10-Q: American Bitcoin Corp. Q3 Revenue Soars Amid Strategic Expansion
Quarterly Report
American Bitcoin Corp. reports a significant revenue increase in Q3 2025, driven by enhanced mining efficiency and strategic miner acquisitions, despite a nine-month net loss.
Summary
- American Bitcoin Corp. (ABTC) reported Q3 2025 revenue of $64.2 million, a substantial increase from $11.6 million in Q3 2024.
- Net income for Q3 2025 was $3.475 million, a turnaround from a net loss of $0.576 million in Q3 2024.
- Adjusted EBITDA for Q3 2025 was $27.653 million, compared to a negative Adjusted EBITDA of $4.318 million in Q3 2024.
- For the nine months ended September 30, 2025, revenue increased to $106.8 million from $55.9 million in the prior year period.
- The company recorded a net loss of $93.717 million for the nine months ended September 30, 2025, compared to a net income of $168.773 million for the same period in 2024.
- Adjusted EBITDA for the nine months ended September 30, 2025, was a negative $79.695 million, down from a positive $202.876 million in the prior year period.
- ABTC accumulated approximately 4,090 Bitcoin in reserve as of November 13, 2025, including Bitcoin held in custody or pledged for miner purchases.
- The company owns approximately 77,944 Bitcoin miners with a cumulative hashrate of 25.0 EH/s and a weighted average fleet efficiency of 16.3 J/TH.
- A merger with Gryphon Digital Mining, Inc. was completed on September 3, 2025, with Gryphon being renamed American Bitcoin Corp. and Historical ABTC identified as the accounting acquirer.
- ABTC entered into an On-Rack Sales and Purchase Agreement (ABTC Bitmain Purchase Agreement) to acquire up to approximately 17,280 Bitmain U3S21EXPH Bitcoin miners for up to $320.0 million, largely paid through Bitcoin pledges.
Sentiment
Score: 7
Explanation: The sentiment is moderately positive. While the nine-month period shows a significant net loss and negative Adjusted EBITDA, these are largely attributable to the complex carve-out and merger transactions, and the market-driven loss on digital assets. The strong Q3 operational performance, substantial revenue growth, successful capital raises, and aggressive expansion of the mining fleet and Bitcoin reserve indicate a company executing a clear growth strategy. The strategic investments and operational improvements outweigh the historical accounting impacts for the full nine-month period, suggesting a positive trajectory.
Positives
- Q3 2025 revenue surged to $64.2 million, a 453% increase from $11.6 million in Q3 2024, driven by increased mining efficiencies and new miner deployments.
- Achieved positive net income of $3.475 million in Q3 2025, reversing a loss of $0.576 million in Q3 2024.
- Reported positive Adjusted EBITDA of $27.653 million in Q3 2025, a significant improvement from a negative $4.318 million in Q3 2024.
- Successfully completed a fleet upgrade, installing higher-efficiency Antminer S21+ miners and targeted infrastructure upgrades, improving Bitcoin mining operations.
- Acquired approximately 17,280 Bitmain Miners, adding 14.86 EH/s to the mining fleet, significantly expanding operational capacity.
- Accumulated 3,418 Bitcoin as a standalone entity as of September 30, 2025, and further expanded its strategic Bitcoin reserve by purchasing 306 Bitcoin for $35.3 million between October 1 and November 13, 2025.
- Successfully launched a $2.1 billion At-The-Market (ATM) Offering Program, raising $90.0 million in gross proceeds by September 30, 2025, and an additional $44.1 million by November 13, 2025.
Negatives
- Reported a net loss of $93.717 million for the nine months ended September 30, 2025, a significant decline from a net income of $168.773 million in the prior year period.
- Adjusted EBITDA for the nine months ended September 30, 2025, was a negative $79.695 million, compared to a positive $202.876 million in the prior year period.
- Experienced a loss on digital assets of $5.5 million in Q3 2025, primarily due to the Bitcoin price of $114,068 as of September 30, 2025, being lower than the average cost basis of Bitcoin accumulated by the Company in the quarter ($116,808).
- Nine-month loss on digital assets was $114.8 million, largely due to the decrease in Bitcoin held by the company after the carve-out and the Bitcoin price decrease from December 31, 2024, to March 31, 2025.
- Cost of revenue increased by $17.2 million in Q3 2025 and $15.7 million for the nine months, driven by increased miner consumption and a higher power cost per megawatt hour ($42.41 in Q3 2025 vs. $28.40 in Q3 2024).
