Coinbase to Buy Back up to $150M in Own Corporate Bonds

Coinbase has unveiled plans to initiate a buyback of a portion of its $1 billion bonds.

The buyback initiative will see the San Francisco-based company repurchase up to $150 million of its $1 billion bonds set to mature in 2031, with Citigroup Global Markets managing the offer.

Coinbase's tender offer is structured in a tiered manner, designed to incentivize early participation. Investors who choose to take part in the buyback and sell their bonds before August 18 will be rewarded with a premium of $645 for every $1,000 of the bond's face value, translating to 64.5 cents on the dollar.

This offer includes a special early-tender premium of $30, the company said.

For investors who opt to sell their bonds after August 18 but before the offer expiration date of September 1, Coinbase will extend an offer of $615 for every $1,000 of the bond's face value, equating to 61.5 cents on the dollar.

It's noteworthy that both offer prices exceed the unaffected price of the bond as of August 4, which stood at approximately 60 cents on the dollar, according to data from Business Insider.

Coinbase didn't immediately respond to Decrypt's request for comment.

Coinbase rallies on strong quarterly performance

The strategic maneuver comes on the heels of Coinbase’s second-quarter earnings report, which saw the company report revenues of $708 million and an adjusted earnings-per-share loss of $0.42, beating analyst expectations of revenues of $628 million and earnings-per-share loss of $0.76.

In contrast to the corresponding period last year, Coinbase’s revenue experienced a notable decline from $808 million. However, the company managed to curtail its losses, presenting a marked improvement compared to the staggering loss of $4.98 per share recorded during the same period in 2022.

In a letter to shareholders, Coinbase said that the company's robust quarter was propelled, in part, by an ongoing commitment to enhancing efficiency and “being more financially disciplined.”

Notably, the company emphasized a remarkable 50% reduction in its recurring operational costs year-over-year, which included a significant streamlining of the workforce, with a reduction of 30% in its headcount during this period.