LM Funding America's Q3 2025: Contradictions Emerge on Mining Capacity, Infrastructure Expansion, Miner Deployment, and Bitcoin Mining Costs

Date of Call: November 14, 2025

Financials Results

• Revenue: $2.2M, up ~13% sequentially and 74% year-over-year
• Gross Margin: 49%, improved versus prior quarter

Guidance:

• Bitmain S21 immersion-cooled machines to energize in December, adding ~70 PH and improving efficiency
• Expect a step-change in uptime and Bitcoin per megawatt from immersion and site-control upgrades
• $1.5M public share repurchase authorized for opportunistic buybacks to increase BTC per share
• Potential to expand Mississippi by ~4 MW; continue balancing BTC accumulation, mining investment and buybacks

Business Commentary:

* Bitcoin Treasury Growth and Infrastructure Expansion: - LM Funding America's Bitcoin treasury grew from 0 to 304.5 in Q3, valued at nearly $35 million, with a significant increase in October to 295 Bitcoin. - This growth was driven by the acquisition of a 11-megawatt facility in Mississippi and the repurchase of shares, increasing Bitcoin per share.

• Operational Efficiency and Hash Rate Expansion:
• The company's hash rate expanded by 50% in the build cycle, from 0.48 exahash in June to 0.71 exahash in October.

• This was achieved through owning and controlling power infrastructure, upgrading fleet mix, and integrating the Mississippi site, enhancing operational efficiency.

• Share Repurchase and Capital Allocation:

• LM Funding executed an $8 million private repurchase of 3.3 million shares and 7.3 million warrants and authorized a $1.5 million public share repurchase program.
• These transactions aimed to reduce dilution, simplify the capital structure, and increase Bitcoin per share, aligning shareholder interests.

Sentiment Analysis:

Overall Tone: Positive

• Revenue up ~13% sequentially and 74% YOY; exited quarter with ~304.5 BTC valued at ~$34.7M versus a market cap ~half that amount; executed $8M private repurchase removing warrant overhang and authorized $1.5M public buyback — management emphasizes increasing BTC per share and operational efficiency.

Q&A:

• Question from Matthew Galinko (Maxim Group LLC, Research Division): With your mining infrastructure pretty radically different from where it was entering '25, I'm curious if you could maybe give us some thoughts on how you think about that your path in '26 as far as the Bitcoin mining infrastructure and equipment goes?
  Response: Focus on expanding owned low-cost sites and upgrading equipment (immersion S21s) to drive production and efficiency into 2026.

• Question from Matthew Galinko (Maxim Group LLC, Research Division): So if I could read between the lines there, it sounds like you're not necessarily pursuing or close on any additional site acquisitions or is that something you're still exploring, but just nothing appealing at this point?
  Response: They continuously evaluate site acquisitions but only pursue opportunities with attractive energy tariffs; nothing imminent was disclosed.

• Question from Matthew Galinko (Maxim Group LLC, Research Division): Just with the -- I guess, with the perspective that you have the, I guess, mandate now to maximize your Bitcoin per share, how do you, I guess, think about allocating between mining business and directly acquiring additional Bitcoin?
  Response: Capital allocation is decided on a multi-year pro forma basis; they balance mining investments (to generate cash and potentially be accretive) against direct BTC purchases to maximize BTC per share.

• Question from Sky Moore (HCW): With about 15% of your old machines in storage, as reported in the company's October update, how are you guys managing your fleet of these machines going forward?
  Response: Stored machines are retained for rapid deployment when power becomes available; they prioritize using Mississippi capacity and upgrade fleet over time.

• Question from Sky Moore (HCW): You mentioned more efficient machines being placed at your current sites. Could you guys provide a current cost of mining 1 Bitcoin or perhaps a range of mining 1 Bitcoin?
  Response: Current cash mining cost was roughly $66,000 per BTC this quarter, down from about $70,000 last quarter.

Contradiction Point 1

Mining Capacity and Infrastructure Expansion

It involves differing statements about the mining capacity and infrastructure expansion plans, which are crucial for understanding the company's growth strategy and operational sustainability.

