HIVE - NASDAQ

Welcome to today's webcast reviewing HIVE Digital Technologies Financial Results for the First Quarter ended June 30, 2023. On Slide #2, I would like to briefly note disclosures. Except for statements of historical fact, this presentation contains forward-looking information within the meaning of the applicable Canadian and U.S. securities regulations. These forward-looking statements are based on expectations, estimates and assumptions as of the date of this presentation. On the next slide, I'm pleased to introduce today's presenters: Frank Holmes, Executive Chairman; Aydin Kilic, President and CEO; and Darcy Daubaras, Chief Financial Officer. I would now like to hand the presentation over to Mr. Frank Holmes for a macro recap of the quarter. Frank?

Thank you, Holly. And thank you, all of our loyal shareholders. I hope you find this informative timely and a little bit entertaining like this DNA of volatility, which I really like to always use as a case study that every asset class has it's own DNA of volatility, and what I thought was really surprising was looking at HIVE over 10 days at 26%. And over a month rolling 20 days, it pushes 50% volatility, and I find that just incredible. But we've become a proxy for so many gold investors at the beginning, and then along comes crypto investors, especially those who are interested in the adoption but they're reluctant after blowups like Celsius and FTX, HIVE has become that proxy. So please, when you look to invest in HIVE recognize that the DNA of volatility is 6x that of goal of the S&P 500 and substantially over a 10-day period. So the idea by the dip is wisely thought through here. Now what's also interesting to us is that it appears a quant fund, maybe a Citadel or someone else, that the crypto stocks trade as a basket by the minute. I do not believe that retail people jump in all collectively like this. But the correlations, as you can see, are very, very high. HIVE, it's 0.86, to Riot is 0.96 to Bitfarms to Hut 8 is 0.94. And I just think it to Bitcoin, as you can see, HIVE has this very strong correlation. And the next 1 is to show you that we do offer like gold stocks, high-quality gold stocks due to the price of gold that they give you 2x to 3x the leverage on the upside, but they also give it to you on the chin on the downside on corrections. This is showing over year to date and it's quite significant gold surge to mid July up to 81%. Goal this year was only up 7%. The S&P was up 17%, but HIVE was up 315%. So it has done a positive 12-month rate of return and in the first, especially because of the rebound this year. HIVE Digital Technologies, they've used a new name and strategic expansion to power the future of artificial intelligence with this NVIDIA GPU cards. When we bought our NVIDIA cards, we bought a card that was not just Mining Ethereum, but had the capacity to grow as we've -- over 3 years ago, we started this journey of building out a B2B AI functionality using our chips. And so it's really come to fruition and quickly picked up the speed with the ChatGPT. But I think that's what's interesting is several of our peers bought NVIDIA chips, but they were single purpose. Ours are not. Now when it comes to this new space, it is very complex. And I've noticed several of our peers jumping in, making announcements, et cetera. But it is -- HIVE is the only 1 that has this experience of mining with GPU chips and branching out into offering AI services. And when you mine for Bitcoin, it's really simple. The quality of the chip, is it new? Is it more efficient on the energy consumption per hour? And you plug it in and you run it and you need a few people in managing a facility. When it comes to a data center where you're using for AI, it's much more complex. And I want to give you a simple metaphor I've learned on this journey. It's like going to McDonald's with 3 to 4 kids in the car. And you're trying to order. Do you want a Happy Meal? Do you want Superfries? What do you want, et cetera. And so when they go in -- and when you go into the space of artificial intelligence, those that want to use our services, they will look at what type of short-term memory RAM do you have? We'll pay an extra $0.10 a minute. Long-term memory will pay $0.08 a minute. Or this chip of A40, okay, will give you $0.70 a minute. 