CleanSpark Reports Fiscal Year First Quarter 2025 Results

$162.3M quarterly revenue, up 120% from prior year

$241.7M quarterly net income and basic EPS of $0.85

Marginal cost per coin decreases 6% to ~$34,000 at owned facilities

CleanSpark, Inc. (Nasdaq: CLSK) (the “Company”), America's Bitcoin Miner®, today reported financial results for the quarter ended December 31, 2024.

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“This quarter we saw the impact of continuous improvements across what we believe to be the most important industry metrics: operating hashrate, fleet efficiency, marginal cost to mine, bitcoin treasury, and portfolio uptime,” said CleanSpark CEO Zach Bradford. “We exceeded 2024 guidance and surpassed 40 EH/s in January, while driving fleet efficiency down to 16.15 J/Th,” Bradford said. “CleanSpark delivered $162.3 million in revenue at a marginal cost to mine of approximately $34,000 per bitcoin for the quarter.”

“We are well on our way towards achieving 50 EH/s in the first half of 2025. We expect this growth will happen in the communities in which we already operate through expansion and greenfield projects in Wyoming, Tennessee, and Georgia. Our regional expansion strategy was developed and refined in Georgia, and we are now replicating it nationally,” said Bradford.

“Our capital strategy continues to evolve, as demonstrated by the closing of our $650 million convertible bond with industry leading terms, and the conclusion of our at-the-market offering program,” said CleanSpark CFO Gary Vecchiarelli. “We overcame virtually all of the halving impact on the bitcoin block subsidy while growing our current bitcoin treasury to over 10,500 – 100% of which was entirely self-mined by CleanSpark and exclusively in the USA. We have one of the cleanest balance sheets in the industry and look forward to utilizing it through our institutional grade bitcoin treasury team and strategy.”

“CleanSpark's financial strength continued to grow in fiscal Q1, with 57% gross margin, nearly $2.8 billion in assets, and $1.2 billion in total liquidity. We continue to invest in ourselves because why buy bitcoin at current spot prices when we can mine it for $34,000?” Vecchiarelli concluded.

Financial Highlights: First Quarter Fiscal Year 2025 Financial Results for the Three Months Ended December 31, 2024

— Quarterly revenues were $162.3 million, an increase of $88.5 million, or 120%, from $73.8 million for the same prior fiscal quarter.

— Net income for the three months ended December 31, 2024, was $246.8 million or $0.85 per basic share, compared to $25.9 million or $0.14 per basic share, for the same prior year period.

— Adjusted EBITDA(1) increased to $321.6 million from $69.1 million from the same period a year ago.

Balance Sheet Highlights as of December 31, 2024

Assets

— Cash: $276.6 million

— Bitcoin: $929.1 million

— Total Current Assets: $1.2 billion

— Total Mining Assets (including prepaid deposits & deployed miners): $938.8 million

— Total Assets: $2.8 billion

Liabilities and Stockholders' Equity

— Current Liabilities: $96.7 million

— Total long-term debt, net of debt discount & issuance costs: $641.4 million

— Total Liabilities: $757.7 million

— Total Stockholders' Equity: $2.0 billion

The Company had working capital of $1.2 billion as of December 31, 2024, including capacity of $50 million on the bitcoin collateralized line of credit.

1 See “Non-GAAP Measure” and the related reconciliation below

Investor Conference Call and Webcast The Company will hold its fiscal Q1 2025 earnings presentation and business update for investors and analysts today, February 6, 2025, at 1:30 p.m. PT / 4:30 p.m. ET.

Webcast URL: clsk.news/q1fy25

The webcast will be accessible for at least 30 days on the Company's website and a transcript of the call will be available on the Company's website following the call.

About CleanSpark CleanSpark (Nasdaq: CLSK), America's Bitcoin Miner®, is a market-leading, pure play bitcoin miner with a proven track record of success. We own and operate a portfolio of mining facilities across the United States powered by globally competitive energy prices. Sitting at the intersection of Bitcoin, energy, operational excellence and capital stewardship, we optimize our mining facilities to deliver superior returns to our shareholders. Monetizing low-cost, high reliability energy by securing the most important finite, global asset – Bitcoin – positions us to prosper in an ever-changing world. Visit our website atwww.cleanspark.com.

