Source: CoinbaseAmid a downturn in the cryptocurrency market, major exchange Coinbase reported disappointing results for the third quarter of this year. Between July and September 2022, the company posted a net loss of approximately €545 million. The latest announcement sent share prices plummeting.
“The third quarter was mixed for Coinbase. Transaction revenue was significantly impacted by stronger macroeconomic and crypto market headwinds, as well as transaction volume moving overseas,” Coinbase said in its Q2022 letter from XNUMX to shareholders.
"During this time, we have seen strong growth in our subscription and service revenue, driven by our involvement in the USDC ecosystem and increased engagement activity. Although macroeconomic headwinds are out of our control, we continue to focus on factors within our control: reduce our focus on products to deliver incredible customer experiences and reduce our operating expenses,” the letter reads.
The exchange acknowledges that its trading revenue fell 44% quarter over quarter to €366 million due to lower trading volume.
At the same time, on a more upbeat note, "Subscriptions and services revenue increased 43% sequentially to €211 million, driven by higher interest income. Third-quarter net income was €576 million , 28% less than the second quarter. »
Coinbase's total operating expenses were $1100 billion, down 38% from Q2022 XNUMX, according to the letter to shareholders.
"In the absence of non-cash impairment charges incurred, total operating expenses would have decreased 22% sequentially in the third quarter. While revenue decreased sequentially, net loss and adjusted EBITDA both improved sequentially to negative €545 million. and negative €116 million, respectively,” the company told shareholders.
The disappointing stock market results caused its share price to drop, suggesting that many investors are not convinced that the company can easily recover from its current financial situation. As of 09:00 UTC, NASDAQ-traded shares of Coinbase were priced at €55,80, which represented a decrease of 8,09% over a 24-hour period.
Commenting on its plans for 2022 and beyond, the exchange said it remains "cautiously optimistic that we will operate within the safety barrier against the €500 million Adjusted EBITDA loss that we have. This assumes that capitalization and volatility of the crypto market do not significantly deteriorate below October levels and that we do not see changes in client behaviors.
Looking ahead to 2023, the platform says it is preparing with a conservative bias, assuming "that the current macroeconomic headwinds will persist and possibly intensify."