Marathon Digital Holdings (MARA), a well-known North American cryptocurrency mining company, reported a lower-than-expected loss per share in the first quarter. The rising bitcoin price and increased production helped the company return to profitability, despite an audit by the US Securities and Exchange Commission (SEC) into related-party transactions that may have violated federal securities laws.

Financial results

Marathon’s net loss of $0.05 per share was lower than the $0.08 estimate of FactSet. The loss was also less than in the previous quarter ($3.14) and for the same period last year ($0.12), according to the report published on Wednesday. In addition, revenue increased to $51.1 million from $28.4 million in the previous three months, although it remained almost the same as last year. Analysts had expected revenue for the quarter to reach $48.8 million.

Cryptocurrency mining operations

Last year, Marathon faced construction and operational challenges, such as the bankruptcy of hosting partner Compute North. Nevertheless, the company increased production: the operating hashrate grew by 64% quarter-on-quarter to 11.5 exahash/sec, and bitcoin production reached a record high of 2,195 BTC ($80 million) this quarter. The price of bitcoin increased by more than 70% in the first quarter.

SEC investigations

Despite Marathon’s positive financial results, the company received another subpoena from the SEC, which is investigating related party transactions that may have violated federal securities laws. Marathon is cooperating with the investigation.

Chairman and CEO Fred Thiel remains optimistic about the company’s performance despite industry turbulence in 2022, stating: “After a tumultuous 2022 that tested the resilience of our entire industry, this year is off to a strong start as we increased hashrate, lowered production costs and improved our balance sheet during the first quarter.”

Marathon’s shares fell by more than 2% in pre-market trading on the Nasdaq on Thursday.