Crypto miner Canaan just posted its strongest quarterly revenue in three years. However, instead of celebrating, the market focused on the sub-$1 share price and the possible delisting from the Nasdaq stock exchange.
Here’s what you need to know.
Record revenues can’t make the market laugh
Canaan’s latest earnings report delivered numbers the company hasn’t seen in years, with a 121.1% increase in fourth-quarter revenue to $196.3 million.
Source:
The figures were made possible by mining production and a high demand for its machines. Mining revenues alone rose 98.5% year-on-year to $30.4 million.
At the same time, Canaan expanded its reserves of digital assets, ending the quarter with a record 1,750 BTC (worth almost $120 million) and 3,950 ETH worth about $7.9 million.
Source: Canaan
Machine shipments also reached a milestone, reaching a record 14.6 exahashes per second (EH/s) during the quarter. Sales of computing power also increased by 60% compared to a year ago.
Success overshadowed by falling stock prices
Canaan continued to grow its mining footprint in the fourth quarter, expanding installed capacity to 9.91 EH/s, while operating at 7.65 EH/s. Meanwhile, the Bitcoin network hashrate rose from a peak of 1,150 EH/s in mid-October to around 980 EH/s.
And yet operating profits did little to reassure investors. At the time of writing, CAN was trading at $0.57, down 6.87% on the day.
More trouble ahead?
The stock price is now causing a bigger problem. Shares are down about 18% since the beginning of the year; a decline of 70.2% over the past 12 months.
Source: Canaan
On January 16, the Singapore-based miner arrived revealed a Nasdaq warning stating that it no longer met the exchange’s minimum bid requirement. To avoid delisting, Canaan must push the stock’s closing price back above $1 for at least ten consecutive trading days.
The company has 180 days until July 13 to comply with the rule.
Final thoughts
- Canaan posted a 121% increase in revenue, but its sub-$1 share price keeps the risk of delisting from Nasdaq under close watch.
- With a deadline to regain compliance, CAN’s next steps could make or break.