Hut 8 Corp.
02/25/2026 | Press release | Distributed by Public on 02/25/2026 05:37
Annual Report for Fiscal Year Ending 12-31, 2025 (Form 10-K)
Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read together with our consolidated financial statements and the related notes and the other financial information included elsewhere in this Annual Report. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual business, financial condition, and results of operations could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed below and elsewhere in this Annual Report, particularly under "Item 1A. Risk Factors." See also "Cautionary Statement Regarding Forward-Looking Statements." Our historical results are not necessarily indicative of the results that may be expected for any period in the future.
Business Overview
Hut 8 is an energy infrastructure platform that integrates power, digital infrastructure, and compute at scale to fuel next-generation, energy-intensive use cases. We take a power-first, innovation-driven approach to developing, commercializing, and operating the critical infrastructure that underpins the breakthrough technologies of today and tomorrow. As of December 31, 2025, our platform spanned 1,020 megawatts of energy capacity under management across 15 sites in the United States and Canada: five ASIC compute, hosting, and managed services sites in Alberta, New York, and Texas, five cloud and colocation data centers in British Columbia and Ontario, four power generation assets in Ontario, and one non-operational site in Alberta; 330 megawatts of energy under construction at one site in Louisiana; 1,230 megawatts of energy capacity under development across three sites in Texas and Illinois; 1,755 megawatts of energy capacity under exclusivity; and 5,185 megawatts of energy capacity under diligence. Of this capacity, approximately 310 megawatts is associated with the four power generation assets we divested in Q1 2026.
2025 Highlights
| ● | AI Infrastructure Partnership and River Bend Transaction. In December 2025, we announced a strategic partnership with Anthropic, PBC ("Anthropic") and Fluidstack Ltd. ("Fluidstack") to develop AI data center infrastructure. As part of the partnership, we entered into a 15-year, triple-net lease with Fluidstack for 245 MW of AI data center IT capacity at our River Bend campus ("River Bend") in Louisiana. The agreement grants Fluidstack a Right of First Offer for up to an additional 1,000 MW of IT capacity at future expansion phases of campus, subject to the expansion of power at the site. The initial data hall at River Bend is scheduled for completion and commissioning in Q2 2027, with additional data halls scheduled to come online over the balance of 2027. The lease has a base contract value of approximately $7.0 billion, with the potential to increase to $17.7 billion through renewal options, and is supported by a financial backstop from Google, which covers the lease payments and related pass-through obligations for the initial 15-year base term of the lease. As part of the partnership, Hut 8 and Anthropic may jointly diligence and develop up to 1,050 MW of additional optional capacity across our broader pipeline for a total of up to 2,295 MW of AI data center infrastructure, reflecting our power-first development model and strategic focus on scaling AI infrastructure. The initial phase of the partnership is supported by blue-chip institutional counterparties, including Entergy, which will be providing power to the site, J.P. Morgan and Goldman Sachs, who are expected to serve as loan underwriters for the project-level financing, Vertiv, who is the power provider for the site, and Jacobs, who is serving as general contractor. |
| ● | Far North Capacity Contract Awards and the Subsequent Sale.In November 2025, we entered into a definitive agreement to sell our 310 MW portfolio of four natural gas-fired power plants in Ontario, Canada to TransAlta Corporation ("TransAlta"). The transaction closed on February 2, 2026, concluding a multi-phase program in which we stabilized and strengthened the assets following their acquisition out of bankruptcy. Prior to the sale, we secured five-year capacity contracts with the Ontario Independent Electricity System Operator ("IESO") Medium-Term 2 ("MT2") auction across the portfolio, transitioning the assets from short-term arrangements to long-term revenue commitments. |
| ● | Two Prime Loan. On August 25, 2025, we entered into a credit agreement with Two Prime Lending Limited (the "Two Prime Credit Agreement"). The Two Prime Credit Agreement provides for a revolving credit facility of up to $200 million. Amounts borrowed under the Two Prime Credit Agreement bear interest at a fixed rate equal to 7.99% per annum. The facility matures 364 days after the date of the first borrowing (the "Maturity Date"). We may prepay any outstanding amounts borrowed, in whole or in part, without premium or penalty, at any time prior to the Maturity Date. Amounts prepaid may be reborrowed, in whole or in part, at any time prior to the Maturity Date. On or prior to a drawdown, we are required to pledge, as collateral, Bitcoin with a custodian, to be held in a segregated custody account under our ownership, such that the initial margin ratio of principal outstanding amount of the loan and the fair value of collateral is equal to or greater than 160%. If the value of the collateral under the credit facility decreases past a specified margin, we may be required to post additional Bitcoin as collateral. As of December 31, 2025, we have not borrowed any amount under the Two Prime Credit Agreement. |
| ● | Launch of Hut 8 2025 At-The-Market Offering Program. On August 22, 2025, we established a $1.0 billion at-the-market equity program (the "2025 ATM"), which replaced our prior $500 million at-the-market equity program launched on December 4, 2024 (the "2024 ATM"). As of August 22, 2025, prior to its termination, we had issued and sold shares under the 2024 ATM for gross proceeds of $299.4 million at a weighted average price of $27.83 per share. For reference, our average share price from commencement of the 2024 ATM until August 22, 2025 was $18.61 per share. As of December 31, 2025, we had issued and sold 4,020,630 shares under the 2025 ATM for gross proceeds of $183.4 million at a weighted average issuance price of $45.62 per share. |
| ● | Coinbase Loan.On June 16, 2025, we entered into a Third Amended and Restated Credit Agreement with Coinbase Credit, Inc. ("Coinbase") to, among other things, amend and expand our Bitcoin-backed credit facility from $65.0 million to up to $130.0 million, and extend the maturity date to June 16, 2026. Additionally, the interest rate structure was converted to a fixed interest rate of 9.0%, compared to a variable rate interest rate that was at 10.5% as of December 31, 2024. On December 22, 2025, we entered into a Fourth Amended and Restated Credit Agreement ("Credit Agreement") with Coinbase primarily to increase the principal amount by up to $70.0 million of additional borrowings, if any, resulting in a total principal amount of up to $200.0 million. As of December 31, 2025, we have borrowed the full $200.0 million under the Credit Agreement. |
| ● | Energization of Vega Facility. In June 2025, we completed the initial energization of our Vega facility in the panhandle of Texas. The single-building facility, spanning 162,000 square feet, is powered by 205 MW of nameplate capacity behind-the-meter by a wind farm and front-of-the-meter by the ERCOT grid. At full energization, Vega supports up to approximately 15 exahash per second ("EH/s") of direct-to-chip-liquid-cooled BITMAIN U3S21EXPH servers for ASIC compute. The facility was originally contracted with Bitmain and was subsequently transitioned to American Bitcoin. |
| ● | Miner Fleet Upgrade.We completed the deployment of new-generation ASIC miners across our Salt Creek and Medicine Hat facilities on April 4, 2025. These upgrades contributed to a significant increase in deployed hashrate from approximately 5.6EH/s to 9.3EH/s and an improvement in average fleet efficiency from approximately 31.7 J/TH to 20 J/TH. These miners were contributed to American Bitcoin as part of the launch of American Bitcoin discussed below. |
| ● | Launch and Go-Public Transaction of American Bitcoin. In March 2025, we launched American Bitcoin, a majority-owned subsidiary formed following the strategic contribution of substantially all of our ASIC miners in exchange for a majority ownership interest in American Data Centers Inc. In June 2025, American Bitcoin issued and sold 11,002,954 shares of its Class A common stock for aggregate gross proceeds in cash and Bitcoin of $220.1 million, and aggregate net proceeds of approximately $215.3 million after deducting certain fees and expenses incurred in connection with the issuance, including aggregate issuance cost of $4.8 million. On September 3, 2025, American Bitcoin began its trading on the Nasdaq Stock Market ("Nasdaq") following the completion of its merger with Gryphon Digital Mining, Inc. ("Gryphon") in which Gryphon acquired American Bitcoin in a stock-for-stock merger transaction (the "ABTC Merger"). At the closing of the ABTC Merger, the issued and outstanding capital stock of American Bitcoin was canceled and converted into newly issued stock representing, in the aggregate, approximately 98% of the issued and outstanding stock of Gryphon. Upon the completion of the ABTC Merger, Gryphon was renamed "American Bitcoin Corp." and began trading on Nasdaq under the ticker symbol "ABTC." Immediately following the completion of the ABTC Merger, we beneficially owned a majority of the voting interest of the combined company. Following the ABTC Merger, we have continued to serve as American Bitcoin's exclusive infrastructure and operations partner through a series of long-term commercial agreements that generate stable, contracted revenue streams in our Power and Digital Infrastructure segments. However, as American Bitcoin is a consolidated subsidiary, all fees under our commercial agreements are eliminated in consolidation. |
Key Factors Affecting Our Performance
Power constraints
Access to energy is a key factor affecting our ability to meet growing demand for HPC, AI, and ASIC compute and to scale our digital infrastructure platform. Power is the foundation of our operations. We acquire, develop, and manage critical energy assets such as interconnects, powered land, and other electrical infrastructure to address the load demands of energy-intensive applications. As competition for power intensifies, our performance depends on originating, commercializing, and optimizing energy capacity at scale. We believe our experience in power origination, infrastructure design, and load optimization positions us to manage these constraints and support continued growth. Our portfolio currently provides access to competitively priced electrical power in the regions where we operate; however, there is no guarantee that we will be able to procure additional power on similar terms, or at all. Market prices for power, capacity, and ancillary services are unpredictable and tend to fluctuate substantially. See "Risk Factors-Risks Related to Our Business and Operations-We are subject to risks associated with our need for significant electrical power" in the Annual Report.
Expansion into AI infrastructure services and other energy-intensive use cases
A key factor affecting our performance is our ability to expand into AI infrastructure services and other energy-intensive use cases. We are leveraging our existing development and operational expertise to develop data centers that support specialized workloads for enterprise and hyperscale customers and other next-generation, energy-intensive use cases. Success in this area depends on various factors, including our ability to develop future sites, secure and retain customers, manage capital efficiently, and compete effectively in emerging technology markets. While this expansion may increase operating and capital costs and expose us to execution and market risks, management believes our experience in power origination, development, and management in large-scale digital infrastructure development position us to capture long-term growth opportunities in the evolving AI sector and other next-generation, energy-intensive use cases.
