Robinhood Misses Earnings Expectations as Crypto Revenue Slumps and New Products Drive Costs

Robinhood Markets posted a profit that fell short of analysts’ forecasts for the most recent quarter, prompting a 4-5% decline in its share price in after-hours trading. The brokerage reported earnings of 51 cents per share, below the consensus estimate of 56 cents. Revenue rose 12% to roughly $1.4 billion, matching Wall Street expectations, but key profit figures differed between reports. CNBC cited net income of $468 million, while the Wall Street Journal reported profit of $476 million for the same period. Both outlets noted that the shortfall stemmed from higher expenses and a sharp decline in cryptocurrency-related revenue.

Wall Street JournalCNBC

• Transaction revenue: $867 million, up 19% year over year, driven by a more than 500% surge in event-contract revenue and a 31% rise in options revenue to $399 million.

CNBC

• Equities revenue: $121 million, a 41% increase.

CNBC

• Cryptocurrency revenue: $120 million, down 55% as spot-trading volumes fell.

Wall Street Journal

• Expenses: Up 16% to $739 million, reflecting higher marketing spend, the launch of a “Trump Accounts” platform, and provisions for credit-card losses.

Wall Street Journal

• Net deposits: $15.7 billion for the quarter, indicating a 17% annualized growth rate.

CNBC

Chief Financial Officer Shiv Verma told CNBC that event contracts linked to cryptocurrency movements performed well during the quarter, offering investors a way to express views on crypto despite the broader market slump. He emphasized the company’s strategy of diversifying beyond volatile crypto trading toward options, event contracts, and wealth-management services.

CNBC

The two sources differ on the quarter’s designation and profit amount. CNBC frames the results as the third quarter ending in September, reporting net income of $468 million; the Wall Street Journal labels the same period as the fourth quarter and cites profit of $476 million. Both agree on earnings per share (51 cents) and the 12% revenue growth, but the inconsistency in quarter labeling and profit totals remains unresolved.

CNBC

Robinhood’s earnings miss highlights the challenge of sustaining growth while reducing reliance on volatile crypto trading. The pronounced gains in options and event contracts suggest the firm’s diversification is gaining traction, yet rising operating costs and a lingering crypto slump keep profitability under pressure. Investors will be watching whether the new “Trump Accounts” platform and other subscription services can offset these headwinds in upcoming quarters.

CNBC