Coinbase shares dive 23% after revenue miss

Shares of Coinbase plunged about 23% on Wednesday morning after the company reported shrinking revenue and declining users.

Coinbase said Tuesday that revenue fell 27% year-over-year to $1.17 billion, which was below Wall Street's projected $1.48 billion. It also said it lost $430 million in the first quarter.

Usage on Coinbase declined from the fourth quarter. Retail monthly transaction users slid to 9.2 million, down from 11.4 million in the fourth quarter. Total trading volume declined from $547 billion in the fourth quarter to $309 billion.

The earnings report comes amid a broader sell-off in the technology sector, and the crypto market is experiencing a major downturn. Bitcoin, the world's largest digital currency by market value, has fallen more than 50% from its peak price of $68,990.90 in November 2021. It was down 6% as of Wednesday morning, trading below $30,000.

Several firms cut their price target on Coinbase stock following the report.

"Revenue was below expectations across the board, while expenses ramped more quickly than anticipated to drive earnings meaningfully lower," JPMorgan analysts said in a note. The firm slashed its price target to $171 from $258.

Goldman analysts downgraded the stock to neutral, saying in a note to clients on Wednesday that they believe the Coinbase is unlikely to return to profitability in the near term.

"In an environment where the market is focused on profitability, recession risk, and the fading
of pandemic-driven exuberance in retail trading, we believe COIN's stock will struggle to outperform in the near term," the analysts wrote.

-- CNBC's MacKenzie Sigalos and Michael Bloom contributed to this report.

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