Hut 8 Mining (TSX:HUT) reported its first quarter 2022 financial results on Thursday morning. The digital asset mining company produced 19.4% more Bitcoin during the quarter ended March 31, 2022.

Strong Revenue and Profitability

Bitcoin production in the quarter was 942 Bitcoin, an increase of 75% compared to 539 Bitcoin in the previous quarter. Revenue increased 67% to $53.3 million in the first quarter. Hut 8’s self-mining operations generated $49.3 million in revenue from 942 Bitcoin mined. The average revenue per Bitcoin mined during the quarter meanwhile reached $52,327.

Cost of revenue for the three-month period was $36.9 million, resulting in an overall gross profit of $16.5 million. After general and administrative expenses of $11.5 million, Hut 8 posted an operating profit of $4.9 million.

Net income was $55.7 million and net income per share was $0.33 in the first quarter, compared to net income of $19.1 million and net income per $0.17 share for the same period in 2021. 

Results were boosted by a $54.1 million gain on the revaluation of warrants liabilities, which resulted in an overall net income of $55.7 million ($0.33 per share) for the three-month period, compared to net income of $19.1 million ($0.17 per share) in the prior year quarter. Adjusted EBITDA stood at $27.1 million, up from $16.2 million a year ago.

Bitcoin holdings increased 17% to 6,460 Bitcoin, with a market value of $367.6 million as of March 31.

Hut 8 CEO Jaime Leverton commented: “We made measurable progress in the first quarter of 2022, significantly advancing our diversification strategy by completing the acquisition of five data centres and cementing our role as the only digital asset mining company that is delivering the high performance computing infrastructure to support companies in the blockchain and Web 3.0 spaces. Thanks to our leadership role in the digital asset mining industry backed by our HODL strategy, we are uniquely positioned to seize opportunities in this burgeoning industry as they arise.”

TeraGo’s Acquisition Contributes to Revenue

The acquisition of TeraGo Inc.’s cloud services and colocation data centre business, which closed on January 31, 2022, established Hut 8 as a leader in high-performance computing, with five data centers in Ontario and British Columbia and approximately 400 commercial customers. The high-performance computing operation currently generates monthly recurring revenue of approximately $1.6 million.