Coinbase Q3 Earnings: Fivefold Net Income Jump Powered by Diversification Beyond Transaction

TradingKey - Coinbase (COIN), the largest U.S.-regulated cryptocurrency exchange, reported its Q3 2025 earnings on Thursday, October 30. Beyond rising crypto prices driving higher trading volumes, Coinbase’s results showcased its strategic vision and growing revenue diversification — including a major boost from its acquisition of Deribit, the world’s leading crypto options exchange.

Strong Financial Performance

• Revenue: $1.869 billion, up 55% YoY — exceeding the $1.8B consensus
• Net Income: $432.6 million, nearly five times Q3 2024’s $75.5M
• EPS: $1.50, well above the expected $1.10

By business segment:

• Transaction Revenue: $1.046 billion, up 37% QoQ
• Subscription & Services Revenue: $747 million, up 14% QoQ

Diversified Revenue Mix Strengthens Outlook

While trading remains the core revenue driver, transaction income was lower than in Q4 2024 and Q1 2025.

In contrast, subscription and services revenue — now accounting for 39.96% of total revenue — hit its highest level in at least four quarters. This segment is largely driven by stablecoin-related income, including network fees, staking rewards, and custody services.

This shift reflects Coinbase’s success in diversifying revenue streams, making its financial outlook more resilient to market volatility, which heavily impacts trading income.

Coinbase expects subscription and services revenue in Q4 to reach $710–790 million, surpassing analyst expectations of $766.6 million.

Trading Momentum Remains Strong

Despite market fluctuations, Coinbase continues to gain traction with both retail and institutional investors:

• Retail trading volume: Up 37% QoQ, driving 30% growth in related transaction revenue
• Institutional trading volume: Up 22% QoQ, fueling a 122% surge in institutional transaction revenue

A key contributor during the quarter was the acquisition of Deribit, completed earlier this year. In just 47 days post-acquisition, Deribit contributed $52 million in revenue — significantly boosting overall performance.

Coinbase said it remains open to further acquisitions, particularly in the trading and payments sectors.

Vision: The “Everything App”

CEO Brian Armstrong announced that the company will share more details in mid-December about upcoming initiatives, including:

• Tokenized stocks
• Prediction markets

The goal: transform Coinbase into an “Everything App” — a single platform where users can trade, invest, borrow, earn yield, and access new financial products built on blockchain.

Stock Performance and Analyst Outlook

Year-to-date, Coinbase shares are up over 32%, though down about 14% over the past month due to recent crypto market volatility.

On Friday, ahead of U.S. markets, shares rose ~4% in after-hours trading.

According to TradingKey’s stock analysis tool, Wall Street analysts set an average price target of $390.90 — implying about 19% upside from current levels.