MARA Holdings, Inc. Q1 FY2025 earnings call

Key Points

• Bitcoin shows resilience and MARA positions itself as a macro hedge.
• Transformation into vertically integrated digital energy and infrastructure company with two priorities: strategic growth with low-cost energy and efficient capital deployment, and advancing R&D of digital energy technologies.
• Q1 operational metrics: completed 200-megawatt data center in Ohio with 100 megawatts online, fully energized 25-megawatt gas to power operations, building 114-megawatt wind farm.
• Digital energy technologies: founding investor in Auradine, deploying custom miners, hardware 2PIC in merchant cooling, software MARA Pool for higher revenues.

In Q1 2025, revenues increased to $213.9 million from $165.2 million in Q1 2024. Purchased energy cost per Bitcoin was $35,728. Daily cost per petahash improved 25% year-over-year. Owned mining sites had a purchase energy cost per Bitcoin of $35,728 per coin and $0.04 per kilowatt hour. Adjusted EBITDA decreased to a loss of $483.6 million in Q1 2025 from $542.1 million in Q1 2024. The company currently holds over 48,000 bitcoins on its balance sheet. Revenue contribution from Bitcoin price was about $90.7 million, but was partially offset by a decrease in Bitcoin production due to increased network difficulty.

Forward-Looking

• Expect Bitcoin price recovery to positively impact Q2 results.
• Unrealized fair market value loss in Q1 due to Bitcoin price drop, but current price implies fair value gain in Q2.
• Positioning MARA solutions to support AI inference workloads with advanced talks with compute OEMs.

Risks

• Market correlation with Bitcoin price and sector sentiment.
• Tariffs impacting mining rig procurement.
• Potential trade-offs in off-grid mining like reduced rig uptime, higher operational expenses, elevated CapEx.

Q: Stephen Glagola asked about the market disconnect between MARA's fundamentals and share performance and Bitcoin price behavior.

A: Fred Thiel responded that the market values MARA for Bitcoin holdings but not for mining operations, and discussed states establishing Bitcoin strategic reserves and institutional inflows into ETFs driving Bitcoin price.

Q: Stephen asked about the timeline for partnerships.

A: Fred Thiel said there will be progress in 2025 with announcements indicating potential over the next few years.

Q: Stephen asked about hash cost impact of off-grade power capacity.

A: Salman Khan and Fred Thiel responded that hash cost will continue to decline due to actionable projects and sourcing low-cost energy, with examples like the wind farm reducing costs.

Q: Stephen asked about IRR for off-grid vs grid-connected mining.

A: Fred Thiel discussed infrastructure costs and profitability of wind farms, and Salman mentioned IRRs in the range of 30%-40% for ARP programs.

Q: Stephen asked about 2PIC pilot project and AI revenue opportunities.

A: Fred Thiel talked about 2PIC overclocking benefits and AI cooling solutions, with pilots underway with compute OEMs.

Q: Stephen asked about Auradine ownership and tariffs.

A: Fred Thiel said MARA owns under 15% of Auradine and discussed minimizing tariff impact through supply chain optimization.

Q: Stephen asked about ATM equity facility rationale.

A: Salman Khan discussed capital sources and accretive projects, focusing on return on capital employed.

Q: Stephen asked about maintaining full HODL strategy.

A: Fred Thiel explained MARA's twin turbocharge strategy with HODL and mining, expecting long-term value for stockholders.