CleanSpark (NASDAQ: CLSK) - not quite an ordinary energy company from Nevada, which was founded in 1987 under the name Stratean, and the current name appeared only in 2016.
The business capitalized on industry-accustomed renewable energy developments for private clients and offered microgrid solutions to commercial organizations., energy efficiency and internet of things. At the end of 2020, management made a bold decision to expand, and CleanSpark set a course for industrial bitcoin mining.
What he earns
MVoult. Integrated energy supply system for private houses, which consists of a controller and batteries for storing electricity and is controlled using a mobile application. The use of microgrids provides a functional advantage: power supply can come from a common distribution network, solar panels and other generators or even autonomously using the accumulated battery charge.
Commercial Solutions. CleanSpark provides end-to-end energy solutions for organizations, including work with the military sector: network design and debugging, creation and connection of microgrid infrastructure of new facilities, improving energy efficiency and installing solar panels.
GridFabric. Middleware, which helps devices save energy within the network and is primarily aimed at use in the Internet of things. Consists of a Canvas server and a Plaid client.
Mining bitcoin. The company decided to apply and develop its developments in the field of decentralized energy networks based on the production of decentralized cryptocurrency. On 31 December 2021 CleanSpark has developed computing power in 1,9 exahesh per second and has in its arsenal 18 800 running ASIC miners.
What's wrong
Unprofitableness. So far, no growing revenue, no innovative solutions have made CleanSpark profitable. At the end of 2020, the business boldly entered the cryptocurrency mining market, therefore, in the coming quarters and years, investors, probably, don't expect profit: the issuer's development costs will grow even stronger.
Competition. In the industrial mining market, the company will face serious rivals: while CleanSpark builds and optimizes production, the same Riot Blockchain and Marathon Digital own 2-3 thousand independently mined bitcoins and are waiting for the supply of pre-ordered miners to increase their already large capacities.
change. The company may be adversely affected by a sharp turn away from developments typical of the energy sector towards cryptocurrency mining. As a matter of fact, at the end of 2020, CleanSpark significantly changed the business model and made mining its main activity within a year, which now takes a significant share of the money. This raises concerns, that other developments will not get enough attention and finance, and consequently, their quality will also fall.
What good
Growth in revenue and business. IN 4 quarter 2021 revenue increased to $49.4 million, which was almost a fourfold increase compared to the same period last year. The company acquired two data centers in Georgia, in a year was able to increase the total computing power from zero to 1,3 exahash per second and independently mine 218 BTC - the mining business is growing rapidly.
energy background. In competition with other miners, CleanSpark considers its own developments in the field of power grids and optimization of energy consumption and distribution processes to be a strategic advantage.. Electricity prices look good too: at two of the company's complexes, the cost of a kilowatt is less than three cents - this is approximately 30 $ per megawatt, which looks much more profitable than the tariffs of most competitors.
Sustainability. Shareholders' equity increased by almost 20 once, and in combination with zero debt, the company looks extremely stable - this inspires more confidence in the success of ventures in reorienting its business to mining and that, that the company is able to survive fluctuations in the price of bitcoin and other associated risks.
What's the bottom line?
CleanSpark took a risk, but an interesting solution to become the most technologically advanced miner and plans to gain an advantage over competitors due to colossal experience in the field of microgrids and energy efficiency.
The business is financially sound and is already reaping the benefits of its reorientation in the form of notable revenue growth., but at the same time, he bears the burden of large additional expenses and the risks of bitcoin volatility. The company's future looks bright, and it will be interesting to watch.
