- Revenue: $4.40 per share. This may not match the average analyst estimate of $1.09.
- Revenue: $1.64 $1 billion vs. $1.34 billion expected
Coinbase, the leading U.S. marketplace for buying and selling digital tokens, reported net income of $1.18 billion, or $4.40 per share, compared with a loss of $78.9 million, or 34 cents per share, in the same period last year. Ta. In February, the company announced its first profit in two years.
Earnings for the quarter included a $650 million mark-to-market gain on crypto assets held for investment related to the company's adoption of updated accounting standards.
Consumer transaction revenue for the quarter was $935 million, an increase of well over 100%. From the same period last year. Total trading revenue nearly tripled to $1.08 billion in the quarter.
Transaction revenue has traditionally been the primary driver of revenue, with subscription and services revenue contributing $511 million in the quarter.
Coinbase shares rose nearly 9% on Thursday ahead of the report, and are up about 32% year-to-date after surging nearly fivefold in 2023. Stocks tend to benefit from Bitcoin's massive rally, as the cryptocurrency's massive rally leads to increased trading volumes. Demand for other services.
During the first quarter, Bitcoin hit a new all-time high of over $73,000 in March, and Ethereum, the second-largest digital asset, received its first major upgrade in more than a year.
The industry has also seen an influx of institutional investors since the Securities and Exchange Commission approved a number of new US spot Bitcoin exchange-traded funds. Many exchange-traded funds partner with Coinbase as their custody partner. By the end of the first quarter, these funds collectively brought in more than $50 billion.
According to analysts at Raymond James, cumulative net inflows peaked on April 8 and have been declining since then as Bitcoin has fallen.
“Bitcoin prices peaked as the pace of inflows slowed and have declined modestly since mid-March,” Raymond James analysts wrote in a note this week. “In fact, trading volumes on Coinbase’s platform have fallen significantly from early March levels.”
Coinbase also remains mired in a legal battle with the SEC. In March, a judge ruled that regulators' claims that virtual currency exchanges engaged in unregistered securities sales could be heard by a jury at trial.
Another potential headwind is new competition from Crypto.com, which has regained market share in recent months.
Coinbase insiders, including four executives, sold a combined $383 million in company stock in the first quarter, according to Raymond James analysts. This was more than double the sale in Q4 2023 and the largest insider sale since the company listed on the Nasdaq stock market in 2021.
Raymond James noted that the biggest seller was co-founder and director Fred Ertham, who made a $129 million profit on his shares.
— CNBC's Michael Bloom and Kate Rooney contributed to this report.
