Coinbase’s long-awaited Q1 2025 Earnings Report came out today, disappointing bullish expectations in several key areas. Nonetheless, user activity is still strong, with gross USDC balance increasing 49% QoQ.

Despite a positive day beforehand, the company’s stock valuation also fell over 3% in after-hours trading.

Coinbase’s Bearish Earnings Report

Coinbase, one of the world’s largest crypto exchanges, can point to a few growth trends to be optimistic about. For example, the SEC dropped its case against the firm, and it acquired the world’s largest crypto derivatives exchange.

The industry had bullish expectations for Coinbase’s Q1 2025 Earnings Report, but the actual results disappointed.

Overall, Coinbase’s Q1 revenue was almost $200 million short of the expected $2.2 billion, and its transaction revenue was $70 million under the anticipated amount.

Earnings per Share were a meagre $0.24 instead of $2.09, and subscription and services revenue also underperformed by $4.5 million.

Coinbase already displayed a few bearish signals before today’s Earnings Report. For example, scams have been targeting its users, leading to massive thefts.

The exchange’s stock price also fell 30% in Q1, its worst performance since the FTX collapse. Earlier today, its stock traded well on bullish report expectations but dropped substantially after hours.

Despite this outwardly bearish report, Coinbase still highlighted a few positives. Trading volume did overperform expectations, albeit slightly; the exchange reported $393 billion instead of the anticipated $392.7 billion.

Additionally, the firm’s long-running stake in Circle is paying off, with gross USDC balances in Coinbase products increasing to $12.3 billion. This represents an impressive 49% gain quarter-over-quarter (QoQ).

Between these factors, the Deribit acquisition and regulatory breakthroughs, Coinbase maintains its optimism:

“Looking ahead, we’re focused on expanding real-world crypto utility, strengthening and extending our trading platform, and scaling the infrastructure that will power the financial system of the future. With growing regulatory clarity, we’re accelerating our vision towards economic freedom,” the company claimed.

Ultimately, it’s difficult to predict where the firm is heading from here. Although this Earnings Report underperformed expectations, Coinbase still has a lot of resources at its disposal.

Furthermore, Q1 showed positive developments for the exchange in terms of market expansion. Coinbase achieved regulatory licenses in both Argentina and India, further expanding its user base across the globe.