Coinbase’s Earnings Call Highlights Strong Growth and Optimism

Coinbase Global, Inc. ((COIN)) has held its Q4 earnings call. Read on for the main highlights of the call.

The latest earnings call for Coinbase Global, Inc. was marked by a largely positive sentiment, highlighting strong revenue growth, increased trading volumes, and favorable regulatory developments. Despite these positive indicators, there were some concerns about declining stablecoin revenue and rising expenses, which tempered the overall enthusiasm.

Impressive Revenue Growth

Coinbase reported a remarkable total revenue in 2024, more than doubling to $6.6 billion. This impressive growth was accompanied by an adjusted EBITDA of $3.3 billion, marking two consecutive years of positive adjusted EBITDA and highlighting the company’s robust financial health.

Subscription Services Surge

The earnings call underscored a significant increase in subscription services revenue, which surged by 64% year-over-year to $2.3 billion. This growth was primarily driven by USDC, staking, and Coinbase One, indicating a thriving segment within the company’s business model.

Record Trading Volume

Q4 saw a record total trading volume of $439 billion, a substantial 137% increase quarter-over-quarter. Consumer trading volume also saw a remarkable rise, reaching $94 billion, up 176%, reflecting heightened user engagement and activity on the platform.

International Revenue Growth

Coinbase’s international revenue share climbed to 19% in Q4, attributed to improved payment rails and localization efforts. This growth underscores the company’s successful expansion strategy beyond the domestic market.

Positive Adjusted EBITDA and Net Income

The company achieved a Q4 adjusted EBITDA of $1.3 billion, coupled with a net income of the same amount. Significant gains from its crypto asset investment portfolio bolstered these figures, demonstrating strong operational performance.

Regulatory Tailwinds

The regulatory environment is becoming increasingly favorable for Coinbase, with new pro-crypto legislation and support from the US government. This development bodes well for the company’s future operations and strategic initiatives.

Strong Balance Sheet

Coinbase’s USD resources grew to $9.3 billion by the end of the year, providing the company with the flexibility needed for strategic investments and potential acquisitions.

Stablecoin Revenue Decline

Despite the positive news, stablecoin revenue saw a decline of $21 million or 9%, primarily due to the lower interest rate environment and new USDC ecosystem participants, which presents a challenge for the company.

Increased Operating Expenses

Operating expenses in Q4 rose to $1.2 billion, a 19% increase. This was mainly driven by higher transaction expenses and increased marketing spend, raising concerns about cost management.

Volatility Impact Concerns

During the call, analysts expressed concerns about the potential impact of market volatility on user activity. However, management downplayed any significant impact, providing reassurance to stakeholders.

Forward-Looking Guidance

Coinbase provided an optimistic outlook for 2025, aiming to grow revenue through existing products, expand into international markets, and capitalize on regulatory tailwinds. Key priorities include enhancing derivatives trading, driving USDC’s market cap growth, and increasing subscription services revenue. The company also plans to accelerate crypto payments integration, lower transaction fees on Base, and support landmark crypto legislation, while maintaining a strong focus on operating discipline and opportunistic investments.

In summary, the earnings call for Coinbase Global, Inc. conveyed an overall positive sentiment, backed by significant revenue growth and favorable regulatory conditions. While challenges such as declining stablecoin revenue and rising expenses were noted, the company’s strategic priorities and strong financial position provide a solid foundation for future growth.