Nano Labs (NA) Q4 2025 earnings review
Paper Profits Mask a Dying Hardware Business
Nano Labs reported a massive swing to profitability in the second half of 2025, posting RMB 137.7M in net income. However, this is entirely an accounting mirage driven by a RMB 130M mark-to-market gain on its cryptocurrency (BNB) holdings. Under the hood, the core legacy hardware business is collapsing. While revenue grew 18% YoY, gross margins collapsed to a catastrophic -155% due to massive inventory write-downs. By gutting R&D expenses by 77%, management is starved its legacy operations to aggressively pivot into a cryptocurrency holding company. For investors, this is no longer an operating tech firm—it is a leveraged proxy for BNB token prices.
🐂 Bull Case
The company has accumulated over 126,000 BNB tokens. As global macroeconomic conditions and crypto adoption improve, this strategic reserve offers immense asset appreciation potential completely decoupled from chip sales.
Management is forcefully rationalizing the core business. Selling & marketing expenses were cut by 56%, and R&D by 77%, stopping the operational cash bleed from legacy operations.
🐻 Bear Case
A gross margin of -155% and an RMB 47.8M cost of revenue on just RMB 18.7M in sales signals that their legacy inventory is practically worthless and had to be written down severely.
The company's entire bottom line is now tethered to the volatility of a single digital asset (BNB). If the crypto market reverses, the paper profits will vanish, leaving behind an operationally empty shell.
⚖️ Verdict: 🔴
Bearish. The spectacular headline net income is an illusion created by crypto appreciation. The underlying hardware operations are generating massive gross losses, and cash reserves are dwindling despite the paper gains.
Key Themes
Catastrophic Gross Margin Collapse
Despite management touting an 18.1% revenue growth to RMB 18.7M, the real story is the horrifying cost of those revenues. Cost of revenues spiked to RMB 47.8M, resulting in a RMB 29.1M gross loss. This reversing trend from a positive RMB 11.6M gross profit a year ago was driven by heavy write-downs of obsolete inventory and unrecoverable VAT, proving the legacy product line is essentially dead weight.
Crypto Treasury is the New Core Business
The company's strategic pivot to adopting BNB as a primary reserve asset is now the sole engine of profitability. The company booked a RMB 130M gain on the fair value of cryptocurrencies, totally offsetting its operating and gross losses. The balance sheet has been thoroughly transformed, with crypto assets now totaling RMB 768.5M across current and non-current assets.
Starving R&D to Fund the Pivot
Research and development expenses are decelerating aggressively, plummeting 76.9% YoY to a mere RMB 4.9M. For a company that historically billed itself as an advanced computing chip designer, this signals an abandonment of future technological innovation in favor of acting as a cryptocurrency holding vehicle.
The AI Agent Hardware Pivot
Management announced the official launch of the iPollo ClawPC A1 Mini in March 2026, designed to support the Open Claw AI Agent system. The company plans to follow this with the Claw OS system. This represents a desperately needed new narrative and potential revenue vector, shifting from crypto mining hardware to the edge AI ecosystem.
Macro Tailwinds Driving Crypto Allocation
CEO Jianping Kong explicitly cited the continuous improvement of the global crypto market environment and rising market participation as the rationale for their balance sheet transformation. The company successfully executed two rounds of financing in 2025 specifically to expand these crypto asset reserves.
Other KPIs
Decelerating sharply. Cash and cash equivalents plummeted from RMB 32.4 million at the end of 2024 to just RMB 8.5 million. Despite massive paper profits from crypto holdings, the company's liquid cash position is alarmingly low, raising questions about how it will fund day-to-day operations without liquidating its BNB reserves.
Accelerating. Up 30.3% YoY. While all other operational expenses (S&M, R&D) were aggressively cut, G&A spiked, driven primarily by higher professional services fees, likely related to their complex crypto acquisitions, financing rounds, and strategic restructuring.
This represents the combined value of current (RMB 343.8M) and non-current (RMB 424.7M) cryptocurrencies on the balance sheet. Crypto now dwarfs traditional property, plant, and equipment (RMB 182.6M), officially cementing Nano Labs as an asset management company rather than a hardware producer.
Key Questions
Funding the Buyback
You announced a $25 million share repurchase program, yet your ending cash balance is only RMB 8.5 million (roughly $1.2 million). Will you be forced to liquidate your BNB reserves to fund this buyback?
End of the Write-Downs?
The massive RMB 47.8M cost of revenues was largely driven by inventory write-downs. Have you completely cleared out all obsolete iPollo V Series inventory, or should we expect this gross margin drag to continue into 2026?
Hardware Development Viability
You just launched the iPollo ClawPC A1 Mini and announced plans for the Claw OS. How are you funding the engineering and rollout of a new AI hardware ecosystem when you have cut R&D expenses by nearly 80%?