Bullish (BLSH) Earnings

Management highlights

### Strategic Acquisition of Equinity - Announced a definitive agreement to acquire 100% of Equinity, a leading global regulated transfer agent, for $4.2 billion: $2.35 billion in newly issued Bullish ordinary shares plus assumption of $1.85 billion in existing Equinity debt, with closing targeted for January 2027 subject to customary regulatory approvals. - The acquisition creates a transformative end-to-end tokenization infrastructure platform bridging traditional finance (TradFi) and blockchain, addressing the core requirement that only a transfer agent working directly with issuers can create legally recognized tokenized shares (all third-party tokenization creates synthetic assets with counterparty risk). - Equinity is the transfer agent of record for nearly 3,000 public company issuers (including over 50% of the FTSE 100 and 30% of the S&P 500), serves 15,000 total corporate clients, has 20 million KYC-verified shareholders on its platform, processes over $500 billion in annual dividend payments, and operates in a high-barrier duopolistic market with 99% average client retention and 15+ year average client tenure. - Inbound interest from issuers, financial firms, technology partners, and regulators in the 9 days post-announcement has already exceeded management expectations, with dozens of inquiries from issuers seeking to tokenize their shares. ### Core Business Operational Progress - Exchange business: Q1 Bitcoin options volume reached $11.6 billion, growing open interest share to 14% of the global Bitcoin options market, making Bullish the clear #2 global Bitcoin options exchange; April saw a single-day volume high of $858 million, with new client wins including Ripple Prime and QCP. - Licensing progress: Filed for U.S. DCM (Futures and Options Exchange) and DCO (Clearinghouse) licenses, with a broker-dealer license filing expected in May 2026; on track to receive required European and U.S. securities trading licenses by the end of 2026, enabling expansion of derivatives products to the U.S. market. - Media and Indices: CoinDesk total page views grew 30% quarter-over-quarter, monthly unique visitors grew 60% quarter-over-quarter, and April 2026 visits were 82% higher year-over-year; CoinDesk Indices serve as the benchmark for Morgan Stanley's newly launched $220 million AUM BTC ETP (MSBT), with upcoming ETH and Solana ETP benchmarks coming soon, leveraging Morgan Stanley's $7 trillion wealth management platform. - Events: Q1 Consensus Hong Kong and Q2 Consensus Miami drew a combined 26,000+ attendees from over 100 countries, with Miami net ticket sales 120% higher than the prior Toronto event.

Guidance

- Management reaffirms all previously provided full year 2026 guidance ranges for Bullish standalone. - Full year 2026 adjusted operating expenses are expected to land between the midpoint and upper end of the prior guided range, as the company pulls forward tokenization platform investment; this elevated spend will be offset by $25 to $50 million in net cost reductions post-close of the Equinity transaction in early 2027. - Q2 2026 is expected to be the highest quarterly expense level of 2026, driven by spending on the recently completed Consensus Miami event. - Pre-synergy combined 2026 results for Bullish + Equinity are projected: adjusted total revenue of $1.25–$1.35 billion, adjusted EBITDA less capex of $490–$530 million, and adjusted net income of $270–$290 million. - Medium-term outlook (through 2029): 6–8% annual revenue growth, $25–$50 million in net cost synergies, adjusted EBITDA less capex growth of ~$100 million per year, ~$1 billion in cumulative free cash flow, and a 50% adjusted EBITDA less capex margin by the end of 2029.

Segment performance

Bullish reports total adjusted revenue of $92.8 million for Q1 2026, a 49% increase year-over-year, with slight sequential growth across all revenue lines despite a 24% quarter-over-quarter drop in Bitcoin prices. Subscription services and other revenue (SSNO) was flat sequentially at approximately 30% of total revenue, as growth from the smaller-scale Q1 Consensus Hong Kong event offset headwinds from depressed digital asset prices, lower interest rates impacting stablecoin revenues, and the discontinuation of non-priority legacy liquidity services. Adjusted operating expenses totaled $57.7 million, up $9.5 million from Q4 2025: $7 million of the increase was tied to the Consensus Hong Kong event, $1.25 million to AI tool investments, with the remainder split between additional employee costs and targeted performance rewards. Adjusted EBITDA came in at $35.1 million, representing a 38% margin, up from $13.2 million (21% margin) in Q1 2025. Adjusted net income was $20.3 million, or 13 cents per adjusted diluted share, compared to $2.1 million in Q1 2025 and $28.9 million in Q4 2025. Pre-synergy combined 2026 adjusted total revenue for Bullish plus Equinity is projected between $1.25 and $1.35 billion.

