Coinbase Q2 Latest Earnings Surpass Analysts' High Estimates

Thanks to an impressive $500 billion in trading volume, Coinbase’s earnings reach an astonishing all-time high. Not to investors though.

Credit | Financial Times
(Warning: the percentage change on this article is wrong; Coinbase’s stock has been very volatile after-hours, so it may be more up or more down than listed below)

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In a turn of events, Coinbase Global has met and surpassed analyst estimates, thanks to an incredible surge in user counts and quarterly trading volume. The company’s stock climbed by upwards of 3.5% immediately after-hours, before moving down to a drop of around 1%. After Coinbase’s 5:30PM earnings call (EST), the stock has reclaimed some gains, resting at between 0.8% and 1.5%. The company recorded the following:

  • EPS | $6.78 reported | $2.69 expected | 152.23% beat
  • Revenue | $2.23 billion reported | $1.88 billion expected | 18.38% beat

Both of those numbers were great beats for Coinbase, whose stock has been struggling in recent times. Thanks to a 1% miss on revenue and a 4.5% miss on EPS with quarter 1, investors had been looking for more.

That’s why many thought that this massive beat would be more than enough to satisfy the bears. Apparently, it’s not enough, with Coinbase’s stock (COIN) ranging from a 1% loss to a 3.5% gain. Personally, as an investor (warning, yes), I believe that this was a great beat and a great way to show that Coinbase was continuing to grow, even with Bitcoin’s value dropping.

Still, some strong numbers keep many investors proud:

  • Trading Volume | $462 billion, up from $335 billion
  • Retail MTUs | 8.8 million, a jump of 44%
  • Verified Users | an increase of 12 milllion in Q2
  • Retail Trading Volume | $145 billion, a 21% increase
  • Institutional Volume | $317 billion, a 47% increase

It seems like most major issues arise in Coinbase’s decrease in assets, a massive $43 billion drop from $223 to $180 billion. According to Coinbase, that’s thanks to a drop in Bitcoin and other crypto prices, although net asset inflows were much higher than exiting. We can expect to see Coinbase revenue pick up, and asset value especially, increase as Bitcoin and other cryptocurrencies’ prices increase again.

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With such mixed news, analysts and investors are at a crossroads: some analysts believe that the massive revenue beat and slight asset drop means that Coinbase stock is a sale. Others believe, both analyst and investor, (myself included), that the beats more than made up for the material asset value decrease. After all, if prices continue to increase, Coinbase’s net inflows will boost AUM to an all-time high.

Of course, none of this is certain. I’m not a financial advisor, and this is not financial advice. I’m currently invested in Coinbase, and if the stock drops, I’ll definitely put a bit more money into it. We’ll have to wait until Q3 to see how things really pan out, so make sure to check back into Statural.com for more news!

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