Coinbase shares fell to their lowest level in about two and a half years after the cryptocurrency platform reported a second-quarter net loss of $359.5 million and revenue of $1.22 billion, results that came in below Wall Street expectations. The stock later recovered some ground to trade near $150, but remained down about 57% over the past 12 months.
The earnings release intensified scrutiny of whether Coinbase’s expanding product lineup can cushion the company against weak cryptocurrency trading volumes. Transaction fees remain sensitive to market activity, while newer ventures such as prediction markets, tokenized equities and perpetual futures have yet to make a substantial contribution to profit, according to analysts at JPMorgan.
JPMorgan reduced its December 2026 price target for Coinbase to $148 from $196 while maintaining an Overweight rating. The bank said softer trading activity weighed on both transaction revenue and the company’s subscription and services segment, showing that Coinbase’s newer sources of income are not yet fully insulated from conditions in crypto markets.
Coinbase said subscription and services revenue reached $555 million during the quarter, representing 48% of total net revenue. That segment includes income tied to stablecoins, custody, blockchain rewards and other services designed to produce more recurring revenue than retail trading commissions.
The figure shows how far Coinbase has moved from its earlier reliance on spot trading, but analysts remain divided over how dependable that revenue mix has become during periods of weaker market participation.
Analysts question the pace of diversification
The main disagreement on Wall Street is not whether Coinbase has broadened its business. It has. The question is whether the newer products are scaling fast enough to offset a downturn in its core trading operation.
JPMorgan said emerging business lines, including prediction markets and tokenized equities, have not yet produced meaningful earnings support. The bank’s assessment places near-term emphasis on execution rather than product announcements, particularly as trading conditions remain subdued across the digital-asset market.
Alesia Haas, Coinbase’s chief financial officer, said broad spot-market volumes across the sector declined by more than 20%. Lower market volumes generally reduce the number of transactions routed through exchanges and can pressure fee revenue even when cryptocurrency prices remain volatile.
Brian Armstrong, Coinbase’s co-founder and chief executive officer, said Bitcoin trading accounted for 12% of the company’s total revenue. The figure points to a more diverse revenue base than the company had in earlier market cycles, when Bitcoin activity and retail trading were much more central to its results.
Yet diversification has not eliminated the impact of lower market activity. JPMorgan said pressure was visible across several business lines, including subscription and services revenue, a segment that investors have often viewed as a potential stabilizer when trading volumes retreat.
Mizuho reached a similar conclusion, lowering its price target to $155 from $200 while keeping a Neutral rating. The firm said Coinbase’s subscription and services business had not yet reached the scale or predictability needed to materially reduce the company’s reliance on crypto trading.
That judgment carries particular weight after a quarter in which subscription and services represented nearly half of Coinbase’s revenue. A large share of revenue does not automatically mean a business line is stable: income linked to stablecoin balances, staking activity and other crypto-native services can also change with market prices, on-chain activity and user demand.
Prediction markets bring revenue, but remain small
Coinbase disclosed that its prediction-markets business generated $100 million in annualized revenue after doubling during the quarter. The business allows users to trade contracts tied to the outcomes of real-world events, a category that has drawn increased attention across financial and crypto platforms.
Bernstein, which retained an Outperform rating and a $330 price target, said it was watching Coinbase’s execution in such newer lines closely. Its $330 target was the highest among the analyst notes reviewed.
The firm said Coinbase is building a wider platform that spans stablecoins, payments, tokenized real-world assets, prediction markets and perpetual futures. Perpetual futures are derivatives contracts without a fixed expiry date and are widely used in crypto markets, though they also bring added regulatory and risk-management demands.
Bernstein compared Coinbase’s $100 million annualized prediction-market revenue with a rival prediction-markets operation it estimated at roughly $600 million annually. The comparison suggests Coinbase has gained early traction but remains well behind the leading business in a market where liquidity and user activity tend to concentrate on the largest venues.
The gap also explains why analysts are focused on the economics of execution. New products can attract users and expand Coinbase’s addressable market, but their financial impact depends on transaction volumes, take rates, compliance costs and the speed at which the company can build liquid markets.
Market-share gains provide a counterweight
Benchmark offered a more constructive reading of the quarter despite cutting its price target to $230 from $270. The firm pointed to Coinbase’s third consecutive quarter of market-share gains and said the company had continued shifting toward a broader product mix rather than relying predominantly on retail crypto trading.
Market-share gains could help Coinbase emerge from a slow trading environment in a stronger competitive position. If sector volumes recover, a larger portion of activity routed through the platform would support transaction revenue. The immediate challenge is that a larger share of a shrinking market may not produce the revenue growth needed to satisfy analysts’ expectations.
The sharply different price targets — from JPMorgan’s $148 to Bernstein’s $330 — reflect competing assumptions about that transition. Bearish views emphasize the near-term drag from lower volumes and the limited earnings contribution from recent launches. More optimistic assessments give greater weight to Coinbase’s market-share gains, its growing services business and the potential for new trading products to mature.
For now, the quarterly loss and weaker revenue have shifted the debate away from Coinbase’s product roadmap and toward the pace at which those products can deliver durable income. The company has demonstrated that it can generate nearly half of its revenue outside its traditional transaction-fee base; the next earnings reports will show whether that mix can withstand a prolonged period of subdued crypto-market activity.
Curious how tokenized stocks may evolve after Coinbase’s slump? Explore tokenized equities and how they work next.
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