Coinbase Reports Q3 Beat, But Trading Volumes Drop

Coinbase (NASDAQ:COIN) reported Q3 earnings that exceeded expectations but experienced a decline in trading volumes for the second consecutive quarter.

The company posted a Q3 EPS of ($0.01), surpassing the anticipated ($0.55). Despite a 5% quarter-over-quarter decrease, revenue reached $674.15 million, exceeding the Street forecast of $650.97 million.

Transaction revenue for Q3 declined by 12% quarter-over-quarter to $289 million, attributed to a 17% fall in total trading volume, which was slightly mitigated by increased realized fees due to the mix of trading activities. Subscription and services revenue remained steady quarter-over-quarter at $334 million.

Coinbase predicts subscription and services revenue to remain roughly consistent with Q3 levels for the fourth quarter and anticipates transaction expenses as a percentage of net revenue to be in the mid-teens.

Additionally, the company has adjusted its full-year 2023 outlook, now aiming for significant positive adjusted EBITDA, a revision from its previous target of improving the full-year 2023 adjusted EBITDA in absolute dollar terms compared to 2022.