Coinbase Sees Stock Drop After Earnings Fall Short of Wall Street’s Market Volatility Expectations.

Coinbase Faces Post-Earnings Slump After Missed Revenue Targets Amid Tariff and Market Concerns

Shares of Coinbase (COIN) dropped nearly 3% in after-hours trading following the release of its first-quarter earnings, which came in below analysts’ expectations. The company pointed to declining crypto prices, spurred by U.S. President Donald Trump’s tariff policy and broader economic uncertainty, as factors contributing to the weak results.

Coinbase posted $2 billion in revenue for Q1, a decline from the $2.27 billion seen in the fourth quarter, and underperformed analysts’ projections of $2.1 billion. The exchange reported earnings per share (EPS) of $0.24, far below the $1.93 consensus estimate.

Trading volume dipped by 10%, reaching $393.1 billion for the quarter, while transaction revenue fell by 19% to $1.3 billion compared to the previous period.

In its letter to shareholders, Coinbase explained that while Bitcoin reached new all-time highs in January, the overall market had cooled off in the months following, primarily due to broader economic instability and market volatility driven by tariff policies.

Before the earnings report, major financial firms like J.P. Morgan, Barclays, and Compass Point had already reduced their forecasts for Coinbase as a result of a sharp drop in crypto trading activity, which has been exacerbated by the uncertain outlook for the U.S. economy.

Robinhood (HOOD), a key rival with a focus on retail traders, also saw a decline in transaction-based revenue, reporting a 13% drop in April.

On a more optimistic note, Coinbase’s $2.9 billion acquisition of Deribit, a leading crypto derivatives exchange, solidifies its position as the dominant player in global crypto options markets, surpassing competitors like Binance. This acquisition is seen as a pivotal move, positioning Coinbase to capitalize on the growing demand for crypto derivatives and expand its influence in the industry.