Coinbase Stock Slides Following Disappointing Earnings Report Amidst Market Instability.

Coinbase Misses Earnings Expectations, Cites Tariffs and Market Instability as Key Reasons

Coinbase (COIN) shares fell nearly 3% after hours as the company posted disappointing first-quarter results, driven by a slowdown in trading activity amid market volatility and economic uncertainty in the U.S.

The crypto exchange reported $2 billion in revenue, down from $2.27 billion in Q4, falling short of Wall Street’s forecast of $2.1 billion. Earnings per share (EPS) came in at $0.24, well below the expected $1.93, based on FactSet estimates.

In terms of trading activity, Coinbase saw a 10% decline in volume, totaling $393.1 billion in the quarter. Transaction revenues also dropped 19% to $1.3 billion compared to the previous quarter.

In a letter to shareholders, Coinbase pointed to market dynamics as a major factor, explaining that while Bitcoin reached a record high in January, crypto prices ultimately fell in line with broader market trends. These declines were linked to ongoing economic challenges, including President Donald Trump’s tariff policy and rising uncertainty in the global economy.

Ahead of the earnings release, analysts from J.P. Morgan, Barclays, and Compass Point had already lowered their expectations for the company due to the decline in trading volume, which had been sluggish since January amidst concerns over U.S. economic stability.

Meanwhile, competitor Robinhood (HOOD), which caters primarily to retail investors, also reported a 13% decline in transaction revenue for the quarter, signaling broader challenges in the market.

Despite these hurdles, Coinbase’s $2.9 billion acquisition of Deribit — a leading crypto derivatives exchange — marks a bold step forward. This acquisition positions Coinbase as the new leader in global crypto options trading, surpassing Binance and other competitors. The move is expected to spark new growth opportunities in the derivatives market, and investors will be watching how it impacts Coinbase’s future performance.