Shares of Marathon Digital (MARA), a prominent bitcoin mining company, experienced a precipitous decline of up to 8% in after-hours trading on Thursday, subsequent to the firm’s second-quarter revenue failing to meet Wall Street expectations. The stock has since recuperated some of its initial losses.

According to FactSet data, Marathon disclosed a revenue of $145.1 million for the second quarter, falling short of the anticipated $157.9 million. This revenue dip is attributed to several operational impediments that hampered bitcoin mining operations, coupled with the adverse impacts of a recent halving event on the mining sector, as articulated in the company’s earnings report.

“Throughout the second quarter of 2024, our bitcoin production was adversely affected by unforeseen equipment malfunctions and transmission line maintenance at the Ellendale site, managed by Applied Digital. Additionally, the increased global hash rate and the April halving event further compounded these challenges,” stated Fred Thiel, the CEO, in an official release.

Read more: Diversified Revenue: Marathon Digital Ventures into Kaspa Mining

Despite these setbacks, Marathon reported that the aforementioned issues have been resolved, and the company achieved a record-breaking mining capacity of 31.5 exahash per second (EH/s) during the second quarter.

Marathon also revealed a stark swing in its second-quarter adjusted EBITDA, reporting a loss of $85.1 million, a significant decline from a profit of $35.8 million in the previous year. This downturn is primarily attributed to unfavorable fair value adjustments of its digital assets and a reduction in bitcoin mined during the quarter.

Nevertheless, Marathon remains optimistic, projecting a hashrate target of 50 EH/s by the end of the year, with plans for further expansion in the following year.

To sustain its operations, Marathon liquidated 51% of the bitcoin mined in the second quarter. However, the company recently announced the acquisition of $100 million worth of bitcoin on the open market and a strategic pivot to fully retain all bitcoin holdings on its balance sheet. Currently, Marathon’s balance sheet boasts over 20,000 BTC.

“During the quarter, we restructured our internal operations to better align with growth opportunities, enhance our strategic focus, bolster accountability, and expedite our responsiveness and agility as we scale,” Thiel added.

This article underscores the inherent volatility and operational challenges within the bitcoin mining industry, while also highlighting Marathon Digital’s strategic adjustments and future growth aspirations.