6,000, okay, we're going to give you $1.20 a minute. And so each client and each user is looking at a host of services that you have to provide in this space. And to me, it was just such an interesting learning curve that are reminding me of this B2B business strategy is not easy and it is complex. And so investors have to recognize that very few people, except for pure data center providers have this skill set. HIVE does and HIVE has over 6 years of experience in GPU mining. So let me give you a macro recap of things that I think are important in the crypto ecosystem. Bitcoin is a decentralized portable wealth. And I always get concerned when I've seen this in the gold space that using JPMorgan's quote which is here. JPMorgan said, gold is money and everything else is credit. Well, this is before the U.S. government basically changed the rules in 1933 and only allowed America's own numismatics. This is before the GLD ETF. Today, I am sure Jamie Dimon would never say this because governments and the Bank of International Settlements get really upset that gold is not money, that gold is a wealth, an alternative asset class and wealth. And I think that, that's as important so as Bitcoin. Bitcoin is portable, digital wealth. And that's what's really important to see how the adoption, and Bitcoin has validated the ecosystem that's ushered in. So many countries now are trying to come over with their own central bank money. And I think that, that's what's important for investors to recognize that transition. But let's talk about this. Let's talk about something that I've learned in my journey as a top-ranked gold fund manager, and recognized that it's all about government policy. It doesn't matter if it's a Democrat or Republican at the helm. It doesn't matter the Prime Minister of the country is. The responsibilities when you're that leader is basically fiscal policy. And what's interesting is the Internet bifurcation to 0s and 1s. And when you look at government policy, it also keeps us binomial model that is monetary or fiscal. And monetary are real interest rates. And money supply, they have a big impact on the overall currency. And so do fiscal policies, where is taxation going and regulations and then where is the spending going. And historically, whenever there's a big imbalance between any country's monetary and fiscal policy or you can get what's called monetary drag or fiscal policy drag due to regulations they're implementing, then gold becomes an historical basis, an important asset class to balance that. And Bitcoin has now taken over. This is important, with millennials in particular, as their choice as a balancing factor between the imbalance between monetary and fiscal policy. When you understand that, you get a better appreciation. It's not just political parties, it's policies. So what I do believe in a macro trend that's happened as material this week is PayPal's announcement. And this just really impacts the global adoption of Bitcoin and the crypto ecosystem. When PayPal launches a stable point, it's to over 400 million global accounts. That's not as big as when Facebook came out with its Libra Coin and there was such a big backlash by the Bank of International Settlements and the G20 central bankers and finance ministers that they're a real pylon to Facebook. It ended up being sold damaged by it. They lost hundreds of millions of dollars and they ended up change to their name. And I think it's sort of an interesting exercise. It's different today. I wish that the government had created policies and some basic framework for the crypto ecosystem because that will still become a concern. But PayPal is already in digital payments. They already have a global footprint and a strong reputation. And so now after the Ripple lawsuit, the win by Ripple against the SEC, gives them a new confidence to come out with this. And I think it just helps with the global adoption. I do believe that the crackdown by the SEC was a huge speed bump to the adoption. And in particular, because it became so political with Sam Bankman-Fried and his FTX implosion and Celsius CEO getting arrested and put away in jail. I think these things are all part of a slowdown to the adoption and now PayPal feels more comfortable and this is important for the overall adoption, coupled with and very significant. They must have got a phone call with BlackRock coming out with feeling confident enough that only 6 months ago had nothing but basically trash talk towards Bitcoin in the ecosystem and now is in full support of it, and is trying to fast track their own spot bitcoin ETF. So I think these are all positive parts in this global adoption. But let's talk about HIVE and how we've been the first. And we look upon ourselves as being a technology company, and we're the first to go public in Canada in September 2017. We were first to buy our data centers, we were first to go and balance electrical grid. We're first to develop our own ASIC mining rig with Intel chips. And then we were first to have a green energy focus. And first, to have an AI strategy in how we were buying our GPU chips. In our last big purchase, we're not, which we originally have were AMD