May 4 (Reuters) - Cryptocurrency exchange Coinbase Global Inc (COIN.O) It posted a smaller-than-feared loss in the first quarter, benefiting from cost cuts and diversifying revenue sources, sending its shares up 7% in extended trading on Thursday.
The company has benefited from its deal for One River Digital Asset Management to increase product offerings in subscription revenue and services, while also launching wallet-as-a-service and other products to scale blockchain.
"We're also seeing the benefits of greater cost efficiencies, and we've learned deep lessons from growing too fast and believe we're going to be prudent in our spending going forward," said chief financial officer Alesia Haas.
Coinbase posted a loss of 34 cents per share, while analysts estimated a loss of $1.35, as investors tiptoed back into the speculative asset class to hedge against elevated market risks after a sell-off on last year.
But the trend is still to drive profits for the cryptocurrency exchange, as trading volumes more than halved to $145 million, while retail trading volumes, which had been instrumental in making Coinbase a name family in 2021, they sank 72%.
Earlier this year, the company said it will cut 950 more jobs at its third round layoffs since last year.
Haas said the improved cost structure will help the company meet its 2023 goal of improving core earnings year-over-year.
The company reduced operating expenses by 24% from last quarter and reported $607 million in expenses, well below its previous range of $625 million to $675 million.
โEveryone was expecting disastrous results, and it doesn't seem to be a disaster for Coinbase at all,โ said Dave Weisberger, chief executive of CoinRoutes, an algorithmic trading platform for the digital asset industry.
Coinbase shares, which lost 85% of their value in 2022, are up nearly 40% this year as of Thursday's close as cryptocurrencies gain some ground.
Reporting by Mehnaz Yasmin in Bangalore; Edited by Maju Samuel
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