Swissquote Lowers Annual Forecasts as Crypto Revenue Drops, Shares Fall

Swissquote Group has lowered its revenue and profit expectations for the year due to a sharp decline in its cryptocurrency income for the first half of 2023.

Crypto trading volumes plummet, leading to revised financial projections.

Swissquote Group (SQN), a leading financial services provider based in Switzerland, reported a staggering 66.2% drop in net crypto revenue, which fell to 14.6 million Swiss francs (around $18 million) for the first half of the year. This decline prompted the company to revise its full-year revenue forecast downward by approximately 30 million francs, adjusting the new target to 730 million francs.

The bank's report indicated a 63.5% reduction in total cryptocurrency trading volume, which amounted to 2.58 billion Swiss francs ($3.2 billion). Swissquote attributed this downturn to significant price declines in the crypto market, with Bitcoin (BTC) and Ethereum (ETH) dropping by 33% and 47%, respectively, over the six-month period ending June 30. The CoinDesk 20 Index (CD20) also reflected a 40% decrease.

In their commentary, Swissquote acknowledged, “The revised guidance now reflects a weaker-than-expected crypto environment.” Furthermore, the bank reported a loss of 5.3 million francs tied to its crypto inventory for trading purposes at its SQX exchange.

Despite the downturn in the crypto segment, Swissquote managed to achieve some stability in overall revenue, driven by growth in other business areas, including a nearly 20% increase in client assets, which reached 96.3 billion francs. Following the announcement, Swissquote's shares fell by 14%.