Canaan Inc. Reports Unaudited First Quarter 2026 Financial Results

Revenue of US$62.7 million was in line with guidance; cryptocurrency treasury[1] reached a record 1,807.60 BTC and 3,951.53 ETH as of March 31, 2026 Installed mining computing power across 10 joint-mining projects reached approximately 11 EH/s, up 10.7% sequentially; Produced 257 bitcoins in Q1 Strategic energy infrastructure footprint expanded through the acquisition of 49% interest in ABC Projects in West Texas from Cipher Mining and Nordic hash-to-heat deploymentCanaan Inc. (NASDAQ: CAN) ("Canaan" or the "Company"), an innovator in crypto mining, today announced its unaudited financial results for the three months ended March 31, 2026.First Quarter 2026 Operating and Financial Highlights Metrics Q1 2026 Market-readable takeaways Total revenue US$62.7 million In line with guidance Product revenue US$42.9 million Completed final deliveries under a major U.S. order Mining revenue US$19.1 million Resilient production despite BTC/hashprice volatility BTC produced 257 BTC Continued mining output Crypto treasury 1,807.60 BTC / 3,951.53 ETH Record high treasury Installed mining computing power ~11 EH/s Up 10.7% QoQ All-in power cost ~US$0.04/kWh Competitive mining cost base G&A expense US$15.0 million Down 11% QoQ Subsequent customer cash collections ~US$42 million Liquidity improved after quarter-end ABC Projects 49% interest / ~4.4 EH/s operating hashrate West Texas energy-compute footprint Nordic hash-to-heat Project 8MW planned / 2MW in operation Sustainable compute infrastructure use case Total revenues were US$62.7 million, which was in line with the Company's previous guidance range.Cryptocurrency treasury expanded to 1,807.60 BTC and 3,951.53 ETH by the end of the first quarter of 2026, with 257 bitcoins produced in the quarter.Nangeng Zhang, chairman, and chief executive officer of Canaan, commented, "Q1 2026 was a quarter of disciplined execution and strategic positioning for Canaan. Despite bitcoin price volatility, compressed hashprice conditions, elevated energy costs, and weather-related disruptions in North America, we delivered total revenue of US$62.7 million, which was in line with our guidance, completed the final deliveries under a major U.S. customer order, and continued to advance our global mining deployment. Our installed computing power across ten joint-mining projects reached approximately 11 EH/s, up 10.7% sequentially, and we produced 257 bitcoins during the quarter. At the same time, our cryptocurrency treasury reached a record level of 1,807.60 BTC and 3,951.53 ETH as of March 31, 2026.""We also made important progress in expanding Canaan's energy-compute infrastructure footprint. During the quarter, we acquired a 49% interest in the ABC Projects in West Texas from Cipher Mining, further strengthening our access to large-scale operational power infrastructure, with approximately 4.4 EH/s hashrate in operation at the project level. In parallel, our Nordic hash-to-heat deployment demonstrated another practical use case for our Avalon water-cooling technology by converting computing power into usable heat for local communities. These initiatives reflect our strategy to move closer to power resources, improve deployment flexibility, and build more durable operating advantages across market cycles.""As energy access and thermal management become increasingly important constraints for high-density computing, we believe Canaan is well-positioned at the intersection of ASIC technology, crypto mining operations, and energy-integrated compute infrastructure. We remain focused on disciplined capital allocation, operational resilience, and long-term value creation for our shareholders."Jin "James" Cheng, chief financial officer of Canaan, stated, "In Q1 2026, we demonstrated resilient operational execution amid a challenging industry environment. Total revenues reached US$62.7 million, in line with the guidance we provided in February, despite heightened market uncertainty. As we completed the final phase of deliveries under our large-scale North American customer order, machine sales generated US$42.9 million in revenue during the quarter. On the mining side, we generated US$19.1 million in mining revenue despite severe bitcoin price volatility and weather-related curtailments in North America. Although average bitcoin prices and hashprice declined significantly quarter-over-quarter, our bitcoin production experienced a comparatively smaller decrease, reflecting the resilience of our mining operations and continued hashrate deployment. We also maintained relatively stable machine production costs and maintained a competitive all-in power cost of approximately US$0.04/kWh across our mining operations.""During the