Q1 2025 Bitdeer Technologies Group Earnings Call

Operator: Good day and welcome to the Bitdeer first quarter 2025 earnings call. At this time, all participants are in listen-only mode. After the speaker's presentation, there'll be a question and answer session.

Good day and welcome to the bid to your first quarter 2025 earnings call. At this time all participants are in listen only mode. After the speaker's presentation there'll be a question and answer session.

Operator: Instructions will be given at that time. As a reminder, this call may be recorded.

It will be given at that time.

As a reminder, this call maybe recorded.

Yujia Zhai: I would like to turn the call over to Yujia Zhai, Investor Relations Advisor. Please go ahead. Thank you, operator, and good morning.

Like to turn the call over to your GSI Investor Relations adviser. Please go ahead.

Thank you operator and good morning.

Yujia Zhai: Welcome to Bitdeer's first quarter 2025 earnings conference. Joining me today are Jihan Wu, Chairman and CEO, Matt Kong, Chief Business Officer. Chief Strategy Officer, and Jeff LaBerge, Head of Capital Markets and Strategic Initiatives. Haris will begin today by providing a high level overview of Bitdeer's first quarter 2025 results, and then cover the company's strategy and a detailed business update. After that, Jeff will cover Bitdeer's first quarter financial results in more detail, and then we will open the call for questions.

Speaker Change: Welcome to <unk> first quarter 2025 earnings conference call. Joining me today are <unk> chairman and CEO.

Speaker Change: Khan, Chief Business Officer, Harriss asset Chief strategy Officer, and Geoff what bearish head of capital markets and strategic initiatives.

Speaker Change: Harriss will begin today by providing a high level overview of it.

Speaker Change: <unk> first quarter 2025 results and then cover the company's strategy.

Speaker Change: Detailed business update.

Speaker Change: After that Jack will cover first quarter financial results in more detail and then we will open the call for questions.

Yujia Zhai: To accompany today's earnings call, we have provided a supplemental investor presentation. This presentation can be found on Bitdeer's investor relations website under webcasts and presentations.

Speaker Change: To accompany today's earnings call, we have provided a supplemental investor presentation.

Speaker Change: This presentation can be found on <unk> investor relations website under webcast and presentations.

Yujia Zhai: Before management begins their formal remarks, we would like to remind everyone that during today's call, we may make certain forward-looking statements. These statements are based on management's current expectations and are subject to risk and uncertainties, which may cause actual results of different materials. For a more complete discussion on forward-looking statements and the risks and uncertainties related to Bitdeer's business, please refer to its filings with the SEC. Further, in addition to discussing results that are calculated in accordance with International Financial Reporting Standards, or IFRS, we will also make references to certain non-IFRS financial measures, such as adjusted EBITDA and adjusted profit or loss.

Speaker Change: Before management begins their formal remarks, we would like to remind everyone that during today's call. We may make certain forward looking statements.

Speaker Change: These statements are based on management's current expectations and are subject to risks and uncertainties, which may cause actual results to differ materially.

Speaker Change: For a more complete discussion on forward looking statements and the risks and uncertainties related to big fish business. Please refer to its filings with the SEC.

Speaker Change: Further in addition to discussing results that are calculated in accordance with international financial reporting standards or <unk>.

Speaker Change: We will also make references to certain non <unk> financial measures, such as adjusted EBITDA and adjusted profit or loss.

Yujia Zhai: For more detailed information on our non-IFRS financial measures, please refer to our earnings release that was published earlier today, which can be found on Bitdeer's Investor Relations website.

Speaker Change: For more detailed information on our non <unk> financial measures. Please refer to our earnings release that was published earlier today, which can be found on <unk> Investor Relations website.

Yujia Zhai: Thank you.

Haris Basit: I will now turn the call over to Haris. Haris? Thank you, Yujia, and good day, everyone.

Speaker Change: I will now turn the call over to Harriss Harriss.

Harriss Harriss: Thank you, Jeff and good day everyone.

Haris Basit: Thanks for joining our first quarter 2025 earning I'm excited to share the many developments happening at Bitdeer. and walk you through the progress we've made since last. before diving.

Speaker Change: Thanks for joining our first quarter 2025 earnings call.

Speaker Change: I'm excited to share the many developments happening at mid tier.

Speaker Change: And walk you through the progress we've made since last quarter.

Haris Basit: I'd like to briefly highlight Q1 Financial. for which Jeff will provide more details in a few minutes. starting on slide three. For Q1, total revenue was $70.1 million. Gross profit was negative $3.2 million. and adjusted EBITDA was negative 56.1 million. The lower performance compared to Q1 last year. primarily driven by the impact of the 2024 Habitat. higher global network hash rates, lower host... and Cloud Mining Revenue and Higher R&D Costs Related to the One-Off Development and Tape-Out Costs of our SEAL 032. These negative impacts were partially offset by higher average self-mining hash rate. increased to 11.5 exahash per second at the end of the quarter, as well as higher Bitcoin prices.

Speaker Change: Before diving in.

Speaker Change: Like to briefly highlight our Q1 financial results for which Jeff will provide more details in a few minutes.

Speaker Change: Starting on slide three.

Jeff: For Q1 total revenue was $70 1 million.

Jeff: Gross profit was negative $3 2 million.

Jeff: And adjusted EBITDA was negative $56 1 million.

Jeff: The lower performance compared to Q1 last year was primarily driven by the impact of the 2020 for having.

Jeff: Higher global network cash rate.

Jeff: Lower hosting.

Jeff: And cloud mining revenue and higher R&D costs related to the one off development and tape out costs of our steel zero three chip.

Jeff: These negative impacts were partially offset by higher average self mining cash rate.

Jeff: Which increased to 11 five extra hash per second at the end of the quarter as well as higher bitcoin prices.

Haris Basit: Over the past year, we have made the strategic decision to prioritize the development of our own ACIP. While this temporarily slowed our hashrate growth, it positioned us with long-term advantages that fundamentally differentiate our business. Producing our own machines enabled us to scale at a significant cost advantage and maintain greater control over our growth trajectory. Now that our steel miners are quickly coming off the production line. We expect a rapid acceleration in self-mining hash rates in the quarters ahead. In tandem, we are bringing online nearly 500 megawatts of new self-mining power capacity by MIGI. increasing our total global capacity to nearly 1.6 gigawatts.

Jeff: Over the past year.

Jeff: We have made the strategic decision to prioritize the development of our own ASIC technology.

Jeff: While this temporarily slowed our hatch rate growth.

Jeff: <unk> does with long term advantages that fundamentally differentiate our business.

Jeff: Using our own machines enabled us to scale at a significant cost advantage and maintained greater control over our growth trajectory.

Jeff: Now that our sealed miners are quickly coming off the production line, we expect a rapid acceleration in self mining hatch rate in the quarters ahead.

Jeff: In tandem we are bringing online nearly 500 megawatts of new self mining power capacity by mid year.

Jeff: Increasing our total global capacity to nearly one six gigawatts.

Haris Basit: More than half of this power is located in Norway and Our early focus on geographic diversification is now yielding results. Accordingly, in the near term, we are prioritizing deployments of our A2 mining machines to Bhutan and Norway, which we expect will drive our self-mining hashrate.

Jeff: More than half of this power is located in Norway and baton.

Jeff: Our early focus on geographic diversification is now yielding results.

Jeff: Accordingly in the near term, we are prioritizing deployment of our <unk> mining machines to Bhutan, and Norway, which.

Jeff: Which we expect will drive our self mining cash rate to 40 extra hash per second by October 2025.

Haris Basit: 40 Exahash per second by October 2021.

Haris Basit: on the commercialization. We are encouraged by the recent trade negotiations, which have led to a de-escalation in tariffs. Looking ahead, we expect U.S. tariff policies to encourage more Bitcoin mining-related manufacturing in the U.S. and anticipate a continued shift towards more balanced trade. We plan to migrate a portion of our manufacturing to the U.S.

Jeff: On the commercialization front.

Jeff: We are encouraged by the recent trade negotiations, which have led to a de escalation in tariffs.

Jeff: Looking ahead, we expect U S tariff policies to encourage more bitcoin mining related manufacturing in the U S.

Jeff: And anticipate a continued shift towards more balanced trade measures.

Jeff: Plan to migrate a portion of our manufacturing to the U S. In the second half of 2025.

Haris Basit: in the second half of 2025, and we'll share more details about this in future calls. Over the longer term, we expect demand for Bitcoin mining rigs to continue rising.

Jeff: And we'll share more details about this in future calls.

Jeff: Over the longer term, we expect demand for bitcoin mining rigs to continue rising.