Price of Bitcoin
While we are migrating towards less volatile, lower cost-of-capital businesses, such as data centers, our current business remains heavily dependent on the price of Bitcoin, which has historically experienced significant volatility. Our exposure is driven primarily by the Bitcoin held on our consolidated balance sheet, including Bitcoin held directly by us and American Bitcoin in our respective strategic reserves. In addition, our consolidated results reflect American Bitcoin's activities as a Bitcoin accumulation platform and its strategy of purchasing and holding Bitcoin. Lastly, we generate revenue from Bitcoin rewards that are earned through mining operations at our facilities, the majority of which are conducted through American Bitcoin.
Under ASU 2023-08, Intangibles-Goodwill and Other-Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets ("ASU 2023-08"), Bitcoin is revalued at fair value at the end of each reporting period, with changes in fair value recognized in net income. As a result, fluctuations in the price of Bitcoin may significantly impact our results of operations.
Bitcoin network difficulty and hashrate
Our business is not only impacted by the volatility in Bitcoin prices, but also by increases in the competition for Bitcoin production, specifically for ASIC compute. This increased competition is described as the network hashrate resulting from the growth in the overall quantity and quality of miners working to solve blocks on the Bitcoin blockchain, and the difficulty index associated with the secure hashing algorithm employed in solving the blocks. Increased difficulty reduces the mining proceeds of the equipment proportionally and eventually requires Bitcoin miners like American Bitcoin, to upgrade their equipment to remain profitable and compete effectively with other miners. Conversely, a decline in network hashrate results in a decrease in difficulty, increasing mining proceeds and profitability.
Block reward and halving
The current Bitcoin reward for solving a block is 3.125 Bitcoin. The Bitcoin network is programmed such that the Bitcoin block reward is halved every 210,000 blocks mined, or approximately every four years. This reduction in reward spreads out the release of Bitcoin over a long period of time as fewer Bitcoin are mined with each halving event. Bitcoin halving events impact the number of Bitcoin that we mine, including through American Bitcoin which, in turn, may have a potential impact on our results of operations. The last halving event occurred in April 2024, and the next halving event is expected to occur in 2028.
Key Performance Indicators
In addition to our financial results and generally accepted accounting principles in the United States of America ("GAAP") financial measures, we use certain key performance indicators to evaluate our business, identify trends, and make strategic decisions. Certain Key Performance Indicators for the prior period were reclassified to align with updated definitions.
The following table presents our key performance indicators as of December 31, 2025 and 2024.
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As of |
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December 31, |
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2025 |
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2024 |
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Energy Capacity Under Diligence |
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5,185 MW |
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8,599 MW |
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Energy Capacity Under Exclusivity |
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1,755 MW |
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2,768 MW |
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Energy Capacity Under Development |
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1,230 MW |
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- MW |
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Energy Capacity Under Construction |
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330 MW |
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205 MW |
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Energy Capacity Under Management |
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1,020 MW |
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815 MW |
Energy Capacity Under Diligence
Energy Capacity Under Diligence represents sites identified for large-load use cases such as AI, HPC, ASIC compute, industrial applications such as next generation manufacturing, and other energy-intensive technologies. At this stage, we assess site potential by engaging with utilities, landowners, power generators, local, state and regulatory bodies, and other stakeholders to evaluate critical factors, including power availability, infrastructure readiness, fiber connectivity, and overall commercial viability. This metric allows management to better understand our potential opportunities, allowing us to remain selective in our investment decisions while positioning us to respond to market demand signals and emerging opportunities. Energy Capacity Under Diligence as of December 31, 2025, was 5,185 MW compared to 8,599 MW as of December 31, 2024. The net decrease reflects both the advancement of certain sites into other development categories and the removal of sites that no longer met our strategic, commercial, infrastructure, or regulatory criteria.
Energy Capacity Under Exclusivity
Energy Capacity Under Exclusivity represents sites where we have secured a clear path to ownership through either: (i) an exclusivity agreement that prevents the sale of designated land and power capacity to another party or (ii) a tendered interconnection agreement, confirming a viable path to securing power and infrastructure for deployment. Management monitors Energy Capacity Under Exclusivity to evaluate potential near-term opportunities prior to making additional investment commitments. Energy Capacity Under Exclusivity as of December 31, 2025 was 1,755 MW compared to 2,768 MW as of December 31, 2024. The net decrease reflects both the advancement of certain sites into other development categories and the removal of sites that no longer met our strategic, commercial, infrastructure, or regulatory criteria.
Energy Capacity Under Development
Energy Capacity Under Development represents sites where we are actively investing in development and commercialization by executing definitive land and/or power agreements, advancing site design and infrastructure buildout, and engaging with prospective customers. This phase is monitored by management as it represents the projects that are closest to commencing construction. Energy Capacity Under Development as of December 31, 2025 was 1,230 MW compared to 0 MW as of December 31, 2024. The growth was driven by an increase of 1,230 MW in capacity advancing from exclusivity to development, including two sites in Texas totaling 1,180 MW, and one site in Illinois of 50 MW.
Energy Capacity Under Construction
Energy Capacity Under Construction represents sites where we have executed a definitive offtake or other commercial agreements and commenced construction activities. This stage includes oversight of contractors, equipment delivery, and commissioning schedules to ensure projects are completed safely, on time, and within budget. Progress at this stage is closely monitored to manage capital deployment and align project delivery with customer timelines and market demand. Energy capacity under construction as of December 31, 2025 was 330 MW related to the River Bend site compared to 205 MW as of December 31, 2024, related to the Vega site which was energized and moved to Energy Capacity Under Management in June 2025.
Energy Capacity Under Management
Energy Capacity Under Management comprises all Power assets: Power Generation, Managed Services, ASIC infrastructure, CPU infrastructure, ASIC Compute, Traditional Cloud, and non-operational sites. Management reviews this metric to assess total energy capacity utilization across our operations to drive an efficient allocation of resources. Energy Capacity Under Management as of December 31, 2025 was 1,020 MW, compared to 815 MW as of December 31, 2024. The increase reflects the energization of our 205 MW Vega site in June 2025. Subsequent to year-end, we completed the sale of four power generation facilities in Ontario totaling 310 MW, which will reduce Energy Capacity Under Management in future periods.
Non-GAAP Financial Measures
In addition to our results determined in accordance with GAAP, we rely on Adjusted EBITDA to evaluate our business, measure our performance, and make strategic decisions. Adjusted EBITDA is a non-GAAP financial measure. We define Adjusted EBITDA as net loss or income, adjusted for impacts of interest expense, income tax benefit or provision, depreciation and amortization, our share of unconsolidated joint venture depreciation and amortization, net of basis adjustments, foreign exchange gain or loss, loss or gain on sale of property and equipment, gain on debt extinguishment, gain on derivatives, gain on other financial liability, gain on warrant liability, gain on bargain purchase, the removal of non-recurring transactions, asset contribution costs, impairment charges, loss from discontinued operations, net of taxes, loss attributable to non-controlling interests, and stock-based compensation expense in the period presented. You are encouraged to evaluate each of these adjustments and the reasons our Board and management team consider them appropriate for supplemental analysis.
Our board of directors and management team use Adjusted EBITDA to assess our financial performance because it allows them to compare our operating performance on a consistent basis across periods by removing the effects of our capital structure (such as varying levels of interest expense and income), asset base (such as depreciation and amortization), and other items (such as non-recurring transactions mentioned above) that impact the comparability of financial results from period to period.
Net (loss) income is the GAAP measure most directly comparable to Adjusted EBITDA. In evaluating Adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in such presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. There can be no assurance that we will not modify the presentation of Adjusted EBITDA in the future, and any such modification may be material. Adjusted EBITDA has important limitations as an analytical tool and you should not consider Adjusted EBITDA in isolation or as a substitute for analysis of our results as reported under GAAP. Because Adjusted EBITDA may be defined differently by other companies in our industry, our definition of this non-GAAP financial measure may not be comparable to similarly titled measures of other companies, thereby diminishing its utility.
For a reconciliation to our most directly comparable financial measure calculated and presented in accordance with GAAP, please see "-Results of Operations" below.
Business Segments
We have four reportable business segments: Power, Digital Infrastructure, Compute, and Other.
Power
The Power business segment consists of Power Generation and Managed Services.
Power Generation
We generate revenue from our 80.1% interest in a joint venture with Macquarie Group Limited ("Macquarie"), a global financial services and infrastructure investment firm, which provides capacity and energy to the electrical grid through four natural gas power plants in Ontario, Canada (the "Far North JV"). The power generation facilities were acquired in February 2024 and are connected to the IESO, which operates Ontario's power grid. The power generation assets primarily generate revenue from capacity payments and electricity sales, both of which are variable and depend on several factors, including generation capacity in the market, the supply and demand for electricity, and the prevailing price of natural gas.
In June 2025, all four of the power plants were awarded five-year capacity contracts with IESO. The contracts were awarded to the Far North JV following successful bids submitted into the competitive IESO MT2 capacity auction and will commence on May 1, 2026.
In November 2025, Hut 8 announced the sale of the Far North JV to TransAlta following the successful optimization and long-term contract wins. The transaction closed on February 2, 2026.
Managed Services
Our Managed Services business provides institutional partners with an end-to-end partnership model for energy infrastructure development, including:
| ● | Project inception: site design, procurement, and construction management; |
| ● | Project operationalization: software automation, process design, personnel hiring, and team training; |
| ● | Revenue management: utilities contracts, hosting operations, and customer management; |
| ● | Project optimization: energy portfolio optimization and strategic initiatives; and/or |
| ● | Compliance and reporting: finance, accounting, and safety. |
Cash flows in our Managed Services business are generated through a fee structure that is typically fixed based on power capacity under management, with reimbursement of passthrough costs. In addition to the fixed fee, under certain agreements, further cash flows may be driven from incentive bonuses and certain energy management services.
As of December 31, 2025, we managed 280 MW of energy capacity under this program at one site in the United States owned by the King Mountain JV.
Starting April 1, 2025, we began operating as the exclusive provider of managed services to American Bitcoin via the execution of a Master Managed Services Agreement ("MSA"). Under the MSA, we provide American Bitcoin with management, oversight, strategy, compliance, operational, and other services for American Bitcoin's mining operations. These operations are colocated at our facilities and include 205 MW of energy capacity under management currently deployed at our Vega site. The fee structure typically consists of (i) a fixed fee of $1.250/kW-month based on the power capacity of each facility, as well as (ii) designated site level reimbursements. As American Bitcoin is a consolidated subsidiary, all fees under the MSA are eliminated in consolidation.
