Coinbase reported third-quarter total revenue of $1.22 billion on Thursday, 29 Oct, down 35% from $1.87 billion a year earlier, according to its quarterly filing. Transaction revenue fell 44% to $590.2 million.
Net income rose to $718.7 million, from $432.6 million.
The two numbers fit together once you look below the operating line. Coinbase’s operating income was $61.7 million, against $480.5 million a year earlier.
The rest came from a $715.0 million net gain on crypto assets it holds for investment, the filing shows. Without that gain, pre-tax profit would have been about $109 million.
The business model, in one sentence: Coinbase earns fees when people trade and interest when they hold USDC, and this quarter the second half carried the first.
The numbers
Revenue from subscriptions and services, mostly stablecoin interest and staking, slipped 20% to $570.2 million, or 49% of net revenue. Coinbase held an average of $22 billion of USDC in its products, according to its shareholder presentation.
Trading was the weak spot. The filing ties consumer transaction revenue to a 59% drop in consumer spot trading volume, partly offset by prediction markets and derivatives. Institutional spot volume fell 53%.
Coinbase still gained ground in a shrinking market. Its share of crypto trading volume rose to 10.7%, from 5.6% a year earlier, a fourth straight quarterly gain. Prediction markets passed $200 million in annualized revenue, and paid Coinbase One subscribers rose 24%, according to the company’s release.
On Coinbase’s preferred non-GAAP yardstick, adjusted EBITDA, the quarter came to $332.9 million, against $800.7 million a year earlier and 60% above the second quarter. Coinbase has spent $2.0 billion buying back 10.2 million Class A shares and has $2.0 billion of authorization left.
The skeptics
The filing gives skeptics their material.
Monthly transacting users fell to 7.4 million from 9.3 million, which Coinbase put down to fewer trading users. Assets on the platform dropped to $376.6 billion from $515.9 billion, mostly because of lower crypto prices. For the first nine months of 2026, Coinbase recorded a net loss of $34.9 million.
The 10-Q also lists new pre-arranged trading plans.
Chief executive Brian Armstrong adopted a Rule 10b5-1 plan on 12 Aug that could sell up to 8,167,446 Class A shares from vested options, subject to price thresholds, with an estimated start date of 16 Nov. Director Frederick Ehrsam and president Emilie Choi adopted plans covering up to 3,866,620 and 1,560,453 shares. Such plans are set in advance, under SEC rules that let insiders sell on a pre-agreed schedule.
What’s next
Coinbase’s outlook is cautious. Transaction revenue was about $165 million in the fourth quarter through 25 Oct, and it expects subscription and services revenue of $550 million to $630 million, the presentation shows. It lowered its full-year adjusted expense outlook to $4.15 billion to $4.30 billion.
The INTX and Deribit integration was completed in October, and a relaunched Coinbase Pro is due in the fourth quarter. Earlier this week, Coinbase dealt with an Amplitude vendor incident.
Coinbase shares closed 1.1% lower at $160.59 before the results. Bitcoin slid to $78,200 soon after, as covered in Thursday’s US close; see also Strategy’s results.
Armstrong’s plan window opens on 16 Nov.
Related: Hours later, Coinbase blocked sends to wallets tied to the Binance hack
Related: The next day, Coinbase shares fell about 13% as Barclays and Mizuho cut their price targets
This article is for information only and is not investment advice.