Coinbase (NASDAQ:COIN) CEO Brian Armstrong said Tuesday that the company will cut roughly 14% of its workforce, citing a combination of market volatility and the how AI is quickly changing how the company operates.
The move comes ahead of Coinbase’s first-quarter earnings, which the company is scheduled to report Thursday. Shares stumbled $4.61, or 2.3%, in Tuesday trading to $198.38.
In a memo to employees, which he shared on X early Tuesday, Armstrong described the decision as necessary to position the firm for its “next phase of growth” while navigating the current downturn in the crypto market. He cited two “forces converging at the same time”: the current pullback in the crypto market and “AI changing how we work.”
Although crypto is “on the verge of the next wave of adoption,” he said, “our business is still volatile from quarter to quarter … 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.”
Furthermore, “the pace of what’s possible with a small, focused team has changed dramatically, and it’s accelerating every day,” he said about AI. “We are adjusting early and deliberately to rebuild Coinbase to be lean, fast, and AI-native. We need to return to the speed and focus of our startup founding, with AI at our core.”
