Securitize reported record average tokenized assets under management of $4.3 billion for the second quarter, up 16% from a year earlier, while total revenue fell 5% to $14.4 million and net loss widened to $21.7 million in the company’s first results released after it started trading publicly.
The numbers offer an early look at a question investors have been watching closely: whether growth in tokenized funds can be converted into revenue at Securitize. In the quarter, assets and transaction activity increased, but revenue from tokenization moved lower.
According to Yahoo Finance market data, Securitize shares fell about 16% in after-hours trading to $6.61 at 8 p.m. ET after closing Wednesday at $7.86.
Tokenization revenue fell even as assets rose
The decline in revenue came from Securitize’s tokenization business. Quarterly revenue in that segment dropped 12% to $7.8 million. Asset-servicing revenue rose 3% to $6.6 million, but that was not enough to keep total revenue above the year-earlier quarter.
Securitize said it added about $1 billion of tokenized assets during the quarter after declines in the prior two quarters. Aggregate transaction volume reached $5.3 billion, up 147% year over year.
Fund-services business moved the other way
The company’s fund-services segment showed the opposite trend. Assets under administration fell by about 20% to $24.3 billion as of June 30. Securitize said it was servicing 663 active funds at that date.
Operating costs climbed sharply
Total operating costs rose 56% to $24.1 million in the second quarter. Selling, general and administrative expenses increased 133% to $8.2 million, while compensation and benefits rose 31% to $10.5 million.
Operating loss expanded to $9.7 million from about $198,000 a year earlier. Adjusted EBITDA, which excludes several non-cash and other items, shifted to a $5.5 million loss from a $1.8 million profit. The GAAP net loss also reflected changes in the fair value of option, derivative and future-equity liabilities.
Quarter ended before the Cantor transaction closed
The reporting period ended before Securitize completed its combination with Cantor Equity Partners II on July 1. In its Form 8-K, the company said the results belong to Securitize I, the operating business before the transaction, rather than the post-combination public company.
Securitize began trading on the New York Stock Exchange under the ticker SECZ on July 2. Chief Financial Officer Francisco Flores said the combination left the company entering the third quarter with about $350 million in cash and no debt.
The company is scheduled to discuss the results on an earnings call at 8:30 a.m. ET on Aug. 13.