BitGo Q2 2026 Earnings: Revenue Rose 80% but Transaction Margins Narrowed

BitGo (NYSE: BTGO) reported Q2 2026 revenue of $4.329 billion, up 79.6% year over year, while basic and diluted EPS were $(0.16), compared with basic EPS of $0.33 and diluted EPS of $0.28 a year earlier. Digital Asset Sales drove most of the revenue increase, but narrower transaction economics and an $18.8 million unrealized loss on digital assets contributed to a $19.0 million net loss. Meanwhile, normalized assets on the platform increased 31.4%, indicating underlying asset growth after excluding digital asset price movements.

Core financial results

Revenue increased by approximately $1.9 billion, but direct costs rose slightly faster and absorbed nearly all of the additional revenue. Revenue less direct costs, a calculated measure rather than a company-reported GAAP subtotal, increased only about 7.6% to $42.5 million.

The bottom line reversed from a profit to a loss, primarily because BitGo recorded an $18.8 million unrealized loss on digital assets after recognizing a $55.8 million unrealized gain in Q2 2025. The operating loss also widened, showing that the earnings pressure was not limited to digital asset valuation changes.

Direct costs include transaction-related digital asset sales costs, staking fees and stablecoin sponsor fees.

Gross revenue growth outpaced transaction economics

BitGo’s business lines diverged during the quarter. Digital Asset Sales produced most of the reported growth, while Stablecoin-as-a-Service expanded rapidly from a smaller base. Staking revenue declined year over year even though normalized assets staked increased.

Digital Asset Sales generated approximately $7.1 million after direct costs. Its margin declined from 19 basis points a year earlier and 32 basis points in Q1 2026, reflecting lower spreads on some spot transactions and a reduced mix of derivatives activity. Because spot revenue is recognized on a gross basis and derivatives revenue on a net basis, changes in product mix can materially affect reported revenue without producing a comparable change in economic contribution.

Staking revenue rose 30.9% sequentially but remained below the prior-year quarter. Its take rate fell from 10.0% a year earlier and 16.1% in Q1 to 6.0%, with BitGo attributing the pressure to client mix and lower take rates. Subscriptions benefited from client activity and project-based implementation work, while Stablecoin-as-a-Service growth was supported by higher reserve balances and fixed monthly fees from newly supported programs.

Operating indicators presented a different picture from the unadjusted asset totals. Clients increased 26.2% to 5,833, while users rose 6.1% to 1.2 million. Reported assets on the platform declined 27.8% to $65.2 billion, but normalized assets increased 31.4%. Reported assets staked fell 53.6% to $11.9 billion, while normalized assets staked rose 36.1%. BitGo calculates the normalized figures by applying current-quarter median digital asset prices to prior-period balances, removing much of the effect of price movements.

Profitability, cash flow and balance sheet

The net loss improved sequentially from $60.7 million in Q1 to $19.0 million, mainly because the unrealized digital asset loss became smaller and compensation expense declined as IPO-related stock compensation normalized. However, adjusted EBITDA moved in the opposite direction: the loss widened from $1.7 million in Q1 to $4.2 million because Digital Asset Sales and Staking produced lower economic contribution, partially offset by lower cash compensation and professional fees.

Cash flow data were provided only for the first six months of 2026. Net cash used in operating activities was $36.2 million, compared with $8.1 million in the first half of 2025. That deterioration means the planned cost reductions will need to translate into better operating economics to improve cash conversion.

At June 30, BitGo had $159.0 million of unrestricted cash and cash equivalents, up from $106.3 million at the end of 2025. Consolidated cash totaled approximately $4.794 billion, but $4.635 billion was restricted for the benefit of stablecoin holders and matched by corresponding holder deposits. The corporate treasury also owned 2,523 Bitcoin valued at approximately $147.7 million, and the company reported no corporate-level debt.

BitGo authorized a share repurchase program of up to $50 million. The authorization provides capital-allocation flexibility but does not indicate how much stock the company will ultimately repurchase.

Management perspective

Management said it had narrowed investment priorities and strengthened the operating model through actions expected to produce approximately $15 million in annualized cash savings. The quarter included $1.3 million of restructuring charges, and CFO Ed Reginelli said the second-half focus would be converting business growth into stronger earnings and more durable financial performance.

CEO Mike Belshe emphasized growing institutional adoption and BitGo’s role in regulated digital asset infrastructure. After quarter-end, the company supported DTCC’s demonstration of tokenized securities by providing custody infrastructure, which management presented as evidence of institutions moving tokenized assets toward production use.

BitGo also announced that Reginelli will leave the CFO role during the coming quarter while remaining with the company to support the transition.

Recent insider transactions

The supplied insider dataset reports 99,573 shares acquired across seven transactions and 48,042 shares sold across four transactions over the last six months, resulting in net acquisitions of 51,531 shares. The latest disclosed records include sales by the CEO, CFO and COO, as well as derivative-security exercises; these transactions do not by themselves establish insiders’ views on the company’s outlook.

Risks investors should watch

• Transaction margin pressure: Digital Asset Sales revenue grew rapidly, but its margin fell to 17 basis points. Further spread compression or an unfavorable shift between gross-reported spot activity and net-reported derivatives could limit the earnings benefit from higher volume.
• Weak staking monetization: Normalized assets staked increased 36.1%, yet staking revenue declined 28.8% and the take rate fell to 6.0%. Continued client-mix or pricing pressure could keep staking economics subdued.
• Digital asset valuation volatility: The swing from a $55.8 million unrealized gain to an $18.8 million unrealized loss was the main reason net income reversed year over year. Future valuation changes could continue to create material earnings volatility.
• Cash conversion and cost execution: First-half operating cash outflow expanded to $36.2 million. The company must execute its planned annualized savings while preserving the investments needed to grow its platform.
• Leadership transition: The planned CFO departure creates an execution consideration as BitGo works to improve profitability, allocate capital and operate as a recently public company.

Summary

BitGo’s Q2 2026 results showed rapid growth in client activity, normalized platform assets and gross transaction revenue, but that expansion did not yet translate into stronger profitability. Narrower Digital Asset Sales margins, a lower staking take rate and digital asset valuation losses outweighed the benefits of higher activity. The main issues to monitor are whether the planned cost savings improve cash generation, whether transaction economics stabilize and whether institutional adoption produces more recurring, higher-margin revenue.