Given the changes in mining infrastructure since early '25, what is the path for Bitcoin mining infrastructure and equipment in '26? - Matthew Galinko (Maxim Group)

2025Q3: The Mississippi acquisition has worked well, and there's room for further growth. The Oklahoma site, with planned immersion machines, will become a long-term mining site due to energy pricing. The strategy includes targeted acquisitions based on energy tariffs and property availability. - Bruce Rodgers(CEO)

How many MW remain available after deploying stored machines for the 7.5 MW in operation? - Michael John Donovan (H.C. Wainwright & Co, LLC, Research Division)

2025Q2: The total capacity is 26 megawatts, with 11.5 planned in Oklahoma and 7 in Mississippi. Miners in storage will be fully utilized across these sites. - Bruce Martin Rodgers(CEO)

Contradiction Point 2

Miner Deployment and Storage Strategy

It highlights inconsistencies in the company's strategy for deploying miners from storage and the planning for new miner purchases, which are vital for understanding the company's operational efficiency and long-term growth plans.

How is the allocation between Bitcoin mining and direct purchases determined under the mandate to maximize Bitcoin per share? - Matthew Galinko (Maxim Group)

2025Q3: There is an additional potential to expand in Mississippi with 4 more megawatts. The company continues to explore new site acquisitions based on energy tariffs and potential properties. - Richard Russell(CRO)

Does the company plan to purchase additional miners, and will you prioritize deploying existing resources or acquire more at this time? - Michael John Donovan (H.C. Wainwright & Co, LLC, Research Division)

2025Q2: The Mississippi transaction isn't complete regarding miners. Additional miners will be acquired to fill out all the capacity. - Bruce Martin Rodgers(CEO)

Contradiction Point 3

Mining Infrastructure and Site Expansion Strategy

It involves the company's strategic direction regarding the expansion of existing mining sites and the acquisition of new sites, which impacts operational and financial planning.

How will Bitcoin mining infrastructure and equipment evolve by 2026, given the changes since early 2025? - Matthew Galinko (Maxim Group)

2025Q3: The strategy includes targeted acquisitions based on energy tariffs and property availability. - Bruce Rodgers(CEO)

Are there any specific geographies targeting 5-20 MW Greenfield or Brownfield projects? Are you still exploring these? - Michael Donovan (H.C. Wainwright)

2025Q1: The geography for future sites is still being explored. - Bruce Rodgers(CEO)

Contradiction Point 4

Cost of Mining per Bitcoin

It involves the cost of mining one Bitcoin, which directly affects the profitability and sustainability of the company's mining operations.

What is the current cost to mine one Bitcoin, or a range? - Sky Moore (HCW)

2025Q3: The current mining cost per Bitcoin is $66,000, down from $70,000 in the previous quarter. This reduction reflects efficiency improvements and operational optimizations. - Richard Russell(CFO)

What is the current cost per Bitcoin? - Michael Donovan (H.C. Wainwright)

2025Q1: The cost of mining a single Bitcoin improved by approximately $3,000. - Richard Russell(CFO)

Contradiction Point 5

Mining Infrastructure and Expansion Strategy

It involves changes in the company's strategy and plans for mining infrastructure expansion, which are crucial for operational growth and cost management.

How has Bitcoin mining infrastructure and equipment evolved since early 2025, and what is their projected trajectory by 2026? - Matthew Galinko (Maxim Group)

2025Q3: The Mississippi acquisition has worked well, and there's room for further growth. The Oklahoma site, with planned immersion machines, will become a long-term mining site due to energy pricing. The strategy includes targeted acquisitions based on energy tariffs and property availability. - Bruce Rodgers(CEO)

Are you still evaluating assets beyond Texas? - Matthew Galinko (Maxim Group)

2024Q4: We're looking at anywhere between 2 and 15 megawatts, focusing on electricity price and contract terms. We're exploring smaller contracts that larger operators may overlook. - Bruce Rodgers(CEO)