The largest U.S. cryptocurrency exchange had first-quarter revenue of $1.6 billion, a 72% increase from the previous quarter. Coinbase's reported net income was $1.18 billion (or ($4.40 per share), driven by increased trading thanks to a rally in the broader crypto market.
Consumer transaction revenue doubled from the previous quarter to $935.2 million, and transaction volume increased more than 93% to $56 billion. Meanwhile, institutional trading increased even more significantly, with revenue up 133% quarter over quarter to $85.4 million and trading volume more than double his to $256 billion. Bitcoin accounted for one-third of consumer and institutional transactions.
According to MSNBC, the numbers were well above analysts' expectations for sales of $1.34 billion and net income of $1.09 per share. Shares rose nearly 9% to nearly $229 early Thursday before falling slightly in after-hours trading. A year ago, they were barely trading at $51.
Looking at its earnings more broadly, in the first quarter of last year, the company reported a loss of $78.9 million, or 34 cents per share. Additionally, his Coinbase Ebitda (earnings before interest, taxes, depreciation, and amortization) for this first quarter was $1 billion, more than all of last year.
“We have made meaningful progress against our 2024 priorities of revenue, utilities and regulatory clarity,” the company said in a letter to shareholders accompanying its quarterly report. “Our market share in US spot and derivatives increased, reaching an all-time high on Coinbase Prime, and USDC market capitalization increased.”
Base, the company's Ethereum Layer 2 chain on which Coinbase collects fees, brought in $56.1 million following its launch in August. Also, Ethereum's transactions have doubled, and developer activity on the network has increased by 800%. In the same month, Coinbase also announced that it would acquire a minority stake in Circle, the issuer of the stablecoin USDC, which saw its market capitalization increase by 30% in the first quarter. As a result, Coinbase's subscription and services revenue increased by a third, including a 15% increase in stablecoin revenue.
Coinbase may be diversifying its revenue streams with Base and USDC, but most of its recent gains have been the result of favorable market conditions. For example, the price of Bitcoin rose 57% during this quarter, reaching an all-time high of $73,000. This comes as more than $50 billion has been invested in 10 spot ETFs that the stock exchange approved on January 11th. commission.
However, the company's transaction costs rose 73% to $217 million. Heading into the second quarter, the company estimates total expenses to reach $890 million, primarily due to higher expenses related to increased transaction volumes, such as customer support and infrastructure costs. the company said in a report.