quarter, we further strengthened operational efficiency and optimized resource allocation across the organization, resulting in an 11% sequential decline in general and administrative expenses. Exiting the quarter with a relatively lean inventory position following the completion of our landmark order, we gain greater flexibility to navigate near-term market uncertainty. We also maintained solid liquidity at the end of Q1 and subsequently received approximately US$42 million in customer cash collections during Q2. Concurrent with ongoing mining operations and our DAT management, we grew our cryptocurrency treasury to new all-time highs. As we advance our energy-compute integration strategy, our capital allocation priorities remain anchored in operational agility, infrastructure scalability, and the disciplined pursuit of long-term, competitively advantaged energy resources." [1] Defined as the total number of bitcoins and other cryptocurrencies owned by the Company on its Balance Sheet, including any bitcoins receivable, excluding bitcoins that the Company has received as customer deposits. First Quarter 2026 Financial ResultsTotal revenues in the first quarter of 2026 were US$62.7 million, compared to US$196.3 million in the fourth quarter of 2025 and US$82.8 million in the same period of 2025. Total revenues consisted of US$42.9 million in products revenue, US$19.1 million in mining revenue and US$0.7 million in other revenues.Products revenue in the first quarter of 2026 was US$42.9 million, compared to US$164.9 million in the fourth quarter of 2025 and US$58.3 million in the same period of 2025. The sequential decrease was mainly due to the decreased computing power sold and average selling price, resulting from a tightening of overall market demand led by the decline in bitcoin price. The year-over-year decrease was mainly due to the decreased computing power sold.Mining revenue in the first quarter of 2026 was US$19.1 million, compared to US$30.4 million in the fourth quarter of 2025 and US$24.3 million in the same period of 2025. The sequential and year-over-year decreases were mainly due to the decrease in the average bitcoin price, partially offset by the increase in energized mining computing power.Cost of revenues in the first quarter of 2026 was US$85.6 million, compared to US$181.7 million in the fourth quarter of 2025 and US$82.1 million in the same period of 2025.Products costs in the first quarter of 2026 were US$62.4 million, compared to US$143.6 million in the fourth quarter of 2025 and US$59.2 million in the same period of 2025. The sequential decrease was consistent with the decrease in computing power sold. The year-over-year increase was mainly due to the increase in inventory and prepayment write-down and provision for reserve for inventory purchase commitments accrued. The inventory write-down, prepayment write-down and provision for reserve for inventory purchase commitments accrued for this quarter were US$24.5 million, compared to the inventory write-down, prepayment write-down and provision for reserve for inventory purchase commitments amounting to US$13.9 million for the fourth quarter of 2025 and the inventory write-down of US$2.5 million for the same period of 2025. Products costs consist of direct production costs of mining machines, and indirect costs related to production, as well as inventory write-down, prepayment write-down and provision for reserve for inventory purchase commitments.Mining costs in the first quarter of 2026 were US$22.7 million, compared to US$37.0 million in the fourth quarter of 2025 and US$22.9 million in the same period of 2025. Mining costs herein consist of direct production costs of mining operations, including electricity and hosting, as well as depreciation of deployed mining machines. The sequential decrease was mainly due to the decrease in depreciation as a result of asset impairment recognized in the prior quarter and the change in estimated useful life of mining equipment beginning in fiscal year 2026. The year-over-year decrease was mainly due to the increase in deployed computing power for the Company's mining operations. The depreciation in this quarter for deployed mining machines was US$5.8 million, compared to US$12.1 million in the fourth quarter of 2025 and US$6.2 million in the same period of 2025.Gross loss in the first quarter of 2026 was US$22.9 million, compared to a gross profit of US$14.6 million in the fourth quarter of 2025 and a gross profit of US$646 thousand in the same period of 2025.Total operating expenses in the first quarter of 2026 were US$31.4 million, compared to US$38.2 million in the fourth quarter of 2025 and US$38.3 million in the same period of 2025.Research and development expenses in the first