Coinbase’s Profit Streak Ends as Crypto Market Corrects

After eight consecutive quarters of profitability, Coinbase faced a sharp setback at the end of 2025. The largest U.S. crypto exchange slid into the red, missing Wall Street revenue expectations, even as trading activity reached fresh annual highs. A hefty round of impairments tied to Coinbase?s own crypto holdings weighed on the balance sheet and pressured results.

Red numbers driven by a crypto correction

Coinbase reported a Q4 2025 net loss of $667 million, a stark contrast to a $1.3 billion net income in the same quarter a year earlier. Management attributed the drop largely to unrealized losses in the firm?s investment portfolio, totaling about $718 million.

Revenue also felt the headwinds. Revenue for the quarter came in at $1.78 billion, roughly 20% lower than the prior-year period and short of the consensus estimate of $1.83 billion. Transaction revenues, a key driver of profitability, declined 6% quarter-over-quarter to $983 million. The broader market correction contributed to a nearly 50% retreat in Bitcoin from its October 2025 peak, helping explain the pressure on trading income.

Operational momentum remains intact

On an annual basis, Coinbase showed strong operating activity despite the quarterly setback. For full-year 2025, the company processed $5.2 trillion in trading volume, up 156% from 2024. This expansion helped Coinbase double its global market share to 6.4%.

The subscriptions and services segment also posted a full-year high, delivering $2.8 billion in revenue, up 23% year over year. Nonetheless, this area cooled in Q4, recording a 3% sequential decline.

Outlook, guidance and buyback news

For the current first quarter of 2026, Coinbase tempered expectations. They expect subscriptions and services revenue of $550 million to $630 million, a figure that sits well below analyst estimates of around $747 million. By February 10, transaction revenues stood at about $420 million.

In an effort to support the stock price, the board approved a new share repurchase program valued at $2 billion. This follows previous buybacks totaling $1.7 billion completed by early February. Separately, it emerged that Chief Executive Officer Brian Armstrong had sold more than $500 million worth of Coinbase shares over the past nine months.

Solid balance sheet but shares under scrutiny

Coinbase ended the year with a cash cushion of $11.3 billion, leaving the balance sheet comparatively solid. Nevertheless, the stock has fallen roughly 37% since the start of the year and remains under close watch. The success of the new buyback program and a return to profitability will hinge on whether crypto-asset prices stabilize in the coming months.