Cipher Mining to offer $150M in convertible notes

NEW YORK - Cipher Mining Inc. (NASDAQ: CIFR), a $1.4 billion market cap company specializing in bitcoin mining and hosting for high-performance computing (HPC), announced today its plans to offer $150 million in convertible senior notes due in 2030, with an additional option for underwriters to purchase up to $22.5 million to cover over-allotments. The offering is subject to market conditions among other factors. According to InvestingPro data, the company generated $152.09 million in revenue over the last twelve months, though it’s currently operating at a loss.

Morgan Stanley is serving as the sole bookrunning manager for the notes offering. These notes, which are senior and unsecured, will accrue interest payable semiannually and will mature on May 15, 2030, unless they are repurchased, redeemed, or converted prior to that date. InvestingPro analysis shows the company currently operates with moderate debt levels, maintaining a debt-to-equity ratio of just 0.08, which provides room for this additional financing. Cipher will have the option to redeem the notes for cash after May 22, 2028, and before the maturity date under certain conditions. Noteholders will have the right to convert their notes under specified circumstances.

The company intends to use the net proceeds from this offering to fund Phase 1 of its Black Pearl data center project. This includes purchasing mining rigs, covering tariffs and shipping costs, and other capital expenditures related to infrastructure. This funding comes at a crucial time, as InvestingPro data indicates the company is quickly burning through cash, with negative free cash flow of $497.8 million in the last twelve months. However, analysts are optimistic, projecting profitability for the company this year. For deeper insights into Cipher Mining’s financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro. On May 16, 2025, Cipher entered into an amendment agreement to update the delivery schedule for these rigs and received a 10% cost reduction for early payment.

Concurrently with the notes offering, Cipher also announced a separate underwritten offering by Morgan Stanley to facilitate hedging transactions for purchasers of the notes. This offering will involve shares of Cipher’s common stock borrowed from third parties and is contingent on the completion of the notes offering.

The offerings are being made pursuant to an effective shelf registration statement filed with the Securities and Exchange Commission (SEC). Potential investors are advised to read the prospectus supplements and accompanying prospectus for more information, available on the SEC’s website or through Morgan Stanley.

Cipher’s forward-looking statements in the press release are subject to various risks and uncertainties, and actual results could differ materially. The company does not undertake any obligation to update these statements. This news article is based on a press release statement.

In other recent news, Cipher Mining posted an unexpected earnings beat for Q1 2025, reporting adjusted earnings per share of $0.02, surpassing the anticipated loss of $0.07 per share. The company’s revenue reached $49 million, although it fell short of the projected $53.34 million. Despite the revenue miss, Cipher Mining’s earnings surprise reflects effective cost management and operational efficiency. H.C. Wainwright maintained a Buy rating for Cipher Mining with a price target of $6.75, following the company’s robust first-quarter results and strategic initiatives. Cipher Mining has entered a joint venture with Fortress to establish high-performance computing and AI data centers at its Barber Lake facility, aiming to secure a significant portion of future HPC economics. The company is also progressing with a 150 MW expansion at Black Pearl, expecting an additional 2.5 EH/s from rigs in inventory to be operational soon. Cipher Mining’s management remains confident in achieving a hash rate of 23 EH/s by the end of the third quarter, despite potential tariffs on new rig deliveries. These developments underscore Cipher Mining’s strategic direction and growth prospects, as noted by H.C. Wainwright.

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