Q4 2024 LM Funding America Inc Earnings Call
Operator: Good day, and thank you for standing by.
Good day, and thank you for standing by.
Operator: Welcome to the LM Funding America fourth quarter and full year 2024 conference call. At this time, all participants are in a listen-only mode.
Welcome to the L. M funding America fourth quarter and full year 2024 conference call. At this time, all participants are in a listen only mode.
Operator: After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again.
After the speaker's presentation, there will be a question and answer session to.
To ask a question during the session you will need to press star one one on your telephone you will then hear an automated message advising your hand is raised to withdraw your question. Please press star one again.
Operator: Please be advised that today's conference is being recorded.
Please be advised that today's conference is being recorded.
Cody Fletcher: I would now like to hand the conference over to your speaker today, Cody Fletcher, Investor Relations. Please go ahead. Thank you, operator. And thank you all for joining LM Funding America's fourth quarter and full year 2024 earnings conference. Joining us today are Chairman and CEO Bruce Rodgers, President of U.S. Digital Mining, Ryan Duran, and CFO Richard Russell.
Speaker Change: I would now like to hand, the conference over to your Speaker today Cody Fletcher Investor Relations. Please go ahead.
Speaker Change: Thank you operator, and thank you all for joining Alan funding America's fourth quarter and full year 2024 earnings conference call joining.
Bruce Rogers: Joining us today are chairman and CEO Bruce Rogers.
Speaker Change: <unk> digital mining Brian Doran.
Cody Fletcher: For today's call, we've uploaded an accompanying supplemental investor presentation, which can be found under the events section of LM Funding's Investor Relations website.
Richard: CFO Richard.
Speaker Change: For today's call, we've uploaded and accompanying supplemental investor presentation, which can be found under the events section of our loan fundings Investor Relations website.
Cody Fletcher: Before we get started, please note that our remarks today may include forward-looking These statements are subject to risks and uncertainties, and actual results may differ materially. We will also reference certain non-GAAP financial measures today. Please refer to our 10-K filing and our website for a full reconciliation of these non-GAAP performance measures to the most comparable GAAP measures.
Speaker Change: Before we get started please note that our remarks today may include forward looking statements.
Speaker Change: These statements are subject to risks and uncertainties and actual results may differ materially.
Speaker Change: We will also reference certain non-GAAP financial measures today, please refer to our 10-K filings and our website for a full reconciliation of these non-GAAP performance measures to the most comparable GAAP measures.
Cody Fletcher: For a more comprehensive discussion of these and other risks, please refer to our filings with the SEC available on www.sec.gov and then the investor section of our website at www.lmfunding.com backslash investor.
Speaker Change: For a more comprehensive discussion of these and other risks please refer to our filings with the SEC available on Www SEC Gov and at the investors section of our website at Www Dot.
Speaker Change: And funding Dot com backslash investors.
Bruce Rodgers: I'll now turn the call over to our CEO, Bruce Rodgers, Bruce. Thanks, Cody. Good morning. And thanks for joining us today. Since we entered the Bitcoin mining business in 2021, LM Funding has steadily advanced our strategy to become a successful participant in the digital asset sector. Our early focus was on an asset light model to minimize initial capex by leveraging third-party hosting arrangements while we gain market insights and establish our operational footprint. Last year, through careful planning and execution, we transitioned to a vertically integrated model, one where we manage the infrastructure ourselves, ensuring better margins and mitigating risks associated to third party hosting agreements.
Speaker Change: I'll now turn the call over to our CEO Bruce Rogers Bruce.
Speaker Change: Cody good morning, and thanks for joining us today.
Speaker Change: Since we entered the bitcoin mining business in 2021 L. M funding has steadily advanced our strategy come a successful participant in the digital asset sector.
Speaker Change: Our early focus was on an asset light model to minimize initial capex by leveraging third party hosting arrangements, while we gain market insights and established our operational footprint.
Speaker Change: Last year through careful planning and execution, we transitioned to a vertically integrated model, one where we manage the infrastructure ourselves ensuring better margins and mitigating risks associated with third party hosting agreements.