Haris Basit: Having the most efficient chip will be essential to capture this multi-billion dollar Moving now to our ASIC Roadmap. highlighted on slide five of our supplemental. Starting with fuel miner A1. At the end of Q1, we completed the mass production of 3.7 exa-hash per second of our SteelMiner A1 Mining System. and finished installation and energization as of the end of April 2025. For Sealminer A2, mass production of the previously announced 35 ExaHash remains on track to be completed in October 2025. As of the end of April, we completed manufacturing of 3.3 ExaHashable. CL Miner, A2 Mining.

Jeff: The most efficient chip will be essential to capture this multibillion dollar Tam.

Jeff: Moving now to our ASIC roadmap, which is highlighted on slide five of our supplemental presentation.

Jeff: Starting with fuel miner <unk>.

Jeff: At the end of Q1, we completed the mass production of $3 seven extra hash per second of our seal minor a one mining rigs and finished installation and amortization as of the end of April 2025.

Jeff: But still a minor <unk> Matt.

Jeff: Mass production of the previously announced 35 <unk> for a second.

Jeff: <unk> is on track to be completed in October 2025.

Jeff: As at the end of April we completed manufacturing of three three <unk> per second of steel miner, <unk> mining rigs and one to extra hash per second we're being assembled.

Haris Basit: and 1.2 exahash per second were being assembled. Of the 3.3 ExaHash per second of completed miners, 1.3 ExaHash per second have been sold and shipped to external customers. and 0.5 X. have been deployed and energized at Bitdeer's data centers in Texas and Tito, Norway. with the remaining in transit or being prepared for. Additionally, at the end of Q1, we launched a Pro Series of our SealMiner A2 miners. including both an air-cooled and hydro-cooled model. both with an impressive power. 14.9 Joules per TeraHertz For steel miner A3, we completed rigorous testing of several dozen of our prototype models in April, and energy efficiency continues to meet our expectations.

Jeff: Of the three three <unk> per second half completed miners.

Jeff: One three <unk> per second have been sold and shipped to external customers and 0.5 extra Hasbro second have been deployed and energized at <unk> data centers in Texas and Tito Norway.

Jeff: With the remaining in transit or being prepared for shipment.

Jeff: Additionally, at the end of Q1, we launched our pro series of our seal miner <unk> mining rigs.

Jeff: Including both on air cooled and hydro called model.

Jeff: Both with an impressive power efficiency of $14 nine fuels per tower ash.

Jeff: Brazil miner <unk> III we.

Jeff: We completed rigorous testing of several dozen of our prototype model in April and energy efficiency continues to meet our expectations.

Haris Basit: We have begun machine level testing and results are expected to be finalized by late Q2.

Jeff: We have begun machine level testing and results are expected to be finalized by late Q2.

Haris Basit: We anticipate mass production for our steel miner A3 to commence Q3 of this year.

Jeff: We anticipate mass production product seal miner, <unk> III to commence in Q3 of this year.

Haris Basit: Looking ahead to the second half of Our R&D efforts are now focused on our SealMiner A4 project. for which we are targeting an unprecedented efficiency of approximately 5 joules per terahash at the chip. This ship has been completely redesigned from the ground. leveraging a new digital architecture and technology that significantly improves energy efficiency. We believe this new chip design will revolutionize the way Bitcoin mining ASICs are made in the future. We have begun the process of filing patents on this technology and TapeOut is on track for Q4 2025. We believe Teal Miner A4. along with our third generation.

Jeff: Looking ahead to the second half of this year.

Jeff: Our R&D efforts are now focused on our seal miner for a project.

Jeff: For which we are targeting an unprecedented deficiency of approximately five <unk> at the chip level.

Jeff: This chip has been completely redesigned from the ground up.

Jeff: Leveraging a new digital architecture, and technology that significantly improves energy efficiency.

Jeff: We believe this new chip design will revolutionize the way bitcoin mining Asics are made in the future.

Jeff: We have begun the process of filing patents on this technology and tape out is on track for Q4 2025.

Speaker Change: We believe see a minor a four.

Speaker Change: Along with our third generation chip.

Haris Basit: will position Bitdeer as the leading supplier of the world's most energy efficient mining significantly strengthening our market position and unlocking substantial value for our customers and shareholders.

Speaker Change: Position <unk> as the leading supplier of the world's most energy efficient mining rigs.

Speaker Change: Significantly strengthening our market position and unlocking substantial value for our customers and shareholders.

Haris Basit: On slide six of our Supplemental Investor Presentation. We reiterate our prior guidance for our self-mining hash rate to reach approximately 40 exahash per second by Q4 of this year. Given the significant amount of power capacity we have coming online, our near-term plan is to prioritize our current ASIC production towards self-mining and utilize the bulk of our new power capacity in Tidal Norway and Jigmeling Bhutan. Please note that this forecast does not include anticipated additional wafer allocations for CL02 or for CL03. depending on the exact manufacturer. and Actual Wafer Allocation. self-mining hash rate could be well above 40 exahash per second guidance by Q4 2025.

Speaker Change: On slide six of our supplemental investor presentation, we reiterate our prior guidance for our self mining hatch rate to reach approximately 40 extra hash per second by Q4 of this year.

Speaker Change: Given the significant amount of power capacity, we have coming online.

Speaker Change: Our near term plan is to prioritize our current ASIC production towards self mining and utilize the bulk of our new power capacity and keto, Norway and jig milling Bhutan.

Speaker Change: Please note that this forecast does not include anticipated additional wafer allocations for <unk> zero, two or foresee altera III.

Speaker Change: Depending on the exact manufacturing schedule and actual wafer allocations are self mining hatch rate could be well above 40 extra hash per second guidance by Q4 2025.

Haris Basit: Next, I'd like to provide a quick update of our energy. Pipeline that's highlighted on slides 7 and 8 of our Supplemental Investor Presentation.

Speaker Change: Next I'd like to provide a quick update of our energy infrastructure and pipeline that is highlighted on slide seven and eight of our supplemental investor presentation.

Haris Basit: In early April, Bitdeer signed an SPA and a turnkey agreement for the acquisition and construction of a 50 megawatt mining data center in Ethiopia. The transaction includes a local company with a mining permit, a 33 kilovolt substation, and a four-year power purchase. with Ethiopian Electric Power. We are working closely with an EPC contractor that specializes in Bitcoin mining and are targeting energization by Q4 2025.

Speaker Change: In early April, but tier signed an SBA and a turnkey agreement for the acquisition and construction of a 50 megawatt mining data center in Ethiopia.

Speaker Change: The transaction includes a local company with a mining permit at 33, kilovolt substation interconnection and a four year power purchase agreement with Ethiopian Electric power company.

Speaker Change: We are working closely with an EPC contractor that specializes in bitcoin mining and are targeting <unk> by Q4 2025.

Haris Basit: This project reflects our continued commitment to identifying cost-efficient sites that allow us to keep older generation machines online to maximize the ROI of our existing systems. Additionally, in April, we energized 202 megawatts of data center capacity for self. of which 70 megawatts was at our Tidal Norway. and 132 megawatts in Jigmeling Bhutan. We expect the remaining 105 megawatts in TETL and 368 megawatts in Jigmeling to be energized by the end of bringing our total available power capacity to nearly 1.6 gigawatts.

Speaker Change: This project reflects our continued commitment to identifying cost efficient sites that allow us to keep older generation machines online to maximize the ROI of our existing fleet.

Speaker Change: Additionally in April we energized 202 megawatts of data center capacity for self mining of.

Speaker Change: Of which 70 megawatts what's that.

Speaker Change: Our title Norway site.

Speaker Change: And 132 megawatts in Jake milling Bhutan.

Speaker Change: We expect the remaining 105 megawatts and Tito and 368 megawatts and Jake milling to be energized by the end of June.

Speaker Change: Bringing our total available power capacity to nearly one six gigawatts.

Haris Basit: By the end of 2025, we are also on track to energize an additional 221 megawatts in Massillon, Ohio, and including our Ethiopia site, our total available power capacity will reach over 1.8 gigawatts.

Speaker Change: By the end of 2025, we are also on track to energize and additional 221 megawatts in Massillon, Ohio.

Speaker Change: And including our Ethiopia site, our total available power capacity will reach over one eight gigawatts.

Haris Basit: Finally.

Haris Basit: In April, due to advancing discussions with development partners and end-users for HPC-AI, we made the strategic decision to pause Bitcoin mining-related construction at our 570-megawatt site in Clarington, Ohio. However, we maintain full optionality to reassess and resume the build-out for Bitcoin mining at a later date. in terms of our HPC-AI initiative.

Speaker Change: Finally.

Speaker Change: In April due to advancing discussions with development partners and end users for HBC AI, we've made the strategic decision to pause bitcoin mining related construction at our 570 megawatt site and Carrington, Ohio.

Speaker Change: However, we maintained full optionality to reassess and resume the buildout for bitcoin mining at a later date.

Speaker Change: In terms of our HBC AI initiatives in March we formalized an engagement with Northland capital markets to act as financial adviser for our HBC AI data Center development strategy.

