ALBANY, N.Y.–(BUSINESS WIRE)–Soluna Holdings, Inc. (“SHI” or the “Company”), (NASDAQ: SLNH), the parent company of Soluna Computing, Inc. (“SCI”), a developer of green data centers for cryptocurrency mining and other intensive computing, reported financial results for the third quarter ended September 30, 2022.
Michael Toporek, CEO of Soluna Holdings, Inc., said, “In the quarter, Soluna continued to execute on our business plan delivering healthy hashrate and cash contribution margins despite low BTC prices and energy market volatility. We continue to focus our resources on energizing Project Dorothy, which we expect to double our existing operating footprint. Our team is working with ERCOT to finalize the details for an energization date. Dorothy is anticipated to be one of the lowest cost facilities of its kind in North America.”
Third Quarter 2022 Financial Results
Key Financial Highlights for the third quarter include
- Total revenue of $6.4 million for the three-month period ended September 30, 2022, as compared to $3.1 million for the same year-over-year period. The increase was driven primarily by an additional site operating in 2022.
- BTC equivalent mined increased 12.4% from the second quarter ended June 30, 2022. Peak hashrate remained above 1 EH/s during the quarter.
- Cryptocurrency mining revenue of $5.4 million for the three-month period ended September 30, 2022, as compared to $2.0 million for the same year-over-year period. Megawatts deployed increased from approximately 2 megawatts at the beginning of 2021 to 20 megawatts for the Calvert City facility and 25 megawatts for the Murray facility in 2022.
- Data hosting revenue of $1.0 million for the three-month period ended September 30, 2022, as compared to $1.1 million for the same year-over-year period. Compared to one year ago, hosting revenues now exclude any component related to power costs, which are treated as a pass-through item.
- General and administrative (“G&A”) expenses, excluding depreciation and amortization, totaled $5.7 million for the three-month period ended September 30, 2022 compared to $2.3 million for the three-month period ended September 30, 2021. Of the $3.4 million increase, $1.3 million was due to an increase in personnel and $1.1 million due to certain complex transactions including Dorothy and the convertible note amendments.
- Net Loss for the quarter of $(55.9) million, or $(3.94) per share, for the three-month period ended September 30, 2022, as compared to a net loss of $(0.6) million, or $(0.06) per share during the same year-over-year period, and compared to a net loss of $(6.6) million, or $(0.57) per share in the second quarter. Net loss for the quarter was materially impacted by the impairment of fixed assets ($28.1 million) and a loss on extinguishment of debt ($12.3 million).
- Non-GAAP Adjusted EBITDA for the quarter ended September 30, 2022 was a loss of ($3.6) million during the three-month period ended September 30, 2022.
Revenue & Contribution Margin Summary
*all numbers below exclude legacy hosting
Dorothy Facility Update and Potential Contribution
Once the Company energizes Dorothy, anticipated to be one of the lowest cost facilities of its kind in North America, it will continue to refine the economic model of the first 50MW of this 100MW site. The table below updates a recent illustration of the earnings power of the site for current economic conditions, including current Bitcoin pricing and network hashrate.
Illustrative Monthly Earnings Power of Dorothy
(Bitmain XP chips, $ in 000)
Note: Represents non-GAAP financial metrics and forward looking statements.
Note: Assumes $17k BTC price, 270 EH / s network hash rate, 90% capacity factor, 95% availability factor, and estimated $35 / kWh average annual power costs (including assumed seasonal demand fees and taxes). Hosting contract based on $60 / kWh fixed rate. Assumes that purchased and hosted machines are 140 Th/s Bitmain XPs.
A presentation detailing the Q3 2022 earnings can be found on the company website at www.solunacomputing.com/investors/
About Soluna Holdings, Inc (SLNH)
Soluna Holdings, Inc. is the leading developer of green data centers that convert excess renewable energy into global computing resources. Soluna builds modular, scalable data centers for computing intensive, batchable applications such as cryptocurrency mining, AI and machine learning. Soluna provides a cost-effective alternative to battery storage or transmission lines. Soluna uses technology and intentional design to solve complex, real-world challenges. Up to 30% of the power of renewable energy projects can go to waste. Soluna’s data centers enable clean electricity asset owners to ‘Sell. Every. Megawatt.’
Forward Looking Statements
The statements in this press release with respect to the progress of Soluna’s development pipeline and the ability to scale the Dorothy project to assist partner organizations constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements reflect management’s current expectations, as of the date of this press release, and are subject to certain risks and uncertainties that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Actual results could differ materially from those expressed or implied by such forward-looking statements as a result of various factors, including, but not limited to: (1) those risk factors set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and other reports filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. Except as required by law, the Company assumes no obligation to update or revise any forward-looking statements.
Philip F. Patman, Jr.
Chief Financial Officer
Soluna Holdings, Inc.
Brian M. Prenoveau, CFA
MZ Group – MZ North America
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