TLDR
- Q3 revenue reached $1.9 billion, beating analyst estimates by $100 million with 58% year-over-year growth
- Transaction revenue doubled to $1 billion while adjusted EBITDA hit $801 million
- Base Layer 2 network turned profitable driven by increased transaction activity and higher ETH prices
- Bitcoin treasury expanded by 2,772 BTC, bringing total holdings to 14,548 BTC worth $1.57 billion
- Institutional revenue doubled to $135 million with Deribit contributing $52 million post-acquisition
Coinbase delivered third quarter earnings that surpassed Wall Street expectations. The crypto exchange posted $1.9 billion in total revenue, up 58% from $1.2 billion last year.
Analysts had projected $1.8 billion. The beat came as trading volumes reached $295 billion across the platform.
Transaction revenue hit $1 billion compared to $573 million in Q3 2024. This segment remains the primary revenue driver for the company.
Net income totaled $433 million for the quarter. Adjusted EBITDA climbed to $801 million from $449 million year-over-year.
The stock gained 1.5% in after-hours trading. Regular session trading saw shares decline 5.8%.
Trading Activity Drives Revenue Growth
Consumer transaction revenue reached $844 million, marking a 30% increase from Q2. Retail trading volume jumped 37% quarter-over-quarter.
Institutional clients generated $135 million in transaction revenue. This represents more than double the prior year figure.
The Deribit acquisition closed in August. The crypto options platform added $52 million to quarterly revenue.
Institutional custody assets crossed $300 billion for the first time. This set a new all-time high for the exchange.
Ethereum captured 22% of transaction volume, nearly matching Bitcoin’s 24% share. Previous quarters saw Bitcoin holding roughly twice the market share.
Base Network Achieves Profitability
The Layer 2 network Base reached profitability in Q3. Higher transaction volumes and ethereum prices drove revenue growth on the network.
Transaction fees decreased on a per-unit basis. Base processed activity across trading, payments, lending and social applications.
Coinbase rolled out Flashblocks during the period. The feature delivers 200-millisecond block times for transaction preconfirmation.
Subscription Services and Bitcoin Holdings Expand
Subscription and services revenue rose 14% to $747 million. Stablecoin-related revenue accounted for $355 million of the total.
USDC balances on the platform hit a record $15 billion average. The stablecoin supports Coinbase’s “Everything Exchange” initiative.
Blockchain rewards revenue increased 28% to $185 million. Rising ether and solana prices boosted this segment.
The company purchased 2,772 BTC during Q3. Total Bitcoin holdings now stand at 14,548 BTC valued at $1.57 billion.
Coinbase ended the quarter with $11.9 billion in USD resources. A $3 billion convertible debt raise contributed to this balance.
Operating expenses dropped 9% from Q2. Management projects October transaction revenue around $385 million.
Fourth quarter subscription revenue is forecast between $710 million and $790 million. The company cautioned about crypto market volatility impacting future performance.
Institutional traders represented 80% of the $295 billion trading volume.
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