BitGo Posts $44.1 Million Profit Despite 50.9% Revenue Decline
Key Facts
BitGo reported results on November 9 for the third quarter ended September 30, 2026, posting net income of $44.1 million, after a loss of $19.0 million in the second quarter and profit of $22.7 million a year earlier. Diluted earnings per share were $0.36, compared with a loss of $0.16 in the previous quarter and profit of $0.15 in the year-ago period. The company said the improvement in net income was driven mainly by an unrealized gain of $71.5 million on its digital asset treasury. The operating picture was weaker, however: BitGo recorded an operating loss of $19.236 million and adjusted EBITDA loss of $4.3 million, versus adjusted profit of $13.5 million a year earlier. Meanwhile, total revenue contracted to $2.8519 billion, weighed down by lower digital asset sales activity.
Total revenue fell 50.9% year over year and 34.1% from the second quarter. Digital asset sales accounted for most of the total, generating revenue of $2.72 billion, down 52.0% from the year-ago period. Direct costs for the activity were $2.7158 billion, and the company put its margin at 15 basis points. BitGo said weaker trading activity and a higher share of lower-margin stablecoin transactions affected the business. After direct costs, revenue was $37.3 million, down 12.1% quarter over quarter and 32.1% year over year, highlighting the gap between the large volume of digital asset sales and the revenue remaining after their direct costs.
Other revenue streams performed unevenly during the quarter. Staking revenue was $68.2 million, up 5.4% from the second quarter but down 24.1% from a year earlier. Staking fees reached $64.2 million, with a take rate of 5.9%. Subscription and services revenue was $25.6 million, down 7.2% quarter over quarter and 24.5% year over year; the company attributed the quarterly decline mainly to the timing of nonrecurring engineering business revenue. Stablecoin services revenue was $37.4 million, down 3.8% from the previous quarter but up 52.5% year over year. BitGo said the quarterly decline reflected lower average reserve balances.
Operating expenses, excluding direct costs, fell to $56.6 million, down 5.5% from the second quarter. BitGo attributed the decline to cost-cutting initiatives launched in the second quarter. The company nevertheless remained in adjusted operating loss territory, with an adjusted EBITDA loss of $4.3 million, compared with profit of $13.5 million a year earlier. That puts the effect of lower expenses alongside weaker revenue after direct costs in assessing quarterly operating performance. The divergence between reported net income and operating loss also shows the role of the unrealized treasury gain in the period's results.
The number of platform clients continued to rise, reaching 6,640 in the third quarter, up 13.8% from the second quarter and 33.1% from the year-ago period. The company cautioned that the quarterly increase in the reported count does not necessarily mean new clients were acquired through customer acquisition or asset flows. Meanwhile, reported assets on the platform fell to $59.9 billion from $65.2 billion in the second quarter. BitGo said a decline in median digital asset prices was the main reason for the drop in reported value, while assets measured at benchmark prices rose 0.6% quarter over quarter to $59.9 billion, from $59.6 billion. Based on digital asset prices on September 30, platform assets were $83.0 billion and staked assets were $16.3 billion.
The company had $143.2 million in cash and cash equivalents on September 30, while its corporate treasury included 2,399 company-owned bitcoins with a fair value of $200.4 million. BitGo repurchased $24.7 million of common stock during the quarter under a share repurchase authorization of up to $50 million. On expansion, the company completed its acquisition of NYDIG's institutional trading business and related assets on August 27. In its filing, it said the deal expands its trading and derivatives capabilities and complements its custody, settlement and wallet services. The expansion is part of its effort to broaden its institutional services beyond custody.
The chief executive said BitGo is building financial infrastructure to bring traditional assets onchain, starting with tokenized stocks, and aims to expand access to U.S. equities through digital asset and stablecoin networks. Management was scheduled to hold a call to discuss third-quarter results on November 9 at 5 p.m. Eastern time, with a live webcast and recorded replay available. BTGO shares closed at $4.86 on November 6, before the results were announced. The company's results follow a quarter in which its activity metrics diverged: client numbers grew, reported-value revenue and assets declined, while benchmark-priced platform assets edged higher.