Coinbase Global Posts a Soft Q4 Earnings: Here's How to Play the Stock

Coinbase Global Inc. COIN reported soft fourth-quarter 2025 results, wherein both the top and the bottom lines decreased year over year. While total transaction revenues dropped, subscription and services revenues increased year over year.

As the largest registered crypto exchange in the United States, Coinbase is well-placed to take advantage of increased market volatility and rising crypto asset prices. As the United States positions itself as a global crypto hub, COIN’s ambition to become an all-encompassing exchange for the industry appears well aligned.  Coinbase is poised for a strong 2026 as it executes on its long-term strategic roadmap.  

A Sneak Peek Into Q4 Results

Net operating earnings per share of 66 cents missed the Zacks Consensus Estimate by 28.2%. Total revenues of $1.7 billion missed the consensus estimate by 0.6%. Both top and bottom lines decreased year over year.

Total transaction revenues declined 36.8% year over year to $982.7 million, attributable to a decrease in consumer transaction revenues and other transaction revenues. Total subscription and services revenues increased 13.4% year over year to $727.4 million, driven by higher stablecoin revenues and other subscription and services revenues. 

Total trading volume in 2025 grew 156% year over year, while crypto trading volume market share doubled.

Net cash provided by operating activities was $2.4 billion in 2025, which declined 21.8% year over year.

Coinbase expects subscription and services revenues to be within $550-$630 million. This range reflects lower Average USDC Market Capitalization and interest rates, as well as lower average crypto prices and staking protocol rates.

Coinbase expects technology & development and general & administrative expenses to be between $925 million and $975 million, roughly flat quarter over quarter. The company expects headcount to grow at a slightly higher rate than in the fourth quarter of 2025.

Sales and marketing expenses are expected to be in the range of $215-$315 million.

Coinbase expects transaction expenses to be in the low-to mid-teens as a percentage of net revenues.

Price Performance

Shares of COIN have lost 27.3% year to date compared with its industry’s decline of 9%. The sector has risen 0.2% and the Zacks S&P 500 composite has lost 0.3% in the same time frame.

COIN vs. Industry, Sector, S&P 500

Robinhood Markets HOOD, a crypto-oriented company, has lost 32.8% year to date, while Interactive Brokers Group, Inc. IBKR has gained 16.2% in the same time frame.

Muted Analyst Sentiment for COIN

The Zacks Consensus Estimate for 2026 earnings has moved 5.6% south in the past seven days while that for 2027 witnessed no movement.

The Zacks Consensus Estimate for 2026 and 2027 revenues represents a respective 8.5% and 11.6% year-over-year increase. The consensus estimate for 2026 and 2027 EPS represents a respective 34.5% and 19.9% year-over-year increase.

The consensus estimates for 2026 and 2027 EPS of Robinhood Markets moved south in the past seven days. However, the same for Interactive Brokers Group witnessed no movement in the same time frame. 

COIN is Expensive

COIN shares are trading at a premium to the industry. Its 12-month forward price-to-earnings of 29.56X is much higher than the industry average of 11.09X. It is, however, trading lower than its median of 46.53.
 

Its Value Score of D suggests that the stock is not so cheap and indicates a stretched valuation at this moment.

COIN is, however,  cheaper than both Robinhood Markets and Interactive Brokers Group.

Investment Thesis on COIN

Coinbase is advancing its growth strategy by increasing its share of the U.S. spot and derivatives markets while expanding its product offerings and international presence. The company continues to add new cryptocurrencies and tokenized equities, maintaining a strong emphasis on launching digital assets that foster a pro-crypto ecosystem.

Looking ahead to 2026, Coinbase intends to focus on real-world asset (RWA) perpetuals, niche exchanges and sophisticated trading platforms, next-generation decentralized finance infrastructure and greater integration of Artificial Intelligence and robotics. These efforts aim to build a more integrated and comprehensive ecosystem, further strengthening its industry leadership.

Financially, Coinbase remains on a solid footing, supported by strong liquidity and ongoing debt reduction that has improved its total debt-to-capital ratio. However, the issuance of $2.6 billion in convertible notes presents potential risks, including shareholder dilution and increased leverage.

The company’s performance remains closely tied to cryptocurrency price movements. Declines in Bitcoin, Ethereum or other digital asset prices could negatively impact earnings, asset values, cash flows, liquidity and its ability to meet obligations.

To drive growth, Coinbase has stepped up spending on technology development, marketing and administrative functions. Meanwhile, pricing pressures have led to continued impairment charges, and restructuring initiatives have added to operating expenses.

What Should Investors Do?

Coinbase’s efforts to expand the crypto ecosystem, capture greater spot trading share across retail and institutional markets, and continuously enhance its platform are likely driving solid growth. Higher average USDC balances, increasing USDC market cap and steadier crypto prices may also support more stable revenues. 

However, considering its premium valuation, reduced volatility, muted analyst sentiment, weaker asset prices and below-average return on equity, it is better to shy away from the Zacks Rank #4 (Sell) stock presently. 

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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