Bitcoin Miner MARA Misses Out on AI Opportunity: Compass Point
Analysts at investment firm Compass Point on Wednesday reiterated their “neutral” rating on Marathon Digital, noting that the company's focus on preparing for the next bitcoin halving is based on untested strategies that may be difficult for investors to immediately evaluate.
On Tuesday, the Miami-based company reported second-quarter revenue of $238 million, up 64% from the same period last year. Net income jumped 505% to a record $808 million, driven in part by a $1.2 billion increase in the fair value of Marathon's bitcoin holdings.
Compass Point analysts note that most Bitcoin miners are focusing on high-performance computing capabilities, viewing the area as a way to diversify revenue as Bitcoin's growing hashrate reduces miners' profitability.
Some miners have used their existing infrastructure to lease capacity to energy-intensive companies. But Marathon’s approach, which involves co-developing AI-powered platforms with a range of energy companies, “increases [operating and R&D costs] while obscuring true profitability,” analysts say.
Marathon shares rose 3% to $17.11 on Wednesday, according to Yahoo Finance . The company's stock has gained 2% year to date, and Compass analysts have a price target of $18.
The company operates 15 mining sites in four countries and holds nearly 50,000 bitcoins, worth $5.9 billion at current prices. Marathon has potential to grow as a “quasi-bitcoin treasury company,” but the lack of HPC could slow growth and put pressure on the stock, analysts say.
In a letter to shareholders, Marathon said it has partnered with TAE Power Solutions and LG-backed PADO AI, both of which specialize in high-efficiency energy systems and can help build AI infrastructure ready for deployment in the field. The company noted that developing corporate partnerships to monetize “unused or stuck electrons” is a top priority, but that revenue diversification through international markets remains a primary goal.
“Everyone else is focused on high-performance computing, and Marathon is kind of in its own world,” Compass analyst Ed Engel told Decrypt . “It’s different from what everyone else is doing.”
Bitcoin's next halving in 2028 will reduce the reward miners receive for verifying transactions from 3.125 BTC to 1.56 BTC per block. The planned event, which took place last year, has become an identity crisis for some Bitcoin miners .
Marathon plans to generate more than 50% of its revenue outside the U.S., and this is expected to include “structured joint ventures with sovereign entities,” Marathon said.
“We believe that large pockets of energy underutilization around the world, particularly in regions with excess renewable or unused capacity, represent a unique opportunity to scale our operations in a capital-efficient manner,” the company added.
While US President Donald Trump has expressed support for expanding Bitcoin mining on American soil, some conservatives abroad are optimistic about the industry.
In March, Marine Le Pen, the leader of France's far-right, backed the idea of using excess electricity generated by nuclear power plants in the region to mine bitcoins, Le Monde reported .
Source: cryptonews.net
