Coinbase Posts $719M Q3 Net Income, but Adjusted Profit Is $78M
Coinbase swung to a $719 million Q3 profit, ending a two-quarter losing streak, but about $715 million came from gains on its crypto holdings. Adjusted net income was $78 million, revenue was flat at $1.22 billion, and prediction markets topped $200 million in annualized revenue.
Coinbase swung to a $719 million net profit in the third quarter, or $2.51 per diluted share. About $715 million of that came from gains on crypto the company holds as an investment. Strip those out, along with $39 million in other investment gains and related tax adjustments, and adjusted net income was $78 million. The exchange reported on Thursday, Oct. 29, ending a two-quarter losing streak.
Consensus had pointed to a loss. Analysts expected a 15-cent loss per share, according to Zacks. The prior two quarters were a $394 million loss in Q1 and a $359.5 million net loss in Q2. A year ago, Q3 2025 delivered a $432.6 million profit.
Revenue flat, trading beats
Revenue came in at $1.22 billion, in line with estimates, flat from Q2 and down 35% from a year earlier. Transaction revenue slipped 1% to $590 million but beat the roughly $527 million expected, even as crypto volatility sank to multiyear lows.
Adjusted EBITDA hit $333 million, up 60% from about $208 million in Q2. Fifteenth straight quarter in the green on that measure.
Costs are coming down too. Coinbase cut 2026 adjusted expense guidance by another $100 million at the midpoint, to $4.15-$4.3 billion. Q4 transaction revenue through Oct. 25 was about $165 million.
Stablecoins and prediction markets carry the mix
Subscription and services revenue rose 3% to $570 million, nearly half of net revenue. Stablecoins contributed $307 million of that. Average USDC held in Coinbase products reached a record $22 billion, up 49% year over year and about 30% of USDC average market cap. The company listed Ripple's RLUSD across Prime, Exchange and the retail app a day before the results.
Prediction markets topped $200 million in annualized revenue. Daily traders grew more than 60% from Q2, and revenue has compounded 82% per quarter since launch. CFO Alesia Haas framed the appeal in terms of volatility:
"Prediction markets are adding another revenue stream and are less correlated to crypto volatility."
Alesia Haas, CFO, Coinbase
CEO Brian Armstrong said the business is "growing even through slower sports months."
Coinbase's earnings release also highlighted record Coinbase One paid subscribers, up 24% year over year. Those users generate 3.5x more average revenue per user.
Market share up, stock still deep below highs
Coinbase's share of crypto trading volume rose to 10.7% from 10.3% in Q2 and 9.1% in Q1, the fourth straight quarterly gain. Derivatives volume has grown at a 179% compound annual rate over two years.
COIN closed at $160.59, down about 1.1%, before the results and was little changed after hours. The shares sit more than 55% below their 52-week high of $361.40.
The read-through: the $719 million headline is a mark-to-market story, not an operating one. The cleaner signals are the $78 million adjusted profit, the 60% jump in adjusted EBITDA and the lower cost guide. Revenue is still 35% below last year. Stablecoin and prediction market income has to carry the load while trading volume stays subdued.
