Bitfarms Ltd. Q3 FY2025 earnings call

• Market Thesis: Infrastructure for HPC and AI is not a bubble, with data center demand accelerating and infrastructure supply lagging, creating opportunities for lease rate growth.
• Strategic Actions: Prioritize infrastructure development, leverage supply-demand gap for higher rates, and lead in developing infrastructure for NVIDIA's Vera Rubin GPUs.
• Site Updates: Washington site plans to convert to HPC/AI, with potential cloud monetization; Panther Creek has 350 MW secured power, with potential expansion; Sharon has 110 MW in development; Quebec has 170 MW of low-cost hydropower; Scrubgrass has potential for 1.3 GW capacity.
• Balance Sheet: Strong balance sheet with over $1 billion in financial flexibility, including cash, Bitcoin, and Panther Creek project facility with Macquarie.
• Financial Performance: Q3 saw $84 million total revenue, with continuing operations revenue up 156%, and introduction of Bitcoin 2.1 program to offset costs.

In Q3, Bitfarms achieved total revenue of $84 million from continuing and discontinued operations. From continuing operations, they earned 520 Bitcoin with revenue of $69 million, a year-over-year increase of 156%. Gross mining profit was $21 million, with a gross margin of 35% and an average direct cost of $48,200 per Bitcoin mined. Cash G&A for Q3 was $14 million, operating loss from continuing operations was $29 million including a $9 million impairment charge, and adjusted EBITDA from continuing operations was $20 million (28% of revenue).

• Plan to fully convert unique energy assets to HPC/AI infrastructure.
• Announced conversion of Washington site to HPC/AI and leading development of Vera Rubin GPUs infrastructure.
• Actively evaluating cloud monetization for Washington site as a cash flow driver.
• Well-capitalized with over $1 billion to fund investments in HPC/AI build-outs.

• Potential bottlenecks in infrastructure supply leading to lease rate uncertainties.
• Construction risks and uncertainties in meeting time lines for site developments.
• Evolving hardware challenges with rapid advancements in GPU technology requiring continuous infrastructure updates.

Q: Can you share more on how economics for Vera Rubin GPU infrastructure command a premium to Blackwell infrastructure?

A: Vera Rubin GPUs have higher energy density, creating infrastructure shortages, and companies will pay higher costs to deploy them quickly. Economics are specific to GPU models, with infrastructure for newer models in greater demand.

Q: How should we think about the wind down of mining operations?

A: Paso Pe site sale will pull forward free cash flow, with Washington site likely coming offline mid-2026, and other sites converting slowly to HPC/AI.

Q: Update on power capacity expansion at PA sites?

A: Positive indications on converting ISA to ESA at Panther Creek, with Phase 3/4 possible, and Scrubgrass potential in 2028.

Q: Confidence in acquiring GPUs on timely basis?

A: High confidence with leading GPU manufacturers having finance programs, and OEM manufacturers offering turnkey solutions with financing.