Gemini posts $108M Q2 net loss despite 37% revenue growth
Credit card and staking revenue drove Gemini’s services growth in Q2 as exchange revenue fell 38% and trading volume dropped by two-thirds.
Gemini, a cryptocurrency exchange, reported a net loss of $108 million in the second quarter despite a 37% increase in revenue. The decline in exchange revenue, down 38% to $12.5 million, was primarily due to a two-thirds drop in trading volume to $3.8 billion. However, services revenue surged 149% to $23.5 million, fueled by a 231% increase in credit card revenue amounting to $16.2 million and a 50% rise in staking revenue to $4 million.
Interest income contributed $26 million to the total revenue. The company's transaction losses soared to $20.1 million, up from $3.6 million a year ago, mainly because of a $16.1 million provision for credit losses attributed to an identity fraud incident involving their credit card portfolio. Despite the substantial losses, operating expenses increased by 24% to $122.4 million, although they fell 15% from the previous quarter as Gemini continued its cost-cutting measures.
Gemini's stock price increased by 3% during regular trading on Thursday but dipped nearly 5% in pre-market trading on Friday following the earnings announcement, according to Yahoo Finance data.
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