Bruce Rodgers: Today we own and directly manage our mining infrastructure with our inaugural 15 megawatt site in Oklahoma. This vertical integration reduces our fleet wide energy costs and improves our operations for enhanced uptime and mining efficiency. Throughout our expansion, we have continued our commitment to disciplined OPEX control. By actively maintaining a low cost structure from power sourcing and infrastructure investments to staffing and equipment, we were able to successfully navigate a challenging year for the industry and our first Bitcoin halving event, which occurred in April 2024. This strategic cost control enabled us to achieve profitability in 2024 on a core EBITDA basis, as well as retain more Bitcoin on our balance sheet, which is a significant piece of our long term strategy.
Speaker Change: Today, we own indirectly manage our mining infrastructure with our inaugural 15 megawatt site in Oklahoma.
Speaker Change: This vertical integration reduces our fleet wide energy costs and improves our operations for enhanced uptime and mining efficiency.
Speaker Change: Throughout our expansion we have continued our commitment to disciplined opex control.
Speaker Change: Maintaining a low cost structure from power sourcing and infrastructure investments to staffing and equipment, we were able to successfully navigate a challenging year for the industry and our first bitcoin, having events, which occurred in April 2024.
Speaker Change: This strategic cost control enabled us to achieve profitability in 2024 on our core EBITDA basis, as well as retain more bitcoin on our balance sheet, which is a significant piece of our long term strategy.
Bruce Rodgers: By retaining a portion of our mined Bitcoin, we not only capture potential upside for our shareholders, but also deepen our alignment with the broader Bitcoin industry. This approach, combined with selective financing during advantageous market windows, helps us maximize value and ensure sufficient liquidity to fund future expansion. In terms of our financial and operational highlights, in 2024, we mined 170.6 Bitcoin, which generated approximately $11 million of revenue and $3.9 million in core EBITDA. This represents strong growth on the bottom line as well as steadily growing our Bitcoin HODL balance to 150.2 Bitcoin at the end of December 2024 from 95.1 Bitcoin at the end of December 2023.
Speaker Change: By retaining a portion of our mine bitcoin, we not only capture potential upside for our shareholders, but also deepen our alignment with the broader bitcoin industry.
Speaker Change: This approach combined with selective financing during advantageous market windows helps us maximize value and ensure sufficient liquidity to fund future expansion.
Speaker Change: In terms of our financial and operational highlights and 2024, we mined 170.6, bitcoin, which generated approximately $11 million of revenue and $3 9 million and core EBITDA.
Speaker Change: This represents strong growth on the bottom line as well as steadily growing our bitcoin hobbled balance to 150 point to bitcoin at the end of December 2024 from $95. One bitcoin at the end of December 2023.
Bruce Rodgers: at the end of February 25. We expanded our total energized hash rate to 560 petahash per second. And we held 165.8 Bitcoin on our balance sheet, which equates to approximately $2.81 per share as of Wednesday the 26th. We believe our current market cap relative to our Bitcoin holdings presents compelling value. As of March 26, our share price of $1.49 per share reflects a market cap of $7.6 million. Yet our Bitcoin holdings alone are valued at $14.4 million, or $2.81 per share. This nearly 2x disparity between our market cap and Bitcoin holdings demonstrates a compelling opportunity, in our opinion, and values us at significant discount to our Bitcoin mining peers.
Speaker Change: At the end of February 25.
Speaker Change: We expanded our total energized cash rate to 560 <unk> per second.
Speaker Change: The 165, H bitcoin on our balance sheet, which equates to approximately $2 81 per share as of Wednesday, the 26th.
Speaker Change: We believe our current market cap relative to our Bitcoin holdings presents compelling value.
Speaker Change: As of March 26, our share price of $1 49 per share reflects a market cap of $7 $6 million.
Speaker Change: Yet our bitcoin holdings alone are valued at $14 4 million or $2 81 per share.
Speaker Change: This nearly two X disparity between our market cap and Bitcoin holdings demonstrates a compelling opportunity in our opinion and values us at significant discount to our bitcoin mining peers as.
