Canaan's Q1 2025 Mining Revenue Surges 131.9% Amid Tariff Uncertainty

Canaan Inc., a leading player in the cryptocurrency mining industry, reported a significant surge in its mining revenue for the first quarter of 2025. The company's mining revenue grew by 131.9% year-over-year, reaching $24.3 million. This substantial increase in revenue was driven by a 135.9% year-over-year growth in total revenue, which amounted to $82.8 million, surpassing market expectations. However, the company reported a net loss of $1.79 per share, compared to a net loss of $1.06 per share in the same period last year. The total computing power sold by Canaan reached 550 million terahashes per second (TH/s), marking a significant increase from the previous year.

Despite the impressive revenue growth, Canaan has withdrawn its full-year performance guidance due to the impact of tariffs. The company cited the uncertainty surrounding tariff policies as a key factor in its decision to withdraw the guidance. This move reflects the challenges faced by companies operating in the cryptocurrency mining sector, which is highly sensitive to regulatory changes and market volatility. The withdrawal of the full-year performance guidance underscores the need for companies in the cryptocurrency mining industry to remain agile and adaptable in the face of changing market conditions. The impact of tariffs on the industry is a growing concern, as it can significantly affect the cost of equipment and the overall profitability of mining operations. Canaan's decision to withdraw its guidance is a prudent move, given the current uncertainty in the market.

The company's strong revenue growth in the first quarter is a testament to its ability to capitalize on the growing demand for cryptocurrency mining services. However, the net loss reported by the company highlights the challenges it faces in achieving profitability. The withdrawal of the full-year performance guidance is a reminder of the need for companies in the industry to remain vigilant and adaptable in the face of changing market conditions. The company's mining costs for the first quarter of 2025 were $22.9 million, up from $14.9 million in the previous quarter and $12.2 million in the same period last year. These costs include direct production expenses such as electricity and hosting fees, as well as depreciation of deployed mining rigs. The company's gross profit for the quarter was $600,000, a significant improvement from a gross loss of $37.3 million in the same period last year. As of March 31, 2025, the company had $96.8 million in cash, up slightly from $96.5 million at the end of the previous quarter.

For the second quarter of 2025, Canaan currently expects total revenue to be around $100 million. This projection comes amidst the backdrop of recent tariff measures implemented by the U.S. government, which have introduced significant uncertainty into the bitcoin mining industry. These measures have affected the operational plans of mining companies in the region, prompting Canaan to withdraw its previous full-year revenue guidance. The company's decision to provide a quarterly outlook instead of an annual one reflects its cautious approach to navigating the current market environment. Despite the challenges posed by tariffs and regulatory changes, Canaan's first-quarter performance demonstrates its ability to leverage increased mining power and higher bitcoin prices to drive revenue growth. The company's focus on adaptability and agility will be crucial as it continues to operate in a rapidly evolving industry.