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BitGo revenue rises 79.6%, but direct costs consume nearly all sales
BitGo reported a $4.3 billion quarter of revenue, yet its Digital Asset Sales segment left only a $7.1 million spread after $4.190 billion of direct costs, with adjusted EBITDA still negative.
BitGo posted second-quarter revenue of $4.329 billion, up 79.6% year over year, but CryptoSlate said the company’s economics were dominated by transaction costs tied to its Digital Asset Sales segment.
In that segment, Digital Asset Sales generated $4.198 billion of revenue against $4.190 billion of direct costs, leaving a $7.1 million spread, or 17 basis points of segment revenue. CryptoSlate noted the company generally records Digital Asset Sales gross when it acts as principal, meaning the gross-presented component can look very different from net-style software revenue.
BitGo reported a $17.4 million operating loss and a $19.0 million net loss, including an $18.8 million unrealized loss on company-owned digital assets that was partly offset by a $5.6 million disposal gain. Its company-defined adjusted EBITDA also remained negative at $4.2 million, according to the earnings release and filings.
Management said it expects about $15 million in annualized cash savings and separately announced a reduction in force in June that led to $1.3 million in restructuring charges, with that plan described as substantially complete. BitGo also said CFO Edward Reginelli notified the board on Aug. 10 that he would resign effective Sept. 15, and that no share repurchases occurred under a June authorization for up to $50 million.