American Bitcoin reported a quarterly net income of $126 million on Wednesday, but the profit was largely driven by a $197.3 million noncash gain on its Bitcoin holdings, according to its financial statements. Excluding that gain, the company would have posted an operating loss of approximately $5.5 million.
Mining Revenue and Costs
Mining revenue fell 5.5% to $63.4 million from the previous quarter, while the cost to mine one Bitcoin rose about 15% to $42,100. The company also recorded a separate $64.3 million loss on derivatives.
Gross mining profit dropped to $25.8 million from $33 million in the prior quarter, and the reported mining margin narrowed to 41% from 49%. American Bitcoin mined 891 BTC during the quarter, down from 932 BTC in the previous three months. The company attributed higher electricity prices as the main reason for increased mining costs.
CEO Mike Ho said in the earnings announcement, “Despite seasonal power cost pressures, we continued mining Bitcoin at a structural discount to spot.”
Earnings per share stood at $1.73, beating analysts’ consensus estimate of $0.26, according to Yahoo Finance data. However, quarterly revenue of $63.4 million fell short of analysts’ estimates of $74.35 million, a gap of nearly 15%.
Stock and Bitcoin Prices
Bitcoin was trading at $76,119, down 5% over the past 24 hours as of 8:50 p.m. UTC, according to CoinGecko data. Shares of American Bitcoin (ABTC) closed Thursday down about 15% at $5.31.
Competitors Pivot to AI
The results highlight a divide among Bitcoin miners: while American Bitcoin continues mining and holding BTC, competitors like Riot Platforms, MARA Holdings, and Core Scientific are investing in AI to find new revenue sources. Riot is building large AI data centers, MARA is expanding into AI while continuing to mine Bitcoin, and Core Scientific has already shifted much of its business toward AI data centers.
American Bitcoin, by contrast, continues building its BTC reserves, holding 8,427 BTC at the end of September, up from 3,418 BTC a year earlier.
Analyst Perspective
David Gamble, founder of asset management company Enigma Holdings, which focuses on Bitcoin mining and AI infrastructure, said American Bitcoin’s reported profit does not tell the full story of its mining business.
“Ultimately, mining Bitcoin below its market price doesn’t automatically mean you’re creating shareholder value,” Gamble told Cointelegraph. “I don’t necessarily think their accumulation strategy is flawed, but I do think it raises questions about long-term sustainability,” he added, pointing to increasing mining difficulty and the need to keep investing in newer and more efficient technology to compete.
Gamble also noted that the real competitive advantage in the industry is shifting toward energy infrastructure. “It’s no longer just about how much Bitcoin you can mine or how much hashrate you can deploy,” he said. He explained that Bitcoin miners and AI companies are competing for the same power supply, and AI data centers could make more money than Bitcoin mining in some areas. “That doesn’t mean every mining facility can simply transition into AI,” he said. “You still have to account for depreciation, equipment replacement, financing costs, and the opportunity cost of deploying that capital elsewhere.”