chips. This has been now pivoting over 18 months ago buying NVIDIA chips to fast track our ability to build out our data centers for AI. The leadership team, it's small. It's a small team. The CEO and President is Aydin Kilic who is an electrical engineer. We have Darcy Daubaras who is the CFO, who has probably the longest-standing experience as a CFO of a public company in the crypto data center business. Johanna Thornblad, who is the President of Sweden; and Gabriel Ibghy, who's our General Counsel. HIVE has green energy focus in Canada, Iceland and Sweden. HIVE has a community commitment, which we've done in sponsoring the HIVE Arena because hockey is such a key element and the funding of 12 kids hockey teams is important. So kids are not on the street, kids are out being active. And this is a community that has 3 players that have gone onto -- go into the NHL and win Stanley Cup. So it's a very proud small community, and we're so happy and proud to be able to be involved in that community. We're also -- our vision in that community is to provide food security to the local communities, take away a global footprint from from half of the ship, produce from Spain and Italy. And the vision is building up a 95,000 square foot greenhouse, taking the heat from our facility and recycling that to have a huge production of vegetables. We are successfully recycling heat in Lachute, Montreal, where we heat up building 5x -- sorry, 4x -- 5x of size because 1 building is about 40,000 square feet, where we're mining Bitcoin and we've been able to heat during the winter of building 200,000 square feet. So the capital structure of HIVE, this visual of AI relates to the name change and the rebranding, which we focused in particular Canada as a re-branding -- the ticker stays the same except for on the German exchange. It changed the voo.f. We have a very tight float. We have been very, very conscientious of doing everything to have the highest cash flow return on invested capital. Revenue for over the last 4 quarters, Darcy is going to give you more granularity in the presentation. But as you can see, it does follow Bitcoin price as a big impact. Now we have been challenged the whole industry by more people mining Bitcoin, which is very rare that you would see Bitcoin prices fall over the past 12 months, probably rebound but that more people would enter the business and so the thought process of companies like Bitmain who is the biggest -- 1 of the biggest manufacturers ASIC chips are actually co hosting and mining to get their capital back faster and they've driven up the competition. And the other parts are countries in desperate of U.S. dollars have -- with low-cost energy have been mining Bitcoin. But all I do know is that America has become the dominant player in this ecosystem and leaders in innovation. So I'm very happy to be involved in that sort of growth profile. But through this whole journey since 2017, HIVE has always had a very low SG&A per Bitcoin mined. As you can see, that means minimum dilution how we issue stock options, how many employees we have. I believe we have the highest revenue per employee gets this whole system. We have a very low fixed debt on our balance sheet. We do not pledge any of our equipment. And so you've seen some of these other countries blow up and implode because of these debt structures from Core Scientific, who is the biggest, it ends up imploding, Argo implodes. So we can see that this idea having a very conservative balance sheet because I mentioned earlier in my experience in the gold industry, when you have a high volatile asset class, then you have to be very conscientious of your debt structure and what you collateralize against. So for your shareholders, we give you the biggest bang for your buck. Hashrate utilization, HIVE continuous by Anthony Power to be able to give you a very high Hashrate utilization, and that's because of the team of how they function every day from daily meetings early in the morning from the West Coast to make sure they touch base with everyone in Sweden before they slow down at 4:00 in the afternoon at 7:00 in the morning Vancouver. Every day is a scrum call, every day is they know what machines, any challenges or difficulties and take things off-line so that we can help and huddle and find solutions to problems, that's led to this incredible Hashrate utilization. Our Bitcoin production for Exahash were right there. It's always seems to be 1, 2 and 3. Interesting enough Bitcoin is very strong in Canada and have expanded into Latin America, and they have a great team. We can see the share price growth in the last 30 days. We do -- Aydin is going to go into greater detail of showing you the amount of dilution though that's taken place with the