Coinbase Blows Away Estimates with $1.9B in Q2 Transaction Revenue, COIN Stock Tanks


Despite great results in Q2, Coinbase stock plunged yesterday. It closed at $269.67, or 3.85% down, with a $58.98 billion market cap. After hours, its price slightly rebounded to $271.88.

On August 10, Coinbase Inc (NASDAQ: COIN) reported its Q2 2021 results, showing quite strong performance. The company has beaten analysts’ expectations, surpassing all their estimates. According to its second-ever earnings report as a public company, Coinbase has reached $1.9 billion in transaction revenue in the period considered. Meanwhile, FactSet analysts’ forecast was only $1.57 billion.

Despite great results in Q2, Coinbase stock plunged yesterday. It closed at $269.67, or 3.85% down, with a $58.98 billion market cap. After hours, its price slightly rebounded to $271.88.

Coinbase Q2 Report: Details

Apart from topping $1.9 billion in revenue in the second quarter of 2021, Coinbase also surprised analysts with significant growth in the number of users. In particular, the exchange has grown to 8.8 million monthly transacting users (MTUs), which is 44% up from the previous quarter, as well as 68 million total users. Notably, the estimates were 6.7 million monthly users and 62.8 million total users.

By now, Coinbase has expanded to over 160,000 ecosystem partnerships as well as 9,000 institutions that broaden their activities in the crypto economy with the help of Coinbase.

As far as the revenue is considered, Coinbase has generated $2.0 billion in net revenue, including $1.9 billion in transaction revenue and over $100 million in subscription and services revenue. Net income totaled $1.6 billion, adjusted EBITDA made up $1.12 billion. The latter is slightly down from last quarter’s $1.15 billion.

In terms of trading volume, Coinbase reported $462 billion in Q2, a 38% increase of 38% from Q1. Total retail trading volume was 21% up, at $145 billion, and comprised 31% of the total trading volume. Further, institutional trading volume totaled $317 billion and accounted for 69% of the total trading volume. According to Coinbase, the increase in the number of institutional users on the Coinbase platform was along with higher capital allocations into crypto.

Expenses of Coinbase in the second quarter totaled $1.4 billion. $335 million of it went for transaction expenses, $292 million went in technology and development expenses, and $248 million was spent for general and administrative expenses.

Looking Forward

The company did not provide formal guidance for the upcoming quarter. However, it said that retail MTUs and total Trading Volume would be lower in comparison to Q2. For the full 2021 year, Coinbase is expecting further institutional onboarding, increased capital allocations to crypto, and increased trading volumes from existing clients.

Further, the exchange anticipates the annual average net transaction revenue per user to exceed a historical range of $34-$45 per month.

As for the expense, Coinbase has no updates. But looking to full-year 2021, it expects that its technology and development expenses and its general and administrative expenses will be between $1.3 billion to $1.6 billion, excluding stock-based compensation.

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Daria Rud

Daria is an economic student interested in the development of modern technologies. She is eager to know as much as possible about cryptos as she believes they can change our view on finance and the world in general.

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