Canaan Inc (NASDAQ:CAN) Q4 2019 Earnings Conference Call - Final Transcript

Apr 09, 2020 • 08:00 am ET

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Canaan Inc (NASDAQ:CAN) Q4 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, thank you for [Technical Issue]

Executive
Shaoke Li

Accepted accounting principles in our earnings release and the filings with the SEC.

With that, I will now turn the call over to our Chairman and the CEO, Mr. Nangeng Zhang. Mr. Zhang will deliver his remarks in Chinese and I will provide corresponding English translation. Please go ahead, sir.

Executive
Nangeng Zhang

We have successfully completed our initial public offering in 2019, which has proven to be a pivotal year for both our company and the industry with great regard. For Canaan, our listing on NASDAQ marks a milestone of growth of our company. For our industry, our IPO demonstrated as capital markets recognition on blockchain technology and its confidence in the future growth prospects of the application specific AI chips market. Throughout our IPO, we provided the firsthand and the transparent data on our operations offering the public an opportunity to gain insights into the blockchain technology and as an industry overall.

Going forward, we will continue to foster technology, innovation and expand blockchain applications to further strengthen our foothold in the industry. With regard to our AI business where we put continuous efforts in cultivating the market and exploring customer and the commercial applications scenarios, we believe that our core business lines blockchain application specific AI chips and further growth drivers of IC industry, by constantly improving our chips computing power, optimizing power consumption rate and the manufacturing cost to expand the application scenarios and reducing cost of ownership.

We are well positioned to empower the whole industry from the upstream of the industry chain. Meanwhile, as we continue to grow with the industry, we will generate healthy financial results and create value for our shareholders in return. We believe that the IC industry is one of the few industries that still have significant headroom for growth and the current marketing environment. Canaan as an IC designer is one of the most rapidly growing subsector of the dynamic IC industry.

Today's world is in an era of abundance. The market demand for our device, for diversified business, services and the product is stronger than it ever worse. The first comes from artificial intelligence of things or IoT, customer electronics, various end-user products, electric vehicles and many other areas. Such blooming of product and their service types caused for more and more types of applications specifically IC chips for fulfill and design brings immense market opportunities for our business and secures our first mover advantage in future development.

In terms of our financial results, our total net revenue in the fourth quarter of 2019 which the RMB400 in Q4 and particularly in the second half of the quarter yet maintained the solid performance in October and November, but our revenue declined considerably in December as a result of the significantly increase the outside pressure. Our total net revenue in the fourth quarter of 2019 missed our previous expectations, yet increased significantly year-over-year under the similar market pressure as of 2018 by taking management measures