Exclusive: Canaan's 2019 AI revenue is 2.6 million (with 138 pages of detailed full-year financial report)

Canaan Technology released the full text of its audited full-year detailed financial report on the 15th, and disclosed the revenue from artificial intelligence in 2019. Wu said blockchain learned that Canaan Technology, which is transforming to artificial intelligence, had an artificial intelligence revenue of 2.6 million yuan in 2019.

Canaan's AI revenue was 300,000 yuan in 2018, 500,000 yuan in the first half of 2019, about 900,000 yuan in the third quarter, and 1.2 million yuan in the fourth quarter. Although the growth rate is acceptable, it is still a long way from Zhang Nangeng's mid-year goal of AI revenue reaching tens of millions of yuan. According to people familiar with the matter, Canaan's AI business will develop more rapidly in 2020 as some major customers continue to purchase.

(Reply "Financial Report" in the backend of the official account to obtain Canaan's 138-page detailed financial report for the whole year of 2019)

Canaan has received good reviews and recognition from developers because of its adoption of the RISC-V architecture. For reference, "Linux 5.7 will support domestic RISC-V chip K210". The more troublesome thing is that the architecture is still in its early stages and its acceptance is far less than that of ARM.

Artificial intelligence chips have been a hot startup field in the past few years, giving birth to companies such as Cambrian and Horizon Robotics with valuations of billions of dollars. Mining machine manufacturers have also transformed into AI, with Bitmain investing heavily in it, Canaan's Zhang Nangeng also devoting himself to it, and Shenma's Yang Zuoxing also quite interested. Bitmain recently appointed a new AI CEO after Zhan Ketuan was dismissed.

However, it is difficult for AI chips to generate profits on their own, and Cambrian's prospectus also shows huge losses. However, there are also AI companies that have gained good prospects by "selling themselves", such as Israeli AI chip company Habana Labs, which was acquired by Intel for US$2 billion. Chinese FPGA AI chip company DeePhi Technology was acquired by Xilinx for about US$300 million.

Zhang Nangeng said in a conference call:

"In terms of AI business, based on the launch of the K210 product, we have established strategic cooperation with leading domestic customers, such as establishing a joint laboratory with SenseTime, a leading domestic AI algorithm provider; in the field of smart agriculture, we have established strategic cooperation with leading domestic agricultural technology companies to provide intelligent solutions for the agricultural field; we have cooperated with a world-leading soft drink manufacturer to provide smart industrial solutions; we have established initial contact with DJI and UBTECH to explore the integration of AI and STEAM education. In terms of AI products, during the epidemic, we improved our current facial recognition access control system so that it can identify people wearing masks and remind employees who are not wearing masks. At the same time, we have integrated an intelligent attendance system to assist human resource management. Overall, our AI products have developed rapidly in smart door locks, contactless access control and attendance, smart energy consumption management, and smart industry.

Since 2020, the overseas AI market has also made great progress. At present, our AI chips and modules are widely welcomed by North American customers. In Japan, the K210 chip module of Kanzhi has a good developer community foundation, bringing together a group of enthusiasts obsessed with AI technology. The second-generation AI chip product K510 that we plan to launch this year has more functions, and its performance is several times that of the first-generation product and can adapt to more application scenarios. "

Bitcoin output has halved, and competition in the mining industry has intensified. All mining machine manufacturers are thinking about transformation. We also expect Canaan's artificial intelligence business to deliver better results in 2020.

Canaan's 138-page detailed financial report for the whole year of 2019: https://www.sec.gov/Archives/edgar/data/1780652/000156459020016788/can-20f_20191231.htm