Coinbase Reports Robust Q4 Earnings; Shares Rise 12.7% in After-Hours Trading
Summary:
Coinbase, a leading cryptocurrency exchange, reported a 12.7% surge in its shares after a strong Q4 earnings release. The firm’s net revenue hit $905 million, marking a 45.2% increase from the previous quarter, and saw a turnaround from a $2 million net loss to $273 million net profit quarter-on-quarter. Majority of the revenue was derived from transaction fees, with significant contributions from consumer cryptocurrency trades and institutional transactions. Prior to the earnings report, Coinbase's stock had risen sharply, further buoyed by a rating upgrade from JPMorgan analysts. The firm also achieved its target of a positive 2023 Adjusted EBITDA, anticipating moderate employee growth and higher total expenses in 2024.
Following its strong Q4 earnings report that surpassed expectations, cryptocurrency exchange Coinbase saw its shares surge by 12.7% during after-market hours. The firm not only turned profitable but its net revenue in the Q4 hit $905 million, a 45.2% climb from the previous quarter, thereby beating the estimated figure of approximately $825 million. For the first time since Q4 2021, the company reported a net profit of $273 million, bouncing back from a $2 million net loss posted in the earlier quarter.
The lion's share of Coinbase's revenue—$529.3 million—came from transaction fees, with $493 million constituting earnings from consumer crypto trades, nearly twice that of the Q3 figures. Revenue from institutional transactions more than doubled to $36.7 million. The company processed over $29 billion in trading volume from consumers, witnessing a sharp 164% rise quarter-on-quarter.
Revenue of $375.4 million was generated from subscriptions and services, primarily deriving from stablecoin and blockchain rewards which totaled $171.6 million and $95.1 million, respectively.
As per Google Finance, following the results, the price of COIN’s shares increased 12.7% to $186.7 in after-hours trading. In the eight trading days leading up to the report, Coinbase's stocks had already risen by 41.2% due to investors predicting robust financial results. This optimism was further fueled by an upgraded rating issued by JPMorgan analysts on February 15th.
Coinbase stated it achieved its target of generating positive Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) for 2023, with a total of nearly $1 billion earned, including net income of $95 million. The company also anticipates "moderate headcount growth" in 2024 and is preparing for an expected rise in its total expenses for the year.
Published At
2/16/2024 1:46:55 AM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.