Bitcoin ASIC manufacturer Canaan saw 82% revenue drop in Q4

Canaan is a Chinese Bitcoin miner and manufacturer of application-specific integrated circuit mining machines. It has reported a decline in revenue for Q4 2022. The company’s revenue decreased by 82.1% year over year to $56.8 million during the quarter. This downfall was due to lower ASIC prices and a decrease in the amount of computing power sold for Bitcoin mining. So, this report is anyhow true that Bitcoin ASIC manufacturer Canaan saw 82% revenue drop in Q4.

Canaan sold 1.9 million Tetahashes per second worth of computing power for Bitcoin mining. Despite the downfall in revenue, Canaan’s mining revenue improved 368.2% year over year to $10.46 million. The CEO and Chairman of Canaan, Nangeng Zhang, attributes this success to the company’s efforts to improve and develop its mining business.

He stated that the company had made decisive investments in bolstering its production capacity and expanding its mining operations to more varied geographic regions with advantageous conditions.

However, Canaan’s net income swung to a 63.6 million loss in Q4 2022 compared to a profit of $182.0 million in Q4 2021. The Chief Financial Officer of Canaan, Jin Cheng, explained that the loss was due to inventory. He writes down and research expenses related to the company’s new ASIC fleet.

The company incurred an additional inventory write-down of RMB205.3 million due to very soft market demand and low selling prices. It also dampened the gross margin. In addition, the company’s bottom line suffered losses due to higher research and development expenses.

For the full year, Canaan’s revenue decreased by 13.8% to $634.9 million. This decrease was mainly due to better industry conditions. However, the company’s total assets increased to $706 million compared to $67 million in total liabilities.

Despite the challenges faced by Canaan in Q4 2022, the company’s CEO remains optimistic. And it is all about the future. He believes the company’s efforts to improve and develop its mining business will continue to yield progress. The company has installed a hash rate of 3.8EH/s for mining operations. The company also has a strong balance sheet, with total assets exceeding total liabilities.

In conclusion, Bitcoin ASIC manufacturer Canaan saw 82% revenue drop in Q4. It decreases the amount of computing power sold for Bitcoin mining. However, the company’s mining revenue improved, and the CEO remains optimistic about the company’s future. Canaan’s strong balance sheet and continued investments in expanding its mining operations.