Antalpha Q1 2026 Earnings Call - Record 0 Loss Amid 52% Revenue Growth and Strategic Pivot to AI and Yield

Operator: Good day, and thank you for standing by. Welcome to Antalpha’s first quarter 2026 earnings conference call. Today’s call is being recorded. All participants are now in a listen-only mode. After management’s prepared remarks, there will be a question-and-answer session. I would now like to turn the call over to Chris Mammone, Managing Director of The Blueshirt Group and representative for Antalpha’s Investor Relations team. Mr. Mammone, please go ahead.

Chris Mammone, Managing Director, The Blueshirt Group / Antalpha Investor Relations: Thank you, operator. Welcome to everyone participating in this call. Joining me today is Paul Gong, Antalpha’s Chief Financial Officer. Please note the following. First, all year-over-year comparisons in today’s call are for Q1 2026 versus Q1 2025, unless otherwise stated. Second, consolidated financial statements, including Aurelion, began from Q4 2025. As such, Q1 2025 comparative figures reflect Antalpha’s stand-alone results. Third, our remarks today will include forward-looking statements based on current expectations. These statements involve risks and uncertainties that could cause actual results to differ materially. For discussion of these risks, please refer to Antalpha’s filings with the SEC. We do not undertake any obligation to update forward-looking statements except as required by law. This call also contains references to unaudited non-GAAP financial measures. Reconciliations to the most comparable GAAP measures can be found in our press release and SEC filings.

Now I’ll turn the call over to Paul Gong, who will provide the Q1 operating and strategic overview, as well as the financial highlights and outlook. Paul, please go ahead.

Paul Gong, Chief Financial Officer, Antalpha: Thanks, Chris. Good day, everyone. Thank you again for joining us. I’m Paul Gong, CFO of Antalpha. Let me start with a brief framing of the quarter. Q1 10, 2026 was a period of solid execution and business development for Antalpha, amid of a dynamic and challenging market backdrop for the crypto ecosystem. We delivered 52% year-over-year revenue growth and maintained our record of 0 principal loss. At the same time, our loan book saw a 1-time reduction driven by substantial repayments from certain large borrowers, which notably Canaan Inc. I will address this in detail, but the key point is all borrowers repay with no loss of principal. We view it as a strong reflection of our borrowers’ overall financial health and the soundness of our credit model.

Finally, we also want 2 important strategic growth initiatives, the beta launch of our Web3 AI agent and the transition of our tokenization gold holdings into yield-generating deployment. I want to provide some extra context on the Canaan repayment before moving to the loan book. On the large borrower Canaan’s, Canaan repayment, I want to provide some extra context here before the financial results section. During the first quarter and into early quarter 2, Canaan Inc, a NASDAQ-listed Bitcoin miner, has repaid approximately $530 million of its outstanding loan balance. This represents over 95% of Canaan’s outstanding balance as at December 31, 2025. Canaan funded the repayment through a combination of publicly disclosed Bitcoin asset sales and equity transactions. This is the type of positive outcome of that our credit model is designed to produce.

We were pleased with how it all played out in practice. I will now cover our loan book update and risk management activities, followed by our strategic initiatives, walk through the rest of the financials and close with our Q2 outlook. Antalpha’s operating philosophy is a risk management-first philosophy. We have been consistent in this approach since our inception, and it’s central to how we manage the platform in Q1. Bitcoin prices were under considerable pressure in Q1, declining approximately 40% from their October 2025 peak. In this familiar environment, our approach was deliberate. We maintain active dialogue with every client to review market conditions, stress test positions, and discuss their options as we do in our daily operation, especially every period of price volatility. We do not simply wait for the market to move. We engage proactively.

Our overcollateralization model continued to underpin the loan book. We require overcollateralization at origination, and Bitcoin mined by client is deposited directly into our wallets, allowing the collateral pool to build continuously. The result of this approach is a proven track record we are proud to stand behind. As of March 31st, 2026, Antalpha has recorded no loss of principal since the inception of the company, and it is the direct outcome of the prioritization of risk management above all else amidst every market bad job. Before reviewing our loan book matrix, let me provide some broader market context. We just discussed the devaluation of Bitcoin versus the October 2025, which created a more cautious environment for new loan deployment and borrowers’ activity.

