Mawson shares plunge as crypto miner misses revenue by 40%
Q4 gross margin collapsed to negative 33% as litigation settlements offset operational challenges
Mawson Infrastructure Group Inc. shares tumbled in pre-market trading Friday after the cryptocurrency mining company reported preliminary fourth-quarter revenue that fell nearly 40% short of analyst estimates, capping a tumultuous year for the digital infrastructure provider.
The Sydney-based company posted preliminary revenue of $3.2 million for the quarter ended December 31, 2026, missing the consensus estimate of $5.3 million by 39.6%. The figure represents a 79% decline from the $15.1 million reported in the same period a year earlier, signaling a dramatic reversal after a stronger third quarter in which revenue reached $13.18 million.
More concerning for investors was the collapse in gross margins, which swung from a positive 31% in the prior year to a negative 33% in the fourth quarter. The company's net loss widened to approximately $15.8 million, up 250% year-over-year. Mawson's stock fell 8.9% in pre-market activity, trading around $2.87 and hovering near its 52-week low of $2.74.
The sharp deterioration in operational performance underscores the volatility facing cryptocurrency miners amid fluctuating Bitcoin prices and competitive pressures in the digital asset space. Mawson, which operates Bitcoin mining facilities in the United States and Australia powered by 100% carbon-free energy, has been navigating a challenging market environment while simultaneously managing legal disputes.
In a potentially positive development, the company announced it had reached settlements in two separate pending litigation cases that are expected to eliminate a significant portion of its potential financial liability. One settlement involves a confidential agreement with Ionic Digital Mining LLC regarding a co-location dispute, while the second addresses a customer disagreement over hosting arrangements. Mawson stated it made no admission of liability or wrongdoing in either case.
Kaliste Saloom, interim CEO and general counsel of Mawson, said the settlements would allow management to focus on operational execution. "We are pleased to move forward from these pending cases and significantly reduce Mawson's potential liability," Saloom said in a statement. "The clarity we now have on the future strength of our balance sheet will allow us to focus on driving operational execution and long-term growth for Mawson."
Despite the legal resolution, analysts maintain a cautious outlook on the stock. The average analyst target price stands at $3.00, only modestly above current levels, while technical analysis indicates a "Strong Sell" signal. The company's shares have lost more than 90% of their value over the past 52 weeks, having traded as high as $40 in the period.
For the full fiscal year 2025, Mawson reported a preliminary net loss of $23.8 million, representing a 49% improvement from the previous year. The company's trailing twelve-month revenue totals approximately $51.6 million, down from $59.3 million in fiscal 2024, according to market data.
Mawson's business model combines Bitcoin self-mining with customer co-location services, aiming to connect the emerging digital asset industry with traditional capital markets. As of November 2024, the company reported a combined operating hashrate of approximately 4.98 exahashes per second across both self-mining and hosted operations, with total operating capacity of 129 megawatts.
The company provided no forward guidance in its preliminary announcement, leaving investors uncertain about the path to profitability. With negative book value of $8.99 per share and a market capitalization of just $3.6 million, Mawson faces significant hurdles in restoring investor confidence following the disappointing quarterly results.
Cryptocurrency mining stocks have experienced heightened volatility amid broader market uncertainty and regulatory scrutiny of digital assets. Mawson's reliance on Bitcoin mining as its primary revenue stream exposes it to cryptocurrency price fluctuations, while increasing competition for mining rewards has pressured margins across the sector.