Riot Platforms, Inc. Q4 FY2024 earnings call

• Key Accomplishments 2024: Energized the 400-megawatt Corsicana Facility with ~14 exahash of self-mining hash rate; retained all mine Bitcoin for a nearly 40% Bitcoin yield in 2024; issued convertible senior notes to lower cost of capital and acquire Bitcoin; acquired Block Mining (60 MW mining ops with expansion to 305 MW) and E4A Solutions ($52M cash, 50 employees, $28.2M 2024 revenue).
• Treasury Strategy: Holds all self-mined Bitcoin; aims to minimize dilution; plans $198M in 2025 capital expenditures to reach 38.4 exahash hash rate by year-end.
• AI/HPC Opportunity: Positioned power assets (Corsicana, Rockdale) for AI/HPC uses; engaged Altman Solon to study Corsicana for AI/HPC; added independent directors with data center expertise; engaged Evercore/Northland as financial advisors for AI/HPC partnerships.

Bitcoin Mining: In 2024, Bitcoin mining revenue totaled $321 million, a 70% increase from 2023's $189 million. Bitcoin mining cost of revenue included power costs ($33,281 per Bitcoin, 79% of total) and direct non-power costs ($8,730 per Bitcoin, 21% of total). Engineering Business: In 2024, engineering revenue was $38.5 million, down from $64.3 million in 2023. However, the acquisition of E4A Solutions in December 2024, which generated $28.2 million in 2024 revenue and $4.6 million in EBITDA, is expected to bolster the engineering business with higher-margin recurring services revenues.

• 2025 expects hash rate to grow 22% to 38.4 exahash via Kentucky facility expansion.
• Focus on AI/HPC opportunities to utilize power assets, with discussions ongoing with hyperscalers.
• Aim to maximize value of energy assets through AI/HPC partnerships and retain low-cost power strategy.

• Market volatility affecting Bitcoin price and AI/HPC demand.
• Regulatory changes impacting Bitcoin mining and AI/HPC operations.
• Competition in AI/HPC sector reducing margins and opportunities.
• Delays in power infrastructure development or AI/HPC deal closures affecting financial projections.

Q: Greg Lewis asked about whether the HPC window is widening, with power available in further out years.

A: Jason Les responded that power is valuable in 2025 and beyond, as transmission and substation items take 4-5 years, making capacity in 2025 premium but future power also valuable.

Q: Nick Giles inquired about Corsicana's land capacity and Rockdale as an HPC campus.

A: Jason Les stated Corsicana has 1 gigawatt interconnect and land being expanded, Rockdale has 700 MW substation, and both sites are being evaluated for AI/HPC use based on demand.

Q: Darren Aftahi asked about Rockdale being flipped to HPC and Corsicana land procurement.

A: Jason Chung replied Rockdale could be flipped if economics and interest align, and Corsicana is procuring hundreds of acres for optionality.

Q: Reggie Smith asked about SG&A trends and employee count.

A: Jason Les noted SG&A was elevated due to one-time M&A and litigation costs, with 783 employees, and expects cash SG&A to be $30M-$33M run-rate post one-offs.

Q: John Todaro asked about complementarity of Bitcoin and AI/HPC and market perception.

A: Jason Les stated Bitcoin growth funded assets for AI/HPC, and both sectors are complementary with Bitcoin providing capital for AI/HPC opportunities.