Haris Basit: In March, we formalized an engagement with Northland Capital Markets to act as financial advisor for our HPC-AI data center development strategy. Northland has been assisting us in our negotiations with potential development partners in providing guidance regarding capital. As of May, we have advanced discussion. development partners and potential end-users for selected large-scale sites in the U.S. including our Clarington, Ohio site for HPC and AI.

Speaker Change: Northland has been assisting us in our negotiations with potential development partners and providing guidance regarding capital providers.

Speaker Change: As of May we have advanced discussions with development partners and potential end users selected large scale sites in the U S, including our clearing to know, Ohio site for HBC and AI.

Haris Basit: In summary, we have many exciting milestones. We expect 2025 to be a pivotal year as our efforts start to bear fruit. and we look forward to sharing updates on our progress.

Speaker Change: In summary, we have many exciting milestones on the horizon.

Speaker Change: We expect 2025 to be a pivotal year as our efforts start to bear fruit and we look forward to sharing updates on our progress.

Jeff Laberge: I'll now turn it over to Jeff Laberge, our Head of Capital Markets and Strategic Initiatives, to go over our financial results for the quarter. Thank you, Haris. Before I go over Bitdeer's first quarter financial results, I'd like to remind everyone that all figures I refer to today are in U.S. dollars and that all comparisons are to Q1 of last year. U1 consolidated revenue was $70.1 million versus $119.5 million. Self-mining revenue was $37.2 million, down 23.1%, primarily due to the April 24 having event and an increase in global network cash rate, partially offset by higher self-mining cash rate and higher Bitcoin Loud Hatch Street revenue was $0.1 million versus $18.1 million.

Jeff: I'll now turn it over to Jeff <unk>, our head of capital markets and strategic initiatives to go over our financial results for the quarter.

Speaker Change: Thank you Harriss Alright go over <unk> first quarter financial results I'd like to remind everyone that all figures I refer to today are in U S dollars and that all comparisons are Q1 last year.

Speaker Change: You wanted consolidated revenue was $70 1 million versus $119 $5 million.

Speaker Change: Mining revenue was $37 $2 million.

Speaker Change: Three 1% primarily due to the April 24, having events and an increase in global network hash rate, partially offset by higher stock might attach rate and higher corn prices.

Speaker Change: <unk> revenue was <unk> $1 million versus $18 1 million. This decline was due to the exploration of long term <unk> contracts and the subsequent reallocation of the tax rate.

Jeff Laberge: This decline was due to the expiration of long-term cloud hashrate contracts and the subsequent reallocation of this hashrate through a self-mining operation. General hosting revenue was $9.6 million versus $29 million. Membership hosting revenue was $16.3 million versus $19.5 million. DMiner sales revenue in Q1 was $4.1 million.

Operations.

Speaker Change: Daryl hosting revenue was $9 6 million.

Speaker Change: Versus 2000 9 million.

Membership hosting revenue was $16 3 million versus $19 5 million.

Speaker Change: Keep in mind, our sales revenue in Q1 was $4 1 million.

Jeff Laberge: The decrease in hosting revenue was mainly caused by two factors. First, we converted 100 megawatts of hosting capacity at our Texas facility to hydro-cooling capacity, which is expected to be renovated and equipped with steel miner hydro-cooled mining rigs. begin phasing in during the first quarter of 2025. Second, some hosted customers removed less efficient miners after the halving in April of 2024. Some of this extra capacity is currently being replenished by new hosted...

Speaker Change: The decrease in hosting revenue was mainly caused by two factors.

Speaker Change: First we converted 100 megawatts hosting capacity at our Texas facility.

Speaker Change: And capacity, which is expected to be renovated and equipped with steel miner hydro mining rigs.

Speaker Change: That begins at <unk> during the first quarter of 2025.

Speaker Change: Second some hosted customers remove less efficient miners after the having in April 2024.

Speaker Change: Some of this extra capacity is currently being replenished.

Speaker Change: <unk> hosted mining rates.

Jeff Laberge: So the gross profit for the quarter was negative $3.2 million versus positive $34.1 million. And gross margin was negative 4.6% versus 28.6%. Decrease in our gross margin is primarily driven by the April 2024 halving, events impact on our self-mining, and lower hosting and cloud hashrate revenues.

Speaker Change: Total gross profit for the quarter was negative $3 2 million versus positive $34 1 million and gross margin was negative four 6% versus 28, 6%.

Speaker Change: The decrease in our gross margin was primarily driven by vehicles 2024, having events impact our self mining and lower hosting and cloud past rate revenues.

Jeff Laberge: Total operating expenses for the quarter were $75.8 million and $37.8 million. The increase was primarily driven by higher R&D costs related to the one-off tape-out costs for CO-Minor 03, higher engineering costs related to the company's ASIC development roadmap, and non-cash amortization expenses of intangible assets related to the acquisition of FreeChain in Q4 2024. Other operating expenses were $7.8 million due primarily to non-cash equipment update. As a reminder, under IFRS, Bitcoin is classified as an intangible asset and is measured at cost less any accumulated impairment losses with no subsequent revaluation permitted.

Speaker Change: Total operating expenses for the quarter were $75 $8 million and $37 $8 million. The increase was primarily driven by higher R&D costs related to the one off tape out costs for <unk> III.

Speaker Change: Higher engineering costs related to the company ASIC development roadmap.

Speaker Change: Noncash amortization expenses of intangible assets related to the acquisition of preaching in Q.

Speaker Change: Q4 2024.

Speaker Change: Other operating expenses were $7 $8 million due primarily to noncash.

Speaker Change: Chairman of Bitcoin.

Speaker Change: As a reminder, under IRS.

Speaker Change: It is classified as an intangible asset and is measured at cost less any accumulated impairment losses no subsequent evaluations permitted.

Jeff Laberge: Other net gain for the quarter was $503.1 million versus $2.4 million. The net gain was due to the non-cash derivative gains on the convertible bonds issued in August 2024 and November 2024, and the tether warrants, which I will discuss in more detail in the IFRS net profit was $409.5 million and $0.6 million. adjusted profit was negative $89.8 million versus positive $9.7 million. adjusted EBITDA was negative $56.1 million versus positive $27.3 million. This quarter's low performance compared to Q1 last year was primarily driven by the impact of the 2024 having higher global network cash rates, lower hosting and cloud mining revenue, higher R&D costs as described previously.

Speaker Change: Other net gain for the quarter was $503 1 million.

Speaker Change: $2 $4 million the net gain was due to the noncash derivative gains.

Speaker Change: Vertical bonds issued in August 2020, or and November 2024, and this other warrants, which I will discuss in more detail in the liability section.

Speaker Change: <unk> net profit was $495 million and zero point $6 million.

Speaker Change: Adjusted profit was negative $89 8 million versus positive $9 7 million.

Speaker Change: Adjusted EBITDA was negative $56 1 million versus positive $27 $3 million.

Speaker Change: This quarter's lower performance compared to Q1 last year was primarily driven by the impact of each of which 24, having higher global network cash rate lower hosting and cloud money revenue.

Speaker Change: R&D costs as described previously.

Jeff Laberge: negative impacts were partially offset by higher average self-mining hash rate and higher Bitcoin prices for the quarter.

Speaker Change: Ergative impacts were partially offset by higher average self mighty hash rate and higher <unk> prices for the quarter.

Jeff Laberge: Net cash used for operating activities was $284 million. Predominantly driven by steel miners, supply chain and manufacturing. Net cash used for investment activities was $73.6 million, including $45.7 million of capital expenditures for infrastructure construction and mining rigs. $18.2 million for the purchase of cryptocurrencies, $21.9 million to acquire, recite, and gas fire. Power Project in Alberta. $12.39 proceeds from disposal of cryptocurrencies from the principal business.

Speaker Change: Net cash used for operating activities was $184 million.

Speaker Change: Dominantly driven by steel minor supply chain and manufacturing net cash used for investing activities was $73 $6 million.

Speaker Change: $45 7 million of.

Speaker Change: Capital expenditures for infrastructure construction and mining rates.

Speaker Change: $18 $2 million for the purchase of crypto currencies.

Speaker Change: $1 $9 million to acquire the site and gas fired.

Speaker Change: Power project in Alberta.

Speaker Change: And $12 $3 million of proceeds from disposal of critical currencies from the principal business.

Jeff Laberge: Net cash generated from financing activities for the quarter was $94.9 million, which resulted primarily from the $118.4 million of net proceeds. issuance of shares under our ATM facility in January and February offset by $21 million used for share repurchase.

Speaker Change: Net cash generated from financing activities for the quarter was $94 9 million, which.

Speaker Change: Primarily from $118 4 million of net proceeds from issuance of shares under our ATM facility January February offset by $21 million used for share repurchases.

