Enter your email to read this article
Read news on any topic, in one place, from publishers like The Economist, FT, Bloomberg and more.

Coinbase Stock Dives After Q2 Earnings While Claiming They're An 'All Weather Company' For Crypto Prices Cycles

Cryptocurrency platform Coinbase Global Inc (NASDAQ:COIN) reported second quarter financial results and shared an updated full year guidance after market close Tuesday.

What Happened: Coinbase reported second quarter revenue of $802.6 million, compared to $2.0 billion in the previous year’s second quarter. Revenue missed a Street consensus of $830.5 million, according to data from Benzinga Pro. 

The company reported a loss of $4.98 per share in the second quarter, missing a Street estimate of a loss of $2.68 per share.

The company reported 9 million monthly transacting users in the second quarter, down 2% from the first quarter and up from the 8.8 million reported in the year ago period.

Coinbase had trading volume of $217 billion in the second quarter, down 30% from the first quarter.

Assets on the platform were $96 billion in the second quarter, down from $256 billion in the first quarter.

Bitcoin (CRYPTO: BTC) made up 31% of trading volume and 31% of revenue, compared to 24% and 25% in the first quarter, respectively.

Ethereum (CRYPTO: ETH) made up 22% of trading volume and 22% of revenue, compared to 21% and 23% in the first quarter, respectively.

“At Coinbase, we live by the mantra ‘it’s never as good as it seems, and it’s never as bad as it seems,’” the company said.

The company cited macroeconomic conditions and the crypto market dropping 60% of its market capitalization in the second quarter.

“Coinbase is an all-weather company with experience in navigating through crypto asset price cycles.”

The company focused on several chapters for the business in its shareholder letter:

  • Chapter 1: crypto is cyclical
  • Chapter 2: down markets create financial headwinds
  • Chapter 3: Coinbase is adjusting to market conditions
  • Chapter 4: building for the future, and excited by product momentum
  • Chapter 5: strong capital and risk position
  • Chapter 6: outlook

Along with the chapters laying out the company’s foundation and goals, Coinbase highlighted it has not blocked client withdrawals and had no credit losses from financing activities or exposure to client insolvencies.

“We did not have exposure to the significant trading volumes related to the liquidation events of $LUNA, Three Arrows Capital, Celsius and Voyager.”

Related Link: What To Watch For On Coinbase Global As The Stock Reacts To Q2 Earnings Results 

What’s Next: The company put an emphasis on taking several steps to streamline costs given the macroeconomic issues. This includes an 18% employee reduction in June and several other cost-cutting measures.

Guidance for the third quarter is lower monthly transacting users and trading volume than the second quarter, based on current trends and conditions seen in July.

For the full fiscal year, Coinbase sees monthly transacting users hitting a range of 7 million to 9 million.

“We continue to take a long-term view and remain focused on building for the future,” the company said.

The company said down markets can feel scary, but are “not as bad as they may seem.”

“At Coinbase, we are optimists and are focused on building great products and services for our users.”

COIN Price Action: Coinbase shares are down 3% to $85.42 in after-hours trading Tuesday.

Related Stories
4 Coinbase Analysts Have Mixed Feelings On Q2 Earnings: Are There Glimmers Of Hope?
Cryptocurrency platform Coinbase Global Inc (NASDAQ: COIN) reported second-quarter financial results after market close Tuesday. Here’s what analysts are saying about the company, the crypto bear market and what’s ahead.
From analysis to the latest developments in health, read the most diverse news in one place.
2 Low-Rated Stocks to Avoid Until Further Notice
As analysts expect the market to remain under pressure in the upcoming months over lingering macroeconomic headwinds, it could be wise to avoid fundamentally weak stocks Coinbase Global (COIN) and Roku (ROKU). These stocks have an overall Strong Sell or Sell rating in our proprietary rating system. Read more….
Coinbase racks up $1.1bn loss as crypto trading volumes slump
Exchange says downturn is part of a typical cycle as digital asset prices fall
How Coinbase Stock Looks As Bitcoin, Ethereum Surge Higher
On Sunday evening, Benzinga asked its followers on Twitter what stock they’re zeroed in on this week. From the replies, Benzinga selected one ticker for technical analysis.
What To Watch For On Coinbase Global As The Stock Reacts To Q2 Earnings Results
Coinbase Global, Inc (NASDAQ: COIN) is set to print its fiscal second-quarter financial results after the market closes on Tuesday. The stock was trading over 10% lower heading into the event.
One place to find news on any topic, from hundreds of sites.
Stock Market Loses Ground For Second Day; Micron Warns; Coinbase Set To Report
Stock market indexes traded lower in the first hour of Tuesday's session, with chips and big tech taking the brunt of selling pressure. Energy stocks, led by natural gas plays, rose after Russian oil flows through central Europe were halted. The Dow Jones Industrial Average is trading lower by 0.2%…