Robinhood delivered another strong quarter, posting net gains in revenue and profit as crypto activity exploded. Markets fell slightly after hours, but the year-to-date rally remains among the strongest among publicly traded fintech and crypto-adjacent companies.
In brief
- Robinhood nearly doubled its revenue to $1.2 billion, driven by strong growth in crypto trading and the rise of prediction markets.
- Profits increase 217% year-over-year to $556 million, driven by strong user engagement around new product offerings.
- Prediction markets generate over $100 million, with sports event contracts driving increased participation on the platform.
- The stock is up 260% year-to-date despite a post-close decline, outpacing its main fintech and crypto rivals while analysts remain optimistic.
Robinhood Profits Rise 217% in Exceptional Quarter
Robinhood Markets reported $1.2 billion in revenue in the third quarter, nearly double its revenue a year earlier and above Wall Street forecasts. Earnings rose to $0.61 per share, up about 217% year-over-year, while profits reached $556 million.
CEO Vlad Tenev attributes these results to rapid product expansion, citing the growth of prediction markets, the rollout of Robinhood Banking, and the company's early-stage investment arm, Robinhood Ventures.
Our team's relentless velocity in product development led to record business results in the third quarter and we're not slowing down, Prediction Markets are growing rapidly, Robinhood Banking is starting to roll out, and Robinhood Ventures is coming.
Vlad Tenev
Shares fell in after-hours trading Wednesday to $143.40. Still, the stock has soared about 260% since January, outpacing rivals like Coinbase, which is up about 25% over the same period.
Robinhood benefits from crypto market recovery while event trading gains ground
Crypto trading has once again been a major driver of this impressive market growth. Crypto trading revenue reached $268 million, more than triple last year's figure for the same quarter. This performance follows $160 million in Q2 and $252 million in Q1, signaling sustained user demand despite broader volatility in digital assets.
Transaction-based revenue totaled $730 million, slightly below analysts' expectations. The prediction markets stood out by generating more than $100 million. Robinhood's entry into event-driven contracts has proven timely, with sports betting and economic forecasting generating continued interest.
In the middle of the press release, Robinhood detailed several operational changes and performance factors:
- Strong crypto turnover despite uneven market sentiment.
- An increase in revenue from prediction markets.
- Higher user engagement through sports-related event contracts.
- Expanded services through Robinhood Banking.
- An increase since the start of the year in shares outperforming sector peers.
Menlo Park-based Robinhood also announced an upcoming leadership change. CFO Jason Warnick plans to retire next year, with company veteran Shiv Verma set to take over.
Market decline deemed temporary, analysts anticipate an institutional rebound in Bitcoin
Second-quarter results had already shown strong momentum, with $989 million in revenue and $0.42 in earnings per share, both above projections. Analysts at Compass Point recently affirmed a “buy” recommendation, increasing their price target to $161, above Robinhood's previous high of $153 in October.
Compass Point projects approximately $50 million in fourth-quarter revenue from prediction markets during a full NFL season. Robinhood entered sports betting in August through a partnership with prediction markets operator Kalshi, which allows customers to place event bets on NFL and college football games.
The platform also offers markets related to economics, culture and technology. Trading these contracts is commission-free, although there is a one-cent fee per trade.
Crypto-focused businesses continue to face an uncertain macroeconomic backdrop. Bitcoin gained just over 6% in the third quarter, a modest rise after a sharp 30% jump in the previous quarter. According to market data, the OG crypto sits at $102,957, up 1.1% in the last 24 hours but still down about 18% from its all-time high set a month ago.
Despite the market decline, crypto commentators view the decline as temporary. Matt Hougan, CIO of Bitwise, says the recent sell-off reflects fading retail demand rather than a structural downturn, arguing that waning retail interest could create space for institutional investors to return.
Former BitMEX CEO Arthur Hayes added that US monetary conditions could set the stage for the next bull cycle, pointing to what he described as subtle liquidity support from the Federal Reserve.
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