Riot Platforms Q2 Earnings Expected to Reflect Weaker Bitcoin-Mining Economics

Riot Platforms is set to report its second-quarter earnings on August 5. The company's results are expected to show a year-over-year decrease in revenues and earnings per share (EPS). In the previous quarter, Riot reported a loss of $1.44 per share, wider than the Zacks Consensus Estimate of a loss of 33 cents.

The results were impacted by non-cash mark-to-market losses on Riot's Bitcoin holdings, as well as elevated depreciation and amortization expenses. Over the past four quarters, Riot's EPS has surpassed the Zacks Consensus Estimate twice but missed in the remaining period, with an average miss of -130.56%.

The company's use of Bitcoin sales to fund capital expenditures may have reduced its digital-asset holdings. Higher operating and maintenance costs related to the AMD capacity ramp-up, coupled with lower-margin tenant fit-out revenues, are also likely to have weighed on consolidated profitability.

However, the May delivery of the remaining 20 megawatts under the initial AMD lease is expected to have boosted high-margin operating lease revenues during the quarter. Ongoing tenant fit-out activity, power-curtailment credits, and efficient electricity management may have provided additional support.