BTCS — Q3 2026 Earnings Summary

Financial Performance:

• Total revenues increased 67% quarter-over-quarter to $4.1 million for Q3 2026, compared to $2.4 million in Q2 2026.
• Gross profit reached a record $3.5 million for Q3 2026, representing an 86% gross margin, a 134% increase from Q2 2026 ($1.5 million, 61% margin) and a 222% increase from Q3 2025 ($1.1 million).
• Year-to-date gross profit for the nine months ended September 30, 2026, reached $6.0 million, compared to $1.1 million for the same period in 2025.
• DeFi revenues (Imperium) increased 133% quarter-over-quarter to $3.5 million in Q3 2026 from $1.5 million in Q2 2026, comprising approximately 86% of total revenues.
• Blockchain infrastructure revenues (NodeOps and Builder+) decreased to $0.6 million in Q3 2026 from $0.9 million in Q2 2026.
• Net income for Q3 2026 was $54.5 million, compared to a net loss of $34.9 million in Q2 2026; results included $58.3 million in non-cash unrealized gains on digital assets and $3.6 million in realized gains, partially offset by a $5.7 million impairment loss on intangible digital assets.
• Total assets were $176.1 million as of September 30, 2026, compared to $89.3 million as of June 30, 2026.
• Total liabilities increased to $80.0 million as of September 30, 2026, from $50.4 million as of June 30, 2026.
• Loans payable to DeFi protocols were $63.0 million as of September 30, 2026, compared to $36.0 million as of June 30, 2026.
• Digital assets held in liquidity pool positions grew to $40.9 million as of September 30, 2026, from $7.6 million as of June 30, 2026.
• Common shares outstanding were 53.1 million as of September 30, 2026.
• The Company received net proceeds of approximately $1.5 million from sales under its At-The-Market (ATM) Agreement during Q3 2026.

Guidance and Future Outlook:

• The Company expects Imperium to remain the primary driver of revenue and gross profit through the remainder of 2026.
• Management intends to continue scaling Imperium and evaluating additional strategies and networks to further expand the business.
• Management views institutional adoption of digital assets and the tokenization of real-world assets as potential drivers for increased demand for on-chain liquidity.
• The Company anticipates that agentic AI could increasingly use on-chain rails to transact and make payments autonomously.

Business Segments and Product Lines:

• Imperium, the decentralized finance (DeFi) business, expanded its paired liquidity pool positions from approximately $8 million to approximately $41 million during the quarter.
• Imperium integrated Base, an Ethereum Layer-2 network, marking the business line's first expansion beyond Ethereum mainnet.
• The Company completed preparatory compliance steps for tokenized-equity liquidity provisioning under the SEC's Covered Firm exemption in September, though no capital has been committed to this activity yet.
• Blockchain infrastructure revenues, comprising NodeOps and Builder+, continue to be deprioritized in favor of capital and resource deployment toward Imperium.

Market and Competitive Landscape:

• Imperium operates across multiple networks to dynamically allocate liquidity where volume and demand shift.
• Management believes the multi-chain approach provides substantial room for growth in the on-chain economy.
• The Company faces competition in block-building, staking, and DeFi markets.

Risks and Challenges:

• Net income is significantly influenced by unrealized gains on digital assets, which may reverse in future periods.
• DeFi borrowings are collateralized by digital assets and may be subject to liquidation if collateral values decline.
• Risks include volatility in digital asset markets, concentration risk from the Ethereum-first strategy, and regulatory developments affecting digital assets and blockchain technology.
• Operational risks include smart contract vulnerabilities, DeFi protocol failures, counterparty risks, impermanent loss, and liquidity risks associated with DeFi lending and borrowing.
• There is a risk that the SEC's exemptive relief for tokenized-equity markets may be modified, withdrawn, or expire.
• Risks related to the Ethereum network and Layer-2 networks include fluctuations in transaction volumes, blockspace demand, and changes in network protocols or gas fee structures.

Management Commentary and Tone:

• CEO Charles Allen described the third quarter as a "breakout quarter" and noted that the Company surpassed its full-year gross profit target of $6 million with a full quarter remaining in 2026.
• CFO Michael Prevoznik stated that gross profit more than doubled quarter-over-quarter and emphasized the focus on scaling revenue and gross profit while managing the balance sheet with discipline.
• CTO Ben Hunter highlighted the integration of Base as a major milestone for the engineering team, providing access to another deep pool of on-chain activity.
• CEO Allen expressed optimism regarding continued institutional adoption and the potential for tokenization and agentic AI to expand the scale and scope of on-chain activity.

Other Key Points:

• The Company launched an updated corporate website and released an updated investor presentation and new company primer.
• The Company utilizes the "DeFi/TradFi Accretion Flywheel" strategy to raise capital, accumulate digital assets, and deploy them on-chain.
• The press release includes a detailed list of forward-looking statements regarding growth prospects, revenue expectations, and regulatory developments.