Galaxy Digital (GLXY), the financial services and investment firm focused on digital assets and blockchain technology, saw its shares decline more than 13% following the release of its second-quarter earnings, which included an $85 million net loss. The stock closed near $19.07 during the trading session. Despite softer digital asset prices, the company reported improved operating results and recorded its first revenue from the Helios data center business in West Texas.

Source: KnockOutStocks

Q2 Loss Narrows as Digital Assets Segment Strengthens

Galaxy Digital posted an $85 million net loss for the second quarter, an improvement from the $216 million loss recorded in the prior quarter. The adjusted diluted loss narrowed to $0.09 per share, down from $0.49, beating analyst consensus expectations of a $0.28 per share loss.

The company attributed weaker treasury and corporate results to declining digital asset prices, which produced a $42 million adjusted gross loss driven by unrealized losses on digital asset holdings and investment positions. Adjusted EBITDA improved to a loss of $77 million, compared with a $188 million loss in the first quarter.

Galaxy's digital assets segment reported stronger operating results despite challenging market conditions. Adjusted gross profit from the segment rose 34% quarter over quarter to $66 million, even as trading volume fell 7%.

The negative market reaction appeared to reflect investor focus on the quarterly loss and the absence of new data center lease announcements.

Helios Data Center Reaches Commercial Operation

Galaxy's Helios campus in West Texas generated revenue for the first time following the commencement of commercial operations for Phase I. The data center business produced $20 million in adjusted gross profit and $11 million in adjusted EBITDA during the quarter after delivering 200 megawatts of gross power—including 133 megawatts of critical IT capacity—to CoreWeave, a specialized AI cloud computing provider, under a 15-year lease agreement.

The company projects that Helios Phase I will generate approximately $80 million in quarterly leasing revenue beginning in the third quarter.

CEO Mike Novogratz stated, "This quarter, both sides delivered. The [Helios] campus is now generating cash flow."

Novogratz added, "Crypto bear markets are the best time to build," while noting sustained institutional demand for both AI and digital asset infrastructure.

Galaxy expanded its AI infrastructure pipeline by acquiring three additional development sites in Texas, increasing its potential power capacity to more than 5.7 gigawatts. The push into AI infrastructure places Galaxy among a growing group of digital asset firms—including companies such as Hut 8 and Core Scientific—that are diversifying into high-performance computing to reduce reliance on cryptocurrency market cycles.

$3.5 Billion Financing Funds Helios Phase II

Galaxy recently completed a $3.5 billion private offering of senior secured notes through its subsidiary, Galaxy Helios Data Centers II LLC. The proceeds are earmarked for construction of Helios Phase II and continued expansion of the company's AI infrastructure business.

The financing raised Galaxy's total debt to more than $6 billion. The company also confirmed that discussions with prospective tenants for an additional 830 megawatts of approved capacity at the Helios campus are ongoing, though no new lease agreements were announced during the quarter.

Bloomberg previously reported that Novogratz expected the remaining capacity at the Texas campus to be leased before the end of summer. Galaxy confirmed that negotiations with potential customers remain active while construction and site development continue.

The company reported that its operating businesses generated $86 million in adjusted gross profit and $1 million in adjusted EBITDA during the quarter. Management stated that the business is becoming "less dependent on the overall direction of the market" as AI infrastructure contributes a growing share of earnings alongside its digital asset operations.