Shares of Coinbase Global Inc. experienced a slight uptick in late trading, despite the cryptocurrency exchange’s disappointing earnings report for the fourth quarter of fiscal 2025. The report surfaced amid a backdrop of declining transaction numbers fueled by a significant downturn in the prices of bitcoin and other cryptocurrencies. Coinbase’s stock had already seen a decline during the regular trading hours.
For the quarter ending December 31, Coinbase disclosed adjusted earnings of 66 cents per share, a steep decrease from $3.70 per share in the same quarter the previous year. The company’s revenue stood at $1.781 billion, reflecting a 22% year-over-year drop, falling short of analysts’ expectations of $1.05 per share in earnings and $1.85 billion in revenue.
The downturn in cryptocurrency trading impacted Coinbase’s transaction revenue, which amounted to $983 million, marking a 6% decline from the previous quarter. Additionally, subscription and services revenue also fell, down 3% over the same period to $727 million. Compounding the situation, Coinbase reported a rise in operational costs, with expenses for technology and development, general and administrative tasks, and sales and marketing increasing by 14% quarter-over-quarter to reach $1.3 billion.
The company recorded a net loss of $667 million for the quarter. However, adjusted net income was reported at $178 million, with adjusted earnings totaling $566 million. At the end of the quarter, Coinbase held $11.3 billion in cash and cash equivalents.
Despite the challenges, Coinbase made strides in diversifying its offerings. The company has rolled out prediction markets alongside new asset classes as part of its strategy to extend beyond traditional spot cryptocurrency trading. This initiative includes tools aimed at supporting event-based contracts and enhancing the trading ecosystem on its platform to become a multi-asset marketplace.
In a significant move, Coinbase launched 24/7 perpetual-style futures trading for U.S. customers, broadening its derivatives capabilities in the domestic landscape. This product enables eligible users to gain leveraged exposure to digital assets through contracts that do not have expiration dates, aligning closer with international markets for crypto derivatives.
Furthermore, Coinbase integrated technology from Deribit, a cryptocurrency derivatives exchange it plans to acquire for $2.9 billion, enriching its capabilities in options and institutional derivatives trading. This acquisition is expected to enhance Coinbase’s liquidity pools and trading workflows in the options market.
On a broader scale, Coinbase’s full-year results indicated adjusted earnings per share of $4.44, down from $8.38 in 2024, while revenue increased by 9.4% year-over-year to $6.883 billion. Co-founder and CEO Brian Armstrong remarked on the highs achieved during the year, highlighting that Coinbase One subscriptions reached approximately 1 million and that trading volume and market share doubled.
Looking ahead, Coinbase anticipates subscription and services revenue in the range of $550 million to $630 million for the upcoming first quarter. The unexpected rise in Coinbase’s stock, despite the adverse demand for its services, could be attributed to prior adjustments in the company’s outlook. Market analysts had already factored in a lackluster performance, making the latest results, though below forecasts, seem less dire than anticipated.
