Coinbase will publish its second-quarter earnings report on August 10, 2021. Considering the Q1 earnings report, this guide will forecast the company’s second-quarter earnings report.
On May 13, Coinbase released its first-quarter earnings report, indicating that growing bitcoin prices increased its Q1 net income to $771 million.The cryptocurrency exchange claimed in a letter to shareholders that it had a successful first quarter, with the crypto market size approaching nearly $2 trillion by the conclusion of the fiscal quarter, up from $782 billion at the same time the year before [1].
Trading volume in Q1 was $335 billion, with retail accounts accounting for $120 billion and institutional funds accounting for $215 billion. Cryptocurrencies like BTC and ETH topped the platform’s trading volume, bolstered by recent Ethereum blockchain upgrades and a rise in public interest. As of March 31, 2021, the platform’s assets equaled $223 billion, accounting for a sizable 11.3% of the overall market cap of crypto assets.
In the last quarter, Coinbase retail transaction revenue was $1.5 billion, marking the company’s first quarter with sales over $1 billion. The company stated that it intends to boost its marketing efforts through 2021 in order to raise awareness of its dominance in the cryptocurrency trading industry [1]. Despite its good first-quarter performance, the company stated that growing competition and new coin offers continue to pose hurdles. Average transactional customers more than doubled from 2.8 million to 6.1 million in the preceding quarter.
Coinbase’s 56 million verified customers, along with the crypto market’s record-breaking price movements, caused trade volume to more than double from the previous quarter. When asked about the future, the firm stated that they expect approximately $35 million in one-time expenses connected to the company’s direct listing in the second quarter of 2021.
Coinbase expects its technology and development spending and general and administrative expenses to reach between $1.3 billion and $1.6 billion in 2021, excluding stock-based compensation, as it scales its operations and continues to drive product innovation [1].
Moreover, Coinbase intends to support its traditionally high organic growth with customer acquisition and engagement by significantly expanding its spending in sales and marketing.
According to a new Goldman Sachs memo, Coinbase is on track to outperform Wall Street’s expectations for its second-quarter financial results.
In a note to clients, experts on the Goldman Sachs derivatives team stated that the recent parade of adverse crypto stories could unexpectedly help lead to an earnings surprise [2].
Coinbase stock technical analysis
Since appearing on the USA100 under the ticker symbol Coinbase in April, Coinbase stock has been moving downwards. The recent low came on July 19 at $212.13. The company’s recent high came on June 25, when it passed above the $265 mark.
From a technical standpoint, the 9-day moving average suggests that COIN is moving into a positive trajectory. Coinbase key resistance level is at $270, which it managed to breach in May. If the price breaks above this level, we can see the crypto company going towards the $290 level.
Although the overall trend seems positive, Coinbase is holding its support level at $212 [3].
- https://s27.q4cdn.com/397450999/files/doc_financials/2021/q1/Q1’21-COIN-Shareholder-Letter.pdf
- https://finance.yahoo.com/news/goldman-sachs-calls-coinbase-tactical-212210775.html
- https://stockanalysis.com/stocks/coin/
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Adnan Abdul Rehman
Regional Market Analyst
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