American Bitcoin's $126M Profit Rests on Bitcoin's Rally

Daniel Okafor

American Bitcoin reported roughly $126 million in net income for the third quarter ended Sept. 30, reversing a $57.2 million net loss in the second quarter. The Nasdaq-listed Bitcoin miner, which trades as ABTC, also reported adjusted EBITDA of about $221 million, compared with a $45 million loss in the prior period.

Hut 8 majority-owns the Trump-family-backed venture. Co-founder and chief strategy officer Eric Trump said: “These are significant results, particularly in a challenging digital asset market,” referring to the profit and the increase in Bitcoin held per share.

CEO Mike Ho attributed the performance to “a disciplined, Bitcoin-denominated operating business,” saying the company continued “mining Bitcoin at a structural discount to spot.” That model added Bitcoin without requiring shareholders to fund the reserve through the at-the-market share program during the quarter.

What drove the $126 million profit?

Most of the reported turnaround came from a $197 million gain on American Bitcoin’s digital assets as Bitcoin’s book value rose during the quarter. That contribution exceeded the company’s roughly $126 million net income, so the headline profit reflected both the valuation gain and its mining operations rather than mining alone.

The distinction matters because digital-asset gains reverse if Bitcoin falls. A lower quarter-end BTC price could therefore push reported earnings back into a loss without a comparable change in production, a risk reflected in American Bitcoin’s 41% gross margin and higher mining cost.

American Bitcoin ended September with about 8,427 BTC, roughly 425 coins, or 5%, above June. The company lifted its “satoshis per share,” which measures how much Bitcoin backs each share, by about 5% as well.

It achieved that increase without buying Bitcoin or issuing new shares through its at-the-market program during the quarter. American Bitcoin instead relied on mined output, meaning reserve growth tracked production rather than treasury purchases or new ATM issuance during the period.

How did mining economics change?

Mining conditions weakened at the same time. American Bitcoin produced about 891 BTC, down from 932 BTC in the second quarter, while its cost to mine rose to approximately $42,100 per Bitcoin from $36,500.

The company attributed the $5,600 increase to higher seasonal power costs. Its gross margin fell to 41% from 49%, narrowing the margin available from production even as Bitcoin’s higher accounting value supported earnings.

At quarter-end, American Bitcoin operated about 89,242 miners with 28.1 exahashes per second of capacity. The company had also notched a record mining quarter earlier in the year, when its holdings crossed 8,000 BTC.

What happened after the July reverse split?

The earnings recovery followed a difficult stretch for the shares. American Bitcoin’s stock hit new lows, and the company executed a 1-for-15 reverse stock split in July. Trading levels have remained well below the debut price reached after its public-market merger with Gryphon Digital Mining.

The quarter presents two separate operating signals: a mining business with lower output, higher costs and a narrower gross margin, and a Bitcoin treasury whose reported value rose sharply enough to create a $197 million gain. The treasury valuation supplied most of the profit, while cost pressure limited the benefit from mining output.

What has to change next?

The next quarterly results will show whether American Bitcoin can preserve its improved Bitcoin backing per share while narrowing the gap between production and costs. The company’s satoshis-per-share metric and any renewed use of its at-the-market program will show whether reserve growth remains internally funded.

The next market-structure test is whether ABTC can keep expanding Bitcoin per share while reported profit remains exposed to BTC’s price and its mining margin remains under pressure. If Bitcoin falls and mining costs stay near $42,100, American Bitcoin could post a loss even while its coin count continues to rise.