tl;dr
Coinbase’s stock dropped 8.4% in after-hours trading on July 31 after second-quarter results missed Wall Street expectations, closing at $377.76 and later rebounding to about $354.77. Q2 revenue was $1.5 billion, below the $1.59 billion forecast, with trading volume at $237 billion versus $252.76 bi...
Coinbase’s stock experienced an 8.4% drop in after-hours trading on July 31 following second-quarter results that failed to meet Wall Street expectations, before partially recovering later in the session. The stock closed at $377.76, fell to $346.01 immediately after the earnings release, and later rebounded to approximately $354.77 at press time.
The exchange reported total revenue of $1.5 billion for Q2, falling short of the $1.59 billion consensus. Trading volume hit $237 billion, also below the expected $252.76 billion. Transaction revenue came in at $764.3 million versus the $810 million forecast, while subscription and services revenue reached $655.8 million, missing the $715.2 million estimate.
A key highlight was a notable shift in Coinbase’s balance sheet. The company ended Q2 with $9.3 billion in cash, cash equivalents, and net USDC, a 6% decline quarter-over-quarter, reflecting $590 million less than Q1. This decrease stemmed partly from increased investments in crypto assets, including $222 million spent on Bitcoin purchases during the quarter. The fair value of digital assets held for investment was $1.8 billion, with an additional $951 million held as collateral, bringing total available resources to $12.1 billion.
Separately, Bitwise’s head of research, Ryan Rasmussen, noted that Coinbase incurred $307 million in costs related to the May 2023 data theft incident. The quarter revealed mixed business trends: while assets under custody hit a record high due to strong ETF flows and corporate adoption, softer market activity weighed down fee revenues. Management also acknowledged one-time expenses tied to the data breach, partially offset by gains from its crypto investment portfolio.
In a notable development, Coinbase announced intentions to offer tokenized equities on its platform, though it provided no further details on timing, scope, or structure in its shareholder letter or public statements as of July 31.