Shares of cryptocurrency mining company Canaan Inc. (NASDAQ:CAN) tumbled 9.86% during premarket trading on Tuesday.
The drop followed first-quarter financial results that fell short of analyst projections and a second-quarter outlook that missed expectations.
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The company recorded an adjusted loss of $0.86 per ADS for the first quarter.
This missed the consensus analyst estimate of a $0.03 loss by $0.83.
Quarterly revenue reached $62.7 million, representing a 24% decline compared to the $82.8 million reported in the same period last year.
However, it aligned with the company's previous projections.
Weak Second-Quarter Guidance
For the second quarter of 2026, Canaan projected its revenue to fall between $35 million and $45 million.
The midpoint of this guidance sits at $40 million, falling significantly short of Wall Street expectations, which had anticipated $98.15 million.
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The company noted that the downbeat revenue outlook stems from near-term market conditions and evolving customer dynamics.
During the first quarter, Canaan successfully mined 257 bitcoins.
It expanded its digital asset reserves to a record 1,807.60 BTC and 3,951.53 ETH as of March 31, 2026.
The total installed computing power across Canaan's 10 joint-mining operations expanded to approximately 11 EH/s.
This performance reflects a sequential growth rate of 10.7% for the mining hardware manufacturer.
"Despite bitcoin price volatility, compressed hashprice conditions, elevated energy costs, and weather-related disruptions in North America, we delivered total revenue of $62.7 million, which was in line with our guidance," said Nangeng Zhang, chairman and CEO.
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Widening Losses Amid Operational Expansion
Net losses for Canaan widened to $88.7 million during the quarter.
This compares to a net loss of $86.4 million during the same period in the prior year.
The company's adjusted EBITDA loss also grew significantly, reaching $76.3 million from $38.1 million a year ago.
The increasing financial losses occurred alongside ongoing expansion efforts by the company. Canaan secured a 49% stake in ABC Projects located in West Texas from Cipher Mining.
This move integrated approximately 4.4 EH/s of operational hashrate capacity into its portfolio.
Furthermore, Canaan expanded its geographical footprint by deploying hash-to-heat infrastructure within the Nordic region.
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The specialized facility currently has 2 MW of operational capacity online.
