Key Takeaways
Bitcoin mining hardware maker Canaan Inc. announced a first-quarter net loss of $88.7 million, as falling Bitcoin prices weakened demand for mining machines and forced a significant inventory write-down. Revenue for the quarter was $62.7 million, a 24.3 percent decrease from the same period a year ago.
"As we completed the final phase of deliveries under our large-scale North American customer order, machine sales generated $42.9 million in revenue during the quarter," Chief Financial Officer James Jin Cheng said. "We also kept machine production costs stable and maintained a competitive all-in power cost of about $0.04/kWh across our mining operations.”
The quarter swung to a gross loss of $22.9 million, a stark reversal from a gross profit of $646,000 in the first quarter of 2025. The loss was driven by a $24.5 million inventory write-down and a $41 million fair-value loss on the company's cryptocurrency holdings, reflecting the decline in Bitcoin's price during the period.
The results highlight the precarious position of hardware manufacturers during a crypto market downturn. With lower Bitcoin prices and weak hash prices, mining profitability shrinks, leading customers to delay capital-intensive purchases of new equipment. In response, Canaan is shifting focus to its own mining operations, acquiring a 49 percent stake in the ABC Projects in West Texas to secure low-cost power and expand its own hash rate.
Canaan sold 4.1 exahash per second (EH/s) of computing power in the quarter, with product revenue falling to $42.9 million from $58.3 million a year earlier. The company’s own mining business generated $19.1 million in revenue, producing 257 bitcoins.
By the end of the quarter, Canaan’s global installed hash rate reached 11 EH/s, up 66 percent year-over-year, largely driven by its expansion in North America. The company's crypto treasury grew to a record 1,807.60 BTC and 3,951.53 ETH as of March 31, 2026.
Looking ahead, Canaan issued cautious guidance for the second quarter, forecasting revenue in the range of $35 million to $45 million. This suggests the company expects the challenging market conditions for mining equipment to persist.
This article is for informational purposes only and does not constitute investment advice.
