Coinbase stock drops 4% after surprise 1Q miss as crypto trading slows
The crypto platform missed earnings and revenue estimates as falling digital asset prices weighed on trading activity and investor sentiment.
What to know:
- Coinbase shares fell about 4% in after-hours trading after the company posted a surprise first-quarter loss and missed Wall Street revenue estimates.
- Weaker crypto markets dragged down Coinbase’s core trading business, with both transaction and subscription-and-services revenue coming in below analyst expectations.
- Even as it cuts roughly 14% of its workforce, Coinbase is leaning on growth in derivatives, prediction markets and stablecoin activity to reduce its reliance on volatile trading fees.
Transaction revenue totaled $755.8 million, missing analyst expectations of $805.2 million. Subscription and services revenue, a segment investors closely watch as Coinbase tries to reduce its reliance on trading fees, totaled $583.5 million, below expectations of $619.3 million.
Crypto markets weakened sharply as bitcoin and other digital assets fell. Lower prices and reduced volatility typically lead to weaker spot trading volumes across exchanges. Investors had expected a slowdown after the crypto selloff early in the quarter, even though bitcoin rebounded roughly 12% in March.
Coinbase has spent the past several years expanding beyond its core trading business into stablecoins, staking, derivatives and blockchain infrastructure. The company said Wednesday that its global crypto trading volume market share rose to 8.6%, a record high, driven partly by growth in derivatives trading.
