Bitcoin mining rig manufacturer Canaan posted net loss, CEO cites Covid-19 and BTC halving 

Canaan Inc, a leading Chinese Bitcoin mining hardware manufacturer published its unaudited second quarter (2020) financial results. As per the report, the company’s gross profit increased year over year and quarter over quarter, but Canaan still suffered a net loss. 

However, the firm’s gross margin expanded significantly last year as well as in the first quarter of 2020. Further, the total computing power sold through Canaan’s Application Specific Integrated Circuit (ASIC) processors was 2.6 million Thash/s. This indicated an increase of approximately 198.5% in the first quarter of 2020 from 0.9 million THash/s, but it also represented an 18.2% decrease in figures from the same period last year.

Moreover, Canaan’s total net revenues increased by 161% in the last quarter but decreased to RMB 178.1 million ($25.2 million). But, the firm’s gross profit of RMB 43.3 million ($6.1 million) went up by 300% year on year, and was up around 1,700% on first-quarter figures. It was followed by a 25% increase in gross margin for the quarter from the gross margin that was 3.5% in the previous quarter and 4.5% in the second quarter in 2019. 

This resulted in a net loss of RMB 16 million ($2.3 million) in comparison with the net loss posted in the same quarter of 2019. Additionally, Chairman and Chief Executive Officer of Canaan, Nangeng Zhang, said: 

During the second quarter of 2020, the COVID-19 pandemic continued to impact the lives of people around the world and the Bitcoin halving event also caused significant volatility in Bitcoin price. […] 

Canaan manufactured the ASIC chip under the Avalon brand which was the first bitcoin-mining ASIC sold to retail users. Until then, many miners used graphic cards from their PCs to mine Bitcoin, which was seen as inefficient by most people. The current share price of the firm is $2.1 as of press time.