Galaxy's Earnings Beat Meets Lower Targets and a Helios Funding Test

Galaxy Digital's third-quarter rebound was strong enough to lift the shares, but not enough to stop several analysts from cutting price targets. The split reflects a company that has delivered earnings and construction progress while still asking investors to fund a large data-center expansion.

Galaxy reported $323 million of net income for the third quarter, reversing an $85 million loss in the second quarter. Adjusted earnings were $0.83 a share, adjusted gross profit was $569 million and adjusted EBITDA was $455 million. The board also authorized another $200 million of share repurchases.

Data centers made their first full-quarter contribution under the Helios Phase I lease. The segment produced $79 million of adjusted gross profit and $69 million of adjusted EBITDA, up from $20 million and $11 million in the second quarter. Galaxy said all 133 megawatts of critical IT load for Phase I had been delivered to CoreWeave.

Phase II is fully financed and under construction after a $3.5 billion senior secured note offering. Galaxy says work is on schedule and within budget, with the first data halls due in the second quarter of 2027. That progress reduces near-term construction funding risk, but it does not finish the Helios story.

H.C. Wainwright cut its target to $36 from $40 while keeping a Buy rating. Goldman Sachs lowered its target to $20.50 from $24 and kept a Neutral rating, calling the data-center result mixed despite a broad earnings beat. Compass Point also cut its target to $30 from $36 while maintaining Buy, citing a higher discount rate for the CoreWeave contract. Price targets are analyst estimates, not company forecasts.

The next two tests are financing and leasing. Management said it expects to pursue Phase III financing in the first half of 2027. Galaxy is also seeking tenants for 830 megawatts of approved Helios II capacity that is not yet leased. The company described market conditions as favorable, but discussions are not contracts.

Liquidity is substantial but partly committed to expansion. Galaxy ended the quarter with $4.9 billion of cash, stablecoins and U.S. Treasuries, alongside $3.0 billion of equity. It also had $445 million of exchangeable notes due in December 2026 and said it had sufficient resources to meet that maturity.

The earnings beat proves that Helios Phase I can contribute to reported results. The valuation question now depends on whether Galaxy can finance later phases on acceptable terms, sign creditworthy tenants and keep construction on schedule without eroding returns.