financing that's been done or the stock issuance in the SG&A is much higher for many of these other companies. So I think I'm proud to see that we've seen as Bitcoin with the 31,000. We, with our AI strategy and the rebranding to high digital -- and our strategy there has seen good shareholder support. I have always believed that green and clean big points will over time become more valuable as a digital asset because a supplies cap at 21 million coins. Like any [indiscernible], I have said when supply is capped and adoption expands over time, the value of these prints have gone up substantially. Now with the explosion in order mills, we are experiencing new growth in special number Satoshi's. And Aydin is going to go through in greater detail, but I think it's really important to explain to the shareholders that the utility of Bitcoin was long limited to storing and transferring value with minimal developer activity on the network. The developers were all focused on Ethereum when it was proof of work and now it's gone over to proof of state. So it's sort of interesting to see that these developers are going to the Bitcoin infrastructure. Now the emergence of Bitcoin DeFi launch protocols like RabbitCoin, WBTC, STX and rootstock, RBTC, brought crypto borrowing and lending to the Bitcoin network, opening up new cases for the cryptocurrency. Now the arrival this year of Ordinals, the protocol has expanded the utility of the Bitcoin network even further. The Ordinal protocol enables developers and artists to create and store digital artifacts directly on the Bitcoin blockchain. The protocol has been a massive hit with over 100,000 ordinals already minted. The introduction of the technology has caused Bitcoin metrics to skyrocket with a number of non-zero Bitcoin addresses hitting a record $44 million following the launch of Ordinals. Already Bitcoin's block sizes have also increased touching an all-time high, up 2.5 megawatts on February -- sorry, MB on February 12th. And I think that -- so what the Bitcoin Ordinals and why they're causing such a star earlier this year is the Ordinals protocol allows users to send and receive SaaS that carry optional extra data such as text, JPEGs, audio and videos. Adding such data to a Satoshi is known as inscription, and the result has been considered a Bitcoin NFT or called an Ordinal. Well, nearly 100,000 scribe Satoshis have been minted since the launch of the Ordinal Protocol including the collection of Ordinal Punks at Ordinal Penguins and Bitcoin Offshoots and popular NFT collections. It's important to note that ordinals are only possible thanks to the witness section of the Bitcoin transactions that was introduced after the top route soft fork in 2021. This is where JPEGs, audio files and videos are inscribed into the individual sites. Bitcoin ordinals can be considered NFTs, but they have some significant differences. Most NFTs are created and tracked through a smart contract with the assets they represented hosted elsewhere. In contrast, Ordinals are inscribed into the Satoshi and therefore, Bitcoin NFTs are stored on chain. Trends, traditional NFTs usually have metadata that allow creators to change the appearance and characteristics of NFT. But since ordinals are stored on chain, their data is immutable and cannot be changed. Also unlike NFTs, ordinals do not provide creators with the option to receive royalties on subsequent sales. In short, Ordinals are immutable and complete digital artifacts that cannot be tampered with or reside -- and reside completely on the chain. So it's an important innovation. You're seeing money being created for 2 things due to basically fast track the adoption into what -- in addition to what PayPal has been doing. It is the lightning network so they can get down the cost of transactions and the idea of funding more culture, more artists, more bootstrap funding is now getting VC funding to attract developers into this ecosystem and really embrace art. Art is such a key component for global adoption in the space. So innovation, as we can see the daily inscriptions I mentioned earlier, exploded earlier this year, they've tapered off, and I think we're going to see other waves coming. Bitcoin Ordinal's innovation, 1 Bitcoin is 100 million Satoshis. And what Aydin is just going to talk about is that what we found is something that's worth next to less than $0.01, all of a sudden if they're in an inflection point where there's a limited supply that they're uncommon, they can become extremely valuable. And so I think it's important that you listen to Aydin as he goes through gives you more granularity on this macro trend. But now I want to talk -- turn it over to a snapshot of financial growth by Darcy, our CFO. Thank you, everyone.

