Coinbase Slips After Revenue, Forecast Doesn’t Live Up to Expectations

Coinbase Global (COIN) say Tuesday afternoon User growth slowed in the second quarter and is expected to fall further from this year’s balance due to disappointing outputs.

The largest cryptocurrency exchange in the US reported monthly trading users, or MTUs, of 9 million in Q2, more than 8.4 million analysts expected, but down from 9.2. million in the previous quarter. The company expects the average annual MTU to reach 7-9 million by 2022.

Coinbase said that trading volume in the second quarter fell by $92 billion, reflecting the boom in the crypto market during the quarter.

The company’s quarterly results slipped Wall Street estimated, with net sales coming in at $802.6 million versus expectations of $854.8 million. In the same quarter of last year, net sales reached $2 billion.

“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 in its second-quarter letter to shareholders.

“Coinbase is an all-weather company experienced in navigating through crypto asset price cycles. We continue to take a long-term view and focus on building for the future. “

The company’s shares fell about 5% in after-hours trading. As of now, the stock has lost about two-thirds of its value this year.

The logo of Coinbase Global Inc, the largest U.S. cryptocurrency exchange, is displayed on a jumbotron of Nasdaq MarketSite and others at Times Square in New York, U.S., April 14, 2021. REUTERS / Shannon Stapleton

The logo of Coinbase Global Inc, the largest U.S. cryptocurrency exchange, is displayed on a jumbotron of Nasdaq MarketSite and others at Times Square in New York, U.S., April 14, 2021. REUTERS / Shannon Stapleton

Here are some key figures from the report, compared to estimates from Bloomberg:

  • Turnover: $802.6 million versus $854.8 million

  • Monthly Transactional Users (MTU): 9 million versus 8.4 million

  • Trading volume: -29% to $219 billion vs -28% to $220.4 billion

  • Revenue from subscriptions and services: $147 million versus $138.7 million

  • Content on the platform: $96 billion versus $156.95 billion

  • Adjusted EBITDA 🙁$151 million) compare to ($187.2 million)

  • Earnings per share: ($4.98) versus ($2.28)

From the beginning of April to the bottom on June 18, the total market capitalization for all crypto assets fell 63% from $2.15 trillion to $802 billion according to Coinmarketcap.

“The dramatic market movements have altered user behavior and trading volumes, which in turn affects trading revenue,” Coinbase said in its report.

Monthly Transaction Users (MTU) fell to 9 million, down from 9.4 million in Q1 but about 600,000 more users than Wall Street had anticipated.

Total trading volume down 29% in the second quarter to $219 billion from $309 billion at the end of the second quarter. “buy-the-dip” retail activity, which led to part of the increase in the first quarter, deteriorated in the second quarter.

Retail trade volume was $46 billion, down $28 billion from Q1, while institutional trading was $171 billion, down $64 billion.

The platform’s most traded asset remains bitcoin, which accounted for 31% of the trading revenue for the quarter. Ether accounts for 22% of trading revenue; all other assets account for an additional 47%.

Revenue from subscriptions and services like staking, which analysts had previously hoped could be a diversified revenue stream for crypto trading volumes, continued to decelerate in Q2. generates $147 million in quarterly revenue, subscriptions and services little changed from the $152 million figure made in Q1.

Outside the Labor force drop of 18% announced on June 14Coinbase said it would reduce its “full-year cost range for Technology & Development and General & Administration Expenses” while “pausing, maintaining, and prioritizing an “outside” product development approach. main areas.

As of Tuesday afternoon, bitcoin, which has been less bearish in recent weeks, has changed hands at $23,163, down 3% correct day. The Market’s Largest Cryptocurrency Has Slipped Out of $47,163 to $23,163 since the beginning of January.

“While the Q2 results are in line with the outlook we provided in May and reflect challenging crypto market conditions, we are actively adjusting to match conditions.” market,” Coinbase added.

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