Bullish (BLSH) Earnings

Management highlights

- **Strategic Milestone: Tokenized Securities Trading** * Bullish, which marked the one-year anniversary of its NYSE IPO, launched trading of its own tokenized shares on its regulated venue, marking the first trades of any tokenized security on the platform and turning the tokenized securities infrastructure blueprint into a live product. * A October 27, 2026 showcase at the NYSE will demonstrate live tokenized equity issuance and trading, introduce new issuer and Layer 1 partners, and share a full first look at the firm's tokenization platform. * Management focuses on issuer-sponsored tokenization, where the token is the actual legal share recorded on the official register, distinct from synthetic third-party wrapped tokens; this model benefits issuers via direct visibility into share ownership, programmable corporate actions, and retained economics, and benefits investors via 24/7 trading, instant atomic settlement, fractional access, and direct issuer relationships. - **Equinity Acquisition Progress** * The acquisition of Equinity (the world's second largest transfer agent) remains on track to close in January 2027. All antitrust clearances are secured, and other regulatory approvals are advancing, with both firms already planning for combined operations post-close. * Equinity serves nearly 3,000 corporate issuers including half of the FTSE 100 and 30% of the S&P 500, serves over 20 million shareholders, processes over $500 billion in annual payments, holds 95%+ client retention with average multi-decade relationships, and operates five mission-critical recurring revenue connected services for public companies. - **Market Opportunity for Tokenization** * Tokenized on-chain real-world assets have grown 20-fold since 2024 to ~$37 billion, with stablecoin tokenized cash at ~$290 billion. Management views securities as the next major growth wave, representing a $270 trillion total addressable market; Citi projects $5.5 trillion in tokenized securities by 2030, which Bullish management considers conservative. - **Regulatory Update** * The U.S. Clarity Act market structure legislation did not advance in the current session, but Bullish's strategy does not depend on its passage. The SEC is expected to imminently publish an innovation exemption for tokenized securities, which management expects will validate issuer-sponsored tokenization and accelerate issuer conversations about tokenization.

Guidance

- Bullish narrowed its 2026 full-year SSNO revenue guidance to a range of $225 million to $245 million, maintaining the prior midpoint while narrowing the range on increased full-year visibility. Second half 2026 SSNO revenue is expected to split 45% in Q3 and 55% in Q4, driven by new signed partnerships coming online. - Adjusted 2026 full-year operating expense guidance is narrowed to $225 million to $230 million, with spending roughly evenly split between Q3 and Q4. Q2 2026 was guided as the peak quarterly adjusted operating expense for the year, with one-time Q2 costs to be offset by already realized H2 2026 efficiency gains. - Full-year 2026 finance expense guidance is maintained at $52 million to $60 million. Bullish does not guide adjusted transaction revenue, and directs investors to monthly trading metrics posted to its IR website. - Full-year 2026 financial guidance for Equinity and the medium-term combined business outlook are maintained as previously communicated.

Segment performance

Total adjusted revenue for Q2 2026 was $92.6 million, flat quarter-over-quarter and up 62% year-over-year. Subscription services and other (SSNO) revenue reached a record $62.7 million, accounting for 67.7% of total adjusted revenue. Adjusted transaction revenue was $29.9 million, accounting for 32.3% of total adjusted revenue. Adjusted operating expenses were $63.1 million, which management confirmed was the peak quarterly adjusted operating expense for 2026, driven by Consensus event costs and $2.5 million in one-time business transformation compensation expenses. Adjusted EBITDA was $29.5 million with a 32% margin, and adjusted net income was $14.3 million after $14.5 million in finance expenses. Bullish ended the quarter with $2.1 billion in net liquid assets. Key segment details: 1) Exchange: Spot trading volumes moderated in line with broader crypto market conditions, but the firm added major new institutional clients including a top global wealth manager as exclusive crypto trading provider for its Asia business, plus new partnerships with SoFi, BitGo Prime and others. The firm expects to gain access to the U.S. crypto derivatives market nearly a year earlier than previously planned, and has already partnered with retail broker-dealers and key market access providers. 2) Media & Events: Flagship Consensus conference drew 16,000+ attendees from over 100 countries, with over half of sponsorship revenue coming from multi-product clients. CoinDesk media grew 38% YoY in page views (adding 10 million page views in Q2) and 83% YoY in unique visitors, with growing market share. CoinDesk indices won new mandates including for Morgan Stanley's flagship Bitcoin ETP ($400 million AUM), Grayscale's Hyperliquid ETP, and additional Morgan Stanley Ethereum and Solana ETPs; lower crypto prices have held back index revenue growth despite market share gains. 3) Liquidity Services: Generated stable resilient recurring revenue in Q2, added new clients including being the first exchange to list SoFi's SoFiUSD stablecoin. Performance was broadly in line with Q1 after accounting for lower crypto price headwinds, with stronger new booking momentum in Q3.

