CoinDesk
Cipher Digital reported a $31.6 million third-quarter profit even as revenue fell 63% year over year to $26.7 million. A $127.2 million noncash gain tied to warrants issued to Google helped offset a $71.9 million operating loss, which widened from $37.6 million a year earlier.
Why it matters
The headline profit does not reflect cash generated by Cipher's operations. Adjusted EBITDA fell to negative $10 million from positive $40.8 million a year earlier, while bitcoin mining revenue dropped 71% to $20.8 million as the company redirected capacity toward AI data centers.
Cipher recorded its first data center revenue, collecting $5.9 million after the initial phase of its Black Pearl site in Texas began operating in August. The company had stopped mining Bitcoin at that facility in February as it prepared the site for its new tenant.
Market impact
The results show the cost of Cipher's transition: mining revenue is shrinking, the operating loss is growing, and the new data center business is only beginning to contribute. The $127.2 million warrant revaluation gain is noncash and should be distinguished from operating performance.
Cipher has extended its Barber Lake data center lease to 20 years, bringing contracted revenue at that site to approximately $9.1 billion. That long-term figure signals the scale of the company's AI infrastructure bet, but the quarter's losses and early data center revenue show the transition is still underway.
Frequently asked questions
-
Why did Cipher report a profit despite its operating loss?
A $127.2 million noncash gain tied to warrants issued to Google helped offset Cipher's $71.9 million operating loss, resulting in a reported quarterly profit of $31.6 million.
-
How much did Cipher's revenue fall in the third quarter?
Revenue fell 63% year over year to $26.7 million from $71.7 million.
-
How much revenue did Cipher's new data center business generate?
Cipher recorded $5.9 million in data center revenue after the initial phase of its Black Pearl site in Texas began operating in August.
-
What happened to Cipher's Bitcoin mining revenue?
Bitcoin mining revenue fell 71% to $20.8 million as Cipher shifted capacity toward leasing data centers to AI companies.
-
What is the scale of Cipher's Barber Lake lease?
Cipher extended the Barber Lake data center lease to 20 years, bringing contracted revenue at the site to approximately $9.1 billion.
CoinTelegraph
WatcherGuru
Crypto News
TheBlock
WuBlockchain