Coinbase Q3 Earnings Recap: Revenue And EPS Miss, Monthly Users Fall Less Than Robinhood, Stock Jumps

Cryptocurrency trading company Coinbase Global COIN reported third-quarter financial results after the market close Thursday. Here's what investors need to know. 

What Happened: Coinbase reported third-quarter revenue of $576 million, down 28% sequentially. The revenue total missed a Street estimate of $659.88 million, according to data from Benzinga Pro.

The company reported a loss of $2.43 per share, missing a Street estimate of a loss of $2.40 per share.

Transaction revenue was $366 million in the third quarter, down 44% sequentially. Subscription and services revenue of $211 million was up 43% sequentially.

Coinbase had 8.5 million monthly transacting users in the third quarter, down 500,000 from the second quarter. Competitor Robinhood Markets HOOD ended the third quarter with 12.2 million monthly active userrs, losing 1.8 million from the previous quarter. 

Coinbase reported trading volume of $159 billion in the third quarter.

The company cited headwinds affecting trading volume but said it is retaining customers and seeing engagement with non-investing products.

Staking was an item highlighted in the third-quarter results, with the addition of Solana SOL/USD-related staking in June being a primary driver for the company.

Coinbase added 22 crypto assets to custody and 20 to its trading platform in the third quarter to bring the total to 220 tradeable assets.

Bitcoin BTC/USD trading volume made up 31% of total volume in the third quarter, in-line with the second quarter. Ethereum ETH/USD trading volume was 33% of the company’s total, up from 22% in the second quarter.

Related Link: A Look At Coinbase Stock Into Q3 Earnings, Will Crypto Revnues Indicate Bullish Sentiment Is Returning? 

What’s Next: The company is “cautiously optimistic” that it will be within the $500-million adjusted EBITDA loss it previously guided for the full fiscal year.

For the full year, the company said it expects to have less than 9 million monthly transacting users.

“While the macro headwinds are beyond our control, we continue to focus on factors within our control: narrowing our product, focus to deliver amazing customers experiences and reducing our operating expenses,” the company said.

The company highlighted recent partnerships with BlackRock BLK and Alphabet Inc GOOGGOOGL as reasons for optimism going forward.

“Looking ahead, we could not be more excited about the industry leading partnership, as well as the momentum and innovation we see in our own product portfolio and across the industry more broadly.”

The company reiterated it has key strategic priorities moving forward.

“We are investing to ensure we are well positioned to meet future demand as the cryptoeconomy grows.”

Coinbase said it will allow users to buy, sell, stake, pay, borrow and more from a single platform.

A retail app could bring the next 100 million users into the cryptocurrency sector, according to Coinbase. 

COIN Price Action: Coinbase shares were up 2.62% to $57.26 in after-hours trading Thursday.

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