Marathon Digital NASDAQ: MARA outlined a strategy to expand beyond Bitcoin mining into AI-focused digital infrastructure, while reporting lower second-quarter revenue and a net loss driven largely by a decline in the value of its Bitcoin holdings.
Chairman and CEO Fred Thiel said the company is positioning its power, land and compute assets to address growing demand for AI data-center capacity. He described power availability as a central constraint for AI infrastructure and said MARA’s experience operating 19 data centers across four continents gives it an established base from which to pursue the opportunity.
“The question is no longer who can fund the next wave of compute, it is who has the power,” Thiel said. “That question goes directly to MARA’s strengths.”
Power portfolio expansion
MARA advanced its pending acquisition of Long Ridge and, after the quarter ended, acquired rights to a 1,200-acre powered-land site in Matagorda County, Texas. The Texas site could support up to 2 gigawatts of capacity, subject to ERCOT and interconnection approvals.
Upon completion of the Long Ridge transaction and the required approvals, MARA expects its power portfolio to reach about 4.8 gigawatts, more than doubling its current capacity. Thiel said the Matagorda location could provide sufficient wholly owned capacity to support a transition away from hosted mining as existing agreements expire.
The company said its largest third-party hosting arrangements are scheduled to begin expiring in the third quarter of 2027, with all such arrangements ending by the first quarter of 2028. MARA expects the shift toward owned capacity to eliminate third-party hosting costs and improve its cost per kilowatt-hour.
Thiel said MARA is in lease discussions with prospective AI and high-performance computing customers across multiple sites and remains confident it can sign at least two leases before year-end. He said discussions related to the Hannibal campus are proceeding despite the pending Long Ridge closing, including work on prospective tenants’ facility design, fiber and permitting requirements.
Regarding the Long Ridge deal, Thiel said MARA had not received feedback from regulators but did not believe there was anything expected to block approval. The company expects a Federal Energy Regulatory Commission response before year-end, and said it expects it sooner.
Long Ridge financing and expected contribution
Chief Financial Officer Salman Khan said MARA secured approval from holders of Long Ridge’s senior secured notes to assume the notes at closing. Following the quarter, the company also entered into two Bitcoin-backed credit facilities with Coinbase and Two Prime, providing up to $600 million of incremental borrowing at a weighted average cost of debt of 7.56%.
MARA refinanced and consolidated an existing $150 million Coinbase facility into the new Coinbase facility. The prior borrowing, which had been due in the first quarter of 2027, will now mature in two years along with the additional borrowings.
Khan said the company plans to use the facilities, along with assumed Long Ridge indebtedness, to fund the acquisition. He described the transaction as a $1.5 billion enterprise-value acquisition financed through Bitcoin-backed debt and the assumption of Long Ridge’s balance-sheet obligations.
Once completed, MARA expects Long Ridge to contribute about $144 million of annualized EBITDA and durable free cash flow. Roughly 70% of Long Ridge’s power output is secured under long-term contracts, according to the company.
At quarter-end, MARA had $421.3 million in cash and cash equivalents and about $2.5 billion in combined cash and Bitcoin. It held 35,577 Bitcoin, valued at roughly $2.1 billion based on a $58,524 spot price. About 26%, or 9,270 Bitcoin, were loaned or pledged as collateral at the end of the quarter. Khan said that following the new financing, 54% of the company’s Bitcoin holdings had been pledged as collateral under its borrowings.
Second-quarter financial results
Revenue for the second quarter was $174.9 million, down from $238.5 million in the prior-year period. Khan said Bitcoin production contributed a $7.2 million year-over-year revenue increase, but that benefit was offset by a 28% decline in Bitcoin’s average price, which reduced revenue by $65.9 million. Other revenue declined by about $4.9 million, primarily due to lower digital-asset revenue and the elimination of hosting services.
- MARA mined 2,422 Bitcoin during the quarter, or 26.6 Bitcoin per day, up about 64 Bitcoin from the prior-year period.
- The company won 700 blocks, up 1% year over year and 8% sequentially.
- Energized hashrate was 70.3 exahash per second, up 22% from 57.4 exahash per second a year earlier.
- Its share of available mining rewards reached 5.9%, compared with 5.5% in the first quarter.
MARA reported a net loss of $611.3 million, or $1.60 per diluted share, compared with net income of $808.2 million, or $1.84 per diluted share, a year earlier. Khan said approximately $343 million of the quarterly net loss stemmed from an unrealized fair-value adjustment on digital assets following the decline in Bitcoin’s price.
Adjusted EBITDA was negative $360.9 million, compared with $1.2 billion in the prior-year quarter, also reflecting the Bitcoin mark-to-market change. Khan said each $10,000 change in Bitcoin’s price produces an approximate $350 million impact on the fair value of digital assets reported in MARA’s income statement.
Exaion and technology initiatives
Thiel said MARA’s Exaion business is intended to serve the sovereign AI infrastructure market, particularly European enterprises and public-sector organizations that require data, infrastructure and operations to remain governed under European jurisdiction. Exaion operates critical infrastructure supporting EDF’s nuclear reactor operations and was selected for the EON consortium, an EU-backed initiative targeting approximately 3 gigawatts of AI-ready data-center capacity, he said.
During the question-and-answer session, Thiel said Exaion’s revenue for 2026 is expected to be in the “low eight digits” and should grow as the business adds customers beyond EDF. He also said MARA’s Hashrate Under Management platform has no contractual revenue and is not expected to be material to overall revenue in the near term, though he characterized it as an eight-digit annualized business.
The company also highlighted Vertebra AI, a platform developed to manage power allocation and infrastructure performance in real time. Thiel said the technology has helped MARA add computing capacity within the same electrical footprint and could have applications in AI data centers, power generation and data-center commissioning.
About Marathon Digital (NASDAQ:MARA)
Marathon Digital Holdings, Inc is a digital asset technology company specializing in the mining and acquisition of bitcoin. Headquartered in Las Vegas, Nevada, the firm employs high-performance application-specific integrated circuit (ASIC) miners and proprietary software to secure the Bitcoin network and expand its crypto-mining footprint. Marathon Digital focuses on operational efficiency and scalability, while maintaining rigorous standards for regulatory compliance and corporate governance.
The company operates multiple large-scale mining facilities throughout North America, including sites in Texas, Montana and New York.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
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