Jeff Laberge: Moving on to our 2025 Bitcoin Mining Infrastructure Stat. We expect CapEx for the continued buildup of our global power and data center infrastructure to now be in the range of approximately $260 to $290 million. calendar year 2025. This update includes reported infrastructure catbacks in Q1. The reduction from our prior guidance is due to approximately $80 million in savings for the pause of Bitcoin mining infrastructure construction at our Clarencing Ohio site that Haris spoke about earlier. Please note that this guidance only factors in power and data center spend for Bitcoin mining. It does not include CapEx for seal miners used for self-mining.

Speaker Change: Moving onto our 2025.

Speaker Change: In infrastructure spend.

Speaker Change: We expect Capex for the continued build out of our global power and data center infrastructure, you'll now be in the range of approximately $160 million to $290 million.

Speaker Change: For calendar year 2025.

Speaker Change: This update includes record of infrastructure Capex in Q1.

Speaker Change: The reduction from our prior guidance is due to approximately $80 million in savings for the pause of bitcoin mining infrastructure construction at our clarity, Ohio site that Harris spoke about earlier.

Speaker Change: Please note that this guidance only factors in power in data center spend.

Speaker Change: It does not include Capex for senior miners used for salt life.

Jeff Laberge: terms of our balance sheet, we ended the quarter in a strong financial position with $215.6 million in cash and cash equivalents, $131.1 million in cryptocurrencies. $215.4 million in borrowing excluding derivative liabilities. Derivative liabilities were $256.8 million, which relate to the tether warrants and August 2024 and November 2024 convertible notes, representing a $507.2 million decline compared to our last quarter. Again, this is a non-cash, fair value adjustment driven by the client and our stock price and does not impact our liquidity or operation. Under IFRS, certain derivative instruments such as warrants and convertible debt are required to be revalued at fair market value each reporting period.

Speaker Change: In terms of our balance sheet, we ended the quarter in a strong financial position with $215 $6 million in cash and cash equivalents.

Speaker Change: $131 1 million and predict currencies, and $250 4 million and borrowing excluding derivative liabilities.

Speaker Change: Derivative liabilities were $256 $8 million, which relates to the type of warrants and August 2024 in November 2024 convertible notes, representing a $507 $2 million.

Klein: Klein compared to our last quarter.

Speaker Change: Again this is the noncash fair.

Speaker Change: Fair value adjustments driven by the decline in our stock price and does not impact our liquidity or operations.

Speaker Change: Under our FRS certain derivative instruments, such as warrants and convertible debt.

Speaker Change: Prior to be revalued at fair market value each reporting period.

Jeff Laberge: As our stock price increases, the fair value of these instruments rise, resulting in a higher reported liability and vice versa. The recorded liability will ultimately be netted at settlement, either upon conversion to equity or expiration, and does not represent an actual cash outcome.

As our stock price increases the fair value of these instruments rise, resulting in a higher reported liability and vice versa.

Speaker Change: You recorded liability will ultimately netted that settlement either upon conversion to equity or exploration and does not represent an actual cash outflow.

Jeff Laberge: In April 2025, we entered into a loan agreement with Matrix Finance and Technology Holding Company for a financing facility of up to $200 million. The loans drawn under the facility bear a variable interest rate of 90% plus a market-based reference rate. Straw Down is repayable in six-month installments over 24 months and is secured by a pledge of steel mining. As of today, 2025, we have drawn approximately $90 million under this facility.

Speaker Change: In April 2025, we entered into a loan agreement with matrix Finance and technology holding company.

Speaker Change: Financing facility of up to $200 million.

Speaker Change: The loans drawn under the facility very variable interest rate of 9%, let's say market based reference rate.

Speaker Change: Drawdown is repayable monthly installments over 24 months and is secured by pledge of steel miners.

Speaker Change: Today, only 25, we have drawn approximately $90 million under this facility.

Jeff Laberge: Finally, regarding our outstanding ATM facility, since the middle of February 2025, we have not sold any additional shares given the broader market.

Speaker Change: Finally regarding our outstanding ATM facility.

Speaker Change: The middle of February 2025.

Speaker Change: So any additional shares given the broader market correction.

Jeff Laberge: Thank you, everyone. That concludes the prepare from work section of our earnings call.

Speaker Change: Thank you everyone that concludes the prepared remarks section of our earnings call. Operator, Please open the call for questions.

Operator: Operator, please open the call for. Thank you.

Operator: If you'd like to ask a question, please press star 1. If your question has been answered and you'd like to remove yourself from the queue, please press star 11 again.

Thank you if you'd like to ask a question. Please press star one one.

Speaker Change: If your question has been answered and you'd like to remove yourself from the queue. Please press star one again.

Darren Aftahi: Our first question comes from Darren Aftahi with Roth. Your line is open. Hey guys, good morning. Thanks for taking my questions and nice to see all the progress. A couple things. First, I know in the past you guys talked about third party interest in A2, and I think it was maybe in the seven exit hash range. And then you guys kind of talked earlier this year about taking that in-house for your own self-mining. I'm just kind of curious. Obviously, the world is moving pretty fast, but how has interest in maybe just not the A2, but your chips in general change maybe in the last few weeks?

Darren: First question comes from Darren <unk> with Roth Your line is open.

Darren: Hey, guys. Good morning, Thanks for taking my questions and nice progress.

Darren: A couple of things.

Darren: I know in the past you guys talked about third party interest in <unk>.

Darren: It was maybe seven exit hash range and when you guys kind of talked earlier this year about taking that in house for your own selves, Milo I'm just kind of curious obviously the world is moving pretty fast.

Darren: Interest and maybe not be too, but your ships in general.

Haris Basit: Is there as much third party interest? Has that demand changed since you kind of said you would bring that in-house? And then my second question is on your 40 exit hash target by the end of the year. You, Harris, talked about there could be upside to that. I guess what is under consideration in terms of that target? Is it simply machines and available power? Is there something more nuanced there?

Darren: Change maybe in the last few weeks.

Darren: As much third party interest swaps.

Darren: One change subsequent all said you would bring model.

Darren: My second question is on your.

Darren: <unk> target by the end of the year.

Darren: Tariffs talked about there could be upside to that I guess, what is under consideration in terms of that target is it simply machines and available power or is there something more nuance there. Thank you.

Haris Basit: Thank you. I will take the next question. Generally, we feel that the desire for purchasing mining assets from us has increased. significantly after the decompiles increasing. That's a very natural. So, you can see that we moved. some sales of the Bitcoin money rate. But anyway, our priority is to still sell for money. We want to fulfill our Bitcoin money farm that is going to build up within this year.

Darren: I will take the last question.

Darren: Generally we feel that the desire for Tokyo or anything.

Darren: <unk> from US has increased.

Darren: Cliff can the after the pecan pies.

Darren: And crazy.

Darren: That's.

Darren: Very good.

Darren: Sure.

Darren: So you kind of see that.

Darren: We moved.

Darren: Some sales on the B.

Darren: But anyway, we are powered cases still south of the money, we want to fulfill our commanding pharma does that is going to do that we think the FCA.

Haris Basit: And the second question is that... Umm... the upside of our target. Well, due to the current situation, there is a lot of uncertainty over the capacity, because everyone may want to have more capacity of the TSMC and to have inventory and maybe some of them may give up. We don't know what the decision or the prediction will be. But we always have a strong confidence over TSMC as our capacity and technology partner. and we are communicating with them. So I think we can at least guarantee the prevalence target we have set. Great, thank you.

Darren: And then the second question is that.

Darren: Yes.

Darren: Uh huh.

Darren: The upside of our pocket.

Darren: Well due to the current situation.

Darren: Very yes, so lots of uncertainty over it.

Darren: Okay.

Darren: The capacity because everyone.

Darren: You may want scale.

Darren: Have more capacity.

Darren: That TSMC.

Darren: To have inventory and maybe some of them may give up till now what are the decision under their prediction will be.

Darren: But we always have a strong confidence over TSMC.

Darren: Our capacity and technologic partner.

And we are committed to acting with them. So I think we've had a lease guarantee.

Darren: Premise pocket right now.

Darren: Okay.

Darren: Okay.

Darren: Got it.

Darren: Okay.

Darren: Great. Thank you.

Ben Summers: Our next question comes from Ben Summers with VTIG. Your line is open. Hey, good morning, guys. And thanks for taking my question.

Speaker Change: Thank you. Our next question comes from Ben Summers with BTG. Your line is open.

Ben Summers: Hey, good morning, guys and thanks for taking my question. So first around the decision to pause bitcoin mining development of clarity and kind of any color on the type of customers are hearing it from here and where we are.

Ben Summers: So first around the decision to pause Bitcoin mining development at Clarington, kind of any color on the type of customers we're hearing from here? And you know, where really, where are we seeing the strong demand for the site?

Speaker Change: Where are we seeing a strong demand for the site.

