GMO's Cryptocurrency Business Made $2.3 Million Profit in Q2

After a net loss reported in Q1, the Japanese IT giant says it made an 11 percent profit through its crypto business this last quarter.

AccessTimeIconAug 9, 2018 at 9:30 a.m. UTC
Updated Sep 13, 2021 at 8:15 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global event for everything crypto, blockchain and Web3.Register Now

Japanese IT giant GMO has just reported making an operating profit of 255 million yen (about $2.3 million) for its cryptocurrency business in the second quarter of this year.

The firm released its financial report following an earnings call on Thursday, which indicated that the company's crypto segment made a total of 2.6 billion yen, or $23 million, in net revenue.

The amount generated in the crypto segment was almost equally split between the mining and exchange businesses, which accounted for 47 and 53 percent of the net revenue, respectively.

That said, with operating costs mounting to $21 million in just three months, GMO recorded a relatively small margin of $2.3 million, or 10.95 percent. However, the figure looks more respectable when placed in the context of GMO's net loss of $6.6 million in the first quarter – mainly due to negative revenue suffered by its exchange business in the first two months of this year.

Although GMO didn't provide a breakdown of the operating costs for the crypto segment in Q2, it did indicate that a notable portion arises from the mining side of its business.

"Although the expansion and mining equipment progressed as planned and recorded sales of 1.2 billion yen, mining profitability declined due to deterioration of the macro environment such as stagnation of bitcoin price as well as the increase of hash rate," the report said.

Indeed, according to GMO's latest mining report, dated Aug. 3, the firm appears to have increased its mining capacity in the second quarter. For instance, the company mined 512 bitcoins in the first quarter – less than the 528 bitcoins GMO mined in June 2018 alone.

Notably, those figures come soon after the launch of GMO's own 7nm bitcoin miners, which were touted as having higher hashing power alongside lower electricity demands.

Before now, the only previous profitable quarter for GMO's fledgling crypto business was Q4 2017, a time when bitcoin prices soared to a record high of nearly $20,000.

Japanese yen image via Shutterstock

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.