Jim McIlree

Jim McIlree asked about the economic viability of CleanSpark's miner fleet at current Bitcoin prices, specifically what percentage remains profitable. He also requested details on CapEx plans for the current and next year, including the allocation between Bitcoin mining and HPC.

Answer

Matt Schultz, Chairman and CEO, stated that less than 10% of CleanSpark's miner fleet is unprofitable at the current hash price, with the vast majority remaining profitable. Gary Vecchiarelli, President and CFO, outlined CapEx plans, emphasizing that the overwhelming majority of capital will be deployed towards AI data centers, with an estimated cost of $9M-$11M per megawatt. He noted that significant new investment in Bitcoin mining equipment is not currently planned due to unfavorable economics and the approaching halving, though existing prepaid deposits will be used for efficiency improvements.

Jim McIlree asked how much of CleanSpark's miner fleet is economic to operate at current Bitcoin prices (around $63,000) or meets the hurdle rate. He also inquired about CapEx plans for this year and next, both in dollar terms and allocation between Bitcoin and HPC.

Answer

Matt Schultz (Chairman and CEO, CleanSpark) stated that less than 10% of their fleet is unprofitable at current hash prices, with the majority being profitable, and less efficient machines can be unplugged. Gary Vecchiarelli (President and CFO, CleanSpark) explained that CapEx will overwhelmingly focus on AI ($9M-$11M per megawatt), with minimal new investment in Bitcoin mining unless economics significantly change, redirecting capital towards AI CapEx.

Jim McIlree asked if Sandersville is the only existing mining site identified for critical IT applications or the first of many. He also inquired if the switch from mining to AI at Sandersville could occur before the Sealy facility is energized, and whether CleanSpark would need to sell all its Bitcoin production to cover increased expenses given recent Bitcoin prices.

Answer

Matt Schultz, Chairman and CEO of CleanSpark, confirmed Sandersville is the first, with other Metro Atlanta and Tennessee sites also in high demand for AI. He explained that new AI construction would happen on adjacent land at Sandersville while mining continues, allowing a 'flip the switch' when ready, potentially before Sealy's 2027 energization. Schultz stated CleanSpark would not need to sell all Bitcoin production, citing 50-55% gross margins, a healthy cash stack, and $400 million in Bitcoin-backed credit, emphasizing a hybrid approach and the company's fleet efficiency advantage.

Jim McIlree asked if Sandersville is the only existing mining site identified for critical IT applications or the first of many, and if the transition from mining to AI at Sandersville could occur before the Sealy facility is energized. He also inquired if increased expenses and recent Bitcoin prices would necessitate selling the entirety of CleanSpark's Bitcoin production to cover costs.

Answer

Chairman and CEO Matt Schultz confirmed Sandersville is the first, with other Metro Atlanta sites and some Tennessee locations also in high demand for HPC/AI. He explained that Sandersville has adjacent land for new construction, allowing for parallel mining and a rapid 'flip the switch' transition to compute, potentially before Sealy is energized. Regarding Bitcoin sales, Mr. Schultz stated 'not at all,' citing 6,700 Bitcoin generated monthly at 50-55% gross margin, a healthy cash stack from the $1.15 billion bond, and $400 million in Bitcoin-backed credit facilities, indicating a hybrid approach rather than selling the entire stack.