Bitcoin Miner Maker Ebang Narrows First Half Loss To $7 Million, as Covid-19 Hit Demand

Ebang International Holdings Inc., the Chinese maker of bitcoin mining hardware, reported a net loss of $6.96 million during the first six months of this year, down from $19.07 million a year ago, as demand fell due to the coronavirus pandemic.

Revenue plunged 51% to $11.04 million from $22.35 million previously, said the company in an earnings release shared with news.Bitcoin.com.

For the half-year, the Nasdaq-listed Ebang sold a total 0.25 million terahash per second (TH/s) of Bitcoin hashpower. The figure represents a year-over-year decline of 86% from 1.82 million TH/s sold in the same period in 2019.

Shares of Ebang rose 0.3% to $9.88 on the Nasdaq Stock Exchange, at the time of writing. The stock has tanked more than 30% since listing on the exchange in June. Then, it traded at a high of $14.95. Ebang reached a low of $3.80 during this period as well.

Dong Hu, chairman and chief executive officer of Ebang, blamed the loss on the Covid-19-induced global economic recession and Bitcoin’s scheduled supply cut of May 11, which cut earnings for miners and reduced demand for mining equipment suppliers. He stated:

Measures to contain covid-19, such as travel restrictions, mandatory quarantines and suspension of business activities have caused severe disruptions and uncertainties to our business operations and adversely affected our results of operations and financial condition. Our chip suppliers have reduced their production capacity due to the impact of the covid-19, resulting in our shortage of raw materials during the first six months of 2020.

For the review period, Ebang, which makes application-specific integrated circuit (ASIC) chips used in bitcoin mining, reported total operating expenses of $7.71 million compared to $9.60 million in the comparable year-ago period.

Bitcoin mining hardware manufacturers have seen a decline in demand due to the coronavirus pandemic. Competitor Canaan Creative reported recently that second-quarter 2020 losses narrowed to $2.4 million from $5.6 million in the previous quarter, but demand also slumped due to Covid-19.

Ebang’s Dong Hu is now hoping to leverage new crypto exchanges and online brokerages that are expected to open soon in Singapore and Canada. He said that the firm intends to “capture the entire value chain of the blockchain industry” through a combination of blockchain-capable financial businesses and conventional ones.