Coinbase shares dropped sharply on Tuesday after the company reported weak results that underscored the crypto market slump.
The stock tumbled 12% in regular trading, and shed another 12% after-hours after the company reported a loss of $1.98 a share on revenue of $1.17 billion. The company was expected to post a profit of 17 cents a share on revenue of $1.48 billion.
The first quarter “continued a trend of both lower crypto asset prices and volatility that began in late 2021,” Coinbase said in a letter to shareholders.
Coinbase said its monthly transacting users totaled 9.2 million in the first quarter, down 2.2 million or 19% from the fourth quarter. The company said it expects monthly users to again fall sequentially in the current quarter.
CEO Brian Armstrong last quarter had downplayed worries that the crypto market was in a new prolonged slump, what's sometimes referred to as crypto winter. But the crypto downturn appears to have worsened amid the broader market downturn.
Coinbase said the crypto slump was highlighted in April when it saw “continued declines in both crypto asset volatility and crypto asset prices, which we believe are associated with weakness in financial markets.”
Including Tuesday's after-hours decline, the company's value has fallen nearly 80% since its shares peaked shortly after its April 2021 direct listing. Robinhood, another company with significant crypto trading revenue, has fallen a similar amount since its shares peaked in August.
The price of bitcoin has fallen by more than half since November and briefly dipped below $30,000 this week. Crypto asset prices and trading volume are typically linked, Coinbase has noted.