CAN - Canaan Q4 loss widens more than forecast as demand for mining machines wanes

2023-03-07 08:26:22 ET

Cannan ( NASDAQ: CAN ) turned in a wider than expected fourth-quarter loss Tuesday as the further slump in bitcoin ( BTC-USD ) prices during the period led to diminished demand for mining machines.

For the first quarter of 2023, the Beijing, China-based company expects total net revenues to be around RMB (US$65M).

Q4 EPS of -RMB2.61 (US-$0.38), vs. average analyst estimate of -RMB1.32, fell from RMB0.27 in Q3 and from RMB6.90 in the year-earlier quarter.

Revenue of RMB391.9M (US$56.8M), exceeding the RMB309.1M consensus, dropped from RMB978.2M in Q3 and from RMB2,184.6M in Q4 2021.

"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," said CFO James Jin Cheng.

Total operating expenses were RMB393.5M compared with RMB275.0M in Q3 and RMB273.7M a year ago.

Impairment on cryptocurrency was RMB11.3M, matching that of Q3 and rising from nil in Q4 2021, mostly due to the declining bitcoin ( BTC-USD ) price during the quarter.

Earlier, Canaan Non-GAAP EPS of -$0.38, revenue of $56.8M .

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