Bruce Rodgers: As we look forward to 2025, our emphasis on vertical integration, discipline cost management, strategic infrastructure expansion, and strong Bitcoin treasury remain crucial to our success. Our lean operations and strengthened balance sheet position us to capitalize on the evolving Bitcoin mining landscape. We plan to invest in next generation mining hardware, energy efficiency initiatives, and strategic site acquisitions to grow our company.
Speaker Change: As we look forward to 2025, our emphasis on vertical integration disciplined cost management strategic infrastructure expansion and strong bitcoin treasury remains crucial to our success, our lean operations and strengthened balance sheet.
Speaker Change: US to capitalize on the evolving bitcoin mining landscape.
Speaker Change: We plan to invest in next generation mining hardware energy efficiency initiatives and strategic site acquisitions to grow our company.
Ryan Duran: I'll now turn the call over to Ryan Duran, President of U.S. Digital Mining to review our operational highlights in more detail. Ryan. Thank you, Bruce. The fourth quarter of 2024 was marked by significant operational achievements that support our ongoing vertical integration strategy. Notably, we acquired a 15 megawatt mining facility in Oklahoma, which represents a major step forward in our efforts to control our mining infrastructure. In line with our focus on operating efficiency, we placed orders for 256 new Bitmain S21 Plus mining machines. With these new generation miners, we're aiming to improve our fleet efficiency, enabling us to mine more Bitcoin at a lower cost per coin.
Speaker Change: I'll now turn the call over to Ryan our President of U S digital mining.
Brian: Our operational highlights in more detail Brian.
Brian: Thank you Bruce the fourth quarter of 2024 was marked by significant operational achievements that support our ongoing vertical integration strategy, notably we acquired a 15 megawatt mining facility in Oklahoma, which represents a major step forward in our efforts to control our mining infrastructure.
Brian: In line with our focus on operating efficiency, we placed orders for 256, new bit Maine S 21, plus mining machines with these new generation miners were aiming to improve our fleet efficiency, enabling us to mine more bitcoin at a lower cost per coin.
Ryan Duran: In Q1 2025, we partnered with Luxor Technology Corporation and installed their proprietary LuxOS firmware on our existing fleet. The new firmware will allow us to mine at higher margins and increase profitability without adding more machines or using more power. We expect the benefits from this upgrade to increase our mining efficiency by an overall 10 to 15%. Finally, as Bruce mentioned, we mined 170.6 Bitcoin in 2024 and have mined 16.1 through February 2025.
Brian: In Q1, 2025, we partnered with Luxor Technology Corporation and installed their proprietary Lux Oss firmware on our existing fleet, the new firm, where will allow us to mine at higher margins and increased profitability without adding more machines are using more power.
Brian: We expect the benefits from this upgrade to increase our mining efficiency by an overall, 10% to 15%.
Brian: Finally, as Bruce mentioned, we mined 176 bitcoin in 2024 and of minus 16, one through February 2025.
Ryan Duran: I look forward to providing more updates as we expand in a cost efficient way.
Speaker Change: I look forward to providing more updates as we expand in a cost efficient manner. Our CFO Rick Russell will now provide a review of the financial highlights for the fourth quarter of 2020 for Rick.
Richard Russell: Our CFO Rick Russell will now provide a review of the financial highlights for the fourth quarter of 2024. Thanks, Ryan. For the fourth quarter of 2024, we mined 21.7 bitcoins. The average Bitcoin price in the fourth quarter was approximately $83,000, while the average price for the full year 2024 was approximately $61,000. Total revenue for the fourth quarter of 2024 was approximately $2 million. This compares with $4.1 million for the fourth quarter of 2023.
Speaker Change: Thanks, Ryan for the fourth quarter of 2024, we mined $21 seven bed coins the average bitcoin price during the fourth quarter was approximately $83000, while the average price for the full year 2024 was approximately 61000.
Total revenue for the fourth quarter of 2024 was approximately $2 million.
Speaker Change: This compares with $4 1 million for the fourth quarter of 2023.
Richard Russell: The year over year decrease in revenue primarily reflects the effects of the April 2024 Bitcoin hacking event and moving mining machines into a storage until such machines became active at our Oklahoma site. Our direct mining margins for the fourth quarter were essentially flat to the prior year. We increase our operational efficiency year over year with staff costs, payroll, professional fees, and SGA expenses down 18%.
