Hut 8 Mining Corp., a Bitcoin mining company based out of Toronto, Canada, has had a rather solid second quarter for the year. In its quarterly earnings report, the company revealed that it had made a net profit of CAD33.7 million ($25.3 million) for Q2 2019, a result which fares much between to the CAD4.9 million ($32.6 million) net loss in the same period last year. This is great news for Hut 8 shareholders and crypto miners as a whole.
The earnings report showed that revenues had grown to CAD28.3 million ($21.3 million), up a staggering 262 percent from the CAD7.8 million ($5.88 million) it made in Q2 2018.
Andrew Kiguel, the chief executive of the company, said, “Q2-2019 represents Hut 8’s best quarter on all metrics since inception. We reduced our cost of mining to US$2,757 while the price of Bitcoin appreciated from US$4,158 at the beginning of the quarter to US$10,817 at the end of the quarter.”
Kiguel added that the firm had implemented some significant cost-saving measures at the end of 2018, with the aim of ensuring that it could carry the same cost structure in 2019 and turn a profit. Apparently, it did just that.
“Hut 8 remains committed to solely mining bitcoin and retaining an inventory of bitcoin for appreciation.” – Andrew Kiguel, CEO Hut 8 pic.twitter.com/F1dKrnPsTh
— Hut 8 Mining (@Hut8Mining) August 25, 2019
However, besides the work that had been done behind the scenes, the increase in Hut 8’s fortunes could also be a result of better performances across the board. Back in July, the mining giant announced that it had recorded the highest amount of Bitcoin mined on its platform.
According to a report on Yahoo! Finance, Hut 8 claimed in July to have mined up to 2,816 Bitcoins, while also having a Retained Bitcoin count of 3,250. Both numbers marked the highest quarterly amounts in the company’s history.
Yahoo! Finance reported that for Q2 2019, Hut 8 mined 2,816 Bitcoins, about 14 percent higher than the 2,405 it had mined in Q1 2019, and even more significantly higher than the 768 it mined in Q2 2018. As for Retained Bitcoin, the 3,250 count that the mining company reported was 635 more than what it had in Q1 2019
Given that the Bitcoin trading price at the time (June 30) was $10,817, its retained Value amounted to about $46 million. Speaking at the time, Kiguel also spoke on the company’s approach to their operations and how they had been able to see the results of some changes they had made.
“Hut 8’s strategy to only mine and retain Bitcoin, after paying its expenses, has resulted in substantial value creation for investors in the second quarter of 2019. In Q2-2019, we experienced lower electricity prices than in the prior quarter and a much-improved Bitcoin price.”
Hut 8s performance is undoubtedly indicative of how mining companies tend to be at the mercy of the price of Bitcoin themselves. A lot of mining companies had to close down in 2018, as they saw their stock trading down due to the crypto winter. However, given the rally that Bitcoin has had in 2019, the mining industry has had a bit of a renaissance.
Even Bitmain, one of the most widely affected mining firms, seems to be rebounding. As miners have begun to return to the activity, profits for mining companies have only continued to rise.