When Coinbase Global (NASDAQ: COIN) reported its second-quarter earnings on Aug. 9, it announced net revenue for the three-month period of $803 million, which was down 61% from the year-ago period. And the business posted a net loss of $1.1 billion, compared to a profit of $1.6 billion in Q2 2021.
Because most of the company's revenue is tied to trading volume, a poor period for the overall cryptocurrency market in the second quarter deserves a lot of the blame. The Federal Reserve's string of interest rate hikes to curb soaring inflation has resulted in a risk-off approach from investors. But over the past month, this sentiment has seemed to reverse course; Bitcoin and Ethereum are up 16% and 58%, respectively, as of this writing.
Nonetheless, Coinbase is struggling right now, and its shares are down a jaw-dropping 67% in 2022. In the most recent shareholder letter, there was one important data point that really stood out that investors might have missed. And it could forecast more adversity for Coinbase's business.
For further details see:
Here's the Most Alarming Number From Coinbase's Latest Earnings Report