Galaxy Digital Inc-A(GLXY) - 2025 Q2 - Quarterly Results

Q2 2025 Financial and Corporate Highlights Galaxy Digital reported strong Q2 2025 financial performance with significant asset and equity growth, returning to net income and positive Adjusted EBITDA, alongside strategic corporate advancements Select Financial Metrics Overview Galaxy Digital Inc. reported significant quarter-over-quarter growth in key financial metrics for Q2 2025, including a substantial increase in total assets, total equity, and balance sheet net digital assets, returning to net income and positive Adjusted EBITDA Select Financial Metrics (Q2 2025 vs Q1 2025, in millions) | SELECT FINANCIAL METRICS | Q2 2025 | Q1 2025 | Q/Q % Change | | :--------------------------------- | :-------- | :-------- | :----------- | | Total Assets | $9,086M | $6,336M | 43 % | | Total Equity | $2,624M | $1,902M | 38 % | | Cash & Stablecoins | $1,181M | $1,185M | — % | | Balance Sheet Net Digital Assets | $1,274M | $908M | 40 % | | Balance Sheet Venture, Fund and Other Investments | $718M | $623M | 15 % | | Net Income / (Loss) | $30.7M | ($295M) | N.M. | | Adjusted EBITDA | $211M | ($290M) | N.M. | Key Corporate and Financial Updates Galaxy Digital achieved a net income of $30.7 million and Adjusted EBITDA of $211 million in Q2 2025, driven by digital asset appreciation and strong operating performance, successfully completing its reorganization and beginning trading on Nasdaq, with post-quarter record performance in Digital Assets and expanded Helios data center capacity - Net income for Q2 2025 was $30.7 million, or $0.08 per diluted share[6] - Adjusted EBITDA reached $211 million in Q2 2025, primarily due to the appreciation of balance sheet digital assets and investments, alongside positive Digital Assets operating business performance[6] - Total equity stood at $2.6 billion as of June 30, 2025, with $1.2 billion held in cash and stablecoins[6] - Galaxy commenced trading on Nasdaq under the ticker GLXY on May 16, 2025, following a successful corporate reorganization and domestication as a Delaware entity[6] - July 2025 marked the strongest monthly financial performance for the Digital Assets operating business in the firm's history, with record results in Global Markets[6] - Subsequent to quarter end, Galaxy completed the sale of over 80,000 bitcoin for a client, one of the largest notional bitcoin transactions in digital assets history[6] - CoreWeave exercised its final option for an additional 133 MW of critical IT load at Galaxy's Helios data center campus, committing to the full 800 MW of approved gross power[6] - Galaxy entered an agreement to acquire 160 acres of land and a 1 GW load interconnection request adjacent to Helios, expanding the campus to over 1,500 acres and increasing total potential power capacity to 3.5 GW[6] Segment Performance Analysis This section details the performance of Galaxy Digital's Digital Assets and Data Centers segments, highlighting growth in Global Markets and significant expansion in HPC infrastructure Digital Assets The Digital Assets segment reported a 10% QoQ increase in adjusted gross profit to $71.4 million, primarily driven by growth in Global Markets, despite a slight decline in adjusted EBITDA due to increased expenses, with Assets on Platform growing 27% QoQ to approximately $9 billion Digital Assets Segment Performance (Q2 2025 vs Q1 2025, in millions) | Metric | Q2 2025 | Q1 2025 | Q/Q % Change | | :--------------------------- | :-------- | :-------- | :----------- | | Digital Assets Adjusted Gross Profit | $71.4M | $64.7M | 10 % | | Digital Assets Adjusted EBITDA | $13.0M | $13.0M | (1)% | - Digital Assets generated adjusted gross profit of $71.4 million, up 10% quarter-over-quarter, driven by growth in Global Markets[10] - Adjusted EBITDA for Digital Assets was $13.0 million, down modestly QoQ, as higher adjusted gross profit was offset by increased compensation and general and administrative expenses[10] - Galaxy ended Q2 2025 with approximately $9 billion in combined assets under management and assets under stake, increasing 27% QoQ due to appreciating digital asset prices and net inflows[19] Global Markets Global Markets adjusted gross profit increased 28% QoQ to $55.4 million, despite a 22% decline in digital asset trading volumes, outperforming the broader market, with the average loan book size growing 27% to $1,107 million and the Investment Banking team recognizing revenue from the Bitstamp acquisition Global Markets Key Performance Indicators (Q2 2025 vs Q1 2025, in millions) | KEY PERFORMANCE INDICATORS | Q2 2025 | Q1 2025 | Q/Q % Change | | :------------------------- | :-------- | :-------- | :----------- | | Global Markets Adjusted Gross Profit | $55.4M | $43.2M | 28 % | | Loan Book Size (Average) | $1,107M | $874M | 27% | | Total Trading