Robinhood (Nasdaq: HOOD) said its cryptocurrency revenue dropped 55% from a year earlier to $120 million in the July-September quarter, its results showed on Tuesday. Total revenue rose 12% to a record $1.42 billion, but net income fell 14% to $476 million, or $0.51 a diluted share. CryptoWatchDesk last covered Robinhood on 22 Oct, when it won a Dubai licence for stocks and crypto.
The mix has flipped: event contracts, Robinhood’s prediction markets, earned $173 million, more than six times a year earlier and now ahead of crypto. Crypto made up about 8.4% of revenue against 21% a year ago, CoinDesk calculated. Options brought in $399 million and equities $121 million.
Activity explains the drop. Crypto notional volume fell 38% to $50 billion, with the app’s share down 48% to $21 billion and Bitstamp’s down 28% to $29 billion. Customers traded a record 16.4 billion event contracts, while total platform assets rose 19% to $396 billion, which the company said was partly offset by lower crypto valuations.
Transaction-based revenue of $867 million missed the $879 million StreetAccount estimate, CNBC reported, and the shares fell about 5% after hours. “Customers are trusting us with more of their assets as we deliver on our product roadmap, leading to our highest quarter ever for revenues,” said Shiv Verma, the chief financial officer.
Robinhood said its own blockchain, Robinhood Chain, ranked among the top five chains by revenue and volume in its first quarter on mainnet, with more than $80 billion of decentralised exchange volume. The company also pointed to its UK crypto launch. Its event-contract growth comes as regulators fight states over the product, most recently in the CFTC’s suit against Utah.
Peers report soon. Galaxy Digital’s third-quarter profit came mostly from its own investment book, and Coinbase and Strategy follow on Thursday, according to the week’s earnings calendar.
Net deposits were $15.7 billion in the quarter, and Verma said October deposits had already passed $13 billion month to date.
This article is for information only and is not investment advice.