Canaan Sees Strong Revenue Growth, Narrowed Losses

The company said it sold 18% more in supercomputing power during the first quarter.
Belinda ZhouMay 23,2020,06:55

Supercomputing company Canaan Inc. (Nasdaq: CAN) announced a 45% year-over-year revenue growth on Friday,

The Hangzhou-headquartered company said in a statement that its revenue reached $9.6 million, up 45% from one year ago. Its net loss during the first quarter narrowed to $5.6 million, or 24 cents per share, down 35% year-over-year.

Canaan said its revenue growth was mainly fueled by increases in total computing power sold and the average selling price per trillion hashes(Thash). The company saw a sales increase of 18% in its total computing power from 0.7 million Thash/s in the same period of 2019.

The Bitcoin mining machine maker announced a new Bitcoin mining method through its blockchain cloud computing power platform in April. The new product is a SaaS system that allows partners to quickly build a mature cloud computing power platform. 

“We also lowered the barrier for consumers to enter the Bitcoin mining space through a series of SaaS solutions designed to help our clients reduce the costs of maintaining our mining machines,” Nangeng Zhang, the chief executive officer of Canaan, said in the statement on Friday.

Looking ahead, Canaan rejected to comment on the revenue guidance for the second quarter in the statement on the basis of uncertainty from the COVID-19 pandemic and the Bitcoin halving event.

“We further improved the quality of our product offerings and strengthened our value propositions, which allowed us to minimize the impact of the fluctuations in Bitcoin price and related derivatives during the Bitcoin halving,” Zhang added.

Bitcoin was trading at $9161 intraday Friday, rebounding over 80% from below $5000 in mid-March. The price of Bitcoin hit $10,339 at the crest in mid-February then plummeted to $4904 on March 16.

“Blockchain is a good start, but we'll go beyond that," says Zhang. "When a seed grows up to be a big tree, it will bear fruit,” Zhang said in May.

The company also develops artificial intelligence chips, shipping more than 53,000 AI chips and development kits to AI product developers as of September last year. Canaan said it is working under the development strategy of “Blockchain + AI.”

Canaan became the first Chinese supercomputing company to become publicly traded in New York in November 2019 and raised $90 million.

Shares in Canaan were trading at $3.82 per share, down 4% midday Friday.

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