Coinbase Posts $394.1 Million First-Quarter Net Loss; Shares Drop After Hours

Coinbase Global Inc., the U.S. cryptocurrency exchange, reported first-quarter results that missed market expectations, extending its run of quarterly losses and sending the stock lower in after-hours trading.

Cointelegraph reported on May 8 that Coinbase posted a net loss of $394.1 million in the first quarter, compared with net income of $65.6 million a year earlier.

The company also recorded a net loss of $667 million in the fourth quarter of last year, marking a second consecutive quarterly loss.

First-quarter revenue was $1.41 billion, below the market forecast of $1.5 billion.

Transaction revenue, its core business, fell 40% from the previous quarter. Subscription and services revenue, which comes from non-trading businesses, declined 13.5% from a year earlier.

Earnings per share were negative $1.49, versus market expectations for a profit of $0.36 a share.

After the earnings release, Coinbase shares fell about 4.7% in after-hours trading to below $184. The stock has dropped about 14.5% this year.

Chief Financial Officer Alesia Haas cited a difficult macroeconomic environment. Total cryptocurrency market capitalization and trading volume both fell more than 20% from the previous quarter, she said.

Chief Executive Officer Brian Armstrong emphasized plans to diversify Coinbase's trading-focused business model.

Coinbase is shifting from a platform centered on spot trading to one that supports trading across multiple asset classes.

The company has also been pushing to expand its prediction-market business while pursuing cost cuts. On May 5, it announced plans to reduce its workforce by about 700 employees, or roughly 14%.