MARA Holdings (MARA) Stock Falls After Q1 Revenue Miss and $1.3B Loss

TLDR

• MARA Q1 revenue fell 18% year-over-year to $174.6 million, missing the $192.7 million Wall Street estimate
• Net loss widened to $1.3 billion, driven largely by unrealized losses on its Bitcoin treasury
• MARA sold roughly $1.1 billion in Bitcoin near quarter-end to retire debt and improve liquidity
• The company is pivoting toward AI and high-performance computing, including a $1.5 billion acquisition of Long Ridge Energy & Power
• MARA says it will no longer pursue large-scale Bitcoin mining hardware purchases

MARA Holdings posted a rough first quarter, with revenue and earnings both coming in below expectations. MARA stock dropped 3.44% in after-hours trading Monday to $13.04, wiping out a 3.48% gain from the regular session.

Marathon Digital Holdings, Inc., MARA

Revenue for the quarter ending March 31 came in at $174.6 million, down 18% from $213.9 million a year ago and short of the $192.7 million analysts had expected.

The net loss for the quarter hit $1.3 billion, more than double the $533.4 million loss reported in the same period last year. Earnings per share came in at a loss of $3.31, well below the consensus estimate of a loss of $2.20.

The bulk of those losses came from unrealized losses on its Bitcoin holdings. Bitcoin fell roughly 23% during the quarter, which hammered the value of MARA’s 38,689 BTC treasury.

Near the end of March, MARA sold more than 15,100 Bitcoin for around $1.1 billion. The company said the move was made to retire debt and improve financial flexibility. The sale dropped MARA from the second- to fourth-largest public Bitcoin treasury company.

MARA expanded its energized hashrate 33% year-over-year to 72.2 EH/s and mined 2,247 BTC during the quarter, up from 2,011 BTC in the previous quarter — a bright spot in an otherwise difficult report.

Pivoting Toward AI

While Bitcoin mining is still described as the company’s “operational foundation,” MARA is clearly building out a parallel strategy.

Its AI push centers on two main moves: a partnership with Starwood Capital to convert existing mining sites into AI and high-performance computing data centers, and the $1.5 billion acquisition of Long Ridge Energy & Power, a gas-fired power plant and data center campus in Ohio announced in late April.

Management said Long Ridge could eventually support more than 600 megawatts of AI computing capacity.

MARA also said around 90% of its non-hosted mining capacity could be redirected toward AI and IT infrastructure if market conditions support it. The strategy is built around flexibility — keep mining Bitcoin now, but have the option to flip the switch toward AI when the economics make sense.

Mining Hardware Expansion on Pause

In a clear shift in direction, MARA said it does not plan to make large-scale purchases of ASIC mining hardware going forward.

That’s a change in tone from previous years when MARA aggressively scaled its mining operations. The company has also lost ground competitively, sliding from the largest Bitcoin miner by market cap to seventh place as rivals pushed harder into AI infrastructure.

MARA stock is down about 16% over the past 12 months. Bitcoin is currently trading more than 35% below its all-time high of $126,080, and mining difficulty has risen nearly 30% over the past year, keeping pressure on miner margins across the sector.

The company’s next move to watch is how quickly Long Ridge can be converted to support AI workloads, which management has flagged as a key part of their forward-looking infrastructure plan.

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