Upexi(UPXI) - 2026 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - For the second quarter, total revenue was approximately $8.1 million, an increase of approximately $4 million or just over 100% compared to $4 million in the prior year quarter [17] - The net loss for the quarter was approximately $178.9 million or approximately $2.94 per share, primarily driven by $164.5 million of unrealized losses on digital assets [18] - The company had approximately $1.6 million in cash and 2.17 million Solana tokens as of December 31st [15] Business Line Data and Key Metrics Changes - Digital asset revenue for the six months ended December 31st, 2025, was approximately $11.2 million, reflecting the addition of the digital asset Treasury business [15] - The Treasury had an unrealized loss on digital assets of approximately $86.4 million, reflective of the Solana price per token of $124.48 at December 31st, 2025 [16] Market Data and Key Metrics Changes - The price of Solana fell 40% during the quarter and has fallen a further 31% since the quarter end [4] - The Spot Solana ETFs launched and have seen over $850 million of net inflows since [12] Company Strategy and Development Direction - The company aims to increase yield, hedge positions using a maturing options market, and capitalize on top opportunities created by market volatility [9] - The strategic plan includes raising capital above NAV to increase digital assets per share and issuing in-kind convertible notes at a premium to NAV [20] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about the future despite a turbulent start to 2026, believing that the subsector will work through oversupply through M&A or asset sales [6] - The company is focused on growing Solana's holdings on a per-share basis through disciplined capital activities and maintaining prudent leverage and risk management [18] Other Important Information - The company became shelf-eligible during the quarter and filed a shelf registration statement on Form S-3 with the SEC [13] - A $50 million share repurchase program was announced, adding another tool for capital management [13] Q&A Session Summary Question: With the recent pressure on Solana, is there any change in terms of your capital raising strategy? - Management stated that they have not changed their perspective and continue to aim for raising capital above NAV [24] Question: How do you weigh buying SOL versus keeping a reserve? - Management emphasized the importance of maintaining cash reserves due to market volatility and indicated a cautious approach to capital allocation [26] Question: Can you elaborate on generating additional yield outside of staking? - Management is exploring a strategy that can generate high yield in a low-risk way, focusing on familiar market activities rather than on-chain options [30][37]