Haris Basit: Okay, I can maybe answer that question. So at this point in time, we are, we're getting some inbound from potential end users or tenants. But our primary work here really is to get a development partner that we can work with to develop this site. And so they have very strong connections, the people we're talking to all the hyperscalers and. We are not. in that stage yet where we're actively pursuing the hyperscalers at the moment, though we are getting some inbound. sort of natural inbound requests at this time. The main focus remains on closing a deal with the development.

Ben Summers: Okay I can maybe answer that question so.

Speaker Change: At this point in time, we are.

Speaker Change: Our.

Speaker Change: We're getting some inbound from potential end users of our tenants, but our primary.

Speaker Change: Work here really is to get a development partner that we can work with to develop the site and so they have very strong connections that people were talking to.

Speaker Change: To all the Hyperscale orders and.

Speaker Change: We are.

Speaker Change: Not.

Speaker Change: In that stage, yet, where we are actively pursuing the hyperscale at the moment that we are getting some inbound.

Speaker Change: And just sort of naturally inbound requests at this time.

Speaker Change: Our focus remains on.

Speaker Change: Closing a deal with a development partner.

Ben Summers: God, it's super helpful.

Jeff Laberge: And then, you know, kind of on the recent loan agreement that we entered, I guess, just, you know, why now? And then how are we kind of thinking about the capital structure moving forward here? And, you know, maybe how are we thinking about managing the Bitcoin balance on the balance sheet as we continue to expand the business?

Speaker Change: Got it Super helpful. And then kind of on the recent loan agreement that we entered I guess, just why now and then how are we kind of thinking about the capital structure moving forward here, maybe how are you thinking about managing the bitcoin balance on the balance sheet as we continue to expand the business.

Jeff Laberge: Jihan, do you want to take that or would you like me to? I can touch on that. So, so yeah, we feel right now again, you know, with the broader correction in the market, you know, we stopped using the ATM in, in February, when the price dropped, you know, quite significantly. So we've always been very conscious of dilution in our, in our, as far as our capital raising process. And, you know, we feel that the business can be can take on a certain amount of debt to finance, especially on the on the mining rig side, where, you know, we have a Awesome, thank you guys for taking my questions.

Speaker Change: Oh.

Speaker Change: Jim do you want take that you'd like me to.

Speaker Change: Okay. That's on that so so yes, we feel right now again with the broader correction in the market. We had stopped using the ATM is in February.

Speaker Change: <unk> dropped quite significantly so we've always been very conscious of dilution in our heart as far as our capital raising process and we feel that the business can be can take out a certain amount of debt to finance, especially on the on the mining rate side, where we have a.

Speaker Change: A certain payback present opportunity for.

Speaker Change: For the use of proceeds so we felt like a responsible a reasonable amount of debt could be utilized to finance.

Speaker Change: Finance the chip purchases.

Speaker Change: Awesome. Thank you guys for taking my questions.

Ben Summers: Thank you.

Kevin Cassidy: Our next question comes from Kevin Cassidy with Rosenblatt Securities. Your line is open. Thanks for taking my question and congratulations on the great progress. You know, the Seal A4 ASIC that you're going for for the fourth quarter, and then when you'll have the SealMiner A4 out, what would be the strategy for that? It seems like that's going to be a very high-demand device or equipment for other miners. Are you going to stay with mostly internal, or will there be enough capacity to sell externally and use it internally? So as we fill up our existing capacity with A2s, and then some A3s, we will naturally transition to more external sales.

Speaker Change: Thank you.

Speaker Change: Next question comes from Kevin Cassidy with Rosenblatt Securities. Your line is open.

Kevin Cassidy: Hi, Thanks for taking my question and congratulations on the great progress.

Speaker Change: The seal for a sick that youre.

Speaker Change: For the fourth quarter, and then you'll have the steel minor a four.

Speaker Change: What would be the strategy for that it seems like thats going to be a very high demand device.

Speaker Change: Equipment for other miners.

Speaker Change: Stay with mostly internal or will there be enough capacity to sell externally and use it internally.

Speaker Change: So as we fill up our existing capacity with <unk> and then some acreage.

Speaker Change: We will naturally transition to more external sales and so for US we tape out as we expect in Q4 that machines won't be ready for at least a couple of quarters after that or maybe even longer and mass production.

Haris Basit: And so A4, you know, if we tape out, as we expect, in Q4, the machines won't be ready for at least a couple of quarters after that, or maybe even a little longer in mass production. So by that time, I expect for certain that. Largely, we will be selling externally because our internal capacity should close to full. And if we get as much capacity from TSMC as we hope, we should be able to have significant external sales. Okay, great.

Speaker Change: So.

Speaker Change: By that time.

Speaker Change: Expect but we won't know for certain that.

Speaker Change: Large Lee we will be selling externally because our internal capacity should be close to full and we get as much capacity from TSMC as we hoped we should be able to have significant external sales.

Haris Basit: And that, you know, does ask the question, how does the transition work from like, if you go from the steel miner A2 to A3, is A3 expect that to keep that in production for, you know, another year or so after A4 is out? Bye. A4 is still not taped out yet. If A4... have it out and we cut it by the chip. I believe that will be at the end of the year or two. get to the status of mass production ready. After the I think A3 and A4 will coexist for quite a long time.

Speaker Change: Okay great.

Yes.

Speaker Change: Ask the question.

Speaker Change: How does the transition work from like if you go from the seal minor a two to a three as <unk> expect that to keep that in production for another year or so after a four is out.

Speaker Change: Uh huh.

Speaker Change: As for.

Speaker Change: Not taped it out yet.

Speaker Change: If <unk>.

Speaker Change: Four.

Speaker Change: Check it out in a way that chip.

Speaker Change: Is that a little bit.

Speaker Change: Yeah in there too.

Speaker Change: To get to the status of mass production ready.

Speaker Change: And.

Speaker Change: Okay.

Speaker Change: After that.

Speaker Change: I think a three and a fall will coexist for quite a long time.

Haris Basit: because A3 will be I think the cost in terms of a dollar per hash will be lower than A4, so it will be... It really depends on different situations which MiningRx users and us want to choose from. And it will also depend on other factors. If we have a really abundant capacity, I think A4 can be a preference. But if the total capacity we can obtain from TSMC is limited, I think A3 maybe actually is better because it can. yield much more hashrate out from the wafers. Okay, great. It's good to have those options. Thanks.

Because.

Speaker Change:

Speaker Change: <unk> III will be.

Speaker Change:

Speaker Change: I think that cost in terms of a dollar per ton cash will be lower than before.

So it will be.

Speaker Change: Okay.

Speaker Change: It depends on different situations I wish my <unk> you.

Speaker Change: Send us one to choose from.

Speaker Change: Uh huh.

Speaker Change: And.

Speaker Change: Also it depends on lots of factors.

Speaker Change: We have a radio abundant capacity thing for Ken.

Speaker Change: Can be our preference, but if the total capacity of weekend.

Speaker Change: <unk> from TSMC is limited ethane three maybe.

Speaker Change: Sri is better because it can.

Speaker Change: Much more hatch rate out of from.

Speaker Change: With us.

Speaker Change: Yeah.

Speaker Change: Okay, great. That's good to have both options.

Nick Giles: Our next question comes from Nick Giles with B-Rally Securities. Your line is open. Operator, good morning, everyone. Guys, apologies if I missed this. But it looks like electricity costs were slightly higher in 1Q. I assume this was on some of the extreme weather early in the year. But can you just touch on how power costs could trend from here? Yeah.

Speaker Change: Thank you. Our next question comes from Nick <unk> with B Riley Securities. Your line is open.

Nick: Thanks, operator, good morning, everyone.

Speaker Change: Guys I apologize if I missed this but it looks like electricity costs were slightly higher in <unk>.

Speaker Change: This was on some of the extreme weather early in the year, but can you just touch on how power cost could trend from here.

Haris Basit: So, Q1 historically has been our highest power price throughout the year. That's primarily due to a couple of things. So, number one, in Bhutan, we have a nine-month PPA at around four and a quarter cents per kilowatt hour. That runs between Q2 and Q4. Q1 is a dry season in Bhutan. So, during that quarter, we typically procure power from the Indian market. We are looking into options, power purchase agreements, and other forward power pricing opportunities to fulfill that moving forward. We were not able to get that in place in time for Q1, so prices in Bhutan were elevated.

Speaker Change: Yes, So Q1, historically has been our highest power price for.

Speaker Change: Throughout the year, that's primarily due to a couple of things number one in Bhutan. We have we have a nine month PPA at around four four in a quarter.

Speaker Change: Per kilowatt hour that runs between Q2 and Q4 Q.

Speaker Change: Q1 is the dry season in Bhutan, so during that quarter, we typically procure power.

Speaker Change: The end market.

Speaker Change: We are looking into options.

Speaker Change: <unk> and the other four are pricing opportunities.