- Other expense for Q3 2025 was $2.0 million, a decrease of $11.0 million from other income in Q3 2024, primarily due to a decrease in gain on debt extinguishment and derivatives.
- The company is involved in ongoing legal proceedings, including a review by the SBA regarding a forgiven PPP Loan and a wrongful termination lawsuit by a former CEO.
Risks
- Market price risk of Bitcoin: The company's business is heavily dependent on the volatile price of Bitcoin, which can significantly impact results of operations and liquidity.
- Bitcoin network difficulty and hashrate: Increased competition in Bitcoin mining (higher network hashrate and difficulty) can reduce mining proceeds and profitability, requiring equipment upgrades to remain competitive.
- Power costs: Power costs are a significant and volatile component of mining expenses, sensitive to factors outside the company's control, and can impact profitability.
- Custodian risk: Reliance on third-party custodians (Anchorage, Bitgo, Coinbase) for Bitcoin storage exposes the company to potential loss, theft, or misappropriation due to operational failures, cybersecurity breaches, or financial difficulties of custodians.
- Credit risk: Pledging Bitcoin as collateral in transactions with counterparties carries credit risk, with potential for material loss if a counterparty defaults.
- Tariff risk: Changes in government policies, incentives, or tariffs could adversely impact the company's ability to import equipment cost-effectively.
- Legal and regulatory matters: The company is subject to various claims, lawsuits, and governmental proceedings, including a review of its PPP Loan eligibility by the SBA and a wrongful termination lawsuit by a former CEO, which could result in significant damages or adverse effects on the business.
Future Outlook
The company aims to continue its strategy of efficient Bitcoin mining and disciplined Bitcoin reserve expansion. It anticipates that cash flows from capital raised and its strategic Bitcoin reserve will meet short-term and long-term cash requirements. The next Bitcoin halving event is expected in 2028. The company will continue to evaluate the overall impact of the One Big Beautiful Bill Act (OBBBA) on its financial position.
Management Comments
- Management believes the assumptions underlying the Company's Unaudited Condensed and Combined Financial Statements, including the expense methodology and resulting allocation, are reasonable for all periods presented.
- Management, with the assistance of outside counsel, may from time to time adjust accruals for legal and regulatory proceedings according to new developments, court rulings, or changes in strategy.
Industry Context
The Bitcoin mining industry is characterized by significant volatility in Bitcoin prices, increasing network difficulty, and fluctuating power costs. American Bitcoin Corp.'s strategic focus on accumulating Bitcoin, expanding its mining fleet with higher-efficiency machines, and securing colocation services through its parent company positions it to navigate these dynamics. The recent halving event in April 2024 impacts block rewards, necessitating operational efficiency and scale for profitability. The company's substantial capital raises and miner acquisitions reflect a growth-oriented approach in a competitive and capital-intensive sector.
Comparison to Industry Standards
- NA
Management Changes
| Role | Previous Person | New Person | Effective Date | Reason |
|---|---|---|---|---|
| Chief Executive Officer and President of Gryphon | Mr. Robby Chang | NA | 2024-09-17 | Terminated for cause by Gryphon's Board of Directors. |
Corporate Governance
| Change Type | Description | Effective Date | Impact Assessment |
|---|---|---|---|
| Board Committee Formation | Gryphon's Board of Directors created a special committee to oversee Gryphon's handling of the claim made by Mr. Chang. | 2024-10-22 | Enhances oversight and dedicated focus on managing significant legal proceedings. |
Legal Proceedings
- SBA Review of PPP Loan: The SBA is reviewing its prior determination of forgiveness for Gryphon's $2.2 million PPP Loan, considering a full denial based on purported ineligibility. Gryphon has responded and is cooperating with a civil investigative demand from the Department of Justice.
- Former CEO Litigation: Mr. Robby Chang filed a lawsuit against Gryphon and Ivy Crypto, Inc. in the Ontario Superior Court of Justice in Canada, alleging wrongful termination. Mediation was unsuccessful, and the litigation remains unresolved.
Related Party Transactions
- Master Colocation Services Agreement (MCSA) with Parent (Hut 8 Corp.): Parent provides colocation and hosting services for ABTC's Bitcoin miners at Parent-owned or leased facilities. Fees and expenses billed were $25.6 million for Q3 2025 and $40.0 million for the nine months ended September 30, 2025.
