• Bitcoin miner Canaan reported a 82.1% decline in revenue for Q4 2022, amounting to $56.8 million.
• The firm’s net income shifted to a loss of $63.6 million due to inventory write-downs and research and development costs.
• Despite the market downturn, Canaan saw an increase in mining income of 368.2%, amounting to $10.46 million in Q4 2022.
Canaan Reports 82.1% Revenue Decline
Bitcoin miner Canaan reported a 82.1% decline in revenue for Q4 2022, amounting to $56.8 million as per its most recent filing with the United States Securities and Exchange Commission (SEC). The firm’s net income shifted to a loss of $63.6 million due to inventory write-downs and research and development costs associated with the development of the company’s new line of ASICs.
Q1 & Q2 2022 Market Circumstances
In Q1 2022, Canaan reported a decrease in Bitcoin mining computing power sales of 75.8 percent from Q4 2021 due to reduced ASIC costs equating 1.9 million terahashes per second while annual sales dropped by 13.8%, to $634.9 million, as a result of market circumstances in Q1 and Q2 2022.. Now, the company’s assets are $706 million, while its liabilities are $67 million..
Increase In Mining Income
Despite the market downturn Canaan saw an increase in mining income of 368.2%, amounting to $10 .46 million in Q4 2022 according to the company’s CFO Jin Cheng .Chairman & CEO Nangeng Zhang stated that “To mitigate demand risks during the market downturn, we have been diligently improving and developing our mining business”. As such efforts yielded more progress in early 2023 with 3 . 8 EH/s hash rate installed for mining as of the end February accordingly investments were made “in bolstering our production capacity and expanding our mining operations” .
Reduced Capacity To Mitigate Risks
The company is taking steps reduce risks associated with demand including reducing capacity since April 2020 which resulted 36 % lower year over year cost per terahash basis through December 2020 along with this it has developed new models and upgraded existing models ,also expanded its customer base by providing competitive prices for customers who require large orders .