Shares of Coinbase rose 12.7 percent after its fourth-quarter earnings beat.
Shares in crypto exchange Coinbase rose 12.7% after hours after a strong fourth-quarter earnings report saw the company swing to a profit and earnings that beat Wall Street expectations.
Coinbase's net income reached $905 million in the fourth quarter, up 45.2% from the third quarter, beating the consensus estimate of around $825 million.
Meanwhile, the firm's profit in the quarter reached $273 million in net income, the first positive income quarter since the fourth quarter of 2021. In the previous quarter, Coinbase had posted a net loss of $2 million.
Trading revenue comprised the company's revenue of $529.3 million, with $493 million coming from consumer crypto trading, more than double from the third quarter. Institutional trading revenue more than doubled to $36.7 million.
Our Q4'23 and full year 2023 update is in.
Read the full shareholder letter and tune in to our earnings call: pic.twitter.com/DJ2NhFyfdU
— Coinbase ️ (@coinbase) February 15, 2024
More than $29 billion in transaction volume was generated from consumers, representing 164 percent growth quarter over quarter.
The company earned $375.4 million in subscription and services revenue — mostly from Statcoin and blockchain rewards of $171.6 million and $95.1 million, respectively.
The results sent COIN's share price up 12.7% to $186.7 in after-hours trading, Google Finance reported.
Related: Coinbase's latest announcement argues that blockchain could make coins ‘useful' again.
Coinbase stock has risen 41.2% over the past eight trading days as investors expect strong financial performance ahead of the earnings release.
Part of this positive sentiment was fueled by a February 15 rating by JPMorgan analysts.
Ben Weiss, CEO of crypto firm CoinFlip, told Cointelegraph that Coinbase surpassed revenue targets as the company continued to expand its offerings in Q4.
“In the next quarter, I hope that Coinbase will continue to be at the forefront of compliance and regulatory discussions,” said Weiss, who should set the stage for a clear framework before the 2024 election.
Coinbase said it was able to achieve its 2023 goal of generating positive adjusted earnings before interest, taxes, depreciation and amortization (EBTDA).
“We generated net income of $95 million and positive adjusted EBITDA in all four quarters, totaling nearly $1 billion.”
The company added that it expects “moderate headcount growth” in 2024 and is preparing for a further increase in total spending in 2024.
Journal: Unstable Coins: Debasement, Bankruptcy and Other Risks Looming.