While the near-term sentiment for digital assets has been softer and the long-term demand backdrop remains constructive, spot BTC ETF assets under management stood at approximately $102 billion as of mid-May 2026, reflecting continued institutional participation in the asset class. Historically, periods of price softness have been also coincide with increased interest in machine upgrade financing as miners began positioning for the next cycle. We expect this dynamic to once again support the loan demand as market conditions stabilize. With that context, let me walk through the loan book matrix and in detail, starting with TVL per client, which I think it gives the clear picture of the underlying business. TVL per client increased 36% year-over-year, reflecting growth in average loan size across the client base and the continued deepening of our client relationships.

This growth stems from our proactive strategy to prioritize lower-risk consumers, ensuring a higher quality portfolio. Total value of loans were $1.6 billion as of March 36, 2026, was down 3% year-over-year. This change reflects three factors. First, more measured new loan deployment in a weaker Bitcoin price environment. Second, substantial one-time loan repayment from two large borrowers, mostly from Canaan, which we mentioned earlier, which repay approximately $510.6 million during the 1st quarter of 2026. Third, a modest reduction of approximately 3% in the remaining portfolio on a sequential basis. It is worth re-emphasize that we have never had a credit loss. We have never had a loss on principal across the entire loan book. We enter the recovery phase of the cycle with a well-protected portfolio.

As market conditions stabilize, we are positioned to redeploy capital and grow the loan book. Hash rate loans finance approximately 44.2 exahash of hash rate capacity as of March 31st, 2026, representing approximately 3.3% of global hash rate. This compares to 81.3 exahash, EH, as of December 31st, 2025. The decrease was mainly attributable to Canaan’s repayment, as Canaan’s facility were predominantly hash rate backed loans. In summary, the overall health of our loan book remains quite sound. Shifting gears now to our strategic initiatives, let me cover our Web3 AI agent first, followed by our tokenization goal update. In May 2026, Antalpha launched a Web3 AI agent in public beta.

I want to take some time discussing this initiative because we think it is important for the market to understand what we are building, why we are building it now, and how it interconnects into the core of Antalpha. Nina is an early stage of Web3 AI agent and part of Antalpha’s broader innovation into AI-driven infrastructure. It is built on our proprietary in-house MCP or Model Context Protocol framework, which is designed to support intelligent routing and coordination across data and execution environments. As it is core, Nina reflects our view that the next generation of digital infrastructure should make AI and Web3 more intuitive for users to engage with. As AI becomes more deeply embedded in financial and digital system, users will need an intelligent interface that can help them navigate increasingly complex blockchain-based environment with greater confidence and convenience. Why now?

Three factors come together to make this the right time to introduce a new solution like this. First, the capability of AI models to interpret natural language and reliable translate it into on-chain execution has only recently reached a level where user-facing product is viable. The technical barrier that previously required developer knowledge to interact with blockchain networks can now be adjusted through AI. That barrier has been broken. Second, there’s no established market leader in Web3 AI today, particular in Asia Pacific region. We see a clear opportunity to build a scalable solution that is available now. Third, and I want to be specific about this, Nina is further leveraging the domain it knows best. We have built a deep operational knowledge of Web3 infrastructure on-chain data and blockchain system through years of running our financing platform.

Our interconnection within the Bitcoin mining ecosystem give us a unique foundation in the space that other new entrants to Web3 AI does not possess. We are applying existing capabilities and relationships to an adjacent market. Next, I will talk about the tokenization goal. As of March 31st, 2026, NRPA held 39,371 units of XAUT. In Q1, we recognized $12.9 million in unrecognized fair value gains on these holdings. In April, subsequent to the quarter end, we took the next step in our tokenization growth strategy by committing 6,052 units of XAUT to the XAUE yield protocol. Aurelion, our subsidiary, separately committed another additional 10,000 unit to the same protocol.

This is the first deployment of our XAUT holdings into a yield-generating arrangement, which represents a meaningful transition from holding XAUT as treasury and balance sheet asset to actively deploy to generate yield. Now, let’s move to discuss our financial performance in the first quarter. Total revenue was $20.7 million in Q1 2026, up 52% year-over-year, reflecting a continual growth in both our key revenue components. Technology financing fees on supply chain loan were $50 million, up 49% year-over-year, driven by continued strengthen in our hash rate loan portfolio. Technology platform fees on margin loan were $5.7 million, up 62% year-over-year, reflecting healthy take rates and continued utilization of our margin loan facilities. The net fee margin increased 21 basis points year-over-year, reflecting price discipline across the platforms.