quarter of 2026 were US$15.4 million, compared to US$11.5 million in the fourth quarter of 2025 and US$18.9 million in the same period of 2025. The sequential increase was mainly due to an increase of US$4.0 million in research and development expenditure. The year-over-year decrease was mainly due to a decrease of US$3.6 million in staff cost, a decrease of US$1.1 million in share-based compensation expenses, partially offset by an increase of US$1.6 million in research and development expenditure. Research and development expenses in the first quarter of 2026 also included share-based compensation expenses of US$0.7 million.Sales and marketing expenses in the first quarter of 2026 were US$1.2 million, compared to US$1.1 million in the fourth quarter of 2025 and US$2.9 million in the same period of 2025. Sales and marketing expenses remained stable sequentially. The year-over-year decrease was mainly attributable to a decrease of US$1.7 million in staffing cost. Sales and marketing expenses in the first quarter of 2026 also included share-based compensation expenses of US$43 thousand.General and administrative expenses in the first quarter of 2026 were US$15.0 million, compared to US$16.9 million in the fourth quarter of 2025 and US$16.9 million in the same period of 2025. The sequential decrease was mainly due to a decrease of US$2.1 million in staff cost. The year-over-year decrease was mainly due to a decrease of US$1.5 million in share-based compensation expenses. General and administrative expenses in the first quarter of 2026 also included share-based compensation expenses of US$3.8 million.Loss from operations in the first quarter of 2026 was US$54.3 million, compared to US$23.6 million in the fourth quarter of 2025 and US$37.6 million in the same period of 2025.Change in fair value of cryptocurrency and Change in fair value of financial derivatives in the first quarter of 2026 were a loss of US$24.9 million and a loss of US$16.0 million, respectively, compared to a loss of US$21.5 million and a loss of US$22.8 million in the fourth quarter of 2025, and a loss of US$2.3 million and a loss of US$14.1 million in the first quarter of 2025, respectively. The losses were mainly due to the decreased bitcoin price on March 31, 2026, compared to the bitcoin price on December 31, 2025.Foreign exchange losses, net in the first quarter of 2026 were US$4.0 million, compared to a loss of US$2.9 million in the fourth quarter of 2025 and a gain of US$0.8 million in the same period of 2025, respectively.Loss before income tax expense in the first quarter of 2026 was US$88.8 million, compared to US$84.2 million in the fourth quarter of 2025 and US$85.7 million in the same period of 2025.Equity in gains of equity investees in the first quarter of 2026 was US$0.2 million, compared to nil in the fourth quarter of 2025 and nil in the same period of 2025.Net loss in the first quarter of 2026 was US$88.7 million, compared to US$85.0 million in the fourth quarter of 2025 and US$86.4 million in the same period of 2025.Non-GAAP adjusted EBITDA in the first quarter of 2026 was a loss of US$76.3 million, as compared to a loss of US$40.5 million in the fourth quarter of 2025 and a loss of US$38.1 million in the same period of 2025. For further information, please refer to "Use of Non-GAAP Financial Measures" in this press release.Foreign currency translation adjustment, net of nil tax, in the first quarter of 2026 was a gain of US$5.2 million, compared to a gain of US$1.1 million in the fourth quarter of 2025 and a loss of US$1.1 million in the same period of 2025, respectively.Basic and diluted net loss per American depositary share ("ADS") in the first quarter of 2026 were US$0.13. In comparison, basic and diluted net loss per ADS in the fourth quarter of 2025 were US$0.13, while basic and diluted net loss per ADS in the same period of 2025 were US$0.27. Each ADS represents 15 of the Company's Class A ordinary shares.As of March 31, 2026, the Company held Cryptocurrency assets with a fair value of US$66.2 million and Cryptocurrency receivable with an aggregate fair value of US$67.0 million, respectively. Cryptocurrency assets primarily consist of 802.6 bitcoins owned by the Company and 63.4 bitcoins received as customer deposits. Cryptocurrency receivable consists of 905.0 bitcoins pledged for secured term loans and 100.0 bitcoins transferred to a fixed-term product. The classification of cryptocurrency receivable as current assets is consistent with the corresponding secured term loans. As of March 31, 2026, the Company held a total of 1,871.0 bitcoins.As of March 31, 2026, the Company had cash of US$43.5 million, compared to US$80.8 million as of December 31, 2025. The Company has subsequently received approximately