What Bit Digital (BTBT) Said on Its Q3 Earnings Call

Key Points

• Revenue fell sequentially to $27.1 million from $32.1 million, as cloud services declined. Colocation and staking grew, and together with cloud made up about 91% of revenue, reflecting Bit Digital’s shift away from Bitcoin mining.
• Net income attributable to shareholders was $28.5 million, or $0.08 per diluted share, with results including large digital-asset gains and an $80.8 million induced conversion expense. Nine-month operating cash flow of $163 million was materially supported by customer advance payments.
• Management is considering ways to address a roughly 39% share-price discount to disclosed net asset value, including a possible buyback, but no plan is set and shareholder approval and funding decisions are required. The company also said a WhiteFiber credit facility is expected to support repayment of its $100 million bridge loan.

Bit Digital NASDAQ: BTBT reported lower sequential revenue in the third quarter of 2026 as cloud services sales declined, while growth in colocation and Ethereum staking reflected a shift away from Bitcoin mining.

The company also outlined possible ways to address what CEO Sam Tabar described as a roughly 39% discount between Bit Digital’s share price and its disclosed net asset value. Those options include a potential share repurchase program, although Tabar said the company would first need shareholder approval and a funding plan.

Third-quarter revenue was $27.1 million, down from $32.1 million in the second quarter. Revenue for the first nine months of 2026 rose 7% from a year earlier to $87.1 million, CFO Erke Huang said.

Cloud Revenue Falls as Colocation Expands

Cloud services revenue declined to $18.1 million from $23.8 million in the second quarter. The latest figure included $3.4 million in termination fee revenue from an initial customer. Huang said deployments for new customers partially offset the loss of recurring revenue from that customer.

Colocation revenue increased to $5.4 million from $4.7 million in the prior quarter and $1.7 million a year earlier. Huang attributed the growth to the MTL-3 facility and an initial contribution from WhiteFiber’s NC1 site in North Carolina, which generated about $1.1 million in lease income during the quarter.

Tabar said NC1 began contributing revenue in August from its first 20-megawatt data hall. Temporary switchgear issues slightly delayed the ramp, but all 40 megawatts of contracted capacity are now operational and billing, he said. The capacity is tied to an $865 million contract over 10 years.

Native staking revenue rose to $1 million from $903,000 sequentially, with the company earning 474 ETH compared with 440 ETH in the second quarter. Bitcoin mining revenue fell to $2 million from $2.4 million as production declined to 28.4 Bitcoin from 32.3 Bitcoin.

Cloud, colocation and staking accounted for about 91% of consolidated revenue, up from approximately 74% a year earlier, Tabar said.

Profit Includes Digital Asset Gains and Conversion Expense

Consolidated net income was $0.6 million after $27.9 million in losses were allocated to noncontrolling interests. Net income attributable to Bit Digital shareholders was $28.5 million, or $0.08 per diluted share, Huang said. The results fully consolidated WhiteFiber, with a portion attributable to noncontrolling interests.

The company recorded $84 million in gains on digital assets and a $10.7 million gain from remeasuring a derivative liability associated with its convertible notes. Other income included $17.1 million of unrealized gains on digital assets held through a third-party fund.

WhiteFiber’s settlement of a portion of its 2031 convertible notes resulted in an $80.8 million induced conversion expense. Consolidated interest expense was $10.4 million.

Huang said nine-month operating cash flow was $163 million, materially supported by customer advance payments for services not yet delivered. Remaining performance obligations totaled $729 million at quarter-end, but he cautioned that the figure excludes lease arrangements and certain other items and is not a consolidated revenue forecast.

Ethereum Treasury and WhiteFiber Financing

Bit Digital owned approximately 163,726 ETH and ETH equivalents at the end of September, according to Tabar. The company earned 474 ETH in native staking rewards during the quarter at an average annualized yield of about 3.4%.

Huang said Bit Digital converted some native-staked ETH into liquid staking ETH and used it as collateral to borrow U.S. dollars from Galaxy, allowing the company to continue receiving staking-related appreciation while financing a bridge loan to WhiteFiber.

The Galaxy borrowing carries a reported annualized rate of 5.5%, paid by Bit Digital. The WhiteFiber bridge has a 9.5% annualized interest rate and a 1.1-times multiple-on-invested-capital feature, Huang said. He said the facility had $100 million outstanding and that the company was looking for repayment in the second quarter of 2027.

Tabar said WhiteFiber had closed a $300 million secured credit facility, expected to be funded later in the month, that would support repayment of the bridge loan. Bit Digital had $143.5 million in consolidated cash and cash equivalents at the end of September.

Buybacks Remain Under Consideration

Tabar said Bit Digital’s articles of association require shareholder approval for a repurchase program, including how purchases would be made. Management also needs to determine how to fund any buybacks while preserving liquidity and assessing the effect on value per share, he said.

Selling ETH to fund repurchases would reduce the share count but also sacrifice staking rewards and exposure to any future increase in Ethereum’s value, Tabar said. He added that there was no set discount to net asset value that would trigger such a sale.

During the question-and-answer session, Tabar said Bit Digital might sell a portion of its WhiteFiber stake in 2027 and potentially use the proceeds to repurchase Bit Digital shares. He said there was no target stake or fixed plan and that any sale would be measured to avoid putting selling pressure on WhiteFiber shares.

Management also discussed an early-stage, revenue-generating business under development. Tabar said decentralized finance was among the possibilities, while Huang declined to provide details and said the company expected to offer more information in the first quarter of next year.

About Bit Digital (NASDAQ:BTBT)

Bit Digital, Inc. is a digital-asset and infrastructure company whose activities include Bitcoin mining, Ethereum staking and computing services for artificial intelligence workloads. Its operations have expanded beyond cryptocurrency mining as it develops data-center capacity and related infrastructure for high-performance computing. The company has conducted Bitcoin mining operations in North America and participates in Ethereum staking, which involves supporting the network and earning rewards for validating transactions.

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