Canaan launched a $20 million buyback, with mining machine revenue down 96%

Bitcoin mining machine manufacturer Canaan has launched a $20 million stock repurchase plan, which is part of the $100 million repurchase authorization approved by the board on November 6, with a duration of 12 months. Management stated that they will actively promote the repurchase once the funds are in place and may adjust the purchase arrangements based on operational and financing needs. As of Wednesday's close, Canaan's stock price has fallen about 75% this year. CEO Zhang Nengeng stated that while maintaining a long-term digital asset reserve, the company is selectively liquidating cryptocurrency holdings to fund the stock repurchase.

Canaan's revenue from mining machines in the third quarter was $4.8 million, a 96% decrease from $118.6 million in the same period last year, which the company attributed to weakened demand and declining prices. During the same period, self-mining revenue was $9.5 million, nearly double that of mining machine revenue. The company recorded a profit of $8 million for the quarter, but an operating loss of $42.9 million, with profits mainly coming from the revaluation gains of cryptocurrencies and financial derivatives. Previous disclosures indicated that the company had sold 3,952 ETH and 54.5 BTC for approximately $13.9 million and used $5.4 million in late August to repurchase 13.6 million American depositary shares.

As of September 30, Canaan held 1,875.5 BTC, of which 1,258 BTC were pledged for loans, 100 BTC were placed in fixed-term products, and the remaining 517.5 BTC were directly recorded as cryptocurrency assets, valued at $43.7 million at the end of the quarter. The company's total cash and restricted cash amounted to $72.8 million, of which $50 million was used to support letters of credit for infrastructure commitments, leaving approximately $22.8 million outside the restricted balance. Management stated that the current stock price does not adequately reflect the company's business and growth prospects.