Coinbase Breaks Profit Streak with $667M Q4 Loss as Crypto Market Cools
As a widespread sell-off in the cryptocurrency market battered the exchange's trading profits, Coinbase Global (COIN) announced a startling
Quick overview
- Coinbase reported a net loss of $667 million in Q4, ending an eight-quarter streak of profitability.
- The company's revenue dropped 22% year over year to $1.78 billion, missing Wall Street's expectations.
- Despite the losses, Coinbase's non-trading revenue streams, particularly from subscriptions and stablecoins, showed growth and provided some investor confidence.
- Regulatory uncertainties surrounding U.S. cryptocurrency legislation continue to impact Coinbase's operations and market outlook.
As a widespread sell-off in the cryptocurrency market battered the exchange’s trading profits, Coinbase Global (COIN) announced a startling turnaround of fortune in its fourth-quarter results on Thursday, posting a net loss of $667 million and ending an eight-quarter run of profitability.
Analyst predictions of a profit of between 55 and 92 cents per share, depending on the projection, were severely missed by the $2.49 per share loss. At about $1.78 billion, net revenue dropped about 22% year over year and fell short of the $1.85 billion Wall Street had projected.
A sharp decline in trade activity was the cause. A more than 45% decline in consumer transaction volumes was a major factor in the roughly 37% decline in transaction revenue to $982.7 million from the same quarter last year. A general decline in digital asset markets was reflected in the slowdown: Bitcoin reached a top of over $126,000 in early October before plunging almost 30% to end the year below $88,500. The market value of the entire cryptocurrency industry has decreased by about $2 trillion since the peak of Bitcoin in October.
Additionally, investors withdrew funds from spot Bitcoin ETFs that had contributed to the 2024–2025 cryptocurrency rise; U.S.-listed funds saw withdrawals of $7 billion in November, $2 billion in December, and over $3 billion in January.
Coinbase (COIN) Q4 Financial Breakdown: Missing the Mark
The quarter loss, Coinbase’s first since Q3 2023, adds to a challenging period for the company’s stock, which has dropped almost 40% so far this year and about 63% from its October peak.
Investors seemed to find some solace in indications of resiliency in other areas of the company, despite the depressing headline figures. Thursday’s after-hours trade saw shares rise roughly 2-4 percent after closing the regular session down 7.9% at $141.10.
Coinbase’s The “Everything Exchange” Strategy
Coinbase’s expanding non-trading revenue streams were the main source of confidence. Revenue from subscriptions and services increased 13.5% year over year to $727.4 million, largely due to a sharp increase in stablecoin revenue, which increased to $364.1 million from $225.9 million the previous year.
“Stablecoins and subscription revenues are going to lessen the revenue volatility and smooth things out versus its prior reliance on cryptocurrency trading revenues,” said David Bartosiak, stock strategist at Zacks Investment Research, who says Coinbase makes stablecoin income through its partnership with USDC issuer Circle, earning interest on the dollar reserves backing the token.
Coinbase reported that its full-year 2025 revenues increased 9.4% to $6.88 billion, describing it as a “strong year” both financially and operationally. Additionally, the business reported that over 12% of the global cryptocurrency market was housed on its platform at the time.
Coinbase stated that it has already made $420 million from transactions through February 10 of this year, but that its subscription and services revenue would drop from $727.4 million in Q4 to $550–$630 million in Q1. Aleshia Haas, the company’s chief financial officer, stated that the company intends to maintain about constant levels of marketing, sales, and technology expenditures in comparison to Q4 levels.
Regarding regulations, Coinbase’s role in U.S. cryptocurrency legislation that has stagnated has continued to draw attention. The fate of the historic law remains uncertain after a White House conference earlier this month that sought to reconcile disagreements between banks and cryptocurrency companies over the Clarity Act, which would create government regulations for digital assets, ended without a settlement.
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