Coinbase Inc. Earnings Report (Q3 2021)

Coinbase has reported strong yet variable results for Q3 2021, customer engagement is higher but Q3 shows a decrease in Monthly Transacting Users.
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3 min read
Bitcoins

2021 has seen a huge increase in popularity for cryptocurrencies and Coinbase has been positioned well to capitalise on that popularity. The Q3 2021 results from the company show that more funds than ever is being invested into crypto.

  • Q3 2021 Net Revenue: $1.2 billion. Up from $287 million in Q3 2020. Net revenue was slightly lower than most predictions and is lower than the $2 billion they reported in Q2 2021.
  • Q3 2021 Net Income: $406 million. Up from $81 million in Q3 2020, but significantly down from $1.6 billion it reported in Q2 2021.
  • Adjusted EBITDA for Q3 2021 of $618 million. Up from $123 million in Q3 2020. In Q2 2021, EBITDA came in at $1.15 billion.
  • Net income per share for Q3 2021: $1.92 (basic) and $1.62 (diluted). For one year ago in Q3 2020: $0.25 (basic) and $0.23 (diluted).

Coinbase has had some variable changes in its user base:

  • In Q3 the total verifed users has now grown to 73 million.
  • In Q3 2021 Coinbase had 7.4 million Monthly Transacting Users. While this is an improvement from Q3 2020 where the company saw only 2.1 million Monthly Transacting Users, when compared to the previous quarter (Q2 2021), the company reported a figure of 8.8 million, which is a decrease of 1.4 million.

Despite the quarterly decrease in Monthly Transacting Users, Coinbase did manage to grow the total of assets on the platform:

  • In Q3 2021 the total assets on Coinbase was: $255 billion. An increase of $219 billion since Q3 2020 a year ago.
  • In the previous quarter (Q2 2021) the total assets on Coinbase was: $180 billion. This shows an increase of $75 billion in Q3.

Coinbase also has reported that the company has 2.8 million users who were earning yield on their crypto assets. 49% of retail Monthly Transacting Users engaged with investing products from Coinbase such as: Staking, Earn and Coinbase Card.

Coinbase has said:

“We are in the early stages of the development of the cryptoeconomy and are focused on investing for long-term growth. As our year-to-date results have clearly demonstrated, our business is volatile. Coinbase is not a quarter-to-quarter investment, but rather a long-term investment in the growth of the cryptoeconomy and our ability to serve users through our products and services. We encourage our investors to take this point of view.”

Coinbase recently announced they will be launching ‘Coinbase NFT’, it will allow users to mint, collect, discover and showcase their NFT’s. The launch is yet to have a date set and it is yet to be seen exactly how attractive the offering will be compared to other services.

Coinbase predicts total trading volume and Monthly Transacting Users will be higher next quarter (Q4 2021).

The company has also provided two predictions for the full year of 2021, both a high and low prediction has been given:

Since the Earnings Report was released, Coinbase stock has fallen by around 14.93% in after hours trading to around $304. The stock is up around 8.87% since the start of 2021.

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