Forward-Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In this press release, forward-looking statements include, but may not be limited to, statements regarding the Company's expectations, beliefs, plans, intentions, and strategies, including its expectations regarding reaching 50 EH/s in the first half of 2025. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “forecasts,” “predicts,” “potential” or “continue” or the negative of these terms or other similar expressions. The forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to: the risk that the electrical power available to our facilities does not increase as expected; the success of our digital currency mining activities; the volatile and unpredictable cycles in the emerging and evolving industries in which we operate; increasing difficulty rates for bitcoin mining; bitcoin halving; new or additional governmental regulation; the anticipated import and delivery dates of new miners; the ability to successfully import and deploy new miners and other mining equipment; the dependency on utility rate structures and government incentive programs; dependency on third-party power providers for expansion efforts; the expectations of future revenue growth may not be realized; and other risks described in the Company's prior press releases and in its filings with the Securities and Exchange Commission (SEC), including under the heading “Risk Factors” in those filings. Forward-looking statements contained herein are made only as to the date of this press release, and we assume no obligation to update or revise any forward-looking statements as a result of any new information, changed circumstances or future events or otherwise, except as required by applicable law.

Non-GAAP Measure The Company presents adjusted EBITDA, which is not a measurement of financial performance under generally accepted accounting principles in the United States(“GAAP”). The Company's non-GAAP “Adjusted EBITDA” excludes (i) impacts of interest, taxes, and depreciation; (ii) the Company's share-based compensation expense, unrealized gains/losses on securities, and, changes in the fair value of contingent consideration with respect to previously completed acquisitions, all of which are non-cash items that the Company believes are not reflective of the Company's general business performance, and for which the accounting requires management judgment, and the resulting expenses could vary significantly in comparison to other companies; (iii) non-cash impairment losses related to long-lived assets (including goodwill); (iv) realized gains and losses on sales of equity securities, the amounts of which are directly related to the unrealized gains and losses that are also excluded; (v) legal fees related to litigation and various transactions, which fees management does not believe are reflective of the Company's ongoing operating activities; (vi) gains and losses on disposal of assets, the majority of which are related to obsolete or unrepairable machines that are no longer deployed; (vii) gains and losses related to discontinued operations that would not be applicable to the Company's future business activities; and (viii) severance expenses. The Company previously excluded non-cash impairment losses related to digital assets and realized gains and losses on sales of bitcoin from its calculation of adjusted EBITDA, but has determined such items are part of the Company's normal ongoing operations and will no longer be excluding them from its calculation of adjusted EBITDA.

Management believes that providing this non-GAAP financial measure that excludes these items allows for meaningful comparisons between the Company's core business operating results and those of other companies, and provides the Company with an important tool for financial and operational decision making and for evaluating its own core business operating results over different periods of time. In addition to management's internal use of non-GAAP adjusted EBITDA, management believes that adjusted EBITDA is also useful to investors and analysts in comparing the Company's performance across reporting periods on a consistent basis. Management believes the foregoing to be the case even though some of the excluded items involve cash outlays and some of them recur on a regular basis (although management does not believe any of such items are normal operating expenses necessary to generate the Company's bitcoin related revenues). For example, the Company expects that share-based compensation expense, which is excluded from adjusted EBITDA, will continue to be a significant recurring expense over the coming years and is an important part of the compensation provided to certain employees, officers, and directors. Additionally, management does not consider any of the excluded items to be expenses necessary to generate the Company's bitcoin related revenue.

The Company's adjusted EBITDA measure may not be directly comparable to similar measures provided by other companies in our industry, as other companies in the Company's industry may calculate non-GAAP financial results differently. The Company's adjusted EBITDA is not a measurement of financial performance under GAAP and should not be considered as an alternative to operating (loss) income or any other measure of performance derived in accordance with GAAP. Although management utilizes internally and presents adjusted EBITDA, the Company only utilizes that measure supplementally and does not consider it to be a substitute for, or superior to, the information provided by GAAP financial results.

Accordingly, adjusted EBITDA is not meant to be considered in isolation of, and should be read in conjunction with, the information contained in the Company's consolidated financial statements, which have been prepared in accordance with GAAP.