Risks & headwinds

- The proposed Equinity acquisition may not close as expected, due to potential delays or failure to obtain required regulatory approvals. - Anticipated strategic and financial benefits of the Equinity acquisition, including accelerated tokenization adoption, cost synergies, and new revenue growth, may not be realized. - Integration of Equinity's business following closing may face unforeseen operational or strategic challenges. - Tokenization adoption by public company issuers may progress slower than currently expected, even with the combined platform's capabilities. - Actual results may differ materially from forward-looking projections due to ongoing macroeconomic headwinds, including volatile digital asset prices and interest rate changes.

Analyst Q&A

• Q: Owen Lau (Clear Street) asks for the timeline for Bullish's DCM and DCO licenses, and whether the firm plans to enter traditional equities, commodities, and metals derivatives trading.

  A: Management notes that while regulatory approval timelines are uncertain, the company already holds licenses from stringent global regulators, and CFTC reviews have become faster, with approvals for DCOs coming in under a year. All application materials have been submitted, and conversations with CFTC leadership have been positive. The licenses position the firm to trade tokenized securities on the secondary market, completing the full end-to-end tokenization offering, while also opening the large U.S. market to the firm's existing crypto derivatives franchise, which has grown to 14% global Bitcoin options market share outside the U.S. in six months. A broker-dealer license filing is expected in May 2026, with a shorter approval timeline.

• Q: Pete Christensen (Citi) asks what will compel existing public company CFOs to adopt tokenization, when current shareholder infrastructure already functions well.

  A: Management states that inbound interest from dozens of issuers in the week post-announcement has already alleviated concerns about issuer adoption. For issuers, tokenization provides far greater visibility into shareholder base, which is extremely limited under the current nested TradFi infrastructure. Additional benefits include the ability to reward long-term shareholders via dynamic dividend structures, elimination of naked short selling transparency issues, and 24/7 trading for global investors, all of which reduce issuers' cost of capital by improving investor satisfaction. Unlike traditional transfer agent services, which are seen as a low-value mandatory cost, tokenization adds clear tangible value that justifies higher service fees, and interest has already come from a broad range of non-crypto industrial issuers. The required trading licenses are expected in 2026 to support the launch of tokenized share trading.

• Q: Ken Worthington (JP Morgan) asks why Subscription Services and Other revenue (SSNO) was flat quarter-over-quarter despite the Consensus Hong Kong event in Q1.

  A: CFO David Bonanno explains that the company absorbed all expected full-year headwinds immediately in Q1: a 24% quarter-over-quarter drop in Bitcoin (and larger drops for other digital assets), lower interest rates that reduced stablecoin revenue, and the discontinuation of low-priority legacy liquidity services from 2023. Consensus Hong Kong revenue was more than enough to offset these headwinds, allowing the firm to deliver slight sequential growth, a result management is proud of given the challenging market environment.

• Q: Chris Brendler (Rosenblatt Securities) asks for an update on U.S. client growth and whether the Equinity acquisition creates opportunity for Equinity to gain transfer agent market share from its duopoly competitor.

  A: Management confirms U.S. expansion is progressing on track, with a growing pipeline of large global financial institution clients, though extended diligence processes lengthen sales cycles. While Equinity is already a global leader with major presence in the UK and multiple markets, the combined platform's unified ledger (bridging traditional and tokenized shares in a single system, rather than requiring two separate providers) is a unique differentiator that has already attracted inbound inquiries from competitors' customers. Market share growth will come primarily from new IPOs and gradual gains from the existing installed base, rather than an overnight shift, but the differentiated offering gives the combined firm a clear competitive advantage.