Canadian Miner Bitfarms Releases Q3 Loss Despite Lofty Bitcoin Price

Bitfarms’ gross profit and margin both turned negative on a year-on-year basis for the quarter. However, some nine-month results still managed to improve on a year-on-year basis. 

Q3 2020 revenue fell 30% year-on-year, from $ 9.7 million to nearly $6.8 million. Compared to Q2 2020, revenue dropped 7.7%. Gross mining margin plummeted year-on-year for the quarter from 67% to 26%.

The company’s’ nine-month gross mining margin numbers were a little better, with the margin dropping from 62% to 38%.

Whys and Machines

The worsening figures, Bitfarms claims, were largely due to the Bitcoin halving event on May 11, 2020. Meanwhile, CAPEX grew as a result of a major upgrade that was also designed to cut operating expenses. 

Among other measures, Bitfarms is upgrading its mining machine complement at its five mining sites in Quebec. In an October press release, the company announced that it had completed leasing arrangements on new mining machines that would be installed by the end of November.

Moreover, the release gave insights into the company’s operation. Hashing capacity grew by 55%, or 431 pentahashes (PH) over the nine months of 2020.

The company leased or purchased 5,800 WhatsMiner M20 and M31 series miners, and will likely announce the addition of another 504PH in November and December

South American Power

Bitfarms plans to expand into the Latin American region in the near future, and the company is working to cut expenses, including electricity rates.

It announced on Oct 26 that it had secured the ‘exclusive’ use of up to 200 MW of electricity in South America, priced at $0.02 per kilowatt-hour (“kWh”) on average from a private energy supplier.

The firm signed a non-binding memorandum of understanding with the producer.

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