Digital Infrastructure
Under our ASIC infrastructure business, we enter into contracts to host and operate mining equipment on behalf of third parties within our facilities. These services include the provision, if applicable, and hosting of mining equipment as well as the monitoring, troubleshooting, repair, and maintenance of such equipment. Revenues from ASIC infrastructure services are generated through fees that may be fixed or based on profit-sharing arrangements, often with reimbursement for certain pass-through costs, such as electricity.
During the fourth quarter of 2024, our agreement with Ionic Digital Inc. ("Ionic") to host approximately 8,500 miners (0.8 EH/s) at our Alpha site was terminated. As a result, we ceased providing ASIC infrastructure services at Alpha and utilized the site solely for self-mining purposes.
Starting April 1, 2025, we began operating as the exclusive provider of ASIC infrastructure services to American Bitcoin via the execution of a Master Colocation Services Agreement ("CSA"). Under the CSA, we provide ASIC infrastructure services for American Bitcoin's miners at our facilities. The fee structure typically includes (i) a fixed monthly fee that targets a 25% yield on cost of each facility as of the start of the specific service order under the CSA, subject to an annual increase, as well as (ii) infrastructure-related site level reimbursements. As American Bitcoin is a consolidated subsidiary, all fees under the CSA are eliminated in consolidation.
During 2024, we entered into an ASIC colocation contract with Bitmain Technologies Georgia Limited ("Bitmain") to host miners at our Vega site. The agreement featured a fixed hosting fee with an option for us to purchase all or a portion of the hosted machines in up to three tranches at a fixed price within six months of energization of the relevant tranches. We completed energization of the miners during June and July 2025. In August 2025, pursuant to our Put Option Agreement with American Bitcoin entered into on March 31, 2025 (the "Put Option Agreement"), we assigned our option to purchase the hosted machines to American Bitcoin. In August 2025, American Bitcoin exercised this option to purchase all of the Bitmain miners hosted at the Vega site, where we then began to provide ASIC infrastructure services to American Bitcoin under the CSA.
Through our Hut 8 Canada business, we provide data center and cloud infrastructure services, including colocation solutions, supported by approximately 3 MW of energy capacity and more than 36,000 square feet of geo-diverse data center space across five locations in Canada. These services support customers operating compute, storage, and network workloads across traditional enterprise, B2B, machine learning, visual effects, and AI. Our CPU infrastructure offering is delivered in Mississauga, Ontario; Vaughan, Ontario; Kelowna, British Columbia; and two locations in Vancouver, British Columbia. The facilities are powered predominately by emission-free energy sources. This segment serves computing needs unrelated to ASIC Compute. These data centers are carrier neutral with network diversity and redundancy from multiple telecommunications providers.
Our CPU infrastructure business is based on a fixed-fee model. Customers pay a fixed recurring monthly fee based on a set amount of resources assigned.
We are expanding our Digital Infrastructure platform to support AI and other high-performance computing workloads through purpose-built data centers, beginning with the development of our River Bend campus in Louisiana.
Compute
Our Compute segment comprises operating businesses that deploy and monetize compute assets across next-generation energy-intensive technology end markets. We generate revenue through the operation of owned compute infrastructure and the provision of compute-based services, with economics driven by hardware utilization, operating efficiency, and market demand. The Compute business segment consists of ASIC Compute, Traditional Cloud, and AI Cloud.
ASIC Compute
The ASIC Compute segment reflects revenue generated primarily by American Bitcoin.
Our ASIC Compute business spanned five sites as of December 31, 2025, which are occupied by American Bitcoin miners and hosted at facilities supported by our ASIC Infrastructure:
| ● | four sites with facilities we own and/or lease, and operate: (1) Alpha (Niagara Falls, New York), (2) Medicine Hat (Medicine Hat, Alberta), (3) Salt Creek (Orla, Texas), and (4) Vega (Amarillo, Texas); and |
| ● | one site that we own through a 50% joint venture, King Mountain (McCamey, Texas). |
Until April 30, 2024, we also had ASIC Compute operations hosted at sites in Kearney, Nebraska and Granbury, Texas. We previously mined Bitcoin at a site in Drumheller, Alberta, which has been non-operational since March 2024 due to lack of profitability driven primarily by elevated energy costs and underlying voltage issues.
Bitcoin rewards are received from mining activity through third-party mining pool operators, which allow miners to combine their processing power, increasing their chances of solving a block and getting paid by the network. We provide computing power to mining pools, which use this computing power to operate nodes and validate blocks on the blockchain. The pools then distribute our pro-rata share of Bitcoin mined to us based on the computing power we contribute.
During February and March 2025, our mining activity was reduced due to a planned fleet upgrade, which was completed on April 4, 2025. The fleet upgrade resulted in higher efficiency Antminer S21+ miners at our Salt Creek and Medicine Hat sites, which improved ASIC Compute operations.
On March 31, 2025, we launched American Bitcoin. Beginning April 1, 2025, ASIC Compute operations previously reported under our Compute segment remain under this segment but operate generally through our majority-owned subsidiary, American Bitcoin.
On August 5, 2025, pursuant to the Put Option Agreement, we assigned our option to purchase up to approximately 17,280 Bitmain Antminer U3S21EXPH ASIC miners (collectively, the "Bitmain Miners"), representing a total of approximately 14.86 EH/s, to American Bitcoin. American Bitcoin exercised the option on August 5, 2025 and entered into an On-Rack Sales and Purchase Agreement (the "ABTC Bitmain Purchase Agreement") with Bitmain to purchase the Bitmain Miners in one or more tranches for a total purchase price of up to approximately $320.0 million, not including any applicable tariffs, duties or similar charges.
Concurrently with the execution of the ABTC Bitmain Purchase Agreement, American Bitcoin purchased 16,299 of the Bitmain Miners, representing a total of approximately 14.02 EH/s, for a total purchase price of approximately $314 million, paid through the pledge of Bitcoin at a mutually agreed upon fixed price. Such purchase price was reduced by the application of a deposit and certain expenses of approximately $46.0 million we previously paid to Bitmain. American Bitcoin repaid the $46 million in October 2025, pursuant a pledge of additional Bitcoin to Bitmain at a mutually agreed upon fixed price, where upon Bitmain refunded the $46.0 million comprising of the deposit and certain expenses to us satisfying American Bitcoin's repayment obligation. In September 2025, American Bitcoin purchased the remaining 981 Bitmain Miners for a total purchase price of $18.9 million, also paid through the pledge of Bitcoin at a mutually agreed upon fixed price. The Bitcoin pledged under the ABTC Bitmain Purchase Agreement has a redemption period of approximately 24 months from each pledge date.
Traditional Cloud
Our Traditional Cloud segment reflects revenue generated by Hut 8 Canada. Traditional Cloud services support both public and private cloud deployments, managed backup, business continuity and disaster recovery services, and high-performance, high-capacity storage solutions at our five HPC locations across Canada. We employ a consumption-based fee structure where customers commit to a baseline level of compute, storage, network, or power usage as defined in their service agreements. Any usage beyond this baseline is typically billed incrementally, so costs are aligned with actual resource consumption and customers are afforded flexibility as their needs evolve.
AI Cloud
Our AI Cloud assets are deployed under our wholly owned subsidiary, Highrise AI, Inc., at a third-party colocation site near Chicago, Illinois. This segment generates recurring revenue through payments made by the provider to us based on fixed infrastructure payments and a revenue share tied to AI Cloud utilization.
Other
Our Other reporting segment includes activities that fall outside the scope of our Power, Digital Infrastructure, and Compute layers.
Equipment Sales and Repairs
We may sell mining equipment when profitable opportunities arise (e.g., if market prices exceed our procurement cost). We may also repair miners for third parties in exchange for a fee, as we have a fully equipped, MicroBT-certified repair center space at our Medicine Hat site.
