Though Bitcoin Bull Run, Canaan Reports Miner Losses - Q4 Financial Report.
2021-04-12 | Eddy Morgan
Bitcoin’s bull run since 2020 closeout
wasn't enough
to stop Canaan from incurring a net loss in 2020.
In line with the company’s unaudited financial
report for Q4 last year, the Bitcoin [BTC] miner maker’s net loss for last year was about $33 Mln. However, Canaan’s 2020 net loss is significantly
less than the $148 Mln recorded in 2019.
Indeed, the reduction in net loss for Canaan was
a standard theme across the company’s quarterly performance last year. As reported earlier, significant growth in the
margin of profit on the sale of mining rigs helped
the firm lessen its year-on-year net loss by over 90% in Q2 2020.
As
a part of the report issued today on Monday, Canaan revealed that its 2020 net revenue amounted to about $68.6 Mln - a 66% decline from the revenue figures
within the 2019 financials.
The marked revenue decline also meant Canaan’s year-on-year
gross profit margin took a steep tumble falling from $79 Mln in 2019 to under $6 Mln in 2020.
On the other hand, despite the
drop by net revenue, Canaan revealed that the trend will reverse in 2021, with
the firm forecasting a $61-Mln net revenue target for Q1 2021.
Like other Chinese miners, Canaan’s
cryptocurrency mining inventory is on backorder amid
the continued global semiconductor shortage.
In line with the Canaan CEO Nancheng Zhang,
the number of pre-orders for the firm’s Bitcoin mining hardware will drive revenue growth, explaining:
“Although the outbreak of Coronavirus caused supply chain disruptions and thus negatively impacted our revenues within the fourth quarter of 2020, our market leadership has allowed us to achieve $174 Mln contracted orders with $66 Mln of money advance from customers as of New Year's Eve, 2020, thus laying a solid foundation for substantial revenue growth for 2021.”
At the time of reporting, the stock price of the Nasdaq-listed Canaan is about 50% down from its 2021 high attained a month ago. Despite the drop, Canaan
remains up 179% year-to-date.
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