Coinbase Q2 Revenue Falls 26% from Q1 Amid Retail Slowdown

Coinbase reported $1.5 billion in revenue for the second quarter of 2025, marking a 3.3% year-over-year increase but a sharp 26% decline from Q1. The dip was largely driven by reduced retail trading activity and broader market softness, according to the company’s July 31 shareholder letter and earnings call.

Earnings per share came in at just $0.12, far below analyst expectations of $1.19. Adjusted EBITDA also declined 13% year-over-year to $512 million.

Retail Trading Slows While Institutional Volume Holds Up

Retail trading volume dropped to $43 billion, well short of forecasts and a significant retreat from the prior quarter’s momentum. Institutional trading, however, remained resilient at $194 billion, slightly above expectations and accounting for over 80% of total trading volume.

Total trading volume for the quarter reached $237 billion. Market participants pointed to declining crypto price volatility and macroeconomic distractions, such as U.S. trade policies and geopolitical tensions for the reduced investor activity.

“Crypto markets were softer in Q2 compared to Q1… markets are not linear,” said Anil Gupta, Vice President of Investor Relations at Coinbase. “Lower volatility and headlines outside crypto were headwinds.”

Stablecoin and Subscription Revenue Buoy Growth

Despite trading headwinds, Coinbase’s subscriptions and services segment delivered $655.8 million in revenue—a 9% increase year-over-year. The growth was fueled by its stablecoin revenue, which rose 12% from Q1 to $332 million.

Coinbase benefits from a revenue-sharing arrangement with Circle, issuer of the USD Coin (USDC). The exchange keeps 100% of the revenue generated from USDC held on-platform and earns about 50% of the revenue from USDC activity elsewhere.

The appreciation of Coinbase’s stake in Circle and gains from crypto holdings also contributed to $1.4 billion in net income, up sharply from $66 million in the previous quarter.

Stock Dips Post-Earnings, But 2025 Gains Remain Strong

Following the earnings release, Coinbase shares dropped more than 6% in after-hours trading to around $353. Still, COIN remains up over 45% year-to-date and has outperformed the S&P 500 since joining the index in May. The stock hit an all-time high near $420 in July.

Bitcoin, which accounts for a significant share of Coinbase trading volume, rose 26% in Q2 and briefly surpassed $107,000 in late June. It climbed as high as $122,850 in July before retreating slightly.

Looking Ahead: Coinbase Plans ‘Everything Exchange’ Rollout

Despite current challenges, Coinbase remains focused on long-term expansion. The company has revealed plans to launch an “everything exchange” that will start in the U.S. before expanding globally. This platform will offer tokenized real-world assets, derivatives, prediction markets, and early-stage token sales.

The move builds on Coinbase’s aggressive M&A strategy. In May, it acquired Deribit—an options platform that controls 80% of the crypto derivatives market for nearly $3 billion. The deal is considered the largest acquisition in crypto history. Coinbase has now acquired six companies in 2025 alone.

According to CNBC, the new platform aims to serve both institutional and retail users, blending tokenized equity offerings with contracts tied to real-world event outcomes.

Favorable Regulatory Climate Fuels Strategic Optimism

Coinbase and other crypto firms are benefiting from a more supportive U.S. regulatory environment under President Donald Trump’s administration. Recent legislation such as the GENIUS Act and the CLARITY Act have given digital asset firms more certainty around compliance and product development.

M&A activity across the industry has surged, with 61 deals announced in Q1 2025 alone, according to Architect Partners. Coinbase appears poised to continue leading that trend.

Coinbase Earnings Through The Years

Quarter	Revenue (USD millions)
2020 Q1	191
2020 Q2	186
2020 Q3	315
2020 Q4	585
2021 Q1	1,801
2021 Q2	2,228
2021 Q3	1,312
2021 Q4	2,498
2022 Q1	1,166
2022 Q2	808
2022 Q3	590
2022 Q4	629
2023 Q1	773
2023 Q2	708
2023 Q3	674
2023 Q4	954
2024 Q1	1,638
2024 Q2	1,450
2024 Q3	1,205
2024 Q4	2,272
2025 Q1	2,034
2025 Q2	1,500