Canaan, a producer of cryptocurrency mining rigs, has secured preferred share funding worth over $50 million to advance R&D and increase manufacturing volume.
The Nasdaq-listed company stated in a recent filing that it raised funds by issuing and selling up to 125,000 convertible preferred shares to an institutional investor who wished to remain anonymous.
Canaan will use the net revenues to fund general company operations, increase production, and improve its research and development efforts. The company, which goes by the ticker “CAN,” launched its initial public offering (IPO) on the Nasdaq Global Market in 2019.
With the support of the Nov. 21, 2019, IPO, Canaan raised $90 million. But since CAN entered the market, the value of its shares has fallen by 88%, with this year seeing a 41% decline.
Canaan’s third-quarter numbers from the prior year show how difficult its financial performance has been. In sharp contrast to the net income of $6.3 million reported in the same quarter of 2022, the company posted a significant net loss of $80.1 million.
In related news, Canaan’s stock value dropped 6.45% and ended the trading day of January 25 at $1.45. In the month since the beginning, the stock has decreased by 32.87%.
In spite of these obstacles, Canaan is still working on new product development. In late 2023, the firm celebrated its tenth anniversary by introducing two new mining machines.
With an energy consumption rating of less than 20 joules per terahash, one of these devices stands out for its exceptional efficiency, matching or surpassing the capabilities of devices made by rivals Bitmain and Microbt.
Canaan announced earlier this month that it has received orders for over 17,000 bitcoin mining machines from Cipher Mining Inc. and Stronghold Digital Mining Inc.. These two other businesses are listed on the Nasdaq.
