Coinbase(US:COIN)2025-07-31 20:16Financial Performance - For Q2 2025, the company's net revenue was $1.4 billion, with transaction revenue of $764.3 million and subscription and services revenue of $655.8 million, compared to $1.4 billion, $780.9 million, and $599.0 million in Q2 2024, respectively [139]. - The company's net income for Q2 2025 was $1.4 billion, significantly up from $36.2 million in Q2 2024, while Adjusted EBITDA was $512.1 million, down 14% from $595.6 million in the same quarter of 2024 [140]. - For the three months ended June 30, 2025, total revenue increased to $1,497,208, a 3.3% rise from $1,449,628 in 2024, while for the six months, it rose to $3,531,503, up 14.4% from $3,087,198 in 2024 [153]. - Net income for the three months ended June 30, 2025, was $1,428,900, a significant increase from $36,150 in 2024, and for the six months, it rose to $1,494,508 from $1,212,395 in 2024 [153]. - Adjusted EBITDA for the three months ended June 30, 2025, was $512,065 thousand, compared to $595,552 thousand in the same period of 2024, reflecting a decrease of $83,487 thousand [185]. User Metrics - Monthly Transacting Users (MTUs) increased to 8.7 million in Q2 2025, up 6% from 8.2 million in Q2 2024, and 9.2 million for the first half of 2025, a 14% increase from 8.1 million in the same period of 2024 [142]. Trading Volume - Trading Volume for Q2 2025 was $237 billion, a 5% increase from $226 billion in Q2 2024, with consumer trading volume rising by 16% and institutional trading volume increasing by 3% [151]. - Trading Volume growth for the three months ended June 30, 2025, was lower than the 12% growth in the overall U.S. spot market trading volume, while for the six months, it outpaced the 15% growth in the overall U.S. spot market [154]. - Trading Volume by asset showed Bitcoin's share decreased to 30% in Q2 2025 from 35% in Q2 2024, while the share of other crypto assets increased by 38% [151]. Revenue Breakdown - Transaction revenue for the three months ended June 30, 2025, was $764,270, a decrease of 2.1% from $780,902 in 2024, while for the six months, it increased by 9.1% to $2,026,478 from $1,857,643 in 2024 [156]. - Subscription and services revenue increased to $655,826 for the three months ended June 30, 2025, up 9% from $599,040 in 2024, and for the six months, it rose to $1,353,937, a 22% increase from $1,109,976 in 2024 [159]. - Stablecoin revenue for the three months ended June 30, 2025, was $332,497, a 38% increase from $240,436 in 2024, and for the six months, it rose to $630,032, up 44% from $437,753 in 2024 [159]. - The percentage of transaction revenue from Bitcoin increased to 34% for the three months ended June 30, 2025, compared to 31% in 2024, while Ethereum's share decreased to 12% from 17% [157]. Expenses - Total transaction expenses increased by 28% to $245.3 million for the three months ended June 30, 2025, compared to $191.5 million in 2024 [162]. - Technology and development expenses rose by 6% to $387.3 million for the three months ended June 30, 2025, from $364.3 million in 2024 [163]. - Sales and marketing expenses surged by 43% to $236.2 million for the three months ended June 30, 2025, compared to $165.3 million in 2024 [167]. - General and administrative expenses increased by 10% to $353.7 million for the three months ended June 30, 2025, from $320.1 million in 2024 [168]. - Other operating expenses increased to $308.0 million for the three months ended June 30, 2025, from $34.4 million in 2024, primarily due to losses associated with a data theft incident [173]. Cash and Assets - The company's cash and cash equivalents totaled $7,539,388 thousand as of June 30, 2025, down from $8,543,903 thousand at the end of 2024 [188]. - The total USDC holdings increased to $2,153,824 thousand as of June 30, 2025, compared to $1,241,808 thousand at the end of 2024, with $1,783,627 thousand not loaned or pledged as collateral [188]. - Long-term debt as of June 30, 2025, was $4.3 billion, with $1.3 billion classified as a current liability due within the next 12 months [191]. - As of June 30, 2025, the company held $126.0 million in crypto assets for operations, $951.3 million as collateral, $223.6 million borrowed, and $1.8 billion for investment [194]. Strategic Initiatives - The company secured its Markets in Crypto-Assets Regulation (MiCA) license, marking a significant milestone in advancing crypto policy and regulation [138]. - The growth in USDC AOP was attributed to the USDC rewards program and deeper integration across products, with USDC AOP increasing by 56% year-over-year [148]. - The company plans to dynamically adjust its expense base in response to market conditions and revenue opportunities, particularly concerning variable expenses [141]. - The company does not plan to engage in regular trading of crypto assets but may purchase additional assets for a buy and hold strategy [193]. Tax and Regulatory Compliance - The provision for income taxes for the three months ended June 30, 2025, was $394,873 thousand, an increase of $491,260 thousand compared to a benefit of $96,387 thousand in 2024, reflecting higher pretax income [178]. - The company complied with regulatory capital requirements of approximately $1.3 billion as of June 30, 2025, met by a combination of corporate cash and certain crypto assets [199]. - The company does not expect the One Big Beautiful Bill Act to have a material impact on its effective tax rate and net deferred tax asset balance in 2025 [179].