November 01, 2026 – The exchange returned to profit after three losing quarters. Yet its own Bitcoin and Ethereum did most of the work, while customer trading kept fading.
In Summary
Coinbase earned $718.7 million in the third quarter, ending three straight quarterly losses.
Gains on its own crypto holdings supplied $715 million, so adjusted net income was just $78 million.
Spot trading volume fell to $134.5 billion, less than half the level of a year earlier.
Prediction markets passed $200 million in annualized revenue, while USDC economics weakened after rewards.
Coinbase Q3 results showed a net profit of $718.7 million, ending three straight quarterly losses. However, rising prices on the firm’s own crypto did most of the lifting. The exchange booked $715 million in gains on crypto held for investment, its quarterly report shows.
Meanwhile, the core business kept shrinking. Total revenue was $1.216 billion, flat from the prior quarter but down 35% from a year earlier. Transaction revenue fell 44% to $590 million.
Coinbase Q3 profit leaned on investment gains
Strip out those gains and the picture changes. Adjusted net income came to just $78 million. By contrast, adjusted EBITDA rose 60% from the second quarter to $333 million, the earnings deck shows. That marked a 15th straight quarter of positive adjusted EBITDA. The Coinbase Q3 report also showed tighter costs, with operating expenses down 17% from a year earlier to $1.15 billion.
That turnaround was sharp. Coinbase lost $359 million in the second quarter, according to its earlier filing. In that period, crypto prices fell and the same holdings produced losses.
Trading volume keeps sliding
Customer trading cooled again. Spot volume fell 8% from the second quarter to $134.5 billion. That is less than half the $294.3 billion Coinbase handled a year earlier. Consumer volume dropped to $23.4 billion from $57.4 billion over the same span.
Still, Coinbase gained ground on rivals. Its share of global crypto trading volume rose to 10.7% from 5.6% a year earlier. In other words, the whole market shrank faster than Coinbase did. Derivatives volume rose 14% from a year earlier to $963 billion. Moreover, Coinbase has now gained derivatives share for four straight quarters.
Prediction markets and USDC carry the story
Newer products are filling part of the gap. Prediction markets passed $200 million in annualized revenue, Coinbase said in its results release. The product grew at an 82% compound quarterly rate since launch. Daily prediction traders also rose more than 60% from the second quarter.
Subscription and services revenue rose 3% to $570 million, or 49% of net revenue. Average USDC held in Coinbase products hit a record $22 billion. Even so, stablecoin revenue slipped 5% to $306.9 million as lower interest rates cut yields.
Payouts to users grew at the same time. USDC rewards expense rose 16% to $129.2 million. As a result, stablecoin revenue after rewards fell to about $178 million from $213 million.
What investors are watching next
Investors did not cheer the report. Coinbase shares fell 10.6% to $143.54 on October 30, Nasdaq data show. That left the stock just above its 52-week low of $139.11.
The balance sheet adds another layer of risk. Coinbase held 17,954 bitcoin and 152,649 ether for investment at September 30. Together, they carried a fair value of $2.22 billion. Price swings on that pile now flow straight into earnings.
That cuts both ways. Bitcoin has fallen about 8% since September 30 on Kraken prices, and ether about 16%. Therefore, the fourth quarter may hinge on crypto prices as much as on customer activity.
