According to a recent SEC filing, Canaan, a Bitcoin miner and producer of ASIC mining machines, has reported a decrease in Q4 revenue. The new data shows a drop of 82.1% year-over-year, with the total for the quarter falling to $56.8 million.
During that fiscal quarter, Canaan sold mining computing power totaling approximately 1.9 million terahashes per second. The data does not account for reduced ASIC prices, which represent a 75.8% drop from the final quarter of 2021.
On the bright side, Canaan’s reported mining revenue climbed 368.2% year-over-year, reaching $10.46 million. Nangeng Zhang, Canaan’s chairman and the chief executive officer had the following to say:
“To mitigate demand risks during the market downturn, we have been diligently improving and developing our mining business. Our efforts yielded more progress in early 2023 with 3.8 EH/s hash rate installed for mining as of the end of February. Accordingly, we have made decisive investments in bolstering our production capacity and expanding our mining operations to more varied geographic regions that offer advantageous conditions.”
Despite the success seen in its mining department, the firm’s net income showed a $63.6-million loss for Q4, in comparison to profits totaling $182.0 million for the same quarter in 2021. According to Jin Cheng, the company’s chief financial officer, the decrease was attributable to supply write-downs and research expenses associated with its newest fleet of ASIC miners:
“Considering very soft market demand and low selling price, we incurred an additional inventory write-down of RMB205.3 million, which also dampened our gross margin. In conjunction with one-time higher research and development expenses relating to the tape-out for our A13 series, our bottom line suffered losses during the quarter.”
For the year, Canaan’s revenue lessened by 13.8%, falling to $634.9 million, primarily due to improving conditions within the overall industry during Q1 and Q2 of 2022. The company currently holds $706 million in assets and $67 million in liabilities.