Speaker Change: The year over year decrease in revenue primarily reflects the effects at the April 'twenty 'twenty, four bitcoin, having events and moving mining machines into a storage until such machines became active at our Oklahoma site.
Speaker Change: Our direct mining margins for the fourth quarter were essentially flat to the prior year.
Speaker Change: We increase our operational efficiency year over year with staff cost payroll professional fees and SG&A expenses down 18%.
Richard Russell: Fourth quarter net income attributable to LM shareholders was $2 million, an over 220% improvement versus a net loss of $1.6 million a year ago. The transition from total revenue to positive net income was primarily driven by the 4.3 million gains on fair value of our Bitcoin holdings, which more than offset operating expenses.
Speaker Change: Fourth quarter net income attributable to <unk> shareholders was $2 million and over two and a 20% improvement.
Speaker Change: The net loss of $1 6 million a year ago.
Speaker Change: The transition from total revenue. It's a positive net income was primarily driven by the $4 3 million gain on fair value of our bitcoin coatings, which more than offset operating expenses.
Richard Russell: Lastly, our core EBIT increased to $3.3 million this quarter, nearly 10x what we generated a year ago.
Speaker Change: Lastly, our core EBIT increased to $3 3 million this quarter.
Speaker Change: <unk>, what we generate a year ago.
Richard Russell: Turning to our balance sheet, I'm pleased to report that our combined cash and Bitcoin holdings increased by 200% in fiscal year 2024. Our cash grew 40% to $3.4 million while our Bitcoin holdings surged over 300% to $14 million. As of December 31, 2024, we held 150.2 Bitcoin. Over 14 million Bitcoin, 5 million sits in a custody account as collateral for the 5 million themed secured loans. We believe our debt financing strategy differentiates us from competitors as we are bullish of Bitcoin's price momentum. which allows us to capitalize on positive arbitrage compared to traditional USD loans.
Speaker Change: Turning to our balance sheet I'm pleased to report that our combined cash and Bitcoin holdings increased by 10% in fiscal year 2024.
Speaker Change: Our cash grew 40% to $3 4 million or a bitcoin holding surged over 300% to $14 million.
Speaker Change: As of December 31, 'twenty 'twenty, four we held 150 point to bitcoin.
Speaker Change: Our 14 million <unk> 5 million sits at Ekati count as collateral for the 590 <unk> secured loan.
Speaker Change: We believe our debt financing strategy differentiate us from competitors as we are bullish a big points price momentum.
Speaker Change: Which allows us to capitalize on positive arbitrage compared to traditional USD loans.
Bruce Rodgers: Bruce will now provide some thoughts on our outlook and strategy heading into 2025. Thanks, Rick. In conclusion, even as a relatively small player in the sector, LM Funding has demonstrated an ability to navigate industry volatility. But the recent having behind us and our vertical integration strategy and practice, we're well positioned to capitalize on the opportunities ahead. Looking ahead, we're focused on greenfield and brownfield power assets in the five to 20 megawatt range, facilities that typically fall below the acquisition thresholds of larger operators. By targeting these opportunities, we continue to scale while maintaining our operational efficiency.
Bruce Rogers: Bruce will now provide some thoughts on our outlook and strategy heading into 2025.
Bruce Rogers: Thanks, Rick and conclusion, even as a relatively small player in the sector L. M funding has demonstrated an ability to navigate industry volatility.
Bruce Rogers: The recent having behind us and our vertical integration strategy in practice, we're well positioned to capitalize on the opportunities ahead.
Bruce Rogers: Looking ahead, we're focused on a greenfield and brownfield power assets in the five to 20 megawatt range facilities that typically fall below the acquisition thresholds of larger operators by targeting these opportunities we continue to scale, while maintaining our operational efficiency.
Bruce Rodgers: Several key advantages underpin this approach are lean cost structure, a healthy balance sheet, the flexibility to leverage Bitcoin backed debt when favorable, and a willingness to pursue mergers and acquisitions aligned with our core objective of efficient Bitcoin. We believe this strategy will foster ongoing growth and generate lasting value for our shareholders.
