This article first appeared on GuruFocus .
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Total Revenue:$50.8 million for Q2 2026.
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Bitcoin Mining Revenue:$47.4 million, with 656 Bitcoins mined during the quarter.
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Average Cash Mining Cost:$73,313 per Bitcoin, down about 35% from Q1.
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All-in Mining Cost:$98,405 per Bitcoin.
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Cost of Revenue (excl. depreciation):$50.7 million, down from $99.6 million in Q1.
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Depreciation:$16.9 million, down from $29.4 million in Q1.
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General and Administrative Expenses:$8.4 million, including related party fees.
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Impairment Loss from Mining Machines:$42.9 million in Q2.
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Loss on Disposal of Mining Machines:$8.5 million in Q2.
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Loss from Changes in Fair Value of Crypto Assets:$4.1 million, compared with a loss of $151.8 million in Q1.
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Operating Loss:$80.6 million for the quarter.
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Net Loss from Continuing Operations:$81.6 million in Q2.
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Adjusted EBITDA (non-GAAP):Loss of $10.7 million.
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Cash and Cash Equivalents:$10.1 million as of June 30, compared with $7.2 million as of March 31.
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Bitcoin Holdings:1,056 Bitcoins held in treasury as of June 30.
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Long-Term Debt:$31.2 million as of June 30, compared with $30.6 million as of March 31.
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Self-Mining Hash Rate:19.84 exahashes per second as of June 30.
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Leased Hash Rate:7.74 exahashes per second as of June 30.
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Combined Operating Hash Rate:27.58 exahashes per second as of June 30.
Release Date: September 01, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Cango Inc ( NYSE:CANG ) reduced its average cash mining cost by 35% quarter-over-quarter to $73,313 per Bitcoin, improving operational efficiency.
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The company implemented a Bitcoin hedging program to manage price volatility, enhancing cash flow predictability without speculative intent.
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Cango Inc ( NYSE:CANG ) completed construction of its Georgia AI infrastructure site, supporting up to 3 megawatts, and signed its first customer contract, marking commercial monetization.
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The company shifted to a leasing model for some hash rate, reducing exposure to variable operating costs and improving cash flow profile.
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Cango Inc ( NYSE:CANG ) holds 1,056 Bitcoins in treasury and maintains a strong balance sheet with $10.1 million in cash, despite a challenging quarter.
Negative Points
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Cango Inc ( NYSE:CANG ) reported a significant net loss of $81.6 million in Q2 2026, driven by non-cash impairment and disposal losses totaling approximately $51 million.
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Total revenue decreased by about 50% sequentially to $50.8 million, reflecting deliberate hash rate reductions and capacity shifts.
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The company incurred a $42.9 million impairment loss and an $8.5 million loss on disposal of mining machines due to restructuring.
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Bitcoin production fell to 656 coins in Q2, down sequentially, as self-mining capacity was reduced and some capacity transitioned to leasing.
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AI infrastructure revenue is still minimal, with only a small customer contract signed, and the company faces uncertainty in scaling this new business.
Q & A Highlights
Q: Can management provide more color on the Bitcoin hedging program in terms of overall notional size, instrument structure, and duration? Additionally, could you clarify whether this is risk mitigating or it involves any directional positioning? A: Ming Yeung Tang (CFO): The hedging program is structured as a short-term loan denominated in BTC, reflected on the balance sheet under short-term debt (around $8 million as of quarter end). The loan is lent to us on day one and sized based on the scale of our Bitcoin mining production (e.g., one or two months of production). The BTC is sold at spot price on day one, and if Bitcoin prices fall below that level in the coming month, we choose to repay in BTC mined from our operations. We purely view this as a risk management tool to reduce the sensitivity of our cash flow to Bitcoin price ranges, not for speculative purposes.
Q: Regarding the AI infrastructure progress you highlighted, such as the Georgia site completion and container deployment, what is the rationale for including them now? More importantly, could we incorporate this development as material included in our third quarter financial models? A: Peng Yu (CEO): We wanted to give you the most current picture of where the AI business stands. Even though these developments fall after June 30's cut-off and are not reflected in this quarter's revenue, only a small amount of property-related costs have been capitalized in Q2, which is immaterial. We expect to begin recognizing AI-related revenue in the third quarter. The initial contribution will be modest, but it provides initial validation of the commercial viability of our AI infrastructure strategy and establishes an operating track record we can build on.
Q: Regarding the newly signed customer contracts, could you provide some visibility into the anticipated revenue contribution and timeline for top-line recognition? A: Peng Yu (CEO): Since the start of the third quarter, we have signed a customer contract and discussions with prospective customers are ongoing. This takes our AI business from technical validation into commercial monetization. Contracted revenue is still small, and we expect to begin recognizing related revenue in the third quarter. We plan to pursue both bare metal GPU hosting using our existing site and power infrastructure, as well as colocation to improve overall infrastructure utilization.
Q: Should we expect Q3 mining revenue to stabilize at current levels or anticipate further hash rate reductions? A: Ming Yeung Tang (CFO): In terms of operational hash rate and the mining machines on our balance sheet, it would not change significantly in the third quarter. However, given that the third quarter includes the summer months of July and August, we may experience some regional power curtailment.
Q: Could you provide some color on roughly how much of the current hash rate is from S19 versus newer generation machines? A: Ming Yeung Tang (CFO): The percentage of newer generation machines is increasing. In terms of the mix between the 19s and the 21s, excluding the part that is leased, the split is roughly a little bit above 1/3 in the 21 series.
Q: Are you able to talk about your cash costs? Can you further cut costs? How should we look at Q3? A: Ming Yeung Tang (CFO): The cost optimization in Q2 was driven by two reasons. First, we continued to negotiate with our hosted sites, as most of our sites are externally hosted. Second, many contracts have a power price reduction mechanism whereby power prices decrease in an environment where Bitcoin prices are decreasing. Looking at the cash cost on a month-by-month basis during Q2, the cash cost was on a downward trend, providing downside protection.
Q: How much of your existing mining infrastructure or power capacity could realistically be converted to AI infrastructure over the next three years? A: Ming Yeung Tang (CFO): We're starting in the US at the moment, still more focused on our own 50-megawatt site. We have started to install small test nodes in other sites, but these are not necessarily our own sites; they could be with partner sites.
Q: What were the key drivers behind the significant reduction in total revenue and costs in Q2 2026? A: Ming Yeung Tang (CFO): Total revenue decreased by approximately 50% compared to Q1, primarily reflecting our proactive reduction in operational hash rate as we selectively phased out older, less efficient S19 series mining machines and temporarily transitioned some capacity to a hosted leasing model. While this adjustment reduced top-line mining revenue, it significantly lowered operating costs and improved our cash flow profile. Cost of revenue exclusive of depreciation was $50.7 million, down from $99.6 million in Q1, driven by lower electricity and hosting expenses.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
