Canaan BOXmanufacturer of Bitcoin BTC/USD mining equipment, announced lackluster third-quarter financial results after a tough few months for the crypto industry.
According to the Beijing-based company:
- Net profit fell 88% to 61.1 million yuan ($8.6 million) from the same period a year earlier.
- Revenue fell 26% to 978.2 million yuan
- Total computing power sold fell by 48.5% to 3.5 million terahashes per second (the rate of hashes per second determines how long it takes to complete a block).
Canaan isn’t the only bitcoin mining company going through a tough time. calculate northa data center provider, declared bankruptcy in September.
Liquidity problems also affected Argo Blockchain ARBK and Basic scientist CORZ.
“The negative market dynamics have significantly hampered bitcoins miners’ income and cash flow. As miners are forced to reduce their demand for computing power, we had to adjust our sale price in response,” said Canaan CEO. Nangeng Zhang said.
While efforts were being made in the research and development of supercomputing technology, Canaan is facing “a very difficult industrial period as the price of Bitcoin falls to levels the market has not seen for two years”, explained Zhang.
“Our priority is to conserve our cash, minimize our expenses and weather this market downturn,” he added.
The scenario was likely made worse by the collapse of the crypto company FTXwhich was once valued at $32 billion but is now valued at next to nothing after declare bankruptcy last week.
The market situation is expected to continue to deteriorate due to “Bitcoin’s downward trajectory, rising energy prices and miners under increased cash pressure”, according to James Jin Chengfinancial director of Canaan.
Canaan shares last traded at $2.69, according to Data of Benzinga.