Coinbase Reports First-Quarter Loss After Crypto Prices Fall and AWS Outage Halts Trading

Coinbase posted a surprise first-quarter loss of $1.49 per share on revenue of $1.41 billion, missing Wall Street estimates for a 27-cent profit and $1.52 billion in revenue. The results reflected a 22 percent decline in bitcoin during the quarter and lower trading volumes that weighed on the company's largest revenue source.

Transaction revenue came in at $755.8 million against $805.2 million expected while subscription and services revenue totaled $583.5 million versus $619.3 million projected. Shares fell about 4 percent in extended trading after the report. The company said stablecoin revenue rose to $305 million from $274 million a year earlier, helped by growth in the market capitalization of its USDC stablecoin.

Derivatives trading volume reached roughly $4.2 billion, a 169 percent increase from the same period last year.

Coinbase trading remained unavailable for more than five hours on May 7 after an Amazon Web Services outage struck multiple availability zones in the U.S. East region in northern Virginia. The exchange shifted briefly to cancel-only mode before restoring full service the following day.

The company blamed increased temperatures inside an AWS data center. It said its systems are designed to survive a single-zone failure but were overwhelmed when several zones were affected simultaneously. "This primary issue is now fully resolved," the company stated on X.

“Coinbase experienced service disruptions due to increased temperatures in the affected AWS service.”

CME Group also reported technical and latency issues with its trading platform on the same day though it was not immediately clear if the problems were linked to the AWS outage. Both CME and AWS declined to comment outside regular business hours.

Coinbase announced on May 5 that it would cut roughly 14 percent of its workforce, or about 700 jobs, as part of an AI-driven restructuring prompted in part by the crypto downturn. The company had forecast that its prediction market business, launched in late January in partnership with Kalshi, would generate $100 million in annualized revenue by year-end.

It gained market share in both spot and derivatives trading worldwide, reaching an all-time high of 8.6 percent of global crypto trading volume despite the price slump. Executives said the company continues to build an "everything exchange" less dependent on token trading alone.

"We're trying to diversify the things that people can trade so that as markets shift, as different behaviors shift, we'll always have something that people want to trade," Coinbase Chief Financial Officer Alesia Haas told CNBC. The first-quarter results and outage come as the platform faces ongoing questions about technical resilience after similar disruptions in past years of high market volatility.

Coinbase net income has often swung sharply because of accounting rules that require marking its crypto holdings to market prices at quarter-end even when no assets are sold.