Coinbase Stock Climbs 6% on Layoffs Plan

By Sabela Ojea

Shares of Coinbase Global Inc. on Tuesday climbed 6.2% to $40.63 after the cryptocurrency company unveiled a plan to cut about 20% of its workforce.

The effort to reduce costs boosted shares as high as $42.40, a level last seen Dec. 13. The stock is down about 79% since the end of March, when the Securities and Exchange Commission told publicly traded cryptocurrency exchanges like Coinbase to report their customers' digital tokens as liabilities on their balance sheets.

Coinbase said it aims to reduce operating costs by 25% in the first quarter of the year from the prior quarter by cutting about 950 jobs. At the end of September, the company had about 4,700 employees.

Additionally, the company said it expects to incur into total restructuring expenses of between $149 million and $163 million.

Costs linked to contract terminations are set to be in the range of $58 million to $68 million, the company said.

The restructuring plan comes as a response to the "ongoing market conditions impacting the cryptoeconomy, as well as ongoing business prioritization efforts," Coinbase said.

These charges are anticipated to be recognized in the first quarter of 2023, the company said. The restructuring plan, on the other hand, is expected to complete in the second quarter, Coinbase said.

Write to Sabela Ojea at [e-mail]; @sabelaojeaguix

(END) Dow Jones Newswires

January 10, 2023 13:46 ET (18:46 GMT)

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