In This Article:
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Cleanspark Inc (NASDAQ:CLSK) reported a 12% quarter-over-quarter revenue increase and a 62.5% increase compared to the same period last year.
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The company achieved a gross margin of 53%, demonstrating strong operational efficiency.
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Cleanspark Inc (NASDAQ:CLSK) has a total liquidity position of over $1 billion, providing financial flexibility.
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The company has strategically shifted from a near 100% hodl strategy to using a portion of Bitcoin production to support operations, avoiding equity dilution.
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Cleanspark Inc (NASDAQ:CLSK) has secured infrastructure to support growth beyond 60 exahash, positioning it well for future expansion.
Negative Points
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Cleanspark Inc (NASDAQ:CLSK) reported a net loss of $138.8 million, primarily due to a decrease in Bitcoin's market value.
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The marginal cost per Bitcoin increased by 26% over the first quarter, driven by rising power prices and mining difficulty.
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The company faces challenges from rising energy prices and increasing mining difficulty, impacting operational costs.
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Cleanspark Inc (NASDAQ:CLSK) has a total debt of $647.2 million, which could pose financial risks if not managed carefully.
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The company is exposed to potential tariff risks, although it has taken steps to mitigate these through proactive procurement.
Q & A Highlights
Q: Can you provide your outlook for the growth in the network hash rate in 2025 and CleanSpark's market share within that context? A: (Zach Bradford, CEO) We are seeing a plateau effect with some growth in the network hash rate, likely due to natural upgrade cycles. CleanSpark currently holds about 5% market share, and we aim to maintain and grow this share. We believe we are well-positioned to do so, considering global movements and market conditions.
Q: How do you envision the digital asset management team generating shareholder value over time, and how does your treasury approach differentiate you from peers? A: (Gary Vaccarelli, CFO) We have selected top counterparties and are exploring strategies like covered calls. For example, with Bitcoin trading around $101,000, issuing covered calls at the money could yield a premium of over $2,400, or 2.4% weekly, which annualizes to 97%. This strategy allows us to stay ahead of spot prices and generate cash for operational expenses, debt reduction, or reinvestment.
Q: Has the slowdown in buying from larger competitors impacted the pricing of mining rigs? A: (Zach Bradford, CEO) Yes, the slowdown has created opportunities for us to acquire rigs at lower costs. We recently completed a transaction with a 15% discount on already competitive pricing. We expect further price improvements as the market adjusts to reduced demand and potential tariff impacts.