MARA (MARA) Q3 2026 earnings review
MARA pays off its Bitcoin loans, but lease targets slip
MARA, a Bitcoin miner expanding into artificial intelligence data centers, saw mining revenue drop while paper gains lifted net profit. Revenue fell 35% to $164 million as lower Bitcoin prices outweighed a 5% rise in coins mined. Reported profit reached $632 million only because of an $885 million accounting gain on its coin stash. After the quarter ended, the finance chief sold 13,597 Bitcoin to pay off $750 million of debt.
| Revenue | $164.2M -35% from a year ago |
|---|---|
| Operating loss, excluding crypto paper swings | -$226M -$182M a year ago, by our math |
| Bitcoin holdings after October sales | 20,415 BTC 35,577 BTC at the end of Q2, by our math |
| Data center lease outlook | Cut 2 leases targeted for 2026 could slip into 2027 |
⚖️ Verdict: ⚪ Neutral
The story is unchanged because solving the debt risk came with another delay in signing data center tenants. Paying off the $750 million loan freed 17,477 pledged coins and removed the threat of collateral calls. The bad news: the chief executive warned that its goal of signing two data center leases this year could slip into 2027, leaving only a $79 million cloud deal as proof of the new business.
The question now is whether MARA's power sites can attract large data center tenants on financeable terms. Either waiting secures better lease economics as power gets scarcer, or rival operators lock up the best customers first. Signed lease announcements over the next two quarters will settle it.
🐂 Bull Case
Bitcoin Sales Cleared $750 Million of Pledged Debt
MARA, a Bitcoin miner expanding into data centers, borrowed $750 million against its digital coins in August to help buy the Long Ridge power plant. That loan locked up more than half of its Bitcoin stash as collateral and raised the risk of forced top-ups if coin prices fell. After the third quarter ended, the finance chief sold 13,597 Bitcoin at about $81,039 each, raising $1.1 billion in cash.
The company used $750 million of those proceeds to pay off the Bitcoin-backed loans in full. That payment freed 17,477 pledged coins, "leaving less than 5% of our BTC holdings loaned or pledged" according to the chief executive. Selling coins after prices rose from $64,000 created an estimated $170 million net benefit, the finance chief said, though MARA also sold 3.8 million shares in July.
What to watch: how much cash MARA sets aside for its 2027 convertible bond obligations. Bondholders can force the company to buy back those notes next year, so keeping cash on hand avoids new borrowing.
Power Portfolio Cleared Key Hurdle at Long Ridge
MARA wants to turn its 1.9 gigawatts of power capacity into a 4.8-gigawatt platform for artificial intelligence data centers. After the quarter ended, federal energy regulators approved its purchase of Long Ridge, an Ohio natural gas plant with 485 megawatts of power capacity. The finance chief expects the deal to close by year-end and bring immediate cash flow, "with roughly 70% of its output under long-term contracts".
Separately, Exaion, MARA's majority-owned cloud computing unit in Europe, signed a four-year, $79 million contract with its first US customer. The buyer agreed to pay for the graphics-chip capacity whether it uses the machines or not, which the chief executive called "an early proof point" for the business. However, Exaion's broader $3 billion pipeline consists of "indications of demand and are not yet contracted or committed".
What to watch: the closing statement for Long Ridge in the fourth-quarter report. It will show how much plant debt joins the balance sheet and how much power profit the plant generates.
🐻 Bear Case
Data Center Lease Target Could Slip Into 2027
For three quarters, MARA has promised to sign large data center tenants to long-term leases alongside its partner Starwood. In the first quarter it targeted at least one lease by the end of 2026, and in the second quarter it raised that goal to two. Management frames the delay as discipline, with the chief executive writing that "waiting has improved the terms available to us".
Yet the quarter ended with zero signed data center leases, and management softened its timeline. "While we are targeting signing two leases before year-end, market conditions are fluid and that timing could slip into next year," the chief executive wrote. Meanwhile, MARA posted a $100 million letter of credit after quarter-end for grid studies at its 2-gigawatt Texas site, committing capital before any tenant signs.
What to watch: any signed lease announcement with a named data center tenant before the fourth-quarter report. Another quarter without a contract would leave MARA relying entirely on Bitcoin and gas power sales.
Accounting Gains Masked a Steep Mining Loss
MARA reported $632.1 million in net income and $857.7 million in Adjusted EBITDA, a profit measure that excludes interest, taxes, depreciation, and stock pay. Both numbers look high only because accounting rules include an $885.3 million paper gain from higher Bitcoin prices during the quarter. Revenue fell 35% to $164.2 million because the average price of Bitcoin mined dropped 37% from a year ago.
