American Bitcoin Posts $126M Q3 Profit, Driven by $197M BTC Gain
American Bitcoin swung to about $126 million in Q3 net income on a $197.3 million digital asset gain. Strip it out and operations lost about $5.5 million, with mining revenue, margins and production all down while holdings rose to about 8,427 BTC.
About $126 million in third-quarter net income. A $57.2 million loss the quarter before. American Bitcoin (Nasdaq: ABTC) owes the swing to a $197.3 million gain on digital assets. The company, co-founded by Eric Trump, released results after the US market closed on November 4.
Strip out that gain and the picture changes. Operations lost about $5.5 million. Operating income was $191.8 million including the gain. In Q2, the digital asset line booked a $71.2 million loss.
CEO Mike Ho said on the earnings call that the gain was non-cash, reflecting Bitcoin's roughly 39% rise in Q3. Other expense included a $64.3 million loss on derivatives. Adjusted EBITDA came in at about $221 million, against a loss of about $45.0 million in Q2, per the company release.
Mining economics weakened
Core mining slipped on every key measure:
- Mining revenue: about $63.4 million, down from about $67.0 million in Q2.
- Gross margin: 41%, down from 49%. Gross profit was about $25.8 million versus $33.0 million.
- Cost to mine one BTC: about $42,100, up from $36,500, as seasonal power costs rose.
- Production: about 891 BTC, down from about 932 in Q2.
- Revenue per bitcoin mined: about $71,100, versus $71,900.
The company sold about 465 BTC to cover costs.
Treasury grew
Holdings rose about 425 BTC, or roughly 5%, to about 8,427 BTC as of Sept. 30. That includes about 3,090 BTC pledged for miner purchases under agreements with Bitmain. Satoshis per share rose about 5% to roughly 11,572 from about 10,989. The share count reflects a 1-for-15 reverse split effected July 2.
The owned fleet stood at about 89,242 miners with roughly 28.1 EH/s of capacity at quarter-end.
Ho framed the quarter around that reserve growth:
"Despite seasonal power cost pressures, we continued mining Bitcoin at a structural discount to spot, grew our strategic reserve, and increased Satoshis Per Share by approximately 5%, all without issuing shares through our ATM program or purchasing Bitcoin during the quarter,"
Mike Ho, CEO, American Bitcoin
Market backdrop
ABTC shares had fallen 5.6% from the prior close on November 4 before the release. Bitcoin held above $80,500 after the results, still 3.41% below its September 30 level with two months left in Q4. ABTC is majority-owned by Hut 8, which reported its own Q3 results the same day.
What it means
The headline profit is a mark-to-market story. The same exposure that produced a $197.3 million gain in Q3 produced a $71.2 million loss in Q2. With Bitcoin below its quarter-end level, Q4 starts with the wind reversed. Can further price gains keep paper profits ahead of higher power costs and thinner margins? That is the open question.
The pattern is not unique to miners. Coinbase's $719M Q3 profit also leaned on roughly $715 million in crypto holding gains, with adjusted net income at $78 million.
