Banking services provider Coastal Financial (NASDAQ: CCB) fell short of the market’s revenue expectations in Q3 2026, but revenue rose 29.6% year on year to $149.3 million. Its GAAP profit of $0.89 per share was 6.3% below analysts’ consensus estimates.

For more on Coastal Financial, read our free full research report.

“The third quarter better reflects the underlying earnings power of Coastal’s business, following a challenging second quarter for our shareholders. During the quarter we updated our assessment of the affected relationship, including loan portfolio performance, expected credit losses and our assessment of the collectability of amounts due under the partner's indemnification arrangement. The results of that review substantially supported the estimates established at June 30, 2026. I am pleased with the momentum we saw across the segments,” said Eric Sprink, Chief Executive Officer of Coastal.

Revenue growth

Two primary revenue streams drive bank earnings. While net interest income, which is earned by charging higher rates on loans than paid on deposits, forms the foundation, fee-based services across banking, credit, wealth management and trading operations provide additional income. Coastal Financial’s 44% annualized revenue growth over the last five years was strong. Its growth beat the average banking company and shows its offerings resonate with customers.

Long-term growth matters most, but within financials, a half-decade historical view may miss recent interest rate changes, market returns and industry trends. Coastal Financial’s annualized revenue growth of 12% over the last two years is below its five-year trend, but the results still suggest healthy demand. Note: Quarters not shown were determined to be outliers because they were impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.

This quarter, Coastal Financial generated strong year-on-year revenue growth of 29.6%, but its $149.3 million of revenue fell short of Wall Street’s high expectations.

Net interest income made up 67.6% of the company’s total revenue during the last five years, meaning lending operations are Coastal Financial’s largest source of revenue.

Net interest income commands greater market attention due to its reliability and consistency, whereas non-interest income is often seen as lower-quality revenue that lacks the same dependable characteristics.

Tangible book value per share (TBVPS)

Banks profit by intermediating between depositors and borrowers, making them fundamentally balance sheet-driven enterprises. Market participants emphasize balance sheet quality and sustained book value growth when evaluating these institutions.

When analyzing banks, tangible book value per share (TBVPS) takes precedence over many other metrics. This measure isolates genuine per-share value by removing intangible assets of debatable liquidation worth. On the other hand, EPS is often distorted by mergers and flexible loan loss accounting. TBVPS provides clearer performance insights.

Coastal Financial’s TBVPS grew at a strong 18.3% annual rate over the last five years. TBVPS growth has recently decelerated to 12.5% annually over the last two years (from $24.51 to $31.02 per share).

Over the next 12 months, consensus estimates call for Coastal Financial’s TBVPS to grow by 13.6% to $35.25, a decent growth rate.

Key takeaways from Coastal Financial’s Q3 results

Coastal Financial’s revenue and net interest income missed Wall Street’s consensus estimates, leaving room for a better quarter despite a narrow beat on tangible book value per share. Shares remained flat at $47.27 immediately after the release.

When deciding whether to invest in Coastal Financial, the latest quarter matters, but not nearly as much as longer-term fundamentals and valuation. Read our full research report here for more on Coastal Financial (it’s free).