HIVE Digital TechnologiesHIVE

Key highlights

• Bitcoin mining output surge: The company mined 2,885 Bitcoin during the full year, a 104% increase over the 1,414 Bitcoin produced last year. This growth was driven by a massive expansion in hardware power, which increased four-fold to 25.1 exahash per second.
• Cloud computing revenue record: High performance computing revenue, which is money earned from renting out powerful chips for AI and research, grew 94% to a record $19.5 million this year. This side of the business now generates $35 million in steady annual contracts after adding a new cluster of high-end Nvidia chips.
• Profitability pressure in Q4: The company reported an adjusted loss of $9 million for the final quarter, a sharp drop from the $5.7 million profit it made just three months earlier. This happened because the price of Bitcoin fell 27% while the difficulty of mining it continued to rise to record levels.
• Ambitious data center roadmap: Management expects to hit $660 million in annual computing revenue by the end of 2028, anchored by a new 320 megawatt site in Toronto. This project is designed to hold 100,000 specialized chips and would represent one of the largest privately owned AI facilities in Canada.
• Liquidity and funding boost: The company raised $115 million through a specialized debt deal that carries 0% interest and can be converted into shares later. These funds will be used to pay for the expansion in Paraguay and build out its growing AI infrastructure pipeline.

Our take: This was a tough quarter where the high costs of building out new data centers met a sharp drop in Bitcoin prices. While the 158% yearly revenue growth is impressive, the company is still losing significant money on a reported basis. The long term case depends entirely on whether they can successfully pivot into the $660 million AI computing target by 2028.