Canaan Inc. Records Unaudited Third Quarter 2022 Financial Outcomes

BEIJING, Nov. 14, 2022/ PRNewswire/– Canaan Inc. (NASDAQ: CANISTER) (” Canaan” or the “Firm”), a leading high-performance computer services supplier, today revealed its unaudited economic outcomes for the 3 months finished September 30, 2022

3rd Quarter 2022 Operating as well as Economic Emphasizes

Overall calculating power marketed was 3.5 million Thash/s, standing for a reduction of 37.1% from 5.5 million Thash/s in the 2nd quarter of 2022 as well as a reduction of 48.5% from 6.7 million Thash/s in the very same duration of 2021.

Earnings were RMB978.2 million ( US$ 137.5 million), standing for a reduction of 40.8% from RMB1,652.7 million in the 2nd quarter of 2022 as well as a reduction of 25.8% from RMB1,317.6 million in the very same duration of 2021.

Gross revenue was RMB234.2 million ( US$ 32.9 million), standing for a reduction of 74.8% from RMB929.7 million in the 2nd quarter of 2022 as well as a reduction of 68.4% from RMB741.7 million in the very same duration of 2021.

Earnings was RMB61.1 million ( US$ 8.6 million), standing for a reduction of 90.0% from RMB608.9 million in the 2nd quarter of 2022 as well as a reduction of 88.1% from RMB512.5 million in the very same duration of 2021.

Non-GAAP modified earnings was RMB166.3 million ( US$ 23.4 million), standing for a reduction of 75.8% from RMB688.2 million in the 2nd quarter of 2022 as well as a reduction of 71.7% from RMB5875 million in the very same duration of 2021.

Mr. Nangeng Zhang, Chairman as well as President of Canaan, commented, “The bitcoin mining market weakened throughout the 3rd quarter, as the bitcoin rate changed as well as more dipped to around sixteen thousand bucks just recently. The unfavorable market characteristics have actually dramatically impeded bitcoin miners’ profits as well as capital. As miners are compelled to reduce their need for calculating power, we needed to change down our offering rate in feedback. As an outcome of agreement sales that we safeguarded from previous quarters as well as the shipment of these orders, our topline efficiency in the 3rd quarter was within our assumptions, with complete computer power marketed of 3.5 million Thash/s. In late October, we formally launched our brand-new mining equipment collection, AvalonMade 13 Powered by sophisticated ASIC innovation on the next-generation procedure node, the brand-new collection item attains plainly sped up computer power as well as rose power effectiveness. The launch of the brand-new generation item declares our self-confidence in the basic worth of the bitcoin ecological community as well as shows our consistent initiatives in the r & d of supercomputing innovation. As a matter of fact, as component of our continuous initiative to reinforce our r & d capacities, we are broadening our Singapore head office with appealing regional r & d skills to assist sustain our organization on an international range. Furthermore, we have actually broadened our mining organization by using the united state to maximize the allotment of our mining equipments. Among the bearish market, we remain to expand the range of our mining procedure. With raised computer power online for mining, we created mining profits of RMB 62 million for the quarter.”

” Looking ahead, we encounter an extremely hard sector duration as the bitcoin rate is sinking to lows the marketplace has actually not seen in 2 years. Our top priority is to preserve our cash money, decrease our costs, as well as withstand this market decline. With no interest-bearing financial obligation, we will certainly additionally stay sensible as we buy crucial critical locations such as r & d as well as wafer manufacturing ability on sophisticated nodes. Our team believe these initiatives will certainly place us to increase our market share as well as record the chances that are readied to arise when the marketplace recuperates,” Mr. Zhang ended.

Mr. James Jin Cheng, Principal Financial Policeman of Canaan, specified, “We experienced extraordinary stress as a result of the damaged market need in the 3rd quarter, causing a decrease in our topline efficiency. As miners came to be significantly conventional with their computer power implementation as well as acquisitions, we needed to straighten the asking price of our mining equipments. Consequently, we sustained a significant quantity of stock write-down in the 3rd quarter, which, combined with decreased asking price, more heavy on our gross margin. With bitcoin‘s descending trajectory, increasing power costs, as well as miners under boosting cash money stress, market problems are anticipated to maintain degrading in the adhering to 2 quarters. In order to linger via one of the most tough time of the sector as well as plan for recording even more chances when the marketplace recuperates, we are tightening up cash money administration to improve our costs as well as maintain cash money for manufacturing ability. These are tough choices to make however maintaining our cash money inflows is critical in the present atmosphere. We have actually been via several market cycles as well as sustained plenty of obstacles in the past. Currently, with our concentrate on safeguarding our capital as well as protecting our cash money placement, our company believe we will certainly arise from the current headwinds as well.”