The expansion was led by our margin loan business, where net fee margin improved year-over-year and remained healthy on a sequential basis. Our supply chain loan net fee margin saw a modest year-over-year decrease, driven by a higher proportion of hash rate loans within the portfolio. Hash rate loans carry a lower branded rate than machine loan, and as the mix shifted towards hash rate loan through the period, it created some downward pressures on the branded supply chain loan margins. Let’s turn to operating expense and profitability. Total operating expense, excluding unrealized gain of crypto assets, were $25 million in Q1, up 102% year-over-year. This includes funding costs of $10.4 million, one-time restructuring charges of approximately $3.3 million, and non-cash equity-based compensation of approximately $1.3 million. Excluding these two items, non-GAAP operating expense were $20.4 million.

On funding costs, at 79% of technology financing fee on supply chain loans, funding costs increased modestly from 65% in Q1 2025. For additional context, funding costs were 70% of technology financing fee in Q4 2025. The sequential improvement reflects a reduction in the long base following a substantial repayments received in the period. Turning to profitability, GAAP operating income was $6.6 million, representing an operating margin of 32%. This was mainly reflects $10.9 million unrealized fair value gain from XAUT holdings flowing through our operating results. Non-GAAP operating income, which exclude one-time restructuring costs and non-cash ESOP expense totaling $4.6 million, was $11.2 million, representing a non-GAAP operating margin of 54%. Net income attributable to Antalpha was $2.7 million in Q1 2026 compared to $1.5 million in Q1 2025.

As a reminder, Q1 2025 reflects Enova’s standalone result as consolidation of Aurelion began in Q4 2025. Adjusted EBITDA was $13.3 million, representing an Adjusted EBITDA margin of 64% compared to 18% in the prior year period. This includes approximately $12.9 million in unrealized gain on the fair value of XAUT holdings. Excluding XAUT related gains, Adjusted EBITDA was approximately $0.4 million, with a margin of approximately 2%. The consolidated result I just walked through include contribution from both Antalpha Prime, the lending business, and Aurelion. To give investor a clear picture of each component, let me briefly separate them before turning to the valuation framework. Antalpha Prime, our core lending platform, generated standalone revenue of $20.7 million, up 52% year-over-year.

Standalone adjusted EBITDA of $4.4 million, a 77% improvement from $2.5 million in Q1 last year. Standalone GAAP operating loss was $2.3 million, including the $3.3 million one-time restructuring cost and $900,000 non-cash ESOP compensation in the period. If we exclude that charge, standalone operating income was approximately $1.9 million, compared with $1.5 million in the first quarter of last year. The EBITDA is 12% for standalone Antalpha Prime lending business. Aurelion contributed to the remaining $9.3 million of operating income at the consolidated level, driven by entirely by XAUT fair value gains. With that separation established, let me now turn to Aurelion’s result and our sum of parts valuation framework. Turning to Aurelion’s balance sheet.

As of 31st March 2026, Aurelion’s NAV was $116.4 million or $3.16 per share, reflecting 33,318 units of XAUT value at $4,667 per unit, net of $41.2 million in debts. Consistent with prior quarters, Enova’s 42% economic interest in Aurelion represents approximately $47 million of attributable NAV. Deducting this from Enova’s market cap of $206 million based on last Friday’s closing price, implied value of Enova’s core lending platform is approximately $169 million or approximately 1.9x of trailing 12 months revenue of $86.8 million and 11.7x trailing 12-month net income attributable to Enova’s $14.5 million.

Aurelion’s value is tied to gold appreciation and its XAUT treasury strategy. Antalpha Prime’s core platform value reflects the lending business fundamentals. We present this framework so investor can better assess each on its own terms. Turning to outlook. We expect second quarter 2026 revenue between $11 million and $13 million, excluding the impact of The single customer can go. The year-over-year decline will be between 7%-22%. The main driver of this sequential change from Q1 is the reduction in our interest-bearing loan base following the one-time repayment received in early 2026. Importantly, net fee margin and operating margin are expected to remain broadly stable quarter-over-quarter. New loan deployment activity was limited in February through April period, reflecting market conditions.

