GALAXY DIGITAL INC. earnings calls

Helios II lease talks

Q (Patrick Moley · Piper Sandler): Why did you step away from the Helios II lease talks this summer and what terms would make you sign? Was the decision driven by economics or counterparty/credit support?

A: Management said conversations got serious but market conditions changed: delays, tighter power expectations, and complex financing structures made details uncertain. They paused to broaden the process and are now in active talks with several high-grade potential tenants focused on 2028 power needs.

"With all that as the backdrop, we decided to take a pause, take a breath, reignite conversations more broadly." — Christopher C. Ferraro

Capital priorities and maturing notes

Q (James Yaro · Goldman Sachs): What are current capital deployment priorities given the new buyback, maturing notes, and data center funding needs? Would you replace the notes maturing in December with new debt?

A: They prioritize business needs across their two segments and keep a capital buffer. They have liquidity and liquid investments and said they have the resources to pay the $445 million of notes maturing in December without refinancing, while remaining opportunistic on buybacks.

"we have the capital resources to pay that back in full without refinancing it." — Anthony Philip Paquette

Why digital assets loss persists

Q (Peter Christiansen · Citi): What investments are suppressing digital assets profitability and what must change for sustainable EBITDA?

A: Management said lower crypto volumes and prices reduced activity, though Galaxy grew volumes and the lending book. They are investing in digital infrastructure, people, and licensure to capture longer-term real-world asset tokenization, and noted a small one-time accounting change affected this quarter's EBITDA.

"we are adding, recurring revenue streams, which we think is you know, the most important part of building a more durable business." — Anthony Philip Paquette

CoreWeave contracts and tenant visibility

Q (James Faucette · Morgan Stanley): How do CoreWeave's customer contracts work for Helios I, and will the same partners take phases 2 and 3? What market steps are needed before you announce a Helios II tenant?

A: They said their leases are with CoreWeave's parent, so Galaxy's counterparty exposure is to CoreWeave's whole customer portfolio, not a single end tenant; allocations to specific data halls will change over time. For Helios II, they cited regulatory clarity (Texas audits and allocations) and energization timing as helpful steps before tenants finalize contracts.

Tokenization and Galaxy's role

Q (Devin Ryan · Citizens Bank): What regulatory guidance are you watching and how will Galaxy compete to participate in tokenizing real-world assets? Which assets are most attractive and how will you partner on infrastructure?

A: They think crypto infrastructure will be used by traditional finance and are building a business to partner with those institutions. They are focused on on-chain credit, asset management, and infrastructure work with firms like BNY; investments now are mainly tech and regulatory to win positioning over 24–36 months.

"Because what happens they need to be there. 1 of our businesses that is putting a lot of effort into it is growing, is actually being the partner to help build that infrastructure for traditional finance companies." — Michael Edward Novogratz (CEO)

Helios II timing and Phase III funding

Q (Edward Engel · Compass Point): Does walking away this summer extend Helios II leasing timeline? Also, does Phase I/II cash flow still self-fund Phase III given maturing notes and buybacks?

A: They said Helios II energization is expected in mid 28, giving about 1.75 years to find partners and design deals, so they can be deliberate. Phase I and II are fully funded to completion; Phase III is equity funded and they expect to seek debt financing in the first half of 27 but do not need to refinance now.

"Helios 2's energization timeline, is expected to be in mid 28." — Christopher C. Ferraro

Permits and construction risk

Q (Brett Knoblauch · Cantor Fitzgerald): How critical is having permits before signing a Helios II lease, and how do customers view a possible permitting freeze or extension tied to the election?

A: They said for Helios 1–3 they already have the permits needed to begin and continue construction; remaining approvals relate mainly to diesel backup and site utilities and are not construction limiters. They are confident current permitting freezes will not affect their Helios timelines.

"For Helios, for Helios, 1 and 2 and 3 under development, we have all the permits in hand needed to begin and continue construction." — Christopher C. Ferraro

Project finance lender stance

Q (Jonathan Petersen · Jefferies): Will lenders finance leases signed before ERCOT approvals, or must you pass the April/other deadlines? Are lenders tightening covenants and LTV/LTC metrics?

A: They said existing facilities are not impacted by Texas regulatory uncertainty and remain available. Lenders are generally more conservative about funding before clear energization rights, but Galaxy can use its balance sheet and delay market financing until clarity in 2027, giving them flexibility.

"The existing facilities we have in place, are not impacted at all by, any potential perceived uncertainty." — Christopher C. Ferraro

Trading share gains and lending growth

Q (Joseph Vafi · Canaccord): Any specifics on trading share gains in the quarter and appetite to expand the lending book while managing risk?

A: They reported trading volumes grew 12% quarter over quarter while industry volumes were flat, indicating market share gains. The lending book grew about 27% quarter over quarter; they will grow the loan book selectively and develop structures to scale lending off balance sheet responsibly.

"On the trading side, I think factually, the numbers are that our volumes grew 12% quarter over quarter." — Christopher C. Ferraro

Partnerships with TradFi and revenue mix

Q (Christopher Brendler · Rosenblatt): How are partnerships with traditional financial institutions progressing and how might digital assets revenue mix shift toward asset management, custody, staking, or platform fees?

A: They said adoption will likely be slow then fast; Galaxy is building infrastructure and partnering selectively with large institutions to own key components and to white-label other services. This lets them charge build fees and stack recurring platform revenue while trading and lending can continue to grow alongside new recurring fee businesses.

"what we are doing today is we are selectively partnering with some of the largest institutions who need to own certain components think base layer custody" — Christopher C. Ferraro

Galaxy 1 retail product roadmap

Q (Benjamin Sommers · BTIG): How will Galaxy 1 contribute to revenue over time and what retail or wealth products are coming?

A: They said Galaxy 1 assets are growing (north of $125 million) and their 2027 roadmap includes expanded brokerage across multiple asset classes and higher-end wealth management products for high-net-worth clients. They expect differentiated offerings to roll out starting Q1 27.

"What we look forward to next year in 2027 actually is rolling out expanded brokerage capabilities across a number of different asset classes." — Christopher C. Ferraro

Phase II revenue recognition change

Q (Bloomberg): Why did the Phase II average annual revenue assumption tick down from last quarter? Does this reflect demand or positioning changes?

A: They said nothing fundamental changed for Phase II or its revenue; the change was a GAAP lease accounting clarification to help analysts model revenue recognition, not an operational change.

"Nothing has changed with regard to phase 2 and the revenue." — Anthony Philip Paquette

Equipment procurement and long lead items

Q (Bill Papanastasiou · Chardan): How are you managing long lead-time equipment procurement for on-contract sites and any pressure on Helios II energization?

A: They said their approach is to be early and deliberate and they can place deposits and lock future capacity due to their balance sheet. For Helios II they have committed approximately $230 million in deposits and purchase orders for long-lead electrical infrastructure to protect timelines.

"For Helios II already, we have already committed approximately $230 million in deposits and purchase orders for future electrical infrastructure." — Christopher C. Ferraro

Credit market stress and outlook

Q (Martin Toner · ATB Cormark): What do you think of current credit market stress, how will it resolve, and on what timeline?

A: He said recent credit stress reflects oil and rate moves and a psychological reset to higher rates; time and changes in oil prices and equity raises (which reduce credit need) should ease pressure. He expects markets to adjust and sees equity raises and AI investment as positive signs for credit markets over time.

"This war in Iran has kept oil prices over a $100." — Michael Edward Novogratz (CEO)