Riot’s annual report details $500m net loss in 2022
Riot Platform inc., one of North America’s largest bitcoin (BTC) mining companies, released its 2022 annual financial report indicating a net loss of $509.6 million.
According to the annual report released on March 2, the company suffered significant non-cash impairment charges. Non-cash impairment charges are accounting expenses not settled in cash payments. They include amortization, stock depreciation, and goodwill charges.
In the case of Riot, non-cash impairment payments related to goodwill, bitcoin, and miner impairments were the most impactful, grossing about $538.6 million. Additionally, bitcoin depreciation and amortization accounted for $108 million, while non-cash stock-based compensation $24.5 million loss.
The acquisition of the Whinston facility and ESS Metron accounted for a goodwill impairment charge of $335.6 million. ESS Metron is among the market leaders in designing and producing highly engineered electrical products. Its acquisition by Riot complements the acquisition of Whinston’s facility as a critical supplier.
Crypto enthusiasts on Twitter have expressed dissatisfaction with the company’s losses. One user, through their Twitter handle @Cryptadamist, sarcastically explained that it is “awfully impressive” that Riot has decided to file an extension with the SEC citing wrong figures recorded after losing half a billion in 2022.
The user agreed with the Riot shareholders’ refusal to pay their executives about $90 million compensation. He added that they did not deserve it since they could not profit in a “bullish market with a massive subsidy.”
Even in the harsh business climate of 2022, Riot made significant strides in increasing its efficiency in mining bitcoins. These achievements include the production of 5,554 bitcoins, a 46% increase from 2021, total revenue of $259.2 million, and a record hash rate capacity of 9.7 EH/s.
According to Jason Les, the CEO of Riot, 2022 marked a “remarkable year of growth” for the company. He added that Riot achieved an all-time high hash rate, significantly contributing to the high monthly bitcoin production. Les also emphasized that the company’s “industry-leading financial strength” will cushion its aggressive growth plans this year and beyond.