1 week ago
Canaan Inc. (CAN), the Singapore-based shaper of bitcoin mining machines, volition upwind down its artificial quality (AI) semiconductor concern to refocus connected its halfway crypto operations.
Despite the increasing inclination of bitcoin miners diversifying their gross done AI-related businesses, gathering AI chips is apt precise competitory and not cost-effective for smaller companies.
Canaan said that its AI unit, which brought successful conscionable astir $900,000 successful gross successful 2024 (versus total revenue of $88.8 million) and accounted for 15% of company-wide operating expenses, failed to align with the firm's semipermanent strategy, the company said connected Monday.
“Doubling down connected our halfway strengths successful crypto infrastructure and bitcoin mining is the astir strategical way forward,” CEO Nangeng Zhang said successful the statement.
Before the move, the institution said it began exploring options for the AI portion arsenic acold backmost arsenic March 2022, including selling it oregon shutting it down entirely. Now, Canaan expects to implicit the phase-out successful the coming months and anticipates a crisp driblet successful costs erstwhile the exit is finalized.
Canaan is champion known for its Avalon mining rigs, 1 of the earliest brands of ASIC (application-specific integrated circuit) miners built for bitcoin. The steadfast went nationalist connected Nasdaq successful 2019 and continues to make mining hardware portion besides expanding into self-mining and user mining products.
The decision, which comes aft years of trying to diversify into borderline computing chips, is hardly a astonishment fixed the caller absorption of miners and mining spot makers connected "American Made" bitcoin aft Trump's U.S. predetermination win.
Recently, Benchmark's Mark Palmer wrote successful his probe that rig maker's shares don't bespeak upside imaginable from the enlargement of the company's self-mining operations, particularly successful the United States.
Canaan's shares were somewhat down connected Monday, portion the broader integer assets and equities markets were mostly positive. The banal fell 71% this year, portion a bitcoin mining ETF, WGMI, declined astir 20%.
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