Coinbase Q2 revenues beat estimates but USDC interest income falls to $151 million
Quick Take
- Beating analyst estimates, Coinbase reported $708 million in revenue for the second quarter of 2023 compared to $808 million for the same period of the prior year.
- Trading volumes declined during the quarter, falling to $92 billion versus $217 billion registered in the same period last year.
Coinbase beat analyst estimates by posting $707.9 million in revenue for the second quarter of 2023 compared to $808.3 million seen in the same period last year.
Analysts had been expecting revenues of $629 million. The crypto exchange saw a net loss of $97.4 million for the second quarter compared to a $1.1 billion loss the prior year.
"Q2 was a strong quarter of execution for Coinbase and marked continued
progress in our journey to build a company that is increasingly efficient and
financially disciplined," the company wrote in a letter to shareholders. The company has been embroiled in an ongoing battle with the Securities and Exchange Commission.
The company generated $151 million in USDC stablecoin interest income during the quarter. That's down from $199 million in USDC interest income in the first quarter, with the company citing a 28% decrease in USDC market cap as a contributing factor.
Coinbase sees declining trading volume, transaction fees
Coinbase also reported $327 million in revenue for transaction fees, a lackluster sum amid depressed trading volumes. Transaction fee revenue for the same quarter last year was $655 million.
Trading volumes declined during the quarter, falling to $92 billion versus $217 billion registered the quarter a year ago.
Coinbase said its recurring operating expenses “dropped nearly 50%” year on year, driven in part by a 30% reduction in headcount.
The company has recently managed to successfully diversify and add additional revenue streams such as charging subscription and service fees. It highlighted recent agreements with asset managers looking to bring spot bitcoin ETFs to light.
"This quarter also represented progress for crypto regulation, both in the U.S. and globally," the company said. "In the U.S., we’re beginning to see a pathway for bipartisan legislation that could enshrine consumer protections and an equitable market structure framework, while also recognizing the importance of keeping crypto innovation in the U.S."
Coinbase shares rallied 1.6% in post market trading to $92.23, according to TradingView. It's shares have risen almost 150% so far this year.
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