Coinbase (Coin) reports second quarter revenue after the market got closer on Thursday, and forecasts differ significantly on Wall Street as analysts overwhelm the decline in trading volume with the wave of regulatory development and product deployment.
Factset Consensus estimated the company’s revenues of $1.59 billion for the second quarter, up from $1.45 billion in the same period last year. Earnings per share are expected to be $1.25. But beneath these topline numbers surfaces, there is now a debate about something more important. Reduced spot volumes of encryption or Coinbase’s growing subscription and services (S&S) business (S&S) business is supported by higher interest and blockchain activities.
Barclays analyst Benjamin Bundy has a neutral rating on the coin – but has become brave for disappointment. Buddish warned that retail trading activity has dropped sharply, and that it estimates Coinbase’s trading revenue is around $741 million. He cited a quarterly quarter decline of retail volumes by 43% based on softening across centralized exchanges, based on data from Robinhood and app usage.
“In the second quarter, we believe that the correlations derived from Robinhood Trading Metrics are more suitable for Coinbase Q2 retail transaction revenue. Robinhood’s retail crypto volume was meaningfully Q/Q,” writes Buddish.
Despite this, Buddish recently raised his price target from $202 to $359. This reflects an increase in revenue amid a wider market revaluation, not to mention a doubling of stocks from its April low to its current $380. He maintains a neutral rating. I believe that the short-term headwinds are balanced with pending cryptography optimism, such as the act of genius and clarity.
City analyst Peter Christiansen is brighter. He recently raised his price target from $270 to $505, reaffirming his buy rating. Christiansen pointed to advances in the Clarity Act, which aims to create a framework for Coinbase to include in the S&P 500, the signature of the Genius Act on Stablecoins, and the distinction of Digital Commodity from securities.
“Investors are beginning to place premiums on blockchain innovations applied to real-world activities,” writes Christiansen, highlighting Coinbase’s plans for token-based stocks and new payment tools. He acknowledges a decline in Q2 volumes, but sees the long-term benefits from the monetization of USDC on Coinbase One subscription, use of the basic network, and future growth.
JPMorgan’s Kenneth Worthington has maintained its year-end neutral rating and $404 price target for 2025, taking a more modest position. His rating includes a share of Coinbase’s Stablecoin Business. He also considered the $50 million cost associated with cybersecurity breach earlier this year.
Worthington said Coinbase remains a “beneficiary of the cryptocurrency economy” and “underestimated the strength of US spot Bitcoin ETP in its early days as a key catalyst for the crypto industry.” Nevertheless, he warns that its long-term success depends on product development, particularly tokenization and payment. He sees potential rises if ETF inflows and legislative clarity continues, but he warns that Coinbase could fall below performance if he is enthusiastic about retreating Crypto or if the new rules impose higher compliance costs.
Behind these debates is the performance of Coinbase’s S&S business, which led to generating between $600 million and $680 million in that quarter. Barclays expects top guidance of $703 million in the second quarter, with USDC balances and BTC prices rising. Citi’s Christiansen believes staking growth is slowing, but we are also looking forward to new features such as the release of a refreshed wallet and crypto-powered credit card on the Amex network.
A core challenge for Coinbase is that crypto prices rebound in 2025, while trading volumes have not continued to walk. According to the block, Coinbase processed a $23.2 billion spot volume in the second quarter, falling by around 40%. Futures trading was stronger, but by June it showed signs of tapering.
Coinbase shares are currently trading at $380, up about 2% on Wednesday and 47% since the start of the year.