Thank you, Frank. As usual, around this time of the presentation, I will be taking you through a snapshot of the part year looking at the most recently completed quarter and some indicators. Next slide, please. First of all, I'd like to remind our listeners that our earnings are comprised of our operational earnings plus our investment earnings, which includes realized and unrealized earnings a lot of which include noncash charges. Mark-to-market and accounting is an accounting practice that involves -- actually, we can take it to the next slide. There we go. Mark-to-market is an accounting practice that involves adjusting the value of an asset to reflect it's value as determined by current market conditions. Market value is determined based on what a company would get for the asset if it was sold at that point in time. Mark-to-market losses are paper losses generated through an accounting entry rather than the actual sale of the security. Swings in digital assets impact paper profits and losses each quarter. So our Bitcoin digital assets do generate unrealized gains and losses each quarter depending on the price of Bitcoin compared to the prior reported period. And it's important that investors understand the differences in operating earnings or losses in addition to mark-to-market paper gains and losses each quarter as it can swing the results drastically. Noncash charge is a write-down or accounting expense that does not involve a cash payment. Depreciation, amortization, depletion, stock-based compensation and asset impairments are common noncash charges that reduce earnings but not cash flows. Next slide, please. During this most recently completed quarter of June 30, 2023, we recorded $23.6 million of revenue and $5.3 million in adjusted EBITDA. This was driven by production of 834 Bitcoin equivalent mined at an average cost of USD 18,687 per bitcoin. Turning to the next slide. Our cash position stood at $4.5 million at June 30, 2023 along with an additional $59.5 million in Bitcoin digital currencies. We also had $9 million in amounts receivable and prepaids. Amounts receivable mainly consisted of sales tax receivables this quarter. The market value of our strategic investments decreased during the quarter by approximately $630,000 as a result of the mark-to-market accounting spoken about, bringing it to $2.2 million. We did not acquire or dispose of any investments during this period. We maintain a strong net cash position and healthy working capital to fund our operations and growth. Going on to the next slide. Our Bitcoin holdings at June 30, 2023, was 1,957 Bitcoin, down from the June 2022 month-end period of 3,231. We have strategically sold some of our Bitcoin over this quarter to invest in higher efficiency ASIC machines to get prepared for the halvening in the first half of 2024, and also using these funds to invest in high-performance computing equipment. Next slide, please. Our gross operating margin, which equates to our total revenues minus direct operating and maintenance costs decreased in absolute dollars to $8 million or 34% in the most recent quarter compared to $27 million or 61% in the prior year comparative quarter. Gross mining margin is also partially dependent on various external network factors, including the HIVE mining difficulty we continue to experience, the amount of digital currency rewards miners receive and the market price of the digital currencies at the time of mining which are on average lower than the prior comparative period. In addition, the company is no longer mining Ethereum since the merger took place on September 14, 2022, which has contributed to the decrease in gross revenue from digital currency mining by approximately 47%, but operating cost decreased by only 9%. In this most recent quarter, we are reporting a loss of $0.19 per share compared to a net loss of $1.41 per share reported in Q1 last year. Taking a look at our year-over-year revenue on the next slide. We generated total revenue in the first quarter of fiscal 2024 of $23.6 million versus $44.2 million in the prior year fourth quarter. The decrease in revenues versus the same quarter in fiscal 2023 can be attributable to 3 main headlines, and these might sound familiar. The ever-increasing Bitcoin difficulty Hash rates over the past year, the significant drop in the price of Bitcoin and to an extent, the Ethereum merge on September 15, 2022, as this quarter and operations moving forward does not include any Ethereum revenues. This triple punch contributed strongly to the significant drop in revenues that we experienced. As mentioned previously, our gross mining margin, which equates to our revenues minus direct operating and maintenance costs, decreased in absolute dollars to $8 million in the most recent quarter compared to $27 million in the prior year comparative. Moving on to the next slide, comparing our current fiscal Q1 quarter to the previous Q4 quarter, we generated revenue in the first quarter of fiscal 2024 of $23.6 million versus $18.2 million in the previous quarter. The increase in revenues versus the prior quarter was impacted by a stronger price of Bitcoin and 42 more Bitcoin mined this quarter. As the Ethereum merge took place on September 14, 2022, which was in Q2 2023 of our reporting cycle, neither of these quarters had any Ethereum mining revenues. Our gross mining margin increased in absolute dollars to $8 million in the most recent quarter compared to $4 million in the prior quarter comparative. Increase in gross mining margin versus the prior quarter was impacted for the same reasons as stated above for revenues. Operating and maintenance costs only marginally increased by 9%. Moving on to the next slide. Our adjusted EBITDA increased in this first quarter of fiscal 2024 to positive $5.3 million versus a negative adjusted EBITDA of $1.4 million in the prior quarter. I will highlight again that adjusted EBITDA is a non-IFRS figure. In the first quarter of fiscal 2024, we experienced a loss of $16.3 million compared to a profit of $6.6 million in the prior quarter. Main reason for the profit in the prior quarter and loss in the current quarter other than the reasons mentioned earlier is the increase in Bitcoin price in Q4 2023 leading to a significant revaluation of digital currencies gain, whereas the BTC price did not fluctuate too much in the current period. I'd like to thank our loyal stakeholders. And at this time, I would like to turn the presentation over to our CEO and President, Aydin Kilic. Aydin?

