To The Moon

$Coinbase Global, Inc.(COIN)$ The first-quarter earnings exceeded expectations significantly, but the stock price still fell in after-hours trading, primarily due to a decline in April trading revenue.

• Revenue: $1.64 billion, exceeding the expected $1.34 billion.

• Earnings Per Share (EPS): $4.40, compared to the expected $1.09.

Q1 total revenue was $1.64 billion, a year-over-year increase of 112% and a sequential increase of 72%. Net income was $1.18 billion, compared to a loss of $78.9 million in the same period last year, marking two consecutive quarters of profitability. Quarterly income benefited from a $737 million pre-tax unrealized gain on cryptocurrency assets valued at market prices, of which $650 million in gains have not been realized. Adjusted EBITDA was $1 billion.

Consumer transaction revenue in the first quarter was $935 million, representing over 100% year-over-year growth. Consumer trading volume was $56 billion, a sequential increase of 93%, outperforming the 91% sequential growth in the US spot market.

Institutional transaction revenue in the first quarter was $85 million, a sequential increase of 133%. Institutional trading volume was $256 billion, a sequential increase of 105%, also outperforming the US spot market.

Subscription and service revenue in the first quarter was $511 million, a sequential increase of 36%.

Bitcoin trading volume accounted for 33% of total trading volume in the first quarter, contributing 30% of trading revenue.

Looking ahead, Coinbase generated over $300 million of total transaction revenue in April. Assuming cryptocurrency asset prices remain within the current range, subscription and service revenue for the second quarter is expected to be between $525 million and $600 million. Trading fees are expected to account for around ten percent of net revenue in the second quarter.

Coinbase saw a slight decline in after-hours trading, after experiencing a significant increase of over 8% during regular trading hours yesterday.

In a report this week, Raymond James analysts wrote, "With the slowing pace of fund inflows, Bitcoin prices peaking, and a slight decline since mid-March. In fact, trading volumes on the Coinbase platform have been significantly lower than the levels seen at the beginning of March."

The reported April transaction revenue of over $300 million from Coinbase is on par with or slightly lower than the first quarter's monthly average of $360 million, indicating a significant decline from March, which also raised concerns in the market regarding the contribution to Q2 trading.