Bruce Rogers: Several key advantages underpinning this approach our lean cost structure healthy balance sheet flexibility to leverage bitcoin back debt when favorable and a willingness to pursue mergers and acquisitions aligned with our core objectives efficient bitcoin line.
Bruce Rogers: We believe this strategy will foster ongoing growth generate lasting value for our shareholders.
Bruce Rodgers: Thank you for your continued support. We're excited to advance into our next phase of growth and remain committed to driving LM funding toward even greater success in the digital assets phase.
Bruce Rogers: Thank you for your continued support we're excited to advance into our next phase of growth and remain committed to driving Ellen funding toward even greater success in the digital asset space.
Operator: I'll now turn the call over to the operator to take your questions. Thank you, Bruce. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster.
Bruce Rogers: I'll now turn the call over to the operator to take your questions.
Speaker Change: Thank you Bruce as a reminder to ask a question. Please press star one one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one again please.
Speaker Change: Please standby, while we compile the Q&A roster.
Kevin Dede: Our first question comes from the line of Kevin Dede with HC Wainwright. Your line is now open. Good morning, gentlemen. Thanks for hosting the call and having me on it. I appreciate it. I was hoping.
Speaker Change: Our first question comes from the line of Kevin Dede with H C. Wainwright. Your line is now open.
Kevin Dede: Hi, good morning, gentlemen, and thanks for hosting the call and having me on it I appreciate it.
Kevin Dede: Maybe we could just make sure that The current operating stats are straight in my head. I mean, and whether or not that 200 and 56 new machines is included in the 560 pet ad.
Speaker Change: I was hoping.
Kevin Dede: Maybe we could just make sure that.
Speaker Change: The current operating stats.
Kevin Dede: Our straight in my head.
Kevin Dede: And whether or not that 200 and.
Kevin Dede: 56, new machines is included in the 560 potash.
Rick Russell: Kevin, this is Rick. Those new machines have not yet arrived, so they'll be added to it once they're in. you know, and so on. Okay, so are there open sockets within the 15 megawatts? Are you deploying new boxes there? Or are you just going to change out machines?
Greg: Hi, Kevin This is Greg.
Greg: New machines have not yet arrived so there'll be added to it.
Greg: Okay.
Doug: Yeah, Doug.
Doug: Okay. So are there open sockets within that 15 megawatts.
Doug: Are you deploying new boxes, there or are you just going to change out machines.
Rick Russell: We have space to add about two more megawatts there is what we're looking at. Unknown Executive, Ted Ayvas, Richard Russell, LM Funding Unknown Speaker I'm Okay, so then the new machines are going to replace less efficient ones in those sockets then? Is that what you're Well, I'm We're looking to add the two megawatts fairly quickly and just plug it in. Oh, okay. Okay.
Doug: How should we think about that we have base are right well, we have space to add about two more megawatt there is what we're looking at.
Doug: <unk>.
Doug: Per socket right now all of our sockets there are field.
Doug:
Doug: Okay.
Doug: So then.
Doug: The new machines are going to replace less efficient ones and those sockets, then is that what youre thinking well.
Doug: We're looking to add the two megawatts fairly quickly and just plug it in.
Doug: Okay. Okay. Okay.
Rick Russell: What do you think is a good timeline for us to assume that happens? I'm I think, Ryan, do we have a thought on what it would take to get that those two new containers in place. Yes, Rick, we should Kevin, we're looking at groundwork would be about three weeks, and it depends on infrastructure. That's going to be our holdup, but it should be within 90 days, no matter what. Okay, okay. helpful. Thank you, gentlemen. I am.
Doug: What do you think is a good timeline for assume Matt to for us to assume that happens.
Doug:
Doug: I think Ryan do we have a thumb would take to get that.
Doug: Those two new containers in place.
Ryan: Yes, Rick we should.
Kevin Dede: Kevin we're looking at.
Kevin Dede: Groundwork could be about three weeks and it depends on infrastructure. So that's going to be our holdup, but it should be within 90 days no matter what.
Kevin Dede: Okay. Okay.
Speaker Change: Helpful. Thanks, gentlemen.
