Coinbase Q3 Revenue Flat as Adjusted EBITDA Rises 60%

Coinbase Global Inc. (NASDAQ: COIN) reported nearly unchanged third-quarter revenue as low crypto volatility and weaker market trading activity pressured transaction income, while lower operating costs helped adjusted EBITDA rise 60% from the previous quarter. The company also narrowed and reduced its 2026 adjusted-expense outlook by $100 million at the midpoint.

Total revenue was $1.216 billion for the quarter ended September 30, down 35% from a year earlier and broadly flat from $1.220 billion in the second quarter. Net revenue increased 1% sequentially to $1.161 billion, while other revenue fell 16% to $55 million.

GAAP net income was $719 million, or $2.51 per diluted share, compared with a net loss of $359 million in the prior quarter and net income of $433 million a year earlier. The latest result included $715 million of net gains on crypto assets held for investment. Adjusted net income, which excludes tax-adjusted gains and losses on crypto holdings and other investments, was $78 million.

Adjusted EBITDA increased to $333 million from $208 million in the second quarter, marking Coinbase’s 15th consecutive positive quarter on that measure. It remained 58% below the year-earlier level.

Low volatility weighs on trading revenue

Transaction revenue declined 1% sequentially and 44% year over year to $590 million. Coinbase said total market crypto trading volume fell 10% from the previous quarter, while its measure of crypto-asset volatility dropped 15% to multiyear lows.

Consumer transaction revenue was approximately flat quarter over quarter at $450 million. A 9% decline in consumer crypto spot volume and a 6% decrease in crypto derivatives volume were partly offset by continued growth in prediction markets. Institutional transaction revenue fell 8% to $92 million, broadly tracking weaker market activity, while other transaction revenue increased 2% to $48 million.

Coinbase’s total trading volume declined to $1.214 trillion from $1.300 trillion in the second quarter. Crypto spot volume fell to $134.5 billion from $146.4 billion, and crypto derivatives volume decreased to $963 billion from $1.027 trillion.

Despite lower activity, Coinbase said its crypto trading-volume market share rose for a fourth consecutive quarter, reaching 10.7% from 10.3% in the second quarter and 5.6% a year earlier. The company attributed the gains to both spot and derivatives, including global stablecoin demand and momentum across its derivatives products.

Prediction markets generated more than $200 million in annualized revenue during the quarter, with revenue posting an 82% quarterly compound growth rate since launch. Average daily traders increased more than 60% sequentially. Coinbase said users of prediction products also generated incremental spot-trading volume.

Subscription and services provide greater revenue mix

Subscription and services revenue rose 3% from the second quarter to $570 million, though it declined 20% year over year. The category accounted for 49% of net revenue, up from 48% in the previous quarter.

Stablecoin revenue increased 5% sequentially to $307 million. Average USDC held in Coinbase products reached a record $22 billion, representing about 30% of average USDC market capitalization. Coinbase attributed the increase partly to the full-quarter effect of Hyperliquid’s USDC balance and said higher interest rates also supported stablecoin revenue, partially offset by lower off-platform balances.

Blockchain rewards revenue rose 3% to $86 million, reflecting asset-price effects and growth in native units staked. Interest and finance-fee income increased 4% to $69 million as the average daily loan-book balance reached a record. Other subscription and services revenue declined 4% to $109 million, as record paid Coinbase One subscriptions only partly offset lower milestone-based partnership and other revenue.

Assets on platform rose to $377 billion from $246 billion at the end of the second quarter, aided by higher crypto prices. They represented 12.5% of total crypto market capitalization, returning to the peak share reported in the presentation and remaining flat year over year.

Costs fall and full-year expense outlook narrows

Total operating expenses declined 13% sequentially to $1.154 billion. Adjusted expenses, a non-GAAP measure excluding acquired-intangible amortization from technology and development, sales and marketing, and general and administrative costs, fell 6% to $975 million and came in below Coinbase’s prior quarterly outlook of $980 million to $1.080 billion.

Technology and development expense declined 5% to $447 million, primarily reflecting a full quarter of benefits from cost reductions implemented in May. General and administrative expense fell 11% to $319 million on lower professional-services spending. Sales and marketing expense increased 1% to $243 million as higher USDC rewards outweighed lower media and event spending.

Coinbase now expects full-year 2026 adjusted expenses of $4.15 billion to $4.30 billion, compared with its previous range of $4.20 billion to $4.45 billion. The company expects related GAAP technology and development, general and administrative, and sales and marketing expenses of $4.29 billion to $4.45 billion, including $140 million to $150 million of intangible-asset amortization.

For the fourth quarter, Coinbase forecast subscription and services revenue of $550 million to $630 million and adjusted expenses of $1.007 billion to $1.157 billion. Transaction revenue totaled approximately $165 million through October 25, though the company cautioned against extrapolating that figure. It expects transaction expenses to remain in the mid-teens as a percentage of net revenue and stock-based compensation of about $240 million.

Management said the completed integration of INTX and Deribit could create near-term trading-volume volatility as participants adjust to the combined platform. Broader risks include crypto-asset price volatility, changes in trading activity and interest rates, competition, regulatory developments, execution of acquisitions and international expansion, and the growth and regulatory treatment of derivatives and prediction markets.