Key Takeaways:
- Galaxy Digital posted a $216M Q1 loss as the crypto market fell approximately 20% by March 31.
- Galaxy Digital assets fell 12% to approximately $10B, showing crypto sector volatility impact.
- Galaxy Digital bets on Helios, adding 830MW; Coreweave deal to drive Q2 revenue.
Mike Novogratz’s Galaxy Holds $2.6B Cash as $216M Loss Tests Market Strategy
Galaxy Digital Holdings posted a sharp quarterly loss of $216 million as falling digital asset prices weighed on its investment portfolio, underscoring the sector’s continued sensitivity to market swings even as the firm expands into infrastructure.
The company reported the net loss of $216 million for the three months ended March 31, compared with a $482 million loss in the prior quarter. The improvement was largely relative, as a roughly 20% drop in total crypto market capitalization during the period eroded the value of Galaxy’s holdings. Adjusted EBITDA came in at negative $188 million, while adjusted gross loss totaled $88 million.
Total assets fell 12% quarter-on-quarter to just under $10 billion, and equity declined to $2.8 billion. Still, Galaxy maintained a strong liquidity position, holding $2.6 billion in cash and stablecoins.
The firm’s core digital assets business showed resilience. Adjusted gross profit in the segment reached $49 million, only slightly below the previous quarter, supported by steady fee income and transaction revenue. Trading volumes held flat even as broader market activity declined, while the average loan book shrank 20% to $1.4 billion amid client deleveraging.
Pressure was most evident in Galaxy’s Treasury and corporate unit, which recorded a $140 million adjusted gross loss driven by unrealized losses on digital assets and investments.
At the same time, Galaxy is pressing ahead with a strategic pivot toward data infrastructure. In April, shortly after quarter-end, the company delivered its first data hall at the Helios campus to Coreweave, marking the start of revenue generation for the project.
The Helios site has also secured regulatory approval for an additional 830 megawatts of power capacity, bringing total approved capacity to more than 1.6 gigawatts. The expansion reflects strong demand for high-performance computing infrastructure, particularly tied to artificial intelligence (AI) workloads.
Asset management remained a mixed picture. Assets under management stood at roughly $5 billion, down from the previous quarter due to market depreciation, though the business attracted $69 million in net inflows. Galaxy also disclosed new partnerships, including a role supporting staking infrastructure for a Blackrock Ethereum exchange-traded product.
During the quarter, Galaxy repurchased $65 million worth of shares and completed its delisting from the Toronto Stock Exchange, consolidating trading on Nasdaq.
The results highlight a company navigating volatile crypto markets while betting on more stable, long-term revenue streams. Whether that shift can offset continued price-driven earnings swings remains an open question.