Coinbase Shares Drop 19.6% Following Disappointing Earnings Report
Shares of Nasdaq-listed cryptocurrency exchange Coinbase (COIN) fell 19.6% to $314.69 last week, marking its worst performance since September 2024.
Key points from the second-quarter earnings report include:
- Net operating earnings per share: 12 cents
- 88.8% year-over-year decrease in net earnings
- Revenue: $1.5 billion, below FactSet's estimate of $1.59 billion
- EBITDA: $512 million
- Transaction revenue down 39% from the previous quarter
The sell-off aligns with a late June analysis by 10x research, which indicated that COIN's price rally was overstretched relative to fundamentals. The firm recommended shorting COIN while buying BTC.
Investment firm H.C. Wainwright downgraded Coinbase from Buy to Sell, citing the second-quarter rally's disconnect from fundamentals.
Increased Demand for COIN Put Options
Traders are seeking downside protection in COIN, as evidenced by:
- One-year put-call skew rose to 2.6%, the highest since April 21
- Put options traded at a 2.6 volatility premium over call options