Coinbase reported a sharp rebound in its third-quarter performance, signaling renewed strength across its trading and service lines. The U.S. crypto exchange posted $1.9 billion in total revenue, up 37% from the prior quarter. Growth in ether trading, subscription income, and service fees helped lift results after a subdued spring. The gains offset a small decline in bitcoin’s trading share.
Several Wall Street firms reacted positively, describing Coinbase as more balanced and mature than in previous cycles. Analysts said the company’s broader ecosystem of derivatives, stablecoins, and its Base network strengthened overall performance. They also warned that rising operating expenses could weigh on profit margins in the coming quarters.
Analysts Highlight Coinbase’s Profit Strength and Expanding Ecosystem
William Blair analysts, led by Andrew Jeffrey, reaffirmed an “Outperform” rating. Jeffrey said Coinbase is building the most secure and efficient crypto platform. He noted profit margins near 45% and predicted steady growth from stablecoin and derivatives businesses. The firm expects these segments to reduce volatility in revenue over time.
Jeffrey added that margins could eventually reach the high-60% range. He said growth would not be linear but pointed to trading volume, derivatives, stablecoin commerce, and DeFi as future drivers. The team believes Coinbase deserves to trade at a premium to fintech peers due to its position in a $4 trillion crypto ecosystem.
JPMorgan also praised the results, calling the quarter a commanding beat. The firm said Coinbase earned $1.44 per share and achieved $801 million in EBITDA, both above expectations. Analyst Kenneth Worthington said Coinbase’s progress in building an on-chain ecosystem was clear through both organic growth and acquisitions.
Worthington highlighted Deribit’s 73% profit margin as a positive sign for future integration. However, JPMorgan reduced its price target slightly to $399 from $404. The bank warned that operating costs may climb about 12% in the next quarter as Coinbase absorbs new hires and acquisition expenses.
Analysts stated that Coinbase’s next product event on December 17 could act as a major catalyst. They expect potential announcements on tokenized equities, prediction markets, or a new Base token launch. JPMorgan said Coinbase’s $11 billion cash reserve gives it a strong advantage in competing for acquisitions within the crypto industry.
Coinbase Expands Beyond Trading with Strong Strategic Momentum
Benchmark reaffirmed its positive outlook on Coinbase, setting a price target of $421. The firm noted that Coinbase’s “Everything Exchange” approach continues to gain traction. Revenue from stablecoin activity climbed 7% to $355 million, while income from staking, custody, and related services surpassed previous forecasts.
Palmer said the integration of USDC adds stability by blending fee-based and yield-based income. He noted Coinbase’s purchase of 2,772 bitcoin and the expansion of its $2 billion share repurchase program as signs of management confidence. These moves, he said, support the company’s efforts to diversify beyond spot trading.
Bernstein analysts kept their “Outperform” rating and a $510 target. Analyst Gautam Chhugani described Coinbase’s quarter as solid, though slightly below his forecast. He said the company is building long-term infrastructure similar to what Amazon created in cloud computing.
Chhugani expects the Base app to merge trading, payments, and social features, creating new revenue streams. He said trading revenue could rise about ten percent in the fourth quarter. Bernstein also pointed to the upcoming Coinbase System Update and the U.S. Clarity Act as potential drivers of regulatory stability for the crypto sector.
Coinbase’s Q3 results show progress toward becoming a full-scale financial platform. Its expansion across derivatives, stablecoins, and services reflects a maturing strategy. While costs are set to rise, analysts agree that strong liquidity and a diversified business model give Coinbase an advantage in the evolving digital asset market.