HANGZHOU, China, March 18, 2024 (GLOBE NEWSWIRE) -- Nano Labs Ltd (Nasdaq: NA) (“we,” the “Company” or “Nano Labs”), a leading fabless integrated circuit design company and product solution provider in China, today announced its unaudited financial results as of December 31, 2023 and for the six months ended December 31, 2023
Second Half of 2023 Financial Highlights
- Net revenue was RMB26.1 million (US$3.7 million) for the second half of 2023, compared to RMB603.0 million in the same period of 2022.
- Gross loss was RMB40.6 million (US$5.7 million) for the second half of 2023, compared to a gross profit of RMB53.8 million in the same period of 2022.
- Loss from operations was RMB124 million (US$17.6 million) for the second half of 2023, compared to a loss from operations of RMB86.9 million in the same period of 2022.
- Net loss was RMB120.0 million (US$16.9 million) for the second half of 2023, compared to a net loss of RMB80.3 million in the same period of 2022.
- Net loss per share (both basic and diluted) was RMB1.91 (US$0.27) for the second half of 2023, compared to a net loss per share (both basic and diluted) of RMB1.47 in the same period of 2022.
Mr. Jianping Kong, Chairman and Chief Executive Officer of the Company, commented, “In the second half of 2023, our company benefited from supportive government policy and positive market trends. The Hong Kong government's strong support for the web3.0 industry and the historic approval of the first Bitcoin spot ETF by the SEC in early 2024 have bolstered the industry, infusing optimism and propelling progress. Our management team is actively pursuing global market expansion opportunities. Through a series of market expansion initiatives, we aim to continue exploring potential market opportunities to increase our market share.
In terms of research and development, our Cuckoo series iterative products are currently undergoing intensive R&D efforts. Significant advancements were made in the latter half of 2023, and we anticipate the launch of enhanced versions of our products in 2024, which are expected to deliver substantially improved performance. Additionally, our company is concurrently upgrading our packaging technology and IP to enhance the efficiency of chip production. We are also laying the groundwork for research and development of AI computing, ZK computing, and other chips to seize emerging market opportunities.
Our metaverse business line, iPollo Metaverse, offers a photography studio service that includes 3D scanning and 3D printing services. This service has not only received high praise from athletes at the Asian Games but has also provided diverse digital application scenarios for various IPs. It assists in the digitalization of various types of IPs, helping them enter the metaverse track. Furthermore, the photography studio service offers personalized customization services to users, allowing a wide range of enthusiasts to experience the joy of DIY in the metaverse.”
Mr. Bing Chen, Chief Financial Officer, commented, “For the second half of 2023, our net revenue was RMB26.1 million (US$3.7 million). In addition, the net loss was RMB120.0 million (US$16.9 million) for the six months ended December 31, 2023, compared to a net loss of RMB80.3 million in the same period of 2022. While the company's performance in the second half of 2023 may not have met expectations, we are encouraged by the gradual recovery in the market. We firmly believe that with the favorable policies and support, coupled with our continuous dedication and efforts, we will continue to progress and provide foundational services for the development of the web3.0 industry!”
Second Half of 2023 Financial Results
Net Revenues
Net revenue was RMB26.1 million (US$3.7 million) for the second half of 2023, compared to RMB603.0 million for the same period of 2022. The decrease in net revenues was primarily due to the drop of sales volume of iPollo V1 Series and B1 Series. The revenues in 3D-printing products, our new products, was RMB787 thousand for the second half of 2023, compared to nil for the same period of 2022.
Cost of Revenues
Cost of revenues was RMB66.6 million (US$9.4 million) for the second half of 2023, compared to RMB549.2 million for the same period of 2022. The change was mainly due to the decrease in sales volume and partially offset by an increase in inventory write-down.
The cost of 3D-printing products was RMB629 thousand for the second half of 2023, compared to nil for the same period of 2022.
Operating Expenses
Total operating expenses decreased by 40.4% to RMB83.8 million (US$11.8 million) for the second half of 2023, from RMB140.7 million for the same period of 2022.
- Selling and marketing expenses decreased to RMB5.8 million (US$0.8 million) for the second half of 2023, from RMB14.3 million for the same period of 2022. The decrease in selling and marketing expenses was primarily due to the decrease in advertising fee and marketing promotion expenses.
- General and administrative expenses decreased by 38.4% to RMB22.4 million (US$3.2 million) for the second half of 2023, from RMB36.3 million for the same period of 2022. The decrease in general and administrative expenses was primarily due to the decrease in professional fees and employee salary expenses as the number and salaries of general and administrative staff decreased.
- Research and development expenses decreased by 38.3% to RMB55.6 million (US$7.9 million) for the second half of 2023, from RMB90.2 million for the same period of 2022. The decrease in research and development expenses was primarily due to the decrease in equipment cost, salary expenses and share-based compensation expenses. The Company expects to continue its significant investment in research and development to support its future development, product iteration, and competitive strengths.
Loss from Operations
Loss from operations was RMB124.4 million (US$17.6 million) for the second half of 2023, compared with loss from operations of RMB86.9 million for the same period of 2022.
Finance Income
Finance income was RMB0.7 million (US$0.1 million) for the second half of 2023, compared with finance income of RMB3.8 million for the same period of 2022.
Net Loss
Net loss was RMB120.0 million (US$16.9 million) for the second half of 2023, compared with RMB80.3 million in the same period of 2022.
Basic and Diluted Loss Per Ordinary Share attributable to Nano Labs Ltd
Basic and diluted loss per share was RMB1.91 (US$0.27) for the second half of 2023, compared with basic and diluted loss per share of RMB1.47 for the same period of 2022.
Cash and Cash Equivalents
As of December 31, 2023, the Company had cash and cash equivalents of RMB48.2 million (US$6.8 million), compared with RMB87.8 million as of December 31, 2022.
Exchange Rate
This press release contains translations of certain Renminbi (RMB) amounts into U.S. dollars (US$) solely for the convenience of the reader. Unless otherwise specified, all translations of Renminbi amounts into U.S. dollar amounts in this press release are made at RMB7.0827 to US$1.00, the central parity rate on December 31, 2023 published by the People’s Bank of China.
Non-GAAP Financial Measures
In evaluating our business, we consider and use adjusted net income/(loss) as an additional non-GAAP measure to review and assess our operating performance. The presentation of the non-GAAP financial measure is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. We define adjusted net income/(loss) as net income/(loss) excluding share-based compensation expense.
We present the non-GAAP financial measure because they are used by our management to evaluate our operating performance and formulate business plans. Non-GAAP financial measures enable our management to assess our operating results without considering the impact of non-cash charges and non-operating items. We also believe that the use of the non-GAAP measure facilitates investors’ assessment of our operating performance.
