HIVE Digital: Underwhelming Q4, Continue To Avoid

Summary HIVE’s Q4 results reinforce my view that Bitcoin mining is structurally unprofitable, with declining revenues despite higher Bitcoin prices and hashrate. The company’s relentless capacity expansion is necessary to keep pace with industry difficulty, but it results in a never-ending cycle of capital investment and little financial return. HIVE’s HPC/AI business remains insignificant compared to industry leaders, offering no meaningful diversification or growth opportunity. I continue to recommend avoiding HIVE for long-term investors, as the economics of Bitcoin mining remain unattractive, except during rare Bitcoin price surges. It’s been a few months since I last wrote about HIVE Digital ( HIVE ) . In my last article, I was cautious on HIVE, as the company’s perpetual share dilution and volatile stock price make it unattractive for long-term investors. Since my article, HIVE’s shares have done well, returning 10.8% (Figure 1). Figure 1 – HIVE has risen 11% since March (Seeking Alpha) However, with the company releasing its fiscal fourth quarter results, I thought it would be timely to catch up with the company and see if HIVE’s financial performance has improved or if there are any interesting corporate developments worth commenting on. Overall, HIVE’s fourth quarter financial performance reiterates my thesis about the poor economics of Bitcoin mining. Although Bitcoin prices rose significantly YoY and HIVE’s hashrate rose 40% YoY from 4.5 EH/s to 6.3 EH/s, HIVE saw a YoY revenue decline and a big net loss as Bitcoin prices dipped in the quarter. HIVE remains an avoid for me. Brief Company Overview For those not familiar, HIVE’s core business remains its Bitcoin mining operations, which currently operate at 6 Exahash/s (“EH/s”), with plans to expand capacity to quadruple capacity to 25.5 EH/s by September 2025 (Figure 2). Figure 2 – HIVE’s footprint ( Investor Presentation ) HIVE also has a nascent High-Performance Compute/Artificial Intelligence (“HPC/AI”) business unit that rents out its graphical processing units (“GPUs”) to businesses and researchers seeking access to the latest NVIDIA GPUs for AI workloads. Q4/2025 Was Underwhelming As mentioned above, HIVE’s recently reported its fiscal fourth quarter results. Revenue was $31.2 million, a 15.4% YoY decline, despite Bitcoin prices rising significantly YoY (Figure 3). Figure 3 – HIVE Q4 financial summary ( Company Reports ) The main culprit is HIVE’s Bitcoin production, which plunged to just 303 coins mined in the three months ended March 31, 2025. Bitcoin Mining Is A Mug’s Game As I have written numerous times, Bitcoin mining is a mug’s game because miners need to constantly upgrade their kit, increasing difficulty for the industry and reducing production for everyone (Figure 4). Figure 4 – Bitcoin mining difficulty is ever increasing (blockchain.com) So, even though HIVE’s hashrate has increased “from approximately 4.5 EH/s on March 31, 2024 to 6.3 EH/s on March 31, 2025”, the number of coins mined got sliced in half for HIVE, leading to lower YoY revenues. HIVE Continues To Grow Capacity The problem is that HIVE can’t stop growing capacity, since everyone else in the industry is constantly buying more servers and data centers to mine Bitcoin (see the rising difficulty above). For HIVE, there is some positive news on the growth front. As per the quarterly press release , “HIVE commissioned the first 100 MW at Yguazú two weeks ahead of its projected schedule,” doubling the company’s hashrate to 11.5 EH/s, which is sufficient to mine 5.5 Bitcoins per day at current difficulty. This growth is part of the company’s plans to quadruple its hashrate to over 25 EH/s by December 2025 (author’s note, the figure below from the latest corporate presentation shows plans for 25.5 EH/s by September, so management’s latest update implies a slight delay to the growth plans) (Figure 5). Figure 5 – HIVE plans to quadruple hashrate to 25.5 EH/s by year-end ( Investor Presentation ) However, given the arms race to deploy more servers to mine Bitcoin, I fear investors will see much less growth in production than expected. Just counting the large publicly traded Bitcoin miners, we see growth plans to increase hashrate by ~50% by September (Figure 6). Figure 6 – Everyone else is also planning growth in hashrate ( Investor Presentation ) So while HIVE may enjoy a temporary boost to production, as competitor servers are brought online, HIVE’s Bitcoin production will once again trend lower, unless it expands capacity again. This is a never-ending cycle of capital investment with little financial return. What Does HIVE Have To Show For Its Capital? Since 2016, HIVE has spent over $700 million in capital expenditures and acquisitions (Figure 7), including nearly $200 million in the last twelve months (Figure 8). Figure 7 – HIVE has spent over $700 million in capex since 2016 (Seeking Alpha) Figure 8 – HIVE invested $200 million in last twelve months ( Company Reports ) However, if we look at the balance sheet, HIVE only has $202 million in net PP&E and 2,201 Bitcoins in its HODL account, worth $181 million, to show for its efforts (Figures 9 and 10). Figure 9 – HIVE PP&E ( Company Reports ) Figure 10 – HIVE HODL account for Bitcoin ( Company Reports ) Simply put, Bitcoin mining does not appear to be a positive NPV activity that creates economic value. HPC Remains A Rounding Error As I have written previously, HIVE’s HPC/AI business continues to struggle to gain traction. Although the company claims to have tripled revenues to $10.1 million in F2025 (Figure 11), HIVE’s tier-3 data centers simply lack the scale and sophistication to compete with the leading AI companies like CoreWeave Coreweave ( CRWV ). Figure 11 – HIVE quarterly revenues breakdown ( Company Reports ) As a comparison, CoreWeave saw revenues increase 420% YoY to $982 million in the most recent quarter (Figure 12)! Figure 12 – CRWV saw revenues explode to nearly $1 billion in latest quarter ( Investor Presentation ) Frankly (pun intended), it is embarrassing for HIVE to even mention HPC/AI as a separate business unit, given its lack of scale. Risks To Being Cautious In my opinion, the only upside to HIVE is the hope for a surge in Bitcoin prices. If Bitcoin prices were to rise materially in a short period of time, Bitcoin miners may be able to enjoy bonanza profits, like they did in 2021/2022, when the price of cryptocurrencies rose much faster than the difficulty of mining them, leading to positive profitability (Figure 13). Figure 13 – HIVE was only profitable briefly in 2021/2022 (Seeking Alpha) Conclusion HIVE’s recently reported Q4/2025 earnings do not change my mind on the poor economics of the Bitcoin mining business. Simply put, Bitcoin mining is a mug’s game where every player is on a treadmill to increase capacity, driving up overall industry difficulty and reducing Bitcoin production. Except for brief stretches when Bitcoin prices rise faster than difficulty, Bitcoin mining is a net negative NPV activity. I continue to advise long-term investors to avoid HIVE and its peers.

Source: Seeking Alpha