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MARA Holdings - $MARA - Earnings Analysis: Strong financial results driven by higher average Bitcoin prices.

By sagebytes in Technology —

Business Model

MARA generates revenue primarily through mining Bitcoin and, to a lesser extent, providing hosting services. They are transitioning to a vertically integrated model.

Revenue Sources

  • Bitcoin mining: Primarily through block rewards and transaction fees.
  • Hosting services: Revenue generated from providing hosting services to other entities (result of site acquisitions in 2024)

Income Statement Analysis

  • Total Revenue increased by 36.76% due to an increase in the average price of BTC mined, offset by a decrease in BTC production.
  • Operating Income increased by 84.27% due to change in fair value of digital assets and increase in revenues
  • Net Income increased significantly by 247.94% primarily driven by an increase in operating income and income on digital assets.
  • Basic earnings per share increased by 102.99%

Balance Sheet Analysis

  • Total Assets significantly increased, demonstrating growth in the company's resources.
  • Total Stockholders Equity increased, reflecting increased ownership value.
  • Total Liabilities has increased significantly because the company is in expansion phase with increased number of sites.

Cash Flow Analysis

  • The company's Operating activities has used cash in 2024 compared to 2023. It can be attributable to increase in cost.
  • The company's Investing activities has used cash in 2024 compared to 2023. It can be attributable to expansion of sites.
  • The company's Financing activities provided cash in 2024 compared to 2023. It can be attributable to raising capital to fund company's growth.
  • The company has more cash at end of period compared to last year.

Capital Allocation

MARA is allocating capital towards vertical integration, energy generation, and strategic Bitcoin acquisitions. They're also exploring opportunities in AI, specifically inference at the edge. A hybrid approach to Bitcoin acquisition which balances mining with market purchases, leveraging converts

Management Commentary

Record-high revenue, net income, and Adjusted EBITDA for the full year and Q4 2024

Direct energy cost per bitcoin for 2024 was $28,801 from owned sites

Secured 300% more energy capacity, expanding our total energy portfolio to ~1.7 GW

Overall Sentiment: Optimistic, with emphasis on the company's transformation, strategic investments, and future growth opportunities in both Bitcoin mining and AI.

Disclaimer: This report is for informational purposes only and not investment advice. The analysis is based on limited information and subject to change. Investing in securities involves risks, including potential loss of principal. Past performance doesn't guarantee future results. Always conduct your own research, understand the risks, and consult a financial professional before making investment decisions.