3rd Quarter 2022 Financial Outcomes

Earnings in the 3rd quarter of 2022 were RMB978.2 million ( US$ 137.5 million), standing for a reduction of 40.8% from RMB1,652.7 million in the 2nd quarter of 2022 as well as a reduction of 25.8% from RMB1,317.6 million in the very same duration of 2021.

Products profits in the 3rd quarter of 2022 was RMB916.0 million ( US$ 128.8 million), standing for a reduction of 42.8% from RMB1,600.4 million in the 2nd quarter of 2022 as well as a reduction of 30.2% from RMB1,312.0 million in the very same duration of 2021. The decline contrasted to the 2nd quarter of 2022 was primarily as a result of the decline in complete computer power marketed as well as the reduced asking price. The decline contrasted to the 3rd quarter of 2021 was primarily as a result of the decline in complete computer power marketed. In the item profits section, AI profits raised from RMB1.6 million in the 2nd quarter of 2022 to RMB2.4 million ( US$ 0.3 million) in the 3rd quarter of 2022.

Mining profits in the 3rd quarter of 2022 was RMB62.0 million ( US$ 8.7 million), standing for a rise of 19.0% from RMB52.1 million in the 2nd quarter of 2022 as well as a rise of 1,002.7% from RMB5.6 million in the very same duration of 2021. The boosts in mining profits over the 2nd quarter of 2022 as well as the 3rd quarter of 2021 were primarily attributable to the raised computer power released for mining as well as boosted electrical power supply of mining equipments.

Expense of profits in the 3rd quarter of 2022 was RMB744.0 million ( US$ 104.6 million), standing for a rise of 2.9% from RMB722.9 million in the 2nd quarter of 2022 as well as a rise of 29.2% from RMB575.9 million in the very same duration of 2021. The consecutive as well as year-over-year boosts in price of profits were primarily as a result of RMB221.1 million of supplies write-down videotaped in the 3rd quarter of 2022.

Gross revenue in the 3rd quarter of 2022 was RMB2342 million ( US$ 329 million), standing for a reduction of 74.8% from RMB929.7 million in the 2nd quarter of 2022 as well as a reduction of 68.4% from RMB741.7 million in the very same duration of 2021.

Overall business expenses in the 3rd quarter of 2022 were RMB2750 million ( US$ 387 million), standing for a rise of 1.7% from RMB2705 million in the 2nd quarter of 2022 as well as a reduction of 1.2% from RMB278.4 million in the very same duration of 2021.

R & d costs in the 3rd quarter of 2022 were RMB1181 million ( US$ 166 million), standing for a rise of 13.6% from RMB1039 million in the 2nd quarter of 2022 as well as a rise of 27.3% from RMB928 million in the very same duration of 2021. The consecutive as well as year-over-year boosts were mostly attributable to raised personnel prices in technology-related divisions, partly countered by reduced share-based costs. R & d costs in the 3rd quarter of 2022 additionally consisted of share-based settlement costs of RMB14.5 million ( US$ 2.0 million).

Sales as well as advertising costs in the 3rd quarter of 2022 were RMB142 million ( US$ 20 million), standing for a reduction of 32.5% from RMB211 million in the 2nd quarter of 2022 as well as a reduction of 62.1% from RMB376 million in the very same duration of 2021. The consecutive as well as the year-over-year reductions were primarily as a result of reduced personnel prices, partly countered by raised share-based costs. Sales as well as advertising costs in the 3rd quarter of 2022 additionally consisted of share-based settlement costs of RMB5.4 million ( US$ 0.8 million).

