Riot Platforms Stock Tumbles After Bitcoin Production Decreases

Bitcoin mining and digital infrastructure company Riot Platforms is tumbling this morning, dropping as much as 8% before recovering to about 5%

Riot Platforms (NASDAQ:RIOT) is trading lower on Monday, after the company's bitcoin production fell in February.

What Happened: Bitcoin (CRYPTO: BTC) mining and digital infrastructure company Riot Platforms is tumbling this morning, dropping as much as 8% before recovering to about 5% down as of 10:50 a.m. ET. Meanwhile, bitcoin is somewhat stable, hovering around $91,000, as the crypto industry is in a wait-and-see mode until tomorrow’s inaugural White House Crypto Summit.

Riot released fourth-quarter and full-year financial earnings on February 24. The company’s results exceeded expectations, primarily due to bitcoin mining revenue, but it didn’t lift the stock.

On March 4, the company said its bitcoin production declined month-over-month, mining 470 bitcoin in February vs. 527 in January. Production was “impacted by planned maintenance, elevated curtailment driven by higher power prices as a result of colder weather, and a shortened month,” Riot CEO Jason Les said in a press release.

Today, Seeking Alpha analyst Deep Value Investing downgraded Riot to a Strong Sell "due to anticipated inflation risks impacting bitcoin's performance, similar to 2022."

"I foresee rising inflation due to tariffs and government cost-cutting measures, which could delay interest rate cuts until 2026. Historically, bitcoin has struggled in such environments," the analyst wrote.

Riot overall is down nearly 20% year to date as uncertainty around bitcoin’s price puts pressure on the company’s outlook. At the end of February 2025, the company’s bitcoin holdings stood at 18,692, worth roughly $1.7 billion. This places Riot as the third-largest public company holding bitcoin, behind Strategy and MARA Holdings.

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What’s Next: At the beginning of the year, Riot said it plans to install at least 12,000 next-generation bitcoin miners in 2024, nearly double the number it deployed in 2023.

The company also recently announced the expansion of its bitcoin mining operations with the purchase of additional miners from Bitmain.

Riot is expected to report its first-quarter financial earnings in late April or early May.

What's New: Riot Platforms saw its stock decline on Monday, potentially due to a report by Seeking Alpha that an analyst downgraded the company's rating and pointed to anticipated inflation risks that could impact bitcoin's performance.

The analyst, who contributes to the Deep Value Investing service, downgraded Riot to Strong Sell from Hold and cut the price target to $15 from $20.

In a note on Monday, the analyst, whose identity is not disclosed by SA, said: "I foresee an uptick in inflation as tariffs will be imposed to reduce the trade deficit, while government cost-cutting measures will be implemented to decrease the deficit. This will have the effect of delaying the interest rate cuts, which I now anticipate to commence in late 2025 and proceed at a slower pace than previous estimations. From a historical perspective, bitcoin tends to struggle in periods of sustained inflation."

The analyst also noted that Riot's stock has already recovered significantly from its 2022 lows and now trades at a premium valuation.

However, the analyst said that they still prefer other bitcoin miners, such as Bitfarms (OTC:BITFF) and Hut 8 (TO: HUT8)(NASDAQ: HUT), which are currently rated as Buys.

"I am more optimistic about Bitfarms, considering its potential for a complete debt repayment by year-end and the possibility of a merger with a special purpose acquisition company (SPAC). Meanwhile, Hut 8 is viewed as a safer investment despite its slower growth rate," the analyst added.

Despite the recent sell-off in bitcoin, which has wiped out nearly $1 trillion in cryptocurrency market cap since November 2021, several analysts remain bullish on the digital asset in 2024.