Coinbase, the largest U.S.-based cryptocurrency exchange, reported second quarter earnings on Thursday. Why is the stock tumbling? Here’s what to know.
What happened?
Shares of Coinbase Global (NASDAQ: COIN) were down 15% in morning and midday trading on Friday, the lowest price the stock has hit in more than a month, after it reported lower-than-expected second quarter adjusted profit due to a slowdown in trading, according to Reuters.
Coinbase earnings
Revenue came in at $1.5 billion, which missed analyst expectations of $1.6 billion, while revenue tied to transactions came in at $764 million, missing StreetAccount estimates of $787 million, according to CNBC.
However, other earnings numbers came in strong.
In the three months ending June 30, Coinbase net income rose to $1.43 billion, to deliver earnings per share (EPS) of $5.14.
A further look at Coinbase’s EPS shows the company beat analyst expectations $1.51 by $3.65.
Subscriptions and services offerings – which include stablecoins, staking, interest income, and custody – grew 9% from the same period a year ago to $655.8 million, short of analysts’ projection of $705.9 million.
Analysts told Reuters that Coinbase could see trading volume improve, according to the company’s revenue estimates.
The earnings follow a surge in crypto spurrred on by the Genius Act‘s signing into law.
Coinbase on S&P 500
Coinbase joined the S&P 500 stock market index in May, replacing Discover; it is the first time a crypto company has been included on the index. The S&P 500 is one of the world’s best-known stock market indexes.
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