A：The major challenges faced by Canan Inc in the first quarter of 2026 were the sharp drop in Bitcoin prices and the halving of prices, resulting in a challenging investment climate for miners worldwide. The drop in prices led to a decrease in sales and a focus on inventory control, cash flow management, and order quality due to market pricing pressure.

A：To navigate through the difficult market conditions, Canan Inc took several actions including completing a large order, expanding their mining operations generating positive cash contribution, acquiring ABC Pro Tax, and advancing the development of next-generation products. They also shifted their strategic focus from a pure mining machine business to energy class computing infrastructure.

A：The first quarter 2026 financial results were in line with the previous guidance range, with total revenues of $62.7 million and reaching record highs in mining machine sales.

A：The partnership with KAR contributed to Canan Inc's business expansion by providing customized high-density hash board modules, indicating a shift from processing single standard manners to integrated systems that are modular, maintainable, upgradable, and adaptable to different operating scenarios. This aligns with Canan Inc's long-term trend of demand system engineering, supply chain management, and global project delivery.

A：The status of Canan Inc's channel expansion efforts is focused on home product platform expansion, customer reach, and service system development. Their products have entered various online platforms and the consumer market is different, emphasizing not only hasrate but also noise level, stability, product design, and after-sales service. They are working on product upgrades for several home models set to launch in the second half of the year.

A：The first pillar of their strategy is energy. They have completed the ABC project and are advancing large-scale, more controllable power generation. The approach involves building infrastructure in regions close to key markets with long-term expansion potential, taking into account that energy infrastructure products usually require a long time to develop and operate.

A：The second pillar of their strategy is computing systems. They have experience in invasive design, machine development, large-scale delivery, and real-world management. They plan to make AI computing systems more like scalable, standardized, and economically clear models, similar to mining machines. This process will not happen overnight, but they believe the direction is becoming increasingly clear.

A：The company plans to build strong operations and then gradually integrate new types of computing systems when the timing is right. This way, they aim to benefit from cash contributions and flexible loads while creating opportunities in AI, PCs, and viable and settlement-enabled digital economic networks in the future.

A：The company is continuing to optimize its organization by focusing resources on core products, key projects, and areas that can build long-term competitive advantages. They are introducing AI tools across the company, managing expenses with a strong fixed plan, and improving business responsiveness and solution efficiency to navigate industry cycles effectively.

A：The purpose of purchasing Company A was not the focus, but the key point is that it is on the same size as all shareholders. In the second quarter, they expect total revenues between $35 million and $45 million, based on current market conditions. Global miners are taking a conservative approach due to the investment, innovation, energy crisis, and geopolitical uncertainties.

A：Ken is going through a difficult transition period, but the company is reducing inventory, controlling costs, advancing new products, expanding sales channels, and supporting long-term opportunities in AI and G computing systems. The industry cycle will continue to fluctuate, but they can control their solution, cost structure, products, quality, and long-term direction. They expect to become stronger in the next cycle.

A：The first quarter of 2026 was marked by significant volatility, including a tightening global liquidity and escalating Middle East geopolitical conflicts. Bitcoin price declined and bottomed at around $66,000, affecting the industry's mining economics. Despite these challenges, the company successfully delivered total revenue within the guided range, increased North American sales, secured membership interest in high-quality mining projects, optimized operational efficiency, and built long-term value for shareholders.

A：The company's total revenue in the first quarter was $63 million, which was within the guidance range. Product revenue contributed $43 million, and North American customers contributed over 80% of total product sales. The company sold 4.1x per second computing power at an average price of $10.5 per terahash per second, with the Avalon home series generating $2.7 million. The company's mining business generated $19 million in revenue, maintaining mining activities throughout the market cycle and strengthening their digital assets treasury.

A：Cana's quarterly global cash rate increased from 11.5% to 53.6% in the first quarter of 2026, fully aligned with its strategy of continuously investing in mining operations in North America.

A：As of March 31, 2026, the total market value of Cana's bitcoin holdings was $140 million, having increased from $121 million due to the recent price recovery towards the $77,000 level.

A：Excluding the impact of the non cash inventory write-down, Cana's adjusted gross profit for the first quarter was approximately $1 million, representing a very slight adjusted gross margin.

A：Cana's main components of cash outflow during the quarter included manufacturing and operation (with a focus on global supply chain), procurement payment for future production capacity, and share repurchases. These were partially offset by cash inflows from sales and VAT refunds. The sequential decrease in cash balance reflects Cana's planned capital outlay and collection timing, but the company's liquidity remains healthy as evidenced by cash recovery post-quarter.

A：The Project ABC acquisition was structured as a share-for-asset exchange, where Cana issued approximately 54 million shares with a total fair value of $25 million. This allocation was for an equity investment in a JV comprising Al and Chief Mountain and for 6,848 bitcoin mining units, now recognized as part of PPE (Property, Plant, and Equipment). This approach allowed Cana to secure 100 MW of high-quality North American power infrastructure with electricity costs below 3 per kilowatt without cash outlay.

A：Cana intends to build around energy computing infrastructure and specialize in ASIC design, with mining providing the starting load and AI/PC giving a long-term opportunity. The company aims to use its ASIC strengths to capitalize on the next wave of institutional growth by securing critical infrastructure and optimizing manufacturing operations.

A：The economic benefits of AI mining lie in the ability to utilize power during low use periods or when power pricing is low, which allows for the drop-in of AI mining to maintain high performance and profitability. Additionally, AI mining machines are considered relatively low cost and have a stable, controllable growth which aids in the efficient collaboration between hardware asset owners and computing customers.

A：The company has not disclosed the exact site count, capacity by stage of development, or whether the sites are under exclusivity or in due diligence. However, they confirm that work is progressing quickly and that the target remains the same: to identify sites that can support AI and bitcoin mining with a low power cost and enough control to lead the project themselves.

A：The company is constantly looking for similar assets and larger opportunities in power generation. They are particularly interested in acquiring stakes or projects from previous miners that have high-quality, low-cost power and resilience even during price fluctuations.

A：The future growth for the AvalonHome series is currently under pressure due to policy changes in important markets like China, which imposed restrictions on mining activities. The company is focusing on channel building and product investment for the second half of the year, planning to launch new products and model upgrades to potentially increase revenue. They remain confident in the quality of their products and their market position.

A：There isn't a precise recovery threshold as the market reacts to various factors. However, historically, significant recovery in the Bitcoin mining equipment market has been observed when the hash price (HP) increases above $40 to $45. At the time of the speech, the hash price was climbing slowly but was expected to approach $40. The market may require further time to experience a real recovery.

A：The inventory level of the 815 series is relatively light compared to previous cycles, primarily due to recent high-order deliveries. There is still some inventory of older generation machines which is being lowered by price adjustments to clear inventory within a few months. Production preparation for the next model is complete, and the product performance is strong. The company aims to be prepared for the potential recovery in demand in the second half of the year.

A：While the US remains the primary focus due to its importance in power and AI HPC infrastructure, the company has received orders from European customers and has other potential international customers. Although the international market is showing some strength, near-term focus is still on the US due to its significance in the sector.

A：The relationship with Tether involves collaboration on customized solutions beyond standard machines. The companies have worked on specialized modules and provided software and hardware system-level solutions. There is an expectation to finalize mass production contracts soon, and the partnership is exploring open source opportunities and providing chips to enable third-party system building. The company views Tether as a key manufacturer and aims to make it easy for partners to build their own systems using their open source code and chips.