Canaan Funds $20M Buyback as Mining Machine Sales Collapse 96%

Canaan, the Nasdaq-listed Bitcoin mining equipment maker, has launched a $20 million share buyback after its mining-machine revenue fell 96% year over year to $4.8 million in the third quarter. The company said it will fund the repurchases with available cash and may sell more of its cryptocurrency holdings.

The November 10 announcement forms the initial tranche of a $100 million repurchase authorization approved by Canaan's board on November 6. The authorization runs for 12 months, though Canaan has not committed to spending the full amount. The company said it may buy back American depositary shares or Class A ordinary shares through open-market purchases, private transactions or block trades.

Why is Canaan buying back stock now?

The program follows a collapse in Canaan's core hardware business and a roughly 75% decline in its share price this year through November 11, according to market data cited in reports covering the announcement. Chairman and CEO Nangeng Zhang said the buyback reflects management's view that the market has mispriced the company.

"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.

He added that Canaan intends to pursue purchases more actively as additional funds become available, while preserving enough liquidity for operations and infrastructure projects. The decision builds on an August authorization that allowed management to use digital assets to support repurchases under an existing program.

How bad was the third quarter?

The numbers show a sharp contraction across the business:

• Mining equipment revenue fell to $4.8 million from $118.6 million a year earlier, which Canaan attributed to weaker demand and lower average selling prices. The company sold computing equipment representing roughly 1 million terahashes per second during the quarter.
• Revenue from Canaan's own Bitcoin mining operations reached $9.5 million — nearly double its hardware sales — but down from $30.6 million a year ago.
• Total quarterly revenue dropped to $14.5 million from $150.5 million.

Canaan still reported an $8 million net profit, reversing a $27.7 million loss in the third quarter of 2025. The swing came despite a $42.9 million operating loss. Gains from changes in the value of cryptocurrency holdings and financial derivatives contributed approximately $52 million to the result. Chief Financial Officer James Jin Cheng acknowledged those gains were non-cash and separate from the company's underlying operating performance.

How is the buyback being funded?

Canaan has already monetized digital assets to repurchase shares. Its September mining update disclosed the sale of 3,952 ETH and 54.5 BTC, raising approximately $13.9 million. Of that, $5.4 million went to repurchase 13.6 million American depositary shares in late August, bringing total 2026 repurchases to roughly 16.4 million shares by October 15.

Canaan held 1,875.5 BTC as of September 30, but most of the treasury is encumbered. The company pledged 1,258 BTC as collateral for secured loans and placed another 100 BTC into a fixed-term product. Its remaining 517.5 BTC sat on the balance sheet at $43.7 million.

Liquidity outside crypto is thinner. Canaan reported $72.8 million in cash and restricted cash at quarter-end, of which $50 million backed a letter of credit for infrastructure commitments. That leaves approximately $22.8 million unrestricted.

What else is Canaan building?

The company is pushing into energy infrastructure alongside mining and hardware. Its proposed 1-gigawatt project in Duval County, Texas received conditional classification under ERCOT's Batch Zero grid connection process but still requires further studies and approvals. A second proposed 1-gigawatt project in Zapata County remains in early planning.

Mining output is modest: 44 BTC produced in September and 133 BTC across the third quarter. Canaan has also proposed changing its ADS ratio from one ADS representing 15 ordinary shares to one representing 375 — effectively a 1-for-25 reverse ADS split — expected to take effect around December 4, 2026. The split and the buyback together signal a company working to defend its listing economics while its hardware business waits for a demand recovery.