move has positioned the company with combined cash and Bitcoin holdings exceeding its debt at the quarter's end.
Looking forward, Marathon Digital Holdings Inc (MARA, Financial) anticipates reaching 26 exahashes by the end of 2023 and expects to grow its hash rate by approximately 30% in 2024, further solidifying its position as a leading and energy-efficient Bitcoin mining operation.
Investors and interested parties were invited to a webcast and conference call on November 8, 2023, to discuss the financial results in detail. Marathon Digital Holdings Inc (MARA, Financial) continues to focus on supporting and securing the Bitcoin ecosystem, aiming to become one of the largest and most sustainably powered Bitcoin mining operations in North America.
For a more detailed analysis and information on Marathon Digital Holdings Inc (MARA, Financial)'s third quarter 2023 financial results, please visit GuruFocus.com.
Explore the complete 8-K earnings release (here) from Marathon Digital Holdings Inc for further details.
