Cango Inc.

I would now like to turn the conference over to Paul Yu, CEO. Please go ahead.

Hello, everyone, and welcome to Kendall's third quarter 2025 earnings call. This quarter marks the one-year anniversary of our strategic transformation into a Bitcoin miner, an important milestone for the company. Today, I will reveal our third quarter results. and share how Kangal continues to create long-term value in a rapidly changing market environment. During third quarter, we remain focused on our core mining operations, further strengthening Kangal's position as a skilled and operationally disciplined Bitcoin miner. This is clearly reflected in our financial performance. In the third quarter, Total revenue reached $225 million, up 60.6% sequentially. Operating income was $43.5 million, and net income was $37.3 million. Today, Tango operates a deployed hash rate of 50 exahash globally. positioning us among the leading miners worldwide. In the third quarter, we produced 1,930.8 bitcoins, averaging 21 bitcoins per day, up 37.5% in total output and 36% in daily production compared with the second quarter, 2025. Leveraging our asset-light model, we built a competitive global footprint across the Americas, the Middle East, and Africa in just one year. In our mining operations, we continue to execute our strategy of prioritizing hash rate optimization over expansion by refreshing older, less energy efficient models to the T21 and S21 series and discipline operations with significantly improved average operating hash rate from 40.91 exahash in July to 44.85 exahash in September and further to 46.09 exahash in October with efficiency surpassing 90% In August, we also acquired a 50 megawatt mining facility in the state of Georgia, lowering per unit operating costs and building dedicated energy infrastructure to support our long-term strategy. The current market environment remains volatile with significant fluctuations in Bitcoin prices Kendall is closely monitoring this dynamics and will continue to manage our deployed output and explore partnership models to mitigate market risks and enhance operating stability. While consolidating our core business, we also clarify our long-term strategy. Building a global distributed AI compute network powered by green energy, we will be combining as a practical on-ramp towards our energy and compute ambitions, following the sequence of from Bitcoin mining to energy exercise, and from operational steps to AI compute deployment. In the third quarter, we executed our first roadmap with strict financial discipline, launching small-scale pilots with clear technical and IRR thresholds across both energy and AI compute. Our clean energy projects in Oman and Indonesia are now underway and are expected to be commissioned within the next one or two years, providing strategic support for subsequent AI infrastructure development. In AI compute, Kendall is taking a differentiated approach. Instead of building large centralized data centers, they focus on flexible distributed compute units. In practical, this will integrate dispersed GPU resources into standardized compute pools and break them into smaller units tailored to the needs of small and mid-sized enterprises. This approach is enabled by two core advantages, our distributed operational expertise and our global energy footprints, allowing us to execute a unique isolated plus edge-first strategy In terms of governance, we have assembled a new leadership team with deep experience in digital infrastructure and finance and completed the transmission from an ADR listing to a direct listing on the NYSE to enhance transparency and reduce shareholder transaction costs. These initiatives provide strong support for our next phase of development. Lastly, let me briefly update you on our legacy business. Our used car export platform, Auto Kangal, delivered strong performance this quarter with revenue of 3.3 million US dollars, up 90% sequentially. The platform remains at that light and continues to scale. connecting buyers from Africa, the Middle East, and Eastern Europe with quality vehicle inventory from China. With that, I will now turn the call over to Michael Zhang, our Chief Financial Officer, to take you through the financials in more detail.

Thanks, Paul. Hello, everyone, and welcome to our third quarter 2025 earnings call. Before I begin the review of our financials, please note that starting this quarter we will begin reporting U.S. dollars, which better reflects the profile of our revenues and profit following divestiture of our China asset in May 2025. Unless otherwise specified, all amounts discussed are U.S. dollars. Total revenue in the third quarter of 2025 was $224.6 million, up 60.6 percent sequentially revenue from the bitcoin mining business in the third quarter of 2025 was 220.9 million with a total of 1930.8 bitcoins mined during the period up 50.9 percent and 37.5 percent respectively respectively out of sequential basis the average cost of mining bitcoin excluding depreciation of mining machines was $81,072 per coin, with owing cost at $99,383 per coin. Revenue from our automotive training business was $3.3 million in the third quarter of 2025. Now let's move on to our cost and expenses during the quarter. Cost of revenues exclusive for depreciation in the third quarter of 2025 was $100,000 62.6 million. Depreciation in the third quarter of 2025 was 35.4 million. General and administrative expenses in the third quarter was 6 million. We recorded operating income of 43.5 million and net income of 37.3 million in the third quarter of 2025 compared with an operating loss of 1.2 million and a net loss of 9.5 million in the same period last year. On a non-GAAP basis, adjusted EBITDA for the third quarter of 2025 was $80.1 million, compared with $1.2 million in the same period last year. Moving on to our balance sheet, as of September 30, 2025, we had cash and cash equivalents of $44.9 million. Our balance sheet also reflects $660 million receivables for Bitcoin collateral. In terms of operational asset, we carry our mining machine at a net value of $365.7 million after depreciation. On the liability side, we have $405.1 million in long-term debt owed to related parties. Together, these figures represent the core components of our financial structure as we close the third quarter of 2025. This concludes our prepared remarks. Operator, we are now ready to take questions.