Here's Why Sales & Marketing Spend is Pivotal for Coinbase

Group 1: Company Performance - Coinbase Global's sales and marketing (S&M) expenditure increased by 97% year over year to $654 million in 2024, significantly enhancing brand credibility, user acquisition, and customer engagement [1][7] - Monthly transacting users (MTUs) rose by 14% to 8.4 million, while assets on the platform more than doubled to $404 billion, and trading volume surged by 148% to $1.16 trillion [1][7] - In Q1 2025, S&M expenses reached $247 million, more than double year over year, contributing to a 17% increase in transaction revenues [2][7] Group 2: Strategic Insights - The close alignment between S&M spending and user activity indicates a strong return on investment, with stablecoin-based rewards boosting subscription and services revenues [2][3] - Management estimates S&M spending to be between $215 million and $315 million in Q2 2025, reinforcing a value-accretive growth strategy [2][7] - Historical data suggests that every incremental marketing dollar has driven meaningful growth in volume and recurring income, supporting long-term shareholder returns [3] Group 3: Competitive Landscape - Marketing expenses are crucial for Robinhood Markets, which saw a 57% year-over-year increase in marketing expenses in Q1 2025, constituting 26.4% of total revenues [4] - Block Inc. also relies on S&M spending for growth, with a 13.6% year-over-year increase in Q1 2025, making up 8.7% of total revenues [5] Group 4: Stock Performance and Estimates - COIN shares have gained 37.3% year to date, outperforming the industry [6] - The Zacks Consensus Estimate for COIN's EPS for Q2 and Q3 2025 has increased by 10.3% and 7.1%, respectively, with full-year estimates for 2025 and 2026 rising by 22.8% and 2.7% [9][10]