Nano Labs Ltd (NASDAQ: NA) made its Nasdaq debut on Tuesday, raising approximately $20 million by selling 1.8 million American Depository Shares (ADSs) at $11.50 each. The stock initially surged nearly 4.8% on its first day but experienced a sharp decline of 27% the following day, reflecting the high volatility in the industry it operates in. The IPO price was near the top of the company’s target range, although Nano Labs had to reduce its initial fundraising goal by about half.
Founded in 2019 by former executives of Canaan Inc., Nano Labs specializes in chip design, outsourcing manufacturing to third-party foundries like Taiwan’s TSMC. Despite a remarkable 18-fold increase in sales last year, its revenue remains modest at around $6 million, overshadowed by significant operating expenses of over $27 million, primarily for research and development. The company’s association with cryptocurrency adds another layer of complexity to its market performance.
Nano Labs Advancements and Strategic Developments
The first half of 2024 has demonstrated a clear recovery in the industry, with new market opportunities emerging steadily. In this bullish market environment, Nano Labs Ltd (NASDAQ: NA) has significantly invested in the research and development of its upgraded Cuckoo Series products. In May 2024, the company commenced mass production of the Cuckoo 3.0 chip, which boasts enhanced performance compared to the previous Cuckoo 2.0 chip, setting a new global benchmark. This advancement positions the company to leverage new market opportunities.
The company plans to introduce a range of models featuring the Cuckoo 3.0 chip throughout the remainder of 2024 and into early 2025, anticipating a substantial boost in sales. Additionally, innovations in packaging technology and intellectual property are underway to improve chip production efficiency. The company is also advancing in AI computing, ZK computing, and other chip technologies.
Moreover, the iPollo Metaverse’s photography studio service, part of its broader Metaverse business suite, is progressing steadily. The company’s strategic collaborations with various institutions lay the groundwork for significant growth potential. With continued industry support, the company aims to overcome current challenges and achieve new levels of success.
Nano Labs Financial Overview for the First Half of 2024
In the first half of 2024, Nano Labs Ltd (NASDAQ: NA) reported net revenue of RMB24.74 million (USD3.47 million), a decline from RMB52.37 million in the same period of the previous year. This decrease was largely attributed to reduced sales of the iPollo V1 Series product. However, revenue from 3D-printing products saw a notable increase, rising to RMB459,200 from RMB22,000.
The cost of revenues for the first half of 2024 was RMB24.71 million (USD3.47 million), down from RMB115.2 million in the same period of 2023. This reduction was due to lower sales volumes and fewer inventory write-downs. Operating expenses also decreased by 20.1% to RMB58.72 million (USD8.24 million), with notable reductions in selling and marketing expenses, which fell by 54.4% to RMB4.33 million (USD0.61 million), and general and administrative expenses, which decreased by 18% to RMB25.45 million (USD3.57 million).
Research and development expenses decreased by 12.2% to RMB28.93 million (USD4.06 million), mainly due to lower salary costs. The company’s loss from operations narrowed to RMB58.69 million (USD8.24 million), and net loss was RMB59.50 million (USD8.30 million). Basic and diluted loss per share improved to RMB0.85 (USD0.12), compared to RMB2.41 in the previous year. As of June 30, 2024, cash and cash equivalents were RMB23.51 million (USD3.3 million), down from RMB48.15 million at the end of 2023. The company remains confident in its strategic direction and aims to leverage its technological strengths for long-term growth and shareholder value.
Working From a Position of Financial Strength
The cost of revenues for the first half of 2024 was RMB24.71 million (USD3.47 million), down from RMB115.2 million in the same period of 2023. This reduction was due to lower sales volumes and fewer inventory write-downs. Operating expenses also decreased by 20.1% to RMB58.72 million (USD8.24 million), with notable reductions in selling and marketing expenses, which fell by 54.4% to RMB4.33 million (USD0.61 million), and general and administrative expenses, which decreased by 18% to RMB25.45 million (USD3.57 million).
Research and development expenses decreased by 12.2% to RMB28.93 million (USD4.06 million), mainly due to lower salary costs. The company’s loss from operations narrowed to RMB58.69 million (USD8.24 million), and net loss was RMB59.50 million (USD8.30 million). Basic and diluted loss per share improved to RMB0.85 (USD0.12), compared to RMB2.41 in the previous year. As of June 30, 2024, cash and cash equivalents were RMB23.51 million (USD3.3 million), down from RMB48.15 million at the end of 2023. The company remains confident in its strategic direction and aims to leverage its technological strengths for long-term growth and shareholder value.
