Shares of Coinbase climb following a positive earnings report, with significant gains in the after-hours
Coinbase, a leading cryptocurrency exchange in the U.S., unveiled its financial achievements for the fourth quarter and the entirety of 2023 on February 15th, showcasing strong performance and strategic growth.
The exchange reported a substantial net income of $273 million in the fourth quarter, alongside an adjusted EBITDA of $305 million. Over the course of 2023, Coinbase achieved a net income of $95 million and an impressive adjusted EBITDA of $964 million.
Highlighting its fourth-quarter performance, Coinbase saw:
A surge in total revenue to $954 million, marking a 41% increase from the previous quarter.
Transaction revenue skyrocketed by 83% quarter-over-quarter to $529 million.
A steady growth in subscription and services revenue, up 12% from the previous quarter to $375 million.
Despite a challenging year, Coinbase's annual figures revealed:
A slight dip in total revenue to $3.1 billion, a 3% decrease year-over-year.
Transaction revenue fell by 36% year-over-year to $1.5 billion.
A remarkable 78% increase in subscription and services revenue to $1.4 billion.
Coinbase also highlighted its financial prudence and strategic asset management, noting a reduction in debt to 12% and an increase in U.S. dollar reserves to $5.7 billion, including cash, cash equivalents, and USD Coin (USDC) holdings.
With $207 billion in assets, primarily in current assets, Coinbase also disclosed nearly $450 million in held crypto assets outside its current assets.
Expanding its footprint globally, Coinbase detailed its success in attracting over 100 institutions to its international exchange platform launched in May 2023. It pointed out the global dominance of crypto trading, with 80% occurring outside the U.S., underscoring the importance of its global strategy.
Coinbase's institutional engagement saw significant milestones, including the onboarding of top hedge funds and its custodial role in several spot Bitcoin ETFs. Additionally, the company addressed its legal and regulatory challenges and contributions to political action committees.
Looking ahead, Coinbase provided insights into its early 2024 performance, with $320 million in transaction revenue for the first half of Q1 2024, though it advised caution in drawing conclusions from these early results. It also forecasted subscription and services revenue for Q1 2024 to range between $410 and $480 million, with an expectation of rising total expenses for the year.
Following the release of these financial results, Coinbase's stock (COIN) saw an uplift of 3.3% on the day, with a further 12.8% increase in after-hours trading, indicating strong investor confidence in the company's direction and performance.
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