In its latest financial report, cryptocurrency exchange Coinbase disclosed its net income and adjusted EBITDA for the fourth quarter and full year of 2023. For Q4 2023, Coinbase reported a net income of $273 million and an adjusted EBITDA of $305 million. Over the course of the entire year, it recorded a net income of $95 million and adjusted EBITDA of $964 million. These figures indicate a strong financial performance for the company.
Coinbase experienced significant revenue growth in the fourth quarter of 2023. The total revenue for Q4 reached $954 million, marking a 41% quarter-on-quarter increase. Transaction revenue also saw a substantial rise, reaching $529 million, which is an 83% increase compared to the previous quarter. Additionally, the subscription and services revenue increased by 12% quarter-on-quarter, amounting to $375 million.
Although Coinbase observed impressive growth in Q4, its performance over the entirety of 2023 had mixed results. The total revenue for the year amounted to $3.1 billion, representing a 3% year-on-year decrease. Transaction revenue also experienced a decline of 36% year-on-year, totaling $1.5 billion. On the other hand, the subscription and services revenue showed positive growth, rising by 78% year-on-year, reaching $1.4 billion. These results indicate that Coinbase’s revenue streams have been impacted differently throughout the year.
Coinbase made efforts to strengthen its balance sheet by reducing its debt to 12% and increasing its total USD holdings to $5.7 billion. Its USD balance comprises $5.1 billion in cash and cash equivalents and $576 million in USD Coin (USDC). The company’s consolidated balance sheet reveals assets worth $207 billion, primarily consisting of $203 billion in current assets. Furthermore, Coinbase holds approximately $450 million worth of crypto assets.
Coinbase highlighted its growing international presence, having onboarded over 100 institutions to its international exchange since its launch in May 2023. It also emphasized that 80% of crypto trading occurs outside of the United States, underscoring the importance of its global reach. Additionally, the company shared its institutional activities, such as onboarding one-third of the top 100 hedge funds by assets under management in Q4 2023. Coinbase also mentioned its custodial role in eight out of eleven spot Bitcoin ETFs and its involvement with the Fairshake Super PAC. Furthermore, it addressed its ongoing attempts to dismiss Securities and Exchange Commission (SEC) charges.
Coinbase provided insights into future trends in its financial report. It revealed that it generated $320 million in total transaction revenue during the first half of Q1 2024. However, the company urged caution in extrapolating these results. Separately from transaction revenue, Coinbase predicted its subscription and services revenue for Q1 2024 to be between $410 and $480 million. The company also expects an increase in total expenses for the upcoming year.
Following the release of its financial report, Coinbase’s stock (COIN) experienced a positive market response. On February 15th, the share price rose by 5.29 points (3.3%) and continued to rise by 21.21 points (12.8%) after hours. The closing price for the day was $165.67.
Coinbase’s financial report for Q4 and the full year of 2023 demonstrates impressive revenue growth, mixed overall performance, and a strengthened balance sheet. The company’s international expansion and institutional activities also play key roles in its success. Looking ahead, Coinbase aims to sustain its growth, with cautious optimism regarding future revenue trends.
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