Galaxy swings to $323M Q3 profit, adds $200M buyback

Mike Novogratz's Galaxy Digital (GLXY) swung back to a profit in the third quarter, earning $323 million after an $85 million loss in the second, and announced another $200 million share buyback. Crypto trading, lending and its young AI data center business all grew, according to the company's earnings release, The Block reports.

The quarter in numbers

• Net income: $323 million for the three months to 30 September, down from $505 million a year earlier.
• Adjusted gross profit: $569 million, up from $43 million in Q2. Adjusted EBITDA: $455 million, versus minus $77 million.
• Trading: digital asset volumes rose 12% from Q2 even as spot volumes across the market fell.
• Lending: the average loan book climbed 27% to $1.8 billion, helped by the Galaxy Onchain Financing Rate product launched in July, which taps DeFi lending markets such as Aave and Morpho. Our new explainer on what crypto lending is covers how those markets work.
• Assets: $10.4 billion in combined assets under management and under stake, up 46% since June.

The digital assets division lifted adjusted gross profit to $71 million but still lost $9 million on an adjusted EBITDA basis; management said a one-time accounting adjustment, which it did not size, caused the loss. The bigger driver was Treasury & Corporate, with $419 million in adjusted gross profit, mostly from higher valuations of its crypto and private holdings, including AI chip startup Etched and Solana treasury company Forward Industries.

Data centers ramp up

Data centers made $79 million in adjusted gross profit, almost four times Q2's $20 million, in the first full quarter of revenue from the Helios I Phase I lease to CoreWeave in Texas (133 MW of critical IT load). Galaxy's gross power pipeline now exceeds 5.7 GW, and the first Phase II data halls are due in Q2 2027. On the call, Novogratz said Galaxy expects an annualised leasing revenue run rate of $800 million to $850 million by the end of 2027, and that it walked away from a possible Helios II lease over the summer as demand from AI companies grew.

The buyback

The board approved the new $200 million repurchase on 26 October. Galaxy finished its February program on 15 October after buying about 9.8 million shares. The new plan has no end date and the company is not obliged to use all of it. Galaxy's research desk also made headlines this morning with its bitcoin accumulation call as ETF inflows returned.