Key Takeaways
- Coinbase shares surged in after-hours trading following the release of fourth-quarter earnings that exceeded Wall Street estimates.
- The approval of spot Bitcoin ETFs and positive macroeconomic outlook for 2024 contributed to the growth in quarterly transaction revenue.
- Technical analysis suggests potential resistance for Coinbase shares around $210.
Coinbase Reports Strong Q4 Earnings
Coinbase (COIN) experienced a significant surge of over 14% in extended-hours trading on Thursday after reporting impressive quarterly earnings and revenue that surpassed expectations. The largest U.S. cryptocurrency exchange posted adjusted earnings of $1.04 per share for the fourth quarter, a substantial improvement from the loss of $2.46 per share in the same period the previous year.
Revenue Growth and Outlook
The company’s total revenue of nearly $954 million marked a 41% increase from the previous quarter and exceeded the consensus estimate of $826 million. The growth was primarily driven by a 64% increase in transaction revenue compared to the previous year, fueled by the excitement surrounding spot Bitcoin ETF approvals and positive expectations for the macroeconomic landscape in 2024.
Looking ahead, Coinbase anticipates first-quarter subscription and services revenue to range between $410 million and $480 million, surpassing the Street’s estimate of $356.22 million.
Market Share and Trading Volumes
Despite concerns about market share erosion due to heightened competition in the crypto trading sector, Coinbase reassured investors about its performance. The company reported trading volumes of $154 billion in the fourth quarter, significantly higher than analysts’ projections of $142.7 billion.
Technical Analysis and Stock Performance
Following a bottom in late December 2022, COIN shares have been trading within an ascending channel, indicating key support and resistance levels. Recent price action near the 50-day moving average suggests growing bullish momentum. Investors should monitor the upper trendline of the channel, currently positioned at $210, as a potential profit-taking area.
After the earnings announcement, Coinbase shares climbed 14.3% to $189.29 in extended trading on Thursday.
The information provided in this article is for informational purposes only.
