Twenty One Capital Q3 Earnings Call Highlights

Key Points

• Twenty One Capital reported $1.1 billion in Q3 net income, driven mainly by a non-cash fair-value gain on Bitcoin as its price rose. The company held 43,514 Bitcoin worth about $3.6 billion at quarter-end.
• CEO Rapha Zagury said the company will keep Bitcoin as its long-term reserve asset while building or acquiring cash-generating businesses in areas such as mining, lending, treasury and energy.
• The company ended the quarter with $102.8 million in cash and $486.5 million in convertible notes. A potential Elektron mining-assets transaction remains under independent audit-committee review, with no definitive agreement signed.

Twenty One Capital NYSE: XXI reported approximately $1.1 billion in third-quarter 2026 net income, driven primarily by an increase in the fair value of its Bitcoin holdings, while executives outlined plans to build cash-generating businesses around the cryptocurrency.

The result compared with a net loss of approximately $413 million in the second quarter. Chief Financial Officer Steve Meehan said the company recorded an approximately $1.1 billion gain from the change in fair value of its Bitcoin during the third quarter. Those valuation changes do not themselves generate or use cash, he said.

Chief Executive Officer Rapha Zagury said Bitcoin would remain the company’s long-term reserve asset, but that its next task is to develop earnings power from operating businesses. “Owning Bitcoin is where we start, but now building earnings power is the job,” he said.

Bitcoin Holdings and Expenses

Twenty One held 43,514 Bitcoin at Sept. 30, unchanged from the end of June. Their quarter-end fair value was approximately $3.6 billion, with Bitcoin valued at approximately $83,700 per coin, up from approximately $58,600 at June 30.

For the first nine months of 2026, the company recorded a $156.4 million loss from changes in Bitcoin’s fair value and a net loss of $186.5 million. Its Bitcoin Per Share metric rose to 12,553 satoshis from 12,547 at the end of the second quarter.

Third-quarter operating expenses fell to $4.8 million from $10.7 million in the preceding quarter, primarily because stock-based compensation declined to $900,000 from $7 million. Meehan said the change essentially reflected the former CEO’s departure in July.

Operating expenses for the first nine months totaled $26.1 million, including $13 million in stock-based compensation and approximately $13 million in cash expenses. Net cash used in operating activities was $1.7 million for the third quarter and $13.3 million for the nine-month period.

Acquisition Plans and Elektron Review

Zagury said Twenty One is evaluating opportunities in mining, lending, treasury and energy, but has passed on some potential deals because their economics or terms did not work. The company wants businesses that can generate cash after operating costs, equipment maintenance and financing obligations, including when Bitcoin prices are flat.

Those funds could eventually support additional Bitcoin purchases or investments without the company needing to return to capital markets each time, he said. Zagury added that every acquisition must compete with holding Bitcoin as the company’s long-term benchmark.

Asked about the potential Elektron transaction involving mining assets, Zagury said the company had not signed a definitive agreement. Its audit committee is conducting an independent review and has engaged legal and financial advisers, he said. He declined to discuss valuation metrics or transaction structure.

Twenty One also wants to build or buy Bitcoin-backed lending capabilities and is actively evaluating opportunities, Zagury said. He described governance and team-building as the company’s most visible areas of progress, citing the addition of three independent directors and hires in finance, technology and communications.

Debt, Liquidity and Buybacks

The company ended the quarter with $102.8 million in cash and $486.5 million in convertible notes outstanding, unchanged from the prior quarter. The notes carry a 1% coupon and mature in 2030. Approximately 16,116 Bitcoin were pledged as collateral, while approximately 27,398 were unencumbered and unpledged.

Meehan said debt obligations, liquidity requirements and other commitments affect how much capital the company can prudently deploy. When deciding how to settle note conversions, Twenty One would weigh preserving cash against dilution from issuing shares, he said. Selling Bitcoin to fund a settlement would not be the preferred path.

Executives also addressed questions about repurchasing shares and liquidating the company. Meehan said buybacks deserve serious consideration when shares trade below the value of the assets attributed to them, but any repurchase would be subject to liquidity, approvals and applicable restrictions. Zagury said the company takes the discount seriously but believes its long-term use of the balance sheet is to build and acquire cash-generating businesses.

Looking ahead, Zagury said he expects meaningful progress over the next 12 months in operating businesses, capital markets and lending. “A balance sheet is not a business,” he said.

About Twenty One Capital (NYSE:XXI)

Twenty One Capital is a Bitcoin-focused company that aims to build its business around Bitcoin and its broader financial ecosystem. Its activities include holding Bitcoin as a corporate treasury asset and developing Bitcoin-related financial and capital-markets services. The company was formed with backing from Tether, Bitfinex, SoftBank and Cantor Fitzgerald and became publicly traded through a business combination with Cantor Equity Partners. Jack Mallers, founder and chief executive of Bitcoin payments company Strike, was named Twenty One Capital's chief executive.

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