BitFuFu (NASDAQ:FUFU) reported a wider first-quarter loss as weaker Bitcoin prices, higher network difficulty and fair value losses on digital assets weighed on results, while management said the company shifted more capacity toward cloud mining and reduced self-mining exposure to preserve liquidity.
On the company’s first-quarter 2026 earnings call, Chairman and CEO Leo Liu said the period was marked by renewed volatility across the Bitcoin mining sector. He noted that Bitcoin rebounded from $87,000 at the end of December 2025 to $96,000 in early January before falling to $63,000 by mid-February.
Cloud Mining Remains Largest Revenue Driver
CFO Calla Zhao said cloud mining solutions generated $57.5 million in revenue during the first quarter, up 7.1% from the prior year and representing 79.1% of total revenue. She said the performance reflected customer engagement and platform reliability during a volatile market.
BitFuFu reported a cloud mining net dollar retention rate of 85.7% for the quarter.
Self-mining revenue fell 35.2% year over year to $11.4 million. Zhao attributed the decline to market conditions and the company’s decision to reduce self-mining exposure and reallocate hash rate toward cloud mining, which management described as having a more predictable margin profile.
Hosting and other services revenue increased to $3.8 million from $0.7 million in the first quarter of 2025. Zhao said the growth was primarily driven by the company’s 2025 mining facility acquisition, which allowed BitFuFu to offer a “buy and host” solution for customers seeking both ownership and operating support.
Costs and Margins Pressured by Market Conditions
Cost of revenue rose 1.8% year over year to $72.3 million, even as revenue declined 6.8%. Zhao said the main factors were higher Bitcoin network difficulty and higher-cost hash rate procured during the fourth quarter of 2025, when Bitcoin prices were higher.
“Those contracts were entered into when Bitcoin prices were higher, and they pressured gross margin as prices moved lower in first quarter,” Zhao said, adding that the company views the pressure as a timing effect rather than a deterioration in underlying operating efficiency.
Management said BitFuFu is working to realign its cost structure by renegotiating contracts, improving procurement timing and locking in more cost-efficient hash rate at current market rates.
Liu also pointed to operational cost controls, including reduced site operating expenses, optimized staffing, consolidated logistics and use of BitFuFuOS to adjust mining operations in response to market conditions. He said the platform allows the company to overclock mining equipment during favorable price periods and underclock during downturns to reduce power use and protect margins.
Net Loss Widens on Digital Asset Valuation Impact
BitFuFu reported a net loss of $35.0 million for the first quarter, compared with a loss of $16.9 million in the same period last year.
Zhao said fair value losses on Bitcoin holdings and digital asset receivables and payables contributed $35.6 million to the quarter’s net loss. Excluding those fair value impacts, adjusted EBITDA would have been approximately positive $1.1 million, she said.
“While our GAAP results were impacted by market-driven fair value changes, the underlying operating performance of the business was solid,” Zhao said.
Balance Sheet and Bitcoin Holdings
As of March 31, 2026, BitFuFu held $141.5 million in cash and digital assets, down from $177.1 million at year-end. Zhao said the decline primarily reflected mark-to-market effects from the lower Bitcoin price.
The company held 1,794 Bitcoin at quarter-end, including 357 Bitcoin pledged as collateral for loans and payables. Management said it continued to manage its Bitcoin treasury strategically to support operations and maintain financial flexibility.
BitFuFu also had $50 million outstanding under its $100 million revolving credit facility at the end of the quarter. Zhao said the company reduced that balance to $5 million after quarter-end, which she said supported the company’s goal of strengthening its balance sheet and preserving financial optionality.
Management Outlines Near-Term Priorities
Looking ahead, Liu said BitFuFu plans to scale deliberately while maintaining a disciplined risk framework. He said the company expects to selectively increase the share of longer-term 360-day hash rate contracts, while short-term agreements will remain the majority of the portfolio.
Liu said the strategy is intended to improve operational stability and reduce rollover risk. He also said total managed hash rate by year-end may remain relatively stable, while the company positions its portfolio for a potential slowdown in network difficulty growth as some major miners shift toward artificial intelligence and high-performance computing.
Management said BitFuFu will continue evaluating opportunities in real-world assets and energy only where they fit the company’s economics and risk profile. Liu also said the company intends to remain disciplined on equity issuance and avoid speculative bets, funding growth through operating cash flow, selective Bitcoin sales and its revolving credit facility.
“First quarter was not about headline numbers,” Liu said in closing remarks. “It was about execution, preserving capital, refining our cost structure, and strengthening the business.”
About BitFuFu (NASDAQ:FUFU)
BitFuFu Inc provides digital asset mining and cloud-mining services in Singapore. It also offers miner rental, and miner hosting and sales services to institutional customers and individual digital asset enthusiasts. The company is based in Singapore, Singapore.
