Bit Digital (BTBT) Plunges 6.47% as Earnings Miss and Strategic Shifts Spur Sell-Off

Bit Digital (BTBT) plunged 6.47% on Thursday, marking its second consecutive day of declines and a 6.93% drop over the past two trading sessions. The stock hit an intraday low not seen since October 2025, with a 7.21% swing during the session. The sell-off reflects investor concerns over the company’s recent strategic moves and financial outlook.

The convertible notes offering announced to fund Ethereum acquisitions and the planned IPO of its subsidiary WhiteFiber have drawn mixed reactions. While the $100 million financing aims to diversify into Ethereum staking, the 11% immediate post-announcement drop in shares signaled skepticism about leverage risks and execution challenges. WhiteFiber’s confidential IPO filing, though highlighting growth ambitions, introduced uncertainty over ownership structure and capital allocation, further weighing on sentiment.

Financial performance added to the pressure. A Q1 2025 earnings miss, with a $0.32 loss per share versus an estimated $0.03 deficit, underscored profitability struggles. Bitcoin mining revenue fell 64% year-over-year, contributing to a 17% quarterly revenue decline. Analysts project continued losses amid a negative net margin of 52.86% and a cash burn rate that raises questions about funding for Ethereum staking infrastructure and cloud expansion.

Strategic shifts toward Ethereum staking and AI-driven cloud services, while aligning with long-term trends, introduced short-term volatility. The pivot from Bitcoin mining to staking has created uncertainty for investors, compounded by regulatory risks in the crypto sector. WhiteFiber’s 84% cloud revenue growth in Q1 2025 partially offset mining declines, but high capital expenditures for AI data centers remain a near-term drag on profitability.

Broad market dynamics also played a role. Stagnant Bitcoin prices and macroeconomic risks, including U.S. credit rating concerns, amplified sector-wide jitters. Bit Digital’s high beta of 4.77 made it particularly sensitive to these pressures. Despite a “Buy” analyst rating, institutional ownership of 47.7% means any further underperformance could trigger sell-offs, as seen in the recent 8% drop following strategic announcements.

The stock’s trajectory hinges on execution risks: balancing Ethereum staking expansion with liquidity constraints, navigating regulatory scrutiny, and delivering on WhiteFiber’s IPO timeline without diluting shareholder value. Until these initiatives show measurable progress, the stock remains a speculative bet tied to macroeconomic conditions and sector volatility.