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Canaan Narrows Q1 Loss to $5.6 Million Amid Weakening Demand for Mining {Hardware}

Bitcoin mining rig producer Canaan Inventive reported a web lack of $5.6 million for the primary quarter of 2020, down from $9.5 million a 12 months earlier.

The Chinese language firm reduce costs of its ASIC-based machines by over 50% in an effort to enhance gross sales, however that wasn’t sufficient to stop the heavy loss. Demand slumped because the coronavirus pandemic, which disrupted the motion of products worldwide, took its toll.

Shares of Canaan fell as a lot as 3.51% to $3.85 on the Nasdaq Inventory Alternate, at Press time. The stock has tanked from a 52-week excessive of $13

For the interval January to March, income climbed 45% to $9.Four million from $6.6 million the earlier 12 months, pushed by a 19% improve in complete computing energy bought.

Based on Canaan’s earnings launch revealed on Friday, the agency bought 0.9 million terahash per second (TH/s) of Bitcoin hashpower, up from 0.7 million TH/s in the identical interval in 2019. This 12 months’s terahash gross sales account for about 1% of the BTC community’s present complete.

Canaan chief government officer Zhang Nangeng instructed analysts in an earnings name that: “The overall market situation since December last year until January had not been too good. So the unit price per TH/s was indeed lower.” He added:

And the logistics in mainland China had principally stopped across the Chinese language new 12 months because of the Covid-19 pandemic. So regardless that bitcoin’s price was at the next level in February and early March, the pandemic largely affected our gross sales.

Within the assessment quarter, analysis and improvement bills rose to $5.9 million from $4.38 million beforehand, stated the agency. Canaan reported cash and cash equivalents of $37.Three million for the March quarter, down from $72.Three million on the finish of December final 12 months.

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“The decrease was mainly due to higher short-term investments as the company invested $24.5 million in short-term investments as of March 31, 2020,” it stated.

Canaan, which has a market value of $603 million, didn’t challenge second-quarter forecasts citing the uncertainty created by the coronavirus and the latest third halving of Bitcoin.

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Picture Credit: Shutterstock, Pixabay, Wiki Commons

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Yuuma Nakamura


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