Bitcoin Slide Fuels Galaxy Digital’s $85 Million Q2 Loss

Crypto News

Weakness in Bitcoin (BTC), the market’s benchmark crypto asset, moved from token charts to corporate income statements on Wednesday, where Galaxy Digital posted an $85 million net loss for its second quarter and saw its stock fall 14%. The result tied directly to lower digital asset prices, which pressured the firm’s Treasury and Corporate segment and produced an adjusted gross loss of $42 million. Galaxy’s shares finished at $19.07, compared with the prior close of $22.14, giving investors a stark read on how quickly crypto exposure can reset earnings after stronger periods. The decline was the market’s immediate verdict on a quarter in which balance-sheet markdowns outweighed operational progress. The loss narrowed from $216 million in the first quarter, but revenue still declined 15% to $8.7 billion from $10.2 billion in the prior three months, offsetting gains from the company’s artificial intelligence data center effort. Adjusted diluted loss was $0.09 per share, while adjusted EBITDA came in at negative $77 million. Equity at the end of the quarter was $2.7 billion. The company’s digital assets unit offered a partial offset, increasing adjusted gross profit by 34% to $66 million, yet trading volumes slipped 7% as activity cooled. The divergence shows that service-based crypto revenue can sometimes hold up even when asset prices impair treasury holdings. That combination—better unit profitability but thinner participation—suggests a market still working through lower risk appetite rather than a broad return to speculative turnover. For market participants, the quarter reinforced that corporate crypto exposure carries mark-to-market risk that trading desks alone cannot neutralize. That lesson is likely to shape how investors value similar treasury-heavy crypto firms in upcoming results. It also raises scrutiny for any firm using balance-sheet crypto as a core earnings engine. The print also shows how listed crypto proxies can remain vulnerable after major tokens retreat from all-time-high zones and altcoin positioning becomes less liquid.

The earnings release also detailed a counterweight: Galaxy’s push into artificial intelligence infrastructure. The company finished phase one of power delivery for the Helios site in Texas, providing CoreWeave with 133 megawatts of critical computing load under a 15-year agreement. Management anticipates the arrangement will produce approximately $80 million per quarter, with margins exceeding 90%, from the third quarter onward. That contract structure gives Galaxy a longer-dated revenue stream than typical trading income, although it also requires substantial capital and construction execution. The expansion is not a retail product such as an AI crypto wallet or an automated AI trading bot; it is physical compute capacity, power capacity, and long-term leasing. Three additional Texas locations were acquired after the reporting period, expanding the company’s power pipeline to more than 5.7 gigawatts. On July 28, Galaxy issued $3.5 billion of senior secured notes maturing in 2031, directing the funds toward Helios I Phase II construction. For the quarter, data-center operations contributed adjusted gross profit of $20 million and adjusted EBITDA of $11 million, marking the segment’s first period of revenue-generating activity. The disclosure framed the unit’s milestone as a shift from development to revenue-generating operations, allowing investors to assess lease economics rather than only construction progress. If the anticipated quarterly revenue materializes, the segment could become a more meaningful hedge against crypto-market volatility, though timing and execution risk remain. The debt raise also signals confidence in long-duration financing for expansion ahead. Those figures remain small beside the company’s overall revenue base, but they establish a new earnings line that is contractually linked to compute demand rather than spot-market sentiment. For a firm whose balance sheet remains sensitive to digital-asset repricing, the strategic question is whether infrastructure cash flows can become large enough to absorb future drawdowns in trading and treasury holdings.

COINOTAG’s analysis ties both developments to one theme: crypto earnings are still dominated by mark-to-market exposure, even when companies build contract-backed alternatives. Bitcoin remains the benchmark asset whose drawdowns shape treasury results, while newer infrastructure lines need scale to matter. The company’s investor-relations disclosure states that the data-center unit recorded its first revenue-generating quarter, with adjusted gross profit of $20 million and adjusted EBITDA of $11 million. That primary figure is modest next to a $42 million treasury loss and negative $77 million adjusted EBITDA. Unlike algorithmic-stablecoins, the AI lease model depends on physical capacity and customer commitments. The valuation question is whether Bitcoin-linked volatility or infrastructure cash flow will dominate future quarters.