Coinbase Revenue Could Plunge More Than 75% Amid Crypto Slump

Crypto exchange likely lost $568 million in Q4 2022


Leon Neal / Getty Images

Coinbase Global, Inc. (COIN), the second-largest cryptocurrency exchange by trading volume, likely logged a fourth consecutive quarter of losses as transaction revenue plummeted and crypto prices stagnated for almost a year.

Key Takeaways

  • Coinbase will likely report EPS of -$2.48 vs. $3.33 for the same period in the prior year.
  • Revenue probably plunged more than 75% to $588.6 million.
  • Coinbase's trading volume fell throughout 2022 amid a slump in cryptocurrency prices and the collapse of the FTX exchange.
  • The firm also faced regulatory challenges, including a $100 million fine levied by U.S. regulators over compliance issues.

Coinbase probably posted a loss of $568.1 million for the fourth quarter after posting a profit over the same period in the prior year, according to estimates compiled by Visible Alpha. Earnings per share (EPS) is expected to be -$2.48. Revenue likely plunged by more than three quarters to $588.6 million, the lowest in two years.

Trading volume on Coinbase's exchange platform fell each quarter of 2022 as investors shied away from cryptocurrencies amid a market slump. The high-profile collapse of the FTX exchange in November exacerbated investor reluctance over concerns that their money could be permanently lost in similar situations at other exchanges.

Coinbase also faced mounting regulatory concerns late last year. In January, the firm reached a settlement with New York regulators including a $100 million fine for compliance and know your client (KYC) issues.

A silver lining for Coinbase is that, as one of the largest exchanges with a reputation among customers for trustworthiness, declines in trading volume slowed in the final months of the year in the midst of the FTX debacle. Volume has increased on Coinbase's platform this year while rivals like Kraken and Gemini have faltered, though this will not be reflected in the upcoming financial report.

Shares of Coinbase rallied early in 2023 as the price of cryptocurrencies rose, but the stock remains down 66% over the last year, compared with a 10% drop for the S&P 500 Information Technology Index.

One-Year Total Return for S&P 500 Information Technology Index and Coinbase
Source: TradingView.
Coinbase Key Stats
  Estimate for Q4 FY 2022 Actual for Q4 FY 2021 Actual for Q4 FY 2020
Earnings Per Share ($) -2.48 3.33 0.86
Revenue ($M) 588.6 2,498.5 585.1

Source: Visible Alpha

Article Sources
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  1. CoinDesk. "Bitcoin Price."

  2. CoinMarketCap. "Top Cryptocurrency Exchanges Ranked By Volume."

  3. YCharts. "Coinbase Global Income Statement."

  4. CoinDesk. "Coinbase Trading Volume Increases in January While Other Exchanges See Declines: JPMorgan."

  5. New York Times. "The Crypto Industry Struggles for a Way Forward."

  6. New York Department of Financial Services. "Superintendent Adrienne A. Harris Announces $100 Million Settlement with Coinbase, Inc. after DFS Investigation Finds Significant Failings in the Company’s Compliance Program."

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