BitDeer turns losses into profits, focusing on AI cloud services and proprietary mining equipment

Mining company Bitdeer has released its financial report for the first quarter, showing a 64.6% year-on-year increase in total revenue. It has finally turned a profit with a net profit of $600,000. The company's mining business has mined 911 bitcoins, a 65% increase from the same period last year. However, its stock price seems to be struggling, with Bitdeer's stock price down 48% year-to-date.

Revenue Increases by 64.6%, Net Profit of $600,000

In the first quarter, Bitdeer's total revenue increased by 64.6%, with self-mining revenue accounting for 42% at $48 million, higher than the $13.2 million in the same period last year. This increase is mainly due to the launch of the Bhutan center in the second half of 2023 and the higher average bitcoin price this year compared to the first quarter of 2023.

Cloud computing power remained almost the same as last year but remains Bitdeer's highest-margin product line.

Bitdeer continues to increase its hosting revenue, as it has high and stable margins that are less affected by bitcoin prices.

Bitdeer finally achieved a net profit in the first quarter, albeit only $600,000, a significant improvement from the net loss of $9.5 million in the same period last year.

High Profit Margin in AI Cloud Services

In November last year, Bitdeer became a recommended cloud service provider in NVIDIA's partner network and launched Bitdeer AI Cloud, providing users with access to NVIDIA AI supercomputing for accelerated AI generation, large language models (LLM), and other AI developments related to computing power.

From the financial report, it is evident that cloud computing power is Bitdeer's highest-margin product line, with potential for continued growth through the expanding demand for AI.

Self-Developed Mining Chips and Equipment

In March, Bitdeer announced the launch of its first cryptocurrency mining chip, SEAL01, using advanced 4-nanometer technology, which will be seamlessly integrated into its upcoming mining equipment, SEALMINER A1.

Bitdeer has assembled an international team specializing in chip design, firmware, and hardware engineering to support the bitcoin mining community post the 2024 halving event, aiming to provide a one-stop solution for bitcoin mining.

SEALMINER A1 is expected to begin trial production in May. By deploying the trial-produced mining machines in data centers for self-mining, on-site testing can ensure stability and provide customers with the best product quality. Meanwhile, the team continues to develop next-generation mining equipment. Orders for mass-produced wafers may start in the third quarter of this year, expected to offer higher efficiency.

Bitdeer Stock Price Down 48% Year-to-Date

Since its successful listing through a reverse merger in April last year, Bitdeer's stock price has remained consistently below the issue price. Despite multiple stock buyback programs, the impact on the stock price has been limited. Additionally, as Bitdeer does not accumulate bitcoins as part of its operations and typically sells what it mines, it does not hold a significant amount of bitcoin, hence not benefiting from bitcoin's price increase.

Although Bitdeer has delivered a decent performance, its stock price has not been impressive, down 48% year-to-date.