BitGo reported second-quarter revenue of $4.329 billion, a 79.6% jump from a year earlier, but the crypto custodian still ended the period with a $19.0 million net loss. The company's digital asset sales business generated $4.198 billion in revenue against $4.190 billion in direct costs, leaving a spread of just $7.1 million, or 17 basis points.
The math behind the revenue
Direct costs ate up 99.83% of Digital Asset Sales revenue in the quarter. That thin margin helps explain why BitGo recorded a $17.4 million operating loss despite the top-line growth.
The net loss included an $18.8 million unrealized loss on company-owned digital assets, partly offset by a $5.6 million disposal gain. BitGo's company-defined adjusted EBITDA was negative at $4.2 million.
Cost cuts and a shrinking headcount
Management announced cost actions expected to produce about $15 million in annualized cash savings. BitGo approved a reduction in force in June, recorded $1.3 million in restructuring charges, and said the plan was substantially complete.
The company didn't say how many employees were affected or which teams took the biggest hits.
CFO departure and a quiet buyback
CFO Edward Reginelli notified the board on Aug. 10 of his resignation, effective Sept. 15. He'll support the transition in an advisory role. BitGo didn't name a successor.
BitGo has a June authorization to repurchase up to $50 million of shares, but no shares were repurchased during the three months ended June 30. The company didn't explain why it held off.
What's left on the platform
Assets on Platform were $65.2 billion, down 27.8% on a reported year-over-year basis. But after repricing prior-period digital assets using current-quarter median prices, the figure is up 31.4%.
The gap between those two numbers shows how much of the decline is just crypto price movement rather than customers leaving.
Reginelli's last day is Sept. 15. The share repurchase authorization runs through June of next year. BitGo hasn't said whether it plans to use it.