- Operating loss excluding crypto and derivative paper swings: $226.4 million by our math, wider than $182.2 million a year ago
- Power and hosting costs: 72.8% of revenue, up 25.8 percentage points from a year ago by our math
- Depreciation and overhead (G&A): 91.9% and 46.2% of revenue, up 25.6 and 12.4 percentage points by our math
- Purchased energy cost per Bitcoin at owned sites: $39,674, up 1.1% from a year ago
By our math, stripping out the $885.3 million crypto paper gain leaves Adjusted EBITDA at negative $27.7 million. Unit energy costs crept up, "primarily driven by higher power costs and global network difficulty outpacing our hashrate growth" according to the finance chief, and third-party hosting contracts worth $71.5 million a quarter do not begin expiring until late 2027.
What to watch: purchased energy cost per Bitcoin in the fourth quarter. If network competition keeps rising faster than MARA's computing capacity, mining margins will stay compressed unless coin prices climb.
Risks this quarter didn't answer
Several standing financial, cost, and legal risks received no detailed update in the shareholder letter.
- Overhead cost trend: G&A excluding stock pay and deal costs was $45.4 million by our math, up from $42.4 million last quarter, and the full 10-Q filing will show whether Exaion drove the increase.
- 2027 convertible bond puts: management noted it is monitoring bondholder repayment rights next year, but the 10-Q debt footnotes will show the exact cash liability remaining.
- Legal appeals and international revenue goal: the release did not mention the pending legal appeals or the older goal of getting half of revenue outside the US by 2028.
👓 Other Themes
Board Approved a $500 Million Share Buyback
After the quarter ended, MARA's board approved a programme to buy back up to $500 million of its common stock. Management said the authorization gives it another way to allocate capital alongside debt reduction and data center spending, though it does not obligate the company to buy any specific amount. The digital infrastructure group has not repurchased any shares yet and still has $1.5 billion left on its share-sale programme.
Cautious AI Financing Climate Slows Industry Deals
The chief executive noted that investors and lenders have grown more cautious toward artificial intelligence infrastructure because of local community opposition, higher borrowing costs, and complex tenant credit structures. While compute demand remains strong, lenders and customers now demand permitted power and guaranteed delivery schedules before committing capital. MARA said this stricter financing environment slows down industry deal-making but favors operators that already control energized land.
💲 Other KPIs
Total Bitcoin held fell by 1,565 coins from last quarter and by 18,838 coins from a year ago. MARA mined 2,247 coins during the quarter but sold 3,891 coins at an average price of $75,300. After quarter-end, the company sold another 13,597 coins to pay off debt, leaving about 20,415 coins by our math.
Unrestricted cash more than doubled from $421.3 million last quarter and rose 73% from $547.1 million at the end of 2025. The increase came from borrowing against Bitcoin, selling mined coins, and issuing 3.8 million shares in July. Combined cash and Bitcoin totaled $3.8 billion at quarter-end, up from $2.5 billion in the second quarter.
The diluted share count rose 5.6% from 470.1 million a year ago, while basic shares grew 3.7% to 385.7 million. Because MARA posted a GAAP profit this quarter, potential shares from convertible bonds were counted in the diluted total. The company also resumed selling stock in July, issuing 3.8 million shares after two quarters of zero sales.
🔮 Guidance
Cut. The chief executive still targets signing two tenant leases before year-end, but warned that fluid market conditions could push the signings into 2027. In the first quarter management targeted one or more leases this year, and in the second quarter it aimed for at least two without any caveat. Zero data center leases have been signed across the past three quarters.
Cut. The Ohio natural gas plant is authorized to sell 485 megawatts today and is now expected to reach its full 505-megawatt capacity in the first half of 2027. In the first quarter, management had expected that 20-megawatt expansion to happen in the second half of 2026. The acquisition itself received federal approval and remains on track to close by year-end 2026.
Unchanged. Management reiterated that its largest third-party hosting contracts, which make up about 29% of total energy capacity, will begin expiring in the third quarter of 2027 and end completely in the first quarter of 2028. Exiting those sites will eliminate third-party hosting expenses, which cost $71.5 million this quarter and $210.7 million over the first nine months of 2026.
❓ Key Questions
How much cash remains after Long Ridge closes?
MARA raised $1.1 billion from October Bitcoin sales and spent $750 million to pay off crypto-backed loans. Because those loans were originally taken to fund the Long Ridge purchase, investors need to know how much cash the closing itself will consume before year-end.
Why did MARA issue shares in July before approving buybacks?
The company sold 3.8 million shares under its at-the-market stock programme in July after two quarters without dilution, then authorized a $500 million buyback after quarter-end. Management did not give the July sale price or explain what changed its view on issuing equity.
What are the milestones for the $100 million Texas deposit?
After quarter-end, MARA posted a $100 million letter of credit for grid interconnection studies at its 2-gigawatt Matagorda County site. Management has not disclosed when the state grid operator will finish the study or when purchase payments to the seller begin.
Who is Exaion's $79 million US customer?
Exaion signed a four-year, $79 million graphics-chip contract with its first US buyer on take-or-pay terms. Management did not disclose the customer's credit profile, how much capital MARA must spend to buy the chips, or when the revenue starts.