AtlasClear Holdings, Inc. (ATCH) Q2 2026 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call summary shows strong financial performance with an 84% revenue growth and positive net income. The Q&A section reveals proactive management addressing dilution concerns and providing clarity on liquidity and growth funding. The company plans to scale its clearing business and expects accretive bank acquisition. Despite some risks, the overall sentiment is positive due to strong financials, strategic acquisitions, and clear management communication. However, absence of market cap data limits precise impact prediction.
Key Financial Performance
Revenue Revenue grew 84% year-over-year to $5.1 million. Growth was driven by higher client activity across the platform, led by continued strength at the operating subsidiary.
Net Income Net income was $6.8 million, which includes noncash fair value adjustments. This reflects a materially stronger underlying operating and financial profile than a year ago.
Stockholders' Equity Stockholders' equity turned positive to $21.7 million, an increase of nearly $60 million from the year-end of 2024. This marks a meaningful inflection point for the company.
Cash and Restricted Cash Ended the quarter with $46.2 million in cash and restricted cash, including $23.1 million in cash and cash equivalents. This provides flexibility to support operations, regulatory requirements, and continued execution.
Total Assets Total assets increased to $77.6 million compared to $60.9 million as of June 30, 2025. This reflects a substantially stronger financial position.
Net Capital at Wilson-Davis Net capital at Wilson-Davis totaled $14.7 million at quarter end, supporting higher levels of client activity and providing capacity to onboard new correspondent relationships.
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Operating Highlights
Modern technology-enabled financial infrastructure platform: AtlasClear has been focusing on building a platform to serve smaller and midsized institutions, which are often underserved by larger incumbents. The December quarter marked the transition of this vision into execution.
Market environment alignment: The current market environment is becoming increasingly constructive for AtlasClear's model, with greater engagement from broker-dealers and financial institutions seeking operational efficiency, risk management, and infrastructure modernization.
Revenue growth: Revenue grew 84% year-over-year to $5.1 million, driven by higher client activity across the platform.
Net income: Reported net income of $6.8 million, reflecting a stronger financial profile.
Stockholders' equity: Turned positive to $21.7 million, an increase of nearly $60 million from the previous year-end.
Liquidity: Ended the quarter with $46.2 million in cash and restricted cash, including $23.1 million in cash and equivalents.
Operational backbone: Wilson-Davis continues to perform as the core clearing engine, with consistent performance and capacity to onboard additional relationships.
Acquisition of Commercial Bancorp of Wyoming: Progressing towards the proposed acquisition, subject to regulatory approval and customary closing conditions.
Scaling responsibly: Prioritizing opportunities that align with infrastructure, regulatory framework, and capital profile, focusing on accretive growth rather than growth for growth's sake.
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Risk or Challenges
Regulatory Approval for Acquisition: The proposed acquisition of Commercial Bancorp of Wyoming is subject to regulatory approval and customary closing conditions, which could delay or prevent the completion of the acquisition.
Operational Scaling Risks: The company is focused on scaling responsibly, but there is a risk of straining the platform if growth is not managed carefully, particularly as they onboard new clients and expand services.
Dependence on Wilson-Davis: Wilson-Davis is described as the core clearing engine of the platform. Over-reliance on this subsidiary could pose risks if its performance falters or if it faces operational challenges.
Market and Economic Conditions: The company acknowledges that its business model is influenced by market stability and interest rate expectations, which could adversely impact client engagement and revenue if conditions deteriorate.
Cost Management: Expenses have increased in line with revenue growth, driven by variable compensation, clearing and data processing costs, and stock-based compensation. Poor cost management could erode profitability.
Client Onboarding and Retention: The company emphasizes deliberate client onboarding and retention, but challenges in attracting or retaining the right clients could impact growth and operational efficiency.
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Guidance & Outlook
Market Trends and Client Engagement: The current market environment is becoming increasingly constructive for AtlasClear's model. As markets stabilize and expectations around interest rates evolve, there is greater engagement from broker-dealers and financial institutions. These firms are focusing on operating more efficiently, managing risk, modernizing infrastructure, and expanding beyond traditional equities into a wider range of products and services. AtlasClear believes this dynamic aligns well with its clearing-centric platform.
Operational Scaling and Client Onboarding: AtlasClear is prioritizing scaling responsibly by onboarding the right clients and supporting them effectively. The company is focusing on opportunities that are accretive and fit its infrastructure, regulatory framework, and capital profile. The approach emphasizes deliberate and execution-focused growth rather than growth for growth's sake.
