Galaxy Digital posts $216M Q1 loss as crypto slump hits, data centers switch on

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Galaxy Digital (Nasdaq: GLXY) swung to a Q1 2026 net loss of $216 million, as a roughly 20% decline in digital asset prices during the quarter pulled the crypto‑focused financial services firm into the red despite growing fee and infrastructure revenue.

In its earnings release, the company reported diluted earnings per share of $(0.49) and said “the decline in token prices and unrealized losses on balance sheet positions more than offset operating income” across trading, asset management, and principal investments.

Management stressed that the loss narrowed compared with the prior quarter and argued that the business mix is becoming less sensitive to crypto price swings. “While digital asset volatility continues to impact our reported net income, our core operating businesses remain resilient, and we are executing on a strategy that diversifies our revenue base,” Galaxy said in its shareholder letter.

The firm pointed to its Digital Assets segment — spanning trading, lending, asset management, and staking — which generated hundreds of millions of dollars in adjusted gross profit over 2025, even as full‑year net income was negative.
Last year Galaxy posted a $241 million net loss for 2025, but adjusted EBITDA of $216 million and a stock price that jumped more than 11% after the annual report underscored that investors were willing to look through non‑cash marks.

Data Centers start to earn as Helios ramps

The first quarter also marked a structural shift: Galaxy’s Data Centers division booked revenue for the first time, reflecting the initial commercialization of its Helios AI campus in West Texas.
“We anticipate revenue from our data center business to commence in the first half of 2026,” management had said on a prior earnings call, a timeline that Q1’s results suggest the company is now meeting.

Helios, which Galaxy has described as a “multi‑hundred‑billion‑dollar digital infrastructure opportunity,” has secured more than 1.6 gigawatts of approved capacity and a long‑term contract with AI cloud provider CoreWeave that is expected to generate over $1 billion in annual revenue at full ramp.
Galaxy recently closed a $1.4 billion project financing facility to fund the site’s initial retrofit and expansion, positioning the firm less as a pure crypto trading proxy and more as a hybrid of digital assets bank and AI infrastructure play.

CEO Mike Novogratz has argued that this pivot gives Galaxy a durable earnings engine that is less correlated to bitcoin and altcoin prices, even if quarterly results like Q1’s still reflect the sector’s boom‑bust dynamics.
For investors, the tension between a $216 million reported loss and the first trickle of data center revenue underlines the central question around GLXY: how quickly Helios and related projects can scale to outweigh crypto market drawdowns in the income statement.