Coinbase reports $1.4B Q2 revenue, beating estimates despite lower profits

US-based crypto exchange Coinbase reported $1.4 billion in total revenue for Q2 2024, surpassing analyst estimates of $1.36 billion but down from $1.6 billion in Q1. The exchange saw transaction revenue decline while stablecoin and Base usage grew significantly.

Coinbase’s Q2 earnings revealed mixed results, with revenue beating expectations but profits declining sharply compared to the previous quarter. Transaction revenue came in at $781 million, down 27% quarter-over-quarter, while subscriptions and services revenue reached $600 million.

Despite the overall revenue decline, Coinbase highlighted several positive developments. The number of transactions on its Base layer-2 network grew 300% compared to Q1. Stablecoin revenue also increased to $240.4 million, up from $197.3 million in the previous quarter. Notably, the exchange reported that Solana made up 10% of its overall transaction revenues.

However, the exchange’s profitability took a significant hit. Net income dropped to $36 million from nearly $1.2 billion in Q1. The company attributed $319 million in pre-tax crypto asset losses to its investment portfolio, stating that “the vast majority of which were unrealized — as crypto prices were lower on June 30.” Adjusted EBITDA also fell to $596 million from $1.01 billion in the previous quarter.

Looking ahead, Coinbase expects Q3 subscription and services revenue to range between $530 million and $600 million. The company anticipates increased technology, development, and administrative expenses in Q3, driven by “non-linear expense recognition” of stock-based compensation.

These results come at a pivotal time for Coinbase and the broader crypto industry. The exchange emphasized progress in regulatory clarity, noting that “advancing crypto legislation is now a mainstream issue.” Coinbase’s Stand With Crypto initiative has garnered over 1.3 million advocates, many in swing states, attracting attention from politicians from both sides.