Last Thursday, Coinbase surprised analyst expectations by posting sales of nearly $2.5 billion in the previous quarter, with a monthly active user base of 11.4 million.
The revenue figure was the largest for Coinbase ever, above the $1.97 billion consensus projection, while the user count, which was also a record, reversed a recent slide that saw the company’s user base drop to 7.4 million in Q3.
Last quarter, Coinbase produced $840 million in profits, more than double the previous quarter’s profit but still falling short of the $1.6 billion it made in the second quarter of last year.
The outstanding results were no doubt fueled by record-breaking crypto prices in October and November when Bitcoin nearly exceeded $70,000, and the frenetic trading that followed. Given the bear market that has defined 2022 thus far, they are unlikely to be repeated.
Coinbase’s stock price, which has been hovering near an all-time low in recent weeks, does not appear to have risen as a result of Thursday’s results announcement. COIN shares were down marginally in after-hours trading, selling at roughly $169, a long cry from the highs of over $400 seen shortly after the company debuted last year.
The Coinbase earnings also revealed that Ethereum’s share of trade volume, which had previously surpassed Bitcoin, had dropped to 16 percent last quarter. Other assets, such as Dogecoin, Shiba Inu, and others, saw their volume rise from 59 percent to 68 percent.
Over $200 million of Coinbase’s revenue comes from non-trading methods such as staking and lending, according to the company’s earnings. While this represents less than 10% of Coinbase’s total revenue, it indicates that the company is finally diversifying away from the trading fees on which it has long relied and which many fears are under threat from commission-free platforms like Robinhood.
Coinbase lauded the success of Web3, DeFi, and NFTs in its letter to shareholders, implying that they will help the company and the crypto sector grow even more. A graph depicting the rapid expansion of self-hosted wallets and the NFT market was provided in the letter
Coinbase also used the results call to highlight a slew of new products it’s released in recent months, including a tax center and a payroll center. Since last fall, the company has been promoting intentions to build an NFT marketplace with social media elements, but the service has yet to emerge.
This Thursday at 5:30 p.m. (ET), Coinbase management will have an earnings call to answer questions from investors about the company’s declining stock price and efforts to diversify revenue.