Results of Operations
Twelve Months Ended December 31, 2025 and 2024
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Twelve Months Ended |
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December 31, |
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Increase |
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(in USD thousands) |
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2025 |
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2024 |
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(Decrease) |
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Revenue: |
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Power |
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$ |
23,212 |
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$ |
56,602 |
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$ |
(33,390) |
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Digital Infrastructure |
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9,577 |
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17,482 |
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(7,905) |
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Compute |
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202,329 |
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80,701 |
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121,628 |
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Other |
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- |
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7,600 |
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(7,600) |
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Total revenue |
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235,118 |
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162,385 |
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72,733 |
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Cost of revenue (exclusive of depreciation and amortization shown below): |
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Cost of revenue - Power |
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20,509 |
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21,538 |
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(1,029) |
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Cost of revenue - Digital Infrastructure |
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8,891 |
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15,556 |
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(6,665) |
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Cost of revenue - Compute |
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78,374 |
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44,977 |
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33,397 |
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Cost of revenue - Other |
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- |
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4,584 |
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(4,584) |
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Total cost of revenue |
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107,774 |
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86,655 |
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21,119 |
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|
|
|
|
|
|
|
|
|
|
|
Operating expenses (income): |
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
101,901 |
|
|
47,773 |
|
|
54,128 |
|
General and administrative expenses |
|
|
122,807 |
|
|
72,917 |
|
|
49,890 |
|
Loss (gain) on digital assets |
|
|
220,037 |
|
(509,337) |
|
|
729,374 |
|
|
Loss (gain) on sale of property and equipment |
|
|
4,593 |
|
(634) |
|
|
5,227 |
|
|
Impairment - other |
|
|
- |
|
|
4,472 |
|
|
(4,472) |
|
Total operating expense (income) |
|
|
449,338 |
|
|
(384,809) |
|
|
834,147 |
|
Operating (expense) income |
|
|
(321,994) |
|
|
460,539 |
|
|
(782,533) |
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
Foreign exchange gain (loss) |
|
|
3,396 |
|
|
(5,000) |
|
|
8,396 |
|
Interest expense |
|
|
(30,073) |
|
|
(29,794) |
|
|
(279) |
|
Asset contribution costs |
|
|
(22,780) |
|
|
- |
|
|
(22,780) |
|
Gain on debt extinguishment |
|
|
- |
|
|
5,966 |
|
|
(5,966) |
|
Gain on derivatives |
|
|
61,550 |
|
|
6,780 |
|
|
54,770 |
|
Gain on other financial liability |
|
|
956 |
|
|
- |
|
|
956 |
|
Gain on warrant liability |
|
|
384 |
|
|
- |
|
|
384 |
|
Gain on bargain purchase |
|
|
- |
|
|
3,060 |
|
|
(3,060) |
|
Equity in earnings of unconsolidated joint venture |
|
8,727 |
|
10,359 |
|
|
(1,632) |
||
|
Total other income (expense) |
|
22,160 |
|
(8,629) |
|
|
30,789 |
||
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) income from continuing operations before taxes |
|
|
(299,834) |
|
|
451,910 |
|
|
(751,744) |
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit (provision) |
|
|
51,836 |
|
|
(113,457) |
|
|
165,293 |
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income from continuing operations |
|
$ |
(247,998) |
|
$ |
338,453 |
|
$ |
(586,451) |
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations (net of income tax benefit of nil and $2.3 million, respectively) |
|
|
- |
|
|
(7,044) |
|
|
7,044 |
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
|
(247,998) |
|
|
331,409 |
|
|
(579,407) |
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net loss attributable to non-controlling interests |
|
|
21,849 |
|
|
473 |
|
|
21,376 |
|
Net (loss) income attributable to Hut 8 Corp. |
|
$ |
(226,149) |
|
$ |
331,882 |
|
$ |
(558,031) |
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(247,998) |
|
$ |
331,409 |
|
$ |
(579,407) |
|
Other comprehensive (loss) income: |
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustments |
|
|
35,173 |
|
|
(56,390) |
|
|
91,563 |
|
Total comprehensive (loss) income |
|
|
(212,825) |
|
|
275,019 |
|
|
(487,844) |
|
Less: Comprehensive income attributable to non-controlling interest |
|
|
21,797 |
|
|
549 |
|
|
21,248 |
|
Comprehensive (loss) income attributable to Hut 8 Corp. |
|
$ |
(191,028) |
|
$ |
275,568 |
|
$ |
(466,596) |
Adjusted EBITDA reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended |
|
|
|
||||
|
|
|
December 31, |
Increase |
||||||
|
(in USD thousands) |
|
2025 |
|
2024 |
|
(Decrease) |
|||
|
Net (loss) income |
|
$ |
(247,998) |
|
$ |
331,409 |
|
$ |
(579,407) |
|
Interest expense |
|
30,073 |
|
|
29,794 |
|
|
279 |
|
|
Income tax benefit (provision) |
|
(51,836) |
|
|
113,457 |
|
|
(165,293) |
|
|
Depreciation and amortization |
|
101,901 |
|
|
47,773 |
|
|
54,128 |
|
|
Share of unconsolidated joint venture depreciation, amortization, net of basis adjustments (1) |
|
17,641 |
|
|
21,792 |
|
|
(4,151) |
|
|
Foreign exchange (gain) loss |
|
|
(3,396) |
|
|
5,000 |
|
|
(8,396) |
|
Loss (gain) on sale of property and equipment |
|
|
4,593 |
|
|
(634) |
|
|
5,227 |
|
Gain on debt extinguishment |
|
|
- |
|
|
(5,966) |
|
|
5,966 |
|
Gain on derivatives |
|
|
(61,550) |
|
|
(6,780) |
|
|
(54,770) |
|
Gain on other financial liability |
|
|
(956) |
|
|
- |
|
|
(956) |
|
Gain on warrant liability |
|
|
(384) |
|
|
- |
|
|
(384) |
|
Gain on bargain purchase |
|
|
- |
|
|
(3,060) |
|
|
3,060 |
|
Non-recurring transactions (2) |
|
|
(7,432) |
|
|
(9,882) |
|
|
2,450 |
|
Asset contribution costs |
|
|
22,780 |
|
|
- |
|
|
22,780 |
|
Impairment - other |
|
|
- |
|
|
4,472 |
|
|
(4,472) |
|
Loss from discontinued operations (net of income tax benefit of nil and $2.3 million, respectively) |
|
|
- |
|
|
7,044 |
|
|
(7,044) |
|
Loss attributable to non-controlling interests |
|
|
3,410 |
|
|
473 |
|
|
2,937 |
|
Stock-based compensation expense |
|
57,801 |
|
|
20,783 |
|
|
37,018 |
|
|
Adjusted EBITDA |
|
$ |
(135,353) |
|
$ |
555,675 |
|
$ |
(691,028) |
|
(1) |
Net of the accretion of fair value differences of depreciable and amortizable assets included in equity in earnings of unconsolidated joint venturein the Consolidated Statements of Operations and Comprehensive Income (Loss) in accordance with ASC 323. See Note 11. Investment in unconsolidated joint ventureof the consolidated financial statements included elsewhere in this Annual Report for further detail. |
|
(2) |
Non-recurring transactions for the twelve months ended December 31, 2025 represent approximately $8.7 million of American Bitcoin-related transaction costs, $1.1 million of Far North transaction costs, and $0.4 million in restructuring costs, offset by a $17.6 million sales tax refund. Non-recurring transactions for the twelve months ended December 31, 2024 represent approximately $4.0 million of restructuring costs and $1.9 million related to the Far North transaction costs, offset by a $13.5 million contract termination fee received from MARA, and a $2.2 million tax refund. |
Revenue
Total revenue was $235.1 million and $162.4 million for the twelve months ended December 31, 2025, and 2024 respectively, and consisted of Power, Digital Infrastructure, Compute, and Other.
Power
Power revenue was $23.2 million and $56.6 million for the twelve months ended December 31, 2025 and 2024, respectively. This $33.4 million decrease was primarily driven by a $40.8 million decrease in Managed Services revenue due to the $13.5 million in contract termination fees received from MARA Holdings in the prior year period, as well as the termination of the managed services agreement with Ionic in December 2024. This decrease was partially offset by a $7.4 million increase in electricity sales through the Far North JV due to growth in electricity demand during 2025.We also generate intercompany revenue under the MSA between us and American Bitcoin, which is eliminated upon consolidation.
Digital Infrastructure
Digital Infrastructure revenue was $9.6 million and $17.5 million for the twelve months ended December 31, 2025 and 2024, respectively. This $7.9 million decrease was primarily driven by (i) a $7.6 million decrease in ASIC infrastructure revenue as a result of the termination of our colocation agreement with Ionic during the fourth quarter of 2024, and (ii) a $0.3 million decrease in CPU infrastructure revenue due to customer churn. We also generate intercompany revenue under the CSA between us and American Bitcoin, which is eliminated upon consolidation.
Compute
Compute revenue was $202.3 million and $80.7 million for the twelve months ended December 31, 2025 and 2024, respectively, representing an increase of $121.6 million year over year. This increase was primarily driven by (i) a $115.4 million increase in ASIC Compute revenue, largely attributable to an increase in the average revenue per Bitcoin mined from $60,436 to $103,647 and an increase in Bitcoin mined from 1,184 to 1,803. The increase in Bitcoin mined was primarily due to improved uptime following the fleet upgrade completed in April 2025 at the Salt Creek and Medicine Hat locations and the commencement of ASIC Compute revenue through American Bitcoin mining at the Vega site in August 2025, and (ii) a $7.4 million increase in revenues from our AI Cloud offering, driven by a full year of sales activity in 2025. These increases were partially offset by a $1.2 million decrease in Traditional Cloud revenue due to customer churn.
Other
Other revenue was nil and $7.6 million for the twelve months ended December 31, 2025 and 2024, respectively. This decrease was primarily driven by (i) a $7.4 million decrease in equipment sales revenue, and (ii) equipment repair services revenue that was lower by $0.2 million.
Cost of Revenue
Total cost of revenue was $107.8 million and $86.7 million for the twelve months ended December 31, 2025, and 2024, respectively, and consisted of Power, Digital Infrastructure, Compute, and Other.
Power
Power cost of revenue was $20.5 million and $21.5 million for the twelve months ended December 31, 2025 and 2024, respectively. This $1.0 million decrease was primarily driven by a $9.2 million decrease in cost of revenue related to the termination of the managed services agreement with Ionic in December 2024. This decrease was partially offset by a $8.2 million increase in cost of revenue related to electricity sales through the Far North JV due to growth in electricity demand during 2025.
Digital Infrastructure
Digital Infrastructure cost of revenue was $8.9 million and $15.6 million for the twelve months ended December 31, 2025 and 2024, respectively. This $6.7 million decrease was primarily driven by a $7.5 million decrease in ASIC infrastructure-related costs as a result of the termination of our colocation agreement with Ionic during the fourth quarter of 2024. This decrease was partially offset by a $0.8 million increase in cost of sales related to CPU infrastructure operations, including rent, electricity, and connectivity costs.
Compute
Compute cost of revenue was $78.4 million and $45.0 million for the twelve months ended December 31, 2025 and 2024, respectively. This $33.4 million increase was primarily driven by (i) a $32.2 million rise in ASIC Compute costs due to higher uptime as a result of the fleet upgrade that was completed in April 2025 at the Salt Creek and Medicine Hat sites, as well as the energization of the Vega site in June 2025, and (ii) a $2.2 million increase in costs related to AI Cloud offerings due to having a full year of activity in 2025. These increases were partially offset by a $1.1 million decrease in Traditional Cloud costs due to customer churn.
Other
Other cost of revenue was nil and $4.6 million for the twelve months ended December 31, 2025 and 2024, respectively. This $4.6 million decrease was primarily driven by (i) a $4.2 million decrease in equipment sales costs, and (ii) a $0.4 million decrease in costs related to our equipment repair services.
Depreciation and amortization
Depreciation and amortization expense was $101.9 million and $47.8 million for the twelve months ended December 31, 2025 and 2024, respectively. This $54.1 million increase was primarily driven by (i) a $35.5 million increase in depreciation of American Bitcoin's ASIC miners as a result of the fleet upgrade that was completed in April 2025 at our Salt Creek and Medicine Hat sites, as well as American Bitcoin's purchase of the Bitmain Miners at the Vega site in August 2025, (ii) an $11.5 million increase in depreciation of our mining infrastructure and related machinery and equipment related to the construction and energization of our Vega site in June 2025, and (iii) a $6.6 million increase in depreciation of our AI GPUs primarily related to a full year of ownership in 2025 compared to only a partial year in 2024.
General and administrative expenses
General and administrative ("G&A") expenses were $122.8 million and $72.9 million for the twelve months ended December 31, 2025, and 2024, respectively. This $49.9 million uptick in G&A expenses was primarily driven by (i) a $37.0 increase in share based payments, (ii) an $11.2 million growth in salary and benefit expenses due to added headcount to support our growth initiatives, (iii) a $9.5 million increase in transaction costs related to the ABTC Merger, and (iv) a $6.5 million increase in general, marketing, travel, and other expenses in line with the rise in headcount to support our growth initiatives. These increases were partially offset by a $17.8 million decrease in sales tax expenses as we received a $17.8 million sales tax refund in Canada in December 2025 related to sales taxes paid in 2024 and prior periods.
