Coinbase shares collapsed by 12%. How did the main US crypto exchange disappoint Wall Street?

Coinbase Global quotes collapsed after the publication of the quarterly earnings report. The largest cryptocurrency exchange in the United States did not reach revenue forecasts, but is increasing revenues from stablecoins.

Coinbase shares on the Nasdaq fell post-market by 9.2% when the cryptocurrency exchange's second-quarter 2025 financial results came in much weaker than investors expected, both in earnings and revenue. The collapse intensified to 11.5% in pre-market trading on August 1.

Coinbase's second-quarter revenue came in at $1.5 billion - below the consensus forecast, which was in the range of $1.56-1.59 billion. Adjusted (non-GAAP) earnings were particularly weak, coming in at just $0.12 per share against a forecast of $1.49, notes Cointelegraph. Coinbase's financial results were negatively impacted by a sharp decline in transaction revenue caused by a drop in spot cryptocurrency trading volumes. 

At the same time, the quarter was not a complete failure. Despite the overall revenue decline of 26%, revenue from subscriptions and services decreased by only 6% - it was supported by the growth of balances on client accounts in stablecoins, especially in USDC. Stablecoin revenue grew by 12%, and Coinbase expects continued growth in this segment in the current quarter.

Coinbase fell short of market forecasts due to low retail cryptocurrency trading volumes, explained John Todaro, senior analyst at investment firm Needham & Company. "The reason for the divergence from Wall Street's consensus forecast was a change in trading patterns: retail investor activity was" well below market expectations, Todaro told Bloomberg.

Coinbase is developing a dual model, acting both as a platform for retail traders and as a provider of infrastructure solutions for institutional players. However, the main revenue still comes from trading, noted Coindesk columnist Helen Brown. In her words, Coinbase's report demonstrated the company's continued sensitivity to the cyclicality of the crypto market.

Monness Crespi Hardt analyst Gus Gala shortly before the publication of Coinbase's reduced rating of its shares from Buy to Neutral, removed the target price and advised clients to lock in profits. According to the analyst, Coinbase's market value has grown too much over the past couple of months, even with the positive regulatory news in the crypto sector and the rise of bitcoin.

Bitcoin on the morning of Aug. 1 dropped to $114.25 on the Coinbase exchange, its lowest level since June 11. The reason for the sell-off was given by the President of the United States Donald Trump, who signed an executive order on July 31 on high duties on goods from several dozen U.S. trading partners. 

The largest cryptocurrency closed July at the highest level in its history - $115.8 thousand. However, it was not the most impressive month in terms of the scale of growth. The leader in this indicator remains November 2024, when bitcoin rose by $26 thousand after the election of Trump as U.S. president, recalls Cointelegraph.

This article was AI-translated and verified by a human editor