Speaker Change: To fulfill that moving forward, we are not able to get that in place in time for Q1, so prices per ton were elevated.

Haris Basit: Aside from that, Rockdale had slightly elevated prices, just historically, so that led primarily to the increase in power price for the Q1. Moving forward, Q2 and Q3 are typically lower cost quarters for us. We are implementing a much more aggressive power supply and strategy, and we expect some of those to start bearing fruit in this next quarter, possibly Q3. Thanks for that. That's very, that's very helpful.

Speaker Change: Uh huh.

Speaker Change: Aside from that.

Speaker Change: Rockdale had slightly elevated prices just historically.

Speaker Change: <unk>.

Speaker Change: That was a.

Speaker Change: Primarily due to decrease in power price for the Q1.

Speaker Change: Moving forward Q2, and Q3 are typically lower cost quarters for us we are implementing a much more aggressive power split and strategy.

Speaker Change: And we expect some of those.

Speaker Change: So you start bearing fruit in this next quarter, possibly Q3.

Speaker Change: Okay.

Speaker Change: Thanks for that that's very that's very helpful.

Haris Basit: Um, my second question is Clearly your ASIC machines have the opportunity to be the leading edge, but it's been too early for analysts to ultimately track performance and utilization. So what would you consider the first opportunity for the market to see really just the overall efficiency of your fleet, specifically on some of the later generations? Thank you. Even though we are hungry for the machines in our own mining farm, we are still squeezing some of our capacity to customers. That's for them to test and try. And right now, so far so good. I think they already see how good our machines are, have a strong confidence over that.

Speaker Change: My second question is.

Speaker Change: Clearly your ASIC machines has the opportunity to be at the leading edge, but it's been through really for analysts to ultimately track performance and utilization. So what would you consider the first opportunity for the market.

Speaker Change: <unk> really just overall efficiency of your fleet specifically on some of the later generations.

Speaker Change: Even though we are.

Speaker Change: Okay.

Speaker Change: Hungary for machines.

Speaker Change: Our multifamily.

Speaker Change: Squeezing some of our capacity to customers.

Speaker Change: For them to test it in a tie in.

Speaker Change: Right now so far so good.

Speaker Change: I already see that how good a machine or.

Speaker Change: I have a strong confidence over that.

Haris Basit: And that's about A2 and A2 Pro. A3 will be able to ship to our customers in October. And so, the earliest day customers can test A3. October. All right. Got it. Guys, appreciate all the coverage. Best of luck.

Speaker Change: And that's about a 208 crore.

Speaker Change: <unk> III will be able to ship to customers in October.

Speaker Change:

Speaker Change: So the early stage customers contest.

Speaker Change: October.

Speaker Change: Okay.

Speaker Change: Got it.

Speaker Change: Appreciate all the color best of luck.

John Tadaro: Our next question comes from John Tadaro with Needham. Your line is open. Hey, guys. Thanks for taking my question. Congrats on the progress.

Speaker Change: Thank you. Our next question comes from John <unk> with Needham Your line is open.

John: Hey, guys. Thanks for taking my question congrats on the progress.

John Tadaro: First question, I guess just trying to understand where we should be targeting average fleet efficiency. Obviously, you know, some of these rollouts are going to lower that efficiency quite a bit. Just wondering for kind of like, you know, second half of 25 and then 26, what that average roughly would be.

Speaker Change: First question I guess I'm, just trying to understand.

Speaker Change: Where we should be targeting average fleet efficiency.

Speaker Change: Obviously some of these rollouts.

Speaker Change: Going to lower that efficiency quite a bit.

Speaker Change: Just wondering for kind of like.

Speaker Change: Second half of 'twenty five and then.

Speaker Change: 26, what that average roughly would be.

Haris Basit: And then I have a follow-up question on the HPC. Yeah, so I'll take that. So with our, you know, obviously, our average move down from last quarter, it's probably in the high 20s, at this point down from, you know, 31-ish, and sort of historically from our legacy fleet. As we get to approach that 40x hash range, we should be down in the lower 20s in the, you know, 22 to 24 joule per terahash range. That's assuming we keep all of our existing online, which currently we're planning to do. Eventually, obviously, we will start phasing out some of the older rigs.

Speaker Change: And then I have a follow up question on the HBC.

Speaker Change: Yes, so Jon I'll take that so with our.

Speaker Change: Our average move down.

Speaker Change: Last quarter, it's probably in the high <unk> at this point down from 31 ish.

Speaker Change: Historically from our from our legacy fleet.

Speaker Change: As we get the FERC that 40 gigs AST range, we should be down in the lower <unk> and the 22 to 24 <unk> range, that's assuming all of our existing Ashford online, which currently we're planning to do.

Speaker Change: Eventually obviously will start phasing out some of the older rigs some of those can be moved to lower cost power regions like Ethiopia, possibly.

Haris Basit: Some of those can be moved to lower cost power regions like Ethiopia, possibly Canada in the future. But, you know, as those start to be phased out or, you know, diluted by newer, some of our newer generation race, you know, we would expect that efficiency to drop, you know, into those, into the team.

Speaker Change: Future, but.

Speaker Change: As those start to be so.

Speaker Change: Phased out or diluted by.

Speaker Change: Some of our newer generation rigs.

Speaker Change: We expect that efficiency to drop.

Speaker Change: The teams.

Haris Basit: That's helpful. And then on HPC, you know, it sounds like with a development partner, you would look to do a powered shell or maybe full stack. But I noticed, you know, Matsalon wasn't paused, Clarington was. Do you still think both sites could be for HPC or are we going to focus on Matsalon for Bitcoin mining and then the 266 megawatts at Clarington for HPC? So the focus is on Clarington right now. not just the first 266 megawatts, it's the entire 570 megawatts that are there in Clarington.

Speaker Change: That's helpful and then on HBC.

Speaker Change: It sounds like with a development partner you would look to do a powered shell or maybe full.

Speaker Change: But I noted.

Speaker Change: Matt Salon wasn't pause clearing 10 was do you still think both sites could be for HPT or are we going to focus on massillon for bitcoin mining and then the 266 megawatts of clear income for HPT.

Speaker Change: The focus is unclear right now.

Speaker Change: Just the first 266 megawatts hits the entire 570 megawatt center there in Carrington.

Haris Basit: Massillon, we are moving ahead right now with Bitcoin mining at that location. Got it. Okay, great. Thank you.

Speaker Change: Massillon, we are moving ahead right now with bitcoin mining at that location.

Brett Knobloch: Appreciate it, guys. Thank you.

Speaker Change: Got it okay, great. Thank you I appreciate it guys.

Haris Basit: Our next question comes from Brett Knobloch with Cancer Fitzgerald. Your line is open. Hey, guys, thanks for taking my question. Haris, maybe just on the ASIC side, I know before I think you guys said you were going to be allocating somewhere around 7 ExaHash to external sales. Should we still be expecting 7 ExaHash of sales for this year? And of the $4.1 million of ASIC sale revenue this year, or this quarter, was that related to 1.3 ExaHash that was shipped?

Speaker Change: Thank you.

Speaker Change: Next question comes from Brett Knoblauch with Cantor Fitzgerald. Your line is open.

Speaker Change: Hey, guys. Thanks for taking my question, maybe just on the ASIC side I know before I think you guys said you were going to be allocating somewhere as around that then exit has.

Speaker Change: <unk> external sales should we still be expecting seven <unk> of sales for this year.

Speaker Change: The $4 $1 million of ASIC sale revenue. This year was that related or is this quarter was that related to <unk> that was shipped.

Jihan Wu: I'm going to ask Jihan to answer that about the amount of sales that we're... going to allocate for this year. Well, this is quite a dynamic decision, actually. The process, the real process is that I approval the application from the sales. email by email. Generally, I want to deploy to a mining farm and do self-mining, and it highly depends on and the customers and whether we are genuinely want them to have interest and a real test for mining rigs.

Speaker Change: I'm going to ask <unk> to answer that.

Speaker Change: About the amount of sales that were.

Speaker Change: Going to allocate for this year.

Speaker Change: Well this is quite a dynamic decision actually.

Speaker Change: Process rail processes had I approve.

Speaker Change: Approval of the application from the sales.

Speaker Change: E mail by email.

Speaker Change: Generally I want to deploy to all mining farmland itself money.

Speaker Change: In a highly depends on.

Speaker Change: And our customers.

Speaker Change: Great.

Speaker Change: Joe anything you want to.

Speaker Change: Them to have interest in.

Speaker Change: The real test for our money.

Haris Basit: Um So. So I cannot really get you a very precise... prediction about our decision. And then just on the sale or the ASIC revenue from this quarter, is that coming from the 1.3 that was shipped? Correct. Yes, so that's the portion of that that was recognized in the quarter. Some additional may be recognized in And should we still be expecting a average selling price somewhere around $15 a terabyte? Again, there's going to be no change in the pricing, I don't believe. Uh, well, um... due to the competition and the market. we will need to provide competitive price to our customers.