Loss (gain) on digital assets
Loss on digital assets was $220.0 million for the twelve months ended December 31, 2025, compared to a gain on digital assets of $509.3 million for the twelve months ended December 31, 2024. The year-over-year unfavorable variance was primarily driven by a decrease in the price of Bitcoin, which declined from approximately $93,354 as of December 31, 2024 to approximately $87,498 as of December 31, 2025.
Other income (expense)
Other income was $22.2 million for the twelve months ended December 31, 2025, compared to other expense of $8.6 million for the twelve months ended December 31, 2024. This $30.8 million increase was primarily driven by (i) a $54.8 million increase in gain on derivatives related to our Bitcoin redemption option and call options, (ii) an $8.4 million increase in foreign exchange gain, (iii) a $1.0 million increase in gain on other financial liability, and (iv) a $0.4 million increase in gain on warrant liability. These gains were partially offset by (i) a $22.8 million increase in asset contributions costs related to the launch of American Bitcoin, (ii) a $6.0 million decrease in gain on debt extinguishment, (iii) a $3.1 million decrease in gain on bargain purchase related to the Far North JV acquisition in the prior period, (iv) a $1.6 million decrease in equity in earnings of unconsolidated joint venture, and (v) a $0.3 million decrease in interest expense due to lower interest rates on our outstanding debt.
Income tax benefit (provision)
Income tax benefit was $51.8 million for the twelve months ended December 31, 2025, compared to income tax provision of $113.5 million for the twelve months ended December 31, 2024. The income tax benefit for the twelve months ended December 31, 2025 was primarily driven by deferred tax impacts related to unrealized losses on digital assets, compared to an income tax provision for the twelve months ended December 31, 2024 that resulted from deferred tax impacts associated with unrealized gains on digital assets.
Loss from discontinued operations
Loss from discontinued operations was nil and $7.0 million for the twelve months ended December 31, 2025 and 2024, respectively. On March 6, 2024, we announced that we would cease operations at our Drumheller site in Alberta, Canada in connection with restructuring and optimization initiatives designed to strength financial performance. Of the $7.0 million loss related to the closure of our Drumheller site, the impairment of the long-term assets contributed $6.1 million and $3.2 million was from other operational activities. These losses were partially offset by a tax benefit of $2.3 million.
Twelve Months Ended December 31, 2024 and 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended |
|
|
|||||
|
|
|
December 31, |
|
|
Increase |
||||
|
(in USD thousands) |
|
2024 |
|
2023 |
|
|
(Decrease) |
||
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
Power |
|
$ |
56,602 |
|
$ |
22,794 |
|
$ |
33,808 |
|
Digital Infrastructure |
|
|
17,482 |
|
|
8,291 |
|
|
9,191 |
|
Compute |
|
|
80,701 |
|
64,851 |
|
|
15,850 |
|
|
Other |
|
|
7,600 |
|
|
110 |
|
|
7,490 |
|
Total revenue |
|
162,385 |
|
96,046 |
|
|
66,339 |
||
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue (exclusive of depreciation and amortization shown below): |
|
|
|
|
|
|
|
|
|
|
Cost of revenue - Power |
|
|
21,538 |
|
|
7,263 |
|
|
14,275 |
|
Cost of revenue - Digital Infrastructure |
|
|
15,556 |
|
|
4,321 |
|
|
11,235 |
|
Cost of revenue - Compute |
|
|
44,977 |
|
|
42,592 |
|
|
2,385 |
|
Cost of revenue - Other |
|
|
4,584 |
|
|
18 |
|
|
4,566 |
|
Total cost of revenue |
|
|
86,655 |
|
|
54,194 |
|
|
32,461 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating (income) expenses: |
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
47,773 |
|
|
17,537 |
|
|
30,236 |
|
General and administrative expenses |
|
|
72,917 |
|
|
49,133 |
|
|
23,784 |
|
Gain on digital assets |
|
|
(509,337) |
|
(32,626) |
|
|
(476,711) |
|
|
(Gain) loss on sale of property and equipment |
|
|
(634) |
|
|
888 |
|
|
(1,522) |
|
Realized gain on sale of digital assets |
|
|
- |
|
|
(2,376) |
|
|
2,376 |
|
Impairment of digital assets |
|
|
- |
|
|
1,431 |
|
|
(1,431) |
|
Impairment - other |
|
|
4,472 |
|
|
- |
|
|
4,472 |
|
Legal settlement |
|
|
- |
|
(1,531) |
|
|
1,531 |
|
|
Total operating (income) |
|
|
(384,809) |
|
|
32,456 |
|
|
(417,265) |
|
Operating income |
|
|
460,539 |
|
|
9,396 |
|
|
451,143 |
|
|
|
|
|
|
|
|
|
|
|
|
Other (expense) income: |
|
|
|
|
|
|
|
|
|
|
Foreign exchange gain (loss) |
|
|
(5,000) |
|
|
1,002 |
|
|
(6,002) |
|
Interest expense |
|
|
(29,794) |
|
|
(24,933) |
|
|
(4,861) |
|
Gain on debt extinguishment |
|
|
5,966 |
|
|
23,683 |
|
|
(17,717) |
|
Gain on derivatives |
|
|
6,780 |
|
|
- |
|
|
6,780 |
|
Gain on bargain purchase |
|
|
3,060 |
|
|
- |
|
|
3,060 |
|
Equity in earnings of unconsolidated joint venture |
|
10,359 |
|
12,815 |
|
|
(2,456) |
||
|
Total other (expense) income |
|
(8,629) |
|
12,567 |
|
|
(21,196) |
||
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations before taxes |
|
|
451,910 |
|
|
21,963 |
|
|
429,947 |
|
|
|
|
|
|
|
|
|
|
|
|
Income tax provision |
|
|
(113,457) |
|
|
(190) |
|
|
(113,267) |
|
|
|
|
|
|
|
|
|
|
|
|
Net income from continuing operations |
|
$ |
338,453 |
|
$ |
21,773 |
|
$ |
316,680 |
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) income from discontinued operations (net of income tax benefit of $2.3 million and nil, respectively) |
|
|
(7,044) |
|
|
77 |
|
|
(7,121) |
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
331,409 |
|
|
21,850 |
|
|
309,559 |
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net loss attributable to non-controlling interests |
|
|
473 |
|
|
- |
|
|
473 |
|
Net income attributable to Hut 8 Corp. |
|
$ |
331,882 |
|
$ |
21,850 |
|
$ |
310,032 |
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
331,409 |
|
$ |
21,850 |
|
$ |
309,559 |
|
Other comprehensive income (loss): |
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustments |
|
|
(56,390) |
|
|
10,761 |
|
|
(67,151) |
|
Total comprehensive income |
|
|
275,019 |
|
|
32,611 |
|
|
242,408 |
|
Less: Comprehensive income (loss) attributable to non-controlling interest |
|
|
549 |
|
|
- |
|
|
549 |
|
Comprehensive income attributable to Hut 8 Corp. |
|
$ |
275,568 |
|
$ |
32,611 |
|
$ |
242,957 |
Adjusted EBITDA reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended |
|
|
|
||||
|
|
|
December 31, |
Increase |
||||||
|
(in USD thousands) |
|
2024 |
|
2023 |
|
(Decrease) |
|||
|
Net income |
|
$ |
331,409 |
|
$ |
21,850 |
|
$ |
309,559 |
|
Interest expense |
|
29,794 |
|
|
24,933 |
|
|
4,861 |
|
|
Income tax provision |
|
113,457 |
|
|
190 |
|
|
113,267 |
|
|
Depreciation and amortization |
|
47,773 |
|
|
17,537 |
|
|
30,236 |
|
|
Share of unconsolidated joint venture depreciation, amortization, net of basis adjustments (1) |
|
21,792 |
|
|
21,016 |
|
|
776 |
|
|
Foreign exchange (gain) loss |
|
|
5,000 |
|
|
(1,002) |
|
|
6,002 |
|
(Gain) loss on sale of property and equipment |
|
|
(634) |
|
|
888 |
|
|
(1,522) |
|
Gain on debt extinguishment |
|
|
(5,966) |
|
|
(23,683) |
|
|
17,717 |
|
Gain on derivatives |
|
|
(6,780) |
|
|
- |
|
|
(6,780) |
|
Gain on bargain purchase |
|
|
(3,060) |
|
|
- |
|
|
|
|
Non-recurring transactions (2) |
|
|
(9,882) |
|
|
10,513 |
|
|
(20,395) |
|
Impairment - other |
|
|
4,472 |
|
|
- |
|
|
|
|
Loss from discontinued operations (net of income tax benefit of $2.3 million and nil, respectively) |
|
|
7,044 |
|
|
(77) |
|
|
7,121 |
|
(Income) loss attributable to non-controlling interests |
|
|
473 |
|
|
- |
|
|
473 |
|
Stock-based compensation expense |
|
20,783 |
|
|
13,563 |
|
|
7,220 |
|
|
Adjusted EBITDA |
|
$ |
555,675 |
|
$ |
85,728 |
|
$ |
469,947 |
|
(1) |
Net of the accretion of fair value differences of depreciable and amortizable assets included in equity in earnings of unconsolidated joint venture in the Consolidated Statements of Operations and Comprehensive Income (Loss) in accordance with ASC 323. See Note 11. Investments in unconsolidated joint venture of our Consolidated Financial Statements for further detail. |
|
(2) |
Non-recurring transactions for the twelve months ended December 31, 2024 represent approximately $4.0 million of restructuring costs and $1.9 million related to the Far North transaction costs, offset by a $13.5 million contract termination fee received from MARA, and a $2.2 million tax |
refund. Non-recurring transactions for the twelve months ended December 31, 2023 represent approximately $9.6 million related to a sales tax accrual and $2.4 million of transaction costs related to the Business Combination, partially offset by a gain from a legal settlement of $1.5 million.
Revenue
Total revenue was $162.4 million and $96.0 million for the twelve months ended December 31, 2024, and 2023, respectively, and consisted of Power, Digital Infrastructure, Compute, and Other.
Power
Power revenue was $56.6 million and $22.8 million for the twelve months ended December 31, 2024 and 2023, respectively. This $33.8 million increase was primarily driven by (i) a $13.5 million contract termination fee received from MARA, (ii) a $11.4 million increase in electricity sales through the Far North JV assets, which we acquired in February 2024, and (iii) an $8.9 million increase in Managed Services revenue related to the managed services agreement with Ionic, which was entered into during January 2024 and terminated effective December 2024.
