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Coinbase Q1 2023 Revenue Beats Estimates As Markets Rebound

Bloomberg2023-05-04

  • See interest income hurt by USD Coin’s lower market cap

  • Coinbase forecasts lower subscription and service revenue

Photographer: Tiffany Hagler-Geard/BloombergPhotographer: Tiffany Hagler-Geard/Bloomberg

Coinbase Global Inc. posted a narrower loss and a smaller-than-estimated revenue decline, as the biggest US digital-asset trading platform saw first-quarter results stabilize somewhat during a rebound in cryptocurrency prices. 

The loss narrowed to about $79 million, from $430 million, in the year-earlier period, the company said in a statement. It was the fifth consecutive quarterly loss. Revenue fell by about 34% to $772.5 million, though it increased from the fourth quarter, when token prices tumbled amid a series of industry scandals and bankruptcies. The average of estimates compiled by Bloomberg for revenue was about $654 million. 

Looking ahead, the crypto industry “continues to be volatile, as evidenced most recently by the disruptions in the banking sector and ongoing regulatory uncertainty,” Coinbase said in an investor letter. “We continue to focus on our cost reduction efforts.”

For the second quarter, the company expects lower subscription and service revenue from the first quarter, driven by lower USD Coin market capitalization, it said. Interest income from USD Coin was $199 million, according to the letter. 

Coinbase has been navigating a market downturn and a difficult US regulatory environment. The company, which cut staff by 20% in January, faces more uncertainty after receiving a notice from the US Securities and Exchange Commission in March threatening to sue it over several business lines. The company provided an updated headcount of 3,535 full-time employees, a 29% decline from the same quarter last year.

Despite Coinbase “operating in a very challenging regulatory and business environment in the first quarter,” the company still turned into positive adjusted Ebitda,  said Owen Lau, an analyst of Oppenheimer & Co. “I think that’s a substantial turnaround that the market has not given them enough credit for.”  

Shares of Coinbase rose about 8% in after-hours trading. The stock, which is down almost 90% since its April 2021 debut, has jumped around 40% this year.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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Comment（3）

  • 买香蕉也用券
    ·2023-05-05
    Dripp
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  • 中蓝的中榕
    ·2023-05-05
    bullish
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  • runningjames
    ·2023-05-04
    Great... Sell if profitable, might dip back below anytime 
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  • 02:28

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    Azalea Investment Management - First Closing at US$262 Million for Altrium Private Equity Fund Iii

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