Coinbase Q2 Revenue Hits $1.45B, Net Income Drops Sharply

Coinbase reported total revenue of $1.449 billion in the second quarter, beating the market consensus estimate of $1.396 billion.

However, this figure represents an 11% decrease from the first quarter, partly attributed to the decline in consumer transaction revenue.

Coinbase Q2 Revenue Falls 29%

Coinbase’s second-quarter consumer transaction revenue fell 29% to $665 million, down from $1.07 billion in the first quarter. However, stablecoin revenue rose to $240.4 million from $197.3 million.

The company’s adjusted EBITDA was $596 million, down from $1.01 billion in the prior quarter. Net income also declined to $36 million from nearly $1.2 billion in the first quarter. For the same period last year, total revenue was $674.1 million.

According to the company, the net income included $319 million in pre-tax crypto asset losses in its crypto investment portfolio, most of which were not realized, due to lower prices last month .

Meanwhile, transaction revenue fell 11% to $781 million in the quarter, while subscription and services revenue rose 17% to $599 million, as the company diversified their sources of income.

Bitcoin was a key player in Coinbase’s trading volumes, accounting for 35% of the total number and 31% of transaction revenue in the second quarter. Instead, Solana contributed 10%.

Global trading volume decreased by 28% quarter-on-quarter, with the number of consumers down 34% and institutional volume down 26%. The exchange also saw significant progress with its Layer 2 network, Base, which saw a 300% increase in transactions quarter-on-quarter.

Coinbase noted that network efficiency improved significantly in the second quarter, with average daily fees per transaction falling below 1 cent, positioning Base as one of the most profitable L2 networks.

Coinbase Projects Q3 Revenue

Coinbase expects subscription and services revenue for the third quarter to fall between $530 million and $600 million. This estimate takes into account several factors: a 3% drop in the average price of Ethereum in July, the possibility of a rate cut in September, increased expenses due to the adoption of USDC as to supported stablecoin and $8 million unique blockchain rewards. revenue benefit recorded in Q2.

The company also expects challenges from volatile crypto prices and additional costs associated with adopting the global USDC stablecoin.

Coinbase shares are up about 20% year to date. After releasing its earnings report, the stock has seen a 5.22% decline, reaching $212 per share at the time of the report.

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