Galaxy Digital swings to $323 million quarterly profit, announces new $200 million share buyback

Galaxy Digital Galaxy Digital Holdings (GLXY) reported $323 million in net income for the third quarter of 2026, swinging back into profit after an $85 million loss in the previous quarter, as its crypto trading, lending, and AI data center businesses grew.

The Mike Novogratz-led firm posted $569 million in adjusted gross profit and $455 million in adjusted EBITDA for the three months ended Sept. 30, according to its earnings release on Tuesday. Both were up sharply from the second quarter, when adjusted gross profit stood at $43 million, and adjusted EBITDA was negative $77 million. Net income was lower than a year earlier, however, when Galaxy made $505 million.

Galaxy reported a 12% increase in digital asset trading volumes from the previous quarter, despite lower volumes across the broader spot market. Lending also grew, with the firm's average loan book reaching $1.8 billion, up 27%. Some of that demand came through its Galaxy Onchain Financing Rate product, which launched in July and draws on DeFi lending markets including Aave and Morpho, the firm said.

Adjusted gross profit from digital assets rose to $71 million from $66 million, although the division still lost $9 million on an adjusted EBITDA basis. On Tuesday's earnings call, management said the division would have been profitable without a one-time accounting adjustment during the quarter, but did not specify the size of the adjustment.

Galaxy's Treasury & Corporate business made a much larger contribution, recording $419 million in adjusted gross profit compared with a $42 million loss in the second quarter. Management said the gains came largely from higher valuations of its digital asset holdings and private investments, including positions in AI chip startup Etched and Solana Solana (SOL) treasury firm Forward Industries.

Galaxy said it had $10.4 billion in combined assets under management and assets under stake at the end of September, up 46% from the end of June.

Galaxy also announced Tuesday that its board had authorized another $200 million in Class A common stock repurchases on Oct. 26. The company completed its previous buyback program on Oct. 15, purchasing approximately 9.8 million shares under the $200 million authorization announced in February. The new program has no set end date, and Galaxy is under no obligation to buy back the full $200 million, the firm said.

Data center earnings climb as Helios expansion continues

Galaxy made $79 million in adjusted gross profit from data centers in the third quarter, nearly four times the $20 million recorded in the previous quarter. Adjusted EBITDA for the business came to $69 million.

The figures include the first full quarter of revenue from its Helios I Phase I lease in Texas, after Galaxy delivered all 133 MW of critical IT load to CoreWeave by the end of June.

Galaxy has also increased its total gross data center power pipeline to more than 5.7 GW. At Helios I Phase II, construction is continuing ahead of the first scheduled data hall deliveries in the second quarter of 2027, the firm said in the release.

During Tuesday's earnings call, Novogratz said Galaxy expects to exit 2027 with an annualized leasing revenue run rate of $800 million to $850 million as Helios I Phase II comes online. He also revealed that Galaxy had passed on a potential Helios II leasing deal over the summer after tightening power supplies and growing demand from major AI companies prompted it to reconsider the terms on offer.

"Galaxy delivered a strong third quarter, reflecting the strength of our established Digital Assets franchise, significant appreciation across our investments portfolio, and the growing contribution from our Data Centers business," Novogratz said in the release.