Bitcoin mining-equipment manufacturer Canaan reported its second-quarter financial results on Sept. 8, revealing a net loss of $97.6 million alongside revenue that fell below the company's prior guidance range.
Total revenue for the quarter reached $31.9 million, coming in short of the $35 million to $45 million range previously forecast in May. Product revenue dropped to $13.6 million, down from $42.9 million in the first quarter. Canaan attributed the decline to lower selling prices and reduced computing power sold amid weaker market demand.
The company's mining operations generated $17.7 million in revenue during the quarter with the production of 243 BTC. Management stated that these mining operations provided a positive cash contribution before depreciation.
Canaan reported holding 1,915.5 BTC as of June 30. Of that total, 1,117 BTC were pledged for secured term loans and 100 BTC were transferred to a fixed-term product, leaving 698.5 BTC categorized as cryptocurrency assets. The pledged and fixed-term holdings were recorded as cryptocurrency receivables valued at $70.9 million, separate from the $47 million valuation of cryptocurrency assets. Cash holdings stood at $66 million at the end of June, up from $43.5 million at the end of March.
The quarterly net loss included several noncash charges, including $25.3 million in inventory and prepayment write-downs alongside purchase-commitment provisions, as well as $9.2 million in property and equipment impairment.
Following the close of the quarter, Canaan converted a portion of its digital assets into cash. In late August, the company sold 3,952 ETH and 54 BTC, raising approximately $13.9 million. Part of these proceeds was used to fund share repurchases under its existing program. By Sept. 8, repurchases totaled approximately 16.4 million American depositary shares for $7.4 million, which included $5.4 million spent in late August.
Looking ahead, management issued a third-quarter revenue forecast between $11 million and $15 million.
