Coinbase (NASDAQ:COIN) has announced it will slash employee headcount just days in advance of its Q1 2026 earnings report.
According to an email distributed by Coinbase CEO Brian Armstrong, the company will cut its workforce by 14%. At the end of 2025, Coinbase reported 4,951 employees. A 14% reduction means approximately 660 individuals will lose their jobs.
Armstrong explained that “two forces are converging” that have driven his decision to reduce the number of employees.
“First, the market. Coinbase is well-capitalized, has diversified revenue streams, and is well-positioned to weather any storm. Crypto is also on the verge of the next wave of adoption, with stablecoins, prediction markets, tokenization, and more taking off. However, our business is still volatile from quarter to quarter. While we’ve managed through that cyclicality many times before and come out stronger on the other side, we’re currently in a down market and need to adjust our cost structure now so that we emerge from this period leaner, faster, and more efficient for our next phase of growth.
Second, AI is changing how we work. Over the past year, I’ve watched engineers use AI to ship in days what used to take a team weeks. Non-technical teams are now shipping production code, and many of our workflows are being automated. The pace of what’s possible with a small, focused team has changed dramatically, and it’s accelerating every day.”
Armstrong said that Coinbase needs to return to its beginnings, with speed and AI at its core. This means:
- Fewer layers, faster decisions
- No pure managers
- AI-native pods
Impacted employees will receive severance plans, with US employees receiving a minimum of 16 weeks’ base pay (plus 2 weeks per year worked), their next equity vest, and 6 months of COBRA. Employees based outside the US may expect to receive similar support.
Shares of Coinbase moved higher on the news.
Coinbase received a boost this past weekend when it was revealed that the CLARITY Act, crypto market infrastructure legislation, was poised to move forward after a compromise was reached between legacy banking and digital-asset-native firms. While banks feared stablecoin yield would provide a superior method of saving money, crypto firms viewed yield as a benefit to consumers that would fuel digital asset growth and generate more competition. The bill is expected to move to markup in the Senate Banking Committee soon.
Coinbase will announce its Q1 results after the market close on Thursday, May 7. Competitor Robinhood has already posted Q1 results, with investors taking a negative view of the report, driving shares lower.
Consensus analyst expectations for Q1 2026 EPS estimates are around $0.23 to $0.26, a decrease from the $1.94 EPS reported in Q1 2025. Revenue is expected to fall to $1.5-$1.6 billion, from $2.03 billion reported in Q1 2025.