Key Takeaways
- Citi analyst downgraded Gemini Space Station (GEMI) to Sell from Neutral, slashing the price target from $13 to $5.50
- Shares declined 5.1% in premarket hours to $6.75, extending year-to-date losses to 28%
- The firm anticipates a $263 million adjusted EBITDA loss in 2025, with profitability not expected until 2029
- February app downloads plummeted to 41,000, a significant drop from the 100,000+ monthly downloads recorded in the previous nine months
- The company has already implemented layoffs affecting 25% of its workforce and exited major international markets
Gemini Space Station made its public debut at $28 per share last September. Today, shares hover near $6.75. The downward trajectory steepened on Wednesday with a particularly harsh analyst assessment.
Gemini Space Station, Inc. Class A Common Stock, GEMI
Peter Christiansen, an analyst at Citi, issued a downgrade of GEMI from Neutral to Sell, simultaneously reducing his price objective to $5.50—down significantly from the previous $13 target. The revision came through a research report released Wednesday, just one day before Gemini’s scheduled fiscal-year earnings announcement after market close on Thursday.
Premarket trading saw shares fall 5.1%. The stock has shed 28% of its value year-to-date.
The Winklevoss brothers’ decision to take Gemini public coincided with a peak period for cryptocurrency markets. Bitcoin was hovering near record highs when GEMI shares began trading. However, since October, Bitcoin has retreated approximately 40% from those peaks, dragging down trading activity throughout the crypto sector.
This industry-wide contraction is severely impacting Gemini’s business model. Reduced trading volumes translate directly to diminished revenue for a company that was already operating at a loss.
Path to Profitability Extends Another Year
Citi’s previous forecast anticipated Gemini achieving positive EBITDA by 2028. That timeline has now been extended to 2029 or beyond.
Christiansen’s 2025 projections show an adjusted EBITDA loss of $263 million. This represents a company hemorrhaging cash while attempting to develop its platform amid challenging market conditions.
“We have increasing concerns the company will be challenged to scale profitability within a reasonable time frame for equity investors,” Christiansen wrote.
The analyst additionally noted that progress on the CLARITY Act—legislation that could provide clearer regulatory guidelines for cryptocurrency platforms—has stagnated as lawmakers continue debating critical provisions.
User Engagement Shows Troubling Decline
Metrics tracking user activity paint an equally concerning picture. Monthly unique visitors to Gemini’s application and website have consistently trended downward since the September IPO.
February’s app download figures registered only 41,000—a stark contrast to the previous nine consecutive months, each of which exceeded 100,000 downloads.
For a platform heavily dependent on network effects, such declining engagement presents a significant challenge that typically requires a major catalyst to reverse.
Gemini has responded aggressively with cost-cutting measures. The company announced last month it would eliminate approximately 25% of its headcount.
Additionally, Gemini revealed plans to cease operations in the United Kingdom, Europe, and Australia. High-level executive departures include the COO, CFO, and Chief Legal Officer.
“We find ourselves stretched thin with a level of organizational and operational complexity that drives our cost structure up and slows us down,” the Winklevoss twins wrote in a blog post explaining the international exit.
While these reductions clearly aim to extend the company’s financial runway, Citi remains skeptical that the available time will prove sufficient.
Gemini is scheduled to release complete fiscal-year results following Thursday’s market close. The report will provide investors with crucial information about whether the company’s restructuring efforts are yielding tangible results.
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