Marathon Digital Q4 Report: Revenue Down, but Shares Up

Also, Marathon Digital has disclosed the nature of its exposure to the cryptocurrency-focused institution Silvergate Bank, which is no longer in business.

The troubled Bitcoin (BTC) mining company Marathon Digital Holdings Inc (NASDAQ: MARA) has issued its performance evaluation for the fourth quarter (Q4) of 2022, in which it revealed a revenue that was lower than anticipated.

The company said that its total revenue come in at $28.4 million, which is 58% lower than its record revenue from the previous year.

Marathon Digital is a company that competes in an extremely competitive industry. This is due to the fact that the global economy, the high cost of electricity, and the declining price of Bitcoin have primarily put the company on the verge of collapse over the course of the past year.

But, despite the low expectations that have been maintained for the company, the revenue that has been announced is even less than the $38.4 million that was anticipated quite some time ago.

According to the corporation, its performance over the course of the complete year highlighted the challenges it faced during the first part of the year.

The company, which has its headquarters in Las Vegas, Nevada, reported that the full-year revenue it generated for the 2022 fiscal year decreased by as much as 26 percent, coming in at $117.8 million. This number was derived from an adjusted value of $159.2 million in the year 2021.

Marathon Digital stated that it recorded an impairment loss of $686.7 million, a figure that significantly outweighs the loss of $37.1 million that it accumulated in 2021.

This news comes in the midst of the company’s ongoing operational difficulties, which nearly drove it to a state of sustained bankruptcy.

The company blamed its poor performance on “fourth quarter asset impairments related to the carrying amount of mining rigs and advances to vendors” that amounted to $332.9 million. The company’s woes were explained as follows:

In spite of the news that its performance reports fell short of expectations, the shares of Marathon Digital are increasing to show a positive association with Bitcoin’s price.

Thursday’s trading session ended with a gain of 7.62% for the shares, while pre-market trading indicates an increase of over 6% to $8.06 per share.

 

The Marathon Digital Revenue Scandal and Its Relation to the Silvergate Scandal

Also, Marathon Digital has disclosed the nature of its exposure to the cryptocurrency-focused institution Silvergate Bank, which is no longer in business. The company claims that it had a loan deal with the bank in the past, but that it ended the arrangement after the bank had recent difficulties.

According to a statement released (1) by the company’s Chief Executive Officer Fred Thiel, “in February 2023, we terminated our credit facilities with Silvergate Bank, which resulted in the release of 3,132 bitcoin that were previously held as collateral.” In view of the recent events that have transpired with Signature Bank, we are also working toward establishing ties with other banks.

Marathon Digital nonetheless managed to establish an amazing Bitcoin output metric despite the many problems it has been having with its finances and performance.

According to the information provided by the corporation, its output of Bitcoin increased by 42% during the fourth quarter and by 30% throughout the entire year.

In terms of numbers, the overall amount of Bitcoin mined in the fourth quarter was 1,562, while the total amount mined for the entire year was 4,144.

The company may have gotten off to a better start this year for the company, but in order to compensate for some of its outstanding obligations, the company has already sold all of the Bitcoins that it mined in February.

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