Coinbase to Cut 18% of Jobs as Crypto Winter Arrives; Shares Down 6%
2022.06.14 16:10
Coinbase (COIN) to Cut 18% of Jobs as Crypto Winter Arrives; Shares Down 6%
By Senad Karaahmetovic
Coinbase (NASDAQ:COIN) announced today that it plans to reduce its workforce by around 18% with roughly 1,100 employees set to lose their jobs.
The crypto exchange plans have approximately 5,000 total employees as of the end of its current fiscal quarter on June 30, 2022, it said in a filing. Coinbase will incur between $40 million to $45 million in restructuring costs.
“The Company is not updating the outlook that it provided on May 10, 2022 in a letter to its shareholders announcing its financial results for the quarter ended March 31, 2022. However, as a result of the Plan, the Company expects that the previously provided outlook for the Company’s technology and development and general and administrative expenses for full year 2022 to be closer to the lower end of the range included in the Shareholder Letter,” the company said in a filing.
Earlier today, COIN stock was cut to Neutral at J.P. Morgan on lower crypto trading volumes and a strong investment cycle. Analyst Kenneth B. Worthington noted that Coinbase hired over 3,200 staff over the last year.
“With cryptocurrency prices falling meaningfully, Coinbase may need to go beyond just a hiring freeze and reduce expense levels to keep EBITDA losses to its $500mn guidance cap for 2022,” the analyst wrote earlier today.
Read More: Coinbase (COIN) Stock Extends Decline After JPMorgan (NYSE:JPM) Downgrade, PT Cut by 60%
Shares of the company have now extended the decline to trade 6% lower in pre-market Tuesday.
