Aug 31, 2026 earnings call — Mining scale-back and AI commercialization
Reported total revenue of $50.8 million and said it signed its first AI customer after quarter end.
Revenue $0.1B (est $0.1B) · EPS $-1.99 (est $-0.90)
Key quotes
"This quarter, we continued to actively rightsize our mining operations, disposing of machines with lower marginal efficiency and introduced a leasing model to shift our focus from scale to economics."
"On the AI side, since the end of the second quarter, we have made real progress on infrastructure and signed our first customer contract, moving that business from build-out into commercialization."
"In terms of the hedging program, it's structured as a short-term loan denominated in BTC."
Analyst Q&A 2
Bitcoin hedge and AI revenue timing
Q (Pingyue Wu · Citic): The analyst asked for details of the Bitcoin hedging program: overall notional size, instrument structure, duration, and whether it is risk mitigating or directional. He also asked why AI infrastructure updates were included now, if they belonged to Q2, whether they will materially boost Q3 results, and for revenue timing from newly signed customer contracts.
A: Management said the hedge is a short-term loan denominated in BTC, shown on the balance sheet as short-term debt of around USD 8 million with a roughly equivalent current asset; they size it to mining production (for example 1 month of production or 2 months) and sell it at spot on day 1, repaying with mined BTC if prices fall. They emphasized the program is purely a risk management tool to reduce cash flow sensitivity to Bitcoin price. On AI, they said the work fell after June 30 so Q2 revenue does not include it, only immaterial capitalized property costs in Q2, and they expect AI-related revenue to begin in the third quarter with an initial, modest contribution.
"And again, I would like to emphasize that we purely think of this as a risk management tool and the purpose is really just to reduce the sensitivity of our cash flow to the Bitcoin price ranges." — Ming Yeung Tang (CFO)
Q3 mining, machine types, costs, AI conversion
Q (Siddharth Rajeev · Fundamental Research Corp.): The analyst asked if Q3 mining revenue will stabilize or face further hashrate reductions and asked the split between S19 and newer machines. He also asked about cash cost trends and whether costs can be cut further, and how much mining infrastructure could be converted to AI over the next 3 years.
A: They said operational hashrate and the mining machines on the balance sheet will not change significantly in the third quarter, but summer months (July and August) may see regional power curtailment. The share of newer 21 series machines is increasing and, excluding leased machines, the split is roughly a little bit above 1/3 in the 21 series; cash costs fell in Q2 as they negotiated with hosted sites and used power-price reduction mechanisms tied to Bitcoin, so month-by-month cash cost trended downward. On AI conversion, they are focused on their own 50-megawatt Georgia site and have started installing small test nodes at other (partner) sites.
"In terms of the operational hashrate and the mining machines that we have on our balance sheet, in the third quarter, it would not change significantly -- it will not change significantly." — Ming Yeung Tang (CFO)