Speaker Change: Alright.

Speaker Change:

Speaker Change: So.

Speaker Change: So I cannot really get you.

Speaker Change: Very precise.

Speaker Change: Predictions about our decisions.

Speaker Change: Okay.

Speaker Change: And then just on the sale or the basic revenue from this quarter is that coming from the one three that was shipped.

Speaker Change: Correct, Yeah. So that's a portion of that was recognized in the quarter. Some additional may be recognized in Q2.

Speaker Change: And should we still be expecting a average selling price somewhere is around $15 of tariffs.

Speaker Change: Jim Theres going to be changing the pricing a couple of weeks here.

Speaker Change: Well.

Speaker Change: Good deal.

Speaker Change: The.

Speaker Change: Competition in the market.

Speaker Change: Uh huh.

Speaker Change: We will need to provide competitive pricing to our customers.

Jihan Wu: And the most recent pricing hack is the... $12.8 per hash, if I remember it correctly. For A2 and A2 Pro, we will just follow the market dynamics. If competitors lower the price, I think we will fall up. Anyway, our quantity of the sales is limited. We don't fear to join any price competitions at this point. Perfect, understood.

Speaker Change: And.

Speaker Change: The most recent pricing.

Speaker Change: $8.

Speaker Change: Having a greater correctly.

Speaker Change: Uh huh.

Speaker Change: And.

For <unk> Paul.

Speaker Change: We actually have to follow the market dynamics.

Speaker Change: Yes.

Speaker Change: As noted in our price I think we will follow up anyway or quantity of the south is limited.

Speaker Change: We're counting fair to charge any price.

Speaker Change: So at this point of time.

Speaker Change: Yeah.

Haris Basit: And then on the Delfin Oxygen growth, I thought I heard that you guys were expecting 40x a hash by October. Is it by October or by end of the year? It's by October. by October. Okay, awesome. Really appreciate it, guys. Thank you.

Speaker Change: Perfect understood.

Speaker Change: Then on the.

Speaker Change: Group.

Speaker Change: I.

Speaker Change: So what I heard that you guys were expecting 40 extra hash by October is it by October or by end of the year.

Speaker Change: It's by October.

Speaker Change: Okay Awesome really appreciate it guys. Thanks.

Yes.

Mike Grondahl: Our next question comes from Mike Grondahl with Northland. Your line is open. Hey, guys. Thank you. Two questions. One...

Speaker Change: Thank you.

Speaker Change: Tim comes from Mike Grondahl with Northland Your line is open.

Speaker Change: Hey, guys. Thank you.

Speaker Change: Two questions one.

Haris Basit: your lowered cap ex- kind of highlight where that's going this year. And then secondly, if you could just provide a little bit more detail on that CO minor loan facility. Is that for the chip? Inventory Financing Finished Goods just kind of help us understand mechanically how that Yeah, sure.

Youre lowered capex.

Speaker Change: Guidance $2 60 to $2 90 could you kind of highlight where that's going this year.

Speaker Change: And then secondly, if you could just provide a little bit more detail on that seal minor loan facility is that for the chips inventory financing finished goods just kind of help us understand mechanically how that will work.

Haris Basit: Mike, I can take that first part. So the CapEx is primarily related to the finishing of the Taiga-Norway site and the Jigawing site. as well as our Madsen, Ohio site. So between those three is another 100. $20 million. And we also have budgeted in there for... finishing up Texas and some for Canada and a small amount for the Ethiopia project. And again, the $260,000 is really for the entire year. So when I just go there was sort of the remaining amount, maybe $190 million. for the rest of the year.

Speaker Change: Yes, sure Mike I can take that first part so the capex is.

Speaker Change: Primarily it related to the finishing of the title nor are we cite.

Speaker Change: And the <unk> site.

Speaker Change: As well as our Madison, Ohio site, so between those three years.

Speaker Change: The other one hundreds.

Speaker Change: $20 million.

Speaker Change: And we also have budgeted and therefore.

Speaker Change: Finishing up Texas.

Speaker Change: In sum for Canada, and the small amount with Ethiopia project.

Speaker Change: Yeah.

Speaker Change: And again that the 264 is really for the entire year. So.

Speaker Change: There was sort of the remaining amount may be $190 million level four.

Speaker Change: For the rest of the year.

Haris Basit: And, oh, sorry, what was the second question, Mike? the SEAL minor loan facility you talked about. https://bit.ly.com.au It's to be used to finance the purchase of chips, and then the load itself is going to be secured by the chips all the way through to the end-seal miner. Got it. So those miners are kind of acting as collateral, kind of pre-sale. correct, or for, in this case, self-mining. Okay. Thank Thank you.

Speaker Change: And sorry, what was the second question Mike.

Speaker Change: Okay.

Speaker Change: Seal minor loan facility you talked about that you recently put in place just mechanically how does that work is it on chips inventory finished goods.

Speaker Change: Yes.

Speaker Change: We use it to finance the purchase of chips and the loan itself is going to be secure.

Speaker Change: Sure by the weather.

Speaker Change: For the chips, all the way through to the.

Speaker Change: C a miner.

Speaker Change: Got it so those miners are kind of acting as collateral kind of pre sale if you will.

Speaker Change: Correct or force yourself mining use.

Speaker Change: Got it.

Speaker Change: Okay. Thank you.

Brian Kinstlinger: Our next question comes from Brian Kinstlinger from Alliance Global Partners. Great. Thanks so much.

Thank you. Our next question comes from Brian Kiss Langer from Alliance Global Partners. Your line is open.

Speaker Change: Great. Thanks, so much.

Jihan Wu: I'm curious. at what level of tariffs? Would Bitdeer's decision to sell externally alter the strategy right now of timing? Is 30% something you're comfortable with, especially if semiconductors don't get reprieved? Just curious how that might impact your decision if 30% is the number. The tariff, we believe, in the end, it will be quite reasonable. I don't think there's... negotiation skills will be the ultimate tariff policy for the U.S. government. And it's very important that the chips produced by Taiwan I don't think it will be put up with high tariffs. So we have lots of ways to make our business viable, even inside the United States.

Speaker Change: I'm curious.

Speaker Change: At what level.

Speaker Change: Alright.

Speaker Change: Wade.

Speaker Change: <unk> decision to sell externally.

Speaker Change: <unk> alter the strategy right now of timing.

Speaker Change: 30% something you're comfortable with.

Speaker Change: Especially semiconductors don't get with free just curious how that might impact that decision that 30% is the number.

Speaker Change:

Speaker Change: Oh.

Speaker Change: In the end it will be quite reasonable I don't think.

Speaker Change: Yes.

Speaker Change: Negotiation.

Speaker Change: Scales will be the.

Speaker Change: I can make.

Speaker Change: Current potash.

Speaker Change: For the U S government.

Speaker Change: And.

Speaker Change: Okay.

Speaker Change: Very importantly that.

Speaker Change: The chips.

Speaker Change: Produced by Taiwan.

Speaker Change: I don't think it will be put out.

Speaker Change: Great Hi, Paris.

Speaker Change: So we have lots of ways.

Speaker Change: Ways to make our business viable.

Speaker Change: You mean inside the United States.

Jihan Wu: Um For example, we can ship the chips into the United States and do an assembly in the United States. That's a possible solution. We are evaluating right now. And secondly, we have capacity overseas in Norway, in Bhutan. It's Tobii as well, and there are low tariffs for such kind of products as well, so we can do our self money there. I think... Generally, tariffs will make more economic activity on the US soil. But of course, it's, it's not for efficiency and prosperity. It's more for self sufficient national security and more for creating jobs inside. So I think everyone, including us, has to compromise a little bit.

Speaker Change: For example, we can ship.

Speaker Change: Shifting to the NASDAQ.

Speaker Change: The assembly inside of that state.

Speaker Change: Thats a possible solution.

Speaker Change: How are you about anything right now.

Speaker Change: Yes.

Speaker Change: And then secondly, we have capacity overseas.

Speaker Change: In all our info time.

Speaker Change: Okay.

Speaker Change: Hello.

Speaker Change: And that there are no tariffs for us has kind of products as well.

Speaker Change: So we can do it all yourself money there.

Speaker Change:

Speaker Change: I think.

Speaker Change: Generally it's Harris will.

Speaker Change: Mike.

Speaker Change: More economic activity on the U S soil.

Speaker Change: But of course, it's.

Speaker Change: It's not for efficiency and prosperity.

Speaker Change: It's more for.

Speaker Change: Self.

Speaker Change: Sufficient national security on.

Speaker Change: More for creating jobs CSI.

Speaker Change: So I think everyone, including us has to compromise the database, but generally I think especially in the earlier I think it will be okay.

Jihan Wu: But generally, I think, especially in the early years, I think it will be okay.

Speaker Change: Uh huh.

