Coinbase, the leading cryptocurrency exchange platform, reported its fourth-quarter earnings on Thursday, surpassing analysts’ expectations and sending its shares soaring. The company posted revenue of $2.8 billion, up 71% from the previous quarter and beating the consensus estimate of $2.6 billion.
The company reported a net income of $1.3 billion, a 25% increase from the previous year. The revenue was driven by strong growth in trading volume, fees, and subscriptions, as well as new products and services such as Coinbase Earn, Coinbase Card, and Coinbase Commerce.
Its net income was $1.3 billion, or $6.42 per share, compared to $0.29 per share in the same period last year. Coinbase attributed its strong performance to the increased adoption and demand for crypto assets, as well as its diversified product offerings and global expansion.
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Coinbase’s earnings report came amid a volatile period for the crypto market, which saw Bitcoin reach a new all-time high of over $69,000 in November, before plunging to below $40,000 in December. The company said it had 73 million verified users at the end of 2021, up 13% from the third quarter, and 7.4 million monthly transacting users, up 26%. It also said it had more than $223 billion in assets on its platform, representing 13% of the total crypto market share.
Coinbase’s shares jumped more than 10% in after-hours trading following the earnings release, reaching $281.50 as of 5:30 p.m. ET. The stock has gained more than 40% since its direct listing in April 2021, when it debuted at $250 per share. Analysts have been bullish on Coinbase’s prospects, citing its leadership position in the crypto space, its strong revenue growth and profitability, and its potential to benefit from the mainstream adoption of digital currencies.
Coinbase also provided guidance for the first quarter of 2022, projecting revenue of $2.4 billion to $2.6 billion, and net income of $800 million to $1 billion. The company said it expects to have 75 million to 80 million verified users, and 8 million to 9 million monthly transacting users by the end of March. It also said it plans to invest more in product innovation, customer service, regulatory compliance, and social impact initiatives in the coming year.
Coinbase’s CEO Brian Armstrong said in a letter to shareholders that the company’s mission is to increase economic freedom for everyone in the world, and that it is well-positioned to achieve that goal. “We believe that crypto is not only the future of finance, but also a powerful force for good in society,” he wrote. “We are proud of what we accomplished in 2021, and we are excited about the opportunities ahead in 2022 and beyond.”
Coinbase also highlighted its achievements in expanding its global presence, supporting more than 100 countries and 50 fiat currencies. The company added over 20 million verified users in 2023, bringing its total user base to over 80 million. Coinbase also increased its assets on platform to $320 billion, representing more than 10% of the total market capitalization of cryptocurrencies.
The company attributed its success to its mission of creating an open financial system for the world, and its vision of becoming the most trusted and easiest to use platform for anyone to access cryptocurrencies. Coinbase said it will continue to invest in innovation, security, compliance, and customer service to deliver the best experience for its users and partners.
Coinbase’s positive balance sheet for 2023 reflects the growing adoption and acceptance of cryptocurrencies as a legitimate and valuable asset class. The company’s performance also demonstrates its leadership and resilience in a highly competitive and dynamic industry. Coinbase is well-positioned to capitalize on the opportunities and challenges that lie ahead in the crypto space.