We remain engaged with existing and prospective clients on new loan deployment opportunities, and we’ll provide updates as the loan book develop. Our guidance reflects the strong visibility we have in the business and assumes continued demand for crypto-collateralized financing in the market environment. Further consistence what we see today. As always, actual results may differ from our expectation, and we will provide updates on our next quarterly call as appropriate. Now let me close with our 3 priorities for 2026. First, risk management. We will continue to apply disciplined collateral management and maintain active client dialogue through what remains a volatile market environment. Our 0 loss of principal record reflects the way we have run this business since inception. Second, core lending growth. TVL per client growth of 36% year-over-year reflects the quality and engagement of our client base.

We are actively re-deploying capital, and remain focused on growing the loan book with the right clients. The demand for crypto-collateralized financing is intact, and we are well positioned to continue to grow. 3rd, additional strategic growth curves. Our tokenization growth strategy is advancing. XAUT is now deployed into yield-generating protocols, which is a meaningful step forward. Our Web3 AI agent launched this month, applying our Web3 domain expertise to an adjacent market where we see a clear scaling opportunity. Both initiatives are at a very early stage, and we look forward to updating investors as they develop. With that, let me open the call to Q&A. Operators, please go ahead.

Operator: Thank you. To ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. Our first question comes from the line of Devin Ryan from Citizens Bank. Please go ahead. Your line is open.

Noah Katz, Analyst, Citizens Bank (on behalf of Devin Ryan): Hey, team. This is Noah Katz on for Devin. Thanks for the questions.

Paul Gong, Chief Financial Officer, Antalpha: Hi, Noah.

Noah Katz, Analyst, Citizens Bank (on behalf of Devin Ryan): Lots of developments here to dive into. First, just want to touch on your announced further expansion into AI infrastructure with the Web3 AI agent, Nina. Can you help us unpack this a bit more and tell us why Nina is the right product for your AI strategy? Should we think of Nina as a user acquisition tool and a way to deepen engagement with your clients, or as more of a foundational piece for future AI revenue streams? Thank you.

Paul Gong, Chief Financial Officer, Antalpha: Yeah. Thanks, Noah. Thanks for the question. I think firstly, we believe LLM has become the next generation of entry point. I think now we are turning to I mean, all the users interact with like digital world basically through AI to some extent. This shift kind of create a meaningful vary, value, especially in the AI industry. As today, the Web3 users experience remain highly fragmented. Users often need to move across like multiple wallets, protocols, data source, analytical tools. It’s a little bit complicated sometimes, if they do this on their own, especially for those like the new users.

We do think that it’s a very highly attractive vertical opportunities for us here in the Web3 area. Yeah, I think it’s very difficult for most of the users to navigate around, so this create a very strong user case for AI-native products. We understand the pain point of the users, and Nina is basically designed to bridge this gap, and it provides a neutral, like, natural language interface to help the users to access Web3 information and services.

The goal, our goal is to lower the barrier to Web3 participants to support a broader adoption. We do think that Antalpha is kind of unique, have some unique competitiveness advantages. Firstly, we develop our own MCP framework, which give us a greater control over the underlying connection between user status and Web3 environments. Over time, this could become a important platform-level capability. The second, Nina addresses a real pain point, as mentioned just now in the Web3. Instead of requiring users to set up and manage a lot of different tools separately, Nina basically provide a simpler and more integrated experience. The third, Antalpha has accumulated deep knowledge through the years operating in this area.

in this ecosystem. We understand data, the workflow, the user needs, and operational complexity of the market, which gives us a very strong foundation to build a differentiated AI product for Web3. Looking ahead, I think the first priority for us is to continue to strengthen the function of Nina across kind of like the data infrastructure model adoption. I think we are kind of also, we have been knowing this industry quite well, right? We have also a lot of connection with our miners. I think it’s easy for us to get some to have, like, the resources of the computing power to support our growth. I believe that give us a kind of unique competitiveness in this also.

In terms of revenue, I think this is not our priority at this moment. I think we will spend more some time to understand the needs of the user. I think firstly, I think we need to accumulate some meaningful users before we talk about monetization. I hope this helps.

Noah Katz, Analyst, Citizens Bank (on behalf of Devin Ryan): Yeah, that was very helpful. I was gonna dive into maybe what differentiates Nina from other Web3 AI agents. I think you answered it, unless you have anything else you want to add there.

Paul Gong, Chief Financial Officer, Antalpha: Yeah, that’s.

Noah Katz, Analyst, Citizens Bank (on behalf of Devin Ryan): Okay.

