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Cipher Mining Inc. (CIFR)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue rose 16% quarter over quarter to $49.0m, driven by higher average Bitcoin prices and Odessa fleet upgrades; GAAP net loss was $39.0m due to a $20m unrealized Bitcoin mark-to-market loss and higher depreciation from new rigs .
  • Adjusted earnings fell to $6.1m ($0.02/share) from $50.5m in Q4 2024 as non‑cash items reversed vs prior quarter (Bitcoin MTM, depreciation), despite stronger top line .
  • Operationally, Cipher accelerated Black Pearl Phase I: immediate redeployment of inventory rigs targets ~2.5 EH/s in Q2, lifting total self-mining hashrate to ~16.0 EH/s by Q2 and ~23.1 EH/s by Q3; signed a term sheet with Fortress Credit Advisors as Barber Lake JV financing partner for HPC development .
  • Treasury management outperformed “hold BTC” by 16% and daily liquidation by 2%; unlocked ~$90m liquidity via hedges/forwards/loans, supporting growth without equity dilution .

What Went Well and What Went Wrong

What Went Well

  • Accelerated Black Pearl deployment: “bring approximately 2.5 EH/s online one quarter earlier… at no additional capital expenditure” and path to ~16.0 EH/s in Q2, ~23.1 EH/s in Q3 .
  • Barber Lake financing secured: term sheet with Fortress to “unconditionally backstop” data center build; optionality to own up to 49% of JV economics without incremental equity, enabling tenant discussions with hyperscalers .
  • Treasury strategy: actively managed hedging and deliverable forwards lifted effective spot to ~$95,991/BTC and unlocked ~$90m liquidity; strategy outperformed hold/daily liquidation benchmarks .

What Went Wrong

  • GAAP loss from non-cash items: $20.2m unrealized loss on Bitcoin inventory given quarter-end spot decline, plus first full quarter depreciating new Odessa machines, driving $43.5m D&A .
  • Adjusted earnings compression: adjusted net fell to $6.1m vs $50.5m in Q4 and $63.0m in Q1 2024 as non-cash tailwinds reversed YoY (prior year included ~$41m unrealized Bitcoin gains) .
  • JV site costs and impairment: JV electricity costs remain higher and seasonally variable; equity in losses reflected a non‑cash impairment charge at Alborz JV rigs .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$24.1 $42.2 $49.0
GAAP Net Income ($USD Millions)$(86.8) $17.5 $(39.0)
GAAP Diluted EPS ($USD)$(0.26) $0.05 $(0.11)
Adjusted Earnings ($USD Millions)$(3.4) $50.5 $6.1
Adjusted Diluted EPS ($USD)$(0.01) $0.14 $0.02
Consensus Revenue (S&P Global)N/A*N/A*N/A*
Consensus EPS (S&P Global)N/A*N/A*N/A*

Values with asterisk: Consensus estimates unavailable via S&P Global at time of retrieval. Values retrieved from S&P Global.

Segment/KPI overview:

KPIQ3 2024Q4 2024Q1 2025
BTC Mined (units)396 492 602
Self‑Mining Hashrate (EH/s)9.3 (quarter end) ~13.5 (post-upgrade) ~13.5 (current)
Fleet Efficiency (J/TH)~18.9 YE target ~17.6 Odessa post‑upgrade 18.9 overall
Weighted Avg Power Price (c/kWh)~2.7 ~2.7 2.7
All‑in Electricity Cost per BTC ($USD)$25,488 (Odessa post‑halving) $20,298 (Odessa Jan) $23,379 (Q1 combined)
Cash & Cash Equivalents ($USD Millions)$25.3 $5.6 $23.2
Bitcoin on Balance Sheet ($USD Millions)$95.5 $92.7 $52.0

Explanatory notes:

  • Q1 revenue uplift reflects average BTC price rising to ~$93k from ~$83k in Q4 and Odessa production gains; GAAP loss driven by quarter-end spot decline (unrealized loss) and higher depreciation from new rigs .
  • Cost of revenue decreased 18% sequentially due to less curtailment/power purchases vs Q4; Odessa fixed-price PPA remains core cost advantage .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Black Pearl Phase I energizationQ2 2025On track to energize Q2 2025; Phase I to generate >~9.5 EH/s Energization expected ahead of schedule; immediate redeployment to deliver ~2.5 EH/s in Q2 and ramp to ~9.6 EH/s in Q3 Raised/accelerated deployment
Total self‑mining hashrateEnd Q2 2025N/A~16.0 EH/s New target introduced
Total self‑mining hashrateEnd Q3 2025≥23 EH/s (2025 plan) ~23.1 EH/s Maintained/refined
Barber Lake financing2025In discussions with financing partners; 500 MW MOU adjacent expansion Term sheet signed with Fortress as JV financing partner; site energized and ready; MOU for additional 500 MW remains Raised clarity/derisked
Tariffs/rig deliveries2025N/AMonitoring tariff landscape; working with rig vendors; base case assumes 10% non‑China tariff Risk identified/mitigation in progress