Executive update on our business. Let's jump into it. So it was a great quarter in terms of Bitcoin mining profit margins. We saw an uptick this quarter. We had 34%. You could see that difficulty actually increased. If you average the difficulty each quarter increase 24% quarter-over-quarter but we managed to keep our cost to produce a bitcoin quite consistent, only a 4% increase on our cost to produce a bitcoin, which, of course, we saw a lot of strength in the price of Bitcoin as it rallied to 28,000. And in addition to that, although difficulty increased 24%, we produced actually 5% more coins. So we outpaced the growth of the network difficulty by expanding as we march towards our year-end target of 6x a Hash and we're currently sitting at 3.7, which I'll talk about more shortly. Next slide. So July 2023, we just issued a press release for this, and we produced 263 bitcoin, an average Hash rate during the month of 3.46x a Hash, but we've been steadily increasing plugging in machines. We ended the month at 3.64x a Hash and did an average of 8.5 Bitcoin a day with a very, very strong 75.9 Bitcoin per Exahash. Again, consistently ranks amongst the top crypto miners when it comes to Bitcoin per Exahash, again, a credit to our technical team, resilience, high fidelity software running 24/7 in 7 time zones. We always make sure that our facilities are run top notch. And I'm very proud of my team for continuing to have great performance. Let's jump to the next slide. So ASIC acquisitions. Now to date, we have actually purchased over 11,000 ASICs just in 2023 alone. This does not include the purchases made in November and December of last year, which, by the way, have now ROI-ed almost 80%, that's right. The S19j Pros that we purchased for about $11 a Terahash on average in December have now ROI-ed almost 80%. So that's a stellar ROI profile, given that it's only been 8 months. And so we're targeting a 1-year ROI on those machines. And so this is how we distinguish ourselves. This is how we analyze the Bitcoin mining Hash economics and we only search for the best deals, what is the best dollar per terahash price in consideration to the machine efficiency. We don't always buy the best -- we certainly buy the best most expensive machine. Some companies just rush out and do big massive purchases when a new model comes out, no. We are all about analytics. We're all about best cash flow return on invested capital. And so throughout the course of 2023 February onwards, we made a series of purchases, some pro pluses, as you could see here, Jpros and even some XPs as we want to overall upgrade our global average fleet efficiency. And 1 exciting announcement that we just announced today along with our financials is that we purchased another 2,000 S19 XPs which will be immediate delivery. So we also like to buy machines that are readily available to ship. So as soon as that catch is deployed, they can start to ROI. So that's another excitement. -- exciting update. So let's hop to the next slide. So update on our Hash regrowth outlook. We're still targeting 6x Hash for the end of the year. We have about 2,000 machines from our 11,000 machine order ready to be plugged into the next week or 2. We're just adding some PDUs to New Brunswick. So we should be at 4x a hash in a week of 2. And I've updated the target for September to be 4.2x a Hash to include those additional 2,000 XPs that we've just purchased. Next slide. Overall infrastructure, 150 megawatts. So we've expanded a little bit our footprint in Iceland. And so we may not always utilize all of this power capacity because, for example, we might down clock some machines in order to have better unit economics, to have better efficiency. So they'll consume less power, but they mine more profitably. And so what we want to communicate to the market and let them know is that we have completed available to us 150 megawatts of operating infrastructure. And so this is what this slide summarizes for you. Next slide. our crown jewel, the flagship facility in New Brunswick, 4 buildings, 2 dedicated substations which we own, the land and all the buildings and infrastructure upon it. A beautiful shot of 1 of the great data halls. You could see that's the hot aisle. You've got the dual pass cathedral architecture. It's always a pleasure when I visit New Brunswick. And you could see it gets quite cool in the winter covered in snow. Let's hop to the next slide. So just a little bit about our corporate strategy. I know we've talked about this