Coinbase — Q3 2026 Earnings Summary

Financial Performance:

• Total revenue was $1.2 billion, flat quarter-over-quarter (Q/Q) and down 35% year-over-year (Y/Y).
• Net income was $719 million, a 66% increase Y/Y and a 300% increase Q/Q.
• Adjusted EBITDA was $333 million, up 60% Q/Q and down 58% Y/Y.
• Subscription and services revenue was $570 million, up 3% Q/Q and down 20% Y/Y, representing 49% of total net revenue.
• Transaction revenue was $590 million, down 1% Q/Q and 44% Y/Y.
• Adjusted expenses were $975 million, down 6% Q/Q and 10% Y/Y, coming in below the Q3 outlook range of $980–$1,080 million.
• Cash and cash equivalents totaled $8.6 billion.
• Transaction expense was $194.5 million, or 17% of net revenue, up 32 basis points Q/Q.

Guidance and Future Outlook:

• Q4 2026 transaction revenue is expected to be approximately $165 million quarter-to-date through October 25.
• Q4 2026 Subscription & Services revenue is guided to $550–$630 million.
• Q4 2026 Adjusted expenses are guided to $1,007–$1,157 million.
• Q4 2026 Stock-based compensation is expected to be approximately $240 million.
• Full-year 2026 Adjusted expenses guidance has been reduced and narrowed to $4,200–$4,450 million (from $4,250–$4,600 million previously).
• Management anticipates Q4 drivers including higher average interest rates, QTD average crypto asset prices, and marketing expenses driven by USDC rewards.

Business Segments and Product Lines:

• Prediction markets revenue reached $200 million in annualized run rate with 82% quarterly compound growth since launch.
• Crypto derivatives trading volume grew 179% CAGR over the last two years, with the 4th consecutive quarter of market share gains.
• INTX/Deribit integration was completed in October, creating a unified regulated exchange for U.S. and ex-U.S. customers.
• Coinbase One subscribers reached a new all-time high in Q3, with 3.5x higher ARPU, 4.2x higher balances per user, and 50%+ higher long-term trading retention compared to non-subscribers.
• Stablecoin revenue was $307 million, up 5% Q/Q, driven by a new all-time high in Average USDC Held in Coinbase Products ($22 billion).
• Blockchain rewards revenue was $86 million, up 3% Q/Q.
• Coinbase Developer Platform Total Payments Volume (TPV) grew 160% quarterly compound growth.
• Base network saw $1 billion+ in tokenized stock volume since launch and is the #1 L2 for spot crypto trading and DeFi Total Value Locked in Q3.
• Average Daily Loan Book Balance reached an all-time high, contributing $69 million in interest and finance fee income.

Market and Competitive Landscape:

• Coinbase Crypto Trading Volume Market Share reached 10.7% in Q3, the 4th consecutive quarter of growth.
• Assets on Platform (AOP) were $377 billion, representing 12.5% of the total crypto market capitalization, returning to peak levels.
• Average USDC Held in Coinbase Products was $22 billion, approximately 30% of the average USDC market capitalization.
• Total Market Crypto Spot Trading Volume declined 6% Q/Q, and Total Market Crypto Derivatives Trading Volume declined 11% Q/Q.
• Crypto Asset Volatility declined 15% Q/Q to multi-year lows.
• Total Crypto Market Capitalization rebounded 37% Q/Q in September.

Risks and Challenges:

• Macro headwinds included soft crypto market conditions, declining total market trading volumes, and low average volatility suppressing trading activity.
• Consumer crypto spot trading volume declined 9% Q/Q, and crypto derivatives trading volume declined 6% Q/Q.
• Institutional transaction revenue declined 8% Q/Q, roughly in line with market declines.
• Forward-looking statements are subject to risks including market acceptance, regulatory approvals, crypto asset price volatility, and competition.

Management Commentary and Tone:

• Management highlighted continued expense discipline and strategic investment in AI.
• The business is described as healthy with continued gains in market share and rapid scaling of prediction markets.
• Management noted that macro headwinds have begun to shift, evidenced by the September price rebound.
• Commitment to generate positive Adjusted EBITDA in all market conditions was reaffirmed, marking the 15th consecutive quarter of positive Adjusted EBITDA.
• Management emphasized the "Everything Exchange" strategy, aiming to trade every asset class (crypto, equities, prediction markets, commodities, FX) in one place.

Analyst Questions and Answers:

• No specific analyst questions and answers content was included in the provided text.

Other Key Points:

• The company repurchased 10.2 million Class A shares, returning over $2 billion to shareholders.
• $2 billion in remaining share repurchase authorization remains.
• Approximately 85% of stock-based compensation (SBC) issuance has been offset by buybacks since Q4 2024.
• The company holds $11 billion in available resources, including $2.4 billion in crypto and marketable investments.
• Strategic investments and marketable investments grew over 3x year-over-year.
• The company reported a Data Theft Incident loss/recovery adjustment in prior periods but no new incidents were highlighted in Q3 results.
• Restructuring costs were $4.6 million in Q3 2026, compared to $52.4 million in Q2 2026.