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Coinbase (NASDAQ:COIN) is expected to post softer results in Q2 vs. Q1 as cryptocurrency trading volumes on its platform weakened sequentially in the face of lower token prices, Raymond James warned on Tuesday.
Y/Y comps still may be in Coinbase’s (COIN) favor, though. “While softer from a robust start to the year, near-term momentum remains mostly elevated vs. the year-ago period with higher valuations in the crypto industry and higher trading volumes at Coinbase,” analyst Patrick O’Shaughnessy wrote in a note.
He estimated that average daily volumes totaled $2.36B in Q2, down 31% from the previous quarter and trailing the $2.93B consensus. “ADV tailed off each sequential month in the quarter, with peak volumes in April.”
Overall, Wall Street expects COIN to record GAAP EPS of $0.98 when the company reports its Q2 results on Aug. 1, 2024. That’s well below $4.40 in Q1 and higher than -$0.42 in Q2 2023. Revenue is expected to be $1.40B vs. $1.64B in Q1 and $707.9M in Q2 2023.
After a robust start to the year that saw the persistent inflows into spot bitcoin (BTC-USD) exchange-traded funds driving up crypto prices, the environment cooled in Q2. Bitcoin slid 13% Q/Q, while ether (ETH-USD) slipped 4%; though both remain sharply higher Y/Y.
“This suggests that pricing dynamics should be a modest headwind to assets on platform during the quarter,” O’Shaughnessy wrote.
He also pointed out that Coinbase’s (COIN) market share of 41.2% in Q2 fell from 44.6% in Q1 but rose from 38.6% in Q2 2023.