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024 and Q4 2024)Current Period (Q1 2025)Trend
AI/HPC initiativesPivot to HPC developer model; Barber Lake acquisition and tenant interest; MOU for +500 MW expansion; SoftBank $50m PIPE Fortress JV financing term sheet; multiple tenants under NDA/data rooms; optionality for HPC at Black Pearl Phase II Intensifying; financing de-risked; tenant pipeline advancing
Supply chain/tariffsLimited detailNavigating tariff volatility; aiming to mitigate via vendor terms; assuming 10% non‑China tariff baseline Manageable risk; proactive mitigation
Treasury managementBTC sales funded Barber Lake; PPA derivative asset marks swung (Q3 down, Q4 up) 9.6% avg hedged; effective spot ~$95,991; +$90m liquidity unlocked; +16% vs hold, +2% vs daily liquidation Strong outperformance; supports growth
Power/PPA valueQ3: large markdown; Q4: +$11m gain; value ~$86m Upward shift in forward curve; PPA valued ~$93m Positive sequential move
Operational executionOdessa upgrade to ~13.5 EH/s; Q4 revenue +75% QoQ; cost of revenue up due to power purchases during curtailment Q1 revenue +16% QoQ; BTC mined +3%; cost of revenue −18%; D&A +20% QoQ; JV equity losses include non‑cash impairment Top line improving; non‑cash headwinds
Regulatory/macro (ERCOT)—Texas queue reforms likely; scrutiny of behind‑the‑meter charges; benefits holders of large interconnects Tightening environment favors existing capacity

Management Commentary

  • “The first quarter was marked by disciplined execution and steady progress as we advanced our 2025 expansion plans… partnered with Fortress… to develop a next‑generation data center at Barber Lake.” — Tyler Page, CEO .
  • “We are nearing completion of the Black Pearl Data Center’s Phase I… deploy rigs from inventory… bring ~2.5 EH/s online… one quarter earlier… at no additional capital expenditure.” — Tyler Page, CEO .
  • “For the quarter, we reported a GAAP net loss of $39m… adjusted earnings of $6m… bottom line results were impacted by higher depreciation… and a $20m unrealized mark‑to‑market loss on our Bitcoin holdings.” — Edward Farrell, CFO .
  • “Our strategy outperformed simply holding Bitcoin by 16% and outperformed daily liquidation by 2%… improved our effective spot price to nearly $96,000 per Bitcoin… unlocked $90m in liquidity.” — Tyler Page, CEO .

Q&A Highlights

  • Fortress JV structure/economics: JV backstops full build; Cipher can own up to 49%, contribute site assets, and target ~40% of economics “without contributing a dollar of capital,” subject to tenant terms and market exit returns .
  • Tariff mitigation: Deliveries scheduled near term; discussions with manufacturers to share burden; base assumption ~10% non‑China tariff; confident in meeting projections .
  • HPC timeline/lead times: Barber Lake energized substation accelerates build; generator availability gates 5‑9s uptime; late‑2025 operation possible depending on tenant specs; other models leverage tenant equipment inventory .
  • Site interest beyond Barber Lake: Stingray attracting enterprise-type HPC interest at 100 MW; Reveille flexible for smaller tenants/multi‑tenant colocation in 2027 .
  • ERCOT queue reforms: More “skin in the game” to trim speculative interconnect requests; likely increases scrutiny and boosts value of Cipher’s approved large interconnects .

Estimates Context

  • We attempted to retrieve Wall Street consensus (S&P Global) for Q1 2025 revenue and EPS; data was unavailable across Q1 2024, Q4 2024, and Q1 2025. As such, we cannot determine beat/miss vs consensus for the quarter. Values retrieved from S&P Global.

Where estimates may need to adjust:

  • Non‑cash volatility (Bitcoin MTM, PPA marks) and accelerated depreciation materially swing GAAP results; core operating drivers (BTC price, network hash, curtailment dynamics) and accelerated Black Pearl deployment suggest upward adjustments to operational throughput metrics rather than near‑term GAAP EPS, pending Bitcoin spot trajectory and depreciation cadence .

Key Takeaways for Investors

  • Near‑term capacity catalysts: Black Pearl Phase I early redeployment should add ~2.5 EH/s in Q2, lifting total self-mining to ~16.0 EH/s by Q2 and ~23.1 EH/s by Q3; a visible driver of revenue/production into 2H 2025 .
  • HPC financing de-risked: Fortress JV term sheet materially strengthens Barber Lake’s bankability and tenant appeal; expect increased momentum toward a long‑term lease that can be financed at attractive rates .
  • Treasury execution offsets commodity volatility: Active hedging and deliverable forwards supported ~$90m liquidity and superior price realization; continued discipline reduces capital needs amid expansion .
  • Watch non‑cash GAAP drivers: D&A step‑up from Odessa upgrade and quarter‑end Bitcoin marks can mask operating strength; adjusted earnings better reflect operational trends (still compressed this quarter) .
  • Regulatory tailwinds: ERCOT queue tightening and behind‑the‑meter scrutiny likely increase scarcity value of Cipher’s large energized interconnects, favoring lease negotiations and site valuations .
  • Tariff risk manageable: Vendor engagement and schedule adjustments aim to limit impact; deliveries assumed under 10% non‑China tariff baseline .
  • Additional strategic power optionality: Preliminary ENGIE agreement contemplates up to 300 MW of clean wind power for a Texas data center, potentially improving cost/curtailment profile over time .

Additional Relevant Press Releases (Q1 timeframe)

  • $50m PIPE investment from SoftBank to support HPC data center development, adding strategic capital and signaling confidence in Cipher’s HPC strategy .
  • March 2025 operations update showed consistent production and progress at Black Pearl; end‑March operating hashrate 13.5 EH/s; BTC held ~$1,034 (incl. collateral) .