Canaan Inc. (NASDAQ: CAN), a leading provider of supercomputing solutions, saw its stock price tumble 5.28% in after-hours trading on Friday, reversing gains made earlier in the day. The sharp decline came on the heels of the company's announcement of a significant share offering.

During regular trading hours, Canaan's stock had performed impressively, rising 5.9% and leading gains among Asian equities traded as American depositary receipts (ADRs) in the US market. However, the positive momentum was abruptly halted when the company revealed plans to offer up to $270 million in American Depositary Shares representing Class A ordinary shares, according to an SEC filing made public after the market close.

The stark reversal in Canaan's stock performance highlights the impact of potential share dilution on investor sentiment. While the capital raise could provide the company with funds for expansion or other strategic initiatives, the market's immediate reaction reflects concerns about the offering's effect on existing shareholders. As trading resumes in the next session, investors will be closely watching how Canaan's stock price adjusts to this new development and any further details the company may provide about the use of proceeds from the share offering.