- Galaxy Digital made a smaller loss per quarter but fell short on revenue forecasts.
- AI data centers were a source of revenue and made positive gross profit.
- The stock was responding to news from Galaxy that no new tenants were found for its Texas-based data center.
Galaxy Digital recorded a smaller loss for the second quarter of 2026, although the firm did not perform well in terms of revenues as well as lack of AI data center customers impacted the stock price negatively.
The cryptocurrency financial service provider incurred a net loss of $85 million during the quarter due to declining digital assets prices, and revenues were lower than analysts had forecasted even though the firm started generating revenues through the AI infrastructure business.
Galaxy Digital Experiences Reduced Losses Amid Declining Revenue
Galaxy Digital reported a net loss of $85 million or $0.09 per diluted share in the second quarter of 2026. This was an improvement from the net loss of $216 million realized in the prior quarter, where the losses were at $0.49 per share.
The net income was even higher than what analysts had anticipated since the earnings were expected to be lower by $0.28 per share. The income from operations stood at $8.56 billion, falling 15% lower from $10.21 billion in the first quarter of the year.
The total earnings missed the estimates on Wall Street, which had estimated the earnings to be around $12.7 billion. The company cited reduced asset prices as one of the factors that impacted the financial performance.
AI Data Center Business Earns Its First Revenues
The AI data center business unit of Galaxy Digital earned revenues for the first time as the company finished construction of the first stage of its Helios campus in West Texas.
The segment posted a gross profit of $20 million and EBITDA of $11 million, while an EBITDA loss of $900,000 was posted in the first quarter.
Galaxy delivered 200 megawatts of gross power, which amounts to 133 megawatts of critical IT capacity, to CoreWeave as part of a 15-year lease arrangement.
The company has revealed that the partnership is going to create revenues worth around $1 billion annually. Previously, Galaxy had received funding amounting to $1.4 billion in August 2024 in order to help expand its Helios AI data center project.
Important highlights of the quarter
- Revenues from the AI data centers were recorded for the first time.
- Phase I of Helios was delivering capacities to CoreWeave.
- Three more Texas sites were purchased to build new data centers in the future.
No New Tenant Announcements Influence Market Reaction
Even though AI infrastructure saw its first revenue from operations, the quarterly performance showed no new customers or leases for the remaining capacity at Helios facility.
Galaxy indicated that it is still talking with potential tenants who represent approximately 830 megawatts of approved capacity.
Novogratz, the CEO of the company, mentioned earlier this year that he was confident that all the available capacity in the 1.6 GW Texas-based facility would be leased out by the end of summer. The firm did not disclose any new partnerships while releasing its earnings results.
Following the earnings announcement, the stock price of Galaxy Digital declined more than 5% in pre-market trading hours. The stock price of the company had already dropped by about 20% within the last 12 months prior to the earnings announcement on Aug. 5.
Digital Asset Business Remains Profitable
Even though cryptocurrency values fell in the quarter, Galaxy has maintained profitability in its digital assets business through the positive results of adjusted operating metrics.
Its adjusted gross profit is at $66 million, up 34% on a quarter-over-quarter basis despite the decline in the company’s trading volumes by 7%. Galaxy recorded an adjusted EBITDA of $11 million from its digital assets business.
As per CoinMarketCap statistics, during the reporting period, the market capitalization of the overall cryptocurrency market reduced by almost 15% to about $2 trillion as of June 30 from $2.35 trillion as of April 1.
Galaxy pointed out that the results show diversification of the earnings since a greater share of the revenue comes not from changes in the digital assets’ price.
Financial highlights
- At the end of the second quarter, Galaxy’s cash and cash equivalents amounted to $2.46 billion.
- On July 28, there was a $3.5 billion private placement of senior secured notes due in 2031.
- The funding will be used for constructing Helios Phase II, raising the company’s total debt to above $6 billion.
Frequently Asked Questions
Why did Galaxy Digital incur a loss in the third quarter?
The firm stated that the loss incurred by the company due to the fall in the value of cryptocurrencies in the second quarter amounted to $85 million despite beating analysts’ forecasts on earnings per share.
What is the profitability of the AI data center business segment?
The unit made a profit for the first time, recording an adjusted gross profit of $20 million.
Why did Galaxy Digital stocks decline after the earnings announcement?
Galaxy Digital stocks declined because of the firm’s failure to attract new clients to the AI data center business unit.