- Master Management Services Agreement (MMSA) with Parent: Parent provides management, oversight, strategy, compliance, operational, and other services for ABTC's Bitcoin mining operations. Fees and expenses billed were $2.7 million for Q3 2025 and $4.2 million for the nine months ended September 30, 2025.
- Shared Services Agreement with Parent: Parent provides back-office support services (accounting, HR, IT, legal, etc.) to ABTC. Fees and expenses billed were $6.8 million for Q3 2025 and $8.7 million for the nine months ended September 30, 2025.
- Put Option Agreement with Parent: Parent assigned its option to purchase up to approximately 17,280 Bitmain Miners to ABTC on August 5, 2025. ABTC subsequently entered into the ABTC Bitmain Purchase Agreement.
- As of September 30, 2025, ABTC owed Parent $103.8 million related to these agreements.
Stakeholder Impact
- Shareholders: The significant capital raises (private placement and ATM offering) dilute existing shareholders but provide capital for growth. The Q3 operational improvements could positively impact investor confidence, while the nine-month net loss and ongoing legal risks could be a concern.
- Employees: The company's strategic expansion and fleet upgrades suggest job stability and potential growth opportunities within the operational teams. The former CEO litigation could create uncertainty at the executive level.
- Customers (Mining Pool Operators): Increased hashrate and efficiency mean ABTC can contribute more computing power, potentially strengthening relationships with mining pool operators.
- Suppliers (Bitmain, Parent): The ABTC Bitmain Purchase Agreement and ongoing service agreements with Parent ensure continued business for these key suppliers.
- Creditors: The company's ability to raise substantial capital and accumulate Bitcoin reserves enhances its financial stability, which is positive for creditors, though the pledged Bitcoin for miner purchases represents a form of collateralized debt.
Next Steps
- Continue to build its strategic Bitcoin reserve through Bitcoin mining and at-market purchases.
- Further evaluate the overall impact of the One Big Beautiful Bill Act (OBBBA) on its financial position.
- Cooperate with any further inquiry from the SBA regarding the PPP Loan.
- Vigorously defend the wrongful termination lawsuit filed by the former CEO.
Key Dates
| Date | Description |
|---|---|
| 2020-04-21 | Gryphon obtained a $2.2 million PPP Loan. |
| 2021-09-03 | Gryphon's PPP Loan was forgiven in full by the Small Business Administration (SBA). |
| 2023-12-31 | Balance sheet date for comparison of digital assets and other metrics. |
| 2024-01-25 | Date of letter from SBA to Gryphon indicating review of PPP Loan forgiveness for potential reversal. |
| 2024-02-05 | Gryphon received the SBA letter dated January 25, 2024. |
| 2024-02-06 | Gryphon responded to the SBA regarding PPP Loan eligibility. |
| 2024-03-04 | Company announced the closure of the Drumheller, Alberta mining site. |
| 2024-03-31 | Balance sheet date for comparison of digital assets and other metrics. |
| 2024-04-01 | Company began operating as a standalone entity following the effectiveness of the Transactions. |
| 2024-04 | Last Bitcoin halving event occurred. |
| 2024-05-05 | Mediation held for the former CEO's wrongful termination lawsuit, which was unsuccessful. |
| 2024-06-30 | Balance sheet date for comparison of digital assets and other metrics. |
| 2024-09-17 | Mr. Robby Chang was terminated as CEO and President of Gryphon. |
| 2024-09-30 | End of the quarterly period for financial reporting. |
| 2024-10-21 | Gryphon received notice of a complaint filed by Mr. Chang in the Ontario Superior Court of Justice. |
| 2024-10-22 | Gryphon's Board of Directors created a special committee to oversee the handling of Mr. Chang's claim. |
| 2024-11 | Parent entered into a purchase agreement with Bitmain Technologies Delaware Limited for approximately 30,000 Bitmain Antminer S21+ ASIC miners. |
| 2024-12 | Parent pledged 968 Bitcoin to Bitmain in connection with the Parent Bitmain Purchase Agreement. |
| 2024-12-15 | Effective date for ASU 2025-06 (Intangibles-Goodwill and Other-Internal-Use Software) for interim and annual periods beginning after this date. |
| 2024-12-31 | End of the fiscal year for audited financial statements and balance sheet date. |
