Coinbase (COIN) Stock: Exchange Posts $1.9 Billion Revenue as Base Network Turns Profitable

TLDR

• Coinbase reported $1.9 billion in Q3 revenue, up 58% from last year, beating analyst expectations of $1.8 billion
• Transaction revenue more than doubled to $1.0 billion while adjusted EBITDA reached $801 million
• Base Layer 2 network achieved profitability for the first time due to increased usage and higher ETH prices
• Bitcoin holdings grew by 2,772 BTC to reach 14,548 BTC valued at $1.57 billion
• Institutional transaction revenue doubled to $135 million with Deribit acquisition adding $52 million

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Coinbase posted third quarter results that exceeded Wall Street forecasts. The exchange reported total revenue of $1.9 billion, up from $1.2 billion in the same period last year.

FactSet analysts had expected $1.8 billion. Trading volumes hit $295 billion during the quarter.

Transaction revenue reached $1 billion, compared to $573 million a year ago. This remains the largest part of Coinbase’s business model.

The company reported net income of $433 million. Adjusted EBITDA came in at $801 million, up from $449 million in Q3 2024.

Coinbase Global, Inc., COIN

Shares rose 1.5% in post-market trading following the announcement. The stock had declined 5.8% during regular hours.

Consumer transaction revenue hit $844 million, up 30% from Q2. Retail trading volume grew 37% quarter-over-quarter.

Institutional traders drove $135 million in transaction revenue, more than double the previous year. The acquisition of crypto options platform Deribit closed in August.

Deribit contributed $52 million in revenue to the quarter. Institutional custody assets surpassed $300 billion for the first time.

Base Network Reaches Profitability Milestone

Coinbase confirmed its Layer 2 network Base turned profitable in Q3. Revenue from Base increased due to higher transaction volumes and ethereum prices.

Per-transaction fees dropped during the period. The network processed transactions across trading, payments, lending and social applications.

Coinbase launched Flashblocks on Base during the quarter. This feature enables 200-millisecond block times for faster transaction preconfirmation.

Subscription Revenue Climbs on Stablecoin Growth

Subscription and services revenue rose 14% to $747 million. Stablecoin-related revenue made up $355 million of that total.

Average USDC balances held on the platform reached a record $15 billion. Circle’s USDC plays a key role in Coinbase’s “Everything Exchange” strategy.

Blockchain rewards revenue increased 28% to $185 million. This came as ether and solana prices rallied during the quarter.

Ethereum’s share of transaction volume hit 22%, nearly matching Bitcoin’s 24%. This marks a change from previous quarters when Bitcoin held twice the share.

The company added 2,772 BTC to its treasury during Q3. Total Bitcoin holdings now stand at 14,548 BTC valued at $1.57 billion.

Coinbase closed the quarter with $11.9 billion in USD resources. The company raised $3 billion through a convertible debt offering.

Operating expenses fell 9% from the previous quarter. Management expects October transaction revenue around $385 million.

Q4 subscription revenue is projected between $710 million and $790 million. The company warned investors about crypto market volatility affecting future results.

Institutional trading accounted for 80% of the $295 billion trading volume. Retail users showed renewed interest in long-tail crypto assets.

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