Bitcoin Mining Titan Bitmain Generated $1.1 Billion Profits in Q1 2018 Prior to IPO Launch
Bitcoin Mining Company Bitmain Earned $1.1 Billion in Profits in Q1 2018
Bitmain, the world’s largest cryptocurrency mining company, just had its first quarter earnings leaked online. According to the report, the Chinese mining hardware and pool company earned $1.1 billion in net profit in just the first quarter of 2018.
The company expects to earn $2 to $3 billion in total profit over the course of 2018, according to conservative estimates.
Perhaps the most exciting part of the report, however, was that Bitmain appears to be moving forward with plans to conduct an IPO. As revealed earlier this year, Bitmain plans to conduct their initial public offering in Hong Kong “or in an overseas market with U.S. dollar-denominated shares,” according to Fortune.com. That IPO, if the email is to be believed, is going to be filed “very soon”.
The IPO would give early Bitmain investors, including Sequoia Capital and IDG Capital, an opportunity to cash out.
Fortune.com cited a report from Term Sheet, which “obtained an email from a source close to the company.” This email included detailed financial information about the company in the leadup to its ICO. Other information revealed in the report included:
- Bitmain is raising further cash in addition to a $400 million round reported in early June 2018
- This new funding round is expected to value Bitmain at approximately $14 billion, implying a 10 to 11x earnings multiple
- This valuation is a 16.6% increase from Bitmain’s last valuation of $12 billion, which was reported in June 2018 as the company was considering an IPO
- The email cites a KPMG audit of Bitmain and reports that Bitmain produced $1.2 billion in net profit and an approximately 50% net margin in 2017
- Bitmain reportedly brought in $1.1 billion in Q1 2018 alone, with profit estimates for the full year expected to be $2 billion to $3 billion
- The email concludes by stating that Bitmain is planning “to file for an IPO very soon.”
Bitmain, led by 32-year old co-founder Jihan Wu, has grown to become the world’s largest cryptocurrency mining company since being founded in 2013. In addition to selling more crypto mining hardware than any other company in the world, Bitmain operates Antminer, Antpool, and Hashnest. The Beijing-based company has offices in Shenzhen, Shanghai, Chengdu, Hong Kong, and Fuzhou, along with international offices in the United States, Israel, the Netherlands, and Switzerland.
Over the course of 2017, it’s estimated that Bitmain generated $3 to 4 billion in profit. It seems likely that Bitmain will equal or surpass that amount in 2018, with conservative estimates preparing for $2 to $3 billion in profit.
Ultimately, Bitmain dominates the crypto hardware and mining space. An IPO would solidify the company’s position at the top of the food chain – and there are no signs Bitmain is slowing down anytime soon.
Bitmain net profit in Q1 2018: $1.1B
Total value of all BTC mined in Q1 2018: ~$1.3B 😮
Of course, Bitmain makes other miners like LTC miners, but still! This is zero sum. Mining rewards are split between miners and manufacturers. 🤔https://t.co/1gsTChyl6b
— Charlie Lee [LTC⚡] (@SatoshiLite) July 30, 2018