The first quarter revenue reports of the popular cryptocurrency exchange firm Coinbase Global Inc showed the company did not suffer a loss to the extent that was predicted by analysts and different sources.
The company was able to achieve this through different cost-cutting methods and also with the diversification of its different revenue sources. These effective measures followed by the company assisted in the 7 percent increase in its shares in extended trading on Thursday.
One major event that helped the company achieve this feat was its deal with One River Digital Asset Management. The deal helped the company to elevate and enhance the different services offered by the company to its customers in subscription and service revenue.
Along with making an effective deal that could enhance their different services, the company was also able to launch wallet-as-a-service and some similar other services and products to scaler blockchain.
According to the reports published by Coinbase Global Inc, the company reported a loss of 34 cents a share. What is more surprising is the fact that analysts predicted a loss of $1.35 per share.
This huge margin in the predicted and actual value of the shares is due to the fact that the investors moved back to the speculative asset class in order to protect themselves from the elevated market risk, following the brutal sell-off that took place last year.
But his trend is yet to help the company to make gains and the trading volumes of the company have reduced to around half at $145 million.
The retail trading volumes of the company played a significant role in making the name of the company a household one in 2021 also marked a decrease of 72%. During the setting of the year, the company also made it clear that they will be cutting down around 950 more jobs in their third round of layoffs.
According to the Chief Financial Officer of Coinbase Global Inc Alesi Haas, the company has deeply benefitted from the different cost-effective methods that they have introduced over time.
She said that the company had learned deep lessons from trying to grow too fast and that they will be making the next step with great consideration and caution.
Haas also shared the possibility that the new and improved cost structure adopted by the company will help them in achieving the 2023 goal of the company increasing and improving their core profit.
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While comparing the operating expenses of the company with the numbers from last year, there had been a decrease of sound 24% from the last quarter.
The company reported around $607 million in expenses in this quarter, which is very much lower than the previous number which ranged between $625 million and $675 million. The shares of the company faced a massive decline in 2022.
The shares of the company fell by around 85% in its values. But the company also recorded a further increase of about 40% this year as of Thursday’s close.
Coinbase Global Inc has been facing a few backlashes in its business due to the sudden changes that are being introduced to the crypto market by the United States government and other concerned agencies. The regulatory changes in the crypto market have seriously affected the company.
Coinbase Global Inc received a notice from the Securities and Exchange Commission recently where the letter threatened the company to sue its different business lines.
According to Owen Lau who is an analyst of Oppenheimer & Co, despite the different difficulties that were aimed at the company, Coinbase Global Inc was able to make a positive turn of events.
The CEO of Coinbase Global Inc, Brian Amstrong stated that the company still remains 100% committed to the country and the customers that the company has.
Along with the statement from the CEO, the Chief Legal Officer of Coinbase Global Inc, Paul Grewal said that the company expects to be fully optional during the time period that is required to resolve the litigations that the company has with the Securities and Exchange Commission, even though the time period required to do so is not clear as of now.
The CEO of Coinbase Global Inc, Brian Armstrong is a strong advocate for freedom and relaxation in the field of crypto marketing. He has openly talked against the new regulations that the government and different agencies introduce in the field.
According to Armstrong, these regulations can seriously affect the growth of the sector and also the financial sector of the company as a whole.
The unexpected collapse of the cryptocurrency exchange platform FTX has triggered the government and other concerned bodies to make necessary regulations in the field in order to avoid any potential loss to customers.
While most of the companies that operate in the field are against the introduction of new regulations, the government is also very strong in its stand of increasing security and supervision in the sector.
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