Canaan Creative, the second largest Bitcoin miner manufacturer, has reported a net loss of $5.6 million for the first quarter of 2020 with the falling demand for its devices.
According to the unaudited report published on Friday, the company reported total revenue of $9.4 million for the quarter – 44.6 percent increase in the figures posted for the same quarter a year before.
The dent on the books of the company also involved $9.3 million and $5.9 million in expenses in the cost of goods sold and R&D respectively.
To increase the number of sales of its ASIC-based machines, Canaan also slashed the price of the Bitcoins miners to more than half.
In an earnings call on Friday, Zhang Nangeng, CEO and chairman of Canaan, said: “The overall market situation since December last year until January had not been too good. So the unit price per TH/s was indeed lower.”
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In the reported quarter, the Hangzhou-headquartered company had sold 0.9 million terahashes per second (TH/s) of Bitcoin mining hashrate – less than 1 percent of the total computing power currently generated by the mining operations.
The financials also revealed that the cash and cash equivalent with the company dropped to $37.3 million last quarter from $71 million by the end of December. Canaan pointed out that the drop was primarily due to the higher short-term investment made by the company.
Last month, the Chinese company reported a net loss of $178 million for entire 2019.
Reflection on the market
Canaan’s stocks are listed in the United States stock exchange and the impact of the red numbers is reflected in its market performances. The company’s stocks dropped by more than 5 percent, as of press time, and is trading at around $3.80, compared to the IPO issue price of $9.
The company is also facing a class-action lawsuit by its investors for providing false information about the financial health and operation status of the company in the IPO filings.