Coinbase drops 10% after earnings, heads for worst day in more than a year

Coinbase shares were under pressure Thursday, a day after the company reported weaker-than-expected earnings and gave a tepid revenue outlook for the current quarter.

The stock lost 10.6%, putting it on pace for its biggest drop since June 2023, when it fell 12.1%. A broader market decline also pressured Coinbase.

Other crypto-related stocks fell as well. Robinhood, which also reported weak earnings Wednesday, tumbled 15%. Miners Mara Holdings and Riot Platforms slid 8% and 11%, respectively.

Bitcoin, which is often a big influence on the price of Coinbase, slid 2% after hovering below its all-time high this week.

Devin Ryan, an analyst at JMP Securities, chalked it up to a temporary unwind in crypto-related names and called it an opportunity for longer-term focused investors in Coinbase and Robinhood.

"There is a lot that's going to happen here over the next couple months – [like] the U.S. election [and] ramifications of that – that will be become the much bigger story for the space, not to mention the recent appreciation in crypto prices and volume could put upward pressure on fourth-quarter revenue if the trend continues over the next two months," said Ryan, who has an outperform rating on Coinbase.

"Near-term, people will have to recalibrate a bit in their models for the blended take rate assumption," or the percentage of revenue Coinbase keeps from a transaction, he said. "Nothing structural occurred here, but as stablecoin trading volume has increased, that comes at a lower spread, and the fourth-quarter implied revenue guide was a bit soft."

Owen Lau, an analyst at Oppenheimer with a buy rating on Coinbase, put Thursday's drop on the warning that subdued volume could persist going forward and that lower U.S. interest