Coinbase Global, Inc. Q4 FY2025 earnings call

Diversification and Product Launches

• Brian highlighted the successful diversification of the business with stablecoins, subscription and services revenue, and trading of other asset classes like stocks, prediction markets, and commodities, making revenue less correlated to crypto price fluctuations. The Everything Exchange was launched in Q4 with early signs of success, seeing global trading volume and market share double year-over-year. Base set a new transaction all-time high with AI agents adopting stablecoin wallets.

2026 Priorities

• Grow the Everything Exchange: Focus on expanding to more countries, adding more markets and a sports hub for prediction markets, rolling out equities with nearly 10,000 tickers live, and acquiring Echo to enable more efficient onchain capital formation.
• Scale stablecoins in payments: Focus on expanding stablecoin utility with deeper product integrations, scaling payments infrastructure, and ensuring regulated U.S. stablecoins remain competitive.
• Bring the world onchain: Increase DeFi integrations in the Coinbase app, scale adoption of the Base app for trading, and increase transaction volume on the base chain.

2025 Performance Highlights

• Alesia noted 2025 was a strong year operationally and financially, with consistent execution against goals. The company had ninth consecutive quarter of native unit inflows, twelfth consecutive quarter of adjusted EBITDA profitability, and deployed $1.7 billion to repurchase shares, fully offsetting 2025 dilution from stock-based compensation.

In 2025, Coinbase's total revenue was $7.2 billion, a 9% year-over-year increase. Subscription and services revenue reached $2.8 billion, up 23% year-over-year and more than 5.5x higher than the prior cycle peak in 2021. For Q4, total revenue was $1.8 billion, down 5% quarter-over-quarter. Transaction revenue was $983 million, down 6% quarter-over-quarter, while subscription and services revenue was $727 million, down 3% quarter-over-quarter. The company has 12 products with over $100 million of annualized revenue, with half of those over $250 million.

Q1 Outlook

• Subscription and services revenue expected to be in the range of $550 million to $630 million. Technology and development plus general and administrative expenses expected to be flat quarter-over-quarter in the range of $925 million to $975 million. Sales and marketing expenses expected to be flat to down quarter-over-quarter in the range of $215 million to $315 million.
• Coinbase enters 2026 with a diversified revenue base, scaled global platform, and strong balance sheet to invest through the cycle. The company plans to continue buying Bitcoin and repurchasing stock opportunistically.

• Technical Issues: Briefly experienced interruptions in buying, selling, and transferring crypto on retail and prime platform due to a technical issue, but issue was resolved. The company has made investments in platform to mitigate such events but may still have technical bumps.
• Crypto Ecosystem Leverage: Concern about potential customer freezes during quick pullbacks due to leverage in the crypto ecosystem.

Q: Are you making any headway on positive outcomes regarding the CLARITY Act?

A: Yes, Brian is optimistic about getting something through in the next few months, appreciating efforts of Senate and administration, and seeing an opportunity for win-win outcome.

Q: With Base TVL and sequencer revenue growing strongly in late 2025, what percentage of overall subscription and services revenue do you expect Layer 2 activity from Base and partners to contribute in 2026? And are there plans to further incentivize builders there?

A: Alesia noted Base revenue is monetized directly and indirectly; no specific forecast yet. Brian mentioned giving Base grants for builders, improving developer tools, exploring a Base token, and the Base app to drive adoption.

Q: What product or platform initiative are you most excited about that investors may be underestimating today?

A: Brian highlighted the Everything Exchange as a big vision for all tradable assets onchain and stablecoin payments as still in early days with significant growth potential.

Q: Please discuss line of sight to Everything Exchange monetization. What are your thoughts on the timing about revenue diversification?

A: Alesia mentioned derivatives as a big growth driver, with early signals from prediction markets and equities, and will share more updates in Q1; focus on driving assets on platform and native units to drive monetization.

Q: Could your economic relationship with Circle change depending upon language in a market structure bill? In particular, could passage of a bill such as CLARITY that eliminates promotional payments to stablecoin holders directly eliminate or directly curtail Coinbase's participation in Circle reserve fee income?

A: Brian said no, market structure legislation wouldn't change economic relationship with Circle, and they want regulated stablecoins to remain competitive with rewards.

Q: The valuation of the whole sector, including tokens and equities has come down. How does Coinbase think about the opportunities in larger-scale buybacks and M&A?

A: Alesia said Coinbase is in strong financial position with over $11 billion in cash, deployed $1.7 billion to repurchase shares, completed 10 acquisitions in 2025, and will continue buying Bitcoin, repurchasing, and looking at M&A.