Digital Infrastructure
Digital Infrastructure revenue was $17.5 million and $8.3 million for the twelve months ended December 31, 2024 and 2023, respectively. This $9.2 million increase was primarily driven by (i) a $5.2 million increase in CPU infrastructure revenue, reflecting a full year of revenue recognition following the Business Combination, and (ii) a $4.0 million increase in cost reimbursements related to the Ionic colocation agreement.
Compute
Compute revenue was $80.7 million and $64.9 million for the twelve months ended December 31, 2024 and 2023, respectively. This $15.8 million increase was primarily driven by (i) a $7.3 million increase in ASIC Compute revenue, largely due to an increase in the average revenue per Bitcoin mined from $30,398 to $60,436, partially offset by a decrease in Bitcoin mined, due to an increase in network difficulty and the Halving event (we mined 1,184 Bitcoin during the twelve months ended December 31, 2024 versus 2,138 Bitcoin mined during the twelve months ended December 31, 2023), (ii) a $6.7 million increase in recurring Traditional Cloud revenue, reflecting a full year of Traditional Cloud operations during twelve months ended December 31, 2024 compared to one month of Traditional Cloud operations following the Business Combination, and (iii) a $1.8 million contribution from our AI Cloud offering, which launched in September 2024.
Other
Other revenue was $7.6 million and nil for the twelve months ended December 31, 2024 and 2023, respectively. This increase was primarily driven by (i) a $7.4 million increase in Equipment Sales revenue, reflecting higher demand for mining-related infrastructure, and (ii) a $0.2 million increase in Equipment Repair service revenue.
Cost of revenue
Total cost of revenue was $86.7 million and $54.2 million for the twelve months ended December 31, 2024, and 2023, respectively, and consisted of Power, Digital Infrastructure, Compute, and Other.
Power
Power cost of revenue was $21.5 million and $7.3 million for the twelve months ended December 31, 2024 and 2023, respectively. This $14.2 million increase was primarily driven by (i) a $12.8 million increase in cost of revenue related to the Far North JV assets, which were acquired in February 2024, and (ii) a $1.4 million increase in operating costs related to the managed services agreement with Ionic, which was terminated effective December 2024.
Digital Infrastructure
Digital Infrastructure cost of revenue was $15.6 million and $4.3 million for the twelve months ended December 31, 2024 and 2023, respectively. This $11.2 million increase was primarily driven by (i) a $7.5 million increase in colocation-related costs as a result of eleven months of costs related to the Ionic colocation agreement during 2024 compared to five months of costs during 2023, and (ii) a $3.8 million increase in cost of sales related to CPU infrastructure operations, including rent, electricity, and connectivity costs, reflecting a full year of operations subsequent to the Business Combination.
Compute
Compute cost of revenue was $45.0 million and $42.6 million for the twelve months ended December 31, 2024 and 2023, respectively. This $2.4 million increase was primarily driven by (i) a $5.5 million increase in Traditional Cloud costs, reflecting a full year of Traditional Cloud operations during twelve months ended December 31, 2024 compared to one month of Traditional Cloud operations during twelve months ended December 31, 2023 following the Business Combination, and (ii) a $1.0 million increase in costs related to our AI Cloud offering, which launched in September 2024. These increases were partially offset by $4.1 million decrease in ASIC Compute costs due to fleet relocation from higher cost hosted to lower cost self-mining sites and the deployment of Reactor, our proprietary energy curtailment software.
Other
Other cost of revenue was $4.6 million and nil for the twelve months ended December 31, 2024 and 2023, respectively. This $4.6 million increase was primarily driven by (i) a $4.5 million increase in equipment sales costs as a result of the increased volume of equipment sold, and (ii) $0.1 million in costs related to our equipment repair service.
Depreciation and amortization
Depreciation and amortization expense was $47.8 million and $17.5 million for the twelve months ended December 31, 2024 and 2023, respectively. This $30.3 million increase was primarily driven by (i) higher depreciation from assets acquired in the Business Combination as we recognized twelve months of combined company depreciation in 2024 compared to one month of combined company depreciation in 2023, (ii) depreciation related to the Far North JV transaction, which was completed in February 2024, (iii) depreciation as a result of the development of the Salt Creek site, which went live in April 2024, and (iv) depreciation from the newly acquired assets related to our AI Cloud operations.
General and administrative expenses
G&A expenses were $72.9 million and $49.1 million for the twelve months ended December 31, 2024 and 2023, respectively. This $23.8 million increase was primarily driven by (i) a $10.6 million increase in salary and benefits due to twelve months of combined company expenses in 2024 compared to one month of combined company expenses in 2023 (our number of employees increased from 108 employees as of November 30, 2023, the date of the Business Combination, to 220 employees as of December 31, 2024), (ii) a $7.2 million increase in stock-based compensation due to new restricted stock unit and performance stock unit grants to retain and incentivize our talent, partially offset by no restricted stock award activity in 2024 compared to $8.5 million of restricted stock activity in 2023, (iii) a $3.9 million increase in restructuring expenses related to the Business Combination, and (iv) a $1.9 million increase in costs related to Far North JV acquisition.
Gains on digital assets
Gains on digital assets were $509.3 million and $32.6 million for the twelve months ended December 31, 2024 and 2023, respectively. This increase was due to the increased Bitcoin prices as of December 31, 2024 compared to the prior year period. The price of Bitcoin as of December 31, 2024 was approximately $93,354 compared to $42,288 as of December 31, 2023.
Other expense (income)
Other expense was $8.6 million for the twelve months ended December 31, 2024 compared to other income of $12.6 million for the twelve months ended December 31, 2023. This $21.2 million increase was primarily driven by (i) a $17.7 million decrease in gain on debt extinguishment related to the Anchorage debt-to-equity conversion of $6.0 million in 2024, compared to $23.7 million debt extinguishment related to the NYDIG loan recorded in 2023, (ii) a $3.6 million increase in interest expense due to an increase in the amount of borrowing in 2024 compared to 2023, which comprised of the $150.0 million Coatue note and the additional $15.0 million drawdown from our loan with Coinbase, (iii) a $6.0 million increase in foreign exchange loss due to our net U.S. dollar monetary liability position in our Canadian dollar functional currency subsidiaries and a decline in the Canadian dollar to U.S. dollar exchange rate of approximately 8% compared to a 2% increase during the twelve months ended December 31, 2023 (the increase noted in the prior period is for the period from the Business Combination to December 31, 2023, reflecting one month of combined company results), and (iv) a $2.0 million decrease in equity in earnings of King Mountain JV due to the impact of the Halving on ASIC Compute revenue. These increases were partially offset by (i) a $7.3 million gain on derivatives due to an increase in the mark-to-market value of our call options and Bitcoin redemption option, and (ii) a $3.1 million gain on bargain purchase related to the Far North JV acquisition driven by the fair value of the net assets acquired being greater than the consideration transferred.
Income tax provision
Our income tax provision was $113.5 million and $0.2 million for the twelve months ended December 31, 2024 and 2023, respectively. This $113.3 million increase was primarily due to $93.0 million in deferred taxes related to the gain on the fair value of our Bitcoin holdings, in addition to higher taxable income for the twelve months ended December 31, 2024.
Six Months Ended December 31, 2023 and 2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
|
|||||
|
|
|
December 31, |
|
|
Increase |
||||
|
(in USD thousands) |
|
2023 |
|
2022 |
|
|
(Decrease) |
||
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
Power |
|
$ |
12,595 |
|
$ |
2,600 |
|
$ |
9,995 |
|
Digital Infrastructure |
|
|
5,817 |
|
|
14,006 |
|
|
(8,189) |
|
Compute |
|
|
41,347 |
|
25,744 |
|
|
15,603 |
|
|
Other |
|
|
110 |
|
|
3,635 |
|
|
(3,525) |
|
Total revenue |
|
59,869 |
|
45,985 |
|
|
13,884 |
||
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue (exclusive of depreciation and amortization shown below): |
|
|
|
|
|
|
|
|
|
|
Cost of revenue - Power |
|
|
3,366 |
|
|
1,063 |
|
|
2,303 |
|
Cost of revenue - Digital Infrastructure |
|
|
4,276 |
|
|
400 |
|
|
3,876 |
|
Cost of revenue - Compute |
|
|
26,040 |
|
|
23,193 |
|
|
2,847 |
|
Cost of revenue - Other |
|
|
18 |
|
|
3,112 |
|
|
(3,094) |
|
Total cost of revenue |
|
|
33,700 |
|
|
27,768 |
|
|
5,932 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses (income): |
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
10,569 |
|
|
11,811 |
|
|
(1,242) |
|
General and administrative expenses |
|
|
37,547 |
|
|
10,609 |
|
|
26,938 |
|
Gain on digital assets |
|
|
(32,626) |
|
- |
|
|
(32,626) |
|
|
Loss on sale of property and equipment |
|
|
443 |
|
- |
|
|
443 |
|
|
Realized gain on sale of digital assets |
|
|
- |
|
|
(2,201) |
|
|
2,201 |
|
Impairment of digital assets |
|
|
- |
|
|
2,272 |
|
|
(2,272) |
|
Impairment of long-lived assets |
|
|
- |
|
|
63,574 |
|
|
(63,574) |
|
Total operating expense (income) |
|
|
15,933 |
|
|
86,065 |
|
|
(70,132) |
|
Operating income (expense) |
|
|
10,236 |
|
|
(67,848) |
|
|
78,084 |
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
Foreign exchange gain |
|
|
1,002 |
|
|
- |
|
|
1,002 |
|
Interest expense |
|
|
(11,701) |
|
|
(14,703) |
|
|
3,002 |
|
Equity in earnings (loss) of unconsolidated joint venture |
|
6,173 |
|
(510) |
|
|
6,683 |
||
|
Total other expense |
|
(4,526) |
|
(15,213) |
|
|
10,687 |
||
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations before taxes |
|
|
5,710 |
|
|
(83,061) |
|
|
88,771 |
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit |
|
|
421 |
|
|
1,808 |
|
|
(1,387) |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) from continuing operations |
|
$ |
6,131 |
|
$ |
(81,253) |
|
$ |
87,384 |
|
|
|
|
|
|
|
|
|
|
|
|
Income from discontinued operations (net of income tax of nil and nil, respectively) |
|
|
77 |
|
|
- |
|
|
77 |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
6,208 |
|
$ |
(81,253) |
|
$ |
87,461 |
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income: |
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustments |
|
|
10,761 |
|
|
- |
|
|
10,761 |
|
Total comprehensive income (loss) |
|
$ |
16,969 |
|
$ |
(81,253) |
|
$ |
98,222 |
Adjusted EBITDA reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
|
|
||||
|
|
|
December 31, |
Increase |
||||||
|
(in USD thousands) |
|
2023 |
|
2022 |
|
(Decrease) |
|||
|
Net income (loss) |
|
$ |
6,208 |
|
$ |
(81,253) |
|
$ |
87,461 |
|
Interest expense |
|
11,701 |
|
|
14,703 |
|
|
(3,002) |
|
|
Income tax benefit |
|
(421) |
|
|
(1,808) |
|
|
1,387 |
|
|
Depreciation and amortization |
|
10,569 |
|
|
11,811 |
|
|
(1,242) |
|
|
Share of unconsolidated joint venture depreciation, amortization, net of basis adjustments (1) |
|
10,503 |
|
|
2,540 |
|
|
7,963 |
|
|
Foreign exchange gain |
|
|
(1,002) |
|
|
- |
|
|
(1,002) |
|
Losses on sale of property and equipment |
|
|
443 |
|
|
- |
|
|
443 |
|
Non-recurring transactions (2) |
|
|
12,044 |
|
|
- |
|
|
12,044 |
|
Impairment of long-lived assets |
|
|
- |
|
|
63,574 |
|
|
|
|
Income from discontinued operations (net of income tax benefit of nil and nil, respectively) |
|
|
(77) |
|
|
- |
|
|
(77) |
|
Stock-based compensation expense |
|
12,216 |
|
|
3,263 |
|
|
8,953 |
|
|
Adjusted EBITDA |
|
$ |
62,184 |
|
$ |
12,830 |
|
$ |
49,354 |
(1) Net of the accretion of fair value differences of depreciable and amortizable assets included in equity in earnings of unconsolidated joint venture in the Consolidated Statements of Operations and Comprehensive Income (Loss) in accordance with ASC 323. See Note 11. Investment in unconsolidated joint venture of the Consolidated Financial Statements for further detail.
