BitGo Q2 Revenue Jumps 80% but Swings to $19M Loss on Digital Asset Writedown
BTGO is trading near its 52-week low of $4.665 (4.0% above the low).
Summary
BitGo reported Q2 revenue of $4.33 billion, up 80% year-over-year, driven by higher digital asset sales. The company swung to a net loss of $19 million, or $0.16 per share, reversing a prior-year profit, primarily due to an $18.8 million unrealized loss on digital assets compared with a $55.8 million gain a year earlier. Adjusted EBITDA was negative $4.2 million. BitGo expects about $15 million in annualized cash savings from operating model changes and did not provide specific guidance. This follows a $50 million share repurchase program announced in June and a 15% workforce reduction in late June. The stock trades near its 52-week low of $4.665, and the median analyst price target of $15 implies significant upside, but the swing to losses and negative EBITDA amid falling asset prices will likely pressure the shares.
Updates
· Cointelegraph — Shares fell 1.8% in overnight trading to $4.90 after closing up 0.6% at $4.99. CEO Mike Belshe said performance fell short of expectations, citing lower margins from reduced spot spreads and a smaller derivatives contribution.
· SEC 10-Q — The 10-Q discloses unremediated material weaknesses in internal control over financial reporting.
At the time of this announcement, BTGO was trading at $4.85 on NYSE in the Crypto Assets sector, with a market capitalization of approximately $578.6M. The 52-week trading range was $4.67 to $24.50. This news item was assessed with negative market sentiment and an importance score of 8 out of 10. Source: Reuters.