Canaan pivots to buybacks and crypto sales as miner hardware demand evaporates Nasdaq-listed Bitcoin miner and hardware maker Canaan announced on Nov. 10 a new $20 million initial share buyback, part of a broader $100 million repurchase authorization its board approved on Nov. 6, 2026. The repurchase program runs for 12 months but the company has not committed to spending the full $100 million; management said timing and amounts will depend on market conditions, operating needs and other financial obligations. Why the buyback now Canaan’s hardware business has slumped dramatically: third-quarter mining-machine revenue collapsed to $4.8 million from $118.6 million a year earlier — a roughly 96% drop. Weak demand and lower average selling prices left the company selling about 1 million terahashes per second of computing equipment during the quarter. Shares have tumbled roughly 75% year-to-date through Nov. 11, and CEO Nangeng Zhang argued the stock is materially undervalued. “This new share repurchase program reflects our belief that our shares are trading at levels that materially undervalue the strength of our business model and long-term growth potential,” Zhang said, adding Canaan will buy back shares more aggressively as liquidity allows while maintaining funds for operations and infrastructure projects. How the buybacks will be funded Canaan said it will fund repurchases with cash and other available liquidity and may also sell cryptocurrency to support purchases. The company can repurchase American depositary shares (ADS) or Class A ordinary shares through open-market purchases, private transactions or block trades. This isn’t Canaan’s first use of crypto sales to finance repurchases. In September the company disclosed selling 3,952 ETH and 54.5 BTC for roughly $13.9 million; $5.4 million of that was used in late August to buy back 13.6 million ADS. By Oct. 15, 2026, the company had repurchased about 16.4 million shares for the year. Balance sheet and crypto holdings As of Sept. 30, Canaan reported: - 1,875.5 BTC on the books, but most tied to financing arrangements: 1,258 BTC pledged as collateral for secured loans and 100 BTC in a fixed-term product. - 517.5 BTC listed directly as cryptocurrency assets, valued at $43.7 million. - $72.8 million in cash and restricted cash; about $50 million of that is supporting a letter of credit for infrastructure commitments, leaving ~$22.8 million unrestricted. Earnings snapshot Despite the collapse in hardware sales, Canaan posted a surprising $8 million net profit for the quarter, reversing a $27.7 million loss in the third quarter of 2025. That profit came in the face of a $42.9 million operating loss and was largely driven by roughly $52 million in non-cash gains tied to changes in the value of its crypto holdings and financial derivatives — gains CFO James Jin Cheng noted are separate from the company’s core operating performance. Mining operations and infrastructure plans Canaan’s own mining revenue outpaced equipment sales in the quarter, generating $9.5 million (versus $4.8 million from equipment). Still, mining revenue fell from $30.6 million year-over-year, and total quarterly revenue plunged to $14.5 million from $150.5 million. Operationally, Canaan mined 133 BTC in Q3, including 44 BTC produced in September. The company is also pushing into energy infrastructure to support its mining and compute ambitions. Its proposed 1-GW Duval County project in Texas received conditional classification under ERCOT’s Batch Zero grid connection process, though further studies and approvals are required. Canaan is also developing a separate 1-GW project in Zapata County that remains in early planning. Corporate housekeeping Canaan plans to change its ADS ratio from one ADS representing 15 ordinary shares to one ADS representing 375 ordinary shares — effectively a 1-for-25 reverse ADS split — expected to take effect around Dec. 4, 2026. Bottom line Canaan’s move to deploy cash and potentially sell crypto for share buybacks highlights a broader recalibration as hardware demand collapses. The firm is leaning on its crypto holdings and infrastructure plans to stabilize shareholder value while it navigates a painful downturn in the mining-equipment market. Read more AI-generated news on: https://app.chaingpt.org/news