Coinbase (COIN) is set to report third-quarter earnings Thursday after a market close, and Wall Street is largely expecting an earnings beat.
According to FactSet, analysts estimate the crypto exchange will post earnings per share (EPS) of $1.14 – quadruple the $0.28 from Q3 last year – and revenue of $1.8 billion, up from $1.2 billion in the same period in 2024.
But the optimism is far from uniform. Analysts at JP Morgan, Barclays and Compass Point agree strongly on blockchain rewards, USDC yields and trading activity, but are divided on what profitability means and how much future coinbase value will be unlocked from the layer-2 blockchain, base.
JP Morgan’s Kenneth Worthington is the most bullish of the group, upgrading Coinbase to “overweight” and setting a $404 price target for December 2026. If launched, Worthington believes the token could command a $12 billion to $34 billion market cap, with Coinbase retaining 40%, potentially adding $14 to $42 per share in equity value.
He also sees upside from Coinbase’s efforts to segment USDC customers through its subscription product, Coinbase One. By limiting StableCoin’s yield rewards to paying members, Worthington estimated Coinbase could add up to $1 per share in revenues annually, depending on customer behavior.
Barclays’ Benjamin Budish, who has an equal weight rating on the company, shares a positive earnings outlook but takes a more pessimistic approach. He sees adjusted EBITDA coming in at 6% above consensus, driven by retail trade and stronger-than-expected USDC-related earnings.
He estimates total Q3 transaction revenue at $1.05 billion, topping Street estimates, and models $771 million in subscription and service revenue, above management’s guidance. However, he is reducing his price target to $361 from $365, citing broader market compression.
Compass Point’s Ed Engel is more skeptical. While he acknowledges Q3 results are likely to come in moderately above expectations, he maintains a “sell” rating. His concern centers on Coinbase’s shift toward lower-margin subscription revenues. Engel argued that USDC and staking payouts to users eat into profitability, and investors may be underestimating the impact. He also warned of a slowdown in retail activity in the back half of the quarter and believes that the acquisition of derivatives platform deribit – while strategically interesting – faces increased competition from regulated US venues such as the CBOE.
Notably, Engel was silent on the underlying token potential JP Morgan touts, suggesting less conviction or visibility into the long-term play.
One area of agreement: The USDC is becoming an important revenue center. All three companies highlight how Coinbase benefits from its partnership with Circle (CRCL) and exposure to growing StableCoin balances. But again, analysts differ on how much revenue it can keep as it tweaks reward structures and attempts to funnel users into paid tiers.
As Coinbase further pushes subscription services, on-chain infrastructure and derivatives, Thursday’s earnings report will serve as a test, not only of its recent performance, but where the company’s future vision proves more accurate.
