Canaan Inc. Provides Updates on Recent Development and Business Outlook

Rhea-AI Summary

Canaan Inc. (NASDAQ: CAN) reported that its business outlook for Q1 2022 will be adversely affected by delays in delivery logistics due to COVID-19 quarantine measures in certain regions of China. A five-day lockdown was implemented on March 14, 2022, impacting the delivery of pre-ordered mining machines, potentially pushing revenue recognition to Q2 2022. The company is cooperating with local authorities to ensure employee safety and is monitoring the situation closely for future logistics and product deliveries.

Positive

• None.

Negative

• Revenue recognition for Q1 2022 expected to decline due to delivery delays.
• Inventory delivery backlog projected to push orders into Q2 2022.

BEIJING, March 16, 2022 /PRNewswire/ -- Canaan Inc. (NASDAQ: CAN) ("Canaan" or the "Company"), a leading high-performance computing solutions provider, today announced that its business outlook for the first quarter of 2022 is expected to be impacted due to the delay in the delivery logistics as a result of the recent COVID-19 quarantine control in certain regions in China.

Recently, local governments in a number of cities in China had initiated quarantine control mandates due to the recent resurgence of COVID-19 cases. On March 14, 2022, the government implemented a five-day quarantine lock-down for all residents and businesses in the city where the Company's mining machine factory and warehouses are located. The quarantine period may be extended depending on the effectiveness of the containment. This lock-down measure resulted in the logistics suspension for the delivery of the Company's mining machines to clients that have made down payments or fully prepaid for computing power orders. As such, the Company expects that its revenue recognition in the first quarter of 2022 may be adversely affected due to the delay of its inventory delivery. The delivery of these orders is projected to be backlogged to the second quarter of 2022.

The Company is actively cooperating with the local government for pandemic control and has taken measures to ensure the health and safety of its employees in the influenced region. In addition, the Company is closely monitoring the evolvement of the pandemic situation and will resume logistics and product delivery as soon as the condition improves.

About Canaan Inc.

Established in 2013, Canaan (NASDAQ: CAN), is a technology company focusing on ASIC high-performance computing chip design, chip research and development, computing equipment production, and software services. The company's vision is "super computing is what we do, social enrichment is why we do it." Canaan has a rich experience in chip design and streamlined production in the ASIC field. In 2013, it released and mass produced its first ASIC Bitcoin mining machine. In 2018, Canaan released the world's first 7nm ASIC chip, providing energy efficient computing equipment to the cryptocurrency mining industry. In the same year, Canaan released the world's first RISC-V architecture commercial edge AI chip, further harnessing the potential of ASIC technology in the field of high-performance computing and artificial intelligence.

Safe Harbor Statement

This announcement contains forward−looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward−looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as Canaan Inc.'s strategic and operational plans, contain forward−looking statements. Canaan Inc. may also make written or oral forward−looking statements in its periodic reports to the U.S. Securities and Exchange Commission ("SEC") on Forms 20−F and 6−K, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Canaan Inc.'s beliefs and expectations, are forward−looking statements. Forward−looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward−looking statement, including but not limited to the following: the Company's goals and strategies; the Company's future business development, financial condition and results of operations; the expected growth of the Bitcoin industry and the price of Bitcoin; the Company's expectations regarding demand for and market acceptance of its products, especially its Bitcoin mining machines; the Company's expectations regarding maintaining and strengthening its relationships with production partners and customers; the Company's investment plans and strategies, fluctuations in the Company's quarterly operating results; competition in its industry in China; and relevant government policies and regulations relating to the Company and cryptocurrency. Further information regarding these and other risks is included in the Company's filings with the SEC, including its registration statement on Form F−1, as amended, and its annual reports on Form 20−F, as amended. All information provided in this press release and in the attachments is as of the date of this press release, and Canaan Inc. does not undertake any obligation to update any forward−looking statement, except as required under applicable law.

Investor Relations Contact

Canaan Inc.
Ms. Xi Zhang
Email: IR@canaan-creative.com

ICR, LLC
Robin Yang
Tel: +1 (347) 396-3281
Email: canaan.ir@icrinc.com

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SOURCE Canaan Inc.

FAQ

How will COVID-19 affect Canaan Inc.'s (NASDAQ: CAN) Q1 2022 revenue?

Canaan Inc. expects its Q1 2022 revenue to decline due to delays in delivery logistics caused by COVID-19 quarantine measures in China.

When is Canaan Inc. expecting to deliver backlogged orders?

Canaan Inc. anticipates that delivery of backlogged mining machine orders will occur in Q2 2022 due to recent delays.

What actions is Canaan Inc. taking in response to the COVID-19 situation?

Canaan Inc. is actively cooperating with local governments and implementing measures to ensure the health and safety of its employees during the COVID-19 pandemic.