| 2025-01 | FASB issued Update ASU 2025-01 clarifying the effective date for ASU 2024-03. |
| 2025-01-19 | Changes to bonus depreciation for certain assets placed in service after this date due to the One Big Beautiful Bill Act (OBBBA). |
| 2025-03-31 | Hut 8 Corp. (Parent), American Data Centers Inc. (ADC), and ADC stockholders entered into a Contribution and Stock Purchase Agreement (the Transactions). ADC was renamed Historical ABTC. |
| 2025-04-01 | Effectiveness date of the Transactions; Historical ABTC began operating as a standalone entity. |
| 2025-04-04 | Company's planned fleet upgrade was completed. |
| 2025-05-09 | Gryphon Digital Mining, Inc. and Historical ABTC entered into an Agreement and Plan of Merger (the Merger Agreement). |
| 2025-06-27 | Closing of the Private Placement of Class A common stock, raising $220.1 million gross proceeds. |
| 2025-07-04 | The One Big Beautiful Bill Act (OBBBA) was enacted into law in the United States. |
| 2025-07-31 | Gryphon's definitive proxy statement/prospectus filed with the SEC. |
| 2025-08-05 | Parent assigned its option to purchase Bitmain Miners to the Company, which then exercised the option and entered into the ABTC Bitmain Purchase Agreement. |
| 2025-09-01 | Company purchased remaining 981 Bitmain Miners for $18.9 million. |
| 2025-09-02 | Gryphon's Current Report on Form 8-K filed with the SEC. |
| 2025-09-03 | Consummation of the Mergers (Business Combination) between Gryphon and Historical ABTC; Gryphon renamed American Bitcoin Corp. Company entered into a Controlled Equity Offering Sales Agreement for a $2.1 billion at-the-market equity program. |
| 2025-09-30 | End of the quarterly period for financial reporting. |
| 2025-10 | Company pledged an additional 391 Bitcoin, and Bitmain refunded $46.0 million comprising Parent's deposit and certain expenses. |
| 2025-11-05 | Deadline for the Company to exercise its option to replace $46.0 million cash paid with a Bitcoin pledge. |
| 2025-11-13 | Date as of which ABTC had accumulated approximately 4,090 Bitcoin and issued additional Class A shares under the 2025 ATM. |
| 2025-11-14 | Date of signing of the Quarterly Report on Form 10-Q. |
| 2025-12-31 | Amended redemption period for Parent's pledged Bitcoin to Bitmain ends during this quarter. |
| 2026-12-15 | Effective date for ASU 2024-03 (Income Statement Reporting Comprehensive Income-Expense Disaggregation Disclosures) for the first annual reporting period beginning after this date. |
| 2027-06-29 | Expiry date for Akerna Underwriter Warrants. |
| 2027-07-05 | Expiry date for Akerna Common Warrants. |
| 2027-12-15 | Effective date for ASU 2025-06 (Intangibles-Goodwill and Other-Internal-Use Software) for interim periods within annual periods beginning after this date. |
| 2028 | Next Bitcoin halving event is expected to occur. |
| 2035-01 | Expiry date for Gryphon Warrants. |
Recommendation
holdAmerican Bitcoin Corp. is undergoing a significant transformation, marked by a strategic carve-out, a major merger, and aggressive expansion of its Bitcoin mining operations. While the nine-month financial results show a substantial net loss and negative Adjusted EBITDA, these figures are heavily influenced by the accounting impacts of the corporate restructuring and market-driven digital asset revaluations. The strong Q3 2025 performance, with a significant revenue surge and positive net income/Adjusted EBITDA, indicates operational improvements and successful integration post-merger. The company's ability to raise substantial capital through private placement and an ATM offering, coupled with large-scale miner acquisitions, demonstrates a clear commitment to growth and Bitcoin accumulation. However, the inherent volatility of Bitcoin, ongoing legal proceedings, and the capital-intensive nature of the business present considerable risks. A 'hold' recommendation is appropriate for investors to observe the sustained operational improvements, the effective deployment of raised capital, and the resolution of legal and regulatory uncertainties, before committing to a stronger position. The long-term potential in the Bitcoin mining sector, combined with ABTC's strategic moves, warrants continued monitoring.
Keywords
Bitcoin mining, Digital assets, ASIC miners, Cryptocurrency, SEC filing, 10-Q, Financial results, Corporate merger, Capital raise, Hashrate, Blockchain
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