|
(2) |
Non-recurring transactions for the six months ended December 31, 2023 represent approximately $2.4 million of transaction costs related to the Business Combination and $9.6 million related to a sales tax accrual. |
Revenue
Total revenue for the six months ended December 31, 2023 and 2022 was $59.9 million and $46.0 million, respectively, consisting of Power, Digital Infrastructure, Compute, and Other.
Power
Power revenue was $12.6 million for the six months ended December 31, 2023, consisting of (i) $9.6 million in fees from Managed Services and (ii) $3.0 million in cost reimbursements. Power revenue was $2.6 million for the six months ended December 31, 2022, primarily consisting of (i) $1.5 million in managed service fees and (ii) $1.1 million in cost reimbursements. We began our Managed Services offerings for third parties in November 2022; therefore, the six months ended December 31, 2023 reflects a full period of activity related to Managed Services, whereas the comparative period of the six months ended December 31, 2022 reflects less than two months of activity. The six months ended December 31, 2023 also includes revenue from an interim Managed Services agreement with Celsius Mining LLC, which was signed in December 2023.
Digital Infrastructure
Digital Infrastructure revenue was $5.8 million and $14.0 million for the six months ended December 31, 2023, and 2022, respectively. Revenue for the six months ended December 31, 2023 primarily consisted of (i) hosting services revenue from our Alpha site and (ii) one month of recurring CPU infrastructure revenue as a result of the Business Combination. Revenue for the six months ended December 31, 2022 consisted of $14.0 million of hosting services revenue. During six months ended December 31, 2022, one of our hosting customers defaulted on its contract, resulting in contract termination without a refund obligation for prepaid amounts. This resulted in the recognition of $13.1 million in remaining deferred revenue related to this customer.
Compute
Compute revenue consisted of ASIC Compute revenue of $41.3 million and $25.7 million for the six months ended December 31, 2023 and 2022, respectively. This was primarily driven by (i) an increase in the average price per Bitcoin mined and (ii) one month of combined company activity after the Business Combination. The average revenue per Bitcoin mined was approximately $33,331 as of December 31, 2023 compared to approximately $20,218 as of December 31, 2022. This was partially offset by a decrease of approximately 29 Bitcoin mined, exclusive of our net share of the King Mountain JV, period over period due to increased Bitcoin network difficulty.
Other
Other revenue was $0.1 million and $3.6 million for the six months ended December 31, 2023 and 2022, respectively. Other revenue for the six months ended December 31, 2023 consisted of $0.1 million in equipment repair services revenue. Other revenue for the six months ended December 31, 2022 consisted of $3.6 million in equipment sales revenue.
Cost of revenue
Power
Cost of revenue for Power for the six months ended December 31, 2023 and 2022 were $3.4 million and $1.1 million, respectively, primarily consisting of reimbursable payroll and other site operating costs. The increase in costs is primarily attributable to the full six months of activity in the 2023 period compared to only two months of activity related to Managed Services in the 2022 period.
Digital Infrastructure
Cost of revenue for Digital Infrastructure for the six months ended December 31, 2023 and 2022 were $4.3 million and $0.4 million, respectively, primarily driven by an increase in the cost of hosting services, including power costs, at our Alpha site due to an increase in hosted miners at the site.
Compute
Cost of revenue for Compute for the six months ended December 31, 2023 and 2022 were $26.0 million and $23.2 million, respectively, driven primarily by a 46% increase in electricity utilized, partially offset by a lower average power rate during the period ($61.17 compared to $73.95 for the six months ended December 31, 2023 and 2022, respectively).
Other
Cost of revenue for Other for the six months ended December 31, 2023 was less than $0.1 million due to low activity, as there were no equipment sales. Cost of revenue for Other for the six months ended December 31, 2022 was $3.1 million due to the cost of mining equipment sold.
Depreciation and amortization
Depreciation and amortization expense was $10.6 million and $11.8 million for the six months ended December 31, 2023 and 2022, respectively. The decrease in depreciation and amortization expense was primarily driven by the lower net book value of plant and equipment after the recognition of a non-cash impairment charge during the six months ended December 31, 2022 as part of annual impairment testing, partially offset by property and equipment acquired as part of the Business Combination.
General and administrative expenses
G&A expenses were $37.5 million and $10.6 million for the six months ended December 31, 2023 and 2022, respectively. The increase in G&A expenses was driven by (i) a $9.0 million increase in stock-based compensation due to certain stock options granted and restricted stock awards that were accelerated upon the closing of the Business Combination and certain stock options and restricted stock awards that were issued and immediately vested before the closing of the Business Combination, (ii) a $3.7 million increase in salary and benefit costs due to the headcount increasing from 49 to 208 employees as part of the Business Combination and to support the our growth, and (iii) a $9.6 million sales tax provision from a non-recurring state tax accrual related to a facility build out. G&A expenses for the six months ended December 31, 2023 also include one-time transaction costs of $2.4 million primarily related to the Business Combination.
Gains on digital assets
Gains on digital assets were $32.6 million and nil for the six months ended December 31, 2023 and 2022, respectively. The increase was due to our early adoption of ASU 2023-08 for the six months ended December 31, 2023, which requires us to recognize our digital assets at fair value with changes recognized in net income during the reporting period.
Impairment of long-lived assets
Impairment of long-lived assets, including right-of-use assets, was nil and $63.6 million for the six months ended December 31, 2023 and 2022, respectively. During the six months ended December 31, 2022, adverse changes in the business climate, including decrease in the price of Bitcoin to approximately $16,530 as of December 31, 2022, and the resulting decrease in the market price of miners and mining equipment, indicated that an impairment triggering event had occurred. Testing performed indicated that the estimated fair value of our miners, mining equipment, and other mining operation assets were less than their net carrying value as of December 31, 2022. An impairment charge of approximately $63.6 million was recognized, decreasing the net carrying value of these assets to their estimated fair value.
Other expense
Other expense totaled $4.5 million for the six months ended December 31, 2023 compared to $15.2 million for the six months ended December 31, 2022. The decrease of $10.7 million was primarily driven by a $6.7 million increase in equity in earnings of our unconsolidated joint venture and a decrease of $3.0 million in interest expense driven by the NYDIG debt restructuring in February 2023.
Income tax benefit
Our income tax benefit was $0.4 million and $1.8 million for the six months ended December 31, 2023 and 2022, respectively. This $1.4 million decrease was primarily due to lower taxable income for the six months ended December 31, 2023 compared to the prior period.
King Mountain JV
The King Mountain JV is a 50% joint venture with one of the world's largest renewable energy producers. The King Mountain JV has 280 MW of behind-the-meter self-mining and hosting operations located at a wind farm in McCamey, Texas.
As of December 31, 2025, the King Mountain JV owned approximately 18,000 miners for self-mining (about 1.8EH/s) and hosted approximately 56,562 miners (about 10.2 EH/s) for a single hosting customer at its King Mountain site, which has a total capacity of 280 MW.
We account for the King Mountain JV using the equity method of accounting, resulting in reporting the King Mountain JV as an unconsolidated joint venture. Additionally, our 50% portion of any distributions from the King Mountain JV are used to pay down the TZRC Secured Promissory Note. See Note 11. Investment in unconsolidated joint venture and Note 15. Loans, notes payable, and other financial liabilities to the consolidated financial statements found elsewhere in this Annual Report for additional information on the King Mountain JV and TZRC Secured Promissory Note.
Below are the condensed consolidated income statements for the King Mountain JV for the twelve months ended December 31, 2025 and December 31, 2024, and the six months ended December 31, 2023 and December 31, 2022.
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|
|
|
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|
|
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|
Condensed Consolidated Income Statement |
||||||||||||
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Twelve Months Ended |
|
Six Months Ended |
||||||||
|
|
|
December 31, |
|
December 31, |
||||||||
|
(in USD thousands) |
|
2025 |
|
2024 |
|
2023 |
|
2022 |
||||
|
Total revenue, net |
|
$ |
136,336 |
|
$ |
143,685 |
|
$ |
80,565 |
|
$ |
12,144 |
|
Gross profit |
|
|
57,128 |
|
|
69,832 |
|
|
38,667 |
|
|
4,133 |
|
Net income (loss) |
|
|
3,509 |
|
|
6,775 |
|
|
5,371 |
|
|
(1,020) |
|
Net income (loss) attributable to investee |
|
|
1,755 |
|
|
3,388 |
|
|
2,686 |
|
|
(510) |
Our board of directors and management team also evaluate Adjusted EBITDA for the King Mountain JV, which is a non-GAAP financial measure. We define Adjusted EBITDA as net income (loss) before depreciation and amortization and interest income. We use Adjusted EBITDA to assess the King Mountain JV's financial performance because it allows us to compare the operating performance on a consistent basis across periods by removing the effects of the King Mountain JV's capital structure.
