Coinbase stock tumbled Friday after missing the mark on key metrics with its Thursday Q2 earnings report.
The cryptocurrency exchange on Wednesday announced a partnership with JPMorgan and received a pair of major price hikes earlier this week as the Trump administration's digital asset policy takes shape.
Coinbase Earnings
Coinbase reported earnings of $5.14 per share, up from 14 cents per share last year, on a slight uptick in revenue to $1.5 billion.
FactSet expected earnings of $1.25 on $1.59 billion in revenue.
Adjusted earnings were 12 cents per share, down from $1.10 per share last year.
Transaction revenue was $764 million for the quarter, down from $781 million a year ago and $1.26 billion in Q1, respectively.
Analysts expected $814 million in transaction revenue.
Retail transaction revenue declined to $649.9 million, and missed views for $710 million.
Institutional transaction revenue was $60.8 million, falling short of estimates for $79 million.
Subscription and services revenue climbed to $656 million, but didn't meet analyst expectations for $708 million.
Stablecoin revenue increased to $332.5 million. That also missed estimates for $363 million in stablecoin revenue.
Total trading volumes rose about 5% from last year to $237 billion, but was down from $393 billion in Q1.
For Q3, Coinbase expects subscription and services revenue to range from $665 million to $745 million. The exchange forecasts that July transaction revenue will come out to $360 million.
CEO Brian Armstrong in a social media post on Thursday afternoon announced that Coinbase increased its bitcoin holdings by 2,509 bitcoin during the quarter. The exchange now holds 11,776 bitcoin with a total cost basis of $740 million.
Coinbase, JPMorgan Partnership
Coinbase and JPMorgan Chase on Wednesday announced a partnership to bring new crypto offerings to JPMorgan's 80 million customers.
Starting in the fall, customers will be able to use their Chase credit cards to make purchases on Coinbase, according to the announcement. Starting next year, Chase customers will be able to link their accounts directly to Coinbase. Chase members will also be able to redeem their Ultimate Rewards points for the stablecoin USDC.
Crypto Bills Spark Target Hikes
Elsewhere, Citi on Tuesday said that Coinbase's momentum is "just getting started," according to a research note reported by The Fly. Citi noted that President Donald Trump's signing of the GENIUS Act, the House passage of the Clarity Act (though not yet passed in the Senate), and Coinbase's recent inclusion in the S&P 500 are all positive drivers. The firm also sees additional upside to COIN stock from its futures trading options, as well as its leadership in a regulated era of crypto.
Citi hiked its price target on COIN stock from 270 to 505, 32% above where share traded on Thursday, and kept a buy rating on the shares.
In addition to the recent crypto bills working their way through Congress, the White House on Wednesday released a digital asset report that outlined the administration's recommendations for a crypto regulatory framework.
Jefferies on Monday also raised its price target on Coinbase to 405 from 260. The firm expects about 40% growth in retail trading volumes quarter over quarter, and raised its net revenue estimates by 5%. Jefferies kept a hold rating on Coinbase stock.
Coinbase Stock
Coinbase fell 16.7% Friday. COIN stock pared its Thursday advance to just a fraction ahead of results.
Shares advanced 1.6% Wednesday after the White House digital asset report.
Coinbase has retreated from its record high of 444.65 on July 18. Prior to earnings, the stock was poised for a possible rebound from support at the 21-day exponential moving average. The stock is still up almost 27% so far this year.
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