General as well as management costs in the 3rd quarter of 2022 were RMB1427 million ( US$ 201 million), standing for a reduction of 1.9% from RMB1454 million in the 2nd quarter of 2022 as well as a reduction of 3.6% from RMB1481 million in the very same duration of 2021. The consecutive decline was primarily as a result of the decline in expert service charge. The year-over-year decline was primarily as a result of reduced share-based settlement costs. General as well as management costs in the 3rd quarter of 2022 additionally consisted of share-based settlement costs of RMB84.9 million ( US$ 11.9 million).

Loss from procedures in the 3rd quarter of 2022 was RMB408 million ( US$ 57 million), contrasted to an earnings from procedures of RMB6593 million in the 2nd quarter of 2022 as well as an earnings from procedures of RMB4633 million in the very same duration of 2021.

Non-GAAP revenue from procedures in the 3rd quarter of 2022 was RMB64.4 million ( US$ 9.1 million), standing for a reduction of 91.6% from RMB763.5 million in the 2nd quarter of 2022 as well as a reduction of 89.0% from RMB583.6 million in the very same duration of 2021. Non-GAAP modified revenue from procedures omits share-based settlement costs. For more info, please describe “Use Non-GAAP Financial Procedures” in this news release.

Problems on cryptocurrency in the 3rd quarter of 2022 was RMB113 million ( US$ 16 million), contrasted to RMB30.0 million in the 2nd quarter of 2022 as well as nil in the very same duration of 2021. The consecutive decline was primarily as a result of the reasonably level Bitcoin rate throughout the 3rd quarter of 2022, while the year-over-year boost was primarily as a result of the reduced Bitcoin rate at the end of the 3rd quarter of 2022 contrasted throughout of the 3rd quarter of 2021.

Forex gains, web in the 3rd quarter of 2022 was RMB101.2 million ( US$ 14.2 million), compared to a gain of RMB114.3 million in the 2nd quarter of 2022 as well as a gain of RMB1.2 million in the very same duration of 2021, specifically. The forex gains was because of the United States buck admiration versus the Renminbi throughout the 3rd quarter of 2022.

Earnings attributable to normal investors in the 3rd quarter of 2022 was RMB611 million ( US$ 86 million), standing for a reduction of 90.0% from RMB6089 million in the 2nd quarter of 2022 as well as a reduction of 88.1% from RMB5125 million in the very same duration of 2021.

Non-GAAP modified earnings in the 3rd quarter of 2022 was RMB1663 million ( US$ 23.4 million), standing for a reduction of 75.8% from RMB6882 million in the 2nd quarter of 2022 as well as a reduction of 71.7% from RMB5875 million in the very same duration of 2021. Non-GAAP modified earnings omits share-based settlement costs as well as transform in reasonable worth of warrant obligation. For more info, please describe “Use Non-GAAP Financial Procedures” in this news release.

International money translation modification, web of zero tax obligation, in the 3rd quarter of 2022 was an earnings of RMB940 million ( US$ 132 million), compared to an earnings of RMB551 million in the 2nd quarter of 2022 as well as RMB5.7 million in the very same duration of 2021, specifically. The boost was because of the United States buck admiration versus the Renminbi throughout the 3rd quarter of 2022.

Fundamental internet revenues per American depositary share (” ADS”) in the 3rd quarter of 2022 was RMB036 ( US$ 0.05). In contrast, standard internet revenues per ADS in the 2nd quarter of 2022 as well as in the very same duration of 2021 were RMB3.53 as well as RMB2.94, specifically. Each ADS stands for 15 of the Firm’s Course An average shares.

Thinned down internet revenues per ADS in the 3rd quarter of 2022 was RMB036 ( US$ 0.05). In contrast, thinned down internet revenues per ADS in the 2nd quarter of 2022 as well as in the very same duration of 2021 were RMB3.53 as well as RMB2.90, specifically. Each ADS stands for 15 of the Firm’s Course An average shares.

Since September 30, 2022, the Firm held cryptocurrency properties that made up 535.48 Bitcoins, with a bring worth of RMB74.1 million ( US$ 10.4 million).

Agreement obligations since September 30, 2022, were RMB2995 million ( US$ 421 million), reducing from RMB1,340.7 million since December 31, 2021, primarily as a result of reduced future orders of Bitcoin mining equipments.