before, but it's worth revisiting. We actually expanded this analysis. And so it's going to show up on the next slide. But here, I want to emphasize as a precursor to the next slide, we at HIVE, right, we have a lean and mean mindset, right? High revenue per employee. We found out through third base -- third-party research from Luxor hashrateindex as well as Anthony Powers, who does great writing for Compass Mining that we have amongst the lowest G&A in the sector as a percentage of revenue. There is low share-based comp -- and if you look at share dilution last year, we had the lowest share dilution while maintaining a [indiscernible] position of 2,000 Bitcoin. So let's hop to the next slide, and I'm going to show you how that impacts your earnings. So we all talk about revenue and revenues measure the same across all crypto miners. Now what I have to emphasize is there are noncash charges that all crypto miners have to take on. And those can vary company to company because those are decided by the auditor. The auditor will determine what they're comfortable with. And therefore, we, for example, have aggressive 2-year depreciation of ASICs. So even if the ASICs are paid off quicker or slower than that, it doesn't matter. And by the way, we try to target a 1 year ROI whenever we make our investments as evidenced from the previous slide when I talked about our last December purchase, that's already at 80% paid off, which, again, will be free cash flow very soon after. And that's how we really want to grow the businesses with free cash flow, right? So we'd always have to raise money. And most importantly, deliver value to shareholders. We're all about cash flow return on invested capital. So getting back to the noncash charges, those are all recorded differently for all companies. I have a 4-year depreciation for ASIC M3, we have 2, okay? So that's not shown here. But what everybody does record the same as their revenue, their cost of goods sold, I mean that's your direct operating cost, your electricity, your data center costs, the staff, et cetera, insurance, whatever it takes for you to run your Bitcoin mine properly as a public company. And in addition to that, if you look towards the right of this chart, you have the SG&A. Well, that's the corporate operating costs, right? Executive -- salaries for the executives, your lawyers, your auditors, D&O insurance, traveling, going to conferences, any sponsorships you do, and any of the above -- and so what is the corporate entity spending to run. And so these are all sort of apples-to-apples comparisons that are on a cash basis. So the gross mining margin is reported. These are all from public filings by [indiscernible] at Yahoo! Finance, EDGAR or SEDAR. And you could see in the center, the gross mining margin column, right? This is calendar year 2022, by the way. And I will note, HIVE has a March 31 year-end. So what we did was we added up our individual quarters just because -- I mean, you can do that manually, and redo that to allow a consistent comparison across all companies. And in fact, -- some of these other companies have a year-end other than December 31. So we took the liberty of adding up their quarters. So we could do a January to December 2022 comparison. And this is what it looks like. When you see gross mining margin, which is the core operating business is actually negative for some of the crypto miners. We've got the color coding, so it's easier to read that. Now HIVE along with a couple of our peers, we're sort of north of $70 million -- I think you can see the top 4 here had gross mining margins, $60 million, $70 million and about $80 million, okay? But what about the G&A? Well, the G&A, I mean, you could see very drastically. It goes as high as $200 million. And for some smaller companies as little as $2 million. HIVE is a big company. I mean, we're 1% of the Bitcoin mining network. We've got our GPU business. We're in 5 jurisdictions, Sweden, Iceland, Bermuda, even Switzerland. So this SG&A for us is only $14 million, when a lot of our peers have $50 million, $60 million and even more to run their corporation. So what we do is, if you take off the G&A from the gross mining margin, what's left is what we call it corporate margin. And this is where HIVE has led the pack $55 million of corporate margin last year. And from there, this time, we didn't look at 6 companies, we looked at almost 20 companies. And you can see there was only about 4 companies that had a positive corporate margin, and the rest were in