Operator: A follow-up I have. In terms of demand, and I think you guys have taken deposits, what percentage of that comes outside of the United States in the demand trace? roughly, if you could. Most of you right now are from the United States. Great. Thank you. As a reminder, to ask a question, please press star 1.

Speaker Change: Great a follow up I have in terms of demand and I think you guys had taken deposit.

Speaker Change: What percentage of that comes outside of the United States and the demand for Asics.

Speaker Change: Roughly viewpoint.

Speaker Change: Most of them you ran out of from United States.

Speaker Change: Great. Thank you.

Speaker Change: Thank you as a reminder to ask a question. Please press star one one.

Bill Papanasu: Our next question comes from Bill Papanasu with KBW. Your line is open. Good morning, gentlemen, and congrats on all the progress. Just a quick question for me here.

Speaker Change: Our next question comes from Bill <unk> with <unk>. Your line is open.

Bill: Yes, good morning, gentlemen, and congrats on all the progress just a quick question for me here.

Jihan Wu: As a follow up to that prior to our question, perhaps you can speak to how customer interest has trended recently for the upcoming sealed miners. You know, we've seen a number of Bitcoin mining companies pull back. Capital Expenditure for Bitcoin Mining. Furthermore, have you seen any shift in the composition of customer interest from North America to the rest of the world? following the recent tariff landscape. Could you see, do you think you could see a larger portion of customer sales in the future coming from that rest of world component?

Speaker Change: As a follow up to that prior term question, perhaps you can speak to how customer interest has trended recently for the upcoming C. All miners.

Speaker Change: We've seen a number of bitcoin mining companies pull back.

Speaker Change: Capital expenditure for Bitcoin mining.

Speaker Change: Furthermore, I have you seen any shift in the composition of insurance from North America to the rest of the world.

Speaker Change: Following the recent tariff landscape.

Speaker Change: Could you see do you say you could see a larger portion of.

Speaker Change: <unk> customer sales in the future coming from that rest of world component. Thank you.

Jihan Wu: Thank you. Well, on one side, U.S. based Bitcoin miners. have the best capital market in the world. They have the capability to reserve capital to expand their operations. I don't think this will change in the near future. But at the same time, Dilutions can be a little bit... unwelcomed in the market. That's what I perceived from those reviews and remarks. So, I think U.S.-based... Bitcoin Miners will start to find a way. to expand their operations without diluting their shared basis. And I'm feeling pretty... very fastly. I think that means there's a leverage, but leverage that we'll need to have confidence about.

Speaker Change: Ah well.

Speaker Change: On one side U S based they call minus.

Speaker Change: Has have.

Speaker Change: The best capital market in the World.

Speaker Change: They have the capability to returns of capital to expand into operation.

Speaker Change: I don't think this will change in the near future.

Speaker Change: But at the same time.

Speaker Change: Dilutions can be a little bit.

Speaker Change: On welcomed.

In the market.

Speaker Change: What I perceived from those reviews in her remarks.

Speaker Change: So I think U S based.

Speaker Change: The combined us will start to find a way.

Speaker Change: To expand on the outpatient without.

Speaker Change: Diluted.

Speaker Change: Yes.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: There are fastly.

Speaker Change: I think that it means that the leverage.

Speaker Change: Right.

Speaker Change: Rich.

Need to have confidence about.

Jihan Wu: to give you a future reporting revenues. with certain kinds of mining rigs. It involves lots of different departments, how to organize the capacity. So, kind of a transparency from the mining rig suppliers will be demanded, which... We are which Bitdeer cannot work out alone. So I think generally we are confident because the U.S. got a very upon energy, very good capital market, and have a culture of entrepreneurship to expand their business. The total hashrate. market share resides inside the United States. I think we will continue to grow from here, roughly 30%, maybe to even higher.

Speaker Change: Okay.

Speaker Change: Okay. Thanks for sharing any revenues.

Speaker Change: But.

Speaker Change: With certain kinds of mining.

Speaker Change: Okay.

Speaker Change: So lots of progress.

Speaker Change: Our idea of the capacity.

Speaker Change: So kind of transparency.

Speaker Change: In many ways Sop higher soybean demand data, which.

Speaker Change: We are.

Speaker Change: Which.

Speaker Change: You cannot walk out alone.

Speaker Change: So I think.

Speaker Change: Generally we are confident because you asked Scott very upon entity.

Speaker Change: Market.

Speaker Change: And if a culture of entrepreneurship to expand their business.

Speaker Change: The total cash rate.

Speaker Change: Market share.

Speaker Change: Precise in Sandy rest days I think we will continue to grow.

Speaker Change: <unk> has roughly 30%.

Speaker Change: Two even higher.

Jihan Wu: But, but I think it will take very flow time, it will increase as fast as part. U.S. has increased from nearly zero or very minimum hashrate. percentage to 30%. That's remarkable progress. Um, I think it will, it will, the growth of the market share of the United States will continue, but it will, I'd imagine, still pace.

Speaker Change: But.

Speaker Change: But I think it will vary.

Speaker Change: Sorry.

Speaker Change: <unk> increased.

Speaker Change: As fast as I.

Thats past.

Speaker Change: <unk> has increased from near zero or very minimum cash rate.

Speaker Change: Percentage to 30% of this remarkable progress.

Speaker Change: I think it will.

Speaker Change: The growth of the market share of the assets will continue but it will add a microscope.

Speaker Change: Okay.

Speaker Change: Yes.

Jihan Wu: Yeah, I'm not sure I answered your question. No, that's great. That's great color.

Speaker Change: Yes, Im not sure I understood.

Speaker Change: Alright.

Speaker Change: Yes.

Speaker Change: No that's great that's great color and then maybe as a follow up to that.

Jihan Wu: And then maybe as a follow up to that, we've seen a number of miners enter into ASIC option payment structures. in order to acquire an incremental amount of capacity. Is there any thought in terms of trying to entertain a similar type of structure at Bitdeer for the A4s or A3s down the road? You mean we buy the credit to our clients? Yeah, essentially, yeah. on Generally, we don't have a plan right now.

Speaker Change: We've seen a number of minors enter into a <unk> option.

Speaker Change: Structures.

Speaker Change: In order to acquire an incremental amount of capacity.

Is there any thought in terms of.

Speaker Change: Alright to entertain a similar type of structure at the tier four the eight floors or <unk> down the road.

Speaker Change: You mean.

Speaker Change: Either credit to our clients.

Speaker Change: Yes actually yes.

Speaker Change:

Speaker Change: Generally we don't have the panel.

Speaker Change: Okay.

Jihan Wu: So, we want to thank you, I hope, and now, we will all have a good night. ah Yeah. US is really good, but I don't think it's going to be the best. and Kevin. access to I just can't put on the market a really good financing. So, we will be working with a partner to develop an IT console too. solve this kind of problem. I think it's much more healthier than Bitdeer itself to provide such kind of a credit because because a lot, no, no, not some bad stories in the financial or business history, you start to provide such kind of credit to a client and such kind of capital goods by yourself.

Speaker Change: We will have to come by.

Speaker Change: Ill.

Speaker Change: No.

Speaker Change: Yeah.

Speaker Change: Yeah.

Speaker Change: U S is really good.

Speaker Change: Yes.

Speaker Change: Okay.

Speaker Change: Yes.

Speaker Change: Yes.

Speaker Change: Okay.

Speaker Change: Yes.

Speaker Change: How about that.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: Okay, and then market.

Speaker Change: Any good financing.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: Thank you we will be working with.

Speaker Change: Our partner.

Speaker Change: Okay.

Speaker Change: Two.

Speaker Change: To source desktop.

Speaker Change: Probably I think it's so much more help there.

Speaker Change: Then <unk>.

Speaker Change: Self to qualify us as kind of a credit.

Speaker Change: Okay.

Speaker Change: Because a lot of us no no nothing.

Speaker Change: All right.

Speaker Change: In the furniture business.

Speaker Change: Okay.

Speaker Change: Yeah.

Speaker Change: Start to progress that as kind of a credit to our client counts that kind of capital goods by ourself.

Operator: in May. distort the economic signal a lot. Appreciate the color, thank you so much. Thank you.

Speaker Change: In may.

Speaker Change: In may.

Okay.

Speaker Change: Thought.

Speaker Change: Economic signal a lot.

Speaker Change: Okay.

Speaker Change: I appreciate the color. Thank you so much.

Speaker Change: Sure.

Operator: I'm showing no further questions at this time. This does include the question and answer session, and you may now disconnect. Everyone, have a great day. Thank you. Thank you for watching!

Speaker Change: Thank you I'm showing no further questions at this time. This does conclude the question and answer session and you may now disconnect everyone have a great day.

Speaker Change: Thank you.

Speaker Change: Okay.

Speaker Change: [music].

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: Uh huh.

Okay.

Speaker Change: [music].