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Coinbase stock sinks as weak crypto market leads to another quarter of loss
Coinbase Global (COIN) stock tumbled more than 14% early Friday after the company posted a wider-than-expected second quarter net loss on Thursday, marking its third quarter in the red since the crypto market began to drawdown from its October highs. (Disclosure: Yahoo Finance has a partnership with Coinbase.)
The company reported a net loss of $359 million, or $1.36 per share. That compared to a profit of $1.43 billion, or $5.14, in the year-ago period. Analysts anticipated a net loss of $0.44 per share.
Beyond the effect of falling crypto prices on Coinbase's investment holdings, its core revenue streams also weakened. Net revenue fell 17% from a year ago to $1.15 billion. The company's adjusted EBITDA dropped 59% from the year-ago period to $208 million, missing analyst expectations by a third.
Coinbase's weak quarter leaves Wall Street split on timing of a recovery
Coinbase's (COIN) second-quarter earnings did little to change Wall Street's long-term view. Most analysts blamed one of the weakest crypto trading environments in recent years rather than company-specific issues. The debate is over what comes next.
The company missed expectations across nearly every major financial metric, reporting $1.22 billion in revenue and $208 million in adjusted EBITDA as lower crypto prices and subdued trading volumes weighed on both transaction revenue and its growing subscription business.
Guidance for the third quarter also came in below consensus, prompting several firms to cut estimates and price targets.
Even bullish analysts acknowledged the quarter was soft. Cantor Fitzgerald called it "another soft quarter" driven by depressed crypto prices and weaker spot trading volumes, while Oppenheimer said the miss stemmed from broader market weakness rather than operational problems.
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