On Friday, Coinbase stock surged 16% after posting its first profit in two years. The largest US cryptocurrency exchange has reported significantly better than expected earnings thanks to growth in transaction volumes. The company posted for its first quarter an adjusted EPS of $1.04, better than the $0.02 EPS forecasted by Wall Street analysts. Quarterly results surged with transaction revenue up 64% due to Bitcoin spot ETF approvals and anticipated macroeconomic improvements in 2024. The Vice President of Investor Relations, Anil Gupta, dismissed concerns about fee compression, noting a surge in trading volumes to $154 billion in Q4, surpassing analysts’ projections by far. Coinbase shares have shown bullish momentum, bouncing off the 50-day moving average, with attention on the $210 upper trendline.
The streaming service provider Roku lost 22.3% of their value in the morning session after the company posted larger than expected loss for the fourth quarter. Management cited challenging macroeconomic conditions and an uneven ad market recovery, forecasting seasonal revenue declines in line with Q1 2023. Roku surpassed revenue estimates, driven by user base growth and strong performance in Platform and Devices segments. Its revenue guidance for next quarter also topped analysts’ expectations, and overall, this quarter’s results seemed mixed, but the market was likely expecting more from this report.
Nike’s stock tumbled a further 3% on Friday, following a tumultuous 2023 where we witnessed a 20% decline. The main reason for this was the news that Nike is laying off 1600 employees, (about 2% of its workforce) potentially reflecting further demand weakness ahead. News of layoffs often boosts stocks due to potential profitability gains. However, in this instance, investors fear declining demand and pricing pressures. Nike’s retail partners are reducing orders and inventory, signaling ongoing challenges.
Author: Filippo Ferrero