Analysts had previously predicted a decline in Coinbase's yearly revenue to around $3.3 billion in 2022.
Brian Armstong, CEO of Coinbase Global Inc. (COIN), predicted that revenue will be half or less of what it was last year as the cryptocurrency exchange struggles in the face of precipitous drops in cryptocurrency prices and the ongoing fallout from numerous bankruptcies this year, including the most recent failure of rival exchange FTX.
Armstrong noted in an interview on Bloomberg’s “David Rubenstein Show: Peer-to-Peer Conversations” that last year, in 2021, “we had approximately $7 billion of sales and about $4 billion of positive EBITDA, and this year with everything falling down it’s looking, you know, probably about half that or less.” According to FactSet, Coinbase will really have made $7.8 billion in sales in 2022.
Participants in the market barely find the predicted reduction newsworthy. Before Coinbase released its third quarter results, FactSet questioned analysts to anticipate its annual revenue for 2022, which was pegged at $3.3 billion. The current estimate is $3.2 billion, which would represent a 59% decrease from 2021.
One of the worst-performing firms on the Nasdaq this year is Coinbase, whose price is down more than 83%. Investors are pulling their money out of firms with a focus on cryptocurrencies, especially in light of the recent collapse of FTX.
Armstrong recently tweeted that he doesn’t trust Sam Bankman-assertion Fried’s that FTX’s problems were just the product of accounting mistakes, despite the recent statements made by numerous prominent investors, like Bill Ackman and Kevin O’Leary. Simply put, Armstrong stated, “It’s stolen client money utilized in his hedge firm.”
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