HIVE Digital Technologies NASDAQ: HIVE reported a wider fiscal second-quarter loss as lower Bitcoin mining economics prompted an equipment impairment, even as revenue and adjusted earnings improved from the preceding quarter and its artificial intelligence infrastructure business expanded.
Revenue for the quarter ended Sept. 30, 2026, was $84.9 million, down about 3% from $87.3 million a year earlier but up approximately 7% from the first quarter. The company posted a net loss of $78.7 million, or $0.29 per share, compared with a $15.8 million loss, or $0.07 per share, a year earlier.
Adjusted EBITDA was $24.8 million, down from $31.5 million a year earlier but up from $13.4 million in the preceding quarter. Gross operating margin declined to $30.2 million from $42.4 million a year earlier, while improving from $24.2 million in the first quarter.
Mining impairment weighs on results
Chief Financial Officer Darcy Daubaras said the quarterly loss included a $31.2 million non-cash impairment of mining equipment, $54.9 million in depreciation, $8.6 million in share-based compensation and a $7.3 million loss from changes in the fair value of derivatives.
The impairment followed a decline in mining revenue per unit of computing power and lower market values for specialized mining equipment known as ASICs, Daubaras said. Those factors reduced expected recoverable cash flows and residual values.
“The impairment is not a cash outflow this quarter, but it should not be dismissed,” Daubaras said. “It reflects a reassessment of the recoverability of our mining assets.”
The company’s net loss narrowed from $142.9 million in the first quarter, but Daubaras cautioned against treating the reduction as a like-for-like operating improvement. The prior quarter included a substantial Swedish regulatory provision, while the latest period included the equipment impairment.
HIVE generated $76 million in Bitcoin mining revenue during the quarter and produced approximately 1,070 Bitcoin equivalent. Its gross mining margin was 34%, according to President and CEO Aydin Kilic.
AI revenue rises as HIVE pursues new contracts
High-performance computing and AI services contributed $8.9 million in quarterly revenue, Daubaras said. Kilic put the segment’s gross operating margin at approximately 51% and said its annual recurring revenue had reached $40 million as of the call, up from a $35 million annualized level during the quarter.
Kilic said HIVE is targeting approximately 80% EBITDA margins on its newer GPU cloud deals, although the business is still scaling and incurring costs to support growth. That target is a different measure from the segment’s reported gross operating margin.
The CEO said active and contracted GPU cloud revenue totaled $185 million on an annual recurring basis, with a target of reaching $200 million. He said the company would provide an update on a planned cluster of 504 B300 GPUs intended to help reach that target. The revenue figures include contracts that have not yet come online.
HIVE has signed a letter of intent for a long-term colocation deal at its 32-megawatt Boden site in Sweden, but a definitive agreement remains under negotiation. Kilic said the prospective customer is investment grade and that HIVE is discussing terms such as termination rights and deposits while working on financing.
“We don’t want to rush into a deal just for the sake of reporting new top-line revenue,” he said.
The company also plans to develop its Toronto Airport data center, with a budget of approximately $40 million for 5 megawatts of IT load. Kilic said HIVE could use the site for colocation or its own GPU cloud business, and that the company intends to bring it online in 2027. HIVE has expanded its New Brunswick campus to 64 acres and will provide updates on its choice of customer arrangement and financing there, he said.
Cash preservation takes priority
HIVE ended September with $139 million in cash and $22.6 million in digital currencies, including 269 Bitcoin. Cash declined from approximately $208 million at June 30 as the company invested in infrastructure and growth. Current liabilities included an $84.5 million provision related to a previously disclosed value-added tax matter, Daubaras said.
Kilic said HIVE would focus on deploying contracted GPU clusters and protecting its balance sheet amid market uncertainty. He said the company has announced a committed GPU loan to support its Cohere deal and expects to seek financing for Boden once a lease is signed.
On Bitcoin mining, Kilic said HIVE’s global capacity is full. Rather than pursue a major expansion, the company may make small, opportunistic purchases of more efficient machines to replace older equipment when prices offer an attractive return, he said.
About HIVE Digital Technologies (NASDAQ:HIVE)
HIVE Digital Technologies Ltd. is a digital asset infrastructure company focused primarily on Bitcoin mining and the operation of data centers. The company uses specialized computing equipment and energy infrastructure to support cryptocurrency mining, while also developing facilities designed to accommodate high-performance computing and artificial intelligence applications.
Founded as HIVE Blockchain Technologies, the company adopted the HIVE Digital Technologies name in 2023 to reflect its broader focus beyond cryptocurrency mining.
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