Risks & headwinds

- The planned Equinity acquisition may not close, may not close on the expected timeline, may fail to obtain required remaining regulatory approvals, may fail to deliver anticipated strategic and financial benefits, and carries integration risks for the combined business. - Crypto trading volumes and transaction revenue are highly correlated to crypto prices and volatility, which have declined year-over-year, creating ongoing industry headwinds that cannot be forecasted with certainty. - Tokenized securities market development depends on regulatory clarity and industry adoption, which may progress slower than management currently expects. - Less than 2% of Equinity's current revenue is tied to UK paper share certificate processing, which will be eliminated by upcoming UK dematerialization; while management expects tokenization and new broker-dealer opportunities will more than offset this small revenue loss, there is still risk that any offset is lower than anticipated. - Forward-looking statements about future tokenization market growth, market access, and revenue contributions are inherently uncertain, and actual results may differ materially from current expectations.

Analyst Q&A

• Q: The analyst asks how synthetic and issuer-sponsored tokenized equity models will coexist in the future, and what the market split will look like. /

  A: Management confirms both models will coexist long-term, similar to how actual shares coexist with ETFs, ADRs, and structured products in traditional markets. Synthetic tokens are sufficient for small retail traders seeking short-term exposure, while large institutional fiduciaries will demand actual issuer-sponsored tokens that carry no third-party credit risk. Issuers will insist on issuer-sponsored tokens because only this model delivers direct benefits to issuers themselves.

• Q: The analyst asks for more detail on why U.S. crypto derivatives access is coming nearly a year earlier than expected, and how the new approval pathway works. /

  A: Originally, Bullish expected to need full approval for a domestic futures platform, clearinghouse, and FCM to access the U.S. market, a lengthy process. A new pathway has opened for compliant, regulated overseas platforms like Bullish, which already holds approval from multiple top global regulators: Bullish can access the U.S. market via a partnership with an approved domestic FCM. Management expects to complete the required steps over the next several months to gain unfettered U.S. access.

• Q: The analyst asks how Bullish will capture economics in an open, interoperable issuer-sponsored token model with multiple trading venues, rather than a closed walled garden. /

  A: Bullish is building for full interoperability across multiple venues, blockchains, and central securities depositories, and expects multiple blockchains to support tokenized securities in the early market. Bullish can capture revenue across multiple value-added touchpoints: token creation and consulting, listing and liquidity provision, visibility via CoinDesk and Consensus, transfer agent services, and additional issuer services including GlobeNewswire and investor relations tools. Management prioritizes supporting issuer success first, and expects transaction revenue to follow this value creation.

• Q: The analyst asks what factors could lead tokenized securities market size to exceed Citi's $5.5 trillion 2030 forecast, and which blockchains will lead the market. /

  A: Management notes the market is growing much faster than expected, with already active conversations with large-cap issuer CEOs about tokenizing their entire stock; just a handful of such large issuers would move total market size meaningfully higher. Management expects adoption will start slow then accelerate rapidly after a catalytic event like a large all-tokenized IPO, leading the entire market to shift toward tokenization faster than projected. Management expects the winning blockchains will be those that solve for both decentralization and privacy needs, and Bullish will support multiple leading blockchains to match issuer preferences.