CANGO Group (Stock Code: CANG) has released the Q2 2025 Financial Report Highlights, with strong revenue and profit performance. The book loss from two one-time accounting adjustments is non-operational and does not reflect actual business losses, as the company remains focused on the high-value "AI Hashrate and Energy Synergy" scenario.
 

1. Core Financial Indicators: Strong Revenue and Profit Performance

1. Bitcoin as the Company's Core Business: In Q2 2025, the company achieved a total revenue of 1 billion RMB, with Bitcoin mining business contributing 989 million RMB, accounting for over 98% of the total revenue. After a 9-month transformation period, CANGO has become one of the world's second-largest mining companies in terms of hashrate.

2. Profit Level Demonstrates Business Resilience: The Adjusted EBITDA reached 710 million RMB, effectively excluding non-operational factors to reflect the true profit capability and operational health of the Bitcoin mining business.

3. Cost Control Establishes Competitive Advantage: Comprehensive cost control was at $98,636 this quarter, demonstrating a significant cost advantage compared to similar companies in the industry, providing solid support for continued profitability and risk mitigation.

4. Financial Reserves Support Strategic Advancements: As of the end of the reporting period, the company held $118 million in cash and cash equivalents, providing ample liquidity reserves for future business expansion, strategic investments, and market volatility management.

2. Key Events of the Quarter: Hashrate Breakthrough and Infrastructure Upgrades

1. Hashrate Scaling to Industry-leading Levels: Successfully reaching a hashrate of 50 EH/s this quarter, as of June 30, 2025, this hashrate accounted for approximately 6% of the global Bitcoin network's total hashrate, marking a key breakthrough in the company's core production capacity and further solidifying its industry position.

2. Strategic Acquisition to Optimize Operational Footprint: Completed the acquisition of a 50MW mining facility in Georgia, USA in August. This acquisition not only effectively reduced electricity procurement costs and improved operational stability but also acquired a core infrastructure supporting future business growth, laying the foundation for further hashrate expansion.

III. Core Model Interpretation: Three Major Competitive Advantages of the "Light Asset Model"

The company adheres to a light asset operating strategy with a core focus on "priority strategic procurement of on-shelf second-hand miners," achieving rapid and cost-effective expansion and scaling of mining power. The core advantages of this model can be demonstrated from three perspectives:

(1) Cost Advantage: Mining Cost Below Market Price, Creating Excess Value for Investors

Through refined operations, the company controls the comprehensive cost of mining one Bitcoin at approximately RMB 98,000, significantly lower than the current Bitcoin market price, ensuring a stable business profit margin. For investors, purchasing company shares is equivalent to indirectly holding Bitcoin-related assets at a cost below market price. This cost advantage is supported by actual operational data. Compared to directly purchasing Bitcoin on the secondary market, it offers higher cost-effectiveness.

(2) Leverage Advantage: "Double Leverage" Amplifying Returns, Aligning with High Elasticity Demand

In business operations, a dual leverage system of "Mining Power Leverage + Operational Leverage" is constructed: on the one hand, through financing methods such as Bitcoin-collateralized medium to long-term loans to expand mining power, achieving "Mining Power Leverage"; on the other hand, in daily operations, by optimizing debt reasonably to enhance capital efficiency, achieving "Operational Leverage." This double leverage effect is superior to directly purchasing Bitcoin or Bitcoin ETFs, maximizing the elasticity of returns from Bitcoin price increases and better meeting the needs of investors seeking high returns.

(3) Asset and Equity Advantage: Efficient Operation to Protect Shareholder Rights, Mitigating Dilution Risks

Compared to similar companies in the industry (such as MARA), while maintaining an equivalent mining power scale of 50 EH/s, the company demonstrates superior net asset and operational asset allocation efficiency and does not need to cover operating expenses through "frequent stock issuance." Some peers, due to weaker cost control capabilities, rely on issuing additional shares to ease financial pressure, resulting in significant dilution of shareholder equity. The company's operating model can effectively protect shareholder interests, avoiding weakening investor actual returns due to equity dilution.

IV. Net Loss Explanation: One-time Accounting Adjustments, Non-operational Substantial Loss

The net loss shown in this quarter's financial report is mainly due to two one-time accounting adjustments. These adjustments temporarily reduce the reported profit but lay a solid foundation for future business expansion. They represent strategic investments in long-term growth rather than actual operational losses.

The specific reasons are as follows:

1. 18E Miner Delivery Resulting in Non-cash Loss: The pricing of this miner transaction has been locked in until October 2024, with an implied share issuance price of approximately $2 per ADS; as of June 30, 2025, the company's share price has nearly doubled, based on the current fair value.

Upon reassessment, a book loss was recognized, with this portion of the loss reflected in the income statement under the "Mining Machine Impairment Loss" account.

2. One-time Loss from Disposal of China Assets: During the asset disposal process, the fair value of the related assets was assessed by a third-party professional appraisal institution to be lower than the original book value, resulting in a one-time impairment loss. This loss is reflected in the income statement under the "Net Investment Income" account as - $80.89 million.

Five, Future Strategic Direction: Transition from "Single Mining" to "Energy + HPC" Integrated Platform

The company will advance its strategic transformation in stages, gradually shifting from a pure Bitcoin mining business to an "Energy + HPC (High-Performance Computing)" integrated service platform. In the short term (next few quarters), it will focus on the following three key actions while also laying the groundwork for long-term HPC

business:

(I) Short-Term Core Actions: Strengthening Foundations, Optimizing Operations

1. Maximizing the Value of Existing Hashrate Assets: Fully unleash the capacity potential of the 50 EH/s hashrate cluster by improving operational refinement and advancing strategies such as phased deployment of advanced mining machines to continuously optimize output efficiency.

2. Deepening Cost Control Advantage: Prioritize "Core Cost Reduction" as a key focus area, actively promote the acquisition of low electricity price mining farms to further compress power costs, and solidify industry cost competitiveness.

3. Expanding Green Energy and Energy Storage Business: Continuously enhance the operational capabilities of green energy (green power) and energy storage projects. This step can not only directly reduce the electricity costs of mining operations but also accumulate renewable energy management experience. In the future, through self-use of green power or external

sales, diversified income can be generated.

(II) Long-Term Strategic Layout: Entry into the HPC Field, Exploring New Growth Trajectories

Built on the foundation of short-term business, the company targets high-value scenarios of "AI Computing Power and Energy Collaboration." It has initiated an HPC pilot project plan; it is expected that specific pilot projects will be launched in the first half of 2026, marking a substantive advancement in the company's transformation towards an "Energy + HPC" integrated platform.

This article is contributed content and does not represent the views of BlockBeats.

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