Analysts eye Bitcoin miners’ AI, chip sales ahead of Q4 earnings

Investors Eye Revenues from AI Computing and Chip-Making in Top Bitcoin Mining Stocks’ Fourth Quarter Earnings Releases

Miners’ Non-Core Business Lines Take Center Stage as Network’s April 2024 Halving Erodes Bitcoin Mining Revenues

As top Bitcoin mining stocks prepare to release their fourth-quarter earnings, investors are keenly eyeing revenues from artificial intelligence (AI) computing and chip-making, according to several analyst notes reviewed by Cointelegraph. With the network’s April 2024 halving event reducing mining rewards, miners are seeking to diversify their revenue streams by leveraging their computing power and expertise to capitalize on the growing demand for AI and high-performance computing (HPC) services.

Riot, Bitdeer, Marathon, and Core Scientific Report Earnings

Riot Platforms (RIOT) and Bitdeer (BTDR) are set to release their earnings on February 24 and 25, respectively, while Marathon Digital (MARA) and Core Scientific (CORZ) will report their results on February 26. In November, Riot, Bitdeer, and Marathon reported lower-than-expected earnings as they grappled with lower post-halving Bitcoin (BTC) mining margins.

Analysts Optimistic on Adjacent Business Lines

Analysts are optimistic that adjacent business lines, including leasing out high-performance hardware to AI models and selling specialized ASIC microchips, will more than offset any revenue losses. Bitdeer, for instance, has created a new business line selling its specialized hardware, and analysts at H.C. Wainwright & Co. are "encouraged" by the strong demand for the company’s first internally developed ASIC available to external customers.

Related: Bet More on the Bitcoin Miners Cashing in on AI

Adjacent Business Lines

Analysts at H.C. Wainwright & Co. noted that they were "encouraged to hear that demand for [Bitdeer’s] first internally developed ASIC available to external customers has been strong out of the gate" during the company’s third-quarter earnings call in November. They rated Bitdeer’s stock a "buy," citing the miner’s "overlooked" potential to disrupt the ASIC chip market, and raised their price target to $18. As of February 24, BTDR trades at around $13 per share, according to data from Google Finance.

Riot’s Plans for AI/HPC

Riot, on the other hand, "lowered its 2025 hashrate outlook for the second time since October 2024, as management has decided to halt planned BTC mining expansions to evaluate the feasibility of utilizing the remaining capacity at the site for AI/HPC," according to analysts at H.C. Wainwright & Co. Riot is also rated as a "Buy," with a $17 price target – significantly higher than RIOT’s $10 share price as of February 24, according to data from Google Finance.

Larger Miners Seek to Cut Costs

Larger miners are seeking to cut costs by scaling capacity, including by acquiring power supplies and data centers. Bitdeer, for instance, plans to spend $100 million to build an in-house power plant and data center in Alberta, Canada, according to H.C. Wainwright analysts.

Conclusion

As top Bitcoin mining stocks prepare to release their fourth-quarter earnings, investors are focusing on the potential for miners to generate revenue from AI computing and chip-making. With the network’s April 2024 halving event reducing mining rewards, miners are diversifying their revenue streams by leveraging their computing power and expertise to capitalize on the growing demand for AI and HPC services.

FAQs

Q: What is the significance of the April 2024 halving event?
A: The April 2024 halving event reduces the number of BTC mined per block, eroding mining revenues.

Q: How are miners responding to the halving event?
A: Miners are diversifying their revenue streams by leveraging their computing power and expertise to capitalize on the growing demand for AI and HPC services.

Q: What is HPC, and how does it relate to AI?
A: HPC refers to high-performance computing, which is used to power AI models. The demand for HPC is surging, creating opportunities for Bitcoin miners to generate revenue.

Q: What is the significance of the increasing demand for HPC?
A: The increasing demand for HPC is creating opportunities for Bitcoin miners to generate revenue by providing high-performance computing services to AI models.