Bitcoin Mining Operations Leveraging Energy Savings to Drive Profits



KEY POINTS

THE COMPANY

CleanSpark, Inc. (CLSK) is a software and services company providing advanced energy software and control technology that enables a plug-and-play and end-to-end enterprise energy solution in microgrid and distributed energy resource (DER) settings as well as hardware systems, specifically switch gear and energy storage solutions. The company also engages in bitcoin mining.

Central to the energy software and control technology business is an integrated software suite comprised of mPulse and mVSO, with the core function of enabling a user to accurately model and intelligently manage a complex microgrid. CleanSpark’s software solutions can be widely implemented across commercial, industrial, military, and municipal organizations. In terms of revenue breakdown, although the hardware business accounts for the bulk (~48% as of 1Q21) of the company’s revenue, it carries low margins (~10%) while the software solutions and the newly launched bitcoin mining operation carry exceptional margins of ~80%. It is expected that in 2Q21 and in future periods, the higher margin revenues will begin to exceed 50-80% of total revenue.

Bitcoin mining is central to the bitcoin ecosystem. It is a process that verifies transactions and provides security to the bitcoin blockchain, and it is how new bitcoins enter circulation. CleanSpark entered into this rapidly growing market through its acquisition of ATL Data Centers in December 2020.

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