To The Moon

$Riot Platforms(RIOT)$ is scheduled to release the results for the quarter ended December 2024.

This widely-known consensus outlook gives a good sense of the company's earnings picture. RIOT is expected to post quarterly loss of $0.18 per share in its upcoming report, which represents a year-over-year change of -156.3%.

Riot Platforms (RIOT) Last Neutral Earnings Call Give 10.69% Change Since

RIOT is able to give a 10.69% change to its share price despite a neutral earnings call they made on 30 Oct 2024. The earnings call presented a mix of positive growth in hash rate and revenue, alongside challenges with increased net losses, operational inefficiencies, and reduced future growth forecasts.

The positive aspects of strategic power management and increased Bitcoin holdings were countered by financial and operational hurdles.

Riot Platforms (RIOT) Guidance

During Riot Platforms' third quarter 2024 earnings call, the company provided numerous metrics reflecting their operational performance and future guidance. Riot increased its total deployed hash rate by 27% quarter-over-quarter, from 22 EH/s to 28 EH/s, meeting their quarter-end target and aiming to reach 35 EH/s by the year's end. The company produced 1,104 Bitcoin during the quarter, despite a 59% increase in Bitcoin network difficulty from the previous year. Financially, Riot reported a total revenue of $84.8 million, a 65% increase from Q3 2023, primarily due to higher Bitcoin prices, though gross profit decreased to $24.3 million from $37.7 million in the previous year. Their Bitcoin mining revenue was $67.5 million, up 116% year-over-year, with a gross profit margin of 42%. Riot's power strategy resulted in $12.4 million in power credits, reducing their all-in cost of power to $0.031 per kilowatt hour. The company ended the quarter holding 10,427 Bitcoin, up 42% from the end of Q3 2023. Riot's net loss for the quarter was $154.4 million, which included non-cash expenses like stock-based compensation and depreciation.

Looking forward, they revised their 2024 hash rate growth forecast to 35 EH/s and adjusted their 2025 target to 46.7 EH/s, citing longer lead times on substation equipment and strategic adjustments in Kentucky.

I believe investors would be watching how RIOT execute their energy strategy and also how the hash rate would be like in Q4 2024, we saw there is significant increase in Hash Rate in Q3 2024, where Riot increased its total deployed hash rate by 27% quarter-over-quarter from 22 EH/s to 28 EH/s, meeting the quarter-end target and is on track to reach 35 EH/s by year-end.

Factors That Could Affect Riot Q4 Earnings

Power Strategy Success

In Q3 2024, Riot generated $12.4 million in power credits, reducing all-in power costs to $0.031 per kilowatt hour, supporting the Texas grid during disruptions. We also saw in December 2024, power credits decreased 26% MoM to $1.0 million, so we need to watch how much power credits Riot generated for Q4 2024.

This is one concern that might continue, utilization rate improvements are ongoing with current rates over 80% but still below the target of 95%.

Revenue Growth Expected Due to Increased Bitcoin Holdings

Total revenue for Q3 2024 was $84.8 million, a 65% increase year-over-year, primarily driven by higher Bitcoin prices. Riot's net loss for Q3 2024 was $154.4 million or $0.54 per share, compared to a net loss of $80 million or $0.44 per share in Q3 2023.

ESS Metron reported a revenue decline to $12.6 million in Q3 2024 from $15.5 million in Q3 2023, due to supply chain constraints impacting contract completion. SG&A expenses for Q3 2024 were elevated at $36.4 million, driven by onetime M&A and litigation-related expenses.

Bitcoin’s price in Q4 2024 will heavily influence RIOT’s revenue. We saw how Bitcoin have performed in Q4 2024 :

October: Bitcoin started the quarter around $63,000 and ended around $70,000.

November: Bitcoin saw a significant jump, starting around $70,000 and ending around $96,000.

December: Bitcoin continued its upward trend, reaching over $100,000 and closing the year around $93,000.

Riot ended Q3 2024 with 10,427 Bitcoin, a 42% increase relative to the 7,327 Bitcoin held at the end of Q3 2023, and Riot held 17,722 Bitcoins in December 2024, with 5,784 Bitcoin acquired in December 2024. so we could see their mining revenue benefit.

Bitcoin Mining Revenue Surge To Continue

In Q3 2024, Bitcoin mining revenue totaled $67.5 million, a 116% increase relative to Q3 2023. With the Bitcoin price reaching $100,000 in December, I am expecting Riot Bitcoin mining revenue to go above $67.5 million.

Riot Reduced 2025 Growth Forecast

Riot revised its 2025 year-end exit hash rate forecast from 56 EH/s to 46.7 EH/s due to longer lead times on substation equipment and prioritizing power capacity maximization. This is why RIOT’s ability to scale hash rate and maintain efficiency is critical to offsetting this.

Technical Analysis- Exponential Moving Average (EMA)

We need to understand that RIOT shares often mirror BTC’s price (beta ~2–3x). Post-earnings moves could hinge on BTC’s trend.

Currently I can say that RIOT is trading in a consolidation trend, and Bitcoin is trying to beat the $99,000 with few attempts in Asia trading hours, but fall short.

And we need RIOT bulls need to show more strength to break out of the 12-EMA and 26-EMA, they are converging so this might mean if there is any short interest, we could be seeing a ~15% of float (as of late 2024), raising risk of a squeeze on positive news.

RIS is also not showing much momentum to support any strength.

Summary

I think we are still looking at how RIOT would be managing its energy strategy and how it could continue to work on increasing the hash rate, if Bitcoin could provide a short rally towards $100,000 next week, we might see some strong momentum coming back to the RSI.

I will be holding back to load RIOT as part of my crypto stocks holdings.

Appreciate if you could share your thoughts in the comment section whether you think RIOT could beat estimates with Bitcoin price strength in the Q4 and whether their hash rate have increased significantly.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.