Coinbase Earnings: Wall Street Analysts Expect 31% EPS Decline QoQ

Coinbase Global, Inc. (COIN) is anticipated to release its earnings report on August 1, 2024. This upcoming date, derived from historical reporting patterns, may be adjusted once Coinbase confirms the actual earnings date. As the earnings report approaches, Wall Street analysts are predicting significant changes in the company’s financial performance.

What To Expect From Coinbase Q2 Earnings?

According to Zacks Investment Research, based on forecasts from seven analysts, the consensus earnings per share (EPS) for the Coinbase’s upcoming quarter is $1.13. This represents a staggering 369.05% increase year-over-year, compared to an EPS of -$0.42 for the same quarter last year. Despite this impressive year-over-year growth, the EPS forecast signals a notable decline of 31% quarter-over-quarter. The company reported $1.65 EPS in the first quarter of fiscal year 2024.

This decrease is primarily attributed to lower trading volumes in the crypto market, following a significant drop in Bitcoin (BTC) price. Since April, Bitcoin experienced a sharp decline from a high of $72,000 to $53,000 lately owing to the German government selloff and Mt. Gox repayments. However, BTC recently rebounding above $59,000, breaking free from the downtrend.

In addition to Zacks’ estimates, Yahoo Finance estimates also offer a pessimistic outlook. Based on the consensus of 17 analysts, the EPS for the quarter is expected to be $1.06. This estimate also indicates a 36% decline quarter-over-quarter. Nonetheless, the estimate offers a robust year-over-year outlook as analysts expected Coinbase Q2 earnings per share to witness a 352% year-over-year surge.

Last quarter, COIN significantly exceeded EPS expectations by 58.65%. However, Zacks Research projects that the company may fall short of the current EPS estimate by 15.16%. This potential miss reflects the challenges Coinbase faces in navigating the volatile cryptocurrency market.

On the revenue front, analysts estimate that Coinbase will report $1.47 billion for the quarter, marking a robust year-over-year increase of 107.83%. This growth highlights the company’s ability to expand its revenue base despite market fluctuations. However, it also indicates a 7% drop quarter-over-quarter.

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Overview Of Q1 Earnings Report

Earlier, in Q1 2024, Coinbase reported exceptional earnings, significantly surpassing analysts’ projections. The reason for this impeccable performance was the surge in crypto assets and positive market sentiment boosted Coinbase’s revenue. Furthermore, the quarterly results showed revenues more than doubling to $1.58 billion, far exceeding the anticipated $1.32 billion.

In addition, transaction revenues surged to over $1 billion from the previous quarter. It was driven by increased activity from both retail and institutional clients. Moreover, institutional investors notably boosted trading volumes, contributing to the overall growth. Meanwhile, net income reached $1.17 billion, equating to $4.40 per share, marking a stark contrast to the previous year’s Q1 loss of $79 million, which occurred during a market downtrend.

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