Rosenblatt Trimmed Galaxy's Q1 View-But CoreWeave Turns the FUD Into a Setup

Rosenblatt cut Galaxy's Q1 view, but it did not change the rating

Rosenblatt's estimate cut looks more like a near-term caution call than a broken thesis. The firm lowered Galaxy's first-quarter revenue estimate to $8.3 billion from $9.3 billion as crypto prices fell 20%-30% and industry trading volume dropped about 39%. That mainly pressures the parts of Galaxy's business that still depend on crypto market activity. More important, Rosenblatt kept its Buy rating and $39 price target, suggesting the longer-term story still holds even if the next few quarters look uneven.

The reason is straightforward: Galaxy is increasingly judged on whether Helios can turn into real lease revenue, not just on crypto-cycle swings. Galaxy says Phase I was delivered on schedule, with rent commencement beginning in the second quarter of 2026, and Helios has now moved into revenue-generating operations after delivering initial capacity to CoreWeave. That does not erase near-term crypto weakness, but it does shift the main investment debate toward execution.

Helios is moving Galaxy from story mode toward execution

The estimate trim matters, but the bigger development is that Helios is starting to convert power access into lease revenue. That changes the backdrop from AI narrative to operational delivery.

Phase I is the first real proof point

Galaxy has now cleared a major milestone: Helios Phase I delivered approximately 200 MW of gross power, with 133 MW of critical IT load turned over to CoreWeave and rent commencement set for the second quarter of 2026. Once rent begins, the asset starts looking less like a construction project and more like a revenue-producing one.

CoreWeave gives the buildout more substance

Tenant commitment is central to the bull case. CoreWeave has already committed to the full 260 MW of critical IT capacity at Phase II under a 15-year base lease with two five-year extension options. Across Phases I through III, that commitment expands to 526 MW of critical IT load, and Galaxy expects more than $1 billion in average annual revenue from those leases. That is a meaningful anchor-tenant backdrop for a project tied to AI-ready power demand.

The Phase II model points to high lease-backed returns

Galaxy's Phase II financing plans $3.507 billion of senior secured notes due 2031 to fund part of the build, while the project structure lists $10.4 billion in minimum contracted lease payments over the initial term. The illustrative 2028 model calls for $472 million of rent and $424 million of net operating income, or about a 90% NOI margin. The lease is described as near triple-net, with CoreWeave covering costs such as utilities, taxes, insurance, maintenance, and ordinary repairs. That structure gives the project a relatively lean, contract-backed revenue profile.

What would confirm the setup-and what could derail it

The constructive case depends on a narrow set of execution points: - Phase II civil and structural work continues advancing. - Minimum rent commencement still lands around the second quarter of 2027. - The financing required for Phase II comes together without disrupting delivery.

If those markers hold, Galaxy has a clearer path from AI infrastructure development to sustained lease revenue. If they slip, the story will once again look more like a pre-revenue buildout than an operating asset.