0001213900-25-110383
SEC filingBit Digital reported a net income of $146.7 million in Q3 2025, driven by $168.0 million in gains on digital assets, despite a 26.7% decline in mining revenue as the company shifts toward an ETH-focused strategy.
Bit Digital's third quarter of 2025 marked a dramatic turnaround from the prior year, with net income of $146.7 million versus a net loss of $38.8 million in Q3 2024. The primary driver was a $168.0 million gain on digital assets (primarily unrealized), compared to a $21.9 million loss in the year-ago period, reflecting the sharp appreciation in ETH and BTC prices. Total revenue rose 33.4% to $30.5 million, led by cloud services (+48.4% to $18.0 million) and ETH staking (+541.8% to $2.9 million). Digital asset mining revenue declined 26.7% to $7.4 million as BTC production fell 60.8% to 64.9 bitcoins, though higher average BTC prices partially offset the volume drop. Colocation services, a new segment from the October 2024 Enovum acquisition, contributed $1.7 million.
Gross profit (defined as revenue minus cost of revenue, excluding depreciation) improved to $18.3 million (60.2% margin) from $7.4 million (32.3% margin), reflecting a favorable mix shift toward higher-margin cloud services and staking. Operating income of $141.8 million included the large digital asset gains, while adjusted EBITDA (a non-GAAP measure) reached $166.8 million. Basic EPS was $0.48, compared to a loss of $0.26 per share in Q3 2024.
Total assets more than doubled to $1.13 billion as of September 30, 2025, from $538.2 million at December 31, 2024. Cash and cash equivalents rose to $179.1 million from $95.2 million, reflecting significant equity and debt raises. Digital assets (primarily BTC and ETH) surged to $423.7 million from $161.4 million, driven by ETH purchases and fair value gains. The company held 102,024 ETH and 6.1 BTC as of quarter-end.
Liabilities increased modestly to $87.5 million from $74.8 million, with operating lease liabilities rising to $41.9 million (due to new data center leases). Deferred revenue fell from $30.8 million to $7.8 million as prepayments from cloud customers were recognized. Equity ballooned to $1.05 billion, including $139.4 million in noncontrolling interests from the WhiteFiber IPO. Subsequent to the quarter, in October 2025, Bit Digital issued $150 million of 4.00% convertible senior notes due 2030 and renewed its at-the-market equity program with capacity up to $2.5 billion.
Cash used in operations for the nine months ended September 30, 2025, was $204.9 million, driven by increased digital asset holdings and working capital changes. Net income of $103.9 million was adjusted for non-cash gains on digital assets ($146.0 million), digital assets mined ($21.8 million), and share-based compensation ($22.4 million). Cash used in investing was $164.1 million, primarily for PP&E (GPU servers and data centers). Financing activities provided $452.7 million from stock offerings ($162.6 million public offering, $62.8 million registered direct, $58.5 million ATM) and $147.4 million from the WhiteFiber IPO. Free cash flow (operating cash flow minus capex) was negative $368.9 million on a nine-month basis, but the capital raises have left the company with ample liquidity.
Management reiterated its strategic transition to become a pure-play ETH staking and treasury company. It intends to convert BTC holdings into ETH over time and is pursuing a sale or wind-down of its bitcoin mining operations. The HPC business (cloud services and colocation) is now housed under WhiteFiber, which completed its IPO in August 2025, with Bit Digital retaining ~70.7% ownership. Cloud services revenue is expected to grow as new GPU contracts with Boosteroid and DNA Fund ramp up, though the company noted a $2.0 million service credit accrued in Q3. Colocation revenue will benefit from the MTL-3 facility, which began billing Cerebras at CAD 1.4 million monthly starting November 2025. No quantitative forward guidance was provided, but risks include tariff impacts on data center construction, ETH price volatility, and the successful execution of the WhiteFiber separation.
Segment-wise, cloud services generated segment gross profit of $11.7 million (65.0% margin), digital asset mining $2.4 million (32.1%), ETH staking $2.8 million (96.1%), and colocation $1.0 million (60.1%). The digital asset mining margin improved significantly due to lower electricity costs from reduced miner count and favorable power contracts.
Share-based compensation totaled $16.3 million in Q3, including $3.9 million from WhiteFiber's 2025 Plan grants. The company recorded a $1.8 million impairment on digital intangible assets (LsETH) after receiving 4,719 LsETH in July 2025.
The company's effective tax rate was 0.5% for the quarter, as most income was generated in jurisdictions with low or no corporate tax (Cayman Islands, Iceland). The One Big Beautiful Bill Act permanently restored 100% bonus depreciation, reducing U.S. cash taxes.
Subsequent to quarter-end, Bit Digital finalized a $150 million convertible note offering and a $2.5 billion ATM program, underscoring its aggressive capital-raising to fund ETH accumulation and data center development.