Coinbase Global Inc (NASDAQ: COIN), on Tuesday, announced its second round of layoffs to cut costs in the midst of the ongoing crypto market downturn. Shares are trading slightly up this morning.
Coinbase to cut 20% of its workforce
The Nasdaq-listed firm had trimmed its workforce by 18% in June of 2022. Now, it plans on cutting it further by 20% – a move that’ll affect as much as 950 of its current employees.
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The layoff, Coinbase confirmed, will result in up to $163 million of additional expense in its first quarter. Together with its other restructuring maneuvers, though, it will help lower operating expenses by 25% in the March quarter.
For the full year, the crypto exchange that announced a $100 million settlement with the NYDFS last week (read more) remains convinced that it’s adjusted EBITDA loss will remain within $500 million. Over the past five months, Coinbase stock has lost roughly 60%.
Should you buy Coinbase stock now?
Also on Tuesday, Oppenheimer analyst Owen Lau recommended buying Coinbase stock and said it had upside to $72 – a massive 80% premium on its current price.
Coinbase can be one of the few long-term survivors in crypto space, which makes it attractive. We view COIN as an enable of crypto innovation, which solves some pain points in the existing financial system.
He’s convinced that strength of its balance sheet and its market share gains are underappreciated. Lau expects Coinbase to eventually bring in about 50% of its total revenue from subscription and services.
The Oppenheimer analyst also sees potential of a short squeeze in Coinbase stock once the macro environment cools off.
Source: https://invezz.com/news/2023/01/10/buy-coinbase-stock-on-second-round-of-layoffs/