Investors will be looking to Coinbase Global (COIN) CEO Brian Armstrong for fresh remarks on his firm’s forward prospects when it reports first quarter results on Thursday that will show how the major crypto exchange weathered a rough stretch in crypto markets.
Coinbase is expected to post year-over-year declines across nearly all of its business units, along with its lowest adjusted earnings in two years and a net income loss, according to analyst forecasts compiled by Bloomberg.
Earlier this week, Coinbase said it plans to reduce its headcount by 14%, citing “current market conditions” and a need to “optimize the Company’s operations for the AI era,” according to a regulatory filing.
Coinbase’s stock is down more than 12% since the beginning of January. Last week, rival trading platform Robinhood (HOOD), which has less exposure to the crypto market, reported profit and revenue that fell below analyst expectations, due in part to lower fees from crypto trades.
A survivor of numerous past crypto winters, Coinbase has actively sought to expand its revenue beyond its bread-and-butter transaction fees earned from retail traders by expanding consumer products and offering crypto services to institutions. Late last year, the firm said it would introduce trading in stocks, tokenized stocks, futures, and prediction market contracts.
The major exchange is also on the cusp of getting what it wants in a Washington, D.C., lobbying battle with the banking industry that has stalled a landmark crypto bill.
Coinbase is fighting to protect its ability to offer customers interest on their stablecoin holdings, a key growth driver. The revenue Coinbase earns from stablecoin reserves is expected to climb 45% to $327 million compared to the year-ago period, according to analyst estimates.
David Hollerith covers the financial sector, ranging from the country’s biggest banks to regional lenders, private equity firms, and the cryptocurrency space.
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