Net income (loss) is the GAAP measure most directly comparable to Adjusted EBITDA. This non-GAAP financial measure should not be considered as an alternative to the most directly comparable GAAP financial measure. In evaluating Adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in such presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. There can be no assurance that we will not modify the presentation of Adjusted EBITDA in the future, and any such modification may be material. Adjusted EBITDA has important limitations as an analytical tool and you should not consider Adjusted EBITDA in isolation or as a substitute for analysis of our results as reported under GAAP. Because Adjusted EBITDA may be defined differently by other companies in our industry, our definition of this non-GAAP financial measure may not be comparable to similarly titled measures of other companies, thereby diminishing its utility.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended |
|
Six Months Ended |
||||||||
|
|
December 31, |
|
December 31, |
||||||||
|
(in USD thousands) |
2025 |
|
2024 |
|
2023 |
|
2022 |
||||
|
Net income (loss) |
$ |
3,509 |
|
$ |
6,775 |
|
$ |
5,371 |
|
$ |
(1,020) |
|
Depreciation and amortization |
49,490 |
62,519 |
|
30,478 |
5,079 |
||||||
|
Interest income |
|
(3,169) |
|
|
(3,325) |
|
|
(413) |
|
|
- |
|
Adjusted EBITDA |
$ |
49,830 |
|
$ |
65,969 |
|
$ |
35,436 |
|
$ |
4,059 |
Liquidity and Capital Resources
Our primary sources of liquidity include our cash and cash equivalents, debt facilities, Bitcoin on our balance sheet, equity sales, and the cash flows generated from operations. We are exploring additional financing structures, including the use of project-level financing, to finance our development initiatives, including infrastructure build outs. Under our lease agreement with Fluidstack, we are required to build and deliver a data center with 245 MW IT capacity in phases with initial delivery targeted for Q2 2027. We have partnered with Jacobs and Vertiv to build the data center at a cost of $9-$11 million per MW.
Historically, our primary cash needs have been for working capital to support growth initiatives, including infrastructure purchases and development, acquisitions, and equipment financing, including the purchase of additional Bitcoin miners. Going forward, we will continue to prioritize infrastructure development while our ASIC compute operations will mainly be conducted through American Bitcoin, our consolidated subsidiary. In addition to equipment financing for the purchase of additional Bitcoin miners, American Bitcoin's primary cash needs are to support its Bitcoin accumulation efforts, including at-market purchases of Bitcoin.
In June 2025, we amended our Credit Agreement with Coinbase to, among other things, amend and increase available capacity under the credit facility from $65.0 million to up to $130.0 million. In August 2025, we borrowed the remaining $65.0 million of the available capacity. In December 2025, we further amended the Coinbase Credit Agreement to increase the facility from $130.0 million to $200.0 million and borrowed an additional $70.0 million.
As of December 31, 2025, we had access to $200.0 million from the Two Prime Credit Agreement. We did not draw on this facility during the twelve months ended December 31, 2025.
On August 22, 2025, we established our $1.0 billion 2025 ATM, which replaced our prior $500 million 2024 ATM program that launched on December 4, 2024. As of August 22, 2025, prior to its termination, we had issued and sold shares under the 2024 ATM for gross proceeds of $299.4 million at a weighted average price of $27.83 per share. For reference, our average share price from commencement of the 2024 ATM until August 22, 2025 was $18.61 per share. As of December 31, 2025, we issued and sold 4,020,630 shares under the 2025 ATM for gross proceeds of $183.4 million at a weighted average issuance price of $45.62 per share.
On September 3, 2025, American Bitcoin established a $2.1 billion at-the-market equity program (the "American Bitcoin 2025 ATM"). As of December 31, 2025, American Bitcoin issued and sold 65,485,198 shares of Class A common stock under the American Bitcoin 2025 ATM for gross proceeds of $240.5 million at a weighted average issuance price per share of $3.67.
Our ability to meet our anticipated cash requirements will depend on various factors including our ability to maintain our existing business, enter into new lines of business, provide new offerings, compete with existing and new competitors in existing and new markets and offerings, acquire new businesses or pursue strategic transactions, access public and private capital markets, and respond to global and domestic economic, geopolitical, social conditions and their impact on demand for our offerings.
We believe that cash flows generated from operating activities, Bitcoin held on our consolidated balance sheet, and other financings will be sufficient to meet our anticipated short-term cash requirements. With respect to the construction of our River Bend data center facility, we currently expect to fund our capital expenditures through a combination of cash and Bitcoin on our balance sheet and project-level financing of up to 85% LTC, which is expected to be underwritten by J.P. Morgan, as lead left arranger, and Goldman Sachs, each anticipated to serve as a loan underwriter, subject to the negotiation and execution of definitive transaction agreements and the satisfaction of customary closing conditions. On a long-term basis, we plan to rely on access to public and private capital markets for any long-term funding not provided by operating cash flows, cash on hand, Bitcoin on our consolidated balance sheet, and debt and project financing.
Cash Flows
The following table summarizes our cash flows for the periods indicated:
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended |
||||
|
|
|
December 31, |
||||
|
(in USD thousands) |
|
2025 |
|
2024 |
||
|
Cash flows used in operating activities |
|
$ |
(139,226) |
|
$ |
(68,535) |
|
Cash flows used in investing activities |
|
|
(754,207) |
|
|
(188,472) |
|
Cash flows provided by financing activities |
|
|
856,127 |
|
|
311,946 |
Operating Activities
Net cash used in operating activities was $139.2 million for the twelve months ended December 31, 2025, resulting from net loss of $248.0 million, offset by adjustments to reconcile net income to net cash used in operating activities of $159.6 million and changes in assets and liabilities of $50.8 million. Net cash used in operating activities was $68.5 million for the twelve months ended December 31, 2024, resulting from net income of $331.4 million, offset by adjustments to reconcile net income to net cash used in operating activities of $385.5 million and changes in assets and liabilities of $14.4 million.
Investing Activities
Net cash used in investing activities totaled $754.2 million for the twelve months ended December 31, 2025, primarily consisting of (i) $405.1 million in Bitcoin purchases by American Bitcoin for its strategic reserve, (ii) $202.9 million in property and equipment purchases primarily related to Vega and River Bend construction, (iii) $162.7 million in deposits for future site land and infrastructure purchases, (iv) $25.0 million in purchases of other digital assets, and (v) $14.0 million in deposits paid to purchase miners and mining equipment. These outflows were partially offset by (i) $46.0 million in cash received from the Bitmain deposit refund, (ii) $5.9 million in proceeds from the sale of property and equipment, and (iii) $3.7 million in proceeds from the sale of digital assets. Net cash provided by investing activities totaled $188.5 million for the twelve months ended December 31, 2024, primarily consisting of (i) $124.0 million in property and equipment purchases, (ii) $100.7 in Bitcoin purchases for our strategic reserve, and (iii) a $39.6 million deposit for acquiring miners. These inflows were partially offset by $74.5 million in proceeds from the sale of Bitcoin.
Financing Activities
Net cash provided by financing activities was $856.1 million for the twelve months ended December 31, 2025, primarily consisting of (i) $314.4 million in net proceeds from the issuance of common stock through our 2024 ATM and 2025 ATM, (ii) $237.7 million in net proceeds from the issuance of American Bitcoin's Class A common stock through the American Bitcoin 2025 ATM, (iii) $205.3 million in net cash proceeds from the issuance and sale of American Bitcoin's Class A common stock through a Common Stock Purchase Agreement for a private placement with certain accredited investors, and (iv) $135 million in proceeds under the Coinbase Credit Agreement. These inflows were partially offset by $45.6 million in loan repayments. Net cash provided by financing activities was $311.9 million for the twelve months ended December 31, 2024, primarily consisting of (i) $150.0 million in net proceeds from notes payable from the Coatue note, (ii) $162.0 million in net proceeds from the issuance of common stock through our 2024 ATM, and (iii) $22.2 million in net proceeds from covered call options premiums.
Critical Accounting Policies and Estimates
Our management's discussion and analysis of our financial condition and results of operations is based on our Consolidated Financial Statements, which have been prepared in accordance with GAAP. The preparation of these Consolidated Financial Statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses, as well as related disclosures. We evaluate our estimates and assumptions on an ongoing basis and base them on historical experience and other factors we believe to be reasonable under the circumstances. Because these estimates involve judgments about future events and are inherently uncertain, actual results may differ materially from those estimates. Changes in these estimates or assumptions could have a material impact on our results of operations, financial position, and statement of cash flows.
While our significant accounting policies are described in more detail in Note 2, Basis of Presentation, Summary of Significant Accounting Policies and Recent Accounting Pronouncements, included elsewhere in this Annual Report, we believe the following accounting policies and estimates are most critical to understanding and evaluating this management discussion and analysis:
|
|
Digital Assets
Accounting for digital assets requires significant judgment, including classification, measurement, presentation, and the determination of fair value. Digital assets pledged as collateral, including under arrangements with Bitmain, require additional judgment in evaluating the appropriate accounting treatment, including whether such assets remain recognized on our Consolidated Balance Sheets. Pledged digital assets remain recognized because we retain ownership and continue to be exposed to changes in market value.
Stock-Based Compensation
We recognize compensation expense for all stock-based payment awards made to employees, directors, consultants, and service providers, if any, including incentive stock options, non-qualified stock options, stock awards, and stock units based upon the estimated grant-date fair value of the awards. For more complex performance awards, including awards with market-based performance conditions, we employ a Monte Carlo simulation valuation method to calculate the fair value of the awards based on the most likely outcome. Under the Monte Carlo simulation, a number of variables and assumptions are used including, but not limited to, the expected stock price volatility over the term of the award, the risk-free rate, and dividend yield, if any.
Finite-Lived Intangible Assets
We evaluate the useful lives of our intangible assets to determine if they are finite or indefinite-lived. Reaching a determination on useful life requires significant judgments and assumptions regarding the future effects of obsolescence, demand, competition, and other economic factors. Finite-lived intangible assets are amortized over their estimated useful lives and evaluated for impairment at least annually, or when events or changes in circumstances indicate that their carrying amounts may not be recoverable. Determining useful lives and assessing recoverability require management judgment and the use of estimates, including assumptions regarding future cash flows and economic conditions. Changes in these assumptions could materially affect amortization expense or result in impairment charges in future periods.
Hut 8 Corp. published this content on February 25, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on February 25, 2026 at 11:37 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]