Kevin Dede: I'm also wondering about opportunities in Texas. So maybe you could spend a little time. Updating us on where those things.
Kevin Dede: I'm also wondering about.
Kevin Dede: Yeah.
Kevin Dede: Yes.
Kevin Dede: No.
Kevin Dede: From time to time.
Kevin Dede: Communities in Texas.
Kevin Dede: So maybe you could spend a little time.
Kevin Dede: Updating us on where those things stand.
Kevin Dede: Okay.
Ryan Duran: Brian, why don't you respond to that? Yeah, Kevin, I'm assuming we're referring to the, well, we've had a couple sites we've looked at in Texas. A couple of LOIs have been presented, none of them currently outstanding right now in the state of Texas.
Kevin Dede: Brian why don't you respond to that.
Kevin Dede: Yes, Kevin I'm assuming.
Kevin Dede: We're referring to be well we've had a couple of sites we've looked at in Texas.
Kevin Dede: A couple of <unk> have been presented none of them currently outstanding right now and the state of Texas.
Kevin Dede: Okay.
Kevin Dede: The maybe a little more on Luxor OS2.
Kevin Dede: The.
Ryan Duran: Well, I have you, Ryan. Did you deploy that across all your machines at this point? And will that you'll also be able to run it on your S21? Yes, it's deployed on all of our machines that are Calumet mining site. It is not on the machines that are at mining at core, just to be clear on that. And yes, we can deploy those on newer machines as well.
Ryan: Maybe a little more on Merrell Luxor OS two while I have you Ryan.
Speaker Change: Could you deploy that across all your machines at this point and will that you'll also be able to run it on your F 'twenty ones.
Ryan: Yes. It is deployed on on all of our machines that are Calumet mining site.
Speaker Change: It is not on the machines that are at.
Ryan: Mining at core just.
Speaker Change: Just to be clear on that.
Speaker Change: And yes, we can deploy those on newer machines as well.
Kevin Dede: Okay, last question for me.
Speaker Change: Okay last question for me.
Kevin Dede: by Rick on the on the secured loan, you I guess what I thought I understood is that you see it the way that you've structured that loan as an advantage. I know you guys are really good at that.
Rick Russell: Rick on the on the secured loan you.
Rick Russell: I guess, what I thought I understood is that you would see it the way that you've structured that loan is an advantage I know you guys are really good at that can you just run through the details on that for me. So it's clear please sure.
Rick Russell: Can you just run through the details on that for me so it's clear, please? Sure. The $5 million secured loan is used mainly to help pay for the hosting site that we just purchased on my end site in Oklahoma. And since that's a long term... at we think of, you know, That's why we did a loan there versus liquidating our Bitcoin, which we think has more up He, you know, to increase in value from where it is or at your end. Right. The loan's like 12% for two years. So we can either refinance that, you know, when the time comes or pay it off with hopefully higher Bitcoin balance.
Meg: Meg 5 million dollar secured loan is used mainly to help pay for the Hudson side that would just.
Rick Russell: Parts of the mine site in Oklahoma, and so that's a long term.
Rick Russell: As we think.
Rick Russell: That's why we did alone there versus liquidating, our bitcoin, which we think has more.
Rick Russell:
Rick Russell: Up.
Rick Russell: No.
Rick Russell: The increase in value from where it is or at year end.
Right the loans at 12% for two years.
Rick Russell: We can either re.
Rick Russell: Finance that when the time comes or pay it off with hopefully higher bitcoin balances.
Rick Russell: Okay. So it's not it's it's a function of value and not number of Well, it's secured by a $5 million Bitcoin as custody. And that would The number of Bitcoin would free up if the Bitcoin price jumps to about 50. It would. Yeah. Yeah, okay. Okay.
Rick Russell: Okay.
Rick Russell: So it's not it's a function of value and not number of bitcoin.
Rick Russell: Is that secured by a $5 million bitcoin as Cassidy.
Rick Russell: In bat would.
Rick Russell: The number of big clinical re up it.
Rick Russell: The bitcoin prices jumped to price goes up.
Rick Russell: Yes.