Acquisition Plans: AtlasClear is progressing toward the proposed acquisition of Commercial Bancorp of Wyoming, subject to regulatory approval and customary closing conditions. This acquisition aligns with the company's broader vision for modern regulated financial infrastructure.
Strategic Priorities for 2026: AtlasClear's priorities include enhancing the core clearing business with smarter technology, improving connectivity across workflows, and ensuring the platform remains adaptable to evolving markets and client needs, particularly in areas like fintech and regulated digital assets. The company is focused on long-term durable growth.
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Shareholder Return Plan
The selected topic was not discussed during the call.
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Key Q&A
Q:Can you walk through what the fully diluted share count looks like today and whether we're largely past the heavy conversion phase?
A:The current outstanding share count is approximately 150 million shares. The only remaining viable conversions are from the October 8 financing, which would add approximately 43 million shares from warrants and a little over 14 million shares from the convertible note if converted. The original de-SPAC warrants, representing approximately 26 million shares, are still outstanding but have a high strike price of $690 per share. Future dilution is expected to be accretive.
Q:How should investors think about true corporate liquidity versus regulatory capital, and can the business fund growth internally?
A:The regulatory capital threshold is $10.5 million, which the company must maintain to keep its correspondent license. The company has $23.1 million in cash that can be spent but aims to keep at least $15 million for regulatory purposes. The business is positioned to fund growth internally.
Q:At what revenue level does the clearing business begin to generate consistent operating leverage, and what does the path to scale profitability look like?
A:The clearing business requires $14 million in operating costs to provide services. Beyond this threshold, the business can scale significantly, with solid margins. The relationship with Dawson James and other clients will help achieve this, and the company expects to scale through 2026.
Q:Can you provide more clarity on the expected ramp timeline for the new introducing brokerage firms and when investors should see measurable impact on revenue or account growth?
A:The company is scaling its correspondent clearing business, focusing on smaller to mid-sized institutions. Dawson James is expected to begin trading soon, and subsequent clients should onboard more quickly. Revenue impact should be visible in the next few quarters.
Q:Can you provide a realistic update on the timing, regulatory visibility, and financial profile of AtlasClear with or without the proposed Commercial Bancorp acquisition?
A:The company has updated its stock purchase agreement and is preparing to file its application with the Fed. Regulatory approval is expected to move faster than previously anticipated. Without the acquisition, Wilson-Davis can build a profitable correspondent clearing firm. With the acquisition, the company will combine clearing services with banking services, creating a one-stop solution. The bank acquisition is expected to be immediately accretive, with the bank generating $1.9 million in revenue and $500,000 in net income in 2025.
Q:Review of Unclear Management Responses
A:None of the questions were avoided or lacked clarity. All responses were detailed and addressed the questions directly.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
CFO General
Counsel Director
Counsel PCG
Davis backbone
Davis capital
Davis core
Davis engine
Director result
General Counsel
Holdings Instructions
Instructions reminder
Liquidity cash
President Chief
QA listener
Schaible step
Stockholders equity
Wyoming approval
accomplishment end
acquisition Commercial
activity capacity
activity leverage
activity platform
broker dealer
client activity
core clearing
engagement
engine platform
flexibility
interest
platform strength
profile
stock locate
utilization
vision progress
workflow
year
ATCH Transcript
AtlasClear Holdings, Inc. (ATCH) Q2 2026 Earnings Call Transcript
Positive2-13
The earnings call summary shows strong financial performance with an 84% revenue growth and positive net income. The Q&A section reveals proactive management addressing dilution concerns and providing clarity on liquidity and growth funding. The company plans to scale its clearing business and expects accretive bank acquisition. Despite some risks, the overall sentiment is positive due to strong financials, strategic acquisitions, and clear management communication. However, absence of market cap data limits precise impact prediction.
AtlasClear Holdings, Inc. (ATCH) Q1 2026 Earnings Call Transcript
Unknown11-14
The earnings call summary presents mixed signals. While revenue increased significantly by 52% YoY, the company reported a net loss and faces challenges in profitability and regulatory compliance. The Q&A section highlights potential growth in digital assets and a strategic acquisition, but lacks specific timelines and faces integration risks. Despite operational improvements, economic uncertainties and competitive pressures remain. The lack of clear guidance on key initiatives tempers optimism, leading to a neutral sentiment.
ATCH Report
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Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
