Hyperion DeFi, Inc. Q3 FY2025 earnings call

• Strategic Transformation: Hyperion DeFi completed a significant corporate transformation from a biotech company to a U.S. publicly listed digital asset treasury focused on the Hyperliquid ecosystem. Hyperliquid is a leading decentralized perpetuals exchange with over 60% market share, daily revenues over $3 million, and sequestered over 30 million HYPE tokens.
• Q3 Achievements: Launched first HYPE Asset Use Service agreement with Credo, introduced HiHYPE liquid staking token, initiated partnership with Native Markets for USDH, and saw Validator tokens delegated from Hyperliquid Foundation increase. Research and development expenses decreased 89% y-o-y to $374,000, and selling, general, and administrative expenses declined 30% to $2.6 million.
• Financial Highlights: GAAP net income was $6.6 million, a record high, with adjusted EBITDA of $8.0 million. Revenue from digital assets businesses exceeded $300,000, and net income per common share was $0.26 (basic) and $0.05 (diluted).

In Q3, Hyperion DeFi achieved income from operations of $4.4 million and GAAP net income of $6.6 million, both record highs. They started the quarter with $45.5 million invested in HYPE tokens, purchased an additional $20.0 million worth, and recognized GAAP accretion of $7.1 million. Revenue from digital assets businesses exceeded $300,000 in Q3, up from less than $2,000 in Q3 2024. The digital asset segment is key, with HYPE tokens valued at $38.0 million at quarter-end, and liquid staking tokens (LSTs) considered digital intangible assets. Gross HYPE Holdings were $77.8 million, accounting for combined HYPE and LSTs including estimated accretion. Tokens delegated to their Validator grew from 8.2 million in September to 13.2 million in October, a 60% month-over-month increase.

• Q4 '25 Adjusted Revenues: Anticipates adjusted revenues between $475,000 and $515,000, representing a 31% to 43% quarter-over-quarter increase.
• Operating Cash Flow: Expect operating cash flow to turn positive in 2026, aiming for a run rate where ongoing operations are funded without needing to raise funds, draw down cash, or sell HYPE tokens.

• Crypto Liquidation Event: The October 10 crypto liquidation event didn't impact Hyperion DeFi as they didn't take leverage positions with HYPE assets. Trading volumes and fees quickly returned to Hyperliquid post-event.
• Regulatory Uncertainties: Operate in a dynamic regulatory environment, but welcome clarity around crypto/DeFi interaction with financial infrastructure, such as the GENIUS Act supporting stablecoin innovation.

Q: How did the crypto liquidation event on October 10 impact your business?

A: While it was unfortunate for many, Hyperliquid's centralized exchange had 0 downtime, applications on HyperEVM worked perfectly, and Hyperion DeFi's operations weren't affected as they didn't use leverage. Trading volumes and fees quickly returned to Hyperliquid.

Q: What do you think of recent regulatory developments and their impact on DeFi and your business?

A: The regulatory environment is favorable, with the GENIUS Act encouraging stablecoin innovation, which benefits Hyperliquid's native stablecoin USDH. We operate responsibly to navigate regulatory outcomes.

Q: Are you considering an additional capital raise?

A: After raising $50 million in June, we focused on building our business. We'll consider additional raises based on liquidity, market conditions, and HYPE deployment effectiveness.

Q: How did the crypto liquidation event impact your business?

A: As above, no impact on Hyperion's operations due to no leverage, and volumes returned quickly.

Q: What measures do you take to secure your tokens?

A: Use self-custody infrastructure from Anchorage Digital Bank and native multi-sig on Hyperliquid, with ongoing diligence of service providers.

Q: Will Kinetiq airdrop be baked into your forecast?

A: We're eligible for Kinetiq airdrop but don't know financial implications; our Validator is top 10 with growing tokens, and HiHYPE supports utility, showing flywheel effect.

Q: Why haven't you sold the Optejet?

A: We're taking a rational approach, completing R&D and testing for commercial viability, with ongoing evaluations of strategic alternatives.

Q: Are you going to hire more people?

A: We aim to remain lean but have long-term ambitions to bridge institutional and on-chain finance, with team building in progress.