Q: What have you seen in terms of prediction market adoption to date among Coinbase customers? Do you have plans to build your own prediction market venue? Or are you comfortable continuing to act as a retail distribution for existing venues?

A: Brian said prediction markets rolled out to 100% of customers recently, early interest is great, with improvements ongoing; keeping options open on building own markets.

Q: Do you think we're heading into another crypto winter? How long until the cycle could begin to recover? And how should investors think about the KPIs suggesting that the cycle could begin to turn?

A: Brian said they focus on building products, markets are psychological, seeing traders on platform as net buyers, but leaves investment decisions to others.

Q: Can you talk about your 2026 spending plans? Given a wide variety of potential top line outcomes in 2026, how do you think about need to spend versus want to spend? And where is there most flex in the cost base? Is it marketing, venture moonshot type investments, et cetera?

A: Alesia said 2025 was investment year with sales and marketing, USDC rewards, and M&A as drivers; Q1 expense outlook is flat to Q4, focusing on nimble spending.

Q: Yesterday, a Wall Street Journal article said that BlockFill was suspending customer withdrawals. And today, Coinbase has reportedly had issues with customers trying to buy, sell and transfer. Was the Coinbase issue just a tech mishap and not a more severe issue? Does the amount of leverage in the crypto ecosystem increase the risk that we may be more prone to customer freezes during quick pullbacks?

A: Alesia said it was a technical issue, unrelated to volume or market conditions, now resolved; company has invested in platform to mitigate such events but may have technical bumps.

Q: As you work to scale the Everything Exchange, can you describe the strategy for bringing customer assets to Coinbase? To what extent do you believe -- do you expect equities and prediction markets to act as a front door to net new users?

A: Brian discussed the asset accumulation flywheel strategy, starting with being trusted brand, storing more crypto, connecting more products to assets, with equities and prediction markets attracting traditional investors.

Q: You guys have made some key acquisitions in 2025. Can you help us think through your M&A strategy at this point? What parts of the business are you looking to bolster with M&A? And what types of assets are you looking at?

A: Emilie said 2025 was great for M&A, 10 acquisitions/acqui-hires, and in 2026, selective but aggressive in advancing Everything Exchange, owning onchain infrastructure, and bundling stablecoins and payments infrastructure.

Q: There's a recent debate that the original version of L2s as branded shards for scaling is no longer entirely valid as Ethereum L1 is improving its own capacity and L2 decentralization has been slower than expected. The debate further argues that L2s should focus on value-added features, including AI, privacy, et cetera. What's Coinbase's view on the Base L2 value prop going forward in this respect? And how might potential DeFi regulations shape Base's future?

A: Brian said Base is #1 L2 on Ethereum, great for payments, trading, DeFi, with scale and speed; working on privacy features, and DeFi regulations could shape future but Base has broad utility.

Q: Stablecoin adoption is a 2026 priority, but we've seen market cap flatline for the last couple of months. Why has that been? And what gives you confidence around growth in 2026? And can you give any color around incremental adoption trends?

A: Alesia said risk appetite range bound and higher velocity of stablecoin payments; confidence from GENIUS Act passing, embedding stablecoins in products, and USDC market cap growth. Brian added GENIUS Act led to 150 companies announcing stablecoin integrations, and rewards important for competitive U.S. regulated stablecoins.

Q: Can you provide an update on how much USDC market cap is currently on the Coinbase platform, i.e., a January average or February number?

A: Alesia said they don't provide January, February data on USDC balances, point to Shareholder Letter for end of year balance and revenue details.

Q: Can you quantify the effective take rate compression from simple to advanced and Coinbase One users? Structurally, where do you see normalized consumer take rates settling over the next 2 to 3 years?

A: Alesia said mix shift with more volume to advanced product and Coinbase One users, focused on growing Coinbase One membership, but no view on when take rates will compress.

Q: Adoption on commerce and developer rails, you talked about on Page 19 of the Shareholder Letter. How do you work with Circle and USDC on real-world volume commercialization? Can you give us an update on the time you expect it takes to get up the S-curve in B2B payments? How is this different from potential revenue S-curve? Contrast that with USDC on base for more consumer-centric volumes via x402.

A: Alesia said they work on own products for USDC payments, partner with Circle, early in product journey, working on go-to-market for B2B payments.

Q: How should we think about the strength of the casual crypto trader in this winter? Any pattern you can call out for when they come back eventually?

A: Alesia said majority of retail consumers HODL through price declines, active in high volatility periods, seeing net buy versus sell in Q1, but markets move to risk off; focus on diversification.