HIVE Digital Technologies Ltd. Q1 FY2025 earnings call

Global Presence

• Operates in 9 time zones, 4 languages, with facilities in multiple jurisdictions including Switzerland, Sweden, Iceland, Canada, Bermuda, Texas, and expanding to Paraguay.

Green Energy Focus

• Sourcing green energy, planning a 100 MW hydroelectric data center in Paraguay to double hash rate and revenue.

Financial Performance

• Q1 2025 revenue: $32.2 million; adjusted EBITDA: $14.9 million; net income: $0.03 per share (vs. net loss $0.19 per share in Q1 2024).

AI Strategy

• Repurposing GPU chips for AI, with $10 million annualized ARR from GPU leasing, aiming to expand to $20 million in H2 2024 and $100 million annually by next year.

In Q1 2025, HIVE Digital Technologies' Bitcoin mining segment generated $32.2 million in revenue and $14.9 million in adjusted EBITDA, with 449 BTC equivalent mined. The Bitcoin price increase from $30,000 a year ago to $60,000 contributed to revenue growth. The AI/GPU business achieved $10 million in annualized run rate revenue in Q1 2025, with a target of $20 million for the second half of 2024 and $100 million annually by next year.

Paraguay Expansion

• Plans to build a 100 MW hydroelectric data center in Paraguay, targeting to double hash rate capacity from 5.5 exahash to 12.1 exahash by Q3 2025.

AI Revenue

• Target to reach $20 million annualized ARR in H2 2024 and $100 million annually by next year from AI/GPU business.

Valuation

• Trading at an enterprise value of $154 million with Q1 adjusted EBITDA of $14.9 million, offering attractive multiples compared to peers.

Market Volatility

• Bitcoin price volatility causes significant daily operations and financial impacts; external factors like geopolitics, geoeconomics, and Bitcoin price fluctuations contribute to volatility.

Energy Sourcing

• Difficulty in sourcing reliable green energy, though Paraguay expansion aims to address this.

Competition

• Peers with different cost structures and market valuations may affect HIVE's competitive position.

Q: Which sites will be converted to HPC from Bitcoin mining?

A: Sites in New Brunswick and Boden, with retrofit timelines of 9-12 months, leveraging existing infrastructure for Tier 3 uptime.

Q: Cadence of Paraguay hash rate ramp-up?

A: High voltage and substation work in first six months, hash rate expected to start coming online in Q3 2025.

Q: Demand for HPC customers?

A: Larger customers wait for project progress before pre-leases; focus on scheduling and matching hardware iterations for optimal fit.

Q: Sustainability of GPU market prices?

A: GPUs have economic life cycles; HIVE focuses on uptime (Tier 3 99.998% uptime) to maintain competitiveness, with long-term contracts for H100s in $2.20-$2.50 per hour range.