Canaan Creative, one of the world’s largest digital currency processing hardware manufacturers, has reported significant losses for 2019 after revenues plummeted to less than half the size of the previous year.
The Nasdaq-listed firm, one of the few digital currency hardware companies to be formally listed on a major stock exchange, posted revenues of just $204 million for the year, less than half the corresponding figure for 2018.
Losses in Q4 alone accounted for $115 million towards the total, compared to a $10.6 million operational loss in the same period a year earlier.
The figures come despite a 47.1% increase in the computing power sold by Canaan over the year, up from 7.2 million TH/s to 10.5 million TH/s, showing a decline in profitability through core segments of the business.
Canaan debuted on the Nasdaq exchange back in November 2019, and suffered a rocky start as underwriters Credit Suisse pulled out of the deal at the last minute. By February 2020, its stock price was through the roof, up 80% to hit new single day highs.
Shortly thereafter, prices plummeted to all-time lows, a range they have continued to hover around in the weeks since. The drop off was compounded by a lawsuit raised over the company’s IPO, following accusations of misleading investors during the public offering.
The results come at a difficult time for block reward miners and the businesses that supply them, with the sector being forced to rapidly correct in the run up to the BTC halving scheduled for May.
The halvening will see the block reward diminishing subsidy for mining BTC slashed in half, coupled with an increase in mining difficulty. The event is expected to hit firms like Canaan most acutely as the global demand for processing hardware is expected to decline.
With the latest round of results, it looks like it couldn’t be happening at a worse time for Canaan.
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