Canaan Inc., a Nasdaq-listed chipmaker and the world's second-largest manufacturer of cryptocurrency mining machines, announced on June 23 that it will shut down its artificial intelligence (AI) chip division. The move is part of a broader strategic restructuring aimed at concentrating on core operations such as Bitcoin mining hardware sales, self-mining, and consumer-oriented mining products.

Canaan stated that its AI chip unit, described in financial reports as “ASICs for edge computing applications,” generated approximately $900,000 in revenue in fiscal year 2024. However, operating expenses tied to the unit accounted for roughly 15% of total expenses. The company expects to complete the shutdown process in the coming months.

The decision reflects Canaan's commitment to streamlining operations, improving capital efficiency, and reducing expenditure on non-core businesses. While the AI business had shown promising innovation, the company said it did not align with its simplified growth strategy. Resources and management focus will be reallocated to strengthen Canaan's leadership in the fast-evolving digital asset ecosystem.

“Doubling down on our core strengths in crypto infrastructure and Bitcoin mining represents the most strategically meaningful path forward,” said Nangeng Zhang, Chairman and CEO of Canaan. “This adjustment will allow us to accelerate innovation in next-generation mining hardware and infrastructure, better serve our global clients, and solidify our leadership in the foundational layers of the digital asset economy.”

Founded in 2013, Canaan pioneered the use of ASICs in blockchain computing and has remained a leading player in high-performance chip design and production. The company began AI chip development in 2016, debuting its first-generation Kendryte K210 in 2018, becoming the world's first commercial AI chip provider with RISC-V-based edge AI IP. Canaan positioned itself as China's first AI chip company to IPO in the U.S. and the world's first blockchain-focused public company upon its 2019 Nasdaq listing.

Despite early momentum and significant investment, Canaan had already begun evaluating the AI business's future in March 2022, hiring external advisors to explore options including partial or full divestiture or an orderly shutdown. The termination is expected to significantly reduce operating costs.

Canaan's Kendryte chip family once marked major milestones in AI innovation. The K210 chip featured a dual-core RISC-V architecture with 1TOPS performance at just 0.3W, offering strong capabilities in vision and audio processing. The second-generation K510 launched in 2021 achieved 2TOPS, supporting floating-point operations and advanced ISP integration. Its successor, the K230, introduced in 2022, offered multi-precision AI performance with upgraded heterogenous compute units and broad interface support. The K230D further optimized for compact, high-performance use cases.

With the AI chip division now discontinued, these once-promising innovations—designed for smart devices, edge computing, and AIoT—will no longer be commercialized.

As of the latest market close, Canaan's shares traded at $0.609, with a total market capitalization of $280 million.