Key Takeaways:
Bullish reported Q2 revenue of $92.6M, beating consensus by $2.4M, as its tokenized shares began trading on its regulated venue for the first time.
"Tokenization of securities sits at the heart of our strategy," CEO Tom Farley said on the earnings call Thursday. "This is just the beginning."
Adjusted EBITDA came in at $29.5M at a 32% margin, while adjusted net income reached $14.3M after finance expense of $14.5M. Subscription services and other revenue hit a record $62.7M, up 62% year over year, while adjusted transaction revenue was $29.9M. GAAP EPS of $0.10 missed consensus by $0.01, and a $280M Bitcoin write-down pushed the net loss to more than double the year-ago period.
The company narrowed full-year 2026 guidance, expecting SS&O revenue between $225M and $245M and adjusted operating expenses of $225M to $230M. Finance expenses are expected at $52M to $60M. Management said second-half SS&O revenue would split roughly 45% in Q3 and 55% in Q4, driven by new partnerships coming online.
Total trading volume missed consensus estimates as industry volumes contracted with lower crypto volatility. Management said it reduced trading incentives in Q2 and prepared its U.S. readiness plan, while adding new institutional customers including SoFi, Berenberg, Bit2Me, and BitGo Prime. One of the largest global wealth managers selected Bullish as the exclusive crypto trading provider for its Asia business.
Bullish's pending acquisition of Equiniti Group, the second-largest transfer agent globally, remains on track to close in January 2027. Equiniti maintains share registers for nearly 3,000 corporate issuers, including roughly half of the FTSE 100 and 30% of the S&P 500, serving more than 20 million shareholders. The deal gives Bullish direct issuer relationships for its tokenization strategy, which management contrasts with synthetic tokens that wrap claims on shares held elsewhere.
The exchange also expects to gain access to the U.S. derivatives market in the next several months, nearly a year earlier than previously anticipated, through a new regulatory pathway involving an approved FCM. Management called the U.S. the largest global derivatives market.
CoinDesk, Bullish's media arm, saw page views rise 38% year over year with unique visitors up 83%. Morgan Stanley chose CoinDesk indices as the benchmark for its Bitcoin ETP, which has reached roughly $400M in assets, and launched Ethereum and Solana ETPs in late July.
Shares rose approximately 1.5% to $24.99 in pre-market trading. The stock trades at $24.52 with an average analyst price target of $44.70, implying 82% upside. The SEC is expected to publish an innovation exemption for tokenized securities in the coming weeks, which management said could accelerate issuer conversations.
The narrowed guidance shows management expects continued resilience in recurring revenue despite a soft crypto environment, with Bitcoin down roughly 50% from a year ago. Investors will watch the October 27 tokenization showcase at the NYSE for new issuer and Layer 1 partners.
This article is for informational purposes only and does not constitute investment advice.
