Prairie Operating Co. (ticker CRKR), a digital asset mining company, has reported a significant decrease in its cryptocurrency mining revenue during the first quarter of 2023. From Q1 2022 to Q1 2023, the company’s total mining revenue dropped 100%, from $343,055 to $0. This decrease is substantial, as it highlights the struggles that the firm has faced in generating meaningful revenue from digital asset mining operations since June 30, 2022.
The company had a net loss from continuing operations of $971,366 and $3,095,699 for the three months ended March 31, 2023, and 2022. Additionally, its net cash used in operating activities for the same period was $171,738.
Operational Costs and Expenses
In terms of its operational costs and expenses, a decrease of 77% (or $2,695,643) for the three months ended March 31, 2023, compared to the same period in 2022, was mainly due to lower stock-based compensation ($1,752,985), lower cryptocurrency mining costs ($380,037), and lower general and administrative costs ($356,572).
As of March 31, 2023, the company had a working capital deficit of $13,651,514, compared to a working capital deficit of $8,117,516 on December 31, 2022. This represents a decrease of $5,533,998 due to the reclassification of deposits on mining equipment from current assets as of March 31, 2023, a decrease in cash and an increase in accounts payable and accrued expenses.
Management’s Outlook and Future Plans
Despite these setbacks, management believes that the company will have sufficient liquidity to maintain a profitable operation for at least the next 12 months. This confidence comes from the completion of a merger and the related transactions on May 3, 2023, which brought additional proceeds of $17.3 million from the issuance of preferred stock, and a majority of these funds remain within the company after the merger.
With these funds and appropriate plans for the future, Prairie Operating Co. aims to focus its business primarily on digital asset transaction verification services, which require high levels of computing power. This strategic shift will allow the company to continue to adapt and evolve as new challenges and opportunities arise in the ever-changing cryptocurrency market.
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