Coinbase shares surge 13% in pre-market trading on strong fourth-quarter performance
Posted: February 16, 2024 9:17 AM Updated: February 16, 2024 9:17 AM
Correction and fact check date: February 16, 2024, 9:17 AM
briefly
Coinbase reported strong fourth-quarter results amid a surge in cryptocurrency markets, sending the company’s shares up 13% in pre-market trading.
Coinbase (COIN) experienced a notable surge following the release of its fourth-quarter earnings report, surpassing analyst expectations amid rising cryptocurrency valuations. This is the company’s first quarterly profit since 2021. Moreover, Coinbase is up 13% in pre-market trading.
The US-based cryptocurrency exchange reported earnings of $1.04 per share, well above analysts’ average estimate of $0.02 per share. Coinbase also revealed revenue figures of $953.8 million, exceeding analyst estimates of $826.1 million, as stated in the company’s official statement.
To unravel the reasons for this strong rally, it is important to note that cryptocurrency prices have experienced a steady rise throughout 2023, with a notable strengthening in the fourth quarter, primarily due to the massive expectations surrounding the approval of the Bitcoin ETF. It was finally approved in January.
These developments have therefore reignited investor interest in digital assets, contributing to a significant increase in trading activity on Coinbase. In particular, in the fourth quarter, transaction volume increased by 100% compared to the previous quarter.
The SEC’s approval of the Bitcoin ETF in January gave a boost to the cryptocurrency market, pushing the price of Bitcoin up 57% in the last three months of 2023. As a result, Coinbase’s fourth quarter profit recorded a significant turnaround of $273 million. It comes from a loss of $557 million reported in the same period the previous year.
Stablecoin revenue boosts Coinbase’s Q4 performance
Additionally, Coinbase’s Subscriptions and Services segment experienced solid growth, with first quarter 2024 revenue of between $410 million and $480 million, surpassing analyst estimates. The unit’s revenue increased by almost 33%, $375.4 million Stablecoin revenue emerged as a significant contributor in the fourth quarter.
Coinbase’s recent financial performance reflects its resilience and ability to navigate dynamic market conditions in the cryptocurrency space. The company’s first quarterly profit in two years highlights its position as a key player in the evolving digital asset landscape.
Investor enthusiasm for cryptocurrencies and Coinbase’s strong financial performance indicate increasing mainstream acceptance and adoption of digital assets. As the cryptocurrency market continues to evolve, Coinbase remains well-positioned to capitalize on new opportunities and drive further growth in the sector.
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Kumar is an experienced technology journalist specializing in the dynamic intersection of emerging fields including AI/ML, marketing technology, cryptocurrency, blockchain, and NFTs. With over three years of experience in the industry, Kumar has established a proven track record in crafting compelling narratives, conducting insightful interviews, and providing comprehensive insights. Kumar’s specialty is producing high-impact content including articles, reports and research publications for prominent industry platforms. With a unique skill at combining technical knowledge and storytelling, Kumar excels at communicating complex technical concepts in a clear and engaging way to diverse audiences.
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Kumar is an experienced technology journalist specializing in the dynamic intersection of emerging fields including AI/ML, marketing technology, cryptocurrency, blockchain, and NFTs. With over three years of experience in the industry, Kumar has established a proven track record in crafting compelling narratives, conducting insightful interviews, and providing comprehensive insights. Kumar’s specialty is producing high-impact content including articles, reports and research publications for prominent industry platforms. With a unique skill at combining technical knowledge and storytelling, Kumar excels at communicating complex technical concepts in a clear and engaging way to diverse audiences.