Counterparties | 1,445 | 1,381 | 5% | - Global Markets adjusted gross profit totaled $55.4 million in Q2 2025, increasing 28% QoQ[10] - Digital asset trading volumes declined 22% QoQ, primarily due to reduced spot trading activity, but Galaxy outperformed the broader market's 30% decline[10] - Average loan book size increased to $1,107 million in Q2 2025, driven by continued demand for margin lending and a growing client base[18] - The Investment Banking team recognized revenue from its role as the exclusive financial advisor to Bitstamp in its acquisition by Robinhood[18] Asset Management & Infrastructure Solutions Asset Management & Infrastructure Solutions generated $16.0 million of adjusted gross profit in Q2 2025, a 26% QoQ decline, mainly due to lower industry-wide onchain activity impacting validator rewards, despite Assets on Platform growing 27% to $8,921 million with significant increases in ETFs, Alternatives, and Assets Under Stake Asset Management & Infrastructure Solutions Key Performance Indicators (Q2 2025 vs Q1 2025, in millions) | KEY PERFORMANCE INDICATORS | Q2 2025 | Q1 2025 | Q/Q % Change | | :------------------------- | :-------- | :-------- | :----------- | | Adjusted Gross Profit | $16.0M | $21.6M | (26)% | | Assets on Platform | $8,921M | $7,020M | 27% | | ETFs | $3,327M | $2,598M | 28% | | Alternatives | $2,444M | $2,079M | 18% | | Assets Under Stake | $3,150M | $2,343M | 34% | - Adjusted gross profit for Asset Management & Infrastructure Solutions was $16.0 million, declining 26% QoQ, driven by lower industry-wide onchain activity and reduced validator rewards[12] - Subsequent to quarter end, Galaxy integrated with Fireblocks to broaden access to its staking services, marking the third custodial integration this year[19] Data Centers (High-Performance Computing) Galaxy's Data Centers segment, focused on High-Performance Computing, saw CoreWeave commit to the full 800 MW of gross power at the Helios campus, with an additional 133 MW option exercised, and is expanding the Helios campus to over 1,500 acres with a total potential power capacity of 3.5 GW through a new land acquisition, with construction for Phase I on schedule and revenue generation expected in the first half of 2026 - CoreWeave exercised its final option for an additional 133 MW of critical IT load for AI and HPC operations at Galaxy's Helios data center campus, committing to the full 800 MW of currently approved gross power[15] - Galaxy entered an agreement to acquire 160 acres of land and a 1 GW load interconnection request adjacent to the Helios campus, expanding the campus size to over 1,500 acres and increasing total potential power capacity to 3.5 GW[16] - Construction at the Helios campus is progressing on schedule, with major interior demolition for Phase I complete and site work underway[17] - Galaxy expects to begin generating Data Centers revenue in the first half of 2026, upon delivering critical IT capacity to CoreWeave under Phase I of the lease agreement[10] Helios Data Center Campus Committed Critical IT Load and Revenue Projections | Metric | Value | | :----------------------------------- | :---------- | | Contracted Critical IT Load (MW) | 133 | | Committed Critical IT Load (Phase I, MW) | 260 | | Committed Critical IT Load (Phase II, MW)| 133 | | Total Committed Critical IT Load (MW)| 526 | | Expected Delivery Date (Phase I) | 1H26 | | Expected Delivery Date (Phase II) | 2027 | | Expected Delivery Date (Phase III) | 2028 | | Anticipated Average Annual Revenue ($) | $1B+ | Balance Sheet and Consolidated Financials Galaxy Digital's Q2 2025 financials show substantial growth in total assets and equity, a return to net income, and a detailed breakdown of its diversified digital asset and investment exposures Balance Sheet Net Digital Asset and Investment Exposure Galaxy's balance sheet maintains a diversified exposure to the digital asset ecosystem, including spot positions, ETFs, venture investments, private equity holdings, and fund investments, with its net digital asset and investment exposure as of June 30, 2025, reflecting this diversified allocation - The Company's balance sheet maintains exposure to the digital asset ecosystem through a diversified allocation across spot positions, ETFs, venture investments, private equity holdings and fund investments[24] Consolidated Statements of Financial Position As of June 30, 2025, Galaxy Digital Inc. reported total assets of $9,085,951 thousand, a significant increase from December 31, 2024, primarily driven by increases in digital intangible assets, digital assets loan receivable, and assets posted as collateral, with total equity also seeing a substantial rise Consolidated Statements of Financial Position (Selected, in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------------- | :------------ | :---------------- | | Assets | | | | Cash and cash equivalents | $691,331 | $462,103 | | Digital intangible assets | $3,186,098 | $2,547,581 | | Digital assets loan receivable, net | $894,876 | $579,530 | | Assets posted as collateral | $718,649 | $277,147 | | Property and equipment, net | $596,120 | $237,038 | | Total assets | $9,085,951 | $7,119,855 | | Liabilities | | | | Digital assets borrowed | $2,836,370 | $1,497,609 | | Collateral payable | $1,869,501 | $1,399,655 | | Total liabilities | $6,461,733 | $4,925,503 | | Equity | | | | Total stockholders' equity | $1,506,321 | $2,194,352 (GDH LP Unit Holders) | | Noncontrolling interest | $1,117,897 | — | | Total equity | $2,624,218 | $2,194,352 | Consolidated Statements of Operations For the three months ended June 30, 2025, Galaxy Digital Inc. reported a net income of $30,691 thousand, a significant improvement from a net loss in the prior year and prior quarter, driven by positive gains from operations despite high transaction expenses, with diluted EPS at $0.08 Consolidated Statements of Operations (Selected, in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :------------------------------- | | Revenues | $8,661,555 | $8,882,891 | | Gains / (losses) from operations | $395,094 | ($18,180) | | Revenues and gains / (losses) from operations | $9,056,649 | $8,864,711 | | Transaction expenses | $8,629,940 | $8,834,836 | | Total operating expenses | $8,890,256 | $9,003,390 | | Net income / (loss) before taxes | $42,161 | ($139,640) | | Income taxes expense / (benefit) | $11,470 | ($14,044) | | Net income / (loss) | $30,691 | ($125,596) | | Net income / (loss) per Class A common stock (Diluted) | $0.08 | ($0.37) | Ownership of GDH LP Limited Partnership Interests As of June 30, 2025, Galaxy Digital Inc. held a 45.5% ownership interest in GDH LP, with noncontrolling interests holding 54.5%, reflecting the Reorganization Transactions completed on May 13, 2025, where Galaxy Digital Holdings Ltd. was acquired by Galaxy Digital Inc., and Class B Unit Holders became noncontrolling interests Ownership of GDH LP Limited Partnership Interests | Entity | June 30, 2025 Ownership | June 30, 2025 % interest | | :-------------------------- | :---------------------- | :----------------------- | | Galaxy Digital Inc. | 170,332,037 | 45.5 % | | Noncontrolling interests | 203,885,332 | 54.5 % | | Total | 374,217,369 | 100.0 % | - On May 13, 2025, Galaxy Digital Holdings Ltd. was acquired by Galaxy Digital Inc. as a result of the Reorganization Transactions, and the Class B Unit Holders of GDH LP became noncontrolling interests of Galaxy Digital Inc[49] Non-GAAP Financial Measures and Reconciliations This section explains Galaxy Digital's non-GAAP financial measures, including adjusted gross profit and Adjusted EBITDA, and provides detailed reconciliations to GAAP figures for Q2 2025 Non-GAAP Financial Measures Explanation Galaxy Digital uses non-GAAP financial measures such as adjusted gross profit, adjusted EBITDA, and EBITDA margin to provide supplemental disclosure for management and investors, considering these measures useful for understanding operating performance, risk management, and comparing results across periods by excluding non-cash or unpredictable items not driven by core operations - Adjusted gross profit, adjusted EBITDA, and EBITDA margin are non-GAAP financial measures used as supplemental disclosure, not as substitutes for GAAP[35] - Adjusted gross profit is considered helpful as it eliminates the impact of directly attributable transaction expenses, providing insight into financial performance[38] - Adjusted EBITDA excludes items like equity-based compensation, interest expense on structural debt, taxes, depreciation, and certain gains/losses, as these are non-cash, unpredictable, or not core to operations[40] - EBITDA Margin is defined as EBITDA divided by revenue minus pass-through expenses, used as an analytical indicator of performance[41] Reconciliation of Revenue and Gains/(Losses) from Operations The reconciliation shows that for Q2 2025, total adjusted gross profit was $299,232 thousand, a significant improvement from a negative adjusted gross profit in Q1 2025, primarily driven by positive contributions from Digital Assets and Treasury & Corporate segments Reconciliation of Revenue and Gains/(Losses) from Operations to Adjusted Gross Profit (in thousands) | Metric | Digital Assets | Data Centers | Treasury and Corporate | Total | | :-------------------------------------- | :------------- | :----------- | :--------------------- | :--------- | | Three Months Ended June 30, 2025 | | | | | | Revenues and gains / (losses) from operations | $8,711,215 | $— | $345,434 | $9,056,649 | | Less: Transaction expenses | $8,596,478 | $— | $33,462 | $8,629,940 | | Less: Impairment of digital assets | $43,307 | $— | $84,170 | $127,477 | | Adjusted gross profit | $71,430 | $— | $227,802 | $299,232 | | Three Months Ended March 31, 2025 | | | | | | Revenues and gains / (losses) from operations | $13,063,899 | $— | ($208,024) | $12,855,875 | | Less: Transaction expenses | $12,920,860 | $— | $26,150 | $12,947,010 | | Less: Impairment of digital assets | $78,308 | $— | $34,121 | $112,429 | | Adjusted gross profit | $64,731 | $— | ($268,295) | ($203,564) | Reconciliation of Adjusted EBITDA Galaxy Digital's total Adjusted EBITDA for Q2 2025 was $211,227 thousand, a significant turnaround from a negative Adjusted EBITDA in Q1 2025, largely driven by the Treasury and Corporate segment's contribution of $198,264 thousand Reconciliation of Adjusted EBITDA (in thousands) | Metric | Digital Assets | Data Centers | Treasury and Corporate | Total (June 30, 2025) | | :-------------------------------------- | :------------- | :----------- | :--------------------- | :-------------------- | | Net income / (loss) | ($2,535) | $— | $33,226 | $30,691 | | Add back: Equity based compensation | $11,826 | $— | $6,957 | $18,783 | | Add back: Notes interest expense and other expense | $— | $— | $12,042 | $12,042 | | Add back: Taxes | $— | $— | $11,470 | $11,470 | | Add back: Depreciation and amortization expense | $3,560 | $— | $3,898 | $7,458 | | Add back: Unrealized (gain) / loss on notes payable – derivative | $— | $— | $125,150 | $125,150 | | Add back: Reorganization and domestication costs | $— | $— | $4,867 | $4,867 | | Adjusted EBITDA | $12,963 | $— | $198,264 | $211,227 | | | | | | Total (March 31, 2025) | | Net income / (loss) | $3,529 | ($2,899) | ($296,061) | ($295,431) | | Adjusted EBITDA | $13,038 | ($1,177) | ($301,364) | ($289,503) | Company Information and Disclosures This section provides an overview of Galaxy Digital Inc.'s business, details on its earnings call, and a cautionary statement regarding forward-looking information About Galaxy Digital Inc. Galaxy Digital Inc. is a global leader in digital assets and data center infrastructure, providing solutions that advance finance and artificial intelligence, with its platform offering institutional access to trading, advisory, asset management, staking, self-custody, and tokenization technology, alongside operating cutting-edge data center infrastructure for AI and high-performance computing - Galaxy is a global leader in digital assets and data center infrastructure, delivering solutions that accelerate progress in finance and artificial intelligence[30] - Its digital assets platform offers institutional access to trading, advisory, asset management, staking, self-custody, and tokenization technology[30] - The company invests in and operates cutting-edge data center infrastructure to power AI and high-performance computing in the U.S.[30] Earnings Conference Call & AMA Galaxy Digital hosted an investor conference call on August 5, 2025, to discuss its financial results, with a live webcast and replay available, and an Earnings AMA was also scheduled for August 7, 2025, via X Spaces for further discussion - An investor conference call was held on August 5, 2025, at 8:30 AM Eastern Time, with a live webcast and replay available on the company's investor relations website[28] - Galaxy hosted an Earnings AMA on Thursday, August 7, at 10:30 AM Eastern Time via X Spaces, where management may discuss financial results and forward-looking statements[29] Cautionary Statement About Forward-Looking Statements This press release contains forward-looking statements regarding Galaxy's future expectations, plans, and goals, including those related to the CoreWeave lease and Helios campus expansion, which are subject to various risks and uncertainties such as market conditions, regulatory changes, technological challenges, and financing, potentially causing actual results to differ materially from projections, and investors are cautioned against undue reliance on these statements - The press release contains forward-looking statements regarding expectations, hopes, beliefs, intentions, or strategies for the future, including business plans and goals related to the CoreWeave lease[32] - These statements are based on current expectations and beliefs but involve risks and uncertainties that may cause actual results to differ materially, including inability to maintain Nasdaq listing, costs related to AI/HPC plans, changes in laws, economic factors, and market disruptions[32] - Specific risks include challenges in retrofitting facilities for AI/HPC, difficulties in obtaining financing, changes in AI/HPC infrastructure needs, and delays in land acquisition or business mandates[32][33] - Investors are cautioned not to place undue reliance on forward-looking statements, and the company assumes no obligation to update or revise them[33]