Coinbase Q3 2024 Earnings Report
Key Takeaways
Coinbase reported a solid Q3 2024 with $1.2 billion in total revenue and $75 million in net income. The company achieved its 7th consecutive quarter of positive Adjusted EBITDA, reaching $449 million. Growth in staking, on-platform USDC, and custody helped diversify revenue, while advancements in stablecoin integration and the Base network contributed to crypto utility.
Total revenue was $1.2 billion, a 17% decrease Q/Q.
Net income reached $75 million, inclusive of $121 million in pre-tax losses from crypto asset investments.
Adjusted EBITDA was $449 million, marking the 7th consecutive quarter of positive adjusted EBITDA.
The company ended the quarter with $8.2 billion in $USD resources, up $417 million Q/Q.
Coinbase
Coinbase
Coinbase Revenue by Segment
Coinbase Revenue by Geographic Location
Forward Guidance
Coinbase anticipates Q4 subscription and services revenue to be within $505-$580 million. Technology & development and general & administrative expenses are expected to range from $690-$730 million. Sales and marketing expenses are projected to be between $170-$220 million.
Positive Outlook
- The company updated its vesting schedule for new awards to achieve linear expense recognition.
- Future stock-based compensation expenses related to annual grants will be primarily driven by our employee population rather than our vesting schedule.
- Sales and marketing expenses are expected to be in the range of $170-$220 million, primarily driven by USDC rewards expense related to higher on platform balances and higher brand spend, partially attributable to our NBA partnership.
- Transaction revenue for October is estimated to be approximately $190 million.
- The company will host a conference call to discuss the results for the third quarter 2024 on October 30, 2024 at 2:30 pm PT.
Challenges Ahead
- Q4 range reflects certain headwinds, including an observed 10% decline in the average price of Ethereum in October as compared to Q3 average and interest rate cuts reflecting market expectations.
- Variable marketing costs can fluctuate greatly depending on USDC assets on platform, market trends, and the opportunities available that meet our customer cost of acquisition targets.
- Estimating October total transaction revenue will be approximately $190 million, caution is urged in extrapolating these estimated results.
- We expect technology & development and general & administrative expenses to be in the range of $690-$730 million.
- We expect Q4 subscription and services revenue to be within $505-$580 million.