Greenidge announces third quarter update
DRESDEN--Greenidge Generation Holdings Inc. (NASDAQ: GREE), a vertically integrated cryptocurrency data center and power generation company, announced financial and operating results for the third quarter of 2022 and provided an operational update for the month that ended Oct. 31.
"Our third quarter results demonstrated our consistently strong operational performance, as we increased our bitcoin production by 39 percent over the second quarter's production due to our focus on miner uptime, coupled with the reliability of controlling our own power afforded by our vertical integration," said Dave Anderson, chief executive officer of Greenidge. "The prolonged crypto winter that has impacted our industry has caused us to reassess our expansion plans while we work to improve our liquidity."
Greenidge's revenue for the third quarter was $29.4 million, down 18 percent compared to the prior year period. Cryptocurrency data center revenue for the third quarter was $18.3 million, down 41 percent compared to the prior year period, and power and capacity revenue for the third quarter was $3.6 million, up 17 percent compared to the prior year period. Greenidge's Support.com subsidiary, which was acquired in September 2021, generated approximately $7.5 million in third-quarter revenue, up 391 percent as about half of one month's operations of Support.com was included in Greenidge's third quarter 2021 results.
Greenidge produced approximately 866 bitcoin during the third quarter of 2022, compared to 729 bitcoin in the third quarter of 2021, and had approximately 24,500 miners in service as of Sept. 30. During the month of October, Greenidge produced approximately 269 bitcoin.
Net loss was $23.1 million for the third quarter as compared to $7.9 million in the prior year period. Greenidge's third quarter 2022 results included $0.8 million of losses on sales of assets, $0.2 million of merger and other costs and $0.2 million of expansion costs. Adjusted net loss was $22 million, compared to adjusted net income of $12.2 million in the prior year period.
Greenidge ended the quarter with approximately $39 million of cash, restricted cash and fair market value of cryptocurrency holdings, of which, less than $1 million was cryptocurrency holdings.
Greenidge's mining operations in Dresden are powered by the power plant located at the facility. The plant is periodically offline for scheduled maintenance outages and for unscheduled outages. In the third quarter of 2022, the plant was offline for zero hours, representing an uptime of 100 percent. For the nine months that ended Sept. 30, the plant was offline for six hours. There is additional planned time offline during the remainder of the fourth quarter of 2022 of approximately 13 days to complete the annual maintenance.
Greenidge previously disclosed that it expected to have increased mining capacity by the first quarter of 2023. In an effort to preserve its liquidity, the company is currently reassessing its expansion plans. As previously disclosed, during the second quarter of 2022, the price of bitcoin decreased approximately 57 percent and the cost of natural gas increased approximately 53 percent. Given the lack of meaningful improvement in the price of bitcoin and the cost of natural gas coupled with Greenidge's existing financial liabilities, there is uncertainty regarding Greenidge's financial condition and substantial doubt about its ability to continue as a going concern for a reasonable period of time.
During the third quarter of 2022, Greenidge continued to reduce its inventory of older, less efficient mining equipment in order to free up mining capacity for newer, more efficient miners in its order book. Greenidge expects this trend to continue through the end of 2022, and may also consider other asset sales to further enhance its liquidity position.
The stock GREE was trading at $0.57 per share, Tuesday, Nov. 22.