Bitfarms bleeds $36M as it ditches Bitcoin mining for AI power play

Canadian Bitcoin mining firm Bitfarms has endured a steep $36 million net loss in the first quarter of 2025. That’s a huge climb from last year’s $6 million loss experienced in the same quarter.

The firm has said this is a consequence of a huge shift away from its mining focus on Bitcoin towards high-performance computing (HPC) hardware to facilitate artificial intelligence (AI) uses.

The move comes as the crypto industry grips with turbulence. Bitcoin’s spot price, which swung from above $100,000 to below $80,000 in March before climbing to over $103,000 in May, experienced significant volatility in the first three months of the year. But the April 2024 Bitcoin “halving,” which reduced mining rewards by 50%, has dealt a heavy blow to miners.

Bitfarms leads shift toward AI as mining profits shrink

Bitfarms’ pivot reflects a broader trend among miners reevaluating their strategies. As profits from crypto mining decline, miners are exploring new opportunities by leveraging their existing infrastructure—advanced computing power and substantial energy capacity—to tap into the rapidly expanding artificial intelligence sector.

Bitfarms CEO Ben Gagnon said the company had made progress in several key areas as part of its strategic shift to the U.S. and high-performance computing. He noted that mining now offered a stable foundation, enabling Bitfarms to focus on building its future in AI while still positioning itself to benefit from potential Bitcoin gains in 2025 and 2026.

Industry analysts agree. A March report by Coin Metrics noted that miners are “diversifying into AI data-center hosting as a way to expand revenue and repurpose existing infrastructure for high-performance computing.”

Bitfarms’ Q1 earnings report reveals both potential and pain. On a year-over-year basis, the company saw a 33% increase in revenue, bringing in $67 million in sales. But gross profit margins fell to 43% from 63% a year earlier. The margin erosion largely stems from the Bitcoin halving in April and price volatility during the quarter.

These all led to lower profitability from mining operations, which has been the foundation of Bitfarms’ business.

Investors have responded cautiously. Bitfarms stock has dropped considerably from its 52-week high and currently carries a price tag of $1.09 per share. The company has been dropped from a few crypto-specific investment pools amid an uncertain revenue focus.

The firm argues that its move is both well-timed and necessary.

Bitfarms expands AI infrastructure with strategic investments

To power its AI future, Bitfarms has taken several bold steps. In April 2025, the company secured a $300 million line of credit from Macquarie Group. This capital will finance the expansion of a high-performance computing (HPC) data center in Pennsylvania, one of its new AI-focused hubs in the United States.

This facility is expected to be central to Bitfarms’ shift toward offering cloud computing services for AI companies, including those developing large language models and training neural networks.

Bitfarms has also trimmed its crypto assets. In January 2025, it sold its Paraguay Bitcoin mining facility to Hive Digital for $85 million. The proceeds are being reinvested in its growing AI infrastructure footprint.

The Canadian Bitcoin mining firm has completed a transformative fleet upgrade, improving its Bitcoin mining efficiency and reducing operating costs, with over 94% of its purchased miners now installed.

The company is looking to follow the success of peers like CoreWeave — a once-small mining outfit that has rebranded into a major AI computing provider. CoreWeave reported explosive revenue growth of 420% year-over-year in its Q1 2025 earnings, reaching $981.6 million. It is now valued at over $20 billion.

Bitfarms Ltd has stopped publishing monthly Bitcoin production reports, which may reduce transparency for investors focused on its mining operations. Still, it reflects their confidence in the AI sector. As AI models become more data-intensive, the demand for energy-hungry data centers will continue to grow. Bitcoin mining companies — already experts in cooling systems, GPUs, and energy management — are naturally positioned to seize this opportunity.

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