Coinbase Analysts Project Earnings Drop Ahead of First-Quarter Report
Coinbase (COIN) faces challenges ahead of its first-quarter earnings report, with four Wall Street analysts predicting a miss due to decreased retail trading activity.
Key projections include:
- EPS expected to drop to $1.93 from $2.26
- Revenue forecasted at $2.1 billion, down from $2.27 billion
- Trading volume anticipated around $403.8 billion, compared to $439 billion in the previous quarter
- Year-earlier EPS was $4.40 with revenue of $1.2 billion
Analyst insights reveal:
- J.P. Morgan reduced its EPS estimate to $1.59, citing a 10% decline in trading volume and a 17% drop in total crypto market cap
- Barclays cut revenue and EBITDA forecasts, estimating retail volumes at $69 billion, below the average of $79.8 billion
- Compass Point downgraded Coinbase to sell, projecting transaction revenue at $1.24 billion, 7% below consensus
A positive note is the increase in USDC-related revenue, projected at $304 million, helping offset losses in staking income. However, concerns grow over competition from decentralized exchanges.
Oppenheimer adjusted its volume forecast to $380 billion but noted Coinbase gained U.S. spot trading market share. Analysts warn that a rebound in trading may be slow, with many retail traders hesitant to return until they recover prior losses.
As of now, Coinbase shares are down 23% year-to-date, trading at $198.06, while bitcoin has increased by 3.8% since January, priced at $97,023.