Coinbase Q2 earnings miss Wall Street estimates with disappointing numbers

Coinbase failed Wall Street’s expectations in Q2 2025, pulling in $1.5 billion in revenue and $1.4 billion in net income, according to the company’s quarterly filing.

The figures include a $1.5 billion unrealized gain from strategic investments and another $362 million from its crypto holdings. Even without those, Adjusted Net Income stood at $33 million, and Adjusted EBITDA reached $512 million.

Transaction revenue came in at $764 million, while subscriptions and services brought in $656 million, fueled by rising USDC balances, increased staking activity, and record Prime Financing balances.

By the end of June, Coinbase had $9.3 billion in U.S. dollar resources and $1.8 billion in crypto assets held for investment, thanks to consistent weekly Bitcoin purchases. They also reported the highest average custody share in their history, signaling stronger control over crypto asset safekeeping on their platform.

Coinbase rolls out new derivatives, boosts app platform, and targets payments

During the quarter, Coinbase pushed forward with its on-chain strategy by expanding crypto trading, financial tools, and its software infrastructure. On the trading side, it introduced the widest set of CFTC-approved perpetual futures contracts in the country, which drove record volume and open interest on its international derivatives exchange. At the same time, it kept listing new spot assets and grew its presence in global markets.

Coinbase also continued expanding USDC usage by integrating it into Shopify Payments, Coinbase Business, and the Coinbase One Card. These moves brought stablecoin utility closer to daily consumer spending. The company said average USDC balances rose 13% from the last quarter, reaching $13.8 billion, helped by the reintroduction of a rewards program.

As part of its lending efforts, Coinbase grew its Prime Financing operation to new highs, serving corporates, miners, hedge funds, and asset managers. According to the company, 16 of its 25 biggest institutional clients now use its financing tools.

The firm also offered retail users up to $1 million in instant USDC loans, backed by BTC and settled on-chain through the Morpho protocol. Those loans now exceed $1 billion in open collateral.

Meanwhile, Shopify merchants across the U.S. are now able to accept USDC, and customers who use it get 1% back in rewards, with a full rollout expected later this year.

Q2 operating expenses spiked by $193 million, or 15%, mostly due to a $307 million charge linked to the data breach that was revealed in May. However, other major costs (tech, admin, and marketing) dropped 2%, totaling $977 million. Coinbase reported a full-time headcount of 4,279 employees.

Although the company’s total dollar resources dropped 6% quarter-over-quarter, ending at $9.3 billion, Coinbase still has access to $12.1 billion when counting its crypto held for investment and as loan collateral. Of that, $951 million was held as collateral, and the company added $222 million in BTC during the quarter through routine weekly buys.

Custody operations also scaled up. Coinbase now holds $245.7 billion in crypto under custody, the highest share of global crypto market cap it’s ever had. It also manages over 80% of all BTC and ETH ETF assets based in the U.S.

New crypto laws and tokenized assets set the stage for the next phase

Coinbase’s quarter closed as Washington began loosening up on crypto regulation under the Trump administration. In July, Congress passed the CLARITY Act, and President Trump signed the GENIUS Act into law. The two bills give regulatory clarity for stablecoins and crypto market structure, a win for Coinbase and its long-term roadmap.

At the same time, the company announced plans for an “everything exchange” that brings tokenized stocks, real-world assets, derivatives, and prediction markets on-chain. Max Branzburg, Coinbase’s VP of Product, said the rollout will start in the U.S. and expand globally once jurisdictions give the green light. “We’re building an exchange for everything,” Max said in an interview with CNBC. “Everything you want to trade, in a one-stop shop, on-chain. … We’re bringing all assets onchain—stocks, prediction markets, and more.”

CEO Brian Armstrong said he wants Coinbase to be the top financial app in the world over the next decade. That includes pushing further into consumer tools, expanding tokenized products, and using new regulatory support to go global faster.

As for Q3, Coinbase expects transaction revenue for July to hit $360 million. Full quarter projections show $665 to $745 million in subscription and service revenue, driven by USDC’s record market cap and higher crypto prices. Tech and admin costs are expected between $800 and $850 million, with marketing expenses ranging from $190 to $290 million, depending on performance-based campaigns and USDC user engagement.

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