Coinbase Q3 2026: $719M net income, prediction markets at $200M+ annualized

Coinbase filed its Q3 2026 10-Q on Oct 29, booking $718.7M in net income on $1,215.6M total revenue — net income up 66% year-over-year from $432.6M, revenue down 35% from $1,869M. The pattern is the same one Coinbase has pointed to for three quarters: softer spot trading, a jump in prediction markets (annualized run rate now >$200M), a mark on crypto-asset holdings that lands on the income line.

What happened — the numbers

Per the Q3 2026 earnings deck filed as Form 8-K Exhibit 99.1:

• Total revenue: $1,215.6M (Q3'25: $1,868.7M; -35% YoY).
• Net revenue: $1,160.5M (Q3'25: $1,762.9M; -34%).
• Net income: $718.7M (Q3'25: $432.6M; +66%).
• Transaction revenue, net: $590.2M (Q3'25: $1,046.3M; -44%).
• Consumer transaction revenue: ~$450M (vs ~$844M).
• Institutional transaction revenue: ~$92M (vs ~$135M).
• Subscription & services: $570.2M (-20%).
• Transaction expense: $194.5M (-23%).
• Gain on crypto assets held for investment: $715M booked to net income (vs $424M a year earlier).

Volumes:

• Spot trading volume: ~$135B, down 8% QoQ.
• Derivatives volume: ~$986B, down 7% QoQ, against an industry drop of 11% QoQ.

Mechanism — where the mix shifted

Three callouts from the deck and the 10-Q:

1. Prediction markets crossed $200M annualized — roughly double the prior quarter's ~$100M — with Coinbase citing an 82% quarterly compound growth rate since launch. The segment is folded into transaction revenue and is not broken out as its own line. CEO Brian Armstrong called it "one of the fastest-growing products in Coinbase history" on the call.
2. Subscription & services at $570.2M "now represents nearly half of net revenue" per CFO Alesia Haas — a shift from a quarter when spot was the dominant engine.
3. Stablecoin revenue (per the deck's Q3 2026 reconciliation) totaled $328M, including $21M from USDC held on Coinbase's own corporate balance sheet; this uses a slightly different definition than the $307M in "stablecoin revenue" on the P&L. Both are down modestly versus Q3'25.

The $715M gain on investment-held crypto is a mark-to-market effect from the quarter's price action; it is not a cash-trading number. Without that line, pre-tax profit from operations would be materially lower — a point the P&L separates but headlines usually don't.

Numbers block

• Net income Q3'26: $718.7M (+66% YoY).
• Of which, crypto-asset mark: $715M.
• Net revenue Q3'26: $1,160.5M (-34% YoY).
• Transaction revenue, net: $590.2M (-44% YoY).
• Prediction markets, annualized: >$200M (up ~2x QoQ).
• Spot volume Q3'26: ~$135B (-8% QoQ).
• Derivatives volume Q3'26: ~$986B (-7% QoQ).
• Stablecoin revenue (deck definition): $328M, incl. $21M USDC on corporate balances.
• Filing: 10-Q filed Oct 29, 2026.

What to watch

1. The 10-Q itself — whether prediction-markets accounting breaks out separately in 2026 10-K.
2. Volume stabilization — Q3 was the second straight quarter with spot volume below the 2025 peak. Q4 opens into the Binance aftermath (see our writeup); some flows migrated to Coinbase during the Thursday outage.
3. Transaction-expense ratio — $194.5M on $590.2M of transaction revenue is a 33% ratio, the lowest in six quarters, worth a look in the next guidance.
4. Prediction-markets regulatory posture — the segment's growth is CFTC-adjacent; the derivatives-exchange filings and CFTC letters covered on this site this month (see the Kalshi and Polymarket posts) are the compliance backdrop.

Context — the "crypto exchange that is not just an exchange" pivot

Coinbase's spot volume keeps slipping, and the net-revenue line keeps compounding — a divergence that was theory a year ago and is now four quarters of filed data. The composition change this quarter — subscription & services at ~49% of net revenue, prediction markets doubling off a small base — is the clearest expression yet of the pivot. Analyst notes we read today (Bernstein, William Blair) flag the same shift.

Sources

• SEC Form 8-K Exhibit 99.1, Coinbase Q3 2026 earnings deck.
• The Block, Coinbase Q3 net income jumps 66% as prediction markets gain traction.