Since September 30, 2022, the Firm had cash money as well as cash money matchings of RMB2,002.7 million ( US$ 2815 million), contrasted to RMB2,684.3 million since December 31, 2021

Shares Exceptional

Since September 30, 2022, the Firm had a total amount of 158,327,979 ADSs superior, each standing for 15 of the Firm’s Course An average shares.

Current Growths

The Launch of Avalon Made A13 Collection of Bitcoin Mining Equipments

On October 24, 2022, the Firm formally launched its brand-new generation of high-performance bitcoin mining equipments, the Avalon Made A13 (” A13″) collection, which will certainly consist of 2 various versions. Version A1346 includes a hash price of 110 Thash/s as well as a power effectiveness of 30J/TH. Version A1366 has a hash price of 130 Thash/s as well as a power effectiveness of 25J/TH. Both brand-new versions show boosted calculating power as well as boosted power effectiveness over precursors.

The Firm’s Share Repurchase Update

On March 16, 2022, the Firm revealed that its board of supervisors licensed a share redeemed program (the “Share Repurchase Program”) under which the Firm might buy as much as US$ 100 million well worth of its superior (i) ADSs, each standing for 15 Course An average shares, and/or (ii) Course An average shares over the following 24 months beginning with March 16, 2022

From August 13, 2022, to November 4, 2022, the Firm made use of around US$ 11.2 million to buy 3.4 million ADSs. Since November 4, 2022, the Firm has actually bought a total amount of 6.2 million ADSs with an accumulated worth of US$ 21.5 million as well as an ordinary repurchase rate of US$ 3.46 per ADS under the Share Repurchase Program.

The At-the-Market (” ATM MACHINE”) Providing

On April 8, 2022, the Firm became part of an at-the-market offering contract (the “Atm Machine Arrangement”), attending to a prospective at-the-market (” ATM MACHINE”) equity offering program, with H.C. Wainwright & & Co., LLC (” HCW”).

The Firm anticipates the atm machine program to be an adaptable system for the Firm to accessibility public resources markets in the future. The timing as well as level of using the atm machine program will certainly go to the discernment of the Firm, offered that the Firm has actually pleased particular commitments stated in the atm machine contracts as well as the atm machine center is appropriately developed.

Company Overview

For the 4th quarter of 2022, the Firm anticipates complete internet profits to be around RMB310 million ( US$ 43.6 million), taking into consideration the tough market problems throughout the sector. This projection shows the Firm’s present as well as initial sights on the marketplace as well as functional problems, which undergo transform.

Teleconference Details

The Firm’s administration group will certainly hold a teleconference at 7:00 A.M. United State Eastern Time on November 14, 2022 (or 8:00 P.M. Beijing Time on the very same day) to talk about the economic outcomes. Information for the teleconference are as complies with:

Occasion Title: Canaan Inc. 3rd Quarter 2022 Profits Teleconference
Enrollment Web Link: https://register.vevent.com/register/BI9e3f73b54ce24104a97a602d1a014193

All individuals have to utilize the web link given over to finish the on the internet enrollment procedure before the teleconference. Upon signing up, each individual will certainly get a collection of individual dial-in numbers as well as a distinct accessibility PIN, which can be made use of to sign up with the teleconference.

A real-time as well as archived webcast of the teleconference will certainly be readily available at the Firm’s capitalist connections web site at investor.canaan-creative. com.

Regarding Canaan Inc.

Developed in 2013, Canaan (NASDAQ: CANISTER), is a modern technology business concentrating on ASIC high-performance computer chip layout, chip r & d, calculating tools manufacturing, as well as software application solutions. The Firm’s vision is “extremely computer is what we do, social enrichment is why we do it.” Canaan has an abundant experience in chip layout as well as structured manufacturing in the ASIC area. In 2013, it launched as well as standardized its initial ASIC Bitcoin mining equipment. In 2018, Canaan launched the globe’s initial 7nm ASIC chip, supplying power reliable computer tools to the cryptocurrency mining sector. In the very same year, Canaan launched the globe’s initial RISC-V design business side AI chip, more using the capacity of ASIC innovation in the area of high-performance computer as well as expert system.

Currency Exchange Rate Details

This statement consists of translations of particular RMB quantities right into united state bucks (” US$”) at defined prices entirely for the ease of the viewers. Unless or else specified, all translations from RMB to US$ were made at the price of RMB7.1135 to US$ 1.00, the midday acquiring price basically on September 30, 2022, in the H. 10 analytical launch of the Federal Book Board. The Firm makes no depiction that the RMB or US$ amounts referred might be exchanged US$ or RMB, probably, at any kind of specific price or in any way.

