Bitcoin Miner Riot Takes $349M Goodwill Impairment Charge on Acquisitions

by Aaryamann Shrivastava
7 ways to make with crypto

Bitcoin Miner Riot Takes $349M Goodwill Impairment Charge on Acquisitions

Aoyon Ashraf is crypto mining reporter with more than a decade of experience in covering equity markets

Riot Blockchain (RIOT), one of the largest publicly traded bitcoin miners, recorded $349.1 million in impairment charges to goodwill in the second quarter, tied to its acquisitions of miner Whinstone U.S. and electrical equipment provider ESS Metron in 2021, in its second-quarter earnings released on Monday after the close. It also reported an impairment charge of $99.8 million on its bitcoin holdings.

Large impairment changes have been a common occurrence for miners as the prices of cryptocurrencies have plummeted this year. Most recently, peer Marathon Digital (MARA) said it booked $127.6 million impairment changes in the second quarter due to the decline in the prices of digital currencies.

“Although challenging global market conditions in the second quarter, further impacted by a steep decline in the price of Bitcoin and resulting decline in market valuations for publicly-traded Bitcoin miners, including Riot, necessitated non-cash impairment charges this quarter, these non-cash charges had no impact on our solid financial position and ample liquidity, both of which were further strengthened this quarter,” said CEO Jason Les in a statement.

The miner was scheduled to report its earnings last week, when most of its peers released their results. However, Riot said on Aug. 9 that it delayed its quarterly earnings report because it needed more time to calculate how much the cryptocurrency rout, the war in Ukraine and other macroeconomic issues have reduced the value of its assets.

Riot maintained its hash rate growth guidance of about 12.5 exahash per second (EH/s) by the first quarter of next year, which it first forecasted on Aug. 3.

Riot also reported total first quarter revenue of $72.9 million, missing consensus estimate of $75.5 million, according to FactSet data. It currently has 44,720 bitcoin miners, with a hash rate capacity of 4.4 EH/s.

Riot shares fell about 6% on Tuesday. Its stock has fallen about 60% this year, in-line with its mining peers, while bitcoin’s price has been cut nearly in half.

7 ways to make money in crypto

You may also like

Leave a Comment

The latest news about crypto industry at Coingraph. Most recent news about bitcoin, altcoin, blockchain, mining, cryptocurrency prices and more.

 

Email: [email protected]

© 2022 Coingraph.org – All rights reserved.