727 FinanceCompiled by: Felix, PANews
Crypto trading platform Coinbase today announced its financial results for the third quarter of 2026. The report shows third-quarter revenue of $1.216 billion, down about 35% year-over-year and below the expected $1.233 billion; net income of $719 million, up about 66% year-over-year, ending a streak of losses in the previous three consecutive quarters.
However, nearly all of the profit came from its crypto asset investment portfolio. Therefore, although Coinbase achieved a turnaround to profitability in the third quarter, its stock (COIN) still fell 4.74% in after-hours trading following the earnings release.
Adjusted net income fell 82% year-over-year; market share grew for four consecutive quarters
Coinbase's total third-quarter revenue was essentially flat versus $1.22 billion in the previous quarter, holding at $1.216 billion. Net income was $719 million (including $715 million in unrealized gains on its crypto asset investment portfolio). Excluding investment gains and losses and related tax items, adjusted net income was $77.7 million, down 82% year-over-year; adjusted EBITDA grew 60% quarter-over-quarter to $333 million, above the market expectation of about $290 million, and has remained positive for 15 consecutive quarters.
Affected by crypto asset volatility falling to a multi-year low, trading revenue declined 1% quarter-over-quarter to $590 million.
Of that, retail user trading revenue was $450 million, essentially flat quarter-over-quarter; institutional trading revenue was $92 million, down 8% quarter-over-quarter, broadly in line with the overall market decline. Other trading revenue was $48 million, up 2% quarter-over-quarter.
In terms of trading volume, Coinbase's total crypto trading volume in the third quarter reached $1.214 billion, with market share rising to 10.7%, growing for four consecutive quarters. Of that, spot trading volume was $134 million, down about 10% quarter-over-quarter, reflecting a phased slowdown in market spot trading activity; derivatives business trading volume was $986 million, also declining.
Subscription services accounted for 49% of net revenue; prediction market annualized revenue exceeds $200 million
Although trading activity pulled back with the overall market, Coinbase showed strong growth this quarter in diversified revenue streams such as prediction markets, derivatives, and subscription services, providing relatively stable revenue support.
In the third quarter, Coinbase's prediction market business annualized revenue exceeded $200 million. Since the product launched, quarterly compound growth in prediction market business revenue has reached 82%, and daily active traders grew more than 60% quarter-over-quarter.
Subscription and services revenue rose 3% quarter-over-quarter to $570 million, accounting for about 49% of net revenue of $1.16 billion, nearly half, demonstrating strong countercyclicality.
Of that, stablecoin revenue was $307 million, up 5% quarter-over-quarter, mainly driven by record-high average USDC balances held across Coinbase products and higher interest rates. Blockchain rewards revenue was $86 million, up 3% quarter-over-quarter; other services and subscriptions (S&S) revenue was $109 million, down 4% quarter-over-quarter.
Notably, the number of paid Coinbase One subscribers hit a record high, up 24% year-over-year. Official data shows that Coinbase One users generate average revenue per user (ARPU) 3.5 times that of ordinary users, and their average account asset balance is 4.2 times as high. The average USDC balance custodied on the platform reached $22 billion, a record high for 14 consecutive quarters, accounting for about 30% of total USDC in global circulation. Over the past year, Coinbase accounted for about 50% of all USDC economic activity.
In addition, cumulative trading volume of tokenized stocks running on Base has surpassed $1 billion.
Coinbase management said in its shareholder letter and earnings call that its prediction market and derivatives businesses (together accounting for about 25% of trading revenue) have low correlation with spot market volatility, and together with subscription services accounting for nearly half of net revenue, this significantly enhances the company's resilience across different market cycles.
In the fourth quarter, Coinbase will continue to advance its agent trading interface, Base ecosystem development, and further optimization and upgrading of the Coinbase Pro professional trading platform.
Related reading: Coinbase Q2 earnings: net loss exceeding $350 million, prediction market revenue doubles