CleanSpark, Inc. (CLSK) - 10-K Summary
Business Context and Reporting Period
Company: CleanSpark, Inc.
Filing Type: Form 10-K (Annual Report)
Reporting Period: Fiscal year ended September 30, 2025
Business Overview: CleanSpark is a data center developer primarily focused on bitcoin mining, with a strategic pivot toward High-Performance Computing (HPC) and Artificial Intelligence (AI) hosting. As of September 30, 2025, the company operated a portfolio of data centers in Georgia, Tennessee, Mississippi, and Wyoming with a total contracted power capacity of approximately 1,027 MW. The company holds no other crypto assets besides bitcoin.
Key Financial Metrics
| Metric ($ in thousands, except per share) | Fiscal 2025 | Fiscal 2024 |
|---|---|---|
| Total Revenue | $766,314 | $378,968 |
| Net Income (Loss) | $364,464 | $(145,777) |
| Adjusted EBITDA | $823,373 | $245,848 |
| Bitcoin Mined (net of fees) | 7,873 BTC | 7,092 BTC |
| Average Bitcoin Price (mined) | $97,337 | $53,434 |
| Operating Hashrate | 45.6 EH/s | 27.6 EH/s |
| Bitcoin Holdings (Fair Value) | $1,189,443 | $431,661 |
| Total Debt (Net) | $821,156 | $65,957 |
| Working Capital | $1,004,276 | $517,543 |
Note: Revenue increased 102% year-over-year, driven by higher bitcoin prices and increased hashrate. Net income turned positive due to a $425.6 million unrealized gain on the fair value of bitcoin holdings.
Material Changes vs. Prior Period
- Profitability: The company transitioned from a net loss of $145.8 million in FY2024 to a net income of $364.5 million in FY2025. This shift was primarily driven by the adoption of ASC 350-60, which requires bitcoin to be measured at fair value, resulting in a $425.6 million gain on fair value of bitcoin.
- Operational Expansion: Hashrate increased from 27.6 EH/s to 45.6 EH/s (a 65% increase), and the number of miners in service grew from 188,500 to 241,934. The company expanded its footprint in Tennessee and Georgia and acquired land and power capacity in Texas for future HPC/AI development.
- Cost Structure: Cost of revenues increased 107% to $343.1 million, largely due to higher energy consumption ($331.3 million) to support the expanded fleet. However, the average cost per kWh decreased slightly to $0.057 from $0.046.
- Debt Profile: Total debt increased significantly to $821.2 million from $66.0 million, following the issuance of $650 million in 2030 Convertible Senior Notes in December 2024 and draws on bitcoin-backed lines of credit.
Guidance, Outlook, and Risks
Strategic Outlook: Management is actively diversifying into AI and HPC hosting. In October 2025, the company acquired land in Austin County, Texas, and secured 285 MW of power for a new data center campus. They are also evaluating partnerships with Submer Technologies for modular AI center design. The company launched an in-house treasury function in April 2025 to manage bitcoin holdings via derivatives (covered calls) to generate liquidity without selling spot bitcoin.
Key Risks and Contingencies:
- Regulatory/Tariff Risk: The company faces a potential tariff liability of approximately $185 million from U.S. Customs and Border Protection (CBP) regarding miners imported in 2024 alleged to be of Chinese origin. The company disputes this and has not recorded a provision.
- Bitcoin Volatility: Financial results are heavily correlated with bitcoin price. A 10% decrease in bitcoin price would reduce the fair value of holdings by approximately $148 million.
- Liquidity and Debt: The company has significant debt obligations, including $650 million in convertible notes due in 2030 and bitcoin-backed lines of credit. While lines of credit were repaid in November 2025 (subsequent event), the company maintains $400 million in borrowing capacity.
- Legal Proceedings: The company is subject to a shareholder class action lawsuit (Hasthantra v. CleanSpark) which was certified in September 2025. The company intends to defend vigorously.
Investor Verification Checklist
- Tariff Liability: Verify the status of the CBP tariff dispute and the potential $185 million exposure on imported mining hardware.
- Bitcoin Accounting: Confirm the impact of ASC 350-60 on net income, noting that the $364 million profit includes significant unrealized gains on bitcoin holdings rather than just operational cash flow.
- Debt Covenants: Review the terms of the 2030 Convertible Notes and bitcoin-backed credit facilities (Coinbase and Two Prime) to understand margin call triggers and conversion risks.
- AI/HPC Execution: Monitor the progress of the Texas data center acquisition and the partnership with Submer Technologies to assess the viability of the diversification strategy.
- Legal Exposure: Track the progress of the certified class action lawsuit and any potential settlement costs.