Safe Harbor Declaration

This statement consists of ahead − looking declarations. These declarations are made under the “risk-free harbor” stipulations of the united state Personal Stocks Lawsuits Reform Act of 1995. These ahead − looking declarations can be determined by terms such as “will,” “anticipates,” “prepares for,” “future,” “means,” “strategies,” “thinks,” “price quotes” as well as comparable declarations. To name a few points, business expectation as well as quotes from administration in this statement, in addition to Canaan Inc.’s critical as well as functional strategies, consist of ahead − looking declarations. Canaan Inc. might additionally make composed or dental ahead − looking declarations in its regular records to the united state Stocks as well as Exchange Payment (” SEC”) on Kinds 20 − F as well as 6 − K, in its yearly record to investors, in news release as well as various other written products as well as in dental declarations made by its police officers, supervisors or staff members to 3rd parties. Declarations that are not historic realities, consisting of declarations regarding Canaan Inc.’s ideas as well as assumptions, are ahead − looking declarations. Onward − looking declarations entail intrinsic dangers as well as unpredictabilities. A variety of aspects might create real outcomes to vary materially from those included in any kind of ahead − looking declaration, consisting of however not restricted to the following: the Firm’s objectives as well as methods; the Firm’s future organization growth, economic problem as well as outcomes of procedures; the anticipated development of the Bitcoin sector as well as the rate of Bitcoin; the Firm’s assumptions relating to need for as well as market approval of its items, particularly its Bitcoin mining equipments; the Firm’s assumptions relating to keeping as well as enhancing its partnerships with manufacturing companions as well as clients; the Firm’s financial investment strategies as well as methods, variations in the Firm’s quarterly operating outcomes; competitors in its sector in China; as well as appropriate federal government plans as well as guidelines associating with the Firm as well as cryptocurrency Additional info relating to these as well as various other dangers is consisted of in the Firm’s filings with the SEC, including its enrollment declaration on Kind F − 1, as modified, as well as its yearly records on Kind 20 − F, as modified. All info given in this news release as well as in the accessories is since the day of this news release, as well as Canaan Inc. does not carry out any kind of commitment to upgrade any kind of ahead − looking declaration, other than as called for under appropriate regulation.

Use Non-GAAP Financial Procedures

In assessing Canaan’s organization, the Firm utilizes non-GAAP steps, such as modified earnings, as extra steps to evaluate as well as analyze its operating efficiency. The Firm specifies modified earnings as earnings leaving out share-based settlement costs as well as transform in reasonable worth of warrant obligation. The Firm thinks that the non-GAAP economic steps give valuable info regarding the Firm’s outcomes of procedures, improve the general understanding of the Firm’s previous efficiency as well as future potential customers as well as enable higher presence relative to crucial metrics made use of by the Firm’s administration in its economic as well as functional decision-making.

The non-GAAP economic steps are not specified under united state GAAP as well as are absent according to united state GAAP. The non-GAAP economic steps have constraints as logical devices as well as capitalists must rule out them alone, or as an alternative for earnings, capital given by running tasks or various other combined declarations of procedures as well as capital information prepared according to united state GAAP. Among the crucial constraints of utilizing modified earnings is that it does not show every one of the things of revenue as well as cost that impact the Firm’s procedures. Share-based settlement as well as adjustment in reasonable worth of warrant obligation have actually been as well as might remain to be sustained in Canaan’s organization as well as are not mirrored in the discussion of modified earnings. Better, the non-GAAP economic steps might vary from the non-GAAP info made use of by various other firms, consisting of peer firms, as well as for that reason their comparability might be restricted. The Firm minimizes these constraints by fixing up the non-GAAP economic steps to one of the most similar united state GAAP efficiency steps, every one of which must be thought about when assessing the Firm’s efficiency.

Financier Relations Get In Touch With

Canaan Inc.
Ms. Xi Zhang
Email: [email protected]

ICR, LLC.
Robin Yang
Tel: +1 (347) 396-3281
Email: [email protected]

Resource Canaan Inc.