Paul Gong, Chief Financial Officer, Antalpha: Not really. I mean, compared with the other AI agent, I think, I mean, nowadays, you can find a lot of like generic ones, right? In terms of Web3, there’s not a specific product at this moment. We do think some startups are doing, are exploring, we think that we are a listed company. We understand the industry well. I think we are in a very good position to, well, to promote this, the Nina, the AI agent product. Definitely, there’s a lot of like general products outside. People use it a lot, it’s not specifically for Web3 users.

Noah Katz, Analyst, Citizens Bank (on behalf of Devin Ryan): That’s helpful. Thank you for answering my questions there. If I could sneak one more in, I want to touch on updates on the Clarity Act as it stands today. How are you thinking about the opportunity for Antalpha if digital asset rules become clearer and more defined, and could clearer rules change the pace at which you continue to scale? Thanks.

Paul Gong, Chief Financial Officer, Antalpha: Thanks. I think, it’s not that I mean, at this stage, I think, definitely we need to take a second look, I mean, a deeper look on how it impacts. Based on my understanding right now, it doesn’t affect that much. From our side, we are basically connecting, we are in the kind of like infrastructure level. We provide financing to the miners and it will not create a lot of impact on us at this moment. Definitely, with a more clarity on the regulation level, it helps basically the whole ecosystem or the whole stack base to develop.

Definitely it’s gonna help us also to some, I mean, to some extent in a broader level.

Noah Katz, Analyst, Citizens Bank (on behalf of Devin Ryan): Thank you.

Paul Gong, Chief Financial Officer, Antalpha: Thanks, Noah.

Operator: Thank you. We’ll now move on to our next question. Our next question comes from the line of Ed Engel from Compass Point. Please go ahead. Your line is open.

Ed Engel, Analyst, Compass Point: Hi, thanks for taking my question. I just wanted to drill down quickly on the impact of the Kangal loan payment. Did the entire $500 million get paid off in the first quarter, or was some of the impact also in the early second quarter?

Paul Gong, Chief Financial Officer, Antalpha: Yeah, I think mostly it’s paid in the first quarter. I think we mentioned roughly like just a small portion was repaid in April, the second quarter.

Ed Engel, Analyst, Compass Point: Great. Thanks for that. On the XAUT yield generation, deployment, just kind of curious, can you just give more color on, I guess, how those tokens are generating yield and then just like the expected, yield or target yield that you’re hoping for that allocation? Thanks.

Paul Gong, Chief Financial Officer, Antalpha: Okay. For the yield generation, basically, the foundation, issuing the XAUT, they have some kind of like very conservative investment opportunities, using the existing XAUT, which we base on our estimation at this moment is roughly between 1%-2%. It’s not that much, anyway, it’s a kind of a step forward comparing with the pure holding of XAUT in the past.

Ed Engel, Analyst, Compass Point: Great. Thank you for the color.

Operator: Thank you. We’ll now move on to our next question. Our next question comes from the line of Dylan Hines from B. Riley Securities. Please go ahead. Your line is open.

Dylan Hines, Analyst, B. Riley Securities: Hey, thanks for taking the question. I’m just wondering, on top of Kangal, do you expect any other repayments, you know, coming up? I just have a follow-on question after that.

Paul Gong, Chief Financial Officer, Antalpha: I think the loan balance at the smallest moment is roughly $40 million. We don’t anticipate any repayment at this moment, but we never know. Anyway, the impact will not be significant since the balance has been reduced significantly compared with the previous quarter.

Dylan Hines, Analyst, B. Riley Securities: Got you. Thank you. I was wondering, you mentioned an initiative in the Asian Pacific. I was wondering if you could go over again what you were talking about there.

Paul Gong, Chief Financial Officer, Antalpha: Can you kind of ask the question again?

Dylan Hines, Analyst, B. Riley Securities: Yeah. There’s an initiative you’re talking about in Asia Pacific regarding blockchain operators. I was wondering if you could go over that again. Missed that.

Paul Gong, Chief Financial Officer, Antalpha: You mean the AI agent or any other initiatives we talk about?

Dylan Hines, Analyst, B. Riley Securities: I’m not sure. You said something about Asian Pacific. Maybe I’ll have to go over it again, but okay. Nothing else for me then. Thank you.

Paul Gong, Chief Financial Officer, Antalpha: Okay, thanks. Thanks, Dylan.

Operator: That concludes the questions and answers period. Thank you again for joining our call today. You may now disconnect.

Paul Gong, Chief Financial Officer, Antalpha: Thank you. Thank you.