Kevin Dede: Thank you. Thank you, gentlemen. Appreciate the insight and color. Thank Thank you.
Rick Russell: Yeah, Okay. Okay. Thank you gentlemen.
Rick Russell: Appreciate the insight and color. Thank you.
Matthew Galinko: Our next question comes from the line of Matthew Galinko with Maxim Group. Your line is now open. Hey, good morning. I wanted to go a little bit further into the pipeline for new, you know, data center and power assets. I know you touched on Texas, but are you beginning to evaluate other assets? beyond that. Sure, Matt. Like we said in the presentation, we're looking at somewhere between 2 and 15 megawatts. We look at the main thing is the price of electricity. And then the real important thing is the terms of the contract. And so in Oklahoma, we're very happy with our situation where it treats us as a power provider, which allows us when we curtail to actually sell the unused power back to the grid.
Speaker Change: Thank you. Our next question comes from the line of Matthew <unk> with Maxim Group. Your line is now open.
Matthew: Hey, good morning, guys. Thank you for taking my question wanted to go a little bit further into the pipeline for.
Rick Russell: For new.
Speaker Change: Data center and power assets I know you touched on taxes, but Tom are you.
Rick Russell: No need to evaluate.
Rick Russell: Other assets beyond that and what sorts of.
Rick Russell: A megawatt capacity are you looking at maybe give us some sense of.
Rick Russell: What are you seeing thanks.
Speaker Change: Sure Matt.
Speaker Change: Like we said in the presentation, we're looking at somewhere between 2% and 15 megawatts.
Speaker Change: We look at the main.
Speaker Change: Thing is the price of electricity and the real important thing is in terms of the contract. So in Oklahoma, We're very happy with our situation where it treats this is a power provider, which allows us when we curtailed to actually sell the unused power back to the grid.
Matthew Galinko: So it's that type of favorable situation that we're seeking in these smaller contracts that seem to have been left by the wayside.
Speaker Change: So it's that type of favorable situations that were seeking new smaller contracts that seem to.
Matthew Galinko: So there's a number of them out there and we're kicking tires on each and every one we can find and we'll have something announced when we bring it to definitive agreement. Thank you. And then maybe.
Speaker Change: Have been left by the wayside, so theres a number of them out there and we're kicking tires on each loan normal compounding.
Speaker Change: Something announce when we bring it to a definitive agreement.
Speaker Change: Alright, Thank you and then.
Speaker Change: Maybe if you could touch on.
Speaker Change: There is any change or higher.
Speaker Change: Thinking about the.
Speaker Change: AI opportunity in 2025 are you continuing to be exclusively focused on bitcoin for your data center and power or Mark.
Matthew Galinko: Bitcoin. We're focused on Bitcoin. We have looked at the AI proposition and simply do not see that we would have capital lift necessary to build an AI facility. We don't have the customer reach to secure a customer for a daily facility. We don't have the experience in running a daily facility for AI. So that's off the charts for us. We view our customer in the world as being the grid and trying to position ourselves in the power market such that we either make money on the Bitcoin or we make money selling power back to the grid.
Speaker Change: No.
Speaker Change: Are there any discussions to.
Diversify.
Speaker Change: Thanks.
Speaker Change: Where you're focused on because we have looked at the proposition and simply do not see that.
Speaker Change: We would have.
Speaker Change: Capital if necessary to build that facility.
Speaker Change: I don't have the customer reach to secure customer for a Davis facility, we don't have the experience in running them.
Speaker Change: So in Korea, So that's off the charts for US we view our customer in the world is being the grid.
Speaker Change: Turning to position ourselves in the power market such that we either make money on the big point, when we make money selling power back to the grid.
Matthew Galinko: Right. All right. Thank you.
Speaker Change: Great Alright, thank you.
Operator: And I'm currently showing no further questions at this time.
Speaker Change: Thank you.
Speaker Change: And I'm currently showing no further questions at this time. Thank you for joining today's earnings call you may now disconnect.
Operator: Thank you for joining today's earnings call.
Operator: You may now disconnect.
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: So.
Speaker Change:
Speaker Change: Yeah.
Speaker Change: [music].
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: Okay.
Speaker Change: [music].