US$42 million in customer cash collections in April 2026.Accounts receivable, net as of March 31, 2026, were US$51.6 million, compared to US$19.3 million as of December 31, 2025. Accounts receivable were mainly due to an installment policy implemented for some major customers who meet certain conditions. The Company subsequently collected approximately US$42 million in cash from Accounts receivable in April 2026.Investment in equity investees as of March 31, 2026, was US$14.1 million. The Company uses the equity method of accounting to account for its 49% equity interest in Alborz LLC, Bear LLC, and Chief Mountain LLC (collectively, the "ABC Projects"). Please refer to "Recent Developments - Acquired Cipher Mining's 49% Interest in ABC Projects Totaling ~4.4 EH/s in West Texas".ADSs OutstandingAs of March 31, 2026, the Company had a total of 690,594,191 ADSs outstanding, each representing 15 of the Company's Class A ordinary shares.Recent DevelopmentsSecured Nordic Hash-to-Heat ProjectOn May 19, 2026, Canaan Inc. announced that it had been selected through a competitive bid process to provide hash-to-heat infrastructure for a district heating network in the Nordic region. The project utilizes the Company's Avalon A1566HA hydro-cooled mining units with a total planned deployment capacity of approximately 8 MW. Approximately 2 MW of capacity is currently operating in the region and supplying hot water to local residents, and based on the successful initial deployment, the customer placed a follow-on order in March 2026 for an additional 6 MW of capacity. The Company believes the project further validates its capabilities in hydro-cooling, thermal management and energy-integrated compute infrastructure, while demonstrating the potential for scalable "hash-to-heat" applications in next-generation sustainable energy systems.Acquired Cipher Mining's 49% Interest in ABC Projects Totaling ~4.4 EH/s in West TexasOn February 19, 2026, the Company acquired Cipher Mining Inc.'s (NASDAQ: CIFR) ("Cipher") 49% equity interest in ABC Projects in West Texas, totaling approximately 4.4 EH/s of operational hashrate capacity. The transaction was completed through a non-cash equity issuance, making Cipher a significant shareholder of the Company. The transaction also includes the purchase of 6,840 Avalon® A15Pro mining machines, which further expands the Company's self-mining scale and U.S. power infrastructure footprint. The ABC Projects bring significant experience in demand response and energy arbitrage within the Electrical Reliability Council of Texas ("ERCOT") grid, reinforcing the Company's strategy to enhance grid stabilization and operational flexibility amid rising data center demand.The Share Repurchase Program On December 17, 2025, the Company announced that its board of directors approved the renewal of a share repurchase program authorizing the buyback of up to US$30 million worth of its outstanding ADSs, or Class A ordinary shares, over the next 12 months starting December 12, 2025. Repurchases may be conducted through open-market, privately negotiated transactions, block trades, or any combination thereof, subject to market conditions and regulatory requirements.As of May 19, 2026, the Company had repurchased approximately 2.8 million ADSs in a total consideration of US$2.0 million under the program.Business OutlookFor the second quarter of 2026, the Company expects total revenues to be in the range of US$35 million to US$45 million, reflecting the near-term market conditions and evolving customer dynamics, which are subject to change.The Company will continue to closely monitor the global policy environment and market developments, and may revise or update its outlook as appropriate, based on future clarity and business visibility.Conference Call InformationThe Company's management team will hold a conference call at 8:00 A.M. U.S. Eastern Time on May 19, 2026 (or 8:00 P.M. Singapore Time on the same day) to discuss the financial results. Details for the conference call are as follows: Event Title: Canaan Inc. First Quarter 2026 Earnings Conference Call Registration Link: https://register-conf.media-server.com/register/BI1f5e37bc999743bf93cfa539bc6a031c All participants must use the link provided above to complete the online registration process in advance of the conference call. Upon registering, each participant will receive a set of participant dial-in numbers and a unique access PIN, which can be used to join the conference call.A live and archived webcast of the conference call will be available at the Company's investor relations website at investor.canaan-creative.com.

Canaan Inc. Reports Unaudited First Quarter 2026 Financial Results

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