Coinbase revenue drops 27% from a year ago, stock slides

Tue, May 10 2022

Coinbase reported first-quarter earnings that missed analyst estimates after the bell on Tuesday.

Here are the key numbers:

• Loss per share (EPS): $1.98
• Revenue: $1.17 billion, versus $1.48 billion expected, according to Refinitiv

Before the report, the stock had lost more than 60% of its value since late March, as a broader slide in tech stocks and the value of cryptocurrencies hit Coinbase particularly hard. Bitcoin dropped below the symbolic price threshold of $30,000 on Monday.

Retail monthly transaction users (MTUs) fell to 9.2 million, down from 11.4 million in the fourth quarter, while total trading volume dropped from $547 billion in Q4 to $309 billion.

The company’s revenue dropped 27% from a year ago, and it also reported a net loss of $430 million in the first quarter.

Two weeks after announcing plans to slow hiring, crypto exchange Coinbase now says the freeze will extend into the “foreseeable future.” The company will also be pulling some accepted job offers.

Coinbase said it was informing prospects of the rescinded offers by email on Thursday. The company also said it was extending its severance policy to those individuals and will help them with job placement and resume review.

Coinbase CEO Blasts Employee Petition Against Executives

June 10, 2022

Turmoil inside crypto exchange Coinbase Global Inc. COIN -7.92% has spilled out into the public.

Co-founder and Chief Executive Brian Armstrong on Friday lashed out on Twitter against an employee petition to remove several top executives, including Chief Operating Officer Emilie Choi, Chief Product Officer Surojit Chatterjee, and Chief People Officer L.J. Brock.

The petition, purportedly from Coinbase employees, appeared Thursday on a crypto site called Mirror, complaining about the company’s recent performance and demanding executives be removed. The petition appears to have been taken down, and it isn’t clear how many people signed it, or if it was legitimately written by a Coinbase employee. But it was taken seriously enough by Mr. Armstrong that he decided to address it in a public forum.

“This is really dumb on multiple levels,” he wrote.

“If you want to do a vote of no confidence, you should do it on me and not blame the execs,” he wrote. “There is probably lots we can be doing better, but if you’re at a place where you want to leak stuff externally then it’s time for you to go. You’re hurting yourself and those around you.”

Coinbase is one of the best known companies in the cryptocurrency sector, with a $13 billion market cap. It went public in April 2021 in a high-profile debut, and had several profitable quarters after that.

But the company has struggled in recent months. It lost users and posted a first-quarter loss. Most recently, it pulled back on hiring and rescinded job offers to people who had already accepted them but hadn’t started working.

“In any down market, people want to start pointing fingers and find someone to blame,” Mr. Armstrong said on Twitter.

Mr. Armstrong also said that posting the petition was “deeply unethical because it harms your fellow co-workers, along with shareholders and customers. It’s also dumb because if you get caught you will be fired, and it’s just not an effective way to get what you claim to want.”

The petition claimed there was low morale among employees, threats of top talent leaving, and an “apathetic and sometimes condescending attitude” from the executives named.

Crypto Exchange Coinbase to Lay Off 18% of Staff

June 14, 2022 8:51 am ET

Cryptocurrency exchange Coinbase Global Inc. said Tuesday that it is cutting almost a fifth of its staff as part of a restructuring plan.

The company said that it will reduce its workforce by 1,100 employees, amounting to 18% of its staff, as part of its efforts to manage operating expenses. Coinbase’s shares have plummeted this year alongside a decline in the value of cryptocurrencies. Shares fell a further 7.7% Tuesday in premarket trading after Coinbase posted the notice as part of a Securities and Exchange Commission filing.

Coinbase said it expects to have 5,000 staffers following the layoffs.

The biggest cryptocurrency exchange in the U.S. has struggled to keep users this year as the frenzy in digital assets cooled. Investors expect the Federal Reserve to further raise interest rates, sapping appetite for assets seen as risky, such as cryptocurrencies and technology stocks.