Coinbase rises after revenue climbs more than estimates

Coinbase

Shares of Coinbase Global Inc. rose as much as 4% after the largest US crypto exchange reported revenue that exceeded Wall Street’s third-quarter estimates on the back of an uptick in trading while token prices climbed to record highs.

Revenue increased by 55% to 1.9 billion, ahead of analysts’ estimates of $1.8 billion. Revenue was $1.5 billion in the second quarter. Net income rose almost fivefold to $433 million, or $1.50 a share,  from $75.5 million, or 28 cents, in the year-ago period.

Trading volume reached $295 billion, the company said in shareholder letter Thursday. Transaction revenue was $385 million during the first month of the current quarter, during which investors were whipsawed by record liquidations just days after Bitcoin and other cryptocurrencies reached all-time highs.

Cryptocurrencies rallied through the first nine months of the year, buoyed by pro-industry agency of the second Trump administration, including the passage of the first US law regulating stablecoins in July. Brian Armstrong, the co-founder and chief executive officer of San Francisco-based Coinbase, has become one of the highest profile industry advocates as well as a large backer of Trump-related endeavors.

In addition to owning a stake in USDC stablecoin issuer Circle Internet Group Inc., Coinbase serves as one of the biggest distribution channels for the token. It garnered $354.7 million in revenue from stablecoins in the third quarter.

Traction in derivatives helped boost revenue as well. Recently acquired options platform Deribit added $52 million of revenue in the quarter, “driven by continued growth of options trading leading to all-time high notional volumes.” the company said. Deribit and Coinbase together had more than $840 billion of notional derivatives trading volume in the period, Coinbase said.

Coinbase plans to share more details on its plans for tokenized stocks and prediction markets on Dec. 17, when it will hold a products showcase, Armstrong said during a conference call.

“We’ve been heads down working on the next pieces of this,” Armstrong said about the company’s vision to become a place offering every financial capability a consumer needs, an “everything app.”

The company also continues to be interested in acquisitions, particularly in trading and payments, Coinbase’s executives said.

Coinbase shares have increased 32% this year.