Coinbase Trims 2026 Cost Guidance as Wall Street Stays on the Fence

Coinbase has given investors something to cheer about on the cost side, but two of Wall Street's most closely watched research houses aren't ready to change their tune. Mizuho and Jefferies both trimmed their price targets on the crypto exchange on the same day, each keeping a neutral stance — and each for a different reason.

The company now expects adjusted full-year 2026 expenses of $4.15 billion to $4.30 billion, roughly $100 million below its prior plan at the midpoint. That guidance cut is a deliberate counterweight to a trading business that continues to lose momentum, and it arrived a day after Coinbase published its quarterly results.

Two Houses, Two Stumbling Blocks

Mizuho lowered its target to $145 from $155, pointing to softness in the core business and flagging the risk that Coinbase cedes retail market share to Robinhood. That concern is a worry rather than a confirmed finding, but it shifts the debate: it isn't enough for crypto trading to perk up — Coinbase also has to defend its slice of the private-client pie. Trading trends Mizuho tracks are running slightly ahead of the prior quarter, though the firm doesn't regard that as sufficient grounds for the all-clear. A modest pickup and disappointed market expectations can, after all, coexist.

Jefferies, meanwhile, cut its target to $174 from $183 and kept its hold rating, citing the spending outlook. Its emphasis differs from Mizuho's: revenue alone won't settle the question — the cost of running a broader product suite matters just as much.

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The Profit Headline Masks the Underlying Picture

The quarter itself offers conflicting signals. Coinbase posted a net profit of $719 million, but that figure included $715 million in gains on crypto investments; adjusted net income came in at just $78 million. The chasm between the two numbers limits what the swing back into the black actually tells you — the return to profitability ended a run of three consecutive loss-making quarters, yet it is no proof of a broad operational recovery.

Operating costs fell 17% year on year to $1.15 billion in the third quarter of 2026, according to Reuters. Transaction revenue reached $590.2 million over the same period, while spot crypto trading volume slid 10% from the previous quarter. Cost cuts can ease the pressure on earnings, but they cannot substitute for a revival in customer activity.

Subscriptions and Services Pick Up the Slack

That is where the widening revenue base comes in. Subscriptions and services accounted for 49% of net revenue in the third quarter of 2026, and Coinbase One subscribers climbed 24% year on year to a record. Management expects $550 million to $630 million in revenue from subscriptions and services in the fourth quarter of 2026.

Derivatives and prediction markets are gaining ground within the transaction business as well, together contributing roughly 25% of transaction revenue. Prediction markets alone have pushed their annualized revenue rate past $200 million — a run-rate figure, not a quarterly tally.

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For investors, the distinction between reported earnings and underlying earning power is the one that counts. Lower costs provide immediate relief; gains on held crypto say little about how revenue from customer activity is developing. New products must do more than offset weaker trading — they have to contribute meaningfully to the bottom line.

Neither target cut amounts to a blanket rejection of Coinbase's strategy. They simply mark out different hurdles for a higher valuation: Mizuho wants more convincing trading trends, Jefferies a better balance between growth and spending. That is the yardstick by which the next few quarters will be measured.

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