Riot Platforms, Inc. has filed a current report on Form 8-K to recast certain financial information and related disclosures included in the 2023 Form 10-K to reflect the elimination of its legacy data center hosting reportable segment. The data center hosting segment was eliminated following the termination of all contracts with the company’s data center hosting and colocation customers as of January 1, 2024.
As a vertically integrated bitcoin mining company, Riot Platforms operates in two reportable business segments: bitcoin mining and engineering. In the bitcoin mining segment, the company operated 112,944 miners with a total hash rate capacity of 12.4 exahash per second ("EH/s") as of December 31, 2023. In 2023, Riot Platforms mined 6,626 bitcoin, representing a 19.3% increase over the 5,554 bitcoin mined in 2022.
The company anticipates having approximately 28 EH/s of total hash rate in operation by the end of 2024. Riot Platforms entered into a long-term master purchase and sales agreement with MicroBT Electronics Technology Co., Ltd, through its manufacturing affiliate, SuperAcme Technology (Hong Kong) Limited, to secure the long-term supply of state-of-the-art immersion miners. The company executed two purchase orders under the master agreement to acquire a total of 99,840 new MicroBT miners for a total purchase price of approximately $453.4 million in 2023.
Riot Platforms also transitioned to a "full-pay-per-share" payout type of mining pool in December 2022 and utilized it for the year ended December 31, 2023. The initial phase of the development of the Corsicana facility involves the construction of 400 megawatts of immersion-cooled bitcoin mining infrastructure.
In the engineering business segment, Riot Platforms designs and manufactures power distribution equipment and custom engineered electrical products. The segment also provides electricity distribution product design, manufacturing, and installation services primarily focused on large-scale commercial and governmental customers.
The company faces competition in the highly competitive bitcoin mining space. It relies on a mining infrastructure that can supply large amounts of reliable, low-cost electricity, with the ability to execute on miner deployments with the best-in-class mining infrastructure to generate the highest returns while incurring the lowest costs to mine. Riot Platforms has entered into long-term power purchase agreements with its energy supplier at the Rockdale facility to control its power costs and project them over a long-term.
Throughout 2022 and 2023, Riot Platforms observed several companies in the bitcoin ecosystem experience significant challenges and initiate bankruptcy proceedings due to the significant volatility in the price of bitcoin, the increase in interest rates, the volatility in spot prices of power, and other national and global economic conditions. The market has reacted to these announcements by moving the company's shares -2.8% to a price of $8.06. For more information, read the company's full 8-K submission here.