the red, something to think about when you're looking at investing in crypto mining stocks. I'm not here to really do anything other than just illustrate publicly available information through the financial filings, very interesting. And I'm very proud of my team for keeping it lean in me. Next slide. So we have seen Hash price at sort of back at the $0.07 range. But what we noticed in May was this big rally to well over $0.10 caused by Ordinals. And so what we did was in working with 1 of our strategic partners, Luxor -- we did a scan of our wallet and we found that we had some uncommon Satoshis. We did a press release about this is very exciting because we can get a massive multiple -- Let's look at the next slide. And so just to understand why there's such a demand and multiple payable that people are willing to pay for these uncommon Satoshis is because of their rarity. I mean you look at the total numbers, Satoshi's 2.1 quadrillion only $7 million of those 6.9 million are the first Satoshi [indiscernible] block. So we have over 200 of those. And then if you have rare, that's the first Satoshi at the beginning of a difficulty [indiscernible]. Epic is not having a tent. There's only 32 of those, et cetera. So anyways, HIVE having been mining for years and years and years. We're fortunate to have accumulated some uncommon Satoshis. Now my CTO is working on doing transactions whereby we're going to be able to start mining our own Ordinals and transacting with individual sets. We might sell some of these. We do have a buyer that's interested and we've have some an expression of interest to sell some of the premium, so it's very exciting. Next slide, please. HPC. So last but certainly not least. HIVE is known as being a best-in-class Bitcoin miner, but of course, of course, we are known for having our world-renowned fleet of NVIDIA GPUs -- and just to put it into context really quickly, I've had 150,000 GPUs running during the heat mining days, okay? About 110,000 of those were actually AMD gaming-grade GPUs, which were great for mining Ethereum and those have been mining since 2018 and those had had ROId 4x over by the time the merge happened. So they had repaid themselves 4x over, great investment. Those profits went to expand the Bitcoin business, is a very high profit margin business, about 80%, 90%. And -- after the merge, we sold those AMDs, but we kept the 38, 000 NVIDIA data center grade GPUs -- and those are the cards that have the capacity for doing HPC and AI computing. And so now we're embarking on this very exciting journey, which I'm going to dive into on our AI infrastructure now. This data center that you see. It doesn't look like a crypt-owned mine, it looks like a data center. It looks like a Tier 3 data center. And that's our -- this is not a stock photo, that's [indiscernible] -- in our facility in Boden, Sweden. And so we have 6 years of history operating GPU, so we have some of the best experts on the planet to run large fleets of GPUs. I mean a lot of people mind ethereum doing retail grade very small quantities. HIVE had 1 of the largest ethereum mines in the world. And so all of that expertise is now being funneled into our AI infrastructure business. It's super exciting. Next slide. So this is a section on our AI outlook. So let's jump into the next slide. You will notice that we rebranded HIVE digital technologies, of course. And so AI and cryptocurrency are pillars of Web 3. And you've heard about the Metaverse and Dow. These are all technologies that have been developed and communities and researchers and developers have been making contributions. But Web 3 will be an adaptive web where Web 2 is a semantic web. Web 2 relied on a lot of Metadata, a few big Internet companies, owning your information, web 3 will be more trustless and permissionless, which is allowed through blockchain technology, crypto can be the Internet native currency of that. And AI will be a big part of that as well. So it will be a more adaptive web. Next slide. So we're this HIVE fit in. Well, first of all, it's pretty well renowned now. There's a large amount of processing power needed for AI applications, specifically large language models. I'm going to get to that in a second. Additionally, There's security concerns about data if you're uploading to a public GPT like opening as ChatGPT. And so companies are not able to upload client data or their own sensitive data because open AI will own it. It's kind of like uploading a photo to Facebook in 2012. Guess what? Now Mark