CLEANSPARK, INC.CONDENSED CONSOLIDATED BALANCE SHEETS(in thousands, except par value and share amounts) December 31, September30, 2024 2024 (Unaudited)ASSETSCurrent assetsCash and cash equivalents $ 276,599 $ 121,222Restricted cash 3,408 3,056Prepaid expense and other current assets 10,732 7,995Bitcoin (see Note 4) 929,080 431,661Receivable from bitcoin collateral (See Note 9) – 77,827Note receivable from GRIID (see Note 5) – 60,919Derivative investments 4,496 1,832Investment in debt security, AFS, at fair value 950 918Total current assets $ 1,225,265 $ 705,430Property and equipment, net $ 1,256,000 $ 869,693Operating lease right of use assets 4,293 3,263Intangible assets, net 5,945 3,040Deposits on miners and mining equipment 126,867 359,862Other long-term assets 25,671 13,331Goodwill 135,251 8,043Total assets $ 2,779,292 $ 1,962,662LIABILITIES AND STOCKHOLDERS' EQUITYCurrent liabilitiesAccounts payable $ 27,622 $ 82,992Accrued liabilities 51,006 43,874Other current liabilities 5,693 2,240Current portion of loans payable 7,215 58,781Dividends payable 5,141 -Total current liabilities $ 96,677 $ 187,887Long-term liabilitiesLoans payable, net of current portion, debt discount and debt issuance costs 641,433 7,176Deferred income taxes 14,978 5,761Other long-term liabilities 4,618 997Total liabilities $ 757,706 $ 201,821CLEANSPARK, INC.CONDENSED CONSOLIDATED BALANCE SHEETS (Continued)(in thousands, except par value and share amounts)Stockholders' equityPreferred stock; $0.001 par value; 10,000,000 shares authorized; 2 3Series A shares; 2,000,000 authorized; 1,750,000 issued and outstanding(liquidation preference $0.02per share)Series X shares; 0and 1,000,000authorized, issued and outstanding,respectivelyCommon stock; $0.001 par value; 600,000,000 and 300,000,000 shares 293 271authorized; 292,566,230 and 270,897,784 shares issued; 280,806,295 and270,897,784 shares outstanding, respectivelyAdditional paid-in capital 2,403,409 2,239,367Accumulated other comprehensive income 450 418Accumulated deficit (237,568) (479,218)Treasury stock at cost; 11,759,935and 0shares held, respectively (145,000) -Total stockholders' equity 2,021,586 1,760,841Total liabilities and stockholders' equity $ 2,779,292 $ 1,962,662CLEANSPARK, INC.CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME(Unaudited, in thousands, except per share and share amounts) For the three months ended December 31, December 31, 2024 2023Revenues, netBitcoin mining revenue, net $ 162,306 $ 73,786Costs and expensesCost of revenues (exclusive of depreciation and amortization shown below) 70,290 28,896Professional fees 3,885 1,572Payroll expenses 20,869 15,321General and administrative expenses 10,054 5,003(Gain) loss on disposal of assets (791) 677Gain on fair value of bitcoin, (see Note 2 and Note 4) (218,206) (36,041)Depreciation and amortization 66,229 29,847Total costs and expenses $ (47,670) $ 45,275Income from operations 209,976 28,511Other income (expense)Gain on bitcoin collateral 42,493 -Gain (loss) on derivative securities 3,622 (1,243)Interest income 1,476 586Interest expense (1,559) (546)Total other income (expense) $ 46,032 $ (1,203)Income before income tax expense 256,008 27,308Income tax expense 9,217 1,399Net income $ 246,791 $ 25,909Preferred stock dividends 5,141 579Net income attributable to common shareholders $ 241,650 $ 25,330Other comprehensive income 32 29Total comprehensive income attributable to common shareholders $ 241,682 $ 25,359CLEANSPARK, INC.CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME(Continued)(Unaudited, in thousands, except per share and share amounts) For the three months ended December 31, December 31, 2024 2023Income from operations per common share – basic $ 0.85 $ 0.14Weighted average common shares outstanding – basic 284,549,900 178,809,264Income from operations per common share – diluted $ 0.83 $ 0.14Weighted average common shares outstanding – diluted 297,887,140 180,783,535CLEANSPARK, INC.RECONCILIATION OF ADJUSTED EBITDA(Unaudited, in thousands) For the Three Months Ended December 31,($ in thousands) 2024 2023Reconciliation of non-GAAP Adjusted EBITDANet income $ 246,791 $ 25,909Depreciation and amortization 66,229 29,847Share-based compensation expense 3,021 9,953Unrealized loss (gain) of derivative security (3,622) 1,243Interest income (1,476) (586)Interest expense 1,559 546(Gain)/Loss on disposal of assets (791) 677Income tax expense 9,217 1,399Fees related to financing & business development transactions 373 -Litigation & settlement related expenses 348 -Severance and other expenses – 102Non-GAAP adjusted EBITDA $ 321,649 $ 69,090

Investor Relations ContactBarbara Domingo702-989-7693ir@cleanspark.com

Media ContactEleni Stylianou702-989-7694pr@cleanspark.com

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SOURCE CleanSpark, Inc.

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